State pension fund chief to retire
© St. Petersburg Times
TALLAHASSEE -- Tom Herndon, the head of the state pension fund while it lost millions on falling Enron stock, announced Thursday that he is retiring after a 32-year career in state government.
Herndon said he will remain as executive director of the state Board of Administration, the agency that handles the state's $96-billion pension fund, for three months while the state looks for his replacement. He is paid $172,000 a year.
Appointed and supported by Republican and Democratic governors, Herndon insisted that the scrutiny of the Enron losses had nothing to do with his decision. The fund's $320-million Enron loss has become the subject of House and Senate investigations.
"I know people will come to that conclusion," he said. "But it's really not because of Enron."
"I didn't feel it was appropriate to be soliciting jobs with other people while I'm still here," Herndon added. "I've been in government for 32 years. I don't regret a single day of it, but it's time for me to do something else."
Despite the Enron loss, Herndon noted that the Florida pension fund continues to be rated as the No. 1 of its size in the country.
The state pension fund totaled about $56-billion when Herndon took the job and now ranges between $96-billion and $97-billion, an increase of about 70 percent since 1996.
"I could take an average return of 14 percent a year for my portfolio and live comfortably," Herndon said.
Herndon said he believes the Enron experience may in the long run be a watershed event in the world of finance.
It is already changing the role of "good old boy" boards and increasing the accountability of auditing and accounting, he said.
"I hope it separates the practice of consulting and auditing," Herndon said. "Everyone is pushing in that direction. You are already seeing organizations as renowned as General Electric disclose more than ever before."
A native of St. Petersburg, Herndon, 56, graduated from St. Petersburg Junior College and the University of South Florida and got his master's degree at Florida State University before taking a job as staff director of a House committee in 1974.
He later became the Tampa Bay region administrator for the state Department of Health and Rehabilitative Services before returning to Tallahassee and accepting a job as staff director for the House Appropriations Committee.
In 1984, Herndon went to work for Gov. Bob Graham and became chief of staff in 1985. Graham appointed him to the Public Service Commission before he left office in 1986. In 1990, Gov. Bob Martinez and the Cabinet asked him to take over as director of a deeply troubled Department of Revenue.
Gov. Lawton Chiles made him chief of staff in his office in 1992, just two weeks before Hurricane Andrew hit South Florida. Herndon remained until 1995, when he left to start a career as a lobbyist.
It didn't last long. A year later, in September 1996, Herndon accepted the $150,000-a-year job managing the state's pension fund.
Herndon said he loved all of his state jobs but thought working as chief of staff for Graham was the toughest.
"He was so demanding to work for," Herndon recalled. "It was difficult to get a decision. He wanted more information all the time and would call in the middle of the night and weekends."
Herndon said he plans to spend some time at a summer home in the North Carolina mountains with his wife, Cathy, and his children and grandchildren in Orlando before finding something else to do.
"I'm too young to retire and live in the mountains full-time, but I don't have any plans yet."
© 2006 • All Rights Reserved • Tampa Bay Times
490 First Avenue South St. Petersburg, FL 33701 727-893-8111
From the Times state desk
From the state wire