Contra Costa County Employees' Retirement Association Concord, Calif. lowered its expected rate of return to 7.25% from 7.75%, confirmed Marilyn Leedom, the $5.6 billion pension fund's CEO, on Friday.
The action by the pension fund's board on Wednesday gives the Contra Costa fund the distinction of having the lowest rate of return, along with the $9.9 billion Orange County Employees Retirement System, Santa Ana, Calif., among the 19 so-called independent retirement systems in the state.
The Segal Co., the Contra Costa pension fund's actuarial consultant, said there was a 53% chance that the pension fund on average would be able to achieve the 7.25% return over a 15-year period.
Segal also had given board members an alternative recommendation of lowering the rate of return by a quarter percentage point to 7.5%. But Segal in its report said there was only a 50% chance on average that rate could be achieved over a 15-year period.
