The New Jersey Senate on Thursday approved a recently introduced piece of legislation that would tighten rules regarding political donations made by investment firms vying for business from the state’s pension funds.
The bill, called S-2430, passed by a vote of 25–8.
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The bill…would apply the same pay-to-play prohibitions on contributions to national political organizations by private investors that apply at the state level. It would also require more transparency by the State Investment Council, requiring the public disclosure of private money managers and the fees they receive for managing pension investments.
“This administration shouldn’t be playing politics with the public employees’ pensions,” said Senator Turner. “The fund is there for retired workers, not to be used as political currency. The investors should be selected on performance and merit, not because of campaign contributions, and the investments should be made for the best financial reasons.”
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The legislation would require the investment council to put in place a rule prohibiting firms it selects to invest pension funds from making contributions to any national political organization. New Jersey also does not require the regular disclosure of the fees paid to the private investment firms selected to manage pension funds.
The bill would require quarterly reports by the investment council detailing the investment returns of the private firms and the fees they receive. The report would have to be submitted to the governor, the Legislature and posted online to be made available to the public.
Senators Shirley Turner and Peter Barnes, who both sponsored the bill, commented on the legislation. Turner said:
“This administration shouldn’t be playing politics with the public employees’ pensions,” said Senator Turner. “The fund is there for retired workers, not to be used as political currency. The investors should be selected on performance and merit, not because of campaign contributions, and the investments should be made for the best financial reasons.”
And Barnes:
“The best thing to do is to remove even the appearance of any political influences when pension fund investments are made,” said Senator Barnes. “We want to make sure that everyone is confident that the best interests of retirees are being served. They earned it through their careers of hard work and contributions. ”