Commission OKs new state pension policy

PROVIDENCE – The R.I. State Investment Commission has adopted a new policy allowing for some of the state’s pension funds to be placed in investments intended to retain or create jobs in the state.
The new policy allows up to 2 percent – or $135 million – of total pension funds under management to be dedicated to targeted investments. There will also be guidelines to evaluate risk and return when it comes to these types of investments – called Economically Targeted Investments, or ETIs, officials said.
“It’s important that we have the option to attract and invest in funds which will create jobs and stimulate the local economy,” R.I. General Treasurer Frank T. Caprio, chairman of the investment commission, said in a statement.
The commission is authorized to invest in a variety of asset classes that produce returns comparable to other non-targeted investments while providing auxiliary economic benefits to the state.
Still, the commission’s legal and fiduciary duties take precedence. An ETI will be undertaken only when proven to provide returns at least equivalent to other available investments, at comparable amounts of risk.
The commission is required to produce an annual report to the Secretary of State’s office and the General Assembly, detailing the results of the investments.
“Our overriding obligation at the SIC is to maximize the value of our pension funds,” said Caprio, who is running for governor in November. “If we can achieve this goal and at the same time make investments which create jobs and improve the local economy, it’s a win-win for all Rhode Islanders.”