state pension fund

Moore's firm got $500 mill investment

markjohnson — Fri, 13 Nov 2009 12:35:58 -0500

Six months before former state Treasurer Richard Moore left office, the North Carolina pension fund that he oversaw invested more than $500 million in the investment fund firm that now employs him, the Insider reports.

Moore was named a managing director at San Diego-based Relational Investors in April of this year. The office of current Treasurer Janet Cowell confirmed that in July 2008 the pension fund signed an agreement to make a substantial investment with Relational Investors. The investment, as of Sept. 30, was valued at $508,623,784. It was the pension fund's first and only investment with the firm.

Ralph Whitworth, founding director of Relational Investors, said the investment and Moore's hiring were completely unrelated.

"If it creates a perception, that's unfortunate. Richard, after he left the state treasurer's office, was one of the most sought-after persons in finance," Whitworth said. "We were totally excited."

UPDATE: Moore responds to the story in an email to Dome. (After the jump.)

Dome memo: Ethics and fence-sitting

bniolet — Fri, 13 Nov 2009 06:18:32 -0500

GRADE STIMULUS: A Goldsboro middle school was lambasted this week for its plan to award extra test points — enough to raise a letter grade — in exchange for cash contributions for the school. The lesson for students: Hard work, perseverance and positive attitude will be rewarded. And if that doesn't work, a nice crisp $20 couldn't hurt.

CHOPPED LIVER; The race for the Democratic nomination to challenge U.S. Sen. Richard Burr got lots of attention this week. Lexington lawyer Cal Cunningham is out. U.S. Rep. Bob Etheridge is going for a new fence-sitting record. Two others are thinking about it. All the buzz about candidates who aren't running can't be flattering to the only two people who are: lawyer Kenneth Lewis and Secretary of State Elaine Marshall.

SHE'S BACK: Gov. Bev Perdue got a big bump in her job approval, apparently because of her refusal to release violent inmates despite a court ruling. Perdue has been hitting the public events pretty hard and making big announcements. A few more ribbon cuttings and another stand at a jail-house door and Perdue might just be liked again.

IN OTHER NEWS: Sen. Martin Nesbitt appears to have a lock on the job of Senate majority leader...The state's pension fund is beginning to recover from a financial slump...Barack Obama's campaign was the source of the tip that John Edwards got $400 haircuts.

Pension fund bumps up

markjohnson — Mon, 09 Nov 2009 15:09:36 -0500

North Carolina's state pension fund was buoyed in the third quarter by the stock market's slight rebound, State Treasurer Janet Cowell announced Monday.

Third quarter returns were 10.44 percent, and the fund's returns for the year are 12.26 percent.

The fund's value rose from $60.2 billion at the end of June to $65.8 billion at the end of September.

Cowell cautioned that the stock market remains volatile and the fund is still well below its 2007 peak of $77 billion, meaning that the legislature will need to appropriate more money to offset last year's losses.

Gerrick staff did daughter's homework

markjohnson — Mon, 26 Oct 2009 16:23:42 -0400

North Carolina's former chief investment officer, Pat Gerrick, asked some of her then-subordinates in the state treasurer's office to help her daughter with college homework.

In April 2007, Gerrick provided her daughter, Meredith, with the email addresses for five members of Gerrick's staff, who are charged with overseeing the state pension fund, currently worth more than $60 billion, according to emails provided under a public records request. The staff members responded with answers to several questions from an investment-oriented group project for Meredith Gerrick. The staff members included the operations manager for the investment management division and the fixed income portfolio manager.

Gerrick was fired by State Treasurer Janet Cowell in August amid questions about travel expenses and cell phone bills. Questions have also been raised about Gerrick's relationships with firms that did business with the state.

Gerrick said last week that she asked her staff for help with the homework but made clear it was not an order.

"I just sent it around," Gerrick said. "I think you’ll see on the email, it says, 'If you have time, if you want to do it.'"

Retirement commission in the works

markjohnson — Mon, 19 Oct 2009 11:34:26 -0400

State Treasurer Janet Cowell announced the creation of a new, 11-member commission to make recommendations for sustaining and strengthening the state pension fund.

The commission, whose members have not been named, will craft proposals for, among other needs: providing adequate retirement income, managing investments and their risks and attracting and retaining the workforce that state and local governments need.

Cowell, who oversees the state pension fund, made the announcement during a pre-retirement planning and workforce symposium at N.C. State University Friday. She said the current economic crisis provides an opportunity to design a retirement system for the state's future workforce.

"Hopefully North Carolina can be a model for a how a public plan can evolve through these times," Cowell said in a prepared statement, "and still have a strong, secure, and safe retirement for the people who lead a life of public service."

State pension fund dips

bniolet — Fri, 16 Oct 2009 08:21:29 -0400

North Carolina's state pension fund fell below the fully funded mark last year for the first time since 1997, State Treasurer Janet Cowell reported Thursday.

The state retirement system was 99.3 percent funded as of Dec. 31, 2008, which means it had slightly less money than it needs to pay the retirement benefits that are projected for the future, Mark Johnson reports. That estimation by actuaries is compiled once a year.

The funding level is likely to continue to decline as investment losses from the recession are spread over several years, Cowell cautioned in a prepared statement.

"State and local governments will need to continue to budget for increased contributions to the system,” she said.

The pension fund still ranks as one of the top five in the nation and remains funded well above the national average of 80 percent, Cowell's office said, quoting the National Association of State Retirement Administrators. In 2007, the system was overfunded at 104.7 percent.

Cowell will not give bonuses

ryanteaguebeckwith — Wed, 03 Jun 2009 13:42:01 -0400

Treasurer Janet Cowell will not give bonuses this year.

Last year, the legislature gave the state treasurer the authority to give performance-based pay bonuses to the chief investment officer and four directors of the state pension plan.

But a sagging economy and sensitivity to other state workers led Cowell to put the program on hold this year, said spokeswoman Kerra Bolton.

The decision follows a similar move last week by the N.C. Banking Commission, which held $200,000 in performance bonuses it had budgeted.

Bolton said that the bonus program helps the state compete with private sector firms for people to make investments., noting that 11 of the 13 largest public pension plans have similar programs.

"This is important because high-performing investment professionals increase the chances for above benchmark performance, save systems substantial sums in external management fees, and help to insure the prudent investment and oversight of public plan assets," she said in an e-mail to Dome.

Which bills Cowell is pushing

ryanteaguebeckwith — Fri, 01 May 2009 11:26:31 -0400

Janet Cowell may no longer be a senator, but she's still interested in legislation.

The Democratic state treasurer is lobbying for at least 11 bills in the General Assembly this session, most of which affect her office:

Investment Risk Reduction: Give treasurer's office more flexibility on types of investments for the state pension fund.

Stimulus Reconciliation: Authorizes state to issue different kinds of debt to take advantage of the federal stimulus package.

Treasurer Transparency: Expands treasurer's Investment Advisory Board and sets a standard for assessing decisions.

Property Protection: Limits amount that businesses or individuals can charge for retrieving property held in escheat by the state.

Public Campaign Financing: Expands public campaign finance program to include state treasurer among other offices.

Electronic Reporting: Requires banks and insurance companies reporting large amount of escheats to use state-approved software.

Data Sharing: Permits N.C. Department of Revenue to share certain tax information with the treasurer's office.

Energy Savings Contracts: Removes the cap on energy saving contracts, requires life-cycle cost analyses of conservation measures, among other things.

Pension Corrections: Makes technical corrections to the statutes covering the pension fund and similar state funds.

Retirement COLAs: Addresses cost-of-living adjustments for retirees under the state pension fund and judicial pension fund.

Fire and Rescue Pension: Increases the monthly payment for members of the Firemen's and Rescue Squad Workers Pension Fund.

Document(s):
cowell-2009-bills.pdf

State pension down $4b so far

ryanteaguebeckwith — Wed, 29 Apr 2009 08:46:23 -0400

North Carolina's pension lost about $4.1 billion in the first three months of 2009.

State Treasurer Janet Cowell said Tuesday that the negative 6.4 percent return, which left the pension fund valued at $55.9 billion, was about average.

About 41 percent of the funds are invested in stocks, another 47 percent in bonds, six percent in real estate and the remainder in other investments.

Cowell asked lawmakers to put $358 million into the system over the next two years to make up the losses, but a projected $3 billion budget deficit makes that unlikely. (WRAL)

The Senate Finance Committee, meantime, gave is approval to a bill that would expand the types of investments Cowell can make for the fund, allowing 10 percent more to go into nontraditional investments.

Cowell said that would reduce risk. (Insider)

Treasurer: Windex reform

markjohnson — Thu, 19 Mar 2009 17:32:28 -0400

State Treasurer Janet Cowell, who manages the state's $60 billion pension fund, announced Thursday several steps to provide greater transparency to how her office makes investment decisions. The measures include:

-- Creating a one-year cooling off period for employees who leave the treasurer's office, during which they cannot lobby or market services to the office.

-- Starting a request-for-proposal process for law firms that want to handle legal work for the Treasurer's office.

-- Adding more members with investment experience to the Investment Advisory Committee.

-- Posting quarterly reports on the department's Web site showing where money is invested and how it's performing.

-- Hiring an independent consultant to evaluate the ethics, oversight and decision-making of the investment practices.

Former State Treasurer Richard Moore ended up in a dispute with Attorney General Roy Cooper last year because Moore hired private law firms to represent the state in legal action instead of letting Cooper's office handle the work. One of the firms' partners was a major supporter and contributor to Moore's campaign for governor. Cooper's office said they encouraged Moore to set up a competitive process for hiring outside counsel.

"One of the many casualties of the current economic crisis is the erosion of public trust in government and financial institutions," Cowell said, adding that one route to repairing that loss is to let the public see where money is invested and how investment decisions are made.