Gov. Ducey finally filling $36 billion retirement system's boardPosted: Updated:
Arizona Gov. Doug Ducey is finally moving to fill vacancies on the board overseeing the $36 billion retirement fund covering most state, city and county workers that had left it unable to do any substantive work since November.
Ducey made eight nominations. Six of the new people nominated and one re-nomination were approved by the Arizona Senate Finance Committee on Monday. Because three members of the board are leaving, however, there will still be two vacancies.
The board had only four members since November and lacked a quorum to conduct business. That meant the panel was unable to sign off on major investment changes if managers believe they are warranted or approve other legally-required items.
Board member Dennis Hoffman last month called the vacancies imprudent and "arguably irresponsible." The Arizona State University economist is not being re-nominated and said in a statement that he was pleased to serve for five years, thankful for the opportunity and happy to have someone else serve.
The Senate Finance Committee held confirmation hearings on the seven nominees Monday and forwarded them to the full Senate for formal confirmation.
The lack of a functioning board prevented normal oversight of investment planning and operations, although fund Director Paul Matson said in an interview last month that much of the day-to-day operation of the fund is already delegated to him, and said he could even make changes to allocation goals requiring board approval if a consensus of the sitting members agreed.
The emptying of the board happened in the last year. Two new members were appointed in 2015, but never confirmed by the Senate and by law left after a year. Three others were reappointed but were not confirmed by the Senate and left by November.
Ducey did not act to replace them until The Associated Press published a story about the issue last month.
The new nominees approved by the Finance Committee are Clark Partridge, Harry Papp, James Hillyard, Rene Guillen, Kevin McCarthy and Michael Miller. Tom Manos was reappointed and approved, while one nominee, Michael Lofton, didn't receive a hearing Monday.
The board oversees investments that fund pensions for nearly 575,000 current and former state and local employees, including teachers and university workers. It sets investment policy and allocation goals, approves audits and oversees Matson.
Police, corrections officers and elected officials have a separate plan.
Questioned about the vacancies last month, Ducey spokesman Daniel Scarpinato could not explain why the board was allowed to drop to four, but said the governor is not intentionally leaving the board short-handed.
"The governor takes the appointments to this board very, very seriously," Scarpinato said. "Especially with his background as state treasurer, he very much believes that having the right people in place there is critical."
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