Despite a noticeable lack of debate or public hearings on the subject, the New York State Legislature is moving towards adoption of a significant change in investment guidelines for the $120 billion Common Retirement Fund, according to a new FiscalWatch Memo issued today by the Manhattan Institute and its Empire Center for New York State Policy.

The so-called "prudent investor bill, supported by Comptroller Alan Hevesi, "doubtless seems arcane to many legislators," the FiscalWatch Memo notes. "But it has far-reaching implications -- including the potential of more complex financial risks for New York taxpayers, who already have been straining under the burden of $1.1 billion in added state and local pension expenses in the last four years.

"It would also invest more power and discretion than ever in the hands of one official--the state comptroller, who is sole trustee of the state and local retirement fund...At the very least, the proposal raises significant questions that deserve more careful consideration and a public airing by the Legislature."

The memo -- entitled "The Biggest Public Pension Investment Policy Shift You've Probably Never Heard Of," was co-authored by two Manhattan Institute senior fellows: Nicole Gelinas, a Chartered Financial Analyst who also is a contributing editor of the Institute's City Journal, and Edmund J. McMahon, who also is director of the Empire Center.