The Pennsylvania State Employees' Retirement System (SERS) made $1 billion in the first quarter, thanks mostly to the rising stock market after President Trump's election. Hedge, buyout, and real estate funds, hired by the system as alternatives to low-yielding bonds, trailed far behind, as they often have in recent years.

SERS continues to buy those private investments, in hopes of beating its 7.25 percent long-term yearly return target. Among the system's recent investments is up to $100 million for Apollo Investment Fund IX, the latest $20 billion-plus buyout fund raised by Apollo Global Management LLC, the New York firm whose billionaire partners include lead 76ers owner Josh Harris.

Apollo specializes in buying troubled companies. Targets over the years have included the landfill operator Allied Waste, crane operator AmQuip, casino owner Caesars, Century 21 parent Realogy, chemical-maker LyondellBasell, alarm service ADT, Converse sneakers, retail chain Linens 'n Things, and many more — and cutting costs to sell them at a profit.

Apollo's partners aren't mostly high-tech venture capitalists; they are fix-up artists who specialize in tough management decisions that earlier bosses didn't make, in hopes of grabbing enough cash to make the deals worthwhile, enriching the operating partners and clients.

Last August, Apollo agreed to pay SERS $30,000 as part of a larger $52 million settlement with clients and the Securities and Exchange Commission. The agency says Apollo failed to properly disclose all the payments it was extracting from companies it invests in. These are the kind of payments not typically included by SERS when it reports fees it pays to more than 100 private money management firms.

The board knew about the settlement when it hired Apollo again, SERS spokesman Jay Pagni assured me. A spokesman for Apollo declined to comment. Clearly the SERS board of governor and legislative appointees, and its professional staff and advisers who recommend investments, trust that Apollo will return their money, with significant gains, after taking out fees and collecting profits.

How has Apollo done in the past? According to SERS' latest annual report to the General Assembly, the pension system's past investments include $75 million invested starting in 1998 in Apollo Investment Fund IV, which has so far yielded $125 million, for a profit of $50 million, not discounted for inflation or time.

Does that sound like a lot? It works out to less than 3 percent a year, over 19 years. It actually came back faster than that, for a while, since most of the profits were collected years ago, though some assets have not yet been turned to cash.

It's hard for us laymen to compare this result with other funds or SERS's own benchmarks: SERS doesn't post annual return rates for buyout-fund managers.

SERS also invested $50 million in Apollo's Fund V starting in 2001 (it has collected $122 million to date), $40 million in Fund VI in 2006 (with $52 million returned so far), and turned $52 million into $78 million, since 1998, in Apollo Real Estate Fund III.

Fund overseers agree it's now time to give Harris' firm another chance to work its magic, for pensioners, and for Harris and his partners.

Though it paid Apollo millions of dollars a year in fees until the last few years, SERS' Pagni tells me the pension fund hasn't had to pay Apollo any additional fees since at least 2014, as the aging funds have by now cashed in most of their investments and are "winding down."

He couldn't say how much SERS will pay Apollo for the new investment, as that's still being negotiated. The state teachers' pension fund (PSERS) pays Apollo additional millions for more recent investments. Philadelphia's underfunded pension system has also invested with Apollo.

The system voted this month to invest up to $100 million with another buyout firm, CVC Capital Partners VII, which will "focus on control and co-control buyouts in established upper middle market and large market global businesses primarily in Europe, and some in North America and the rest of the world," and a like amount with Insight Venture Partners X, LP, to "focus on growth-stage software, software-enabled services, and Internet companies."

Meanwhile, the premium that Pennsylvania taxpayers have to pay to keep SERS from slipping further toward insolvency has also risen, to an average 33.2 cents per dollar of payroll this year, from 29.5 cents last year. Taxpayers also pay 43 cents for state troopers (who don't pay into or receive Social Security) and 46 cents for legislators (whose pension credits are leveraged to rise faster than other workers), and less for many other classes of employees.

As I noted last week, the pension reform law signed by Gov. Wolf last week, which put future hires onto a part-guaranteed pension, part-401(k)-style savings plan, won't cut into current pensions or pension expenses for decades to come.

Is it worth hiring firms like Apollo? Even high fees can be justified if they bring high returns. It would be easier for legislators, state workers, and taxpayers to see if this money is well spent, if the pension system posted more information on what the money is buying and how it boosts the underfunded pension plan. And we'd have a better idea of how the billionaire fund managers, like the men who own Apollo, are profiting from the state's investments, if the money their firms collect from that public funding was fully and clearly disclosed.