A corollary to Jason Carter's economic plan in his bid for governor is his support for an oft-debated proposal that would give teacher pension funds more leeway to invest in Georgia's startups.
The Democrat argues in his economic pivot that he wants teacher pensions to be able to pump funds into local startups "so long as we're making sure that we can manage the risk in ways that make sense." He sees it as a way to boost a state-backed effort to invest in venture capital firms that, as you'll see in today's AJC, has lagged.
"The things that concern the teachers is to make sure you're stewarding the pension appropriately. So it's crucial to make sure that we are managing the risk in ways that works," he said. "But we shouldn't have those pension funds losing out on higher growths and higher returns just because of artificial caps on what it can do."
Georgia lawmakers cleared the way for pension funds to invest up to 5 percent of their assets in alternative investments, such as venture capital firms, that had at least $100 million on the books. But the law excluded the Teachers Retirement System of Georgia, the state's largest public pension with nearly $59 billion in assets.
North Carolina and other nearby states allow their teachers' fund to invest in startups, but Gov. Nathan Deal and other Republicans have raised red flags. Lawmakers signaled they were reluctant to include the teachers fund in the 2012 legislation because the group's board hadn't approved the changes.
Critics of the change say that allowing pension investments to pump more money into local startups could dilute the diversification of the funds while ramping up the risk. They also worry about the cronyism factor, saying that it would be hard to keep politics out of investment choices.
Recent legislative efforts to give the teachers pension that flexibility have gotten little traction. Carter, though, said he would make it an economic priority should he win November's election.
"You want to make sure you're investing in ways that make sense, that send an appropriate message, but that also manage and control the risk," he said, adding: "Whatever we're going to do with the teacher pension fund, we're going to do by respecting and communicating with that community."
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