Press Release: State Investments Are Key to Main Street’s Recovery
For Immediate Release
May 29, 2020
Donald McFarland | 651-236-0494
Saint Paul, MN - “The COVID-19 pandemic reveals how invaluable our public employees are to keeping our society functioning and safe,” said State Auditor Julie Blaha. “Today, we on the Minnesota State Board of Investment took action to protect the dignity in retirement our public employees deserve. Our actions help provide the protection, diversification, and liquidity their pension funds need to weather the pandemic.”
The Minnesota State Board of Investment, which is made up of State Auditor Julie Blaha, Secretary of State Steve Simon, Attorney General Keith Ellison, and Governor Tim Walz, passed two resolutions to protect Minnesota’s public pension funds. The resolutions concern management of the pension funds’ asset allocation and liquidity, and reducing investments in thermal coal production. Auditor Blaha voted yes on both resolutions.
“Not only do today’s actions enable our staff to better manage the risk in our portfolio, but they have larger community benefits as well,” Blaha continued.
The Office of the State Auditor focuses almost entirely on local government. Auditor Blaha sees a clear connection between strong pensions and strong local communities. “In a time when local governments are rocked by the economic impact of the virus, it is essential that we pay pension benefits fully and on time,” Blaha added. “Besides fulfilling promises made to public employees, pension funds find their way to every Main Street in Minnesota.”
In 2018 for instance, $4.4 billion was paid out in benefits to nearly 200,000 retired public employees, 88% of whom live all across Minnesota. The Minnesota State Retirement System illustrates how the benefits are spread to every corner of the state here: https://minnesotatra.org/wp-content/uploads/2019/03/2019-Pension-Plan-of-MN-Legislative-District-Map.pdf
In addition, the resolution that increases liquidity to pay benefits will allow us to direct more assets toward distressed parts of the economy. Shoring up those segments can help improve the United States’ overall economic health. The resolution that reduces investments in thermal coal companies protects the fund from their declining market values and the risks of stranded assets that arise as demand for more cost effective, efficient, and climate friendly forms of energy production grow.
The Office of the State Auditor is the constitutional office that oversees nearly $40 billion in local government finances for Minnesota taxpayers. The Office of the State Auditor helps to ensure financial integrity and accountability in local government financial activities. Julie Blaha is Minnesota’s 19th State Auditor. Follow us on Twitter @MNStateAuditor.