Subject: Pension Fund Update 4/4/2020
I have received several calls, texts and emails recently asking about the stability and health of our Pension Fund. Would you please share the following with all of those who receive a pension from our Fund:
The San Antonio Fire & Police Pension Fund continues to be one of the strongest pension systems in our Country and the State of Texas. As of approximately 4 weeks ago the value of our Fund was $3.3 Billion dollars, the highest it has ever been. We had a great year in 2019, with a 14.9% investment return. As you know, the last 4 weeks have been terrible for investments, and we are down -9.4%. The value of our Fund as of yesterday ,4/3/20 ,was $ 3.05 Billion. I believe the Fund value will be further reduced by 2-3% when we receive values from our less liquid investments like real estate and private equity, which report their values only quarterly. Even with all the negative impact of the Corona-Virus of the past month, we are strong and pensions will be paid monthly, as always.
As you noticed, we were up just under 15% in 2019 when the S&P500 was up nearly 30%. Conversely, we are down just -9.4% for the first 3 months of 2020, when the S&P500 is down -22.3%. Our Fund is well diversified: 46% Stocks, 32% Bonds, 9% Real Estate, 9% Hedge Funds, 3% Real Assets ( Timber, Oil & Gas, Infrastructure ) and 1% Cash. This diversification allows for us to take less risk than the stock market and reach a long term investment goal of 7.25% .
Finally, the pension contributions made, by all of us, while we were working for the Police or Fire Departments have been a huge contributor to the success of our Fund. Today, active members contribute $39 Million annually to our Pension Fund. There are 4062 active firefighters and police officers, and the City double-matches their contributions. The City contributes $78 Million annually to our Fund. This total annual contribution of $117 Million, along with our investment return, is funding the future liabilities of the Fund. Additionally, theses contributions ensure the health of our Fund for the 2847 of us who are currently receiving pensions.
Please rest assured that our Pension Fund is strong and that regular monthly pensions will be paid for our lifetimes. This current world-wide health crisis will end, economies will rebound and positive investment returns will return ensuring the long term stability of our retirement fund.
Harry Griffin, Board Member
Fire & Police Pension Fund, San Antonio