Director Gets Golden Parachute; Minneapolis Citizens Get Golden...Parachute Bill

MDE notes that the Minneapolis Teachers Pension Fund director is getting a golden parachute...

...for leaving a billion dollars in obligations unfunded:

The executive director of the Minneapolis Teachers Retirement Fun Association received a "golden parachute" for running a pension fund that has $1 billion in unfunded pension obligations...With plans for the merger progressing, the Minneapolis teachers pension board in March extended the contract of its executive director, Karen Kilberg, a year beyond the date when the fund would cease to exist under the merger. It also granted her a six-month severance. The entire package is worth $215,000." Source: Star Tribune, April 12, 2006

Kilberg is going to collect a paycheck until July 1, 2007, from an organization that will probably no longer exist in a month.

Why is this a problem?

"But during 10 years when Kilberg directed the fund, it earned less from investments than most large government pension funds in Minnesota, according to calculations by the commission. The Minneapolis fund earned $218 million less from 1994 to 2004 than it would have earned had it performed as well as the State Board of Investment, which handles money for the Teachers Retirement Association.

Read the whole thing.

Posted by Mitch at April 13, 2006 07:00 AM | TrackBack