Copyright © 2018 Albuquerque Journal
The board that oversees New Mexico’s pension system for teachers and other educators wants to give its top executives pay raises that average 28 percent – enough to push the top two earners to above $240,000 a year.
But Gov. Susana Martinez’s administration says it will block the proposed raises – calling them “highly inappropriate.”
A spokesman for one of New Mexico’s teachers unions, in turn, described the raises as “tone deaf.”
It isn’t clear yet how the standoff will be resolved.
The state Educational Retirement Board approved the increases in December and has asked the state Department of Finance and Administration to make the corresponding changes in the employees’ pay. The employees haven’t, however, received the raises.
Mary Lou Cameron, a retired teacher from Deming and chairwoman of the ERB’s Board of Trustees, said the raises are justified by the need to retain the best-qualified people to help manage a $12 billion fund. Many of the fund’s investments are handled in-house, at a savings of millions of dollars, she said.
And a salary survey of executives at similar pension funds in other states, Cameron said, showed that New Mexico’s top staffers are paid near the bottom compared with their peers.
Nevertheless, Cameron said, she was “torn” on the raises because her heart lies with the educators working inside New Mexico schools.
“We don’t take this lightly,” she said of the decision.
The top staffers targeted for raises, Cameron said, “stayed with us in spite of having many other opportunities to go elsewhere.”
Under the proposed pay schedule, Executive Director Jan Goodwin’s salary would climb to $240,000 a year, a 46 percent increase over the roughly $165,000 she makes now, according to the state’s online employee listing. She hasn’t received a raise in three years.
Three other top staffers would also get sizeable raises.
The Martinez administration said the raises would put the ERB salaries out of line with the pay of New Mexico’s highest-earning elected officials and the executives at the state’s other major pension fund, the Public Employees Retirement Association.
Emilee Cantrell, a spokeswoman for the Department of Finance and Administration, also highlighted the unfunded liabilities at the ERB – the difference between the organization’s assets and its future obligations.
“It’s highly inappropriate to request massive raises for high level positions at ERB – while the hard-working people who rely on the ERB for their income have watched the fund become insolvent,” Cantrell said. “The people of New Mexico expect positive results to be rewarded, not insolvency.”
Goodwin, the ERB executive director, said it’s inaccurate to describe the fund as insolvent and that it’s in no danger of running out of money to pay its bills.
The ERB currently covers roughly 60,000 active members and pays benefits to more than 47,000 retired teachers, school administrators and higher education officials.
A national rating agency downgraded New Mexico’s credit rating earlier this week, citing, in part, the state’s pension liabilities.
ERB estimates its unfunded liability at $7.4 billion and its funded ratio at 63 percent.
Pension funds across the country have struggled to reach full funding.
John Dyrcz, a spokesman for the American Federation of Teachers New Mexico, said union members plan to discuss the raises in a meeting next month with members of the Educational Retirement Board.
“At a time when we know that teachers and educational workers are underpaid themselves and the Educational Retirement Board is vastly underfunded,” he said, “it’s a tone deaf message to send out.”
Journal Capitol Bureau Chief Dan Boyd contributed to this report.
• Executive Director Jan Goodwin would receive a $240,000 salary, an increase of 46 percent over her current salary of $165,000.
• Deputy Director Rick Scroggins would get $179,000, a 49 percent increase over his current salary of about $120,000.
• General Counsel Roderick Ventura would get $130,000, an 18 percent increase over his current pay of $110,000.
• Chief Investment Officer Bob Jacksha would get $260,000, a 9 percent increase over his current salary of about $238,000.
Source: Educational Retirement Board documents and state online salary directory