Trustees receive quarterly investment report; approve new investment‑policy definitions and higher non‑U.S. target

Oklahoma City — The Oklahoma City Post Employment Benefits Trust on Feb. 12 received a quarterly investment report covering the year ended Dec. 31, 2024, and approved amendments to the trust’s Statement of Investment Policies, Guidelines and Objectives to clarify targets and implementation rules.

Jason Pujols, the trust’s investment consultant, said the portfolio’s strong recent performance largely reflected a heavy allocation to U.S. large‑cap stocks. “This portfolio has a very large allocation to US large cap stocks,” he said, noting that U.S. large cap has been the best performing asset class over the last decade and represents roughly 60% of the trust’s current allocation.

Pujols reviewed performance and forward‑looking assumptions: the trust’s market value grew from about $29.2 million to roughly $112.8 million over the last decade, and the trailing 10‑year return stood above the actuarial hurdle in recent history. But he cautioned that forward‑looking, geometric 10‑year return expectations are lower than the 7.5% actuarial discount rate. Based on capital‑market modeling, he said “the probability of 7 and a half is a little under 50%” over the next decade, and recommended trustees consider modest policy changes and clear definitions in the investment policy to align targets with the global opportunity set.

Trustees unanimously received the quarterly and monthly investment reports (items 3b and 3c). The board then discussed asset allocation and accepted staff recommendations to revise the Statement of Investment Policies, Guidelines and Objectives. Key changes approved in the amendment included: consolidating fixed‑income categories into core/core‑plus, defining large cap at 35% and small/non‑large cap at 15% within U.S. equity, and increasing the non‑U.S. equity target from 10% to 20%. The amended policy also clarifies that trustees retain fiduciary decision authority, may appoint an investment committee, and may delegate certain administrative functions to the City Treasurer’s Office. The amended policy removes detailed separate‑account language and prefers commingled funds or registered investment companies where appropriate.

Pujols and trustees said the policy edits are intended to better reflect current practice and make targets closer to the MSCI ACWI opportunity set (roughly two‑thirds U.S., one‑third non‑U.S.). Trustees approved the policy amendments by unanimous recorded vote.

Staff said the changes will be implemented operationally by rebalancing over time and that they do not change benefit or contribution policy. Trustees discussed staging any moves into non‑U.S. assets rather than shifting the full target in a single transaction.

The amendments passed unanimously; staff said they may call a special meeting between Feb. and the regular May meeting if additional implementation or allocation decisions are required.