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Alabama RSA-1 Deferred Compensation Plan
| Alabama RSA-1 Deferred Compensation Plan | |
 | |
| Basic facts | |
| Location: | Montgomery, Alabama |
| Top official: | Luke Hallmark, chairman |
| Year founded: | 1986 |
| Active members: | 42,075 |
| Website: | Official website |
| Total assets under management | |
| 2023: | $2,441,689,042 |
- See also: Public pensions in Alabama
The RSA-1 Deferred Compensation Plan (RSA-1) is a Alabama state pension fund that provides retirement, disability, and survivor benefits to the state's public employees. RSA-1 had $2,441,689,042 ($2.4 billion) in total assets under management as of September 30, 2023.[1]
The management of public pension funds can indicate support or opposition to environmental, social, and corporate governance (ESG) investment practices. ESG investing considers the extent to which corporations align with and promote certain non-financial standards, such as net carbon emission or corporate board diversity goals. States typically hire asset management companies (AMCs) to direct pension plan investments, some of which have ESG commitments that guide their strategies.
This article features the following sections:
- Background: Information about the structure and functions of RSA-1.
- Pension performance overview: Overview of the funding level and assets managed by RSA-1.
- Assets and asset management: Information about the asset management companies (AMCs) that contract with RSA-1, including a list of contracting AMCs that are participants in the Net Zero Asset Managers Initiative and the Climate Action 100+ initiative.
- Governance and accountability: Details about RSA-1's oversight board, including members and selection.
Background
- See also: Public pensions
The RSA-1 Deferred Compensation Plan (RSA-1), founded in 1986, invests the assets of and provides funding for Alabama’s public employees. RSA-1 is a deferred compensation plan wherein an employee can defer a portion of their salary to be received at a later, determined date. They can receive a lump sum, a monthly disbursement, or a partial lump sum with a monthly disbursement.[2][1]
RSA-1 served over 42,075 active as of September 30, 2023. Ballotpedia could not identify the number of retirees according to the information published on the Retirement Systems of Alabama website.[2]
Pension performance overview
The following table features information about the funding level and assets managed by the RSA-1 Deferred Compensation Plan as of September 30, 2023:[1]
| RSA-1 Deferred Compensation Plan pension performance (September 30, 2023) | |||
|---|---|---|---|
| Fiscal year | Total assets[3] | ||
| 2023 | $2,441,689,042 | ||
Note: Unfunded liabilities and funded ratio numbers were not provided in the most recent RSA-1 financial statement.
Assets and asset management
| Environmental, social, and corporate governance |
|---|
|
| • What is ESG? • Enacted ESG legislation • Arguments for and against ESG • Opposition to ESG • Federal ESG rules • ESG legislation tracker • Economy and Society: Ballotpedia's weekly ESG newsletter |
Asset management companies (AMCs) are hired to manage asset investment for state pension funds across all 50 states.
As of October 2024, 330 AMCs were members of the Net Zero Asset Managers Initiative (NZAM), and 391 AMCs were investor participants in the Climate Action 100+ initiative. Both international asset manager initiatives aimed to align the investment decisions of signatories with the goal of achieving net zero greenhouse gas emissions by 2050.[4][5]
NZAM announced on January 13, 2025, that it was suspending operations and removing the commitment statement and list of signatories from its website. The group said in a statement it would reevaluate its plans and operations in light of “[r]ecent developments in the U.S. and different regulatory and client expectations in investors’ respective jurisdictions.”[6]
List of AMCs contracting with the RSA-1 Deferred Compensation Plan
The RSA-1 Deferred Compensation Plan (RSA-1) contracted with one asset management company (AMCs) or specific fund as of 2021. The company was not an investor participant in Climate Action 100+, but was a member of NZAM, as of 2024. The following list identifies the AMC (and in some cases, the specific fund) contracting with RSA-1:[7]
- State Street (NZAM)
Governance and accountability
This section features information about the board of control that oversees the RSA-1 Deferred Compensation Plan (RSA-1). The board is specific to oversight of RSA-1 and does not exercise oversight duties for other state funds.[8]
Board selection method
The board of control that oversees RSA-1 is made up of four members as of August 17, 2021. The board of control, titled the PEIRAF or the RSA-1 board, comprises members of the investment committees from both the Teachers’ Retirement System Board of Control and the Employees’ Retirement System Board of Control.[8][9]
Board of trustees membership
A board of control oversees the operation and administration of RSA-1. The following individuals served on the board as of August 2021:[8]
- Luke Hallmark, chairman
- Jim Fibbe
- Ricky Whaley
- Bill Poole
See also
- Public pensions in Alabama
- Environmental, social, and corporate governance (ESG)
- Arguments about environmental, social, and corporate governance (ESG)
- Opposition to environmental, social, and corporate governance (ESG) investing
- Reform proposals related to environmental, social, and corporate governance (ESG)
- State legislative approaches opposing ESG investing
- State legislative approaches supporting ESG investing
External links
Footnotes
- ↑ 1.0 1.1 1.2 Retirement Systems of Alabama, “Public Employees’ Individual Retirement Account Fund/Deferred Compensation Plan (A Component Unit of the State of Alabama) FINANCIAL STATEMENTS For the Fiscal Year Ended September 30, 2023
- ↑ 2.0 2.1 The Retirement System of Alabama, “RSA-1 Member Handbook,” May 29, 2024
- ↑ Note: By default, this refers to the actuarial valuation of total assets. In some cases, the total market value of assets is shown instead. See the cited source for details.
- ↑ The Net Zero Asset Managers Initiative, "The Net Zero Asset Managers Initiative," accessed January 26, 2023
- ↑ Climate Action 100+, "The Three Goals," accessed June 20, 2023
- ↑ Pensions and Investments, "Net Zero Asset Managers initiative to suspend activities in wake of BlackRock departure," accessed January 15, 2024
- ↑ Ballotpedia, "Ballotpedia: Asset management data for state-administered pension funds across the 50 states," March 2023
- ↑ 8.0 8.1 8.2 Retirement System of Alabama, “Member Handbook,” May 29, 2024
- ↑ Retirement Systems of Alabama, “PEIRAF/RSA-1 BOARD OF CONTROL MEETING,” May 29, 2024
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