House Republican Newsletter

State Government Committee Touts Strength of IPERS

     Donna Muller, the CEO of IPERS, and Karl Koch, the CIO of IPERS, presented to the State Government Committee on Tuesday, Jan. 16. There are over 355,600 members of IPERS. Regular members make up 95 percent of IPERS. Special Service members make up the remaining 5 percent.

     The ratio of actuarial assets dropped from 83.9 percent to 81.4 percent. The unfunded actuarial liability increased by $1.4 billion, largely based upon the change in actuarial assumptions that were reduced from 7.5 percent to 7.0 percent. This decision has received praise from both financial professionals and government officials. However, this past fiscal year the fund earned 11.70 percent, which far exceeded the original investment return assumption. The ten-year rate of return ranks in the top 20^th percentile.

     Over the next five years, IPERS would like to add a number of internal investment managers. They believe that this will save the organization millions of dollars and allow them to have a better insight into what the external mangers are doing. However, this will take a significant start-up cost because IPERS does not currently have the trading, accounting, and control infrastructure. This would allow the Investment Board more authority and autonomy to hire and fire investment managers, set compensation levels, and oversee procurement investment tools.

     The current investment assets are worth $32.7 billion dollars. The investment assets have increased by nearly $2.5 billion dollars over the past year and half. Representative Ken Rizer, the chairman of the State Government Committee, stated at the end of the meeting that the committee does not have any interest in making any major reform to IPERS this year. I am a member of the State Government Committee. I sat in on the presentation and agree currently there isn’t any reason for changes in this program.

Future Ready Iowa

     With Iowa’s unemployment rate at a 17-year low, most Iowans that want a job have found one. However, what we have heard is that while unemployment is low, many Iowans lack the training or experience needed for high-paying careers that employers are trying to fill.

     We will be looking for opportunities this session to connect our K-12 schools with community colleges and local businesses to create a workforce pipeline across the entire state.

     Governor Reynolds has said that building a skilled and prepared workforce is her top priority this session and has proposed the Future Ready Iowa Act. She has set a goal for 70 percent of Iowa’s workforce to earn some sort of postsecondary degree or certification by 2025.

     The Future Ready Iowa Act will help reach this goal and the House Majority will be working closely with Governor Reynolds to ensure that future generations of Iowans are prepared for the careers and emerging industries of tomorrow.

     You can contact Rep. Hein at lee.hein@legis.iowa.gov.