El Paso employees retirement trust posts fiscal‑year gains; managers outline bond, private equity positioning

At a Sept. 17 regular meeting, the City of El Paso Employees Retirement Trust reported net assets available for benefits of approximately $1,057,000,000 for the fiscal year ended Aug. 31, 2025, and heard investment reports from BlackRock, Future Standard (the rebranded Portfolio Advisors) and Kellan LLC.

The numbers were presented by Louis Meyer, who presented the treasurer’s report showing that total cash and investments were roughly $1,053,000,000, up about $22,000,000 from the prior month. Meyer said net investment income for the year was approximately $92,000,000 and that total receipts for the 12 months were about $63,000,000. After deductions — benefits paid to retirees of roughly $83,000,000 and refunds of about $4,300,000 — the trust recorded a year‑to‑date net increase of about $66,000,000.

"Total cash and investments was approximately 1,053,000,000, which is up 22,000,000 from the prior month," Meyer said while reviewing the statements of net assets and the statements of changes in net assets available for benefits.

Nut graf: Trustees were told the plan’s fiscal‑year return exceeded its 7.25% actuarial discount rate, a central measure of funded‑status progress; managers and consultants used the meeting to explain recent performance drivers and portfolio positioning going into the current quarter.

BlackRock update

Braden Nolan, a member of BlackRock’s institutional team, and Greg Kirk of BlackRock reviewed the trust’s core fixed‑income allocation. Nolan reported that the fixed‑income portfolio was ‘‘up just over 5.8% through August’’ on a net‑of‑fees basis and that the team had modestly outperformed the benchmark year‑to‑date. Nolan said BlackRock had positioned the portfolio to harvest income in securitized sectors and an out‑of‑benchmark allocation to high‑yield credit while maintaining a duration profile that hedges spread exposure.

"We generally came into the year positioned to take advantage of ... income that would help us perform," Nolan said, adding the team expected the Federal Reserve to begin cutting rates and had been positioned with an overweight to the front end of the curve as a hedge. When asked, BlackRock reported the portfolio duration at about 5.9 years, roughly in line with the benchmark.

Private equity: Future Standard (Portfolio Advisors)

Greg Garrett, who presented for Portfolio Advisors under its new brand Future Standard, updated trustees on the trust’s private equity investments. Garrett said the more mature private equity funds in the trust’s portfolio have delivered above‑benchmark long‑term returns and that distribution activity has started to pick up after several quieter years.

Garrett reported that a set of mature funds had generated roughly a 15.3% net internal rate of return and that distributions to the plan over the life of those funds have been significant; he said distributions from some funds were expected near the end of the month. He also told trustees that newer funds remain early in their investment cycles and therefore show limited realized performance to date.

Kellan LLC: total‑fund review

Alex Browning of Kellan LLC presented the monthly performance review through Aug. 31, which Kellan said closed the fiscal year on a ‘‘highly positive note.’’ Kellan reported estimated total‑fund returns that outpaced the plan’s actuarial discount rate for the fiscal year and highlighted relative strength in international equities and in active fixed‑income management (BlackRock and Wellington) as contributors. Browning also noted a fiscal‑year shortfall in the domestic equity composite versus the Russell 3000, driven by small‑ and mid‑cap manager performance and by structural exposure to smaller capitalizations.

Browning said the investment committee is reviewing structural allocations and manager lineups to address the domestic equity shortfall. He also noted that UBS remains on the plan’s watch list for one strategy.

Board actions and procedural items

The board unanimously approved the consent agenda after a motion to adopt was made by Trustee Renee Pena and seconded by Trustee Matt Kerr; members present voted ‘‘aye’’ during a roll call. Separately, the board voted to table item 10 for one month on a motion by Carl (last name not specified in the record), seconded by Trustee Hamlin; a recorded roll call on the tabling motion returned unanimous ‘‘aye’’ votes from trustees who were polled.

Votes at a glance

- Approval of consent agenda: motion by Renee Pena; second by Matt Kerr; roll‑call votes recorded as ‘‘aye’’ by members on the record; outcome: approved. - Motion to table item 10 for one month: motion by Carl; second by Ms. Hamlin; roll‑call votes recorded as ‘‘aye’’ by Ms. Valdez, Ms. Carrasco, Mr. Kerr, Mr. Remkus, Mr. Pena, Rep. Canales and Rep. Fierro; outcome: approved.

Other business and next steps

Staff and trustees discussed a disqualified audit RFP that is being reissued with a short deadline, recruitment for a retiree benefits clerk (interviews in progress), and a strategic planning meeting scheduled for Oct. 29 from 9 a.m. to 1 p.m. The executive director referenced ongoing monitoring of state legislation (Senate Bill 12 and 13) and said staff were prepared to seek an amendment to exclude public pension plans if a similar bill is reintroduced in a potential third special session.

The board adjourned at 9:35 a.m.