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Portsmouth retirement board: pension about 75% funded; actuarial contribution to rise to ~$8.9M for FY26
Summary
Actuarial and investment consultants told the council the closed retirement system holds about $200 million in assets and is roughly 74–75% funded; the actuary recommended an actuarially determined contribution near $8.9 million for fiscal 2026 and said liability changes from a new mortality table raised the contribution roughly $750,000.
City retirement-system advisers presented a fiscal snapshot to the Portsmouth City Council on Dec. 9, saying the closed defined-benefit system (fire, police and supplemental plans) held about $200 million in trust and was approximately 74–75% funded as of the June 30, 2025 valuation date.
A Morgan Stanley actuarial presenter summarized the valuation and funding policy: the plan’s actuarially determined contribution (ADC) for fiscal 2026 is approximately $8.9 million (not including an $11 million pension-obligation bond payment that is separate), and the plan’s remaining unfunded gap—roughly $70 million—was being amortized on the current schedule over about 11 years under existing policy. “As of 06/30/2025, we’re about 75% funded,” the presenter said. He added that an update to the Society of Actuaries mortality table in 2025 increased liabilities and raised the ADC by roughly $750,000.
Councilors asked how targets and payment schedules would change under alternative funding goals; the actuarial presenter said lowering the full-funding target (for example, to 90%) would reduce near-term contributions but delay the date of full funding. Under the current policy the plan targets 100% funding by about 2037.
Brian of Greystone (the retirement-system investment consultant within Morgan Stanley) described the portfolio allocation—roughly 70% public equities, a bit over 20% bonds, and about 8% alternatives—and said the consultants operate under a discretionary mandate to rebalance within policy ranges. He reported a net plan-year return of about 11% for the 12 months ending 06/30/2025 and said multi-year performance since 2016 averaged roughly 8.2% net of fees.
Council members requested follow-up data showing the distribution of monthly benefit payments (how many retirees receive various ranges), counts of retirees vs. beneficiaries, and an age distribution of participants; the actuarial team agreed to provide those details to the council for budgeting and policy review.
What happens next: staff and the retirement board will provide the requested distributions and continue to present annual valuations and investment updates; no changes to benefits or automatic COLA were adopted at the meeting.
