Champaign, IL – The State Universities Retirement System (SURS) Board of Trustees on June 4 voted to decrease their long-term investment return assumption rate from 6.75% to 6.5%, effective June 30. The rate was last reduced in June 2018 from 7.25% to 6.75%. The reduction was made following a review of the June 30, 2017 – June 30, 2020 Actuarial Experience Study presented by Gabriel Roeder Smith and Company. The report is posted at here.
The rate change also impacts money purchase factors used in calculating retirement benefits. The board voted for the change to the money purchase factors and other actuarial tables to take effect July 2, 2022.
Investments
Trustees approved updating SURS strategic asset allocation targets to be implemented over the next several years. Targets are as follows:
| Functional Class | Current Portfolio Target Weights | Target Weights approved in 2018 | Target Weights approved in 2021 |
|---|---|---|---|
| Non-Traditional Growth | 10% | 15% | 16% |
| Traditional Growth | 41% | 25% | 35% |
| Stabilized Growth | 25% | 26% | 17% |
| Inflation Protection | 6% | 6% | 5% |
| Principal Protection | 8% | 8% | 8% |
| Crisis Risk Offset | 10% | 20% | 19% |
Trustees approved commitments of the lesser of $50 million or 10% of total fund commitments to Ember Infrastructure Partners Fund I, and $75 million to Brookfield Strategic Real Estate Partners Fund IV, both subject to successful contract negotiations.
SURS previously committed $35 million each to Brookfield’s Fund II and III. Non-core Real Assets currently represent 2.2% of assets versus a new target of 5%.
The System released two requests for proposals (RFPs); the Proxy Advisory and Proxy Voting RFP, and the Master Custodian and Securities Lending RFP. Deadlines for submitting responses are July 14 and July 19, respectively. More information is available here. The RFPs were issued due to expiring contracts with the current providers. Existing providers are welcome to bid.
Other Business
The board hired search firm Heidrick & Struggles to administer the recruitment process for an executive director. Former SURS Executive Director Martin Noven resigned in February. Chief Benefits Officer Suzanne Mayer has been acting interim executive director since that time.
The board voted to retain Vitech Systems Sub LLC to implement the System’s new pension administration software system and services, subject to successful contract negotiations.
Alliant Insurance Services was approved as property and casualty insurance broker for all lines of coverage and as fiduciary coverage broker for the System, subject to successful contract negotiations.