New Mexico Educational Retirement Board

The meeting included the approval of the amended agenda and the minutes from the August 20, 2021 meeting. Key discussions involved the swearing-in of the new Secretary of Education. Committee appointments were finalized for the Alternative Retirement Plan, Audit, Evaluation, and Investment Committees. The board adopted a resolution supporting an increase in employer contributions to address solvency issues. An update was provided on state securities litigation practices by the Attorney General's Office, detailing the process for managing fraud-related investment losses. Investment reports covered new commitments to the Stonepeak Asia Infrastructure Fund and TPG Thematic Advantage Core-Plus Real Estate, as well as the continuation of the PanAgora contract. The implementation of a Cash Overlay strategy was presented as a means to enhance long-term returns and manage interest rate exposure. The board also reviewed disability and age & service retirement statistics, noting a restriction on pension payments exceeding $230,000 due to IRS rules, which is managed through a qualified excess benefit arrangement. Updates on the agency building project detailed progress on design phases and increased cost estimates due to construction material inflation. The Director's report highlighted the hiring of a new Chief Information Officer, a modified in-office work setting, and positive projections for the Unfunded Actuarial Accrued Liability from the annual actuarial report. The board convened an executive session to discuss administrative appeal deliberations, pending litigation updates (NMERB v. Debbie Romero and Jan Goodwin v. Governor Lujan Grisham et al.), and personnel matters concerning the Executive Director search and pay, subsequently ratifying the Hearing Officer's Recommended Decision to uphold the denial of service credit adjustment for Dr. Kendall Crookston.

The meeting agenda was approved, followed by key discussions and reports. Topics included the approval for Board members to attend the NEPC conference and the Pension Bridge Annual Conference. The Board approved the Open Meetings Act Resolution for 2023. The Audit Committee reported on the 2022 Fiscal Year Annual Financial Audit, noting no material weaknesses or significant deficiencies, and presented on the FY23 Audit Plan and IT Helpdesk Audit results. The Alternative Retirement Plan (ARP) Committee reported on the reimbursement of revenue credit accounts ($35,000 to TIAA participants and $10,000 to Fidelity participants) and approved changes to the investment watchlist, including replacing Fidelity High Income with MainStay MacKay High Yield Corporate Bond R6. The Actuarial Valuation Report for June 30, 2022, was accepted. Investment reports covered an Asset-Liability Study recommending the adoption of a new asset allocation (Mix C), and the subsequent approval of Investment Policy Statement revisions aligning with Mix C. Quarterly performance showed a net investment loss for the period ending September 30, 2022, but outperformed the policy index. A $100 million commitment to PIMCO Corporate Opportunities Fund IV was approved. Retirement applications for disability and age & service were approved. The Director reported on addressing violations related to Return to Work policies, updates on legislative endorsements, and considerations for the sale of the existing office complex. The Board also discussed the Board Self-Assessment Results and Strategic Plan review. The meeting concluded with an Executive Session to discuss threatened or pending litigation.

The meeting agenda was approved, and the minutes from the December 6, 2019 session were approved. Discussions included consent items regarding board travel, specifically permission for future conference attendance. A significant portion of the meeting involved the presentation of the June 30, 2019 Audit Report, which resulted in unmodified clean opinions with no material weaknesses noted. Investment reports detailed quarterly performance, showing the Fund achieved a net investment gain of $1.7 billion for the year ending December 31, 2019, with assets reaching a new high of $13.8 billion. The board approved disability retirements and 282 age and service retirements for the December-January period. The Director's report covered updates on retiree healthcare subsidy changes, agency activities, and legislative matters, notably that the ERB funding bill (HB 46) was tabled, and concerns regarding the Senate Bill 111, which impacts revenue generation. The board entered an executive session to discuss limited personnel matters, specifically compensation for the Chief Investment Officer and executive staff.

The meeting agenda included procedural items, the swearing in of a new board member, and the election of board officers. Key discussion items encompassed the consideration of investment strategies regarding divestment and engagement, a review of the Statement of Beliefs and Guiding Principles related to sustainability and plan design, and presentation of various investment reports, including the Investment Policy Statement revision and the June 2018 Quarterly Performance Report. Additionally, the agenda addressed the FY20 Budget Appropriation Request, disability retirements, and age & service retirements. The Director's Report covered updates on retirement season, audit findings, and retiree healthcare. The agenda concluded with scheduled executive sessions for deliberation on hearing officer recommended decisions in administrative appeals, action following executive session, and a review of the process and timelines for the Executive Director Evaluation.

The Alternative Retirement Plan (ARP) Committee meeting involved several key discussions and actions. The committee reviewed due diligence reports for the Cammack Retirement Group as of December 31, 2018, noting that the ERB ARP plan held approximately $651.7 million in total assets, with specific details on asset allocation for the TIAA and Fidelity programs, including funds placed on watch due to manager changes. A significant item was the discussion and subsequent approval to adopt a fee levelization program, which is considered a best practice for assessing administrative fees. The committee also discussed and approved moving prospective funds to the Retirement Choice contract structure with TIAA to better mitigate fiduciary risk and potentially improve returns compared to legacy contracts. Furthermore, an update was provided on the 2019 diversification campaign strategy with TIAA. Finally, the committee approved the renewal of the professional services contract with Cammack Retirement Group for an additional year.