Public School & Education Employee Retirement Systems of Missouri Comprehensive Annual Financial Report for the Fiscal Year Ended June 30, 2021

2021·8.3 MB·English

by  Public School Retirement System of Missouri, Public Education Employee Retirement System of Missouri

Annual Comprehensive
Financial Report
for the fiscal year ended June 30, 2021
PSRS
YYeeaarrss
1946-2021
Making a Positive
I I
on Our Employers
PUBLIC SCHOOL & EDUCATION EMPLOYEE
RETIREMENT SYSTEMS OF MISSOURI
Annual Comprehensive
Financial Report
for the fiscal year ended June 30, 2021
PSRS
YYeeaarrss
1946-2021
Dearld Snider
Executive Director
PO Box 268
3210 W. Truman Blvd.
Jefferson City, MO
65102-0268
[phone] or
[phone]
www.psrs-peers.org
Prepared by PSRS/PEERS Staff
Photography: Renette Reiske
Making a Positive
on Our Employers
UBLIC SCHOOL & EDUCATION EMPLOYEE
RETIREMENT SYS1Q1S OF MISSOURI
►TA BLE OF CONTENTS SECTION
INTRODUCTORY SECTION
Mission Statement, Goals, Focus Areas .................................................................................................................4
Economic Impact ....................................................................................................................................................5
Board of Trustees ....................................................................................................................................................6
Administrative Organization ..................................................................................................................................7
PSRS Celebrates 75 Years .......................................................................................................................................8
Transmittal Letter .................................................................................................................................................10
Certificate of Achievement for Excellence in Financial Reporting ......................................................................14
Public Pension Coordinating Council Public Pension Standards Awards ..........................................................15
Professional Services .............................................................................................................................................16
FINANCIAL SECTION
Independent Auditors’ Report from Williams Keepers, LLC .............................................................................17
Management’s Discussion and Analysis ...............................................................................................................19
Basic Financial Statements ...................................................................................................................................26
Statements of Fiduciary Net Position ............................................................................................................26
Statements of Changes in Fiduciary Net Position .........................................................................................27
Notes to the Financial Statements .................................................................................................................28
Required Supplementary Information .................................................................................................................52
Schedules of Changes in the Employers’ Net Pension Liability ....................................................................52
Schedules of Employers’ Net Pension Liability .............................................................................................54
Schedules of Employer Contributions ..........................................................................................................55
Schedules of Investment Returns ..................................................................................................................55
Notes to the Schedules of Required Supplementary Information ................................................................56
Staff Retiree Health Plan - Defined Benefit OPEB Plan ................................................................................58
Schedules of Administrative Expenses .................................................................................................................59
Schedules of Professional Services .......................................................................................................................60
Schedules of Investment Expenses .......................................................................................................................60
INVESTMENT SECTION
Letter from Verus ..................................................................................................................................................61
Letter from the Chief Investment Officer ............................................................................................................62
Investment Policy Summary .................................................................................................................................66
Total Fund Review ................................................................................................................................................71
Public Risk Assets Summary ................................................................................................................................76
U.S. Public Equity Program Summary .................................................................................................................78
Alpha Overlay Program Summary ........................................................................................................................81
Non-U.S. Public Equity Program Summary .........................................................................................................83
Public Credit Program Summary .........................................................................................................................86
Hedged Assets Program Summary .......................................................................................................................88
Safe Assets Summary ............................................................................................................................................91
Private Risk Assets Summary ................................................................................................................................94
Private Equity Program Summary ........................................................................................................................96
Private Credit Program Summary ........................................................................................................................99
Private Real Estate Program Summary ...............................................................................................................101
U.S. Public Equity Broker Commissions Report ...............................................................................................104
Non-U.S. Public Equity Broker Commissions Report .......................................................................................104
Investment Summary ..........................................................................................................................................105
Investment Expenses ...........................................................................................................................................106
► 2 PSRS/PEERS of MISSOURI 2021 ANNUAL COMPREHENSIVE FINANCIAL REPORT
TABLE OF CONTENTS SECTION ◄
ACTUARIAL SECTION
Certification of Actuarial Results, PricewaterhouseCoopers LLP .....................................................................107
Schedules of Funding Progress ...........................................................................................................................109
Required Contribution Rates and Amortization of Unfunded Liability ..........................................................110
Reconciliation of Unfunded Actuarial Accrued Liability..................................................................................111
Schedules of Active Member Valuation Data.....................................................................................................112
Solvency Tests .....................................................................................................................................................113
Schedules of Retirees and Beneficiaries Added to and Removed from Retirement Rolls ................................114
PSRS Summary Plan Description ......................................................................................................................115
PEERS Summary Plan Description ....................................................................................................................117
PSRS and PEERS Summary of Actuarial Assumptions and Methods ..............................................................120
STATISTICAL SECTION
Statistical Summary ............................................................................................................................................127
Summary of Benefit Recipients by Type .............................................................................................................128
Schedules of Changes in Fiduciary Net Position, Last 10 Fiscal Years ..............................................................129
PSRS Summary of Changes in Membership During 2020-2021 ......................................................................130
PEERS Summary of Changes in Membership During 2020-2021 ....................................................................131
PSRS 2020-2021 New Service Retirees ..............................................................................................................132
PEERS 2020-2021 New Service Retirees ............................................................................................................133
PSRS Schedule of Average Benefit Payments to New Service Retirees..............................................................134
PEERS Schedule of Average Benefit Payments to New Service Retirees ...........................................................135
Comparisons of Actuarial Assets and Total Actuarial Liabilities ......................................................................136
Growth in Membership ......................................................................................................................................137
PSRS Schedule of Covered Employees in the Top 10 Employers ......................................................................138
PEERS Schedule of Covered Employees in the Top 10 Employers ...................................................................140
PSRS/PEERS of MISSOURI 2021 ANNUAL COMPREHENSIVE FINANCIAL REPORT ◄ 3
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PSRS/PEERS partners with 534 employers who, through their participation
in the Retirement Systems, provide their eligible employees membership in a
defined benefit pension plan. PSRS/PEERS membership helps their employees
achieve financial security in retirement.
At the same time, our participating employers are an integral part of
what makes the Retirement Systems so successful. We are proud to
work with each PSRS/PEERS participating public K-12 school
district, community college and educational association to
make a positive impact for them and for our members.
PSRS/PEERS of MISSOURI 2021 ANNUAL COMPREHENSIVE FINANCIAL REPORT
Introductory Section
Mission Statement, Goals, Focus Areas ..........................................................................................................4
Economic Impact .............................................................................................................................................5
Board of Trustees .............................................................................................................................................6
Administrative Organization ...........................................................................................................................7
PSRS Celebrates 75 Years ................................................................................................................................8
Transmittal Letter ..........................................................................................................................................10
Certificate of Achievement for Excellence in Financial Reporting ...............................................................14
Public Pension Coordinating Council Public Pension Standards Awards ...................................................15
Professional Services ......................................................................................................................................16
► INTRODUCTORY SECTION
Mission Statement, Goals, Focus Areas
MISSION STATEMENT
To provide financial security and peace of mind for Missouri’s public education community.
GOALS
To provide retirement To help school districts To manage the Systems in
security to Missouri’s attract and retain the best a prudent and cost-efficient
educators and education and brightest educators manner while continuing to
employees after a full and employees for provide exceptional service
career of service. Missouri’s school children. to our members.
FOCUS AREAS
Culture of
Excellence
System & Financial
Stability
E n
n o
ga a ti
g v
e o
ment I n n
►
4 PSRS/PEERS of MISSOURI 2021 ANNUAL COMPREHENSIVE FINANCIAL REPORT
INTRODUCTORY SECTION ◄
Economic Impact
The benefits distributed by PSRS/PEERS make a sizable contribution to Missouri’s economy and help Missouri
public schools attract and retain quality teachers and education employees.
As of June 30, 2021, approximately 101,000 individuals received benefits from PSRS/PEERS. Total benefits paid
for the one-year period ended June 30, 2021 were nearly $3.2 billion. Of this amount, more than $2.8 billion, or
89%, was distributed among Missouri’s 114 counties, positively impacting the state’s economy.
CO•LO R KEY
•
Less than $1 million
Atchison Nodaway Worth Harrison Mercer Putnam Schuyler Scotland Clark • $1 - $4.9 million
GGeenntrtryy Sullivan
Adair • $5 - $9.9 million
Holt Grundy Knox Lewis
Andrew
Daviess • $10 - $24.9 million
DeKalb Linn Macon
Shelby Marion • $25 - $49.9 million
Buchanan Clinton Caldwell Livingston • $50 - $99.9 million
Chariton Randolph Ralls
Monroe
Platte Carroll $100 million +
Ray
Pike
Clay
Audrain
Howard
Saline y
Lafayette er Lincoln
Jackson Boone m
o
g
Cooper Callaway nt
o St. Charles
Johnson Pettis M Warren St. Louis City
Cass
Moniteau e St. Louis
d
Cole na
Henry Morgan Osage sco Franklin
a
Bates Benton G
Jefferson
Miller
Maries n
o
St. Clair Camden Crawford ngt
Hickory hi Ste.
Vernon Pulaski Phelps Was Genevieve
St.
Cedar
Dallas Laclede Iron Francois Perry
Polk Dent
Barton Reynolds
Dade Madison er Cape
g Girardeau
Texas n
Greene Webster Wright olli
Jasper Shannon B
Lawrence Wayne
Scott
Christian Douglas Carter
Newton Howell Stoddard Mississippi
Barry
McDonald Stone Taney Ozark Oregon Ripley Butler
New
Madrid
Pemiscot
Dunklin
◄
PSRS/PEERS of MISSOURI 2021 ANNUAL COMPREHENSIVE FINANCIAL REPORT 5
► INTRODUCTORY SECTION
Board of Trustees
As of June 30, 2021
The PSRS/PEERS Board of Trustees is
charged by law with the administration
of PSRS/PEERS. Trustees are committed
to providing services to the members and
beneficiaries professionally, promptly,
courteously and efficiently. The Board
meets regularly six times a year, with special
meetings called as necessary.
It is the fiduciary responsibility of those
charged with the administration of PSRS
and PEERS to:
• Effectively collect contributions,
Jason Hoffman, Chair Jason Steliga, Vice Chair
• Prudently invest the assets to obtain Elected PEERS Trustee Elected PSRS Trustee
optimum returns,
• Equitably provide benefits,
• Impartially and in accordance with
applicable law administer the benefit
programs, and
• Set contribution rates that are adequate
to fund promised benefits.
The seven-member Board consists of three
elected PSRS active members; one elected
PEERS active member; and three
governor-appointed trustees, one of whom
must be a PSRS or PEERS retiree. Trustees
serve four-year terms and serve without
Scott Hunt Sharon Kissinger
compensation.
Appointed Trustee Appointed Trustee
Beth Knes Dr. Kyle Collins Dr. Melinda Moss
Appointed Trustee Elected PSRS Trustee Elected PSRS Trustee
►
6 PSRS/PEERS of MISSOURI 2021 ANNUAL COMPREHENSIVE FINANCIAL REPORT
INTRODUCTORY SECTION ◄
Administrative Organization
As of June 30, 2021
Dearld Snider Craig Husting, CFA Bill Betts
Executive Director Chief Investment Officer Assistant Executive Director,
Operations
Board
of
Trustees
r-------------- ---------------7
I Executive I
Director
Dearld Snider
Assistant Executive
Chief Investment Officer
Director, Operations
Craig Husting, CFA
Bill Betts
Director of Director of
Director of Chief Financial General
Legislation and Executive and Board
Internal Audit Officer Counsel
Policy Administration
Jeff Hyman, CPA Anita Brand, CPA Sarah Swoboda
Maria Walden Jennifer Martin
Director of Director of Director of Director of Chief Technology
Communications Human Resources Employer Services Member Services Officer
Susan Wood Kim Harris Stacie Verslues Nicole Hamler Lisa Scheulen
◄
PSRS/PEERS of MISSOURI 2021 ANNUAL COMPREHENSIVE FINANCIAL REPORT 7