Public Retirement & Social Security Programs-Joint

Call this meeting of the retirement committee to order. First item up is consideration of a motion to approve the April eighteenth two thousand twenty two minutes. Got a motion. All right second all in favor say aye. Any oppose same sign motion carries. next up we have. The review of Arkansas state police retirement system rule eleven The interim director Allison would you're here if you would please come to the table. Introduce yourself. Yes ma'am all. We can do that under other business. Yes ma'am. If you would recognize the introduce yourself and you're recognized to present. Good morning announcing was an interim director at a at a pers and today we're here because we're amending the state police are retirement system rule eleven. And this is a response to act for fifteen of twenty twenty one that there were several items in it in that act but uh It change the drop participation requirement service requirement from thirty years to twenty eight years and in this rule contained that that thirty year numbers we're changing that that's one of the substantive changes and then the second is just updating that regarding the interest on the the drop account they're just within a language in there and so we're we updated that to indicate that the interest is applied is is by law in the our fortress dis determines with that interest rate is so those are the two main things that we were amending and that in that law that said are there any questions. Members do you have any questions. Are we have a motion to move for the rule change. Okay charge just a review for us so. Prove the rule change I mean of approved the. The rule has been review. Right get it straight year. All right. Any other discussion. All right. Thank you else. All right let me go ahead and S. the The executive directors if you guys will come forward. And while we're doing that or let me do this before we have a new executive director as of July first Amy Thatcher who is it has been over transformation as of July first will be the new executive director for papers so we're glad to have you Amy and I look forward to working with you so if you want to come for religion in on the conversation if you'd like to stay back there and say you're not in. In the seat yet I understand that too so. Okay that sounds great good to have you coming on board in a July. And Steve Osborne. Come on up. We can added share. Okay we'll let you be right there in or if you wanna bring that chair up to the table. Okay take that out. He's got it. Hello. All right so. The center Chesterfield you're recognized to ask your question thank you Mr chairman thank you all for being here this morning for all you do I am aware of the stock market is going **** nilly and so much of what we do is tied to the market so much of the health of our organizations are tied to that so I was just like a brief update on where we stand as a result of this what is he heading to not to a bull market was the other one a bear market a I'd love to to know where we stand right now. Good morning Clint Rhoden Arkansas teacher retirement system of I'll start out this morning you know obviously stock markets going down is a very big concern Fortunately we're coming at in this year after a stock market that was released exploded last year last year ATI's had a thirty one percent gain on its assets. So that actuarially we don't get to take credit for that whole thirty one percent in one year that spread out over four years the most important thing is it spread out over this is one of the next three years that it spread out over so with that being said our. Investment consultants just last month give us our may report and we're pretty much had a zero percent as of the end of may that's not to say what last week is done you know. If we end up somewhere in the you know small negative digits return this year that puts kind of big to be expected you know especially after coming off a thirty one percent gain in one year that's kind of what we're looking at but of course that will gets moved in so actuarially issue will not look as bad as it feels like today. Thank you any questions I'll be glad to take no. May meet some members of that particular one yes. You senator Hammer you had a question for thank you Mr couple couple things. A couple things one. We'll get connected I'm sorry I thought you said you through no with him okay. These can. Okay I need to be able to finish getting the answers from the other ours is pretty much the same as clients I will say at the beginning of the year we raise some cash that we put aside so that kinda helped us but what private in the negatives as well so initially or not substantially we were ahead of our peers at our last meeting we were in a negative point two point nine and they were like at negative four point nine so we are doing well comparatively but at this point we're just kinda looking at places to put that cash back to work robin so let me interrupt for sorry the introduce yourself sorry it's been a long time okay. Robin Smith Arkansas State Highway employees retirement system like so what we're doing pretty well right and and like he said we had a good return last year ours was a little over twenty nine percent and the same thing the smoothing helps us there just like it does when it's a negative year with me that in so it's not as big a hit. Hi the other group to which I am a member a purse. Allison was interim director of of apers and and guess we're all the same apers are also under the four years moving so that in the finest you know to reduce the volatility we're actually we're actually still in it in a pretty good position are fun value is you know it's still high compared to where it's it's been in the last decade we our immunization period is that the one of the lowest it's ever been right now we have a sixteen year amortization period which means that you know we would pay off are unfunded liabilities in sixteen years compared to you know at the highest it had been thirty years as far back as is two thousand nine so and that's the you know our investment consultants are you know pretty early and took a job of helping us review our in our portfolio is is well is diversified we've been starting maybe about the last year to reviewing each asset classes unity of the something that we do regularly but we're we're actually in pretty good position right now despite that and they reminded all of our boards all three of them that you know public employees state police and judicial that this is we look at the long term and we just have to write these things out sometimes thank you is the actuary. The nine Jodi actuary. I'm Steve Osborne I want your actuaries you usually see the younger Jody but you have me today I thank you in addition to the smoothing of some of the systems took the opportunity of the good return last year to make their assumptions a little more conservative so that while any kind any of these losses are painful will be as painful as they would have been without these assumption changes thank you thank you Mr well and let me let you guys know David Clarke with lot the did let us know that he had scheduling conflicts of that's why he's not here today. A representative right you're recognized thank you Mr well for all of our different retirement divisions. overall in this I know that some returns are fifteen sixteen seventeen percent summer two or three percent what do you have to do to make sure that each one of our particular agencies overall with interest rates in return does it have to be around six or seven percent or for what what is it take. To make it come out like it should to make sure we're taking care of all the retiree statewide. I'll attempt to ensure that the the biggest answer I'd have to that is we have a very extremely diversified portfolio there are some some a particularly you know the biggest shock of a terror of portfolio it is equity which is the part that is greatly affected by extreme goodly good years like last year in which we can see double digit returns in one year but then there followed up by you know negative or single digits you know another year so it's a little bit more the volatile area we also happy to invest heavily are you know the other part of our portfolios real estate bonds accept or don't have quite as high interest rates but they're much more secure are you know more steady you know they shouldn't take as big a hit we have the volatility the stock market the short answer is we're just extremely diversified that is the reason that at the end of may we we are actually seeing closer to the zero percent return instead of a like negative ten percent return but the stock market might be at your or I'm saying so it's it's diversification that's the short answer. Follow up please. You're recognized for follow up thank you Sir we'll percentage wise this is a cure the ones that are really secure do you think maybe that's seventy or eighty percent or something like that. Overall now it I mean we have probably seventy percent of our all right of the eight years investment in the inequity and that is just it's it's performance so that we have a long term view. Ten year plus investment plan so that a single year does not affect our investment strategy. So that that's that's the essential answers long term investing you know we're not just dumping everything because stock markets are going down you know they will recover and we're in a position where we can hold our positions HRS pays out about a billion dollars a year in in benefits we have twenty billion dollars worth of assets so with twenty times the amount of you know a good fifteen times the amount of assets to back up the expenses we pay each year so we've got time to ride the situations out calculation Preciado thank you Mr. Any other questions from the members. If not thank you for your presence is warning will stand adjourned. The.