Growth Pushes Florida Retirement System Above $163 Billion in Assets

The State Retirement System earned a clean bill of health during its regular checkup Monday by overseers on the Florida Investment Advisory Council.

Assets have grown by 10.5 percent since the start of the fiscal year, reaching a balance of $163.3 billion — $9.8 billion ahead of last year.

The state distributes benefits worth between $600 million and $800 million per month, said Ash Williams, executive director and chief investment officer for the State Board of Administration. That panel, comprising the governor, attorney general, and chief financial officer, oversees the council.

Furthermore, the council is managing as much as 44 percent of its assets in-house, the result of a decade’s efforts to contain management costs, Williams said.

“The pension plan in the state of Florida is in pretty good shape, being well managed,” said Gary Wendt, the former chief executive of G.E. Capital, who formally became the council’s chairman during the meeting in Tallahassee.

“We rank very highly versus our peers, and we’re beating all the benchmarks. We’re very happy, very pleased with what’s happening,” Wendt said.

The council meets quarterly to review the governance of the funds under its authority, including the Florida Retirement System; the Lawton Chiles Endowment Fund, which promotes child health and welfare; the Florida Hurricane Catastrophe Fund, a state-sponsored reinsurance pool; and Florida Prime, an investment pool for local governments.

The Prime fund was valued at $11.6 billion as of March 31, according to a consultant report delivered to the council.

An earlier iteration of the fund tanked during the financial crisis, forcing state leaders to freeze $2 billion in asset-backed securities in November 2007. The Legislature also suspended one month’s interest distributions to local governments.

“Which has been a huge sore spot with those local governments ever since,” Williams said.

Florida Prime replaced that fund, and is running on much firmer footing, he said.

“We were able to take that $2 billion pool that was originally perceived to be lost money and return all of it to the local governments that invested it,” Williams said.

“We were able to not only give their money back that they thought they had lost, but we have given them roughly half of what their November interest would have been back in 2007,” he said. Additionally, the fund waived one year’s fees for participating local governments.

“The local governments, I think, finally have put their pitchforks and torches away,” Williams said.