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State's public employee pension fund shows strong growth

New York's big state and local government employee pension fund is continuing its rebound, the state comptroller reported Wednesday.

In news that should lower future public employer pension expenses, and therefore help local payers of property tax, State Comptroller Thomas P. DiNapoli estimated that the New York State Common Retirement Fund grew at a clip of nearly 6 percent in the last year to a total of $150.3 billion.

The returns are estimated by DiNapoli's office and still must be audited by private accountants, but the comptroller said the fund's total holdings are now the highest since 2009. The system handles the pensions for state and local government workers across New York, and the Wall Street meltdown in recent years has contributed to markedly higher pension expenses -- and pressure on property taxes -- for public employers.

The formula by which public employers must fund employee pensions is smoothed out over a five-year period, so officials noted that this year's performance will start to show up in contribution rates later this fall for state and local governments.

DiNapoli attributed the rising performance levels to diversified holdings and "a long-term view" of the market.

The fund's estimated value has grown by nearly $10 billion since the end of December. Some of DiNapoli's numbers are based on actual market performance, while others are estimated values. For instance, 30 percent of the fund's holdings is invested in domestic stocks, and that sector saw a 6.9 percent return on the fund's investments.

The fund also invests in the real estate industry, from shopping malls to apartment buildings. They account for 6 percent of the fund's holdings, and DiNapoli estimated that those investments grew -- based, in part, on values his managers place on the properties -- at 17.6 percent, the strongest category of returns for the fund.

The pension fund makes retirement and death benefit payments to about 400,000 people each year and has 656,000 current and former government workers as members. In terms of assets, it is the third-largest public pension system in the country, trailing only two retirement systems in California.