ALBANY—The state's pension fund lost over a quarter of its value during the last fiscal year, Comptroller Tom DiNapoli just announced.
The total balance of the fund declined from $153.9 billion to $109.9 billion as of March 31, meaning state and local governments have to contribute more to the fund. Currently, they pay in 7.4 percent of their payroll; DiNapoli said that will likely rise to the "ballpark" of 11 percent by 2011. He is proposing legislation that will allow local governments to soften the blow for taxpayers.
"Our diversification and long-term investment strategies helped New York weather the storm better than most," DiNapoli said at a Manhattan press conference that I listened to by phone. The pension system, he stressed, remains fully funded.
DiNapoli was asked what contribution, if any, the use of politically connected firms had in the drop. Attorney General Andrew Cuomo has been probing the state pension fund, and indicted two top aides to former Comptroller Alan Hevesi for engaging in a pay-to-play scheme.
DiNapoli declined to state specific figures, noting the ongoing investigation, and insisted, "I don't think you'll get as black-and -white a clarification as your question might suggest."
"In a year like this it's hard to know what 'par' is," he said.
Pushed on the point, DiNapoli admitted that he was not under orders from either Cuomo or the S.E.C. to not release the information. "There's been, certainly on our part, a deference in terms of finding and releasing information," he said. "To protect the interests of the fund, we are going through a great deal of analysis and judgment, and that's the guidance we've received."
This means no one has yet put a dollar amount on what the relationships with politically connected firms has cost taxpayers and pensioners.
DiNapoli did note that some legal action seeking damages from firms connected with the investigation has been taken, and said, "We need to protect the interest of our fund; that might be a possibility."
Finally, DiNapoli was also asked if he would adopt a code of conduct drafted by Cuomo to prevent abuse of the system.
"We're there, though the words might not be exactly the same," he said. "Look at our policies and procedures. That's our code of conduct."
This is a change from last week, when DiNapoli told me he was reviewing Cuomo's recommendations.