By Paul Gable
The South Carolina public pension fund commission is looking for a large increase in its operating budget in the upcoming fiscal year.
Officially named the South Carolina Retirement System Investment Commission, the agency is proposing an increase in operating budget from today’s $10 million to $14 million. That is a 39 percent increase.
The proposed increases come two years after the agency’s budget increased by 74 percent, from $5.8 million in FY 2011 to $10.1 million for FY 2012.
Maybe such increases wouldn’t be so bad, although an over 100 percent budget increase is hard to justify anytime, if the agency was performing well. But, the most notable achievement of the SCRSIC in the past year has been to become deeply involved in political gamesmanship.
The commission’s current chairman, Reynolds Williams, is under investigation by SLED and the S.C. Ethics Commission for an investment deal with American Timberlands, LLC. Williams’ law firm worked on the deal before it was brought to the commission, an alleged violation of state law.
S.C. Treasurer Curtis Loftis has been a critic of the commission since taking office in January 2011. Loftis is the only elected official on the commission board and has had trouble getting information about the expenses of the commission.
On January 31, 2012, Loftis outlined problems associated with the pension fund during testimony to the Senate Finance Retirement Committee.
One day later, the Associated Press broke the story “Pay for Play scheme probed at state’s $25 billion retirement system”. The first paragraph said SLED had launched an investigation while the second paragraph read, “The investigation was started after at least two financial management firms said they were promised they could manage a piece of the retirement fund, earning lucrative fees, if they paid money to a friend of state Treasurer Curtis Loftis.”
The investigation totally exonerated Loftis, but demonstrated an apparent willingness of commission members to play dirty with anyone who questioned their actions.
The agency manages the approximately $25 billion in assets of the state’s public employees retirement system. However, it is estimated to currently have a shortfall of approximately $14 billion, over the next 30 years, in its assets vs. its obligations to pay retired public employees.
In addition to the fund shortfall, investment fees of the agency have increased tenfold over six years, from approximately $31 million in 2005 to $343 million in 2011.
Somebody’s getting rich from the SCRSIC, but it sure doesn’t seem to be the public employees to whom benefits will be paid.
Speak Up…