HARRISBURG, PA – During public meetings this week, the Board of Trustees of the Public School Employees’ Retirement System (PSERS) approved a $7 million legal settlement involving claims alleged in a lawsuit filed by PSERS against a former consultant, Aon Investments USA (Aon).
The resolution reads in part:
RESOLVED, that the Public School Employees' Retirement Board (“the Board") hereby authorizes the settlement of the claims of the Board against Aon Investments USA Inc. (“Aon”) and the lawsuit brought against Aon in the Court of Common Pleas of Philadelphia County, Pennsylvania, Case No. 221102792 in exchange for a lump sum payment of $7,000,000.
“On behalf of the Board of Trustees, I am pleased to see this matter resolved amicably so that the board and staff may continue to focus on the important work ahead of us,” Board Chairman Richard Vague said. “This resolution is a clear reminder that we take our stewardship of the assets and resources entrusted to PSERS seriously, and that we always strive to effectively and prudently serve our members’ retirement needs.”
No further comment will be issued on the litigation or settlement.
The board also acted upon other matters, including the approval of five investments, which total approximately $720 million. The investment commitments made today include:
- $175 million to ACORE Opportunistic Credit II, L.P., private credit
- $100 million to Summit Partners Growth Equity Fund XII-A, L.P, private equity
- $125 million to LLR Equity Partners VII, L.P, private equity
- $100 million to Peppertree Capital Fund X, L.P., private infrastructure
- €200 million to Blackstone Infrastructure Partners Europe (CYM) L.P, private infrastructure.
PSERS will allocate new dollars to the ACORE, Summit Partners, LLR, and Peppertree commitments pending final contract approvals, Chief Investment Officer Ben Cotton said during an Investment Committee meeting on Thursday. Cotton added that the commitment to Blackstone’s new European-focused fund will facilitate reallocation of capital within Blackstone’s infrastructure-focused funds.
In other investment matters, Cotton said the 2023-24 fiscal year net investment return is expected to be above 8.00% when final numbers are tallied later this year. The system’s assumed rate of return is 7.00%. The board also reviewed potential changes to the fund's asset allocation, which will be revisited and voted upon during its October meeting.
For a list of all upcoming meetings, see PSERS website.
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About the Pennsylvania Public School Employees' Retirement System
PSERS, founded in 1917, began operations in 1919 to oversee a statewide defined benefit pension plan for public school employees. PSERS' role expanded upon the passage of Act 5 of 2017 to include oversight of two new benefit options consisting of defined benefit and defined contribution (DC) components and a stand-alone DC plan. As of March 31, 2024, PSERS had total net assets of $76.5 billion and a membership of about 251,000 active, 250,000 retired school employees and 27,000 vested inactive members.