Finance Director Stephanie presented a CalPERS actuarial valuation to the Redondo Beach Budget and Finance Commission and the commission voted to accept the valuation “on file.”

Why it matters: The valuation informs the city’s required pension payments and long-term liabilities. The finance director said the valuation showed improvement in the city’s funded levels and a continued decrease in employer normal cost, but she cautioned that the city’s annual unfunded liability payment will likely remain near current levels for the next few years.

Key takeaways from the presentation:
- The commission was told the city’s combined unfunded accrued liability (UAL) decreased by about 12%, roughly $7.1 million, driven in part by recent positive investment returns.
- The finance director said the city’s employer normal cost decreased for a third consecutive year and that the 2026–27 unfunded liability payment is expected to remain approximately $4.3 million, similar to the current year’s payment.
- The miscellaneous plan was reported at about a 96.3% funded level. The finance director also noted the effect of prior large negative investment returns that remain amortized into current payments and the ramping mechanism CalPERS uses to phase gains and losses into payments.
- The presentation included the most recent investment return for fiscal 2024–25 of 11.6%, above CalPERS’ 6.8% target; the finance director said that positive return will show up in future valuations and could moderate long-term liability trends.

Quote: Finance Director Stephanie said, “I wanted to provide the commission with a little mini update on our CalPERS valuation.”

Action: A motion to receive the CalPERS valuation report on file was moved, seconded and carried by the commission.

Context and next steps: The finance director said she will continue working with the city’s actuary to prepare scenario projections and recommended the commission identify specific questions or charts it wants discussed at the regularly scheduled pension-focused meeting that typically occurs in December.