The agency that manages Wisconsin's pension fund has tightened its travel policy to discourage employees from taking expensive business-class flights, a practice that had become routine in recent years.
State of Wisconsin Investment Board records show that on 21 trips from 2007 to March 2009, board employees spent more on overseas airfare so they could fly in comfort. The upgrades to business class from coach frequently included multi-course meals, Internet access, more entertainment and beds, often at great expense.
The board does not track how much could have been saved if its employees flew coach, which is recommended with few exceptions under state travel rules. But on four flights where such information is available, employees spent at least three times as much to fly business class instead of coach, or nearly $24,000 more.
_ A managing analyst who spent $7,288 flying to Paris for business meetings in March, instead of $2,243 for coach.
_ Another analyst who spent $7,641 flying to an agriculture conference in Brazil last year, instead of $1,500 for coach.
_ Two employees who spent a total of $18,309 on separate trips for meetings in London last year, instead of $5,602 for coach.
The upgrades to business class came to a halt in April, when the investment board clamped down on them just as they were coming under scrutiny by legislative auditors.
The agency now requires employees to fly coach for all flights that are less than 14 hours, "except in unusual circumstances" when approved by the chief operating officer. Since the policy change, no business-class flights have been approved, board spokeswoman Vicki Hearing said Tuesday.
Hearing said the business-class upgrades were approved when employees were scheduled to arrive on the same day as a meeting so they could be rested. But she said the policy was changed because business class had become increasingly expensive compared with coach in recent years.
"We recognized that gap was very wide," Hearing said. She added that the agency learned it often would be much cheaper for employees to stay overnight an extra day rather than pay for business-class accommodations.
The change came as the Legislative Audit Bureau was questioning the costs of some flights during a review of state credit card use. An audit report released in September questioned five business-class airfare tickets that cost the agency a total of $48,226.
"We question this travel policy because the cost of upgraded airfare typically exceeded the cost of an additional night's lodging by a significant amount," auditors wrote.
Hearing defended the trips, which took employees to London, Switzerland, Sweden, Japan, Spain, Germany and elsewhere. She said the employees who traveled manage a combined $8.1 billion in pension funds in investments in more than 20 countries, and the trips were necessary so they could meet with asset managers and perform due diligence on investments.
Still, the trips are another example of the investment board being out of step with the rest of state government, which has been cutting travel costs for years to save money. The board's executive director has refused to furlough employees for 8 days this year, which Gov. Jim Doyle has ordered for all state employees to balance the budget.
The trustees who manage the agency also awarded fund managers $1.7 million in bonuses in September but will defer the payments until 2011. The bonuses were awarded for their performance in 2008 despite the loss of billions of dollars in pension funds as the global economy crashed.