S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                  3712--A
 
                        2017-2018 Regular Sessions
 
                           I N  A S S E M B L Y
 
                             January 30, 2017
                                ___________
 
 Introduced  by  M.  of A. ORTIZ, MOSLEY, FAHY, SIMON, THIELE, GOTTFRIED,
   SEAWRIGHT, O'DONNELL,  STECK,  ENGLEBRIGHT,  HARRIS,  CARROLL,  GLICK,
   COLTON,  BLAKE,  NIOU,  JAFFEE,  RIVERA, DAVILA, RODRIGUEZ, ZEBROWSKI,
   BARRON -- Multi-Sponsored by --  M.  of  A.  COOK  --  read  once  and
   referred  to the Committee on Governmental Employees -- recommitted to
   the Committee on Governmental Employees in  accordance  with  Assembly
   Rule  3,  sec.  2  --  committee  discharged,  bill  amended,  ordered
   reprinted as amended and recommitted to said committee
 
 AN ACT to amend the retirement and social security 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:
 
   Section 1. This act shall be known and may be  cited  as  the  "fossil
 fuel divestment act".
   § 2. Section 423 of the retirement and social security law, as amended
 by chapter 770 of the laws of 1970, is amended to read as follows:
   §  423.  Investments.    [a.]  1.  On  and after April first, nineteen
 hundred sixty-seven, the comptroller shall invest the  available  monies
 of  the common retirement fund in any investments and securities author-
 ized by law for each retirement system and shall hold  such  investments
 in his name as trustee of such fund, notwithstanding any other provision
 of  this  chapter.  Participating interests in such investments shall be
 credited to each retirement system in the manner and at the time  speci-
 fied  in  [paragraph] SUBDIVISION two of section four hundred twenty-two
 of this article.
   [b.] 2. (A) To assist in the management of the monies  of  the  common
 retirement  fund,  the  comptroller shall appoint an investment advisory
 committee consisting of not less than seven members who shall serve  for
 his  term of office. A vacancy occurring from any cause other than expi-
 ration of term shall be filled by the comptroller for the  remainder  of
 the term. Each member of the committee shall be experienced in the field
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
              

                                                            LBD05953-03-8

 A. 3712--A                          2
 
 of  investments  and shall have served, or shall be serving, as a senior
 officer or member of the board of an insurance company,  banking  corpo-
 ration  or  other  financial or investment organization authorized to do
 business  in the state of New York. The committee shall advise the comp-
 troller on investment policies relating to  the  monies  of  the  common
 retirement  fund  and  shall  review,  from time to time, the investment
 portfolio of the fund and make such recommendations  as  may  be  deemed
 necessary.
   (B) The comptroller shall appoint a separate mortgage advisory commit-
 tee,  with  the advice and consent of the investment advisory committee,
 to review proposed mortgage and real estate investments  by  the  common
 retirement  fund. In making investments, as authorized by law, the comp-
 troller shall be guided by policies established by each  committee  from
 time  to  time; and, in the event the mortgage advisory committee disap-
 proves a proposed mortgage or real estate investment, such shall not  be
 made.
   (C)  No officer or employee of any state department or agency shall be
 eligible for  membership  on  either  committee.  Each  committee  shall
 convene  periodically  on  call  of  the  comptroller, or on call of the
 chairman. The members of each committee shall be entitled to  reimburse-
 ment  for  their  actual  and  necessary  expenses  but shall receive no
 compensation for their services.
   3. (A) NOTWITHSTANDING ANY PROVISION OF LAW TO THE CONTRARY, THE COMP-
 TROLLER SHALL NOT HAVE THE POWER TO INVEST THE AVAILABLE MONIES  OF  THE
 COMMON  RETIREMENT  FUND  IN ANY STOCKS, DEBT OR OTHER SECURITIES OF ANY
 CORPORATION OR COMPANY, OR ANY SUBSIDIARY, AFFILIATE OR  PARENT  OF  ANY
 CORPORATION  OR  COMPANY,  AMONG THE TWO HUNDRED LARGEST PUBLICLY TRADED
 FOSSIL FUEL COMPANIES, AS ESTABLISHED BY CARBON CONTENT  IN  THE  COMPA-
 NIES'  PROVEN  OIL,  GAS  AND  COAL  RESERVES. THE COMPTROLLER SHALL, IN
 ACCORDANCE WITH SOUND INVESTMENT CRITERIA AND CONSISTENT WITH HIS OR HER
 FIDUCIARY OBLIGATIONS, DIVEST ANY SUCH STOCKS OR OTHER SECURITIES WHETH-
 ER THEY ARE OWNED DIRECTLY OR HELD  THROUGH  SEPARATE  ACCOUNTS  OR  ANY
 COMMINGLED  FUNDS.  DIVESTMENT  PURSUANT  TO  THIS  SUBDIVISION  MUST BE
 COMPLETED WITHIN FIVE YEARS OF THE EFFECTIVE DATE OF  THIS  SUBDIVISION,
 WITH  THE  EXCEPTION  OF  COMPANIES ENGAGED IN THE MINING, EXTRACTION OR
 PRODUCTION OF COAL, DIVESTMENT FROM WHICH MUST  BE  COMPLETED  NO  LATER
 THAN ONE YEAR AFTER THE EFFECTIVE DATE OF THIS SUBDIVISION.
   (B)  THE COMPTROLLER SHALL BE PERMITTED TO CEASE DIVESTING FROM COMPA-
 NIES UNDER PARAGRAPH (A) OF THIS SUBDIVISION, REINVEST IN COMPANIES FROM
 WHICH IT DIVESTED UNDER PARAGRAPH (A) OF THIS SUBDIVISION,  OR  CONTINUE
 TO INVEST IN COMPANIES FROM WHICH IT HAS NOT YET DIVESTED UPON CLEAR AND
 CONVINCING  EVIDENCE SHOWING THAT AS A DIRECT RESULT OF SUCH DIVESTMENT,
 THE TOTAL AND AGGREGATE VALUE OF ALL ASSETS UNDER MANAGEMENT BY,  OR  ON
 BEHALF OF, THE COMMON RETIREMENT FUND BECOMES OR SHALL BECOME: (I) EQUAL
 TO  OR  LESS  THAN NINETY-NINE AND ONE-HALF PERCENT; OR (II) ONE HUNDRED
 PERCENT LESS FIFTY BASIS POINTS OF THE HYPOTHETICAL VALUE OF ALL  ASSETS
 UNDER  MANAGEMENT BY, OR ON BEHALF OF, THE COMMON RETIREMENT FUND ASSUM-
 ING NO DIVESTMENT FROM ANY COMPANY HAD OCCURRED UNDER SAID PARAGRAPH (A)
 OF THIS SUBDIVISION.   CESSATION  OF  DIVESTMENT,  REINVESTMENT  OR  ANY
 SUBSEQUENT  ONGOING  INVESTMENT  AUTHORIZED  BY  THIS  SECTION  SHALL BE
 STRICTLY LIMITED TO THE MINIMUM STEPS NECESSARY TO AVOID THE CONTINGENCY
 SET FORTH IN THE PRECEDING SENTENCE. FOR ANY  CESSATION  OF  DIVESTMENT,
 AND  IN  ADVANCE  OF SUCH CESSATION, AUTHORIZED BY THIS SUBDIVISION, THE
 COMPTROLLER SHALL PROVIDE A WRITTEN REPORT TO THE ATTORNEY GENERAL,  THE
 SENATE  STANDING COMMITTEE ON CIVIL SERVICE AND PENSIONS, AND THE ASSEM-
 BLY STANDING COMMITTEE ON GOVERNMENTAL EMPLOYEES, UPDATED  SEMI-ANNUALLY

 A. 3712--A                          3
 
 THEREAFTER  AS  APPLICABLE, SETTING FORTH THE REASONS AND JUSTIFICATION,
 SUPPORTED BY CLEAR AND CONVINCING EVIDENCE, FOR ITS DECISIONS  TO  CEASE
 DIVESTMENT, TO REINVEST OR TO REMAIN INVESTED IN FOSSIL FUEL COMPANIES.
   (C)  WITHIN  SIXTY DAYS OF THE EFFECTIVE DATE OF THIS SUBDIVISION, THE
 COMPTROLLER SHALL FACILITATE THE IDENTIFICATION OF FOSSIL FUEL COMPANIES
 FROM WHICH THE COMMON RETIREMENT FUND IS REQUIRED TO DIVEST UNDER  PARA-
 GRAPH  (A)  OF  THIS  SUBDIVISION, AND FILE A COPY OF THIS LIST WITH THE
 ATTORNEY GENERAL, THE SENATE STANDING COMMITTEE  ON  CIVIL  SERVICE  AND
 PENSIONS, AND THE ASSEMBLY STANDING COMMITTEE ON GOVERNMENTAL EMPLOYEES.
 ANNUALLY THEREAFTER, THE PUBLIC FUND SHALL FILE A REPORT WITH THE ATTOR-
 NEY  GENERAL,  THE  SENATE  STANDING  COMMITTEE  ON  CIVIL  SERVICE  AND
 PENSIONS, AND THE ASSEMBLY STANDING COMMITTEE ON GOVERNMENTAL  EMPLOYEES
 THAT INCLUDES: (I) ALL INVESTMENTS SOLD, REDEEMED, DIVESTED OR WITHDRAWN
 IN  COMPLIANCE  WITH  PARAGRAPH  (A)  OF  THIS SUBDIVISION; AND (II) ALL
 PROHIBITED INVESTMENTS FROM WHICH THE COMMON RETIREMENT FUND HAS NOT YET
 DIVESTED UNDER PARAGRAPH (A) OF THIS SUBDIVISION.
   § 3. This act shall take effect immediately.