Cole McNary says Missourians deserve the real financial truth from the state treasurer’s office even if the truth hurts.
Calling himself a “budgetary straight-shooter,” the Republican challenger in the Missouri state treasurer’s race says he would instill more transparency in the office if elected.
“My message is about transparency and full disclosure,” McNary said in a campaign stop in Washington last week. “You need to tell the truth, the whole truth, so people know what’s going on. The current treasurer is not being real with voters.”
It is a theme McNary has repeated in campaign stops throughout the state in his bid to unseat current state treasurer, Clint Zweifel, a Democrat.
The race for treasurer, like some of the other down-ballot contests, has been relatively quiet so far. Many voters say they are unfamiliar with both candidates even though Zwei-fel has been in office the past four years.
The treasurer’s office manages the state’s multibillion dollar investment portfolio. It invests state funds, holds Missourians’ unclaimed property and administers a college savings plan and a program that helps businesses get low-interest loans. The treasurer also serves on governing boards for the Missouri Housing Development Commission, the Missouri Higher Education Savings Program and the Missouri State Employees’ Retirement System.
McNary, 48, a two-term legislator from Chesterfield, said one area where Zweifel hasn’t been straight with voters is with regard to state pensions.
“All states are wrestling with pension issues,” McNary noted. “It is one of the areas that has caused tension between state workers and taxpayers. Look at the cities that have gone bankrupt over employee pensions. Many states are facing the same predicament. Revenues are down and states don’t have the money to meet their obligations. How did they get there? They made promises they couldn’t keep.”
McNary said many of the state’s pensions — including its largest are underfunded according to industry benchmarks.
The minimum standard for pension health is a funding level at 80 percent and according to McNary, the majority of the state’s 126 public pensions have fallen below the 80 percent funding level.
Some plans report levels as high as 77 percent and others as low as 43 percent. Not only do these contributions fall short, McNary argues, they also are based on accounting principles that fail to incorporate realistic economic trends and market conditions.
McNary said he would conduct a thorough, systematic review of the pension system within his first six months of office. He also said he would advocate for greater fiscal truth and transparency by requiring managers to disclose data that uncovers not only the current expenses of state and local plans, but also careful explanations as to our assumptions of rates of return, inflation, payroll growth, and other economic assumptions.
McNary said he would like to bring the experience he gained in the Legislature chairing the Committee on Downsizing State Government “to the next level.” He said that committee was successful in eliminating duplicate and out-of-state statutes and about 60 unfunded programs. He said the committee also streamlined government by combining boards and commissions that did essentially the same thing.
“Our work was about efficiency and restructuring,” McNary said of the committee. “I worked with state bureaucrats and legislators across the aisle to get things done. We started the ball rolling in the Legislature and I want to see it keep going. The treasurer’s office, like the lieutenant governor and secretary of state’s offices, are what you make of them. I think the treasurer’s office could make a significant contribution in this area.”
Zweifel defends his work on pensions. He told The Associated Press that the week he took office he learned and then publicly disclosed the state retirement system had invested in a Bernie Madoff feeder fund. He said McNary’s committee work had little economic or budgetary effect and that many pension policies are governed by Missouri law, which gives a state legislator opportunities to make changes.
As treasurer, Zweifel said he has improved the performance of Missouri’s college savings plan and persuaded the state housing commission to support an initiative dedicating 30 percent of its resources to helping military veterans returning from overseas, those aging out of the foster care system and the mentally ill.
In 2009, Zweifel got the Republican-led Legislature to remove the cap on interest state government can earn for its deposits and broaden the low-interest business loan program. He also has worked to improve how unclaimed property is handled by processing claims faster and permitting them to be made online.
McNary has a different view of Zweifel’s record especially the rate of return the state is getting on its investments under Zweifel’s leadership.
“My point is that he’s had the job for the last four years and done nothing. He is getting a return (overall) of 0.7 percent. Look, it’s very difficult to get a high rate of return in this economy, but 0.7 percent return is not something to brag about,” McNary added.
Zweifel, 38, was part of the Democrats’ near-complete sweep of Missouri’s statewide offices in 2008. He served three terms in the state House and was the first person in his family to attend college. While attending the University of Missouri-St. Louis, Zweifel decided to run for student body vice president and met his wife while campaigning.
McNary also met his wife on the campaign trail. He was campaigning on behalf of his father, Gene McNary, in 1984 when he met her.
Gene McNary, a well-known Republican leader, served as St. Louis County executive and ran unsuccessfully for the U.S. Senate, governor and Congress.
Libertarian Sean O’Toole, of Kansas City, also is running in the treasurer’s race.
The Associated Press contributed to this story.