February Board Meeting Summary

The Public School and Education Employee Retirement Systems of Missouri (PSRS/PEERS) Board of Trustees convened at 8:30 a.m. Feb. 2, 2026, at the PSRS/PEERS offices located at 3210 W. Truman Blvd., Jefferson City, Missouri. In attendance were Board members Beth Knes, Dr. Eric Park, Allie Gassmann, Katie Webb, Chuck Bryant, Dr. Nate Moore, and Amanda Perschall. Also present were Executive Director Dearld Snider; Chief Operating Officer Sarah Swoboda; Chief Investment Officer Craig Husting; Chief Counsel Mike Moorefield; Chief Financial Officer Brandon Robertson; Director of Human Resources Michelle Varcho; Director of Member Services Nicole Hamler; Director of Employer Services Stacie Verslues; Director of Internal Audit Jeff Hyman; Chief Technology Officer Lisa Scheulen; Director of Communications Susan Wood; Chief Information Security Officer Jake Woratzeck; Director of Executive and Board Administration Jennifer Martin; and other PSRS/PEERS staff members.

System Operations

Approval of Minutes

The open session minutes from the Dec. 15, 2025, meeting were approved by unanimous vote.

Order of Business

The order of business was approved with no changes.

Other

PSRS/PEERS Executive Director Dearld Snider, Chief Operating Officer Sarah Swoboda, and Member Services Director Nicole Hamler presented retirement plaques to Mark Berendzen and Sheri Morgan for their dedication and service. Berendzen will retire on May 1, 2026, and Morgan will retire on June 1, 2026.

Investment Report

Investment Performance Report (12/31/25)

Craig Husting from PSRS/PEERS and Michael Hall from Russell reviewed the investment performance for the period ended Dec. 31, 2025. The one-year PSRS/PEERS investment return was 13.3%, while the fiscal year return (July 1, 2025, through Dec. 31, 2025) was 5.9%.

Ongoing Investment Activity

Husting and Hall reviewed ongoing investment activities, which included estimated investment performance through Jan. 31, 2026. Husting discussed the current asset allocation of the PSRS/PEERS portfolio, and he reviewed the long-term strategy and the broad portfolio expectations.

Anti-Terrorism and Economic Sanctions Policy

Husting reviewed the Systems' Anti-Terrorism and Economic Sanction Investment Policy. The Board adopted the policy in 2005 and last reviewed it in August 2025. The policy requires PSRS/PEERS staff to provide an annual report to the Board identifying any investment actions taken due to links to terrorist- or sanction-related activities.

Husting stated that the Systems have several safeguards in place to ensure compliance with the  policy, including:

• On an annual basis, staff send letters to selected federal officials requesting any information on companies that, in their opinion, have terrorist links.
• Based on guidance from the U.S. Department of Commerce and other sources, staff monitors several websites, including the Specially Designated Nationals List. Staff compares the lists to the PSRS/PEERS active holdings monthly.
• The Systems' custodian bank (J.P. Morgan) is required by federal law to monitor all individual security holdings in the Systems' investment accounts.
• The Systems have amended contracts with traditional external investment managers to require annual confirmation that each manager maintains appropriate policies, procedures, and controls to comply with all U.S. and applicable non-U.S. economic sanction programs.
• The Systems contracted with a sanctions-screening product to provide additional insight into sanction lists and publicly traded securities.

The staff also submitted a report to the Missouri Legislature on Dec. 31, 2025, to comply with recent statute changes. At the end of the report, Husting stated that staff is not aware of any instances of non-compliance for the year. Both staff and general counsel recommended that no investment action be taken this year with regard to the Anti-Terrorism and Economic Sanctions Investment Policy.

Affirmative Action Policy

Husting reviewed the Systems' Affirmative Action Policy and Procurement Action Plan. The Board last revised the policy in December 2022 and last reviewed it in August 2025. The policy requires PSRS/PEERS staff to provide an annual report to the Board regarding the Systems' efforts to ensure equal opportunities for minorities and women as money managers, brokers, and investment counselors. Husting stated that the Systems were in compliance with the policy.

Sections 105.702, and 169.573, RSMo require the Systems to make an annual report to the Governor's Minority Advocacy Commission and the Joint Committee on Public Employee Retirement regarding the progress made in the utilization of minority and women money managers, brokers, and investment counselors. Staff submitted the required reporting on Jan. 17, 2025.

At the end of the report, Husting stated that both staff and general counsel recommended that no investment action be taken this year regarding the Affirmative Action Policy and Procurement Action Plan.

Timeline for 2026 Experience Study

Brandon Robertson from PSRS/PEERS updated the Board on the schedule of asset and liability studies occurring during FY26 and related actions items for the Board. The studies include:

• Investment Beliefs: Interviews and analysis to reaffirm beliefs, reduce volatility, and guide asset allocation.
• Asset/Liability Study: Review asset classes, allocation efficiencies, and expected returns.
• Actuarial Experience Study: Evaluate the actuarial assumptions and methods utilized in the annual actuarial valuations.

The anticipated schedule for reporting to the Board and implementation of any amendments to the Board's policies is as follows:

• Key Milestones
  • Dec. 15, 2025 – Investment beliefs report and recodification
• Feb. 2, 2026 – Asset/Liability Study report and recommendations on allocation and expected return
• April 20, 2026 – Actuarial experience study report and preliminary recommendations
• June 15, 2026 – Experience study recap and adoption of any changes to the funding policy
• Implementation
  • June 30, 2026 – Actuarial valuations
  • Jan. 1, 2027 – COLA adjustments
  • July 1, 2027 – June 30, 2028 – Updated contribution rates
  • FY27 – Begin implementation of any asset allocation changes

Outcome: Updated investment beliefs, actuarial assumptions, and funding policy to ensure long-term sustainability.

Asset Liability Study

Husting and Hall presented the Asset/Liability study. The presentation included a review of historical PSRS/PEERS Asset/Liability studies, a review of the PSRS/PEERS investment philosophy, capital market expectations, and an asset allocation recommendation. Husting and Hall provided 10-year expected risk and return estimates for the current asset allocation and for the recommended asset allocation.

Husting and Hall recommended a minor change to the asset allocation that increased asset allocation leverage to 3%. The Board voted on and approved the recommendation.

Economic Overview

Mary Tolan and Matt Doyle from Chicago Pacific Founders provided an overview on the state of U.S. health care and trends in the industry. Their presentation covered several topics, including caring for aging populations and the use of AI in health care.

Management Report

Change Aug. 31, 2026, Board Meeting Date and Set February, April, and June 2027 Dates

The Board voted to change the Aug. 31, 2026, Board meeting date to Wednesday, Sept. 2, 2026. The Board also reviewed and unanimously approved the Board meeting dates for February, April, and June 2027: Feb. 8, 2027; April 19, 2027, and June 8, 2027.

Approve RFP for Board Election

The Board voted unanimously to delegate to PSRS/PEERS staff (Request for Proposal committee that reports recommendation to executive director) the authority to approve the Request for Proposal for the election.

Legislative Update

Mike Moorefield from PSRS/PEERS and government relations consultant Doug Nelson presented the February legislative update.

Moorefield and Nelson gave the Board an overview of the governor's fiscal year 2026 budget recommendations and various legislative priorities of the General Assembly. Additionally, Nelson and Moorefield provided an overview of general legislative activity of the General Assembly. Finally, Moorefield and Nelson discussed PSRS/PEERS' priority tracked legislation. This includes three bills that could affect Investment Mandates/System Governance (HB 1668, which covers foreign adversary divestment; SB 1061, which prohibits firearm discrimination; and SB 1302, which prohibits environmental, social, and governmental preferences). Other priority bills PSRS/PEERS is tracking are HB 2091, which expands PEERS Critical Shortage Employment; HB 2095, which modifies the COLA cap; HB 2144, which increases the PSRS death benefit; HB 2396, which changes WAR limits; HB 3079, which moves speech language pathologists to PSRS; and SB-1258, which raises the multiplier for PSRS retirees with at least 33 years of service to 2.6%.

As of Jan. 30, 2026, more than 2,600 bills and resolutions have been filed by the 2026 General Assembly. PSRS/PEERS is tracking more than 75 bills.

Year in Review/Areas of Impact

Dearld Snider and Sarah Swoboda from PSRS/PEERS presented a year in review to the Board. This presentation focused on five key areas of impact and highlighted some of the major accomplishments from each during 2025. Snider began by reminding the Board about PSRS/PEERS' exceptional financial results. The pre-funded status for both Systems increased; we gave a cost-of-living adjustment (COLA) for the sixth year in row; and for 16 consecutive years, school contribution rates held steady.

Swoboda discussed the first area of impact: members and employers. She focused on the implementation of the School Administrators Resource webpage; going live with Phase 2 of the Document Center, which enhances functionality and automation in Web Member Services; and the implementation of the PSRS/PEERS podcast, Benefit Connections.

The second area of impact Swoboda discussed was staff. She highlighted PSRS/PEERS being recognized for the third year in a row as one of Pension & Investments "Best Places to Work in Money Management," as well improvements in Human Resources processes. She also highlighted the successful development and training of staff, the migration of our public website to the cloud, and two awards related to funding and financial reporting.

The third area of impact Swoboda covered was investments. She highlighted the investment summer internship program, which continues to develop future talent, and three investment staff awards.

The fourth area of impact Swoboda discussed was the Board of Trustees. She highlighted the Board being recognized as finalists for two industry awards last year. She also emphasized the Board reviewing and adopting updated Investment Beliefs, guiding PSRS/PEERS' investment programs.

The fifth, and last, area of impact Swoboda reviewed was government relations. She discussed the successful 2025 legislative year, which saw no negative legislation impacting PSRS/PEERS and the passage of positive legislation supporting working retirees and the systems' investment programs.

CPI-U Update

Snider reviewed the COLA policy that was set by the Board of Trustees at their Nov. 3, 2017, meeting. According to the policy, COLAs may be granted based on the Consumer Price Index for Urban Consumers (CPI-U) as follows:

Snider explained that the CPI-U is calculated by the Bureau of Labor Statistics (BLS). The CPI-U is the measure of the change in prices of goods and services purchased by urban consumers between any two time periods. PSRS/PEERS regulations require that the time period for the CPI-U calculation used in the determination of a COLA be from June to June. Based on the values provided by the BLS, the CPI-U is 0.46 % through Dec. 31, 2025.

Public Comment

None

Other

None

Closed Session

The Board went into closed session at 12:14 p.m.

Adjournment

The Board adjourned at 1:22 p.m.

This summary is not the official minutes of the PSRS/PEERS Board of Trustees meeting. The official minutes will be approved at the next PSRS/PEERS Board of Trustees meeting and will be posted to our website at that time.