The contest for state treasurer Nov. 3 is between the same two major-party candidates who ran four years ago.
But there are differences in this year's race between Democrat Tobias Read of Beaverton and Republican Jeff Gudman of Lake Oswego, aside from the presence of two minor-party candidates.
Read edged Gudman in 2016, 44% to 41.6%. Chris Telfer, the Independent Party nominee and a former Republican state senator from Bend, won 9.5%.
Gudman has Telfer's endorsement this year — and criticism of Read's record as treasurer.
Read, 45, was a state representative for a decade until he was elected treasurer. He once worked at the U.S. Treasury and at Nike.
Gudman, 66, was on the Lake Oswego City Council from 2011 to 2019. He is a financial analyst and investor.
Also on the ballot are Chris Henry — a truck driver from Portland who is the nominee of the Independent, Pacific Green and Progressive parties, and who won 4.9% of the vote for treasurer in 2016 — and Michael Marsh, a maintenance worker from Salem and the nominee of the Constitution Party in 2008, 2010 and 2012. Henry favors a state bank.
No incumbent treasurer has lost since 1964, when Republican Howard Belton lost to Democrat Bob Straub.
The treasurer oversees banking functions for state government, invests around $100 billion — most of it for the Public Employees Retirement System (PERS) — and sits on the State Land Board and other panels. The office also manages state debt and the issuance of bonds.
Gudman assailed Read for not being more active in trying to resolve Oregon's huge unfunded liability for its public-pension system — estimated at $24 billion at the end of 2019 — and in failing to advocate the use of a state windfall from 2017 federal tax cuts to reduce that liability.
"You cannot look at the financial situation of the state without addressing PERS and the challenges it brings," Gudman said during an Oct. 21 debate sponsored by the City Club of Portland and moderated by John Schrag, Pamplin Media Group executive editor.
"Mr. Read chooses to run away from these tough issues. I won't."
But when Gudman said that as treasurer, he would bring all the interests together to come up with recommendations for the Legislature, Read replied: "What I heard in that answer was a lot of nonspecifics about PERS."
The treasurer is not a member of the PERS board. The treasurer is one of five voting members of the Oregon Investment Council, which oversees investment earnings on PERS and other funds. The others are appointed by the governor; the PERS director is a nonvoting member.
Billions in investments
In July the PERS fund was at $78.6 billion, down from $82 billion last December, but up from $75.6 billion in March at the start of the economic downturn triggered by business shutdowns from the coronavirus pandemic.
Investment returns account for about 70% of the benefits paid out to public retirees. The rest comes from contributions from current workers and their government employers.
"When we generate a dollar in investment returns, it's a dollar that doesn't have to come from elsewhere in the budget," Read said.
"My job as treasurer is generating returns. That's what we do. I think we risk making the problem worse if we get distracted from that mission at the Treasury."
Under a policy drawn up by his immediate predecessor as treasurer but which got its first real test with the initial stock market decline at the outset of the pandemic, Read said the fund is forgoing maximum growth (and losses) in favor of a more even approach. He also is continuing Ted Wheeler's shift of some state investment work from out-of-state firms to in-house staff.
Oregon manages one of the nation's largest public-pension investment funds, plus smaller investments for the Common School Fund and the State Accident Insurance Fund.
"I think it is important to have somebody doing the job who is diligent, clear about our state's values and understands the advantage of being an active and significant investor in the marketplace," Read said. "It is why we need someone at Treasury who is not trying to grab headlines; rather, someone who is diligent and thoughtful."
Gudman said the treasurer should be doing more to prepare for a prolonged economic downturn resulting from the pandemic.
"It's sort of like the navigator on the Titanic saying his job does not include looking for icebergs," he said. "The iceberg is out there."
He said he agreed with Read that financial markets will recover, as they did after the Great Recession, when the Oregon PERS fund lost 28% of its value between the end of 2007 and when it hit bottom in March 2009. Full recovery from the recession finally took place in 2013.
"But those are platitudes," Gudman said. "Those are not specific actions that will take us forward."
Gudman points to his record of developing a financing plan for a new Lake Oswego city hall and police station that requires no new taxes. The treasurer is in charge of bond sales for public works projects; Gudman says he wants to be more active in setting priorities for them.
Land Board role
Along with the governor and the secretary of state, the treasurer sits on the State Land Board, which the Oregon Constitution created to oversee the management of state lands. One of the largest chunks is the Elliott State Forest on the south coast, which has posed a challenge between a state mandate to maximize returns for the Common School Fund and federal and state requirements to protect the environment and forest habitat.
The board had been considering selling the forest. Instead, the Department of State Lands is crafting a plan for a research forest overseen by Oregon State University. The board will get its first look on Dec. 8.
"I took a leadership role and tried to craft a new path," Read said. "I am excited about the path we forged."
Gudman said the board should be expanded to five members to allow for greater diversity — a constitutional amendment by voters is required — "and it is also time to re-examine what is the core function of the board."
As the incumbent, Read has raised about four times as much as Gudman, counting 2018 and 2019 contributions that let Read amass more than $800,000. Unions have given Read $110,000, but $155,000 has come from eight out-of-state lawyers and law firms seeking to represent Oregon when the state goes to court for complex financial litigation.
Gudman has questioned such contributions. Read said the attorney general, not he, is the final decider on hiring such firms.
Gudman has pledged he will not seek higher office. No Republican has been elected treasurer since 1988.
"I do not want to be governor," he said. "Mr. Read has been running for governor since the day he took office in the Legislature."
Only one former treasurer, Democrat Bob Straub, has been elected governor in recent times — and that was in 1974, after Straub ran twice before (and lost) while he was still treasurer.
Though Read has not disavowed interest, he has been silent on his plans after the departure of Democratic Gov. Kate Brown, who is barred from reelection in 2022. Read cannot seek a third consecutive term as treasurer.
"I was not raised to be flashy and I do not naturally seek the spotlight," Read said. "In fact, I still think it is possible to do well by doing good. That is where I choose to focus my work in the long run."
Link to the City Club of Portland debate on Oct. 21 (go to the last entry on the web page):
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