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General Assembly Raised Bill No. 1557
January Session, 2025
LCO No. 7064
Referred to Committee on FINANCE, REVENUE AND
BONDING
Introduced by:
(FIN)
AN ACT ESTABLISHING THE INVESTMENT BOARD AND
CONCERNING INDEPENDENT REVIEW OF THE INVESTMENT
PERFORMANCE OF THE STATE'S PENSION FUNDS.
Be it enacted by the Senate and House of Representatives in General
Assembly convened:
Section 1. Section 3-12a of the general statutes is repealed and the 1
following is substituted in lieu thereof (Effective July 1, 2027): 2
In addition to the appointments [authorized] by the Investment 3
Board under section 3-13a, as amended by this act, the Treasurer may 4
appoint, as the Treasurer determines is necessary, officers and other 5
investment-related personnel in [other] divisions of the office of the 6
Treasurer other than the investment department, with the approval of 7
the Commissioner of Administrative Services and the Secretary of the 8
Office of Policy and Management. [Such officers and investment-related 9
personnel shall serve at the pleasure of the Treasurer.] 10
Sec. 2. Section 3-13a of the general statutes is repealed and the 11
following is substituted in lieu thereof (Effective July 1, 2027): 12
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(a) (1) The [Treasurer, with the advice and consent of the Investment 13
Advisory Council] Investment Board established pursuant to subsection 14
(b) of section 3-13b, as amended by this act, shall appoint a chief 15
investment officer and may appoint a deputy chief investment officer, 16
principal investment officers, investment officers and other personnel to 17
assist the chief investment officer, for the Connecticut retirement 18
pension and trust funds, who shall serve at the pleasure of the 19
[Treasurer] board and whose compensation shall be determined by the 20
[Treasurer] board within salary ranges established by the [Treasurer in 21
consultation with the Investment Advisory Council] board. The 22
provisions of section 4-40 shall not apply to the compensation of such 23
officers and personnel. 24
(2) Any chief investment officer, deputy chief investment officer, 25
principal investment officer or other personnel who was appointed 26
pursuant to subdivision (1) of this subsection prior to July 1, 2027, shall 27
serve until the Investment Board appoints a successor or reappoints any 28
such officer or personnel. 29
(3) The chief investment officer shall be sworn to the faithful 30
discharge of duties under law and shall, under the direction of the 31
[Treasurer] Investment Board and subject to the provisions of sections 32
3-13 to 3-13d, inclusive, as amended by this act, and 3-31b, advise the 33
[Treasurer] board on investing the trust funds of the state. The chief 34
investment officer shall also perform such other duties as the [Treasurer] 35
board may direct. 36
(b) The [Treasurer] Investment Board may retain professional 37
investment counsel to evaluate and recommend to the [Treasurer] board 38
changes in the portfolio of the state's trust and other funds. Such counsel 39
shall inform the [Treasurer] board of suitable investment opportunities 40
and shall investigate the investment merit of any security or group of 41
securities. 42
(c) The cost of operating the investment department including the 43
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cost of personnel and professional investment counsel retained under 44
sections 3-13 to 3-13d, inclusive, as amended by this act, and 3-31b shall 45
be paid by the Treasurer charging the income derived from the trust 46
funds. 47
Sec. 3. Section 3-13b of the general statutes is repealed and the 48
following is substituted in lieu thereof (Effective July 1, 2027): 49
(a) (1) There is created an Investment Advisory Council that shall 50
consist of the following: 51
(A) The Secretary of the Office of Policy and Management who shall 52
serve as an ex-officio member of said council; 53
(B) The Treasurer who shall serve as an ex-officio member of said 54
council; 55
(C) (i) Five public members, all of whom shall be experienced in 56
matters relating to investments. The Governor, the president pro 57
tempore of the Senate, the Senate minority leader, the speaker of the 58
House of Representatives and the minority leader of the House of 59
Representatives shall each appoint one such public member to serve for 60
a term of four years. The appointing authority shall fill all vacancies of 61
the public members; 62
(ii) Such public members shall recuse themselves from discussions or 63
votes related to any direct or indirect contract with such public member 64
or such member's business organization or affiliate for the provision of 65
any services for the investment of trust funds of the state; 66
(D) Three representatives of the teachers' unions, and two 67
representatives of the state employees' unions. On or before July 15, 68
1983, the teachers' unions shall jointly submit to the Treasurer a list of 69
three nominees, and the state employees' unions or a majority thereof 70
who represent a majority of state employees shall jointly submit to the 71
Treasurer a list of two nominees. On or before July 30, 1983, the 72
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Governor shall appoint five members of the council from such lists, for 73
terms of two years. Any person appointed to fill a vacancy or to be a 74
new member at the expiration of a given term, whose predecessor in 75
that position was either a representative of one of the teachers' unions 76
or one of the state employees' unions, shall also be a representative of 77
such respective union group. Any such appointee shall be appointed by 78
the Governor from a list of nominees submitted to the Treasurer by the 79
teachers' unions or state employees' unions or such majority thereof, as 80
the case may be, within thirty days of notification by the Treasurer of 81
the existence of a vacancy or a prospective vacancy, or the expiration or 82
prospective expiration of a term. 83
(2) All members of the council shall serve until their respective 84
successors are appointed and have qualified. No public member of the 85
council shall serve more than two consecutive terms. 86
[(b)] (3) The Governor shall designate one of the members to be 87
chairperson of the council to serve as such at the Governor's pleasure. 88
The Treasurer shall serve as secretary of said council. A majority of the 89
members of the council then in office shall constitute a quorum for the 90
transaction of any business, and action shall be by the vote of a majority 91
of the members present at a meeting. Votes by members on investment 92
policies shall be recorded in the minutes of each meeting. Members of 93
said council shall not be compensated for their services but shall be 94
reimbursed for all necessary expenses incurred in the performance of 95
their duties as members of said council. The council shall meet at least 96
once during each calendar quarter and at such other times as the 97
chairperson deems necessary or upon the request of a majority of the 98
members in office. Special meetings shall be held at the request of such 99
majority after notice in accordance with the provisions of section 1-225. 100
Any member who fails to attend three consecutive meetings or who fails 101
to attend fifty per cent of all meetings held during any calendar year 102
shall be deemed to have resigned from office. 103
(b) (1) On and after July 1, 2027, the Investment Board shall be a 104
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successor agency to the Investment Advisory Council. The term of each 105
public member and union representative in office on June 30, 2026, shall 106
end on July 1, 2027. The Investment Board shall consist of the following: 107
(A) The Governor who shall serve as an ex-officio member of the 108
board, or the Governor's designee; 109
(B) The Treasurer who shall serve as an ex-officio member of the 110
board; 111
(C) (i) Five public members, all of whom are experienced in matters 112
relating to investments, appointed by the Governor with the advice and 113
consent of the General Assembly; 114
(ii) Such public members shall recuse themselves from discussions or 115
votes related to any direct or indirect contract with such public member 116
or such member's business organization or affiliate for the provision of 117
any services for the investment of trust funds of the state; 118
(D) Three representatives of the teachers' unions, who shall be 119
appointed by the Governor from a list of nominees submitted by the 120
teachers' unions or a majority thereof that represents a majority of 121
teachers; and 122
(E) Two representatives of the state employees' unions, who shall be 123
appointed by the Governor from a list of nominees submitted by the 124
state employees' unions or a majority thereof that represents a majority 125
of state employees. 126
(2) Each member appointed under subparagraphs ( C) to (E), 127
inclusive, of subdivision (1) of this subsection shall serve a term of four 128
years. The Governor shall fill any vacancy for the unexpired term of a 129
member appointed under subparagraph (C) of subdivision (1) of this 130
subsection. The Governor shall fill any vacancy for the unexpired term 131
of a member appointed under subparagraph (D) or (E) of subdivision 132
(1) of this subsection from a new list of nominees submitted by the 133
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applicable unions. 134
(3) The Treasurer shall serve as chairperson of the Investment Board. 135
A majority of the members of the board then in office shall constitute a 136
quorum for the transaction of any business and action shall be by the 137
vote of a majority of the members present at a meeting. Votes by 138
members on investment policies shall be recorded in the minutes of each 139
meeting. Members of the board shall not be compensated for their 140
services but shall be reimbursed for all necessary expenses incurred in 141
the performance of their duties as members of the board. The board shall 142
meet at least once during each calendar quarter and at such other times 143
as the chairperson deems necessary or upon the request of a majority of 144
the members in office. Special meetings shall be held at the request of 145
such majority after notice in accordance with the provisions of section 146
1-225. Any member who fails to attend three consecutive meetings or 147
who fails to attend fifty per cent of all meetings held during any 148
calendar year shall be deemed to have resigned from office. 149
(c) (1) The [Treasurer] Investment Board shall recommend [to the 150
Investment Advisory Council] an investment policy statement that 151
[shall set] sets forth the standards governing investment of trust funds 152
by the Treasurer, which are determined by the board to be in the best 153
interest of the state. Such statement shall include, with respect to each 154
trust fund, without limitation, (A) investment objectives; (B) asset 155
allocation policy and risk tolerance; (C) asset class definitions, including 156
specific types of permissible investments within each asset class and any 157
specific limitations or other considerations governing the investment of 158
any funds; (D) investment manager guidelines; (E) investment 159
performance evaluation guidelines; (F) guidelines for the selection and 160
termination of providers of investment-related services who shall 161
include, but not be limited to, investment advisors, external money 162
managers, investment consultants, custodians, broker-dealers, legal 163
counsel, and similar investment industry professionals; and (G) proxy 164
voting guidelines. A draft of the statement shall be [submitted to the 165
Investment Advisory Council at a meeting of said council and shall be] 166
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made available to the public [. Notice of such availability shall be 167
published in at least one newspaper having a general circulation in each 168
municipality in the state which publication shall be not less than two 169
weeks prior to such meeting. Said council shall review the draft 170
statement and shall publish any recommendations it may have for 171
changes to such statement in the manner provided for publication of the 172
statement by the Treasurer. The Treasurer shall thereafter adopt the 173
statement, including any such changes the Treasurer deems 174
appropriate, with the approval of a majority of the members appointed 175
to said council. If a majority of the members appointed to said council 176
fail to approve such statement, such majority shall provide the reasons 177
for its failure to approve to the Treasurer who may submit an amended 178
proposed statement at a subsequent regular or special meeting of said 179
council. Such revised proposed statement shall be made available to the 180
public in accordance with the provisions of the Freedom of Information 181
Act, as defined in section 1-200. Any revisions or additions to the 182
investment policy statement shall be made in accordance with the 183
procedures set forth in this subdivision for the adoption of the 184
statement. The Treasurer] and the board shall thereafter adopt the 185
statement, including any changes the board deems to be in the best 186
interest of the state and that are approved by a majority of the members 187
in office. The board shall annually review the investment policy 188
statement and [shall consult with the Investment Advisory Council 189
regarding possible revisions to such statement] make available to the 190
public any changes the board deems to be in the best interest of the state 191
and that are approved by a majority of the members in office. The board 192
shall thereafter adopt such revised statement. 193
(2) [All] The Investment Board shall oversee all trust fund 194
investments [by the Treasurer shall be reviewed by the Investment 195
Advisory Council. The Treasurer shall provide to the council all 196
information regarding such investments which the Treasurer deems 197
relevant to the council's review and such other information as may be 198
requested by the council. The Treasurer shall provide a report at each 199
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regularly scheduled meeting of the Investment Advisory Council as to 200
the status of the trust funds and any significant changes that may have 201
occurred or that may be pending with regard to the funds. The council] 202
and shall promptly notify the Auditors of Public Accounts and the 203
Comptroller of any unauthorized, illegal, irregular or unsafe handling 204
or expenditure of trust funds or breakdowns in the safekeeping of trust 205
funds or contemplated action to do the same within said council's 206
knowledge. [The Governor may direct the Treasurer to change any 207
investments made by the Treasurer when in the judgment of said 208
council such action is for the best interest of the state. Said council] The 209
board shall make available to the public monthly investment 210
performance reports and detailed quarterly investment performance 211
reports that clearly show external investment manager performance and 212
fees and benchmarks to investment performances of peer states, as 213
defined by the board. The board shall, at the close of [the] each fiscal 214
year, make a complete examination of the security investments of the 215
state and determine as of June thirtieth, the value of such investments 216
[in the custody of the Treasurer] overseen by the board and report 217
thereon to the Governor, the General Assembly and beneficiaries of such 218
trust funds. [administered, held or invested by the Treasurer. With the 219
approval of the Treasurer and the council, such report may be included 220
in the Treasurer's annual report.] 221
(d) The Investment [Advisory Council] Board shall be within the 222
office of the Treasurer for administrative purposes only. 223
(e) For the purposes of this section, "teachers' union" means a 224
representative organization for certified professional employees, as 225
defined in section 10-153b, and "state employees' union" means an 226
organization certified to represent state employees, pursuant to section 227
5-275. 228
Sec. 4. Section 3-39b of the general statutes is repealed and the 229
following is substituted in lieu thereof (Effective July 1, 2027): 230
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Any state funds invested by the Treasurer shall be for the benefit of 231
the General Fund and all interest earned on such funds shall be credited 232
to the General Fund unless: (1) Otherwise provided by a state statute or 233
bond indenture, (2) a written application is made by the head of any 234
state department, institution, board, commission or other state agency 235
citing a court order, federal regulation, terms of a grant or donation or 236
other unusual circumstance, provided the Treasurer may file with the 237
State Comptroller and the Auditors of Public Accounts any exception to 238
such application, or (3) the [Treasurer] Investment Board established 239
pursuant to subsection (b) of section 3-13b, as amended by this act, 240
deems that it is in the best interest of the state that the investment of 241
such funds and any earning therefrom be for the benefit of and credited 242
to another fund. 243
Sec. 5. Subdivision (11) of section 1-79 of the general statutes is 244
repealed and the following is substituted in lieu thereof (Effective July 1, 245
2027): 246
(11) "Public official" means any state-wide elected officer or officer-247
elect, any member or member-elect of the General Assembly, any person 248
appointed to any office of the legislative, judicial or executive branch of 249
state government by the Governor or an appointee of the Governor, 250
with or without the advice and consent of the General Assembly, any 251
public member or representative of the teachers' unions or state 252
employees' unions appointed to the Investment [Advisory Council] 253
Board pursuant to subsection [(a)] (b) of section 3-13b, as amended by 254
this act, any person appointed or elected by the General Assembly or by 255
any member of either house thereof, any member or director of a quasi-256
public agency and the spouse of the Governor, but does not include a 257
member of an advisory board, a judge of any court either elected or 258
appointed or a senator or representative in Congress. 259
Sec. 6. Subdivision (1) of subsection (a) of section 1-83 of the general 260
statutes is repealed and the following is substituted in lieu thereof 261
(Effective July 1, 2027): 262
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(a) (1) All state-wide elected officers, members of the General 263
Assembly, department heads and their deputies, members or directors 264
of each quasi-public agency, members of the Investment [Advisory 265
Council] Board established under subsection (b) of section 3-13b, as 266
amended by this act, and such members of the Executive Department 267
and such employees of quasi-public agencies as the Governor shall 268
require, shall file electronically with the Office of State Ethics using the 269
software created by the office, under penalty of false statement, a 270
statement of financial interests for the preceding calendar year on or 271
before the May first next in any year in which they hold such an office 272
or position. If, in any year, May first falls on a weekend or legal holiday, 273
such statement shall be filed not later than the next business day. Any 274
such individual who leaves his or her office or position shall file 275
electronically a statement of financial interests covering that portion of 276
the year during which such individual held his or her office or position. 277
The Office of State Ethics shall notify such individuals of the 278
requirements of this subsection not later than sixty days after their 279
departure from such office or position. Such individuals shall file such 280
statement electronically not later than sixty days after receipt of the 281
notification. 282
Sec. 7. Subsection (e) of section 3-13d of the general statutes is 283
repealed and the following is substituted in lieu thereof (Effective July 1, 284
2027): 285
(e) Notwithstanding any provision of the general statutes, neither the 286
Treasurer, the Deputy Treasurer nor any acting Treasurer shall make a 287
private equity or real estate investment without the approval of the 288
Investment [Advisory Council] Board, for the balance of the Treasurer's 289
term of office, on or after any of the following events: (1) The defeat of 290
the Treasurer (A) in a ballot for the party nomination for Treasurer at a 291
convention where said Treasurer was a candidate for nomination, (B) in 292
a primary for nomination for said office where said Treasurer was a 293
candidate for nomination, or (C) upon the completion of a recanvass of 294
the returns from such primary under section 9-445 or 9-446, whichever 295
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is later, (2) the defeat of the Treasurer (A) in the election for said office 296
or (B) upon the completion of a recanvass of the returns from such 297
election under section 9-311, 9-311a or 9-311b, or (3) the resignation of 298
the Treasurer. 299
Sec. 8. Subsections (c) and (d) of section 3-13g of the general statutes 300
are repealed and the following is substituted in lieu thereof (Effective July 301
1, 2027): 302
(c) The State Treasurer (1) may divest, decide to not further invest 303
state funds or not enter into any future investment in any company 304
doing business in Iran; and (2) shall divest and not further invest in any 305
security or instrument issued by Iran. In determining whether to divest 306
state funds in accordance with the provisions of subdivision (1) of this 307
subsection, the factors that the Treasurer shall consider shall include, 308
but not be limited to, the following: (A) Revenues paid by such company 309
directly to the government of Iran; (B) whether the company is doing 310
business in Iran that involves contracts with or provision of supplies or 311
services to (i) the government of Iran, (ii) companies in which the 312
government of Iran has any direct or indirect equity share, (iii) consortia 313
or projects commissioned by the government of Iran, or (iv) companies 314
involved in consortia or projects commissioned by the government of 315
Iran where such business involves oil-related activities, mineral 316
extraction activities, investments that directly and significantly 317
contribute to the development of Iran's petroleum resources or any 318
other business activity that has been made the subject of economic 319
sanctions imposed by the United States government; (C) whether the 320
company has demonstrated complicity with an Iranian organization 321
that has been identified as a terrorist organization by the United States 322
government; (D) whether such company knowingly obstructs lawful 323
inquiries into its operations and investments in Iran; (E) whether such 324
company attempts to circumvent any applicable sanctions of the United 325
States; (F) the extent of any humanitarian activities undertaken by such 326
company in Iran; (G) whether such company is authorized by the 327
federal government of the United States to do business in Iran; and (H) 328
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any other factor that the Treasurer deems prudent. In the event that the 329
Treasurer determines that divestment of state funds is warranted from 330
a company in which state funds are invested due to such company 331
doing business in Iran, the Treasurer shall give notice to such company 332
that such funds shall be divested from such company for as long as such 333
company does business in Iran. 334
(d) The State Treasurer shall, at least once per fiscal year, provide a 335
report to the Investment [Advisory Council] Board on actions taken by 336
the Treasurer pursuant to the provisions of this section. 337
Sec. 9. Section 3-13i of the general statutes is repealed and the 338
following is substituted in lieu thereof (Effective July 1, 2027): 339
(a) On and after January 1, 2001, or on and after the first adoption of 340
an investment policy statement under section 3-13b of the general 341
statutes, revision of 1958, revised to January 1, 2025, whichever is later, 342
any contract for services related to the investment of trust funds, as 343
defined in section 3-13c, shall be subject to [the] such investment policy 344
statement, [adopted under section 3-13b] except that any contract for 345
services related to the investment of such trust funds, entered into on or 346
after the first adoption of an investment policy statement by the 347
Investment Board under subsection (c) of section 3-13b, as amended by 348
this act, shall be subject to the investment policy statement under 349
subsection (c) of section 3-13b, as amended by this act. 350
(b) No contract for services related to the investment of such funds 351
shall be awarded to a provider of such services until the Treasurer's 352
recommendation of a provider is reviewed by the Investment [Advisory 353
Council] Board. The Treasurer shall provide notice of such 354
recommendation at a meeting of the [council] board. Not later than 355
forty-five days after such meeting, the [council] board may file a written 356
review of the Treasurer's recommendation concerning the selection of 357
such provider with the [Office] office of the Treasurer where it shall be 358
available for public inspection. The Treasurer may proceed to award the 359
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contract after such forty-five-day period. 360
Sec. 10. Subsections (c) and (d) of section 3-21e of the general statutes 361
are repealed and the following is substituted in lieu thereof (Effective July 362
1, 2027): 363
(c) The State Treasurer (1) may divest, decide to not further invest 364
state funds or not enter into any future investment in any company 365
doing business in Sudan, and (2) shall divest and not further invest in 366
any security or instrument issued by Sudan. In determining whether to 367
divest state funds in accordance with the provisions of subdivision (1) 368
of this subsection, the factors [which] that the Treasurer shall consider 369
shall include, but not be limited to, the following: (A) Revenues paid by 370
such company directly to the government of Sudan, (B) whether such 371
company supplies infrastructure or resources used by the government 372
of Sudan to implement its policies of genocide in Darfur or other regions 373
of Sudan, (C) whether such company knowingly obstructs lawful 374
inquiries into its operations and investments in Sudan, (D) whether such 375
company attempts to circumvent any applicable sanctions of the United 376
States, (E) the extent of any humanitarian activities undertaken by such 377
company in Sudan, (F) whether such company is engaged solely in the 378
provision of goods and services intended to relieve human suffering, or 379
to promote welfare, health, education, religious or spiritual activities, 380
(G) whether such company is authorized by the federal government of 381
the United States to do business in Sudan, (H) evidence that such 382
company has engaged the government of Sudan to cease its abuses in 383
Darfur or other regions in Sudan, (I) whether such company is engaged 384
solely in journalistic activities, and (J) any other factor that the Treasurer 385
deems prudent. In the event that the Treasurer determines that 386
divestment of state funds is warranted from a company in which state 387
funds are invested due to such company doing business in Sudan, the 388
Treasurer shall give notice to such company that such funds shall be 389
divested from such company for as long as such company does business 390
in Sudan. 391
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(d) The State Treasurer shall, at least once per fiscal year, provide 392
reports to the Investment [Advisory Council] Board on actions taken by 393
the Treasurer pursuant to the provisions of this section. 394
Sec. 11. Subsection (a) of section 3-37 of the general statutes is 395
repealed and the following is substituted in lieu thereof (Effective July 1, 396
2027): 397
(a) The Treasurer shall, annually, on or before December thirty-first, 398
submit a final audited report to the Governor and a copy of such report 399
to the Investment [Advisory Council] Board, which shall include the 400
following information concerning the activities of the office of the State 401
Treasurer for the immediately preceding fiscal year ending June 402
thirtieth: (1) Complete financial statements and accompanying footnotes 403
for the combined investment funds prepared in accordance with 404
generally accepted accounting principles, which financial statements 405
shall be audited in accordance with generally accepted auditing 406
standards and supplementary schedules depicting the interests of the 407
component retirement plans and trust funds; (2) complete financial 408
statements and accompanying footnotes for the Short Term Investment 409
Fund prepared in accordance with generally accepted accounting 410
principles and supplementary schedules listing all assets held by the 411
Short Term Investment Fund; (3) a discussion and review of the 412
performance of the combined investment funds and Short Term 413
Investment Fund for such fiscal year in accordance with recognized and 414
appropriate performance presentation and disclosure, including an 415
analysis of the return earned by the portfolio and each combined 416
investment fund as well as the risk profile of the portfolio and each 417
combined investment fund according to investment industry standards; 418
(4) the activities and transactions in such reasonable detail as is 419
appropriate of the cash management division including information on 420
the state's cash receipts and disbursements for the fiscal year, and the 421
debt management division; (5) financial statements and accompanying 422
footnotes as well as a summary of operating results for the Second Injury 423
Fund for such fiscal year; (6) a financial summary and report on the 424
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activities of the state's unclaimed property program for such fiscal year; 425
(7) a listing of the companies from which state funds were divested 426
based upon such companies' business in Sudan, pursuant to the 427
provisions of section 3-21e, as amended by this act, and any companies 428
identified by the Treasurer as companies from which investment of state 429
funds has been declared impermissible by the Treasurer, pursuant to the 430
provisions of section 3-21e, as amended by this act; and (8) such other 431
information as the Treasurer deems of interest to the public. 432
Sec. 12. Subdivisions (3) and (4) of subsection (e) of section 9-612 of 433
the general statutes are repealed and the following is substituted in lieu 434
thereof (Effective July 1, 2027): 435
(3) Neither the State Treasurer, the Deputy State Treasurer, any 436
unclassified employee of the office of the State Treasurer acting on 437
behalf of the State Treasurer or Deputy State Treasurer, any candidate 438
for the office of State Treasurer, any member of the Investment 439
[Advisory Council] Board established under subsection (b) of section 3-440
13b, as amended by this act, nor any agent of any such candidate may 441
knowingly, wilfully or intentionally solicit contributions on behalf of an 442
exploratory committee or candidate committee established by a 443
candidate for nomination or election to any public office, a political 444
committee or a party committee, from a principal of an investment 445
services firm. The provisions of this subdivision shall apply only to 446
contributions and the solicitation of contributions that are not 447
prohibited under subdivision (3) of subsection (f) of this section. 448
(4) No member of the Investment [Advisory Council] Board 449
appointed under subsection (b) of section 3-13b, as amended by this act, 450
shall make a contribution to, or solicit contributions on behalf of, an 451
exploratory committee or candidate committee established by a 452
candidate for nomination or election to the office of State Treasurer. 453
Sec. 13. (NEW) (Effective from passage) (a) (1) Not later than January 1, 454
2026, the Office of Legislative Management shall issue a request for 455
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proposals for the services of a private advisory firm with demonstrated 456
expertise in asset management and financial services, to conduct an 457
annual independent review of the investment performance of the state's 458
pensions funds. Any advisory firm with a conflict of interest shall be 459
disqualified from submitting a proposal. For purposes of this section, a 460
conflict of interest exists if the advisory firm (A) has an existing contract 461
with the office of the Treasurer or for investment management of the 462
state's pension funds, (B) has accepted any fees for work related to the 463
management of the state's pension funds, (C) employs an employee or 464
employees who are affiliated with or connected to the management of 465
the state's pension funds, or (D) is likely to engage in contract work 466
related to the management of the state's pension funds within twelve 467
months of the date a proposal is submitted. 468
(2) The Office of Legislative Management shall contract with an 469
advisory firm not later than January 1, 2027, and shall notify the 470
following of the firm selected: The speaker of the House of 471
Representatives, the president pro tempore of the Senate, the minority 472
leaders of the House of Representatives and the Senate, the chairpersons 473
and ranking members of the joint standing committee of the General 474
Assembly having cognizance of matters relating to finance, revenue and 475
bonding and the office of the Treasurer. If the Office of Legislative 476
Management is unable to enter into a contract by said date, said office 477
shall inform the chairpersons of said committee and shall provide a 478
projected date by which said office expects to enter into such contract. 479
(3) Any such contract shall include a provision that if any of the 480
conditions described under subparagraphs (A) to (D), inclusive, of 481
subdivision (1) of this subsection become applicable to the advisory 482
firm, the contract shall be terminated in accordance with an agreed-483
upon timeframe set forth in such contract. 484
(4) No advisory firm that contracts with the Office of Legislative 485
Management, or any employee of such firm in a decision-making 486
capacity related to asset management, may enter into a contract with, 487
Raised Bill No. 1557
LCO No. 7064 17 of 18
receive any payments from or perform any work for the office of the 488
Treasurer or the state's pension funds for a period of two years 489
following the termination of a contract under this section with the Office 490
of Legislative Management. 491
(b) The advisory firm shall submit a report annually to the joint 492
standing committee of the General Assembly having cognizance of 493
matters relating to finance, revenue and bonding, in accordance with the 494
provisions of section 11-4a of the general statutes, for each year such 495
firm is providing services under the contract executed pursuant to 496
subsection (a) of this section. Such report shall include, but need not be 497
limited to, (1) a comparative analysis of the state's investment 498
performance, benchmarked against the performance of at least fifty peer 499
state public pension funds across aggregate performance, individual 500
asset class performance and short-term and long-term time periods, (2) 501
a comparison of the state's investment performance for each asset class 502
against commonly accepted financial benchmark indices used by a 503
majority of other states, and (3) any recommendations for 504
improvements in the investment management practices and processes 505
of the state's pension funds. 506
This act shall take effect as follows and shall amend the following
sections:
Section 1 July 1, 2027 3-12a
Sec. 2 July 1, 2027 3-13a
Sec. 3 July 1, 2027 3-13b
Sec. 4 July 1, 2027 3-39b
Sec. 5 July 1, 2027 1-79(11)
Sec. 6 July 1, 2027 1-83(a)(1)
Sec. 7 July 1, 2027 3-13d(e)
Sec. 8 July 1, 2027 3-13g(c) and (d)
Sec. 9 July 1, 2027 3-13i
Sec. 10 July 1, 2027 3-21e(c) and (d)
Sec. 11 July 1, 2027 3-37(a)
Sec. 12 July 1, 2027 9-612(e)(3) and (4)
Sec. 13 from passage New section
Raised Bill No. 1557
LCO No. 7064 18 of 18
Statement of Purpose:
To (1) establish the Investment Board and sunset the Investment
Advisory Council, and (2) require the Office of Legislative Management
to issue a request for proposals for an advisory firm to conduct an
independent review of the investment performance of the state's
pension funds relative to peer states' investment performances and
submit a report of such review on an annual basis.
[Proposed deletions are enclosed in brackets. Proposed additions are indicated by underline, except
that when the entire text of a bill or resolution or a section of a bill or resolution is new, it is not
underlined.]