[ad_1]
In the aftermath of an unsuccessful attempt to oust the two top executives from Pennsylvania’s largest pension fund, the pension board remains deeply divided, as shown in a new public statement from a board member who backed the leadership of the fund for a long time.
Eric DiTullio, a suburban Pittsburgh construction estimator and one of two school board representatives on the 15-member panel, lambasted the dissidents, complaining that they had publicly attacked the fund’s leadership without first take their case to their colleagues on the board.
Some members, DiTullio wrote in a letter last week to 4,500 local school board members, engaged in political maneuvering to get what they wanted instead of open and honest communication and discussion-based discussions. facts.
During a fierce behind-the-scenes campaign earlier this month, six dissidents on the board tried unsuccessfully to secure the two additional votes needed to fire PSERS executive director Glen Grell and chief of staff. investments, James H. Grossman Jr.
They issued a detailed critical letter ahead of what the group had hoped would be a board vote to oust them. Ultimately, the dissident bloc did not call for a vote, acknowledging it lacked the votes to win.
The six critics claim that Grell and Grossman had pursued a high-cost, low-return investment strategy that caused the plan’s performance to decline and hurt 500,000 active teachers and retirees whose pensions are guaranteed by the plan. They said the fund would be worth billions more if it had simply achieved the same investment results as many other public pension plans.
But DiTullio dismissed this criticism, saying it was largely factual, but not provided in context or truthful. He said the planning leadership has consistently met its own benchmarks for returns on investment.
A state pension reform commission in 2019 ranked the PSERS at the bottom of the performance ladder for state investments over the previous decade and criticized the scheme or used internal measures instead of standing down. compare to similar diets elsewhere.
In his letter, obtained by The Inquirer, DiTullio also defended the distancing of PSERS from US stocks, a step he took after the decade-long Great Recession that drastically depressed stock prices. This hurt fund returns as stocks once again outperformed other investments, but DiTullio said it was a smart attempt to find stable and lower (but safer) returns, for growth. long-term. He noted that previous board members had endorsed this decision.
The dissident letter was signed by State Treasurer Stacy Garrity and posted on her agency’s letterhead. A Garrity aide declined to comment on DiTullios’ statements.
DiTullio did not name the members he criticized. In this case, besides Garrity, another of the six was the other representative of the school boards on the panel, Nathan Mains III.
As part of the complex PSERS board selection system, Mains holds his ex officio seat, due to his role as CEO of the Pennsylvania School Boards Association. DiTullio, for his part, was re-elected to the PSERS in January, winning 234-214, in an election open only to school board members in which the turnout was only 10%. The main association supported the opponent of DiTullios.
While DiTullio said he wrote his letter to set the record straight, his letters distorted key facts about the issues PSERS is facing, including about the FBI’s investigation into the fund that has surfaced. in spring.
In the letter, he informed his fellow school board members that there was no connection between the FBI investigation and the boards’ adoption last year of an incorrect and exaggerated figure for student performance. fund investments. In April, the panel admitted that the number was wrong
In fact, as the Inquirer reported, FBI agents served pension executives with grand jury subpoenas in March, requesting all PSERS tapes related to this flawed calculation. The mathematical error forced a politically embarrassing increase in the pension contributions of 100,000 school workers.
When asked in an interview how this matched his statement, the investigation and the calculation were unrelated, DiTullio admitted that I had not seen the summons.
In his letter, DiTullio suggested that part of the federal investigation could go beyond what has already been reported.
The subpoenas said federal authorities were also investigating the agency’s purchase of properties in Harrisburg, purchases that began in 2017. But DiTullio told school board members the investigation was investigating property acquired by the fund going back to 2015.
That year, PSERS staff reversed an old policy and began buying orchards, apartments, a chain of trailer parks and other properties directly, instead of going through Wall’s investment managers. Street.
When asked if he had been told that investigators were verifying transactions other than the Harrisburg acquisitions, DiTullio objected. It could be, he said, but I don’t know for sure.
[ad_2]
picture credit