Pension Stabilization Trust
Kim Sitton
Finance Director
January 7, 2026
Ask…
That the City Council/Pension Stabilization
Trustee Board:
• Reviews the provided information
• Approves $2.3 million contribution to the
City's Pension Stabilization Trust
2 City of Corona
Agenda
• Pension Stabilization Trust Background and
Investment Reports
• Unfunded Accrued Liabilities (UAL)
• FY 2026 Trust Contribution
3 City of Corona
4 Pension Stabilization
Trust Background and
Investment Reports
City of Corona
Pension Stabilization Trust Background
5 City of Corona
• Pension Obligation Bonds issued in 2021 • Pension Management Policy approved in 2021 • Pension Stabilization Trust approved in 2022 • Goal of paying off the bonds once callable (10 years) • Original Trust Board Members: City Treasurer, City Manager, Assistant City Manager, Finance Director, and Accounting Manager • Review updated PERS and Trust information; provide funding recommendation to Council annually • Updated Trust Board Members (approved in 2025): City Council members • Staff presents PERS and Trust information directly to the Council/Board and recommendation annually • Reaches a broader audience and makes the process more efficient 6 $59,184,080
Market value, as of November 30, 2025
City’s website, under Finance Department, Investments
https://www.coronaca.gov/government/departments-divisions/finance/city-treasurer/investment-policy • Pension Stabilization Trust Investment Report
(at the end of the Monthly Investment Report)
• Monthly Investment Report is also posted monthly with Council Agenda (generally 2nd meeting of the month)
• Pension Stabilization Trust Investment Policy
City of Corona
Trust Value and Investment Reports
7 Unfunded Accrued
Liabilities (UAL)
City of Corona
CalPERS – UAL and Funded Ratios
8 City of Corona
*Fire PEPRA no longer reported separately by CalPERS.
Funded 90.9%
Unfunded 9.1%
Miscellaneous
Funded 90.7%
Unfunded 9.3%
Police
Funded 91.7%
Unfunded 8.3%
Fire
Unfunded
Liability
Funded
Ratio
Fire * 19,948,149 91.7%
Police 34,960,417 90.7%
Miscellaneous 42,886,952 90.9%
Total $97,795,518
June 30, 2023 $108,320,838
June 30, 2024 $97,795,518
Year over Year ($10,525,320) -9.7%
Plan
June 30, 2024
CalPERS – Factors That Impact Unfunded Accrued
Liability (UAL) and Employer Contributions
9 City of Corona
• Investment Returns - Discount Rate (Rate of Return) Estimated 6.8% • FY 2024 results = 9.3%, +2.5% more than estimated • FY 2025 results = 11.6%, +4.8% more than estimated (reflected in next year’s report) • Member Demographics • Salary Increases • Actuarial Assumption Changes CalPERS – Net Investment Returns Over Time
City of Corona 10
30 Years 7.6%
20 Years 6.7%
10 Years 7.1%
5 Years 8.0%
1 Year (2025) 11.6%
• CalPERS Funding Risk Mitigation Policy • Returns greater than 2% or more, prompts discussion on a possible rate reduction • Lower discount rate can soften the blow when investment returns stumble • Lower discount rate means that more of the contributions must be covered by employer contributions • July 2025 - CalPERS affirmed 6.8% discount rate as part of its Asset Liability Management (ALM) process.
Funding Target for Pension Obligation Bond Payoff
11 City of Corona
• Bond Payoff Target (per Pension
Management Policy) is after 10 years
(after May 1, 2031) • Funding contribution of $2.3 Million per year (years 5-10) to Trust,
assuming 5% average returns • Since inception, returns = 12.68% • Total City contributions to date =
$40.85 Million
Contribution
Year FY (in Millions)
1 2022 $30.00
2 2023 $2.10
3 2024 $6.05
4 2025 $2.70
5 2026 Target $2.30 (Est.)
6 2027 Target $2.30 (Est.)
7 2028 Target $2.30 (Est.)
8 2029 Target $2.30 (Est.)
9 2030 Target $2.30 (Est.)
10 2031 Target $2.30 (Est.)
12 FY 2026
Trust Contribution
Discussion
City of Corona
Staff Recommendation
13 City of Corona
• Contribute $2.3 Million to the Trust for FY 2026
Ask…
That the City Council/Pension Stabilization
Trustee Board:
• Reviews the provided information
• Approves $2.3 million contribution to the
City's Pension Stabilization Trust
14 City of Corona