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SERS Board Resolutions - 2022

MOTION: 2022-52 MOTION TO ADJOURN

Meeting Date: December 12, 2022

MOTION: 2022-51 EXECUTIVE DIRECTOR PAY

Meeting Date: December 12, 2022

RESOLVED: That the State Employees’ Retirement Board accepts the recommendation of the Board Governance and Personnel Committee to grant the Executive Director, SERS, a cost-of-living increase of the same percentage and with the same effective date as the annual cost-of-living adjustment approved by the Governor pursuant to the Act of October 19, 1995, P.L. 324, No. 51.

MOTION: 2022-50 SPECIAL ASSISTANT PERFORMANCE AND PAY PROCESS

Meeting Date: December 12, 2022

RESOLVED: That the State Employees’ Retirement Board accepts the recommendation of the Board Governance and Personnel Committee to adopt the Special Assistant Performance Review and Pay Process, the provisions of which apply as long as the Special Assistant to the Executive Director, SERS, job remains assigned to pay scale type XH, and to authorize pay increases, subject to Commonwealth Executive Board approval, for the Special Assistant to the Executive Director, SERS, job in accordance with the procedures, as located in BoardDocs at Agenda Item 7.a. (ATTACHMENT A).

MOTION: 2022-49 COMPENSATION POLICY FOR INVESTMENT PROFESSIONALS: AGGREGATE PAY INCREASE BUDGET

Meeting Date: December 12, 2022

RESOLVED: That the State Employees’ Retirement Board accepts the recommendation of the Board Governance and Personnel Committee to approve the annual aggregate pay increase budget for 2023 to be set at 7.4% of the aggregate salary of all staff compensated on the investment professional pay schedule for positions below that of the Chief Financial Officer and the Chief Investment Officer, with the actual pay increases for all staff compensated on the investment professional pay schedule including the Chief Financial Officer and the Chief Investment Officer to be determined in accordance with the Compensation Policy for Investment Professional Staff – State Employees’ Retirement System.

MOTION: 2022-48 PRIVATE EQUITY – Hellman & Friedman Capital Partners XI, L.P.

Meeting Date: December 12, 2022

RESOLVED: That the State Employees’ Retirement Board accepts the recommendation of the Investment Committee to commit up to $100 million to Hellman & Friedman Capital Partners XI, L.P., plus investment expenses and pro rata share of partnership operating expenses, consistent with executed partnership documents, as a follow-on investment within the Private Equity asset class, subject to successful completion of contract negotiations and execution and delivery of closing documents by all parties, including required Commonwealth legal approvals, within 12 months.

MOTION: 2022-47 APPROVAL OF CONSENT CALENDAR

Meeting Date: December 12, 2022

A. Approving Board Meeting Minutes – September 29, 2022

B. Approving Defined Benefit Plan Statement of Changes in Fiduciary Net Position for the Periods Ending – July 31, August 31, and September 30, 2022

C. Approving Deferred Compensation Plan (DCP) Statement of Changes in Net Position Available for Benefits for the Periods Ending – July 31, August 31, and September 30, 2022

D. Approving Defined Contribution Plan Statement of Changes in Fiduciary Net Position for the Periods Ending – July 31, August 31, and September 30, 2022

RESOLVED: That the board approves the Consent Calendar items, as listed, for the December 12, 2022, board meeting.

MOTION: 2022-46 ADOPTION OF THE AGENDA

Meeting Date: December 12, 2022

RESOLVED: That the board adopts the agenda for the December 12, 2022, board meeting.

MOTION:  2022-45  MOTION TO ADJOURN
Meeting Date: September 29, 2022

MOTION:  2022-44 BUDGET FOR FY 2023-24
Meeting Date: September 29, 2022

RESOLVED:  That the State Employees’ Retirement Board accepts the recommendation of the Finance and Member & Participant Services Committee to approve the following proposed budgets, each substantially in the same form as presented in the Chief Financial Officer’s SERS FY 2023-2024 Budget Report in BoardDocs and each as amended and/or ultimately approved by the Office of the Budget: 

  1.  SERS Administrative Budget;

  2.  SERS Investment Budget;

  3.  State Employees’ Defined Contribution Plan Budget; and

  4.  Commonwealth’s State Employees Deferred Compensation Plan Budget.

MOTION:  2022-43 2022 STRESS TESTING AND RISK ASSESSMENT REPORT
Meeting Date: September 29, 2022

RESOLVED:  That the State Employees’ Retirement Board accepts the recommendation of the Finance and Member & Participant Services Committee to approve the 2022 Stress Testing and Risk Assessment Report prepared by SERS’ actuary, Korn Ferry. 

MOTION:  2022-42 REAL ESTATE  – Oak Street Real Estate Capital Fund VI, LP
Meeting Date: September 29, 2022

RESOLVED:  That the State Employees’ Retirement Board accepts the recommendation of the Investment Committee to commit up to $75 million to Oak Street Real Estate Capital Fund VI, LP, plus investment expenses and pro rata share of partnership operating expenses, consistent with executed partnership documents, as an investment within the Real Estate asset class, subject to successful completion of contract negotiations and execution and delivery of closing documents by all parties, including required Commonwealth legal approvals, within 12 months.

MOTION:  2022-41 PRIVATE EQUITY – Ardian Secondaries Fund IX, L.P. and Ardian Sidecar Co-Investment Vehicle
Meeting Date: September 29, 2022

RESOLVED:  That the State Employees’ Retirement Board accepts the recommendation of the Investment Committee to commit (i) up to $100 million to ASF IX L.P., and (ii) up to $50 million to a sidecar vehicle that will co-invest alongside ASF IX, plus investment expenses and pro rata share of partnership operating expenses, consistent with executed partnership documents, as follow-on investments within the Private Equity asset class, subject to successful completion of contract negotiations and execution and delivery of closing documents by all parties, including required Commonwealth legal approvals, within 12 months.

MOTION:  2022-40 APPROVAL OF CONSENT CALENDAR
Meeting Date: September 29, 2022

RESOLVED:  That the board approves the Consent Calendar items, as listed, for the September 29, 2022, board meeting.

MOTION:  2022-39 ADOPTION OF THE AGENDA
Meeting Date: September 29, 2022

RESOLVED:  That the board adopts the agenda for the September 29, 2022, board meeting.    
APPROVAL OF CONSENT CALENDAR
A.  Approving Board Meeting Minutes – July 25, 2022
B.  Approving Defined Benefit Plan Statement of Changes in Fiduciary Net Position for the Periods Ending – April 30, May 31 and June 30, 2022
C.  Approving Deferred Compensation Plan (DCP) Statement of Changes Reports Ending –
April 30, May 31 and June 30, 2022
D.  Approving Defined Contribution Plan Statement of Changes in Fiduciary Net Position for the Periods Ending – April 30, May 31 and June 30, 2022

MOTION: 2022-38 MOTION TO ADJOURN

Meeting Date: July 25, 2022

MOTION: 2022-37 PRIVATE EQUITY – SENTINEL CAPITAL PARTNERS VII, L.P.

Meeting Date: July 25, 2022

RESOLVED: That the State Employees’ Retirement Board accepts the recommendation of the Investment Committee to (i) commit up to $100 million to Sentinel Capital Partners VII, L.P., and (ii) commit up to $25 million to Sentinel Junior Capital II, L.P., plus investment expenses and pro rata share of partnership operating expenses, consistent with executed partnership documents, as investments within the Private Equity asset class, subject to successful completion of contract negotiations and execution and delivery of closing documents by all parties, including required Commonwealth legal approvals, within 12 months.

MOTION: 2022-36 BOARD CONSULTANT EVALUATION PROCEDURES

Meeting Date: July 25, 2022

RESOLVED: That the board accepts the recommendation of the Board Governance and Personnel Committee to approve the State Employees’ Retirement Board Consultant Evaluation Procedures, as set forth in the attachment (ATTACHMENT A).

MOTION: 2022-35 APPROVAL OF CONSENT CALENDAR

Meeting Date: July 25, 2022

RESOLVED: That the board approves the Consent Calendar items, as listed, for the July 25, 2022, board meeting.

A. Approving Board Meeting Minutes – June 10, 2022

B. Approving State of Changes in Fiduciary Net Position for the Period Ending – March 31, 2022

C. Approving Deferred Compensation Plan (DCP) Statement of Changes Report Ending –

March 31, 2022

D. Approving Defined Contribution Plan Statement of Changes Report Ending – March 31, 2022

MOTION: 2022-34 ADOPTION OF THE AGENDA

Meeting Date: July 25, 2022

RESOLVED: That the board adopts the agenda for the July 25, 2022, board meeting.

MOTION: 2022-33 MOTION TO ADJOURN
Meeting Date: June 10, 2022

MOTION: 2022-32 INVESTMENT RATE OF RETURN ACTUARIAL ASSUMPTION
Meeting Date: June 10, 2022

RESOLVED:  That the board accepts the recommendation of the Finance and Member and Participant Services Committee to (i) lower the current annual assumed rate of investment return to 6.875%, compounded annually, and (ii) keep unchanged the annual assumed rate of inflation of 2.5%, compounded annually, with both assumptions to be effective with the December 31, 2022, Actuarial Valuation and remain in effect until further action by the board.

MOTION: 2022-31 RESULTS OF 2021 INDEPENDENT AUDIT
Meeting Date: June 10, 2022

RESOLVED: That the board accepts the recommendation of the Audit, Risk, and Compliance Committee to approve the audited 2021 Financial Statements with Required Supplementary Information With Independent Auditors’ Report for Fiscal Years Ended December 31, 2021 and 2020 of the Commonwealth of Pennsylvania State Employees’ Retirement System for the Defined Benefit Plan and State Employees’ Defined Contribution Plan, and the audited 2021 Financial Statements with Required Supplementary Information With Independent Auditors’ Report for Fiscal Years Ended December 31, 2021 and 2020 of the Commonwealth of Pennsylvania Deferred Compensation Plan, as presented by our independent auditors, KPMG LLP.

MOTION: 2022-30 REAL ESTATE – BLACKSTONE REAL ESTATE PARTNERS X, L.P.
Meeting Date: June 10, 2022

RESOLVED: That the board accepts the recommendation of the Investment Committee to commit up to $75 million to Blackstone Real Estate Partners X, L.P., plus investment expenses and pro rata share of partnership operating expenses, consistent with executed partnership documents, as an investment within the Real Estate asset class, subject to successful completion of contract negotiations and execution and delivery of closing documents by all parties, including required Commonwealth legal approvals, within 12 months. 

MOTION: 2022-29 PRIVATE EQUITY – VERITAS CAPITAL FUND VIII, L.P. AND SIDECAR
Meeting Date: June 10, 2022

RESOLVED: That the board accepts the recommendation of the Investment Committee to commit (i) up to $100 million to The Veritas Capital Fund VIII, L.P., and (ii) up to $25 million to a sidecar vehicle that will co-invest alongside The Veritas Capital Fund VIII, plus investment expenses and pro rata share of partnership operating expenses, consistent with executed partnership documents, as investments within the Private Equity asset class, subject to successful completion of contract negotiations and execution and delivery of closing documents by all parties, including required Commonwealth legal approvals, within 12 months.

MOTION: 2022-28 PRIVATE EQUITY – SENTINEL CAPITAL PARTNERS VII, L.P.
Meeting Date: June 10, 2022

RESOLVED: That the board postpone indefinitely the recommendation of the Investment Committee to (i) commit up to $100 million to Sentinel Capital Partners VII, L.P., and (ii) commit up to $25 million to Sentinel Junior Capital II, L.P. 

MOTION: 2022-27 SERS STRATEGIC PLAN FY 2021-FY 2023
Meeting Date: June 10, 2022

RESOLVED: That the board accepts the recommendation of the Board Governance and Personnel Committee to approve the SERS Strategic Plan FY 2021 – FY 2023, as set forth in the attachment (ATTACHMENT A). 

MOTION: 2022-26 SUCCESSION PLAN FOR KEY SERS LEADER POSITIONS
Meeting Date: June 10, 2022

RESOLVED: That the board accepts the recommendation of the Board Governance and Personnel Committee to approve the delegation of authority to the Executive Director of SERS the responsibility of developing and implementing a SERS Succession Plan for the Key SERS Leader positions of Executive Director, Chief Investment Officer, Chief Counsel, Internal Audit Director, Chief Compliance Officer, and Chief Financial Officer, which will have the following key components, with the overarching objective of ensuring that the ongoing daily operations at SERS continues:
1. Provide clear emergency contingency plans and directions in the event of an unexpected or planned temporary absence of a Key SERS Leader;
2. Develop and proactively plan for a future vacancy and planned departures; and
3. Include a general recruitment strategy, which is consistent with the agency’s commitment to an inclusive and respectful work environment that fosters personal and professional growth, embraces the contributions of all team members, and values diversity in people, ideas, and experiences to achieve our highest potential. 

MOTION: 2022-25 APPROVAL OF CONSENT CALENDAR
Meeting Date: June 10, 2022

RESOLVED: That the board approves the Consent Calendar items, as listed, for the June 10, 2022, board meeting.
A.  Approving Board Meeting Minutes – May 5, 2022
B.  Approving State of Changes in Fiduciary Net Position for the Periods Ending – December 31, 2021, January 31 and February 28, 2022
C.  Approving Deferred Compensation Plan (DCP) Statement of Changes Reports Ending –
December 31, 2021, January 31 and February 28, 2022
D.  Approving Defined Contribution Plan Statement of Changes Reports Ending – December 31, 2021, January 31 and February 28, 2022

MOTION: 2022-24 ADOPTION OF THE AGENDA
Meeting Date: June 10, 2022

RESOLVED: That the board adopts the agenda for the June 10, 2022, board meeting.    

MOTION: 2022-23 MOTION TO ADJOURN
Meeting Date: May 5, 2022

MOTION: 2022-22 DEFINED BENEFIT PLAN’S INVESTMENT MANAGER MONITORING POLICY
Meeting Date: May 5, 2022

RESOLVED: That the board accepts the recommendation of the Investment Committee to approve the updates to the Defined Benefit Plan’s Investment Manager Monitoring Policy, which updates are provided in the attached meeting material entitled “5d SERS DB Investment Manager Monitoring Policy 4.28.2022.pdf” (ATTACHMENT D).

MOTION: 2022-21 DEFERRED COMPENSATION PLAN INVESTMENT POLICY STATEMENT
Meeting Date: May 5, 2022

RESOLVED: That the board accepts the recommendation of the Investment Committee to approve the following updates to the 457(b) Deferred Compensation Plan Investment Policy Statement:
a. Reassignment of responsibilities from the Defined Contribution Committee to the Investment Committee.
b. Enhancements to the Investment Manager Monitoring Policy to create consistency across all Plans.

The revised document is in the attached meeting material entitled “5d SERS Deferred Compensation Plan Investment Policy Statement – Attachment B” (ATTACHMENT C).

MOTION: 2022-20 DEFINED CONTRIBUTION PLAN INVESTMENT POLICY STATEMENT
Meeting Date: May 5, 2022

RESOLVED:That the board accepts the recommendation of the Investment Committee to approve the following updates to the 401(a) Defined Contribution Plan Investment Policy Statement:

a. Reassignment of responsibilities from the Defined Contribution Committee to the Investment Committee.
b. Enhancements to the Investment Manager Monitoring Policy to create consistency across all Plans.

The revised document is in the attached meeting material entitled “5d SERS Defined Contribution Plan Investment Policy Statement – Attachment A” (ATTACHMENT B).

MOTION:  2022-19 ASSET ALLOCATION AND INVESTMENT POLICY STATEMENT
Meeting Date: May 5, 2022

RESOLVED:  That the board accepts the recommendation of the Investment Committee to
(i)  adopt the Enhanced Asset Allocation Policy and approve the corresponding updates to the SERS Defined Benefit Plan’s Investment Policy Statement, which are in the attached meeting material entitled “DB Plan IPS Update 4.28.2022.pdf” (ATTACHMENT A); and
(ii) delegate authority to the Chief Investment Officer to:
1)   reallocate fixed income portfolios to comply with the Enhanced Asset Allocation Policy;
2)   adjust fixed income portfolio objectives to comply with the Enhanced Asset Allocation Policy;
3)   liquidate fixed income portfolios that do not fit into the Enhanced Asset Allocation Policy; and
4)   adjust the implementation’s time frame as required by the market conditions and/or demands of the structure implementation.

The Chief Investment Officer shall receive concurrence from the board’s general investment consultant prior to executing any action delegated by this motion.  Notification of all implementation actions shall be provided at the next regularly scheduled Investment Committee or board meeting, respectively.

MOTION:  2022-18 PRIVATE EQUITY CONSULTANT
Meeting Date: May 5, 2022

RESOLVED:  That the board accepts the recommendation of the Investment Committee to hire StepStone Group LP to act as SERS’ non-discretionary private equity consultant and provide administrative and back-office support for SERS’ Defined Benefit Plan investment portfolio, subject to successful completion of contract negotiations and execution and delivery of closing documents by all parties, including required Commonwealth legal approvals, within six months. 

MOTION:  2022-17 2021 ACTUARIAL VALUATION RESULTS
Meeting Date: May 5, 2022

RESOLVED:  That the board accepts the recommendation of the Finance and Member and Participant Services Committee to:

(A)  approve the results of the December 31, 2021, actuarial valuation; and for the Commonwealth’s fiscal year 2022-23, certify the following contribution rates:
1.     Shared-risk contribution rate of 0.0%;
2.     Employer normal cost contribution rate of 8.32%;
3.     Composite employer contribution rate necessary for the funding of the system of 34.10%; and
4.     Employer contribution rates by group and class of service of employees as set forth in the actuarial valuation as calculated by SERS’ consulting actuary, Korn Ferry, pursuant to Section 5508 of the State Employees’ Retirement Code;
(B)   authorize SERS staff and Korn Ferry to use the above rates to develop all the employer rates for the period of July 1, 2022, to June 30, 2023, pursuant to Section 5902(k) of the State Employees’ Retirement Code;
(C)   establish an employer contribution rate of 0.06% for fiscal year 2022-23 to fund the Benefits Completion Plan established pursuant to Section 5941 of the State Employees’ Retirement Code; and
(D)   authorize the Executive Director to certify such rates to all employers with employees who are active members of SERS and to the Secretary of the Budget.

MOTION:  2022-16 APPROVAL OF CONSENT CALENDAR
Meeting Date: May 5, 2022

RESOLVED:  That the board approves the Consent Calendar items, as listed, for the May 5, 2022, board meeting.

MOTION:  2022-15 ADOPTION OF THE AGENDA
Meeting Date: May 5, 2022

RESOLVED:  That the board adopts the agenda for the May 5, 2022, board meeting.    

MOTION: 2022-14 MOTION TO ADJOURN
Meeting Date: March 4, 2022

MOTION:  2022-13 DIVESTMENT OF RUSSIA-RELATED AND BELARUS-RELATED ASSETS
Meeting Date: March 4, 2022

RESOLVED:  That the board, in response to Russia’s invasion of Ukraine, the SERS administrative staff, investment office staff and the board’s investment consultants are to begin immediately to take all actions necessary to divest SERS of all Russia-related and Belarus-related assets and investments held by SERS in a fiduciarily prudent manner and within a reasonable time;
AND FURTHER, the administrative and investment office staff of SERS shall direct the investment managers, consultants, and other investment partners of SERS to cease making further Russia-related and Belarus-related investments until such time as the board, after receiving the advice of internal staff and outside investment consultants and advisors, concludes that it is fiduciarily prudent to again do so.

MOTION:  2022-12 2022 SECURITIES LITIGATION COMMITTEE WORK PLAN
Meeting Date: March 4, 2022

RESOLVED:  That the board accepts the recommendation of the Securities Litigation Committee to approve the 2022 Securities Litigation Committee Work Plan, as set forth in the attachment (ATTACHMENT H). 

MOTION:  2022-11 2022 AUDIT, RISK AND COMPLIANCE COMMITTEE WORK PLAN
Meeting Date: March 4, 2022

RESOLVED:  That the board accepts the recommendation of the Audit, Risk and Compliance Committee to approve the 2022 Audit, Risk and Compliance Committee Work Plan, as set forth in the attachment (ATTACHMENT G). 

MOTION:  2022-10 PRIVATE EQUITY OPPORTUNITY-THOMA BRAVO FUND XV, L.P. AND THOMA BRAVO DISCOVER FUND IV, L.P.
Meeting Date: March 4, 2022

RESOLVED:  That the board accepts the recommendation of the Investment Committee to commit (i) up to $100 million to Thoma Bravo Fund XV, L.P., (ii) up to $50 million to Thoma Bravo Discover Fund IV, L.P., and (iii) up to $50 million to a sidecar vehicle that will co-invest alongside Thoma Bravo XV and/or Thoma Bravo Discover Fund IV, plus investment expenses and pro rata share of partnership operating expenses, consistent with executed partnership documents, as a follow-on investment within the Private Equity asset class, subject to successful completion of contract negotiations and execution and delivery of closing documents by all parties, including required Commonwealth legal approvals, within 12 months.

MOTION:  2022-09 PRIVATE EQUITY OPPORTUNITY-FRANCISCO PARTNERS VII, L.P. AND FRANCISCO PARTNERS AGILITY III, L.P.
Meeting Date: March 4, 2022

RESOLVED:  That the board accepts the recommendation of the Investment Committee to commit (i) up to $100 million to Francisco Partners VII, L.P., (ii) up to $50 million to Francisco Partners Agility III, L.P., and (iii) up to $50 million to a sidecar vehicle that will co-invest alongside Francisco Partners VII and/or Francisco Partners Agility III, plus investment expenses and pro rata share of partnership operating expenses, consistent with executed partnership documents, as a follow-on investment within the Private Equity asset class, subject to successful completion of contract negotiations and execution and delivery of closing documents by all parties, including required Commonwealth legal approvals, within 12 months.

MOTION:  2022-08 2022 INVESTMENT COMMITTEE WORK PLAN
Meeting Date: March 4, 2022

RESOLVED:  That the board accepts the recommendation of the Investment Committee to approve the 2022 Investment Committee Work Plan, as set forth in the attachment (ATTACHMENT F). 

MOTION:  2022-07 2022 FINANCE AND MEMBER & PARTICIPANT SERVICES COMMITTEE WORK PLAN
Meeting Date: March 4, 2022

RESOLVED:  That the board accepts the recommendation of the Finance and Member and Participant Services Committee to approve the 2022 Finance and Member and Participant Services Committee Work Plan, as set forth in the attachment (ATTACHMENT E). 

MOTION:  2022-06 AMENDMENTS TO COMMITTEE CHARTERS
Meeting Date: March 4, 2022

RESOLVED:  That the board accepts the recommendations of the Audit, Risk and Compliance Committee and the Board Governance and Personnel Committee to approve the amendments to their respective charters, as set forth in the attachments (ATTACHMENTS C and D). 

MOTION:  2022-05 PAY ADJUSTMENT FOR THE CHIEF INVESTMENT OFFICER
Meeting Date: March 4, 2022

RESOLVED:  That the board accepts the recommendation of the Board Governance and Personnel Committee to approve a pay increase to $173.64 an hour for James Nolan, Chief Investment Officer SERS effective the first full pay period of March 2022. 

MOTION:  2022-04 2022 BOARD GOVERNANCE & PERSONNEL COMMITTEE WORK PLAN
Meeting Date: March 4, 2022

RESOLVED:  That the board accepts the recommendation of the Board Governance and Personnel Committee to approve the 2022 Board Governance and Personnel Committee Work Plan, as set forth in the attachment (ATTACHMENT B). 

MOTION:  2022-03 SERS BOARD MEMBER & DESIGNEE EDUCATIONAL PLAN
Meeting Date: March 4, 2022

RESOLVED:  That the board accepts the recommendation of the Board Governance and Personnel Committee to approve the State Employees’ Retirement Board Educational Training Plan for Board Members and Designees, as set forth in the attachment (ATTACHMENT A). 

MOTION:  2022-02 APPROVAL OF CONSENT CALENDAR
Meeting Date: March 4, 2022

RESOLVED:  That the board approves the Consent Calendar items, as listed, for the March 4, 2022, board meeting.

MOTION:  2022-01 ADOPTION OF THE AGENDA
Meeting Date: March 4, 2022

RESOLVED:  That the board adopts the agenda for the March 4, 2022, board meeting.    

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