Tuesday's election resulted in three new state treasurers that have oversight of retirement programs in their states and the passage of amendments in three states that will have an effect on state pension funds.
Republican Dale Folwell won the election Tuesday to be North Carolina's next treasurer, a job that includes serving as sole trustee of the $87.6 billion North Carolina Retirement Systems, Raleigh.
Mr. Folwell, the first Republican state treasurer since 1876, defeated bond attorney Dan Blue III, a former Bear Stearns Cos. Inc. investment banker, with nearly 53% of the vote.
Mr. Folwell, a former forensic accountant with Alex. Brown, a division of Raymond James, campaigned on a promise of immediately reducing money manager fees by $100 million, through a combination of fee cuts, internal management and indexing. He also promised to scrutinize money managers' performance in relation to their fees.
In Oregon, Democratic state legislator Tobias Read is the next treasurer, whose office manages the state's finances and is a voting member of the Oregon Investment Council, Tigard, which runs the $68.3 billion Oregon Public Employees Retirement Fund, Salem. Mr. Read, who backed legislation creating the Oregon Retirement Savings Plan that will launch July 1, 2017, for private-sector workers without access to workplace plans, will now chair its board. Mr. Read also said during the campaign that he would consider borrowing from the state's operating funds to reduce a $22 billion funding gap in the state retirement systems.
Also in Oregon, a constitutional amendment approved by more than 70% of voters allows public state universities to invest some of their assets in equities, which are expected to be managed by the $775 million University of Oregon Foundation, Eugene.
Pennsylvania's next treasurer is Democrat Joe Torsella, who campaigned on the promise of creating the PA-IRA program for private-sector employees without access to workplace retirement plans. Mr. Torsella, a former deputy mayor of Philadelphia, opposes the use of placement agents for hiring money managers and called for fewer outside money managers by the $48.5 billion Pennsylvania Public School Employees' Retirement System and $26 billion Pennsylvania State Employees' Retirement System, both in Harrisburg, on whose boPennsylvania State Employees' Retirement System Pennsylvania State Employees' Retirement System, both in Harrisburg, on whose boards the treasurer sits.
Illinois' next comptroller is Democrat Susana Mendoza, a former state legislator and Chicago city clerk who faced criticism about pension “double dipping” from her opponent. Ms. Mendoza is aligned with Democratic House Speaker Mike Madigan, who disagrees with Republican Gov. Bruce Rauner over contributions to the state's five severely underfunded retirement systems that have $111 billion total in unfunded liabilities.
In Wyoming, voters agreed to amend the state constitution to allow all state investment pools to invest in equities, which the $7.4 billion Wyoming Retirement System, Cheyenne, and some other state funds already can do.
In Hawaii, voters narrowly approved by 50.1% a legislatively referred constitutional amendment that would allow excess general fund revenues, now only to be used for emergencies, to be applied to bond payments and shortfalls in the $14 billion Hawaii Employees' Retirement System, Honolulu.
In Louisiana, voters approved creation of a permanent fund that could be used to pay for shortfalls in the $9.9 billion Louisiana State Employees' Retirement System and the $16.6 billion Louisiana Teachers' Retirement System, both in Baton Rouge. The "Revenue Stabilization Trust Fund" would be used to finance construction projects and transportation infrastructure, and to accelerate payments to address pension underfunding, once taxes and mineral revenues above $600 million and $950 million, respeLouisiana Teachers' Retirement Systemillion Louisiana Teachers' Retirement System, both in Baton Rouge. The "Revenue Stabilization Trust Fund" would be used to finance construction projects and transportation infrastructure, and to accelerate payments to address pension underfunding, once taxes and mineral revenues above $600 million and $950 million, respectively, are reached.