Oklahoma City post-employment trust reports strong first-half returns; trustees renew contracts and ratify claims

Oklahoma City — The Oklahoma City Post Employment Benefits Trust on Aug. 13 received a quarterly investment report showing strong first-half performance and unanimously approved a series of routine contract renewals, a trustee travel authorization and the ratification of claims.

The trust’s June 30 report, presented by Jason, showed the portfolio ending June at about $120 million and rising to about $121 million in July. Jason said non-U.S. developed-market stocks were the top performer through June, up “almost 19.5%,” while the S&P 500 was up about 6% year to date. Emerging markets rose roughly 15.25%, and U.S. investment-grade bonds returned about 4% year to date and about 6% over the prior 12 months. Jason also said the trust’s five-year and 10-year returns were about 11% and 9%, respectively, exceeding the plan’s assumed 7.5% rate used for discounting liabilities.

“The diversification has helped,” Jason said, noting that a weaker dollar contributed to non-U.S. performance and that small-cap stocks had recently rallied after lagging earlier in the year. He also said the trust earned about $64.1 million in investment earnings over a 10-year period and that peer rankings were favorable in part because of a historical overweight to U.S. large-cap stocks.

Why this matters: The trust funds post-employment benefits and its investment performance and contract decisions affect the city’s ability to meet future obligations to retirees and other beneficiaries.

Trust staff reported changes to the plan’s implementation and targets made over the last year: a target allocation of 35% to U.S. large-cap (implemented passively via a Fidelity vehicle), 15% to U.S. small cap (Russell 2000), 20% to non-U.S. equity (ACWI ex U.S.) and 30% to core fixed income (Bloomberg Aggregate). The report said the trust increased the non-U.S. equity target from 10% to 20%, removed dedicated mid-cap managers, added a small-to-mid-cap value strategy and funded a growth-oriented non-U.S. manager (Chautauqua) in July. The consultant also noted an annual custodian fee savings of about $26,500 negotiated earlier in the year.

Board actions: The board handled several consent and action items by unanimous vote. Those actions included approval of minutes for May 14 and May 29; acceptance of the quarterly investment report for the period ending June 30; approval of monthly investor reports for May, June and July; renewal of actuarial services with Nihart; a one-year audit contract extension with Allens Gibbs Hulick, LC; renewal of an investment consulting agreement with Asset Consulting Group LLC; authorization of travel expenses for Trustee Berry to attend the Oklahoma Public Fund Trustee Education Conference; and ratification of claims from April 30 through July 29, 2025. Each motion passed unanimously with no recorded dissents.

Votes at a glance - Approval of minutes (May 14 and May 29): passed unanimously. - Item 3(a), quarterly investment report (period ending 06/30/2025): received/approved, passed unanimously. - Item 3(b), monthly investor reports (May, June, July): passed unanimously. - Item 3(c), renewal #4: agreement with Nihart for actuarial services, estimated cost $21,000, retroactive 07/01/2025–06/30/2026 (fourth of five option renewals): passed unanimously. - Item 3(d), amendment #3: restated audit contract with Allens Gibbs Hulick, LC to include FY24–25 audit services, estimated cost about $27,604 (one-year extension, increase ~ $1,300): passed unanimously. - Item 3(e), renewal #1: agreement with Asset Consulting Group LLC for investment consulting, estimated cost $45,000 for 08/12/2025–08/11/2026 (first of four option renewals): passed unanimously. - Item 3(f), authorize travel expenses for Trustee Berry to attend Oklahoma Public Fund Trustee Education Conference: passed unanimously. - Item 3(g), ratify claims from 04/30/2025 to 07/29/2025: passed unanimously.

Discussion and context: The investment presentation emphasized diversification benefits after a long period of U.S. large-cap leadership. Jason explained that currency moves explained about 40% of the recent non-U.S. outperformance, with the remainder reflecting company performance in local markets. He also noted that small-cap indices include many companies without positive earnings, which can cause volatility and make it harder for active managers to match index moves.

Trust engagement during the meeting was brief; trustees asked no substantive follow-up questions after the presentation. Staff and trustees indicated the recent portfolio rebalancing and manager changes had been implemented and that monitoring would continue. The meeting adjourned with no further public comment.

Ending: The trust’s next routine monitoring will continue under the revised policy benchmarks and with the newly funded managers in place; trustees did not schedule additional public actions at the Aug. 13 meeting.