PROVIDENCE, R.I. – General Treasurer Gina M. Raimondo today addressed the State Investment Commission during their regular monthly meeting regarding the report the American Federation of State, County and Municipal Employees recently paid for to criticize her and pension reform.
"I entered public service to help our state, not to enrich myself. When I came into office the pension system was in crisis. My job is to stand up for all Rhode Islanders, and I am proud of how we came together to solve a problem to move us all forward," Raimondo said. "These false personal and political attacks are red herrings intended to undermine pension reform."
This political propaganda piece aimed at discrediting the Treasurer and the state's pension reforms is filled with innuendo and inaccuracies including:
- Treasurer Raimondo was not in office when the decision was made to invest in Point Judith Capital (PJC), her old company. The Treasurer received an opinion from the Ethics Commission regarding PJC and has a policy to recuse herself from all votes relating to the investment.
- Rhode Island is a national leader regarding transparency and disclosure of its investments and fees.
- Rhode Island's portfolio allocation to alternative assets is not an outlier when compared to other public pension plan portfolios. Since 1982, Rhode Island has invested in alternatives, including private equity. Research shows public pension plans have invested an average of 25 percent of their portfolios in alternatives. Rhode Island, with 24 percent of our state pension portfolio in alternatives, is on par with the best practices of large institutional investors, such as pension funds, university endowments and foundations.
The City of Providence, the state's second largest public pension fund, has also suspended cost-of-living-adjustments, has a higher percentage of its pension fund invested in hedge funds and publishes less information than the state about the fees, investment portfolio, and investment commission actions.
It is important to remember:
- The treasurer fought to always keep a defined benefit pension, and respected collective bargaining
- Reform passed overwhelmingly in a Democrat-controlled General Assembly
- There were countless hours of labor-attended pension advisory group meetings, legislative hearings and town hall-style meetings with the Treasurer and Governor
- All but one vote to approve the hedge funds were unanimous. The only vote to approve hedge funds that was not unanimous was due to one abstention – again, showing strong SIC support to execute this investment strategy