State Pension Fund Earns 14.6% In Last Fiscal Year

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The state pension fund earned a 14.6 percent rate of return for the fiscal year that ended in March, a return less than in 2010 but higher than in previous years, Comptroller Thomas DiNapoli announced this morning.

The state pension fund, which pays benefits to about 350,000 state retirees and has 650,000 members who are still working, has had wide swings in returns in recent years due to the volatility of the stock market.

The 14.6 percent increase in the 2010-11 fiscal year followed a 26 percent return last year, the third best performance in 20 years. But in 2009, the fund fell 26.3 percent.

DiNapoli suggested the fund has stabilized, with an estimated value of $146.5 billion, the highest since the economic downturn three years ago.

“The fund remained resilient during a tough economic period,” DiNapoli said in a statement. “We’ve come a long way back. The strong returns should reassure our beneficiaries and New York taxpayers that the fund is strong and sustainable.”

The success of the pension fund is critical to local and state governments. Pension costs have skyrocketed in recent years because of the downturn on Wall Street and more workers retiring.

Pension costs for state and local governments will increase by 37 percent in 2012. The contribution rates by local governments to fund the state’s Employee Retirement System are rising from 11.9 percent of a municipality’s total salary to 16.3 percent in 2012.

“There still are reasons to be cautious about the ongoing recovery, but the results are a good sign that the Fund has weathered the worst of the downturn. We’re on the right course,” DiNapoli said.

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