The North Dakota State Investment Board has proposed nearly $1.258 million in bonuses for twelve employees of the Retirement and Investment Office (RIO) in recognition of their exceptional management of the state’s significant assets. This decision follows the achievement of more than $191 million in excess returns during fiscal year 2025, representing an impressive return of 0.66% on the state’s $26 billion asset pool.
Executive Director Jodi Smith has faced criticism from various commentators questioning the appropriateness of allocating state funds for bonuses instead of directing them towards public services. Critics have drawn parallels to performance bonuses awarded during recent legislative sessions, suggesting that the financial rewards for RIO employees are unwarranted.
While it is common for government employees to be viewed as expenses, RIO operates under a different model. Employees within RIO generate revenue, contrasting with typical state employees whose salaries are funded by taxpayer contributions. The work undertaken by these twelve individuals is crucial; they are responsible for managing billions of dollars amid a complex financial landscape characterized by changing regulations, political shifts, and economic uncertainties.
The remarkable achievement of generating $191 million in excess returns is significant, particularly when compared to the performance of South Dakota’s equivalent office, which reported a decline of 7% against its benchmark for fiscal year 2025. Such a loss would translate to approximately $1.82 billion in lost assets for North Dakota, highlighting the importance of effective investment strategies.
As North Dakota seeks to attract and retain top investment talent, it is essential to offer competitive salaries and performance-based incentives. The success of the state’s investments is contingent on the expertise of its investors, and maintaining a high-caliber team is vital for continued financial health.
In conclusion, the proposed bonuses reflect the valuable contributions of RIO employees in navigating the complexities of investment management. The ability to reward performance not only recognizes individual efforts but also positions North Dakota favorably in the competitive landscape of public investment management.
The perspectives shared in this article reflect the views of Reed Johnson from Grand Forks and do not represent any official endorsement from associated agencies or employers.
