New York State Common Retirement Fund’s investment return was negative 4.14% for the state’s fiscal year that ended March 31, said state Comptroller Thomas DiNapoli. The fund is valued at $248.5 billion.
The fund’s returns reflect retirement and death benefits of $14.7 billion, which were paid during the fiscal year.
For the prior fiscal year, the fund’s investment return was 9.51% and as of March 31, 2022, the fund was valued at $272.1 billion. Its long-term expected rate of return is 5.9%.
Returns for previous years were calculated at 33.55% for fiscal 2021, negative 2.68% for fiscal 2020, 5.23% for fiscal 2019, 11.35% for fiscal 2018, 11.48% for fiscal 2017, 0.19% for fiscal 2016 and 7.16% for 2015.
“Recent months have been trying for investors, but thanks to the state pension fund’s diverse investments, members, retirees and beneficiaries can rest assured their pensions are secure,” DiNapoli said on Thursday.
As of March 31, the fund had 44.14% of its assets invested in publicly traded equities. The remaining assets were in cash, bonds and mortgages at 21.53%, private equity at 14.61%, real estate and real assets at 13.39%, and credit, absolute return strategies and opportunistic alternatives at 6.33%.
A large part of the strength of the fund is due to state and local governments, which consistently pay their contributions. Contribution rates are determined by investment results over several years along with numerous other assumptions, such as wage growth, inflation, age of retirement and mortality.
DiNapoli is fiduciary for the Common Retirement Fund, which is the third largest in the nation.
It holds and invests the assets of the state and local retirement system on behalf of more than 1 million state and local government employees and retirees and their beneficiaries. It is also one of the best funded plans in the nation.
“Last year, despite the fact that the markets were starting to become a bit problematic, we actually had a very strong return of over 9% and our funded status was over 100% — at 102.9%,” DiNapoli told The Bond Buyer in a podcast recorded in February.
Last month, the comptroller reported local sales tax collections in the state increased by 1.1% in May compared to the same month in 2022. This marked the third month in a row that saw growth of less than 2%. Local collections totaled $1.71 billion in May, up $18.4 million compared to the prior year.
“Modest growth in local sales tax collections could be challenging for local officials trying to maintain fiscal balance,” DiNapoli said. “Being prepared for a slowdown is especially important in this uncertain economy.”
New York City’s sales tax collections increased 3.3%, or $23.6 million, to $744 million, compared to the year before, while city and county collections in the rest of the state fell 1.8% to $862 million.
“There is no doubt that challenges lie ahead, with concerns over a recession and potential interest rate increases,” DiNapoli said, “but the state pension fund is well-positioned to weather these storms.”