Illinois TRS Approves $2.7B Pension Contribution

October 28, 2011 ( - The Illinois Teachers’ Retirement System Board of Trustees has approved a $2.703 billion state funding amount for fiscal year 2013.

According to a news release, this is the money required by state law to fund TRS pensions during the coming year, as well as a payment on the System’s unfunded liability, which currently stands at $43.5 billion. The System’s unfunded liability increased slightly to 53.5% during FY 2011 from the previous mark of 51.6% at the end of June, 2010.   

The System says the increase in unfunded liability is due mainly to the lingering effects of the 2008-2009 worldwide financial crisis on investment earnings; however, it was mitigated by strong investment earnings of 24% during FY 2011. Total TRS assets grew during FY 2011 by $6.1 billion to $37.4 billion. Total TRS revenue from all sources was $10.5 billion.  

The $2.7 billion state contribution for FY 2013 is $297 million higher than the current year’s contribution of $2.4 billion. State government is expected to pay the entire year’s contribution before the end of the fiscal year. State law requires TRS to annually certify an amount for the state contribution by November.  

In other news, the Board approved the issuance of a formal “Request for Proposal” for outside financial firms to provide transition management services. Transition management is the day-to-day administration of trading stocks and bonds during the rebalancing of portfolios or other changes. Following the RFP and evaluation process, TRS staff expect to provide a recommendation to Trustees in February of 2012.  

The System serves 362,000 members and had assets of $37.5 billion as of June 30, 2011.