California's public pension posts 18.4 percent return on investments in 2014 fiscal year

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LOS ANGELES — California's pension fund for state workers exceeded expectations by posting an overall 18.4 percent return on investments for the 2014 fiscal year.

The rate of return was far above the official 7.5 percent goal set by the board of the nearly $300 billion California Public Employees' Retirement System, the Los Angeles Times said (http://lat.ms/1yjO5hi ).

Chief Executive Anne Stausboll hailed the performance for being "the fourth double-digit return" in the past five years.

CalPERS said in a report Tuesday that strong financial results including bullish stock markets helped boost its funding level to 77 percent for the year that ended June 30. That's up from about 70 percent a year earlier.

The fund has grown by nearly 83 percent since its low of $164 billion at the bottom of the global financial crisis in 2009, Stausboll said.

Still, critics said that at less than 80 percent funding, CalPERS could lack money it needs to meet current and future pension obligations to state and local government workers and retirees. Workers and their employers should be paying more to ensure there will be enough money for about 1.7 million current and future retirees and their families, they argue.

Dan Pellissier, president of a Sacramento group called California Pension Reform, welcomed CalPERS' investment success but said he remains wary of the fund's claim to be in good shape to meet all obligations.

"The fact that they've had these remarkable returns for the last 20 years and they're still under 80 percent funded means that the governance of CalPERS is the problem," Pellissier told the newspaper.

Many pension experts consider an 80 percent funding level adequate, though pension skeptics contend that it should be closer to 100 percent, the Times said.


Information from: Los Angeles Times, http://www.latimes.com/

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