New Mexico Gov. Bill Richardson signed a bill removing investment restrictions for the state's three public pension funds, paving the way for the funds to add alternative investments. The bill, signed April 6, eliminates the so-called "legal list" of permissible investments for the $11.5 billion New Mexico State Investment Council, $10.1 billion New Mexico Public Employees Retirement Association and $6.7 billion New Mexico Educational Retirement Board, all in Santa Fe, and replaces it with guiding principles of the Uniform Prudent Investor Act. The bill also requires the three funds to report quarterly to the state on investment performance and annually on any changes in written investment policies.
Separately, Mr. Richardson on April 7 signed a bill that will gradually increase the employer contribution of the Educational Retirement Board to 9.4% on July 1, 2006 and 11.65% in 2008, from 8.65% now. Also passed this session is a joint memorandum by the state Legislature to study whether the Educational Retirement Board should create a defined contribution plan or convert to a hybrid plan. Another joint memorandum extends the authority of an existing state task force that's studying the possibility of creating a statewide defined contribution plan. Neither bill requires the governor's signature.