August 25, 2017
To the Honorable
Members of
The Illinois Senate,
100th General
Assembly:
Today,
I veto Senate Bill 1714, which would add reporting requirements for consultants
retained by retirement system, pension fund, or investment boards.
This
legislation is a classic example of multiplying red tape without first
demonstrating any benefit. Retirement system, pension fund, and investment
boards all hire consultants to help identify investment opportunities. Under this
bill, all consultants now will have to report to the boards that hired them on their
engagement with investment services provided by a minority-owned business, a female-owned
business, or a business owned by a person with a disability.
There
is no showing that this blanket requirement is necessary to produce some
tangible benefit. To be sure, accountability and transparency, which ostensibly
motivate this bill, are laudable goals, and we should expect all retirement systems,
pension funds, and investment boards to demand from their consultants this type
of information. However, nothing currently is preventing us from making this
demand of these boards.
Left
to their own devices, the boards should be expected to implement requirements that
make sense for each board. Contrast that with blanket legislation like this bill,
which would impose the same rigid requirements regardless of each board’s
unique circumstances. That, of course, is the main problem with legislating additional
red tape. We should do better and should immediately ask all retirement systems,
pension funds, and investment boards to implement and be held accountable for
guidelines in the spirit of what this bill would unforgivingly mandate.
Therefore,
pursuant to Section 9(b) of Article IV of the Illinois Constitution of 1970, I
hereby return Senate Bill 1714, entitled “AN ACT concerning public employee
benefits,” with the foregoing objections, vetoed in its entirety.
Sincerely,
Bruce Rauner
GOVERNOR