HONOLULU (AP) -- Organizers of an annual conference for people who manage more than $3 trillion in public sector pension funds in the U.S. and Canada say a significant number of administrators are skipping this year's meeting in Hawaii to avoid the perception they're wasting money by heading to the island paradise.
Roughly 650 people are coming to this year's weeklong National Conference on Public Employee Retirement Systems, compared with about 1,000 attendees at last year's meeting in New York, executive director Hank Kim said Monday.
Kim says trustees and others from around the country are thinking about "headline risk" — how the trip may be perceived back home.
"They know that economically it makes sense. They realize that this headline risk is silly, but it's something that if they felt they could avoid it, they would avoid the headline risk," Kim told reporters Monday after the conference opened in a ballroom at the Hilton Hawaiian Village in Waikiki, the most popular area for tourists in the state.
The conference represents more than 550 funds in the United States and Canada.
Funds throughout the country have received close scrutiny and criticism from some public officials and news outlets for considering a Hawaii trip at a time when public pension systems are greatly underfunded.
Among those who skipped this year's conference are administrators of the Los Angeles Fire and Police Pensions and the School Employees Retirement System of Ohio.
Beverly Woolridge, chairwoman of the Ohio school pension system's board of trustees, said in a statement last month that the travel issue had become a "major distraction."
The Detroit Free Press reported last week that records obtained through a Freedom of Information Act request showed four trustees from two funds planned to spend $22,000 to take the trip. In response, Detroit Emergency Manager Kevyn Orr is researching whether some of the pension trustees should be fired, the newspaper reported.
Hawaii Gov. Neil Abercrombie defended Hawaii in remarks to open the conference, saying Honolulu is as legitimate a host as any other U.S. city.
"Unfunded liabilities are crippling state and local governments across the country," Abercrombie said. "This is serious business, and Hawaii is a place where serious business is being done, will be done and has been done. I can assure you that."
Abercrombie took on the issue directly during this year's legislative session in Hawaii, asking for at least $200 million over the next two years to draw down the state's unfunded liabilities for employee and retiree health benefits. Lawmakers exceeded his request and set aside $217 million over two years.
The governor told reporters after his speech Monday that Honolulu is economically competitive and that the criticism over the gathering has more to do with Hawaii's reputation as a beach destination than cost comparisons with meetings in other cities.
"It's kind of ironic that because people like the location of Hawaii so much that it becomes an opportunity for some people to say, 'You shouldn't go there,'" Abercrombie said. "I don't think it carries much weight."
Kim said the organization received no criticism last year for holding its meeting in New York, where he said the conference hotel-room rate was significantly higher than this year. Kim said last year's conference cost roughly $1.5 million, while this year's is less than $1 million.
Average hotel prices in Honolulu were $209 per night in 2012, according to an annual Hotel Price Index by Hotels.com that ranked Honolulu as the second most expensive U.S. city for hotels in the country behind New York.
Mel Aaronson, the conference's president, said the meeting is designed to educate trustees and others on new investment strategies, the potential effects of globalization and fiduciary responsibility.
Oskar Garcia can be reached at http://twitter.com/oskargarcia
Associated Press writer Anita Hofschneider contributed to this report.