Pennsylvania pension system investigating calculation error

The board of Pennsylvania’s largest public pension system, the Public School Employees’ Retirement System, said it is investigating a consultant’s calculation about the fund’s investment performance last year that is apparently wrong.

The calculation — 6.38% growth over the nine years ending last June 30 — was slightly above a 6.36% growth threshold, thus protecting retirement system members from seeing a higher risk-sharing contribution rate kick in next July 1.

On March 12, the PSERS board issued a brief statement saying it had been made aware of an error in the calculation and that an outside consultant was studying the data.

It also hired two law firms, including one to provide guidance on whether and how to recertify the member shared risk contribution rate.

On Friday, it said it was “investigating the circumstances regarding the consultant’s calculation as well as the actions taken by PSERS’ staff and the consultant after the consultant’s disclosure.”

It said it had made no personnel changes, and pledged to cooperate with “any governmental inquiries,” but officials aren’t commenting beyond that brief statement.

PSERS on Dec. 31 reported net assets of $64.2 billion and a membership of about 256,000 active, 240,000 retired school employees and 26,000 vested inactive members. It is one of the nation’s largest pension systems.