ATLANTA — Despite an initial $15 billion loss, Georgia’s teacher retirement system is still in a “good spot” to withstand the economic downturn brought on by the response to COVID-19, according to a local analyst.

Stephen Owens, Georgia Budget & Policy Institute’s education analyst, estimated the Teachers Retirement System of Georgia (TRS) by now has recovered half of what it lost last month when the stock market crashed in response to the COVID-19 pandemic.

However, Owens said the determining factor in the system’s overall ability to bounce back from COVID-19’s economic fallout will be how the system ends the 2019-2020 fiscal year.

“If the stock market can rally before July 1, we might see this as just a short blip,” Owens said.

TRS representatives declined to comment to The Center Square for the story.

According to TRS’ 2019 annual report, 70 percent of its fund is invested in stocks. The pension system, which manages retirement benefits for the state’s teachers, had shares with a fair value of $53 million at the end of 2019. Its biggest shares were in Microsoft Corp. and Amazon.Com Inc.

TRS has about 400,000 members and pays $4.7 billion a year to its retirees. 

Its assets have grown by $19 billion over the past three-and-a-half years. L.C. “Buster” Evans, executive director of the system, told lawmakers in February the system’s total assets were $84.6 billion. By March 25, the system had lost $15 billion, he told the Atlanta Journal-Constitution.

Georgia’s pension system, which also includes the Georgia Employees Retirement System, is among the top 20 pension systems in the nation based on how well its is funded, according to the Tax Foundation.

Buster told members of the House Appropriations subcommittee in February that TRS had 77.4 percent of the funding it needs to finance the retirement of its members. 

A Milliman study released Thursday found the funded status of the nation’s top 100 public pensions declined by $485 billion in the first quarter of 2020. Funded ratios dropped from 74.9 percent at the end of December to 66 percent at the end of March.

Owens said if the losses continue, TSR administrators may have to consider increasing employee contributions. However, he said because the system has kept a good track record of paying the full value of the pension, it should be able to recover.

“Georgia is in a good spot as well because we’re one of the few states in the nation that has always paid the amount that’s recommended by an actuary,” he said.