WEST virginia legislature
2022 regular session
Senate Bill 262
By Senators Phillips, Grady, Martin, Maynard, Karnes, Hamilton, and Woodrum
[Passed March 12, 2022; in effect 90 days from passage]
AN ACT to amend the Code of West Virginia, 1931, as amended, by adding thereto a new article, designated §12‑1C‑1, §12‑1C‑2, §12‑1C‑3, §12‑1C‑4, §12‑1C‑5, §12‑1C‑6, and §12‑1C‑7, all relating generally to financial institutions engaged in boycotts of energy companies; defining terms; authorizing the State Treasurer to publish a list of financial institutions engaged in boycotts of energy companies; requiring the Treasurer to publicly post the list and submit the list to certain public officials; requiring the list to contain certain information; requiring the Treasurer to send written notice to a financial institution prior to its inclusion on the list; establishing required content of said written notice; requiring the Treasurer to remove a financial institution from the list if it presents information demonstrating that it is not engaged in a boycott of energy companies; preventing financial institutions from being compelled to produce certain information; setting forth sources of information on which the Treasurer may rely in preparing the list; authorizing the Treasurer to exclude financial institutions on the list from the selection process for state banking contracts; authorizing the Treasurer to refuse to enter into a banking contract with a financial institution on the list; authorizing the Treasurer to require, as a term of a banking contract, an agreement by the financial institution not to engage in a boycott of energy companies; limiting liability for actions taken in compliance with the new article; and exempting the Investment Management Board from the new article.
Be it enacted by the Legislature of West Virginia:
ARTICLE 1C. Financial institutions engaged in boycotts of energy companies.
(a) For the purposes of this article, the following terms shall have the following meanings:
(1) “Banking contract” means a contract entered into by the Treasurer and a financial institution pursuant to this chapter, to provide banking goods or services to a spending unit.
(2) “Boycott of energy companies” means without a reasonable business purpose, refusal to deal with a company, termination of business activities with a company, or another action that is intended to penalize, inflict economic harm on, or limit commercial relations with a company because the company:
(A) Engages in the exploration, production, utilization, transportation, sale, or manufacturing of fossil fuel‑based energy;
(B) Engages in the exploration, production, utilization, transportation, sale, or manufacturing of fossil fuel‑based energy and does not commit or pledge to meet environmental standards beyond applicable federal and state law; or
(C) Does business with a company that engages in the exploration, production, utilization, transportation, sale, or manufacturing of fossil fuel‑based energy.
(3) “Company” means any sole proprietorship, organization, association, corporation, partnership, joint venture, limited partnership, limited liability partnership, limited liability company, or other entity or business association, including all wholly owned subsidiaries, majority‑owned subsidiaries, parent companies, or affiliates of those entities or business associations, that exist for the purpose of making profit.
(4) “Financial institution” means a bank, national banking association, non‑bank financial institution, a bank and trust company, a trust company, a savings and loan association, a building and loan association, a mutual savings bank, a credit union, or a savings bank.
(5) “Reasonable business purpose” includes any purpose directly related to:
(A) Promoting the financial success or stability of a financial institution;
(B) Mitigating risk to a financial institution;
(C) Complying with legal or regulatory requirements; or
(D) Limiting liability of a financial institution.
(6) “Restricted financial institution” means a financial institution included in the most recently updated restricted financial institution list.
(7) “Restricted financial institution list” means the list of financial institutions prepared, maintained, and published pursuant to this article.
(8) “Treasurer” refers to the West Virginia State Treasurer.
§12‑1C‑2. Restricted financial institutions list.
(a) The Treasurer is authorized to prepare and maintain a list of financial institutions that are engaged in a boycott of energy companies.
(b) The Treasurer must publicly post the restricted financial institution list on the Treasurer’s website and submit a copy of the list to the Governor, the President of the Senate, and the Speaker of the House of Delegates.
(c) A citation to this article and a brief summary of the purpose of the list must appear at the top of the list, including a statement that inclusion on the list is not an indication of unsafe or unsound operating conditions of any financial institution nor any risk to consumer deposits.
(d) The Treasurer must update the restricted financial institution list annually, or more often as the Treasurer considers necessary.
§12‑1C‑3. Notice to financial institutions.
(a) Forty‑five days prior to including a financial institution on the restricted financial institution list, the Treasurer must send a written notice to the institution containing the following information:
(1) That the Treasurer has determined that the financial institution is a restricted financial institution;
(2) That the financial institution will be placed on the restricted financial institution list in 45 days unless, within 30 days following the receipt of the written notice, the restricted financial institution demonstrates that it is not engaged in a boycott of energy companies;
(3) That the restricted financial institution list is published on the Treasurer’s website; and
(4) That the institution’s placement on the list may render the institution ineligible to enter into, or remain in, banking contracts with the State of West Virginia.
(b) Following a restricted financial institution’s inclusion on the restricted financial institution list, the Treasurer will remove the institution from the list if the institution demonstrates that it has ceased all activity that boycotts energy companies.
§12‑1C‑4. Sources of information.
(a) In determining whether to include a financial institution on the restricted financial institution list, the Treasurer shall consider and may rely upon the following information:
(1) A financial institution’s certification that it is not engaged in a boycott of energy companies;
(2) Publicly available statements or information made by the financial institution, including statements by a member of a financial institution’s governing body, an executive director of a financial institution, or any other officer or employee of the financial institution with the authority to issue policy statements on behalf of the financial institution; or
(3) Information published by a state or federal government entity.
(b) In determining whether to include a financial institution on the restricted financial institution list, the Treasurer may not rely solely on the following information:
(1) Statements or complaints by an energy company; or
(2) Media reports of a financial institution’s boycott of energy companies.
(c) A financial institution may not be compelled to produce or disclose any data or information deemed confidential, privileged, or otherwise protected from disclosure by state or federal law.
§12‑1C‑5. Restricted financial institutions.
(a) In selecting a financial institution to enter into a banking contract, the Treasurer is authorized to disqualify restricted financial institutions from the competitive bidding process or from any other official selection process.
(b) The Treasurer is authorized to refuse to enter into a banking contract with a restricted financial institution based on its restricted financial institution status.
(c) The Treasurer is authorized to require, as a term of any banking contract, an agreement by the financial institution not to engage in a boycott of energy companies for the duration of the contract.
§12‑1C‑6. Limitation on liability.
With respect to actions taken in compliance with this article, a public agency, public official, public employee, or member or employee of a financial institution is immune from liability.
The provisions of this section do not apply to the duties, actions, and transactions of the West Virginia Investment Management Board as set forth in §12‑6‑1 et seq. of this code.