By Representative Cabral of New Bedford and Senator Menard, joint petition (accompanied by bill, House, No. 4270) of Antonio F. D. Cabral and others for legislation to regulate the investment of public pension funds in certain companies doing business in the countries of Iran and South Africaca. Public Service.

 

The Commonwealth of Massachusetts

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PETITION OF:

 


Antonio F. D. Cabral

Joan M. Menard

Richard R. Tisei

Bradley H. Jones, Jr.

Stephen R. Canessa

William N. Brownsberger

Barry R. Finegold

Louis L. Kafka

Patricia A. Haddad

Cleon H. Turner

Elizabeth A. Poirier

Timothy J. Toomey, Jr.

Susan Williams Gifford

Michael E. Festa

John J. Binienda

Cory Atkins

Lewis G. Evangelidis

Mary S. Rogeness

Michael F. Rush

Pam Richardson

Marie P. St. Fleur

James J. O'Day

David Paul Linsky

Peter V. Kocot

Demetrius J. Atsalis

Peter J. Koutoujian

Martin J. Walsh

Daniel K. Webster

Angelo M. Scaccia

Kevin G. Honan

Jeffrey Sanchez

James B. Eldridge

Rosemary Sandlin

Charles A. Murphy

Karyn E. Polito

John W. Scibak

John D. Keenan

Viriato Manuel deMacedo

Mark V. Falzone

Paul Kujawski

Tom Sannicandro

Richard J. Ross

Anthony J. Verga

Michael J. Moran

Steven M. Walsh

Douglas W. Petersen

Scott P. Brown

Michael R. Knapik

Mark C. Montigny

Edward M. Augustus, Jr.

Brian A. Joyce

Mark R. Pacheco

Susan C. Tucker

Dianne Wilkerson

Thomas M. McGee

Gloria L. Fox

Bruce E. Tarr

Joyce A. Spiliotis

Bradford Hill

 

 


 

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In the Year Two Thousand and Seven.

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An Act to protect the Massachusetts Pension Fund from the risks of investment in Iran.

 

Be it enacted by the Senate and House of Representatives in General Court assembled, and by the authority of the same, as follows:


 

AN ACT TO PROTECT THE MASSACHUSETTS PENSION FUND FROM THE RISKS OF INVESTMENT IN IRAN

 

SECTION 1. Paragraph (h) of subsection 2A of Section 23 of Chapter 32 of the General Laws, as amended by Chapter 119 of the Acts of 1997, is hereby further amended by deleting the following:

 

that no investment of funds shall be made in any bank or financial institution which directly or indirectly or through any subsidiary has outstanding loans to any individual corporation engaged in the manufacture, distribution or sale of firearms, munitions, including rubber or plastic bullets, tear gas, armored vehicles, or military aircraft for use of development in any activity in South Africa, and no new investment of funds shall be made in the stocks, securities or other obligations of any company so engaged; provided, further, that if the board elects to invest in banks, financial institutions or any companies doing business in South Africa, excluding the aforementioned, the board shall review the platform of guiding principles defined in subdivision (5) and monies shall be invested as much as reasonably possible in such banks, financial institutions or companies which have adopted said platform of guiding principles so long as such use is consistent with sound investment policy; and provided, further, that no funds are to be invested in any bank or financial institution which directly or through any subsidiary has outstanding loans to any individual corporation engaged in the manufacture, distribution or sale of firearms, munitions, including rubber or plastic bullets, tear gas, armored vehicles, or military aircraft for use or deployment in any activity in Northern Ireland, and no assets shall be invested in the stocks, securities or other obligations of any such company so engaged.

 

SECTION 2. Paragraph (h) of subsection 2A of Section 23 of Chapter 32 of the General Laws, as amended by Chapter 119 of the Acts of 1997, is hereby further amended by inserting in line 363 after the word 吐urther the following:

 

that no funds shall be directly invested, which for the purposes of this paragraph shall mean invested in holdings directly managed by the PRIM board or administered by a contracted manager in separately managed accounts, in the securities of prohibited companies, which for the purposes of this paragraph shall include any company, corporation, partnership, limited liability company or other business entity, including any wholly or majority owned subsidiary or parent company, that provides goods or services deployed to develop petroleum resources in Iran, including but not limited to acquiring, developing, maintaining, owning, selling, possessing, leasing or operating equipment, facilities, personnel, products, services, personal property, real property or other apparatus of business or commerce, except for the mere holding or renewal of rights to property not presently deployed to develop petroleum and natural gas resources in Iran, and has, with actual knowledge, on or after August 5, 1996, made an investment in Iran of twenty million dollars or more or any combination of investments of at least ten million dollars each which in the aggregate equals or exceeds twenty million dollars in any twelve month period which directly or significantly contributes to the enhancement of Iran痴 ability to develop its petroleum and natural gas resources. Every ninety days, the PRIM board shall make its best efforts to identify all such prohibited companies in which the PRIT fund has direct or indirect ownership or in which the PRIT fund could have such holdings in the future and shall provide a copy of this list of companies to the clerk of the house and to the clerk of the senate. The identification of such prohibited companies shall be the responsibility of an independent, third-party research firm, as identified by the PRIM board. Within thirty days after the first such list is compiled, the PRIM board may send written notice to any such prohibited company whose securities are directly invested by the PRIT fund, with a copy to the clerk of the house and to the clerk of the senate, containing a copy of this act and stating the PRIM board痴 intention to sell that company痴 securities in compliance herewith unless the company replies within ninety days by written notice of the company痴 intention to cease to own or operate such investments within one year and to make no further investments described herein. During such one year period, this paragraph痴 prohibition on ownership shall not apply to the securities of companies that provide timely notice of such intentions. This paragraph痴 prohibition on ownership shall not apply to investments held in an actively managed investment fund, which for the purposes of this paragraph shall mean an account or fund, such as a mutual fund, managed by one or more persons not employed by the PRIM board in which the PRIT fund owns shares or interests together with other investors, except that, within 120 days of the effective date hereof and quarterly thereafter, the PRIM board shall submit letters to the managers of any such actively managed investment funds which own the securities of prohibited companies requesting that the fund consider removing the securities of prohibited companies from the fund or create a similar actively managed investment fund devoid of securities of prohibited companies. If the manager creates a similar fund devoid of such securities, the PRIM board shall determine within six months of such a fund痴 creation, whether to replace all applicable investments in said actively managed investment fund with investments in the newly created fund in a timely manner and consistent with prudent investing standards. A company the United States government affirmatively declares to be excluded from its present or any future federal sanctions regime relating to Iran is not subject to this paragraph痴 divestment requirements or ownership prohibition. The provisions of this paragraph shall expire if and when: the President of the United States affirmatively and unambiguously states, by means including, but not limited to, enacted legislation, executive order or written certification from the President to Congress, that the government of Iran has ceased to acquire weapons of mass destruction and support international terrorism; the United States revokes all sanctions imposed against the government of Iran; or the Congress or President of the United States affirmatively and unambiguously declares, by means including, but not limited to, enacted legislation, executive order or written certification from the President to Congress, that mandatory divestment of the type provided for in this paragraph interferes with the conduct of United States foreign policy.

 

SECTION 3. The PRIM board may vote to spread the sale of securities, ownership of which is prohibited by this act, over no more than twelve months from the effective date hereof and shall file with the clerk of the house and clerk of the senate a report listing any such securities sold pursuant hereto.