Updated at 4:33 p.m.
After nearly a dozen years as Vermont’s state banker and chief investment officer, Treasurer Beth Pearce intends to retire when her term expires in January.
The 68-year-old Barre Democrat had been planning to seek reelection this year, she told VTDigger in an interview Tuesday, but changed her mind about three weeks ago after she was diagnosed with cancer.
“I can’t do my job, run for reelection and do all the treatment I need to do for this. I think I’ve hit the limit,” she said. “I hate it because I love this job. It’s been the most enjoyable — sometimes frustrating — job I’ve had.”
A lifelong public servant, Pearce held top municipal finance jobs before becoming deputy state treasurer in Massachusetts and then Vermont. In December 2010, when then-Treasurer Jeb Spaulding resigned for a job in Gov.-elect Peter Shumlin’s cabinet, Shumlin appointed Pearce to fill out Spaulding’s term.
Though Pearce had never before run for public office, she won a heavily contested race for the job in 2012 and has easily won reelection four times since. A self-described “geek,” Pearce has been a behind-the-scenes player who has never appeared interested in using her post as a springboard to higher office.
“I love working. I love the PowerPoints,” Pearce said Wednesday morning at a press conference in Montpelier’s Pavilion Auditorium during which she formally announced her retirement. “I love the Excel spreadsheets. But I really love the way that you relate those to people and how it makes a difference in people's lives in this state.”
As treasurer, Pearce has overseen an office of roughly 35 people investing state funds, managing debt and cash flow, issuing bonds and administering three public pension systems — for state employees, educators and municipal workers. The pension systems serve roughly 58,000 people and include more than $5.7 billion in assets.
In a typical year, according to Pearce, her office oversees the flow of roughly $7.2 billion in non-pension funds and has $320 million in hand at any given time. Thanks to an influx of federal aid in recent years, her office is currently sitting on more than $1.6 billion.
Pearce has spent much of her tenure as treasurer warning about the pension system’s unfunded liabilities, and she has consistently won the support of Vermont’s major public-sector labor unions for doggedly defending state pensions from efforts to shift workers over to 401(k)-style retirement plans.
“Beth’s retirement and the prospect of losing her from the public dialogue around how we defend our public employee pension system is really a sad thought,” said Rep. Sarah Copeland Hanzas, D-Bradford, who co-chaired a task force that wrote the blueprint for a pension reform effort this year. “She has been steadfast in her support of public employee pensions.”
Pearce butted heads with her allies in labor last year when she proposed a series of deep cuts to the retirement system. At the time, she characterized her recommendations as an effort to save the pensions — both from insolvency and from those who would prefer to jettison “defined benefit” retirement plans entirely in favor of “defined contribution” plans.
Defined benefit plans, such as pensions, guarantee employees a particular benefit upon retirement. Defined contribution plans, like 401(k)s, do not.
Though lawmakers did not ultimately adopt all of Pearce’s recommendations, they passed their own compromise reforms with S.286 this year. The bill would see both workers and the state pay more into the system, and it would also achieve a long-sought goal for the treasurer: pre-funding the system that pays for retiree health benefits.
Gov. Phil Scott vetoed the bill on Monday, arguing that employees should be given the option to opt out of the pension system in favor of a defined contribution plan. The Senate unanimously overrode Scott’s veto on Wednesday — the same day, incidentally, in which Pearce announced that she would step down. The House is expected to attempt an override Friday.
In his own statement Wednesday, Scott called Pearce “a steadfast public servant, deeply committed to Vermont.”
“For the past twelve years, serving together as statewide officials, I have enjoyed our (collaborative) relationship. Regardless of our differences, we have worked together well on several issues,” he said.
“I don’t know if Vermonters appreciate how valuable a contribution Beth Pearce made and how we relied on her to get us out of very difficult situations,” Vermont State Employees’ Association executive director Steve Howard said Wednesday. “Even when we didn’t agree, she treated us with respect. And she was constantly trying to find common ground.”
No candidates have yet declared their intentions to run for treasurer, and Pearce has not yet endorsed a potential successor, although she said Wednesday that she might be “whispering in somebody’s ear.” She also made clear what her litmus test would be — and in so doing, hinted at what is likely to become a top campaign issue.
“There is unfinished business. And I will tell you that I will support a person for treasurer that defends defined benefit programs,” she said. “That's the way to go. And that's important to me. I know that's important to the public employees.”
With her decision to step down, Pearce becomes the fifth of nine statewide officeholders in Vermont to announce they won’t seek reelection — either because they are retiring or seeking higher office — setting up the most competitive election cycle in years. Others relinquishing their current posts include U.S. Sen. Patrick Leahy, U.S. Rep. Peter Welch, Lt. Gov. Molly Gray and Secretary of State Jim Condos.
Pearce told VTDigger she has been particularly proud of her efforts to improve the state’s cash management, enhance its financial reporting, return unclaimed property and help lawmakers tackle thorny policy questions, such as how to finance clean water improvements.
“I can go back to every position I’ve been in and can see some good that has come out of those — and that is an absolutely terrific feeling,” she said. “I’m proud of my record and can look in the mirror and know that I’ve done the right thing.”
Pearce, who has faced several other health challenges in recent years, said her experience in the health care system has reinforced her view that it has to change to better serve those less privileged than she is.
“There are inequities in the health system that do not fairly treat people with low income, that are marginalized in many different ways and that do not have access to the same preventive services that others have,” she said. “I have a good health care program. My cancer was discovered early, which gives you a higher probability of a good outcome — and, frankly, I’m expecting a good outcome.”
Correction: Earlier versions of the photo captions in this story misspelled Beth Pearce's surname.
Missing out on the latest scoop? Sign up for Final Reading for a rundown on the day's news in the Legislature.