State Board of Administration of Florida, Tallahassee, trustees will recommend to the Legislature that it create a "stabilization reserve’’ for the $101 billion pension fund, said Executive Director Tom Herndon. The law would specify that the pension fund, as long as it remains fully funded, set aside a yet-to-be-determined automatic amount as a reserve to protect it against the effects of market downturns. Funding would come from market gains. The system currently holds a surplus of $9 billion over its liabilities, according to its latest actuarial report.
Separately, total fund assets returned 16.62% in calender 1999, besting the target return of 15.1%. All but one asset class outperformed benchmarks.
Domestic equities underperformed by 18 basis points, because of a value tilt, Mr. Herndon said.
