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Treasurer Lillard: TCRS healthy but several special funds show structural stress
Summary
Tennessee State Treasurer David Lillard told the committee TCRS assets are strong (unaudited ~$81.1B) and that certain special funds—particularly the Criminal Injuries Compensation Fund—face revenue shortfalls that could drive the fund negative by 2028 without changes.
Tennessee State Treasurer David Lillard briefed the committee on retirement-system balances, special funds and risks. He said Treasury manages about $132.3 billion in total funds and reported an unaudited TCRS balance near $81.1 billion with a roughly 8.5% year-to-date return. Lillard emphasized the long-term nature of pension liabilities and that roughly two-thirds of retirement benefits are paid from investment returns, not fresh appropriations.
Lillard warned that the Criminal Injuries Compensation Fund (CIC) is under stress: state revenue for the CIC has been effectively flat while claims paid have risen, and his slides project the fund could be negative by 2028 unless collections or policy change. He proposed improving transparency of local collections and indicated Treasury may seek legislative changes or pilot programs to identify gaps. "We will go to the point where it is negative in 2028," Lillard said when describing the CIC projection.
