Vermont Municipal Employees' Retirement System

Overview

Established in 1975, the Vermont Municipal Employees' Retirement System (VMERS) is a state-administered pension plan that offers retirement benefits to municipal employees across Vermont. Governed by Title 24, V.S.A., Chapter 125, VMERS serves as a uniform retirement system for participating municipalities, ensuring consistent and reliable benefits for its members. The system is managed by the Vermont Pension Investment Commission, which oversees the investment of assets for the state teachers' retirement system, the Vermont state employees' retirement system, and VMERS. This commission strives to maximize total return on investment within acceptable risk levels, adhering to the prudent investor rule under 14A V.S.A. 902. VMERS's investment strategy encompasses a diverse range of asset classes, including fixed income, equities, real estate, private equity, infrastructure, hedge funds, commodities, distressed and special situations, and ESG and impact investing. The system focuses on various investment stages such as growth, late stage, buyout, turnaround, and distressed investments. Geographically, VMERS primarily concentrates on the United States, aligning with its mission to support the retirement needs of Vermont's municipal employees. The system's portfolio spans multiple industries, including financial services, real estate, infrastructure, energy, healthcare, technology, consumer goods, telecommunications, utilities, materials, industrials, consumer services, basic materials, and consumer non-durables. As of June 30, 2024, VMERS had approximately 360 contributing employers, with 8,692 active members, 4,638 inactive members, 1,160 terminated vested members, and approximately 4,638 retirees and beneficiaries. The actuarial value of the fund was $1,015 million, reflecting a growth from $946.4 million as of June 30, 2023. During fiscal year 2024, the system paid approximately $54.4 million in retirement benefits. The Board of Trustees, responsible for the administration of the system, consists of the State Treasurer, one representative designated by the Governor, and two municipal employees and one municipal official, all elected by the membership of the system. Staff is provided by the Retirement Division of the State Treasurer's Office, which also administers the Vermont State Retirement System and the State Teachers' Retirement System. VMERS's investment philosophy emphasizes prudent and diversified investment strategies to ensure the long-term sustainability of the fund, aiming to provide secure and reliable retirement benefits to Vermont's municipal employees. The system's commitment to responsible investing is evident in its adoption of an Investment Policy Statement and a Watchlist Policy, which outline the investment monitoring process and criteria for identifying and addressing underperforming investments. These policies are publicly available, reflecting VMERS's dedication to transparency and accountability in managing the retirement assets entrusted to it by the state's municipal employees.