Underwood touts stock measure

September 18, 1997


Staff Writer, Charles Town

SHEPHERDSTOWN, W.Va. - As West Virginia Gov. Cecil Underwood recently toured the new science center at Shepherd College, he told how much more money would be available if the state did not have to spend nearly $315 million a year on the pension system.

For a while during the recent tour, he made his visit a campaign stop for Amendment 1.

A special statewide election is being held Saturday, Sept. 27 for West Virginians to decide whether or not to allow the state to invest pension funds in the stock market.

Underwood, a Republican, and Del. John Doyle, D-Jefferson, said that allowing the state to put money in the stock market has bipartisan support.


Currently, West Virginia is the only state that does not invest in the stock market, they said.

The state's constitution requires all funds to go into bonds. They said the state constitution was written before the creation of the stock market.

Over the years, the stock market has significantly outperformed bonds, causing most of the state's investments to be eaten up by annual inflation, they said.

Underwood said financial analysts believe the state pension fund would be nearly self-supporting if the money was invested in stocks.

"If this passes, we shouldn't, if I'm correct, ever have to transfer any money again from the general revenue," Underwood said.

Instead, the state had to spend nearly $315 million last year to support the pension funds that 190,000 people depend on for their pensions.

"That's where we could find money for this," he said pointing to the unfinished first floor of the science building's first wing.

The state would invest about 70 percent in stocks and 30 percent in bonds, he said.

The issue is the only vote on the special election ballot.

Doyle said he believes that will help pass the issue.

In other states, residents have usually voted against the issue the first time it is on the ballot in general elections because they do not understand it properly, Doyle said.

But in special elections, usually only informed residents come out to vote on the issue.

An active campaign for the amendment has been waged and Doyle and Underwood said they have not seen any active opposition to the issue.

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