Wednesday, July 26, 2017

"Preliminary Reports Show TRS Investments Improved Over Prior Fiscal Year"

“A preliminary analysis indicates that TRS investments will perform better in fiscal year 2017 than they did in fiscal year 2016 due to a booming stock market and an improving economy. On March 31 – three-quarters of the way through fiscal year 2017 – TRS investment returns were a positive 8.84 percent, net of fees. During fiscal year 2016, TRS returns at the end of three quarters stood at a negative 1.87 percent, net of fees. These results continued an upward trend in returns recorded by TRS within the last year.

“On Dec. 31, 2016 – the midway point in fiscal year 2017 – returns stood at a positive 4.64 percent, compared to a negative 2.74 percent at the same point in fiscal year 2016. For calendar year 2016, TRS investment returns were a positive 7.59 percent. In calendar year 2015, TRS investments returned a positive 1.07 percent. All returns were net of fees.

“On March 31, 2017, TRS had $47.3 billion in assets. A year ago, the System had $43.8 billion and finished fiscal year 2016 with $45.2 billion. In addition, TRS is on schedule to receive its entire $4 billion state government contribution for fiscal year 2017. Each year the contribution is received in 12 installments.

“Yet, despite the good news that TRS will receive its entire fiscal year 2017 contribution, the $4 billion falls $2.08 billion short of a contribution that the TRS actuaries would label as 'full funding.' State government has underfunded TRS every year for more than 75 years. In fiscal year 2017, the state contribution should have been $6.07 billion. This chronic underfunding is the main cause of the System’s $71.4 billion unfunded liability” (TRS of Illinois).

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