With focus remaining on the state’s pension systems after financial struggles and reforms, an update from the Kentucky Retirement System (KRS) shows growth and improvement in so far in the fiscal year.
KRS officials told the Public Pension Oversight Board Monday the pension system has seen assets grow by $905 million this fiscal year with investment gains topping $1 billion year to date.
Kentucky Retirement System Executive Director David Eager noted the additional funding the General Assembly and Gov. Matt Bevin have put toward the system and stated the system is also seeing positive investment returns.
At the Public Pension Oversight Board meeting, Eager said returns for the system’s pension and insurance funds are positive so far in 2018.
Following this news, the KRS Board of Trustees met Thursday where they discussed the current status of the system and new investment strategies.
The officials from the Kentucky Retirement System and Kentucky Teachers’ Retirement System (KTRS) told the oversight board Monday both systems are operating with a negative cash flow in 2018 as they struggle with the demand for benefits and the imbalance between current and retired employees. However, they did state the negative cash flow they are experiencing in 2018 are smaller than in previous years.
Another issue facing the state pension systems is a spike in retirements. Eager said KRS retirements are up 1,100 in 2018 compared to 2017, he said, with another spike expected this August. At the KRS Board meeting, trustees discussed the impact of “baby boomer” retirements and higher benefits as a major cause of strain on the system.