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Retirement investment commission asks legislature to keep $16.5M authorization, cites $4 billion in excess value since 2020
Summary
Mike Hitchcock told the Constitutional Subcommittee the Retirement System Investment Commission seeks to maintain its roughly $16.5 million authorization, highlighted a simplified asset allocation and reported about $4 billion in excess value above benchmark since a 2020 reallocation.
Mike Hitchcock, representing the Retirement System Investment Commission, told the Constitutional Subcommittee of the House Ways and Means Committee in 2025 that the commission is asking the General Assembly to maintain last year’s authorization of roughly $16,500,000 rather than increase it.
The request came with a summary of recent portfolio changes and performance. Hitchcock said the commission simplified its asset allocation in 2020 from about 18 asset classes to five and that “over the past 4 years … our staff has added a $4,000,000,000 in excess value above our commission’s investment benchmark and it's cost us about $50,000,000 to operate.” He told members the commission manages the funds on behalf of roughly 650,000 beneficiaries and is requesting authority, not appropriations, because the activities are funded by the trust funds the commission manages.
Hitchcock described the simplified allocation targets as roughly 46% public equity, 26% bonds, 12% real assets (public and private real estate and infrastructure), 7% private debt and 9% private equity. He said the change let staff focus resources on a smaller number of asset classes that have driven recent outperformance.
On provisos, Hitchcock asked the committee to: update a date reference that suspends a fiduciary audit requirement; retain an exemption from procurement for the commission’s custodial banking arrangement while the commission runs an RFI for custodial services; and delete a proviso added last year that required the commission to present a one-time report to the General Assembly (he said that report has been submitted and the proviso is no longer needed).
Committee members asked for details about where the portfolio allocations were changed and about the role of the 2017 pension reform. Hitchcock credited the 02/2017 pension reform bill for moving amortization schedules and funding assumptions, saying it has had a substantial positive fiscal impact. He reported that, as of the 2024 actuarial valuation, the system’s amortization has fallen from an expected 23 years to 14 years for the South Carolina retirement system and 13 years for the police officers’ system — “9 to 10 years ahead of schedule,” he said.
No formal vote was taken; Hitchcock’s presentation was received as informational and the commission’s requests were presented for committee consideration.
