State Treasurer Refutes House’s Testimony, Says Budget Request Would Help Boost Revenue for the State

Wyoming State Treasurer Curt Meier said Wednesday he believes an amendment that
was voted down Tuesday by Wyoming’s House of Representatives was at least partially the result of inaccurate testimony by some Legislators. The Treasurer’s Office is requesting $320,000 to help fund additional due-diligence contracts over the next biennium. Meier said as the State’s investment pool grows, the number of financial opportunities increases correspondingly. While the investment team analyzes and then pinpoints the best opportunities, some of these finalists contain enough complexities where it becomes prudent for a hired consultant to provide an extra set of eyes to confirm the data and identify any possible red flags.

“Denying this budget request is being penny wise and dollar foolish,” Meier said. “When you are ready to turn over and invest $100 million to $500 million with someone, you really need to make sure you know everything you can about them.” “We are not just looking at discounted cash flows reported by companies or buying mutual funds, as some Legislators stated Tuesday on the House floor. These include private investments, hedge funds and other securities that are available only to large asset owners like us. The ones we identify typically provide exceptional returns with less volatility, but you need to have an accurate analysis.”
Meier explained that opportunities like these are what has helped the Treasurer’s Office outperform industry benchmarks. In fact, over the past five years, the investment team has generated approximately $1.1 billion in excess returns above benchmark through disciplined management of a complex, institutional-grade portfolio that cannot be replicated by individual traders or off-the-shelf mutual funds.

With that in mind, Meier urges the Legislature to reinstate and approve the requested $320,000 that was part of Governor Mark Gordon’s initial budget recommendation.
“The bottom line is it takes money to make money,” Meier said. “If our hands are tied and we cannot perform appropriate due-diligence within a short period of time, many of these opportunities will slip past us and end up with others. It would be a disservice to the citizens of the Cowboy State if we are forced to leave earnings on the table because we are denied the proper resources. The Consensus Revenue Estimating Group (“CREG”) reported in October that Wyoming realized a record $1.86 billion in investment earnings over the past fiscal year. These earnings exceeded returns from severance taxes and federal mineral royalties combined.