MINUTES OF MEETING
STATE EMPLOYEES RETIREMENT COMMISSION
ACTUARIAL SUBCOMMITTEE

September 17, 2008

MEMBERS PRESENT
Peter R. Blum, Chairman
Robert Baus
Charles Casella
Richard Cosgrove
Claude Poulin
Steve Greatorex
Linda Yelmini

OTHERS PRESENT
Dr. Thomas Woodruff, Director, Retirement Services Division
Jeanne Kopek, Assistant Director, Retirement Services Division
Althea Schwartz, Milliman
Rebecca Sielman, Milliman

The meeting began at about 2:00.

Becky Sielman presented several exhibits showing the impact of changes to the assumptions used in the State Employees Retirement System (SERS) actuarial valuation process as discussed at the July and August meetings.

The trustees expressed concern with the present funding ratio. The Milliman actuaries advised that the decline in the funding was a result of the past ERIPs and the market losses that occurred early in this decade. Under the current level percent funding method which is mandated by the SEBAC agreement and reflects a long term approach, the funding ratio will go up very slowly. They suggested that the economic assumptions only be revisited in two years; two years would not provide enough data to revisit the demographic assumptions.

Mr. Baus moved, seconded by Ms. Yelmini that the assumptions be changed as illustrated in Exhibit 2 which used the proposed demographic and economic assumptions with an 8.25% investment return.

Mr. Poulin added that the economic assumptions should be revisited in two years and a footnote should be included in the valuation about the possibility of retroactive application in the Longley matter.

The subcommittee voted unanimously to approve the motion and to make the same changes to the mortality and interest assumptions used in the valuation process for the Judges, Family Support Magistrates and Compensation Commissioners Retirement System (JFSMCCRS).

The next meeting of the subcommittee to review the draft valuations for SERS and JFSMCCRS was scheduled for 2:00 P.M. on Wednesday, October 15, 2008.

Meeting adjourned at about 4:00.

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