Connecticut House Bill HB05418

Connecticut 2016 Regular Session

• Introduced: 2/25/16
• Refer: 2/25/16

Caption

An Act Concerning Establishing The Anticipated Rate Of Return For Investments In State Retirement Plans.

Impact

If enacted, HB 5418 will amend Section 3-13b of the Connecticut General Statutes to enhance the governance of state retirement funds. This will involve a structured approach to how investment policies are developed and articulated by the state treasurer in conjunction with the Investment Advisory Council. The council will have the authority to approve investment policies, ensuring investments are aligned with state goals and the needs of beneficiaries. The legislation aims to create a defined structure that would provide better oversight and management of public pensions, potentially improving fiscal stability for retirement systems.

Summary

House Bill 5418 proposes the establishment of the anticipated rate of return for investments in state retirement plans. Under this bill, the Investment Advisory Council, which is responsible for overseeing the investments of state retirement funds, is mandated to set a defined rate that will influence how these funds are managed. The aim is to provide clarity and consistency in the management of the state’s investment portfolio, ensuring that actuarial analyses are conducted based on a stable and predictable rate of return.

Contention

While the bill aims to standardize and professionalize the management of state retirement funds, it may also face scrutiny regarding its efficacy and the potential impact on actual investment returns. Concerns might arise about the council's ability to accurately predict market conditions to set the anticipated rates, as fluctuations in the market can influence the returns on state investments. Stakeholders such as union representatives and pension advocates will likely debate the implications of these established rates on retirees' livelihoods and the health of state retirement systems in the long term.