Bill Text: NY A10039 | 2017-2018 | General Assembly | Introduced
Bill Title: Relates to limitations on investments of public pension funds; prohibits investment and requires divestment of any stocks, debt or other securities of any company engaged in the manufacture of firearms or ammunition.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Introduced - Dead) 2018-03-08 - referred to governmental employees [A10039 Detail]
Download: New_York-2017-A10039-Introduced.html
STATE OF NEW YORK ________________________________________________________________________ 10039 IN ASSEMBLY March 8, 2018 ___________ Introduced by M. of A. O'DONNELL -- read once and referred to the Committee on Governmental Employees AN ACT to amend the retirement and social security law and the education law, in relation to limitations on investments of public pension funds The People of the State of New York, represented in Senate and Assem- bly, do enact as follows: 1 Section 1. Section 423 of the retirement and social security law, as 2 amended by chapter 770 of the laws of 1970, is amended to read as 3 follows: 4 § 423. Investments. [a.] 1. On and after April first, nineteen 5 hundred sixty-seven, the comptroller shall invest the available monies 6 of the common retirement fund in any investments and securities author- 7 ized by law for each retirement system and shall hold such investments 8 in his name as trustee of such fund, notwithstanding any other provision 9 of this chapter. Participating interests in such investments shall be 10 credited to each retirement system in the manner and at the time speci- 11 fied in [paragraph] subdivision two of section four hundred twenty-two 12 of this article. 13 [b.] 2. (a) To assist in the management of the monies of the common 14 retirement fund, the comptroller shall appoint an investment advisory 15 committee consisting of not less than seven members who shall serve for 16 his term of office. A vacancy occurring from any cause other than expi- 17 ration of term shall be filled by the comptroller for the remainder of 18 the term. Each member of the committee shall be experienced in the field 19 of investments and shall have served, or shall be serving, as a senior 20 officer or member of the board of an insurance company, banking corpo- 21 ration or other financial or investment organization authorized to do 22 business in the state of New York. The committee shall advise the comp- 23 troller on investment policies relating to the monies of the common 24 retirement fund and shall review, from time to time, the investment 25 portfolio of the fund and make such recommendations as may be deemed 26 necessary. 27 (b) The comptroller shall appoint a separate mortgage advisory commit- 28 tee, with the advice and consent of the investment advisory committee, 29 to review proposed mortgage and real estate investments by the common 30 retirement fund. In making investments, as authorized by law, the comp- 31 troller shall be guided by policies established by each committee from EXPLANATION--Matter in italics (underscored) is new; matter in brackets [] is old law to be omitted. LBD15013-01-8A. 10039 2 1 time to time; and, in the event the mortgage advisory committee disap- 2 proves a proposed mortgage or real estate investment, such shall not be 3 made. 4 (c) No officer or employee of any state department or agency shall be 5 eligible for membership on either committee. Each committee shall 6 convene periodically on call of the comptroller, or on call of the 7 chairman. The members of each committee shall be entitled to reimburse- 8 ment for their actual and necessary expenses but shall receive no 9 compensation for their services. 10 3. (a) Notwithstanding any provision of law to the contrary, the comp- 11 troller shall not have the power to invest the available monies of the 12 common retirement fund in any stocks, debt or other securities of any 13 corporation or company, or any subsidiary, affiliate or parent of any 14 corporation or company, engaged in the manufacture of firearms, as 15 defined in section 265.00 of the penal law, or ammunition. The comp- 16 troller shall, in accordance with sound investment criteria and consist- 17 ent with his or her fiduciary obligations, divest any such stocks or 18 other securities whether they are owned directly or held through sepa- 19 rate accounts or any commingled funds. Divestment pursuant to this 20 subdivision must be completed within five years of the effective date of 21 this subdivision. 22 (b) The comptroller shall be permitted to cease divesting from compa- 23 nies under paragraph (a) of this subdivision, reinvest in companies from 24 which it divested under paragraph (a) of this subdivision, or continue 25 to invest in companies from which it has not yet divested upon clear and 26 convincing evidence showing that as a direct result of such divestment, 27 the total and aggregate value of all assets under management by, or on 28 behalf of, the common retirement fund becomes or shall become: (i) equal 29 to or less than ninety-nine and one-half percent; or (ii) one hundred 30 percent less fifty basis points of the hypothetical value of all assets 31 under management by, or on behalf of, the common retirement fund assum- 32 ing no divestment from any company had occurred under paragraph (a) of 33 this subdivision. Cessation of divestment, reinvestment or any subse- 34 quent ongoing investment authorized by this section shall be strictly 35 limited to the minimum steps necessary to avoid the contingency set 36 forth in the preceding sentence. For any cessation of divestment, and in 37 advance of such cessation, authorized by this subdivision, the comp- 38 troller shall provide a written report to the attorney general, the 39 senate standing committee on civil service and pensions, and the assem- 40 bly standing committee on governmental employees, updated semi-annually 41 thereafter as applicable, setting forth the reasons and justification, 42 supported by clear and convincing evidence, for its decisions to cease 43 divestment, to reinvest or to remain invested in firearm and ammunition 44 manufacturing companies. 45 (c) Within sixty days of the effective date of this subdivision, the 46 comptroller shall facilitate the identification of firearm and ammuni- 47 tion manufacturing companies from which the common retirement fund is 48 required to divest under paragraph (a) of this subdivision, and file a 49 copy of this list with the attorney general, the senate standing commit- 50 tee on civil service and pensions, and the assembly standing committee 51 on governmental employees. Annually thereafter, the public fund shall 52 file a report with the attorney general, the senate standing committee 53 on civil service and pensions, and the assembly standing committee on 54 governmental employees that includes: (i) all investments sold, 55 redeemed, divested or withdrawn in compliance with paragraph (a) of this 56 subdivision; and (ii) all prohibited investments from which the commonA. 10039 3 1 retirement fund has not yet divested under paragraph (a) of this subdi- 2 vision. 3 § 2. Section 508 of the education law is amended by adding a new 4 subdivision 12 to read as follows: 5 12. (a) Notwithstanding any provision of law to the contrary, the 6 retirement board shall not have the power to invest the available moneys 7 belonging to the retirement system in any stocks, debt or other securi- 8 ties of any corporation or company, or any subsidiary, affiliate or 9 parent of any corporation or company, engaged in the manufacture of 10 firearms, as defined in section 265.00 of the penal law, or ammunition. 11 The retirement board shall, in accordance with sound investment criteria 12 and consistent with its fiduciary obligations, divest any such stocks or 13 other securities whether they are owned directly or held through sepa- 14 rate accounts or any commingled funds. Divestment pursuant to this 15 subdivision must be completed within five years of the effective date of 16 this subdivision. 17 (b) The retirement board shall be permitted to cease divesting from 18 companies under paragraph (a) of this subdivision, reinvest in companies 19 from which it divested under paragraph (a) of this subdivision, or 20 continue to invest in companies from which it has not yet divested upon 21 clear and convincing evidence showing that as a direct result of such 22 divestment, the total and aggregate value of all assets under management 23 by, or on behalf of, the several funds created by this article becomes 24 or shall become: (i) equal to or less than ninety-nine and one-half 25 percent; or (ii) one hundred percent less fifty basis points of the 26 hypothetical value of all assets under management by, or on behalf of, 27 the several funds created by this article assuming no divestment from 28 any company had occurred under paragraph (a) of this subdivision. Cessa- 29 tion of divestment, reinvestment or any subsequent ongoing investment 30 authorized by this section shall be strictly limited to the minimum 31 steps necessary to avoid the contingency set forth in the preceding 32 sentence. For any cessation of divestment, and in advance of such cessa- 33 tion, authorized by this subdivision, the retirement board shall provide 34 a written report to the attorney general, the senate standing committee 35 on civil service and pensions, and the assembly standing committee on 36 governmental employees, updated semi-annually thereafter as applicable, 37 setting forth the reasons and justification, supported by clear and 38 convincing evidence, for its decisions to cease divestment, to reinvest 39 or to remain invested in firearm and ammunition manufacturing companies. 40 (c) Within sixty days of the effective date of this subdivision, the 41 attorney general shall facilitate the identification of firearm and 42 ammunition manufacturing companies from which the several funds created 43 by this article are required to divest under paragraph (a) of this 44 subdivision, and file a copy of this list with the retirement board, the 45 attorney general, the senate standing committee on civil service and 46 pensions, and the assembly standing committee on governmental employees. 47 Annually thereafter, the several funds created by this article shall 48 file a report with the retirement board, the attorney general, the 49 senate standing committee on civil service and pensions, and the assem- 50 bly standing committee on governmental employees that includes: (i) all 51 investments sold, redeemed, divested or withdrawn in compliance with 52 paragraph (a) of this subdivision; and (ii) all prohibited investments 53 from which the common retirement fund has not yet divested under para- 54 graph (a) of this subdivision. 55 § 3. This act shall take effect immediately.
