Robert L. Borden, the flamboyant Lamborghini-driving chief of the S.C. Retirement Systems Investment Commission (SCRSIC), resigned from his post on Friday to take a position with a North Carolina investment start-up.
Borden, whose five-year tenure has been marked by secrecy and controversy, makes a whopping $485,000 a year (not counting his government benefits). He was also in line to receive a one-day bonus of $66,000 earlier this year before that raise was blocked by S.C. Treasurer Curtis Loftis.
In an interview with The (Columbia, S.C.) State newspaper, Borden acknowledged that will be taking a pay cut as he prepares to enter the private sector – which should tell you all you need to know about the exorbitant pay state government is doling out to bureaucrats.
Sources familiar with Borden’s decision say it comes as a result of an internal investigation that Loftis’ office launched earlier this year.
FITS referenced that investigation in a story we posted earlier this week.
A source close to Loftis said that the Treasurer hopes Borden’s departure will usher in a “new era of sunlight” at the agency.
“Whoever is chosen as his replacement is going to have to be transparent about these investments and transparent about their role in these investments,” the source said. “These are the people’s assets.”
Loftis has been seeking specific information from Borden’s office – including travel records and expense account information – which Borden has thus far refused to provide. In fact, Loftis has been forced to send Freedom of Information Act (FOIA) requests to the SCRSIC in order to obtain the information.
Several of those requests have been ignored.
In addition to Borden’s lack of transparency, the state’s retirement fund is currently faced with unfunded liabilities totaling anywhere between $14-17 billion. We’ve offered several common sense ideas on how to lower that deficit, but so far state lawmakers and Gov. Nikki Haley have been unwilling to embrace those reforms.
Borden’s original plan was for state government to create a new investment corporation that would manage up to $9 billion in retirement assets – including investments in South Carolina companies. The new company – dubbed “NewCo” – would have employed 50 people and operated on an annual budget of $29 million, which ostensibly would have been paid for out of “savings” in investment fees. “NewCo” would have managed up to $6 billion in retirement assets almost immediately – while eventually managing up to $8.7 billion of the state’s $25 billion pension fund.
Under the proposed plan, executive salaries would have risen to private sector heights. But unlike the private markets, these employees would not have their own money invested in the scheme …
Needless to say, the creation of this new entity was fraught with all sorts of ethical problems – most notably a complete lack of transparency and accountability at any step of the process. Basically, public employees’ savings would have been spent/ invested under the plan without their input … and with no oversight from either the legislative or executive branches of government.
That’s why the S.C. Budget and Control Board under S.C. Gov. Mark Sanford rejected the scheme.
While Borden’s initial effort failed … he has successful begun the process of taking this idea “in-house.”
Borden’s commission – which had a $5.8 million budget a year ago – convinced Haley and our “Republican-controlled” S.C. General Assembly to appropriate another $5.5 million in the current budget. The agency was planning to ask for $19 million in the coming budget, although it’s unclear how Borden’s departure will impact the agency’s budget request.