County pension fund also posts 7.9% fiscal-year return
San Diego County Board of Supervisors approved a one-time contribution of $13.8 million to the county pension plan's unfunded actuarially accrued liability, said Mary Montgomery, spokeswoman for the $12.3 billion San Diego County Employees Retirement Association, in an email.
The contribution was credited to SDCERA on Aug. 10. Pension fund officials will not know the impact the contribution has on its unfunded liability until the fiscal year 2019 actuarial valuation. SDCERA's unfunded liability was $3.37 billion as June 30, 2017, Ms. Montgomery said.
Separately, SDCERA reported a preliminary net return of 7.9%, compared with its 8% policy benchmark, for the fiscal year ended June 30. The pension fund earned an annualized return of 6.7% for the three years ended June 30, meeting its policy benchmark; 7.2% for the five years, exceeding the 7.1% benchmark return; 5.2% for the 10 years vs. 5.7%; and 6.6% for the 20 years ended June 30. A policy benchmark was not provided for the 20-year period. SDCERA earned a 12% net return for the fiscal year ended June 30, 2017, underperforming its policy benchmark for that year of 12.5%.
Private markets led the fiscal-year returns at 11.3% vs. a 10% benchmark, while public equity returned 10.7%, underperforming the benchmark return of 11.1%; opportunistic earned 4.3% vs. a 7.7% benchmark; return-seeking fixed income returned 2.5%, matching the benchmark; and risk-reducing fixed income earned 0.3%, exceeding its benchmark return of -0.3%.
SDCERA's target asset allocation is 18% each U.S. equity and risk-reducing fixed income; 15% non-U.S. developed equity; 9% each emerging markets equity and real estate; 8% each opportunistic and private equity; 6% each return-seeking fixed income and private real assets; and 3% global equity.