State Treasurer Janet Cowell said this morning that the state's pension fund is down $16 billion from a year ago.
The fund, which pays retirement benefits for tens of thousands of state and local government employees, is valued at $60 billion, Ben Niolet reports.
A year ago, the fund was worth $77 billion. The drop represents a 19.7 percent decline in fund performance, a measure created by the fund's actuary.
Cowell said the fund is down because of the dramatic downturn in global markets. The state's treasurers have traditionally been conservative in how they invest the money, which is why the state's pension fund is faring better than other similar funds, she said.
As the markets have turned worse, the Treasurer's office has turned even more conservative, increasing its allocation in less risky, long-term investments.
"North Carolina is in better shape than almost any state," she said.
Former Treasurer Richard Moore like to tout the fact that the fund had more than enough money to pay its beneficiaries. That's still true, but the number is sliding, Cowell said. The plan is funded at 104.7 percent. Next year that number will slide to about 100 percent.
Cowell said all retirees will get their benefits.
"You're entitled to your money," Cowell said.
The loss in value likely means that the legislature will have to increase its contribution to employees retirement benefits by about $29 million for the next year. That means the tab for the legislature will be somewhere around $430 million. The legislature's burden will likely increase in 2010.
Employees contribute 6 percent of their checks to the fund. Erica Baldwin, a spokeswoman for the State Employees Association, which represents some 55,000 employees or retirees, said the organization has repeatedly urged the legislature to up their contribution to state employees retirement.
"That's been the weakest leg of the stool," Baldwin said.
Update: Post now includes more details.
Correction: Post now includes correct value of the fund a year ago. It also includes a better description of the change in performance.