“Our pension funds remain very well funded,” Russo said. “We have been on the right track, and we continue to be on the right track, in all of our plans.”
Records show that the main Public Employees Retirement Fund (PERF) was actuarially funded at 82.7% as of June 30, even after adjusting for the lower expected return on investment, while the Teachers Retirement Fund (TRF ) prepaid was 94.9% funded.
Typically, pension funds aim for a funded status of at least 80% to ensure that enough money will be available to pay all promised benefits. Funding typically comes from contributions from employers and employees, as well as from investment returns.
The state pay-as-you-go teachers’ pension fund for teachers who started working before 1996 (TRF before 1996) was funded at 31.6% on June 30, according to records.
About $ 1 billion in state appropriations covered the costs of last year’s benefits for retired teachers in this program.
Russo expects state funding for the pre-96 TRF to be no longer needed from 2034, instead of 2037, after lawmakers agreed this spring to funnel much of the surplus revenue from Indiana into the retirement account and as the number of plan members continues to decline with membership. deaths.
“For those of you who are here in 2034, I’m sure you’ll have all kinds of people on your doorstep with all kinds of great ideas on what to do with this money,” Russo told the legislative panel. .