Eyebrows rose in the Twin Cities investment management community this month after the resignation of Teri Richardson, assistant executive director at the Minnesota State Board of Investment. Richardson, 50, was seen as heir apparent to Howard Bicker, 63, the longtime executive director, who is expected to retire at age 65 from the agency that oversees about $58 billion in state worker retirement and other funds.
Bicker declined to comment on the situation other than to say he will address pending matters with his board at the regularly scheduled June meeting. Richardson did not respond to telephone inquiries last week.
Before joining the state investment board in 2008, Richardson managed $13 billion in pension and other assets for the former Northwest Airlines.
The state investment board is a big deal in money management circles because, in addition to being one of the biggest pools of investment funds in Minnesota, Bicker and his staff hire and fire investment managers to whom they parcel out hundreds of millions apiece to invest in stocks, bonds and money market funds.
Bicker, a 41-year-employee who started out as an investment analyst, is paid $245,000, less than most private-sector investment managers, but more than the $120,311 the governor is paid. Bicker is one of several dozen state managers who make more than the governor by legislative exemption to state law.
The combined state pension funds earned an 11.8 percent annualized return over the three-year period that ended Dec. 31. During the past decade, including the market downturn, the combined funds have earned a 5.7 percent annualized return.
Belski at BMO
Brian Belski, the Minnesota-bred equity market strategist who has worked in the Twin Cities and Wall Street, expects the S&P 500 to finish the year at about 1,425 and rise to 1,550 in 2013 as investors emerge from the "lost decade" of the 2000-09 and continue their transition "from fear, emotions and reactions to process and discipline."
Belski, who moved from Oppenheimer & Co. to Bank of Montreal this month, is chief investment strategist of BMO's capital markets group. He will have offices in New York and Toronto.
Belski, in his first report last week, says history, investment fundamentals and sentiment "are on the side of stocks for the next several years," although the near doubling of the S&P 500 over the last three years, following the 2008-09 crash, will give way to the best gains coming from the best-run companies.
In short, corporate America has strong balance sheets, workforces are at record productivity and earnings are high and poised to go higher.
The Belski bias is toward large, dividend-paying growth companies that have not had huge price run-ups in the past couple of years. Minnesota-based Medtronic, Target and Wisconsin-based Harley-Davidson are on the "outperform" lists of BMO analysts.
"Bottom line, we believe tailwinds persist that ultimately will drive U.S. stocks into the next fundamental secular bull market," Belski said. However, he cautions that there will be volatility tied to economic trends and political developments in Washington, D.C., and elsewhere.
OWNERS MAKING MOVES
The new private equity owners of Phillips & Temro Industries aren't wasting any time making changes at the Eden Prairie-based manufacturer.
The company, which makes heating, cooling and silencing products for diesel, gasoline, hybrid and electric vehicle engines, is moving its Winnipeg heating manufacturing and distribution operations to factories in Eden Prairie and China. The move will add 80 employees to the current workforce of 145 in Eden Prairie, according to spokeswoman Mary Ann McCauley.
The move will happen during the next several months. The company will continue to operate a separate silencing products facility in Winnipeg.
In addition to Eden Prairie, Phillips & Temro also has about 40 workers at a Prior Lake plant that makes engine silencing products. The company was acquired in February by Audax Group, a Boston-based investment firm.
Minneapolis-based El Coco Loco Catering (www.elcocolococatering.com), owned by Andrea Macias, and Grooming House Barbershop, owned by Daymn Johnson and Dedrick Young ( www.groominghouse.net) were among 14 finalists in five categories that were honored at the annual awards dinner Saturday night of the Neighborhood Development Center (NDC).
For nearly 20 years, NDC has helped re-create commercial centers in 25 low-income neighborhoods, including the Mercado Central and Midtown Global Market in Minneapolis, and helped train, finance and develop more than 500 resident-owned, small businesses that are still operating and making their communities more prosperous, safer and stronger.
Grooming House is a six-year-old, expanding barbershop that is in the NDC-developed Frogtown Square on University Avenue in St. Paul.
The other finalists include Abdi and Nasra Gonjobe's Metro Nursing Services; MAG Mechanical owned by Michael and Anthony Goze; Helen Miller's Miller Upholstery; Tami Cabrera's Muddy Paws Cheesecake; Isaac Carpenter's Initiative Construction, and Velasquez Family Coffee.
Getting a good return on energy-saving investments is not just the province of residential and commercial building owners. First Unitarian Society, located near the Walker Art Center in Minneapolis, took first place in the "house of worship'' category for the 2011 Environmental Protection Agency "Energy Star Battle of the Buildings" national competition.
Now First Unitarian is showing other Minnesota congregations how they can repay energy-saving improvements within a few years and save thousands annually on utility bills.
The folks at First Unitarian started with a simple "energy-benchmarking" worksheet at www.energystar.gov/benchmarking and discovered nearly two-thirds of churches were more efficient.
An inspection of the church's heating, ventilation and air conditioning systems revealed that it was alternately overheating and overcooling. With the help of a CenterPoint Energy rebate, First Unitarian installed an Internet-accessible controller to program heat and cooling. The improvements raised First Unitarian's energy score and cut gas and electric consumption by 35 percent.