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Retirement System reports March market dip, $100M withdrawn year‑to‑date; CEO says hotel‑sale bill could supply funds with amendment
Summary
Board heard that the system’s plan fell about 3.9% in March and had an ending market value of about $480.2 million; the treasurer said $100 million was withdrawn from investments year‑to‑date. The CEO said a bill tied to a hotel transaction could provide proceeds if amended.
The Government Employees Retirement System’s investment and finance reports at the April 23 board meeting showed a March decline in market values but year‑to‑date resilience, and trustees discussed a potential legislative funding source tied to a hotel transaction.
The investment officer told the board the total plan returned about -3.9% for March but was up roughly 1% fiscal year‑to‑date. Domestic equities were one of the weaker performers in March while the energy sector was the month’s standout. The officer said international equities underperformed in March but remained positive fiscal year‑to‑date.
Mr. Henderson, the treasurer, reported that the system had withdrawn approximately $100 million from the investment portfolio year‑to‑date and that administrative expenses were running at about 39% of budget. The plan’s market value at March 31 was reported at approximately $480.2 million, with an unrealized depreciation of about $20 million.
Trustees asked how staff decide which asset classes to draw from for benefit payments. The investment officer and Mr. Henderson described a process in which staff communicate cash needs, the investment consultant advises on which buckets to access, and managers execute withdrawals while attempting to rebalance toward policy targets.
Trustee Dorsy queried whether recent testimony and pending legislation could change the system’s asset outlook. The CEO explained the mechanics of a bond financing and a transaction involving the Frenchman’s Reef property and said that, as drafted, Senator Avery Lewis’s bill would direct net proceeds to the system only if the property is sold before the maturity of the bonds. The CEO told trustees he asked for an amendment so the system would also benefit upon full repayment of the bonds; he said the senator’s office received the suggestion positively. “We will not look a gift horse in the mouth — we will take it,” the CEO said, describing the potential proceeds as welcome but noting actuarial modeling is impossible without a sale price.
The board voted to accept the treasurer’s and investment officer’s reports during the meeting. Later the board recessed into executive session to discuss matters involving legal and financial confidentiality.
