New Jersey Senate Bill S1514

New Jersey 2024-2025 Regular Session

• Introduced: 1/9/24
• Refer: 1/9/24

Caption

Requires State Investment Council to publish reports comparing returns earned by external and internal managers and requiring Council to make recommendations regarding investments.

Impact

If enacted, this bill will significantly alter existing procedures under which the State Investment Council operates. Currently, the Council is obligated to report annually on the returns and fees associated with hired fund managers but lacks an obligation to conduct comparative assessments between external and internal managers. S1514 aims to rectify this by requiring quarterly comparisons, thereby fostering a more competitive and transparent investment landscape for state funds.

Summary

Senate Bill 1514 is designed to enhance transparency and accountability within the management of state-administered retirement system funds in New Jersey. The bill mandates that the State Investment Council publish detailed reports comparing the investment returns achieved by external fund managers with those earned by internal division managers. This requirement aims to ensure that decisions regarding the management of retirement funds are based on performance metrics and enhances the oversight of fund management policies.

Contention

One potential point of contention surrounding SB 1514 could relate to the implications of increased accountability for external fund managers. Supporters of the legislation argue that the rigorous evaluation of external versus internal management can lead to more informed decisions on investments, driving higher returns for retirement funds. However, detractors may express concerns over the administrative burden this could impose on the Council and possible repercussions on the willingness of external managers to engage with state contracts due to heightened scrutiny and expectations.