Treasurer Ron Crane says Idaho earned $1B during his tenure, he still disputes audit findings

Associated Press

State Treasurer Ron Crane's office says Idaho has received more than $1 billion in interest earnings since he became treasurer in 1999.

Crane called the accomplishment during his more than 15 years in office a historic milestone for the state.

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"Not one dollar of principal has been lost during my time in office," he said. "I am proud of our record of interest earnings and portfolio gains. $1.1 billion is a lot of money for the benefit of taxpayers in Idaho."

The Republican's announcement, released Thursday, comes after a legislative audit concluded his office lost more than $10 million in an inappropriate money transfer in 2009. Auditors said in January that Crane's office overrode internal controls meant to contain financial risk and made the transfer.

Democrat Deborah Silver, who is running against Crane in this year's election, said he is trying to confuse the issue "by conflating federal interest rates with the activities of his office."

"There is simply no relationship between the two," Silver said Friday. "This number is simply a return of a little less than 3 percent on an average balance of $2.5 billion over 15 years. The total is just a reflection of how long he has been in office."

According to the audit, the $10.2 million loss resulted from investments in mortgage-backed securities hit by the collapse of the 2008 housing bubble. In 2009, Crane thought the investments were still worth their face value of about $31 million when he transferred them to the local government fund, according to the audit issued in January. Instead, their real market value was $10.2 million less.

The January audit also called for more oversight of Crane's office, and a follow-up report said that has been accomplished by the creation of an advisory board during the recent 2014 legislative session. The board will review investments and provide recommendations to Crane.

Crane has repeatedly disputed the audit's findings. He says he has built up the state's credit ratings and secured record-low interest rates for the annual sale of tax anticipation notes, a resource state accountants use to manage cash flow.

Silver said Crane is the only person to rebut the audit.