RALEIGH (WTVD) -- One of the biggest and most under-reported problems in the state right now is happening at the state treasury department.As far as pots of money go, the North Carolina Treasury is the big dog in the state by a distance. By one recent ranking , it's the 26th largest pool of public money in the world.And right now, that $110 billion fund is in big trouble."The 28th Treasurer of North Carolina is going to face financial challenges with the pension and the health care plan that the state has never seen before," said Dale Folwell, CPA -- North Carolina's 28th State Treasurer. "It just has to do with the math."Folwell likes when reporters tag that "CPA" on the back of his name. He's a certified public accountant and he says now, more than ever, that means something."The Folwell Administration is going to be focused on not emotion, not politics but mathematics," he said.Here's the problem as Folwell broke it down. The state pension plan - currently about $90 billion - is underfunded by about $15 billion and the state health plan is unfunded (you read that right) by $32 billion."I can tell you that if we don't attack and solve these two particular issues," Folwell said. "The things that your viewers care about, which is the core functions of state government, are going to be impacted."How did the state find itself with a hole that big? Here's how Folwell explained it, at least as it relates to that $32 billion hole in the health plan."As health care costs ballooned and the number of people employed by the state increased as a result of the population increasing, as all of those things have happened, the state health plan is on what's called a "pay-go" basis. When we are presented a bill from a doctor, hospital or pharmacy, we pay that bill, so we're on a pay-go basis. The pay-go is going to require almost 3 billion dollars a year, every year, at least. Starting right now. And that's only going to be increasing," he said.And Folwell said a big problem with an unfunded health plan is that it begins to implode on itself."Beginning teachers, beginning troopers, beginning state employees, who are protecting us from crime, educating our children, and who are involved in the state health plan; they can afford the individual coverage but they can't afford the family premiums. So what's happening is, we're not attracting young, healthy people to the state health plan. And you cannot have an insurance company where you don't have young, healthy people in it," he explained."These two items, just the pension and health care, are going to require over $4 billion a year out of the General Assembly in the next 15 years. Just to fund the health care and pension liability of these two plans," he said.Folwell continued, saying the only way to get there is to raise taxes.He said the first thing, however, is ramping up efficiency."Find ways to cut out waste, fraud and abuse," Folwell said. "Only after I'm satisfied that I've found all I possibly can, then will I be going to the General Assembly and the taxpayers."Folwell said he'll also find the state extra money in reductions to fees paid to Wall Street money managers."The state pension fund last year paid over $500 million in fees to Wall Street to manage the state pension fund," said Folwell.Fees which he says have ballooned from $50 million to $500 million in just the past 15 years."We're going to cut those Wall Street fees by at least 100 million dollars," he offered.A big part of the reason fees have soared is the Treasury's move to put more money in high risk investments, or "alternative funds." Former Treasurer Janet Cowell shifted approximately 40% of investments to these higher risk accounts but, as critics point out, never achieved higher returns on those investments than the state could have gotten in more standard funds.Another area Folwell says he intends to depart from Cowell's administration is transparency. Cowell faced fierce criticism over the secrecy she allowed to surround much of the money in the state pension and health plans. Folwell says that won't happen on his guard."Transparency starts by sitting down with people like you," he said.He committed to calling every money manager holding the state's money and evaluating each relationship individually."I'm going to ask them some general questions. How good are you at what you do? Where is our money? What is your performance relative to your competitors? And how much do you get paid to do it? And we're going to do an accounting of over 180 money managers for the state. We are going to look at everyone who manages money for the state, find out what they do, who they are, and how much they get paid to do it," he said."These issues are critically important for one mathematical reason," Folwell continued. "This whole pension plan is wired to grow at 7.25%. It has not achieved that, on average, over the last 15 years. I think there's less than a 25% chance it's going to earn that over the next 15 years. This is a huge issue going forward. Bill Gates said just a few years ago that the biggest threat to public education over the next few decades, and I'm paraphrasing, is how we account and fund the long term health care for public workers. That's why this matters to average folk."One area Folwell says he won't do things differently from his predecessor, Janet Cowell, is in who holds the reins at the Treasury. North Carolina is one of only a small handful of states that entrust the entire pension and health funds to one person. The Treasurer is the "sole trustee." Most other state's turn to a board to make those same decisions. Folwell said he intends to remain the sole decider at Treasury. Somewhere, he said, for the buck to stop.Annual Report: https://www.nctreasurer.com/inside-the-department/Reports/NCDST_Annual_Report_FY2015-2016.pdf Annual Report Investments Supplement: https://www.nctreasurer.com/inv/Investment%20Reports/Annual_Investment_Report_Supplement_FY2015-2016.pdf Pension Fund Overview: https://www.nctreasurer.com/inv/Pages/Pension-Fund.aspx 2016 Q3 Returns: https://www.nctreasurer.com/inv/Investment%20Reports/NCRS_Quarterly_Update_Q3_2016.pdf