Montesano Sponsors Legislation to Enact Greater Oversight of the State’s Retirement System

February 7, 2011

Assemblyman Michael A. Montesano (R,I,C-Glen Head) recently reintroduced legislation (A. 3164) which would create the Employee Retirement System Board of Trustees to operate the New York state and local employees' retirement system and the New York state and local police and fire retirement system. The board would enact an extra level of oversight to prevent fraud, increase the level of accountability and encourage transparency among investment groups.

“The problems facing New York’s retirement system are grave,” said Montesano. “Even with taxpayers being asked to contribute billions more to the retirement system, costs will have to be pushed off to the future and turned into ‘IOUs’. The costs are rising, the ability to cover future costs is rapidly decreasing and currently it is projected by the Empire Center that the New York State and Local Retirement Systems alone are $71 billion short of their pension obligations. We cannot afford to suffer any missteps or allow fraud any longer.”

Currently, the New York State Comptroller oversees the state’s massive common retirement fund that totals well over $100 billion. The Employee Retirement System Board would be exclusively dedicated to monitoring the retirement system and regulating firms doing business with the fund. The board would consist of five members with backgrounds in securities investment, pension administration, pension law, and governmental finance.

“New York’s public retirement system is too important to leave to one person or office to oversee its enormous fund,” said Montesano. “The board would add a group of experts whose sole purpose was to operate the fund and prevent fraud. For countless hardworking New Yorkers, the fund is their financial lifeline and for others, it is a valuable investment for their future. This legislation would benefit all New Yorkers by assuring the well-being and health of the retirement fund.”