Treasurer facing 3 challengers
By Scott Mooneyham
Capitol Press Association
RALEIGH — Many North Carolinians probably consider the North Carolina treasurer to be the state’s banker.
That’s not exactly the case. An appointed controller (right now, a man named David McCoy) manages and watches state government’s cash flow.
The state treasurer, on the other hand, serves as the state’s investor-in-chief and debt manager. The most important part of the job is managing the $7 billion pension fund used to pay retirement benefits to retired state employees.
Current Treasurer Janet Cowell has been in the job for a single, four-year term. She faces both a primary challenge and general election opposition in a bid for a second term.
Cowell, 43, is touting both the relative stability of the pension fund and the state’s good standing when it comes to borrowing money, along with changes that she has brought to investing.
One of her first acts on taking the job was having an external examination of investing operations. Cowell followed up with the hiring of an internal auditor to better enforce investing policies and procedures.
She also convinced state lawmakers to pass legislation that expanded pension fund investing into commodities and more private equity, and added members to an investing advisory board.
Her first term hasn’t been without controversy. Cowell fired chief investment officer Patricia Gerrick following allegations that investment managers hired by the pension fund offered her and her daughter favors. Cowell also responded with a new ethics policy.
Cowell’s opponent in the Democratic primary is Ron Elmer, a certified public accountant, financial planner and investment manager who lives in the Raleigh suburb of Cary.
Elmer, who once worked for financial institutions, including First Citizens Bank, in investment management, is emphasizing his experience. He’s also criticizing the performance of pension fund investments under Cowell.
Elmer notes that North Carolina’s pension fund has under-performed compared to other states and failed to meet benchmarks established by Cowell. He also says investment fees paid to outside investment fund managers should be lower.
“I believe if a professional investment manger were running the State Treasurer’s office, we could do better than median,” Elmer says.
In the Republican primary, former Wall Street currency trader Frank Roche faces certified public accountant Steven Royal.
Roche, 48, who made an unsuccessful bid for Congress in 2010, hosts a radio show. He also lives in Cary.
Roche has also been critical of the pension fund’s performance and believes that state debt — which primarily supports state building — is too high. Rising debt, he said, will ultimately hurt both state employees and taxpayers.
Royal, 61, has worked as a CPA in Elkin for more than two decades, and also been a community college instructor. He describes himself as a reformer who will only serve a single term if elected.
Royal believes that the treasurer’s office needs to be more transparent and accountable. He has also criticized the state’s debt load.
Regarding transparency, Royal points to initially undisclosed losses from pension fund securities lending.
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Scott Mooneyham writes about state issues for Capitol Press Association.