Public Pension Plans: Evaluation of Economically Targeted Investment Programs
PEMD-95-13
Published: Mar 17, 1995. Publicly Released: Apr 12, 1995.
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Highlights
Pursuant to a congressional request, GAO reviewed economically targeted investments (ETI), focusing on the: (1) amount and types of ETI being invested by nonfederal public employee pension plans; (2) realization of competitive returns by ETI programs aimed at business development; and (3) economic effects of business development ETI programs.
Recommendations
Matter for Congressional Consideration
| Matter | Status | Comments |
|---|---|---|
| If Congress decides to initiate a program to promote public or private pension plan investment in ETI, it should ensure that participation in the program is voluntary, not mandatory. | In the 104th Congress, the majority strongly opposed the promotion of ETIs and legislation was passed by the House that would prohibit ETIs. No action is likely in the 105th Congress. |
Recommendations for Executive Action
| Agency Affected | Recommendation | Status |
|---|---|---|
| Department of Labor | The Department of Labor should explore methods to evaluate the success of ETI in promoting development objectives and then collect data that would permit such an evaluation, to the extent that is cost-beneficial. |
In 1994, DOL entered into a 2-year contract to establish an information clearinghouse on ETIs. The contract expired in September 1996, and the Department plans no further action. The contractor established the clearinghouse and, subsequent to the contract, continues to gather and disseminate information on ETIs to the general public.
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Topics
CapitalEconomic developmentEmployee retirement plansInvestment planningInvestmentsPension plan cost controlPensionsSmall business investment companiesTrust fundsPension plan