A group of 16 Oregon state lawmakers is calling for a formal audit of the Oregon Public Employees Retirement Fund. These legislators sent a letter to Treasurer Elizabeth Steiner and the Oregon Investment Council, arguing that the fund has not undergone a full investment program audit in a decade. State law mandates this review every four years, with the last completed assessment occurring ten years ago.
The request follows reports regarding the pension fund's heavy reliance on private equity. Legislative concerns surfaced after public disclosures suggested that the fund reached a 27% allocation in private equity at one point, which critics claim contributed to poor returns and a significant financial impact during the 2024 fiscal year. While the Treasury has taken steps to reduce these allocations, lawmakers maintain that current reviews do not satisfy statutory requirements for a broad program audit.
Beyond private equity allocation, the letter outlines a series of areas the auditors should address. The lawmakers want an assessment of how technological shifts, geopolitical threats, and climate change influence long-term investment performance. They specifically pointed to holdings in private detention centers and surveillance technology firms as areas requiring closer inspection. The request also highlights a need for greater transparency regarding investment manager fees and the overall management of state assets.
Treasurer Steiner previously expressed agreement with the push to lower private equity exposure, aiming for a 20% target. However, the signatories of this letter believe that a more comprehensive, legally mandated audit is the only way to ensure the long-term stewardship of the $100 billion fund. As of now, the Treasury has not provided a formal response to the request for the review. Lawmakers characterize the audit as a necessary safeguard to protect the retirement security of public employees across the state.