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 Public 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.