Employees Retirement System reports $500 million installment will raise funded ratio toward 80% goal

Jim Potvin, executive director of the Employees Retirement System of Georgia, told the Education Budget Subcommittee that the system received a first $500 million installment and a second similar installment is proposed in the FY 2024 budget.

Potvin said the installments are being used to reduce unfunded liability and described the required actuarial contributions as "the ADEC." He said each $500,000,000 installment "reduces directly the funded liability by almost 10%." Potvin estimated that, from a 72% funded ratio before the first payment, the system's funded ratio would improve "to about the 75 or 76% range" after the second installment and that the stated objective is to reach an 80% funded ratio as quickly as possible so cost-of-living adjustment calculations would improve as a result.

Potvin also reported recent investment returns as a contributing factor: "We've had 2 straight years of double digit returns. And this year, we're at about 7.2 percent 7 months through the year." He said continued positive investment performance would further help funded-ratio improvements.

Committee members did not record formal questions that altered the presentation; Potvin closed by offering to take questions from the committee. No formal vote or motion on the installments was recorded in the transcript excerpt.

The discussion consisted of a staff presentation of budget-line changes and actuarial expectations; the transcript did not record a formal committee action or a precise new actuarial valuation showing the updated funded ratio.