SB 145 Text

Senate Bill No. 145
(By Senator White)
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[Introduced February 11, 2009; referred to the Committee Pensions; and then to the Committee on Finance.]
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A BILL to amend and reenact §12-6-2 of the Code of West Virginia, 1931, as amended; to amend said code by adding thereto two new sections, designated §12-6-12a and §12-6-12b; to amend and reenact §12-6C-3 of said code; and to amend said code by adding thereto two new sections, designated §12-6C-9a and §12-6C-9b, all relating to the divestiture of state moneys from companies that do business in countries that sponsor or promote terrorist activities.

Be it enacted by the Legislature of West Virginia:
That §12-6-2 of the Code of West Virginia, 1931, as amended, be amended and reenacted; that said code be amended by adding thereto two new sections, designated §12-6-12a and §12-6-12b; that §12-6C-3 of said code be amended and reenacted; and that said code be amended by adding thereto two new sections, designated §12-6C-9a and §12-6C-9b, all to read as follows:
ARTICLE 6. WEST VIRGINIA INVESTMENT MANAGEMENT BOARD.
§12-6-2. Definitions.
As used in this article, unless a different meaning clearly appears from the context:
(1) "Beneficiaries" means those individuals entitled to benefits from the participant plans;
(2) "Board" means the governing body for the West Virginia Investment Management Board and any reference elsewhere in this code to Board of Investments or West Virginia Trust Fund means the board as defined in this subdivision;
(3) "Business operations" means maintaining, selling or leasing equipment, facilities, personnel or any other apparatus of business of commerce in a country engaging in terrorist activities, including ownership or possession of real or personal property located in a country engaging in terrorist activities.
(4) "Company" means a sole proprietorship, organization, association, corporation, partnership, venture or other entity, its subsidiary or affiliate that exists for profitmaking purposes or to otherwise secure economic advantage. "Company" also means a company owned or controlled, either directly or indirectly, by the government of a country engaging in terrorist activities, that is established or organized under the laws of or has its principal place of business in a country engaging in terrorist activities.
~~(3)~~ (5) "401(a) plan" means a plan which is described in section 401(a) of the Internal Revenue Code of 1986, as amended, and with respect to which the board has been designated to hold assets of the plan in trust pursuant to the provisions of section nine-a of this article;
(6) "Invest" or "investment" means the purchase, ownership or control of stock of a company, association or corporation, the capital stock of a mutual water company or corporation, bonds issued by the government or a political subdivision of a country engaging in terrorist activities, corporate bonds or other debt instruments issued by a company, or the commitment of funds or other assets to a company including a loan or extension of credit to that company.
(7) "Iran" means the Islamic Republic of Iran or a territory under the administration or control of Iran.
~~(4)~~ (8) "Local government funds" means the moneys of a political subdivision, including policemen's pension and relief funds, firemen's pension and relief funds and volunteer fire departments, transferred to the board for deposit;
(9) "Military equipment" means weapons, arms or military defense supplies.
~~(5)~~ (10) "Participant plan" means any plan or fund subject now or hereafter to subsection (a), section nine-a of this article;
~~(6)~~ (11) "Political subdivision" means and includes a county, municipality or any agency, authority, board, county board of education, commission or instrumentality of a county or municipality and regional councils created pursuant to the provisions of section five, article twenty-five, chapter eight of this code;
~~(7)~~ (12) "Trustee" means any member serving on the West Virginia Investment Management Board: Provided, That in section nine-a of this article in which the terms of the trusts are set forth, "trustee" means the West Virginia Investment Management Board;
~~(8)~~ (13) "Securities" means all bonds, notes, debentures or other evidences of indebtedness and other lawful investment instruments; and
~~(9)~~ (14) "State funds" means all moneys of the state which may be lawfully invested except the "school fund" established by section four, article XII of the state Constitution.
(15) "Terrorist activities" means any activity which is unlawful under the laws of the place where it is committed or which, if committed in the United States, would be unlawful under the laws of the United States or any state and which involves any of the following:
(A) The highjacking or sabotage of any conveyance, including an aircraft, vessel or vehicle.
(B) The seizing or detaining, and threatening to kill, injure or continue to detain, an individual in order to compel a third person, including a governmental organization, to do or abstain from doing any act as an explicit or implicit condition for the release of the individual seized or detained.
(C) A violent attack upon an internationally protected person, as defined in section 1116(b)(4) of Title 18 United States Code or upon the liberty of such a person.
(D) An assassination.
(E) The use of any:
(i) Biological agent, chemical agent or nuclear weapon or device; or
(ii) Explosive or firearm with intent to endanger, directly or indirectly, the safety of one or more individuals or to cause substantial damage to property.
(G) A threat, attempt or conspiracy to do any of the foregoing.
(H) The preparation or planning of a terrorist activity.
(I) The gathering of information on potential targets for terrorist activity.
(J) The providing of any type of material support, including the sale of military equipment, providing a safe house, transportation, communication, funds, false identification, weapons, explosives or training, to any individual the nation knows or has reason to believe has committed or plans to commit a terrorist activity.
(K) The soliciting of funds or other things of value for terrorist activity of for any terrorist organization.
(L) The solicitation of any individual for membership in a terrorist organization, terrorist government or to engage in a terrorist activity.

§12-6-12a. Legislative findings on investment with countries engaging in terrorist activities.

(a) The Securities and Exchange Commission has determined that business activities in countries engaging in terrorist activities and that are subject to sanctions by the United States may materially harm the shared value of foreign companies. Shares in these foreign companies may be held by using state money.
(b) Publicly traded companies in the United States are substantially restricted in doing business in or with countries engaging in terrorist activities that the United States Department of State has identified as sponsoring terrorism.
(c) State money is currently invested on behalf of the citizens of West Virginia in publicly traded companies that may be at risk due to business ties with countries engaging in terrorist activities and are involved in proliferation of weapons of mass destruction.
(d) Investments in publicly traded foreign companies that have business operations in or with countries engaging in terrorist activities are liable for sanctions under United States law and risk the pensions of the dedicated public employees of this state.
(e) Excluding companies with business activities in foreign counties engaging in terrorist activities and divesting from public portfolios will help protect the public retirement systems in this state from investment losses related to these business activities and may improve the investment performance of the public retirement systems.
(f) It is unconscionable for this state to invest in foreign companies with business activities benefitting countries engaging in terrorist activities that commit egregious violations of human rights and sponsor terrorist acts.
(g) It is the governments of these countries engaging in terrorist activities and not the people of nations such as Iran, North Korea and Sudan, that are responsible for support of terrorism and which commits egregious violation of human rights under which its own citizens are required to live.
§12-6-12b. Investment of state money in companies that do business in countries engaging in terrorist activities is restricted.
(a) The board of investment may not invest state money in a company which has business operations in a country engaging in terrorist activities as identified by the board through publicly available information including, but not limited to, information provided by nonprofit and other organizations and government entities.
(b) On or before June 30, 2010, the Board of Investments shall determine which companies are subject to divestment.
(c) After the determination described in subdivision (b), the Board of Investments shall take appropriate action to sell, redeem, divest or withdraw any investment held in violation of this section. Such sale, divestment, redemption or withdrawal shall be completed not later than one year following the effective date of this section.
(d) Within sixty days after the effective date of this section, the Board of Investments shall submit to the Governor, the President of the Senate and the Speaker of the House a report of all investments held as of such effective date that are in violation of this section. One year after the effective date of this section, the executive director shall report on the completion of all sales, redemptions, divestments or withdrawals of such investments in compliance with this section.
ARTICLE 6C. WEST VIRGINIA BOARD OF TREASURY INVESTMENTS.
§12-6C-3. Definitions.
As used in this article, unless a different meaning clearly appears from the context:
(1) "Board" means the governing body for the West Virginia Board of Treasury Investments. References in this code to the entity investing the moneys of the Consolidated Fund, to the West Virginia Board of Investments, to the West Virginia Trust Fund or to the West Virginia Investment Management Board in connection with investing moneys in the Consolidated Fund means the board as defined in this subdivision;
(2) "Business operations" means maintaining, selling or leasing equipment, facilities, personnel or any other apparatus of business of commerce in a country engaging in terrorist activities, including ownership or possession of real or personal property located in a country engaging in terrorist activities.
(3) "Company" means a sole proprietorship, organization, association, corporation, partnership, venture or other entity, its subsidiary or affiliate that exists for profitmaking purposes or to otherwise secure economic advantage. "Company" also means a company owned or controlled, either directly or indirectly, by the government of a country engaging in terrorist activities, that is established or organized under the laws of or has its principal place of business in a country engaging in terrorist activities.
~~(2)~~ (4) "Consolidated fund" means the investment fund continued in section six of this article and transferred to the board by the West Virginia Investment Management Board for Management and Investment;
~~(3)~~ (5) "Director" means any member serving on the board;
(6) "Invest" or "investment" means the purchase, ownership or control of stock of a company, association or corporation, the capital stock of a mutual water company or corporation, bonds issued by the government or a political subdivision of a country engaging in terrorist activities, corporate bonds or other debt instruments issued by a company, or the commitment of funds or other assets to a company including a loan or extension of credit to that company.
~~(4)~~ (7) "Local government funds" means the moneys of a political subdivision, including policemen's and firemen's pension and relief funds, and volunteer fire department funds, transferred to the board for deposit;
(8) "Military equipment" means weapons, arms or military defense supplies.
~~(5)~~ (9) "Participant" means any state government spending unit or political subdivision which transfers moneys to the board for investment;
~~(6)~~ (10) "Political subdivision" means and includes a county, municipality or any agency, authority, board, county board of education, commission or instrumentality of a county or municipality and regional councils created pursuant to the provisions of section five, article twenty-five, chapter eight of this code;
~~(7)~~ (11) "Securities" means all bonds, notes, debentures or other evidences of indebtedness and other lawful investment instruments; and
~~(8)~~ (12) "State funds" means all moneys of the state which may be lawfully invested except for the "school fund" established by section four, article XII of the state Constitution.
(13) "Terrorist activities" means any activity which is unlawful under the laws of the place where it is committed or which, if committed in the United States, would be unlawful under the laws of the United States or any state and which involves any of the following:
(A) The highjacking or sabotage of any conveyance, including an aircraft, vessel or vehicle.
(B) The seizing or detaining, and threatening to kill, injure, or continue to detain, an individual in order to compel a third person, including a governmental organization, to do or abstain from doing any act as an explicit or implicit condition for the release of the individual seized or detained.
(C) A violent attack upon an internationally protected person, as defined in section 1116(b)(4) of Title 18 United States Code or upon the liberty of such a person.
(D) An assassination.
(E) The use of any:
(i) Biological agent, chemical agent or nuclear weapon or device; or
(ii) Explosive or firearm with intent to endanger, directly or indirectly, the safety of one or more individuals or to cause substantial damage to property.
(G) A threat, attempt or conspiracy to do any of the foregoing.
(H) The preparation or planning of a terrorist activity.
(I) The gathering of information on potential targets for terrorist activity.
(J) The providing of any type of material support, including the sale of military equipment, providing a safe house, transportation, communication, funds, false identification, weapons, explosives or training, to any individual the nation knows or has reason to believe has committed or plans to commit a terrorist activity.
(K) The soliciting of funds or other things of value for terrorist activity of for any terrorist organization.
(L) The solicitation of any individual for membership in a terrorist organization, terrorist government, or to engage in a terrorist activity.

§12-6C-9a. Legislative findings on investment with countries engaging in terrorist activities.

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