Wow. I cannot believe how fast time truly does pass. We’ve turned the page on 2018, putting yet another year in the books. Seems just like yesterday that the leadership team here at LAGERS was huddled around sharing ideas of goals and objectives and setting our action plan for 2018. And in what seems a blink of an eye, the year has passed and we’ve already begun setting new goals and projects for 2019. We are a task oriented group here at LAGERS driven by pushing ourselves to do more, do it right and serve our members the absolute best we can. So how’d we do, and what did we accomplish? Here is a quick view of 2018:
Missouri LAGERS continued to administer a top-notch pension plan during the past year by achieving outstanding portfolio performance, introducing new legacy plan administrative services, welcoming 19 new employers into the system, and passing important legislation that will allow more workers access to our plan. All while maintaining focus on excellent customer service and innovative member education. These are all examples of how we are pursuing our vision of "a secure retirement for all."
LAGERS earned a 13.70% net of fees return for the fiscal year that ended June 30, 2018, beating its policy benchmark by 5.76% and its 7.25% assumed rate of return by 6.45% for the year. The returns also exceeded benchmarks for each of the three, five, and ten year periods that ended June 30, 2018. These outstanding returns, combined with a solid funding policy and updated actuarial assumptions helped the plan increase its funding ratio to 95.6% on an actuarial value basis and 99.5% on a market value basis.
LAGERS proposed and passed legislation in 2016 that allows local government agencies with frozen legacy pension plans to choose LAGERS as the administrator. The first legacy plan chose LAGERS as the administrator in July of 2017. This service allows the local government unit to take advantage of LAGERS' size and expertise while effectively removing the local agency from the pension administration business. Our system provides all of the actuarial, legal, compliance, and investment services for the legacy plans. This service is also good for the state as a whole, as it puts these plans on a systematic and secure funding path. LAGERS currently has been chosen as administrator of three legacy plans with more in various stages of the process.
Missouri LAGERS is a multi-employer plan and joining is optional for local government agencies within the state. Eligible agencies continue to seek the security of LAGERS as we welcomed 19 new employers during the fiscal year that ended June 30th.
New legislation (supported by LAGERS) was enacted in August of 2018 that allows Missouri's Soil & Water Conversation Districts the option to join our system. There are 114 of these districts and 86 have indicated initial interest in entering our plan.
While there are many new and exciting things happening at LAGERS, we continue to provide top-tier customer service and innovative member education. Recognizing a need to engage younger workers, LAGERS has begun a campaign that targets early-mid career individuals. This campaign includes on-site "LAGERS Lunch Break" meetings where individuals learn about the value of their pension benefit and how to prepare for financial independence in a relaxed and informal environment.
LAGERS has never been an organization that is content on simply administering benefits. We continue to push to be the best public pension system in the U.S. while maintaining keen focus on serving our members each and every day. This summer will mark my 25th year of service – and I will tell you that our entire team commitment, along with mine, continues to grow – which is what I’m most proud of. We “get it”. We know who we work for and why. When you listen to someone here talk about a member and their work, they truly beam with pride. On behalf of everyone at LAGERS, we wish you the absolute best for 2019!