Texas ERS Trust Fund exceeds $40 billion for first time

AUSTIN – The investments of the Employees Retirement System of Texas Trust Fund surpassed the $40 billion threshold last week for the first time thanks to sound strategy and strong support from the Texas Legislature.

The investment performance of the ERS Fund over the last five years has ranked among the top 1% of peer public pension funds in the country. As of Aug. 31, the ERS Fund has realized an annualized net of fees return of 9.63% over the last five years and a return of 12.51% over the last fiscal year.

“We are excited the assets of the ERS Fund crossed the $40 billion mark,” said ERS Chief Investment Officer David T. Veal. “Thanks to the diligent efforts of the ERS Board of Trustees, the Investment Advisory Committee, and staff, our diversified portfolio maintained strong and consistent growth over the last decade. We are also grateful beneficiaries of a commitment by Texas legislators to ensure that the state’s pension plans are restored or on a path to full funding.”

In 2021, the Texas Legislature passed Senate Bill 321 to address a shortfall in funding in the ERS pension plan by making additional annual payments through 2054 and by creating a new cash balance retirement structure for state employees hired after Aug. 31, 2022. To date, the Legislature has contributed $1.53 billion to the ERS plan as part of SB 321 and an additional $1.04 billion during the last legislative session to further address or eliminate liabilities related to the state’s three pension plans, including those within the Judicial Retirement System Plan 2 and Law Enforcement and Custodial Officer Supplemental Retirement Fund.

Solid investment performance of the ERS Fund helps it weather swings in markets and contributes to the overall fiscal well-being of the State of Texas, which supports the lifetime pensions for retired state employees.

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About ERS

The Employees Retirement System of Texas proudly serves the public servants who work for or have worked for the state of Texas. Since 1947, ERS has managed benefits for employees and retirees of Texas state agencies and some higher education institutions. These benefits contribute to the financial security and overall well-being of employees, retirees, and their families.