Illinois Police Fund Finishes Consolidation of Local Pensions

The Illinois Police Officers’ Pension Investment Fund has completed the consolidation of 351 local police pension funds, it announced Monday. Approximately 18 local pension funds had their assets transferred as part of the 14th and final group to be added, bringing the value of the IPOPIF’s assets under management to $12.9 billion.

“During this final tranche, approximately 2,100 line items valued at $1.6 billion were transferred to IPOPIF, bringing the total fund value to $12.9 billion as of the end of November,” said Kent Custer, the IPOPIF’s CIO, in a statement.

The IPOPIF was established in December 2019 by state law that mandated the consolidation of the state’s numerous police officer and firefighter pension funds into two investment funds, one for police and one for firefighters. There were 357 police pensions in Illinois; while 351 are now consolidated, another six are considered “special situations” which the Illinois Department of Insurance and the IPOPIF are evaluating, according to a statement.

The IPOPIF began consolidation of assets on March 1, 2022. This last tranche included the funds that had filed a lawsuit questioning the constitutionality of the legislation that established IPOPIF, a spokesperson for IPOPIF said.

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“Transferring assets from 351 separate local police pension funds was a monumental task for our investment and administrative teams at IPOPIF,” said Richard White, the executive director of the IPOPIF, in a statement.

The fund had $11.28 billion in assets under management as of September 30, prior to asset consolidation. The fund allocates 58.1% to a growth portfolio consisting of equities, 20.6% to risk mitigation strategies, 15.5% to fixed income and 5.8% to real assets.

The fund hired Deputy CIO Greg Turk in July to spearhead a push into the private markets. As of September, the fund’s investment policy calls for a 20% allocation to private markets, 7% of which would be private equity, 5% to both private credit and real estate, and 3% to infrastructure.

The Illinois Firefighters’ Pension Investment Fund, created by the same 2019 state law, completed its consolidation into a $7 billion fund by June 30, 2022. It reported more than $9.69 billion in assets under management as of September 30.