PLANSPONSOR - April/May 2019 - 44

Illinois Municipal Retirement Fund
Public Defined Benefit
Plan at a Glance
TOTAL PLAN ASSETS/PARTICIPANTS: $41.4 billion/419,799
FUNDING STATUS: 98.2% at year-end 2017
EMPLOYERS IN THE PLAN: 2,997
" has always enjoyed a relatively high funding level of between
90% and 100%, with two-thirds of our pension payments coming
out of the investment returns as opposed to larger employer
contributions. " Further, over the past 36 years, IMRF has earned
an average of 10% on its investment portfolio, Collins says.
By keeping the plan consistently funded at such a high
level, " the more money the chief investment officer [CIO] has to
invest, and the more money on hand to invest, the more money
you will make over time, " says Dan Duquette, deputy executive
director of IMRF.
" Some plans have had to sell investments in order to pay
benefits. That's a rare event but a dangerous situation to be in.
We are fortunate in that we are nowhere close to that. "
Executive Director Brian Collins
T
he Illinois Municipal Retirement Fund (IMRF), with offices in
Oak Brook, Illinois, is a public defined benefit (DB) pension
system providing retirement, disability and survivor benefits to
the employees of units of local government and school districts
throughout Illinois. As of December 31, 2017, IMRF served 2,997
employers, and 419,799 active, inactive or retired members.
Members are classified by " plan " and " tier " depending on
their position and participation dates. Members in the Regular
Plan contribute 4.5% of their IMRF reportable earnings. Tier 1
Regular Plan members are vested after obtaining eight years of
service credit, and Tier 2 Regular Plan members are vested after
obtaining 10 years.
IMRF was 98.2% funded on a market basis at the close of
its fiscal year ending December 31, 2017. That does not surprise
Brian Collins, executive director of the pension fund, as IMRF
44 PLANSPONSOR.com April - May 2019
Photo by James Rajotte
Conservative, Disciplined Investing
Illinois Municipal Retirement Fund is able to achieve such a
high funding status through a " very disciplined approach to
investing, " Collins says. " Our asset allocation doesn't change
dramatically over time. We don't react to near-term changes
in the marketplace. We take a conservative and committed
approach. We also have really high-quality people running the
plan. We are proud of our CIO, Dhvani Shah, and her team, as
well as past CIOs and teams that preceded her. Those are the
ingredients for long-term success. "
In fact, the pension plan has paid 60%, on average, of its
benefits directly from its returns, Collins notes. " This is probably
on the high side for most pensions. It fluctuates from year to year.
Last year, we paid 64% of benefits from the returns. " Certainly,
paying nearly two-thirds of pension payments from the plan's
investment returns as opposed to larger employer contributions
is one of the strengths of the plan, Collins says.
Four trustees of the eight-member board are elected by the
nearly 3,000 employers, Collins says. Three trustees are elected
by the 177,000 working active members of the pension plan
and one by its 125,000 retirees. " This gives the board a very
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