After taking hits for two consecutive years, the state's pension system saw gains well beyond its expected rate of return last fiscal year, officials said.
The Maryland State Retirement and Pension System's portfolio returned more than 14 percent on investments, exceeding the assumed 7.75 percent assumed rate of return, according to the agency. The gains raised the assets of the system to $31.8 billion.
The portfolio had a rough few years, dropping 5.4 percent to $36.6 billion in fiscal 2008 and then more than 20 percent last year to $28.5 billion.
The system is responsible for administering the retirement and pension allowances of more than 116,000 retirees and beneficiaries, as well as the future benefits for more than 251,500 active and former members. Members include state government employees, teachers, law enforcement personnel, legislators, judges and local government employees and firefighters.
The news comes just a week after three top rating agencies affirmed Maryland's long-held "AAA" bond rating, though analysts from two of the firms signaled concern about the state's depleted retirement system.
Moody's called the state's $33 billion system a "credit challenge" and reported that it is funded "at a lower level" than the retirement funds of most other AAA-rated states. The system has 65 percent of the money needed to meet future obligations. The analysts' concerns echo a sentiment raised in February by the Pew Center on the States, which issued a report saying Maryland "has failed to make" significant progress toward properly funding the system.
"This offers further proof to our more than 367,000 members that they can rely on the professional staff of the State Retirement Agency to look after their interests. We should all be pleased with today's announcement," said State Treasurer Nancy K. Kopp, chairwoman of the Maryland State Retirement and Pension System Board of Trustees
The pension fund saw large declines in performance in fiscal years 2001 and 2002 when it dropped to $29.5 billion, then $26.7 billion; it saw its biggest recent gain in fiscal 2007 with a more than 17 percent increase in performance, ending the year at $39.4 billion.
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