Tag: Andrew Cuomo

New York Gov. Seeks to Retroactively Strip Pensions From Public Officials Convicted of Felonies

Andrew Cuomo

The arrest of New York Assembly Speaker Sheldon Silver last month left a bitter taste in the mouths of many in the New York legislature.

The arrest came at an ironic time, just as Gov. Andrew Cuomo was rolling out a series of ethics proposals aimed at lawmakers.

Now, Cuomo has added another bullet point to his ethics reform wish list: retroactively stripping pensions from public officials convicted of felonies.

A 2011 law – the Public Integrity Reform Act – already takes away pensions from officials who have been convicted of felonies in relation to their public duties. But the law only affects those who were convicted after 2011.

Cuomo wants to extend the law to retroactively include officials convicted before the law was passed.

More from the Times-Union:

The proposed change, part of the governor’s five-point ethics ultimatum, would retroactively extend the effects of a 2011 law that allowed for the denial of pensions from public officials who entered the system going forward. Because of the need for a constitutional change to affect those already in the system, an entire rogues’ gallery of corrupt pols […] who faced trial after the law was passed continue to receive sizable public pensions despite being convicted of stealing from the same trough or using their positions to enrich themselves in other ways.

“Public officials who are convicted of public corruption should not have taxpayers pay for their retirement,” Cuomo said two weeks ago in a speech at New York University Law School, where he laid out the reform items he wants to see included in the state budget package. That plan has to be hammered out with legislative leaders before the April 1 start of the new fiscal year.

[…]

The 2011 Public Integrity Reform Act said that the pensions of a wide swath of public officials and employees — including the governor and lawmakers as well as state agency and municipal workers — could be taken away following conviction on a defined set of felonies, including larceny from public sources and using official powers in an attempt to defraud someone. But because of the ’38 amendment, the law could only affect those joining the pension system after the law went into effect.

The proposal could be hard to enact because it will require a constitutional amendment – which is no easy feat.

The proposal will have to be passed by both chambers of the New York legislature. Then, it will need to be passed again by both chambers in 2017.

After that, the measure will be put on the ballot and voted on by state citizens. If it passes the state-wide vote, then the measure will become law.

 

Photo credit: Andrew Cuomo by Pat Arnow.jpeg: Pat Arnow derivative work: UpstateNYer (Andrew Cuomo by Pat Arnow.jpeg) [CC BY-SA 2.0 (http://creativecommons.org/licenses/by-sa/2.0)], via Wikimedia Commons

Video: New York Gov. Draws Flak For Teacher Pension Comment

New York Gov. Andrew Cuomo has upset some teachers and their unions after a comment last week about schools being more concerned about keeping pensions intact than improving schools.

The comment in question:

“We’ve sent thousands of children to schools we knew were failing from an educational point of view. Albany has been too concerned with protecting the pension rights of teachers and not concerned enough with the future of students.”

The above video discusses Cuomo’s comment and why he may have said it.

 

Feature photo credit: Andrew Cuomo by Pat Arnow.jpeg: Pat Arnow derivative work: UpstateNYer (Andrew Cuomo by Pat Arnow.jpeg) [CC BY-SA 2.0 (http://creativecommons.org/licenses/by-sa/2.0)], via Wikimedia Commons

Cuomo Rejects Bill To Increase Alternative Investments By Pensions

Manhattan

New York Governor Andrew Cuomo on Thursday vetoed a bill that aimed to raise the percentage of assets New York City and state pension funds could allocate towards hedge funds and private equity.

From Bloomberg:

Governor Andrew Cuomo vetoed a bill that would have allowed New York state, city and teachers pension funds to allocate a larger percentage of their investments to hedge funds, private equity and international bonds.

The measure approved by lawmakers in June would have increased the cap on such investments to 30 percent from 25 percent for New York City’s five retirement plans, the fund for state and local workers outside the city, and the teachers pension. The funds have combined assets valued at $445 billion.

“The existing statutory limits on the investment of public pension funds are carefully designed to achieve the appropriate balance between promoting growth and limiting risk,” Cuomo said in a message attached to the veto. “This bill would undermine that balance by potentially exposing hard-earned pension savings to the increased risk and higher fees frequently associated with the class of investment assets permissible under this bill.”

[…]

A memo attached to the New York bill said raising the allotment for hedge funds and other investments is necessary for flexibility to meet targeted annual returns. A swing in the value of the funds’ publicly traded stocks can push the pensions “dangerously close” to the investment cap, the memo said. The change would also better enable the funds’ advisers and trustees to “tactically manage the investments to take advantage of market trends, react to market shocks and potentially costly rebalances or unwinds at inopportune times,” it said.

New York City Comptroller Scott Stringer supported the bill.

 

Photo by Tim (Timothy) Pearce via Flickr CC License

New York City Council Members Urge State Lawmakers to Overturn Governor’s Veto of Veteran Pension Bill

New York City

Last month, New York Governor Andrew Cuomo vetoed a bill that would have granted certain war veterans a “jump-start” toward drawing a state pension.

Some members of New York’s City Council are calling on state lawmakers to overturn that veto.

From the Queens Chronicle:

Members of the City Council’s Veterans Committee are urging state lawmakers to overturn Gov. Cuomo’s veto of a bill that would allow veterans who served during peacetime or undesignated conflicts to purchase up to three years of credit toward a state pension plan.

“We firmly believe that all military service is public service and therefore all honorably discharged veterans deserve access to the additional retirement credits this bill would afford,” a written statement by the members of the committee states.

The committee on Nov. 20 wrote to both Senate Majority Leader Dean Skelos (R-Nassau) and Assembly Speaker Sheldon Silver (D-Manhattan), urging the two to direct their respective houses to vote in a special session of the state Legislature to override the veto of the governor.

Councilman Eric Ulrich (R-Ozone Park), chairman of the Veterans Committee, said the two leaders should “not allow Gov. Cuomo’s veto to essentially close the door on helping thousands of veterans who deserve the help the most.”

Cuomo’s thoughts on the bill:

Cuomo on Nov. 7 vetoed the bill, stating that it would “run rough-shod over systemic reforms carefully negotiated with the Legislature to avoid saddling local property taxpayers with additional, unmanageable burdens.”

“It is disheartening to see the Legislature reverse course only two years after it overwhelmingly agreed to avoid tossing these burdens onto local taxpayers in cities, towns, counties and school districts,” Cuomo added.

“But the Legislature has chosen to ignore its commitment to shield property taxpayers from the costs of the new statewide pension enhancements.”

The estimated first-year cost to city employers would be about $18 million, according to the bill.

Implications for Pension Investments As Elections Put Ex-Financial Firm Executives in Office

voting sign

The results of several state-level elections could have implications for pension fund investments as three ex-financial firm executives became their states’ respective governors.

David Sirota writes:

Wall Street firms and executives have poured campaign contributions into states that have embraced the strategy, eager for expanded opportunities. Tuesday’s results affirmed that this money was well spent: More public pension money will now likely be entrusted to the financial services industry.

In Illinois, Democratic incumbent Pat Quinn was defeated by Republican challenger Bruce Rauner, who made his fortune as one of the namesakes of Golder, Thoma, Cressey & Rauner (GTCR) – a financial firm that manages more than $40 million of the state’s $50 billion pension system. Rauner — who retains an ownership stake in at least 15 separate GTCR entities, according to his financial disclosure forms— will now be fully in charge of the pension system.

In Rhode Island, venture capitalist Gina Raimondo, a Democrat, defeated Republican Allan Fung. Raimondo retains an ownership stake in a firm that manages funds from Rhode Island’s $7 billion pension system. Raimondo’s campaign received hundreds of thousands of dollars from financial industry donors. She was also aided by six-figure PAC donations from former Enron trader John Arnold, who has waged a national campaign to slash workers’ pensions. Fung slammed Raimondo as a tool of Wall Street, but she eked out a victory after a libertarian-leaning third party candidate, Robert Healy, unexpectedly siphoned votes away from Fung.

In New York, Gov. Andrew Cuomo, a Democrat, handily defeated his Republican opponent, Rob Astorino, after raising millions of dollars from the finance industry. The New York legislature is set to send Cuomo a bill that would permit the New York state and city pension funds to move an additional $7 billion into hedge funds, private equity, venture capital, real estate and other high-fee “alternative” investments. Assuming the standard 1 to 2 percent management fees applies, that could generate between $70 million and $150 million a year in fresh fees for Wall Street firms.

Cuomo has not taken a public position on the bill, but his party in the legislature passed it by a wide margin, and he is widely expected to sign it into law.

In Massachusetts, Republican Charlie Baker appeared early Wednesday to have secured a narrow victory over Massachusetts Attorney General Martha Coakley. Baker was a board member of mutual funds managed by a financial firm that also manages funds from Massachusetts’ $53 billion pension system. Baker is also the subject of a New Jersey investigation over his $10,000 contribution to the New Jersey State Republican Party just months before New Jersey Gov. Chris Christie’s officials awarded his firm a state pension deal. Christie, whose Republican Governors Association spent heavily to support Baker’s campaign, blocked the release of documents related to that investigation until after the election.

Read the full analysis here.

 

Photo by Keith Ivey via Flickr CC License