Institutional Federal Compliance Report 2021

Expected Rate of Return The long-term expected rate of return on pension plan investments was determined in accordance with Actuarial Standards of Practice (ASOP) No. 27, Selection of Economic Assumptions for Measuring Pension Obligations (ASOP No. 27), which provides guidance on the selec- tion of an appropriate assumed investment rate of return. Consideration was given to the expected future real rates of return (expected returns, net of pension plan investment expense and inflation) for each major asset class as well as historical investment data and plan performance. Best estimates of arithmetic real rates of return for each major asset class included in TRS’s target asset allocation as of the valuation date of June 30, 2016 are as follows: 110 • Notes to Basic Financial Statements _________________________________________________________________________ Long-Term Target Expected Rate Asset Class Allocation of Return Domestic equities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37% 6.1% International equities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18% 7.3% Real estate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10% 5.4% Private equities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7% 9.2% Domestic fixed income securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17% 1.0% Global fixed income securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2% 0.8% Mortgages . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8% 3.1% Short-term investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1% 0.1% Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100%

Discount Rate The discount rate used to measure the total pension liability at June 30, 2016 was 7.5 percent, as compared to 8 percent at the June 30, 2015 measurement date. The projection of cash flows used to determine the discount rate assumed that contributions from plan members will be made at the current member contri- bution rates and that contributions from employers will be made at statutorily required rates, actuarially determined. Based on these assumptions, the fiduciary net position was projected to be available to make all

projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability. The following presents the net pension liability (asset) of SUNY, calculated using the discount rate of 7.5 percent as well as what SUNY’s net pension liability (asset) would be if it were calculated using a discount rate that is 1 percentage point lower (6.5 percent) and 1 percentage point higher (8.5 percent) than the current year rate (amounts in millions): 1% Current 1% Decrease Assumption Increase (6.5%) (7.5%) (8.5%) and their beneficiaries. Pension benefits are generally based on the highest five-year average compensation of the final ten years of employment, and years of credited service as outlined in the plan. Covered employees with five or more years of service are entitled to a pension benefit beginning at normal retirement age (65). Participants become fully vested after five years of service. Participants with less than five years of service are not vested. The funding policy is to con- tribute enough to the Upstate Plan to satisfy the annual required contribution. Employer contributions for 2017 were $2.8 million. Employees do not contribute to the plan. At December 31, 2016, membership of the Upstate Plan totaled 1,564 members, comprising 421 active members, 408 inactive vested members, and 735 retirees and beneficiaries currently receiving benefits. The Upstate Plan issues a stand-alone financial report on a calendar year basis that includes disclosure about the elements of the plan’s basic financial statements. 114.1 $ 8.7 $ (79.6)

Net pension liability (asset) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $

Upstate Medical University Plan for Former Employees of Community General Hospital

SUNY administers a single-employer defined-benefit plan, the Upstate Medical University Retirement Plan for Former Employees of Community General Hospital (CGH) (Upstate Plan). This plan provides for retire- ment benefits for former employees of CGH, and can be amended subject to applicable collective bargaining and employment agreements. For those who opted out of this plan, benefit accruals were frozen. No new participants can enter this plan. SUNY established a Pension Oversight Committee (Committee) which has the primary fiduciary responsibility for oversight of the Upstate Plan. The Committee is permitted to invest plan assets pursuant to various provisions of State law, including the RSSL. The Upstate Plan provides retirement, disability, termination and death benefits to plan participants