During the MTD Executive Board meeting on February 19, Michael Stotz, president and managing director of the AFL-CIO Investment Trust Corporation, presented a comprehensive breakdown of the many ways the AFL-CIO family of funds pays off, for both investors and rank-and-file union members.
Stotz covered three programs: the AFL-CIO Building Investment Trust (BIT), the AFL-CIO Equity Index Fund, and the AFL-CIO Housing Investment Trust (HIT). Each helps out union members in very different but equally important aspects of their lives, he said.
The BIT is a financial program that makes real estate investments to generate competitive income and long-term capital appreciation, while protecting investors’ capital and providing retirement security for union members. The BIT accomplishes this while simultaneously creating new union jobs throughout the country.
Stotz noted, “Since the recession, the BIT has invested in 15 projects across America, totaling over $1.6 billion in new development costs. It is estimated that these projects collectively will create 16.1 million hours of union construction work by completion. Additionally, BIT projects, once completed, are maintained and serviced by the union, creating long-lasting union jobs.”
The AFL-CIO Equity Index Fund is a collective investment program available to qualified pension plans. The objective of the fund is to track the returns of the broad U.S. large cap equity market, as represented by the S&P 500 Index. Stocks in the fund’s portfolio are not actively traded, resulting in low fees and expenses.
“The fund is a critical vehicle for us to strengthen shareholder activism and proxy voting in labor’s interest,” Stotz stated. “Any qualified pension plan that mandates the S&P 500 Index should be choosing the AFL-CIO Equity Index Fund, to improve the lives of the middle class and support union workers.”
The HIT, an open-end, commingled investment company, commonly called a mutual fund, is one of the best examples of how the AFL-CIO uses union dollars to create more union jobs, according to Stotz: “Since its creation, the HIT has invested in 411 projects, which amounts to approximately $8.5 billion in 2014 dollars. This investment of union capital has created a total of 74,131 union construction jobs, and an incredible 149.2 million hours of work.”
He concluded, “Let me just say that this is our time. The labor movement is united in support of putting our union pension dollars to work for our members, retirees and their families. The AFL-CIO Building Investment Trust, the AFL-CIO Housing Investment Trust and the AFL-CIO Equity Index Fund are some of the best tools we have to reinvigorate the economy and advance the interests of workers and their unions.”