READING - The town of Reading’s retirement system showed a “negative return” on investments in 2018 of -1.39%, according to a report issued in recent days by the Public Employee Retirement Administration Commission.
Executive Director John W. Parsons, Esq. noted in a “letter” in the PERAC report, Investment Returns in 2018 did not achieve the lofty levels of previous years. As must be expected, capital market performance fluctuates and its influence by many diverse factors.”
The 2014-2018 annualized figure showed a 5.2% gain and the 1985-2018 figure showed an annualized 9.06% gain, they said, noting much should be viewed over the long haul.
Reading currently has 341 active members in the plan and 345 retired members.
The 2018 Market Value was put at $136.2million.
Parsons noted, “The retirement board investment performance suffered from general market conditions but shared the same fate as other investors.” “This experience supports the actions taken by the commission in gradually reducing the investment return assumptions used in conducting actuarial valuations of the systems.”
Still, Parsons philosophies, “The steady trend of tempering expectations by lowering the investment assumption has positioned our system well for the present and future market environments.”
Parsons and PERAC reflected as recently as 2003, the investment return assumption for 30 of their plans was 8.5% and today “no plan is using that assumption.”
According to the PERAC board, this year 52 plans use an assumption under 7.50%, 102 plans use an assumption under 8.00% and only 2 use an assumption of 8.00%.
Presently, Reading’s “funded ratio” is 73.8% and the year fully funded at this rate would be 2029. The Unfunded Liability comes in at $45.4 million and the total pension appropriation (Fiscal 2019) is at $6 million.
The “average age” of active workers is put at 48 and the “average service” is at 14.1 years. The average age of retired workers is 74, and their average benefit is $30,000.
The number of “disability retirees” comes in at 30.
Currently, the members of the Reading Retirement Board are Chairman Thomas Clough, Sharon Angstrom, Carol Roberts, David Gentile and Joseph Coughlin. The administrator is Colleen Loughlin.