The Senate Committee on Ways and Means
Friday, February 23, 2018
10:30 AM, Conference Room 229
RE: SB 2765 SD 1, Relating to Investment Personnel of the Employeesʻ Retirement System
Attention: Chair Donovan M. Dela Cruz, Vice Chair Gilbert S.C. Keith-Agaran and members of the Committee
The University of Hawaii Professional Assembly (UHPA) urges the committee to support passage of SB 2765 SD 1.
UHPA had the opportunity to meet with the ERS Actuarial Consultant, Gabriel, Roeder, Smith & Company (GRS), to go over the most recent actuarial valuation report. In our discussion, we confirmed with GRS that having a robust and functional investment team provides the appropriate resources to support the funding needs of the current and future liabilities. A robust investment team will ensure that the investment returns are maximized when the financial markets are performing well, and will help protect against investment losses when the financial markets are struggling.
The investment team has performed exceptionally well over the past seven years helping stabilize the financial situation and decrease the timeline to full funding, despite actions by the Board that have dramatically increased the unfunded liability forcing a dramatic increase in employer contributions over the next three years.
The amendment to the measure places the responsibility of hiring investment personnel and investment professionals with the Board of Trustees, rather than the executive director, which is in alignment with other agencies such as the Hawaii Employer-Union Trust Fund (EUTF).
UHPA supports the passage of SB 2765 SD 1.