SC politics: Retirement system staff gets $1.4 million in bonuses

October 4, 2013 

Agency’s investment staff gets $1.4 million in bonuses

Fourteen staff members of the agency that invests pension money for S.C. public employees are receiving a combined $1.4 million in bonuses for the portfolio’s performance.

The Retirement System Investment Commission approved the performance payments last week for the agency’s investment staff. The amounts range from $30,000 to $300,000.

Treasurer Curtis Loftis, R-Lexington, cast the board’s lone no vote.

The payments were calculated according to a “performance incentive” plan that commissioners, including Loftis, approved unanimously last year. They are based on how the pension system’s returns on its investments compare to goals over a one, two-, three- and five-period. Every eligible employee received the maximum under the plan, with amounts varying by position and base pay. The bonuses allowed the four highest-paid staff – the chief investment officer, deputy investment officer and two directors – to double their base salary.

The commission contends the payments are not bonuses, but rather part of employees’ compensation, structured to attract and retain high-caliber staff in a way that rewards performance.

State senators also approved the plan last year, as state law required. On Friday, Loftis urged the Legislature to revisit the issue, saying “the mismatch of returns, fees and bonuses cost the state hundreds of millions of dollars every year.”

Loftis has long complained the agency pays too much in fees for too little return. “It is clear the commission should spend less time paying outrageous bonuses and more time raising returns and lowering fees.”

The state’s portfolio is worth $27 billion. Last month, the agency reported a net return, after fees and expenses, of 9.99 percent for the fiscal year ending June 30. The state assumes a 7.5 percent annual return when calculating what it needs to keep the pension system solvent.

New credit-monitoring contract takes effect

South Carolina’s next contract for state-paid consumer protection services took effect Friday for taxpayers affected by last fall’s massive hacking of the state’s tax-collection agency.

Budget and Control Board spokeswoman Rebecca Griggs said no one protested the state’s intent to award the contract to Texas-based CSIdentity Corp., issued Sept. 23, so it took effect at 8 a.m. Friday.

People and businesses will be able to sign up by Oct. 24. Details on how to sign up are expected in the coming weeks. The service is free to those who enroll.

Last year, the state paid $12 million to the credit bureau Experian through a no-bid contract that Gov. Nikki Haley negotiated after state officials learned of the cyber-theft last October. Nearly 1.5 million people signed up for that credit-monitoring service, which provided daily monitoring of the three credit bureaus for newly opened credit accounts.

The state will pay CSID up to $8.5 million for more extensive monitoring designed to catch other ways stolen identities are used. The state’s total payment will depend on how many people sign up over the next year and when.

Last September, a cyber-thief stole unencrypted information from state tax filings on 3.8 million adults, 1.9 million of their dependents, and 700,000 businesses. It’s not clear whether any of those people or businesses became identity theft victims as a result.

All 6.4 million are eligible for CSID’s services. To get the monitoring, people must enroll, whether they signed up through Experian or not. The service will not transfer.

The Associated Press

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