I applaud the State Employee's Association of North Carolina (SEANC) for hiring a pension and legal professional to investigate the North Carolina Retirement System (NCRS). You can read the SEANC press release by clicking here or the Charlotte Observer article by clicking here.
Slowly but surely, more and more people are beginning to pay attention to one of North Carolina's greatest assets - the $83 Billion pot of money solely controlled by North Carolina's elected State Treasurer. As the treasurer essentially reports to "the people," the treasurer in practice, reports to no one. North Carolinian's probably don't realize the immense power the State Treasurer has as the sole-trustee of North Carolina's $83 Billion pension fund. The sole-trustee set up is rare for this country as North Carolina is one of only 4 states with this structure. No other elected politician in North Carolina controls this amount of money with virtually no checks and balances.
While North Carolina has a very competent State Auditor in Beth Wood (a CPA), she has far too much on her plate to be able to give the attention required to fully understand the intricate web of details of a multi-billion dollar pension fund with increasingly complicated investments managed by over 200 external managers scattered globally. And, does anyone really believe the State Legislature as a body is adequately monitoring the Treasurer's office?
The only certain way to make sure the Treasurer's Office is not monitored, is to leave it up to 170 part-time political legislators paid a paltry $13,951 a year or 10 million people of the general public. Until SEANC recently began asking tough questions about the pension fund, I could count the number of people paying attention to the investments managed by the Treasurer's office on one hand. Thus, SEANC is right to commission this investigation. I applaud Dana Cope and Ardis Watkins at SEANC for funding this long overdue peek into the Treasurer's Office. Even if the investigation finds everything to be hunky-dory within the Treasurer's Office, I believe it is money well spent just for the peace of mind it will create.
In fact, just by announcing the investigation, SEANC has already had a positive impact. The Treasurer's three missing quarterly "Government Investment Operations Reports" that had not been publicly disclosed for over a year, magically appeared on the Treasurer's website just hours after the SEANC announcement. As this report includes the ONLY disclosure of expenses and fees incurred by the NCRS pension fund (albeit only one page), the cost of the investigation has already paid for itself. It's truly amazing the speed of action exhibited by our public officials once a bright light shines on their actions - or inaction.
Anyone who has a problem with SEANC hiring an investigator needs to realize that the $83 Billion pot of money belongs to the North Carolina Teachers, State, and Municipal Employees. The vast majority of the money in that pot comes from the 6% automatic deduction that comes out of EVERY PAYCHECK our civil servants earn. It completely makes sense for the STATE EMPLOYEES Association to step up and fund such an investigation.
Treasurer Janet Cowell should welcome the investigation with open doors and open drawers. After all, as a publicly elected official, she and her department should have nothing to hide, right?