Financial Report

FINANCIAL REPORT
The Railroad Retirement Board's 2016 railroad retirement financial report was submitted to Congress in June 2016. The report was generally favorable. It concluded that, barring a sudden, unanticipated, large decrease in railroad employment, or substantial investment losses, the railroad retirement system will experience no cash-flow problems during the next 25 years. The long-term stability of the system, however, is still uncertain. Under the current financing structure, actual levels of railroad employment and investment return over the coming years will largely determine whether corrective action is necessary. No financing changes were recommended.

As of September 30, 2016, total railroad retirement system assets, comprising assets managed by the National Railroad Retirement Investment Trust, and the railroad retirement system accounts at the Treasury equaled approximately $27 billion.

**Table 10. -- Railroad Retirement & Survivor Program U.S. Treasury Accounts Consolidated Financing Sources, Costs, and Net Position (Millions)1**
For the Fiscal Year Ended September 30	2016	2015
Financing Sources:
Payroll Taxes	$5,927.4	$6,432.5
Financial Interchange	4,123.7	4,057.0
Interest on Investments and Other Revenue	34.3	41.4
Federal Income Taxes	758.0	718.0
General Appropriations	32.8	36.8
Other	774.0	(1,566.1)
Transfers to the NRRIT	0.0	0.0
Transfers from the NRRIT	1,410.0	1,191.0
Total Financing Sources	13,060.2	10,910.6
Costs:
Benefit Payments	12,364.5	12,199.7
Interest Expense	97.5	101.1
Salaries and Expenses²	139.7	139.1
Other	(25.1)	(29.7)
Total Costs	12,576.6	12,410.2
Financing Sources over Costs	483.6	(1,499.6)
Net Position - Beginning of Period	25,147.8	26,647.4
Net Position - End of Period	$25,631.4	$25,147.8
¹ Prepared on an accrual basis of accounting.
² Includes unemployment and sickness insurance salaries and expenses of approximately $25.1 million and $18.1 million in each of the fiscal years 2016 and 2015, respectively.

Table 11.-- National Railroad Retirement Investment Trust (NRRIT)
Fiscal Year 2016 Summary
Market value of assets managed by NRRIT on September 30, 2016	$25.1 billion
Rate of return of investment portfolio managed by NRRIT for full year ended September 30, 2016	8.13%
Source: NRRIT All NRRIT annual management reports and quarterly updates are available online.

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