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Employee Retirement System reports funding gains; $500 million injections boost prospect of larger COLAs
Summary
The Executive Director of the Employees Retirement System told the committee ERS's funded ratio was 72% as of June 30, 2023, that the system received a $500 million state investment last year and that a second proposed $500 million could push the ratio toward 80%, a milestone tied to larger cost‑of‑living adjustments (COLAs).
Jim Popvin, executive director of the Employees Retirement System of Georgia (ERS), briefed the joint retirement committee on ERS finances and said the system's June 30, 2023 valuation showed a funded ratio of 72.0%. Popvin told members the system managed about $20.8 billion as of June 2023 and about $21.4 billion as of December 2024 across ERS plans and that ERS assets were roughly $17.1 billion of that total.
Popvin said ERS benefited from a $500 million legislative and governor investment in the prior year and that the governor had proposed an additional $500 million for the current budget. "We were the beneficiaries of an investment on the part of the general assembly and the governor last year of $500,000,000," Popvin said. He added he expected the next formal valuation (completed in April) to show a 3–4 percentage point funded‑ratio increase, which would place ERS in the mid‑75% range and closer to the 80% milestone tied to improved COLA calculations.
Popvin described the ERS portfolio and member makeup: ERS and affiliated plans combined held about $21.4 billion as of December; ERS active membership was about 57,000 employees (up from 52,500 three years earlier); and ERS pays roughly $1.5 billion a year in pension benefits, with about 90% of those payments remaining in Georgia. The average ERS monthly benefit reported was $2,199.
On benefits and COLAs, Popvin said ERS has paid small COLAs in recent years and that hitting an 80% funding ratio would position the system to offer larger adjustments under the formulas ERS uses. "When we hit the 80% mark, we will be in a position to pay better COLAs," he said, clarifying the system was not yet at a level supporting a sustained 3% annual COLA.
Committee members asked for short, directional summaries because the meeting time was limited; Popvin said ERS experienced strong investment tailwinds and so far fiscal‑year returns of about 7% year to date. Popvin also explained ERS's mix included a slightly larger allocation to alternative investments (about 3.5–4%) than TRS.
No committee motion or vote on ERS policy was taken at the hearing; the briefing was informational and committee members signaled they will follow up as valuations and the budget process proceed.
The committee left time for a retirees' group to address the panel after ERS's presentation.
