The report maintains that public pension funds are becoming more cost effective. On average, funds paid 60 basis points in investment management and advisory fees, a decrease of 1 basis point from 2014.

But the study also shows that some funds pay exorbitantly higher fees. One fund with about 700 participants is paying 300 basis points in management fees. The NCPERS report does not break out the name of the funds or their specific value.

Several funds are paying more than 225 basis points in fees; several funds with at least 10,000 participants are paying more than 100 basis points in fees, as are several other funds with more than 100,000 participants.

The average of 60 basis points paid in fees on $2 trillion of assets amounts to $12 billion.

Investment returns were one reason behind the improved funding status, NCPERS' report says. The one-year average return for the funds was 11.2 percent, in spite of lackluster equity markets in calendar year 2015.

Not all responding funds have the same fiscal-year ending date, notes the report. A NCPERS spokesperson explained that investment return data was measured for the fiscal year ending in September 2015, meaning some funds benefited from strong equity market returns into the end of calendar year 2014.

The three-year average return for investments was 10.7 percent; the five-year average 11.2 percent; the 10-year average 7 percent; and the 20-year average 8.5 percent, according to the study.

The average one-year assumed rate of investment return is 7.5 percent, down 0.2 percent from 2014. The inflation assumption remained steady at 3.2 percent.

Domestic equity was the most heavily weighted asset, with the funds averaging a 29.7 asset allocation to U.S. stocks. Domestic equity returned an average of 33.4 percent.

Domestic fixed-income was the second highest average asset allocation, at 15 percent. Its one-year average return was 11.9 percent.

Pension funds continue to lower their amortization periods, another factor in the improved average funding ratio. The average amortized time calculated was 25.2 years, down from 25.9 years in 2014.

Also, plans that use a five-year pension-smoothing period, which allows funds to endure precipitous market declines and consequent funding requirements by spreading out liabilities over the five-year period, are now beyond the shadow of the financial crisis, a factor also aiding in improved funding status.

Investment returns accounted for 75 percent of average plan revenue in 2015, while employer contributions were 19 percent, and participant contributions were 7 percent, a one percent drop from 2014.

In the past two years, 41 percent of plans have increased employee contributions, and another 11 percent plan to in the next two years, according to the report.