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Pennsylvania’s Largest Pension Fund The center of an equally large scandal, FBI investigations, proceedings, conference room rebellions, and huge sums of money.
The story of public school employee retirement plans (PSERS) is vast and complex. Here’s a quick explanation of what you need to know and why you need to worry about it.
what is that?
PSERS is a public school employee retirement fund with approximately 500,000 members, approximately half of whom are public school teachers and have approximately $ 64 billion in assets.
Why does it exist?
Pension and retirement income promises are aimed at attracting and retaining talented professionals to state public schools. Ensuring that the fund keeps its promises is left to the PSERS investment manager and the board of directors of the fund’s 15 members.
In December, the PSERS board of directors learned that the average annual return on investment over the last nine years was 6.38%. This is high enough to avoid the state-mandated increase in contributions by new employees. The bad news came three months after the fund’s board approved. It approved a bulging number for those returns, Mistakes blamed for data errors..
The higher contribution rate of the 94,000 public school staff hired since 2011 will be approved by the Board in April and will come into effect in July.
Possibility if higher rates do not take effect as planned Outlined by State Senator Pat Brown (R., Lehi) in April, Taxpayers will be hooks — or I should tell hooks more. This is because the $ 40 billion gap between what PSERS actually has and what it actually needs to meet its retirement promise is also funded by John Q. Public. ..
If you want to know more about how the system moved from well-funded in 2000 to a very shortage in 2021 Read this.. In short, state legislators have approved higher pension benefits without more funding to support the system. As a result, funds have begun to pursue higher and riskier investments through expensive consultants who promise better odds.
Why is the FBI involved?
The FBI’s investigation was revealed shortly after the erroneous calculation above, but it’s unclear if the two are directly related. What is clear, thanks to reports by Spotlight PA and The Inquirer, is that federal agents are especially looking for money. Evidence of rebates or bribes from fund investments..
They are also investigating PSERS real estate purchases near Harrisburg headquarters and a December vote in which the board approved those bloated earnings.
The focus of the former comes after the official disclosure form to the IRS says that PSERS’top investment staff are also paid by the company hired to manage Harrisburg’s real estate. PSERS disclosed when Spotlight PA and The Inquirer began asking about the deal Insufficient wording and alternatives submitted to the IRS..
Is that all?
It’s not a long shot. Earlier this month, a board member led by State Treasurer Stacy Garrity. Push to expel the two top leaders of the fundQuotes an ongoing legal scandal and avalanche of mismanagement. Board member and state senator Katie Muse (D., Montgomery) filed a proceeding in another bid to obtain financial documents she said government officials refused to publish. ..
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Money, Power, Scandals: PSERS Story, Description | Nation & World
Source link Money, Power, Scandals: PSERS Story, Description | Nation & World