April 10, 2010

Pension investment chief retains bonus, while most state workers get pay cuts

Print More

By Andy Rosen
Andy@MarylandReporter.com

A budget measure to carve out a bonus for the chief investment officer of the state pension fund during a pay freeze met with criticism as the Senate gave final approval to the state budget Friday.

The upper chamber voted to approve the compromise with the House on about $32 billion in spending. Delegates must give the measure one more thumbs up before it becomes law. Together, the two chambers cut less than $100 million from Gov. Martin O’Malley’s original budget allowance.

A last-minute item adopted by a conference committee between the two chambers allows for a bonus of up to 10 percent for Mansco Perry III, who manages more than $28 billion in assets for the employee pension funds.

According to an agreement with the state, Perry would be eligible for a bonus of up to 33 percent. His base salary is $239,000.

Senate Budget Committee Vice Chair Ed Kasemeyer, D-Baltimore and Howard, said O’Malley’s budget would not have allowed for any pay increase for Perry.

The pension fund lost $8 billion last year, but Kasemeyer said the system has made a strong recovery since last July, recovering those losses. Perry has done well by the fund since he came on in 2008, he said.

“We weren’t making the returns on our investments that had been anticipated,” he said. “One reason is that we felt we needed a higher-quality [employee] to serve in the role as chief investment officer.”

The budget also makes exceptions for University System of Maryland employees, in order to prevent them from being lured away by other universities.

Sen. George Della, D-Baltimore City, said he didn’t think there should be an exception for Perry.

“I don’t know why we’re carving this man out, treating him something special while we’re treating everybody else not too kindly,” he said.