New Law Will Enhance Current Divestiture Law and Ensure Taxpayer Dollars are Not Invested in Companies Doing Business with Iranian Energy Interests
Governor Brown has signed into law Assembly Bill 1151, the Divest From Iran Act. The new law, authored by Assembly Members Mike Feuer (D-Los Angeles) and Bob Blumenfield (D-San Fernando Valley), will enhance California’s current divestiture law and bring new levels of transparency and accountability to California’s public pension funds, helping ensure that taxpayer dollars do not go toward investing in companies that do business with Iranian energy interests. The law will go into effect in January.
“This new law underscores that complying with California’s divestment laws is mandatory,” said Feuer. “As one of the world’s largest economies, California can take a meaningful stand against companies that choose to fund Iran’s nuclear ambitions by investing in its energy sector. By signing AB 1151, the Governor has sent the message that this responsibility will not be abrogated.” In mid-May, Assembly Members Feuer, Blumenfield and Furutani held a hearing to investigate why CalPERS and the California State Teachers Retirement System (CalSTRS) have failed to comply with the California law requiring public pensions to divest from companies with business interests in Iran. Just days before this hearing, CalPERS announced that it will divest most of investments in businesses with interests in Iran’s energy sector.
The hearing found that although this law became effective on January 1, 2008, CalPERS has still yet to effectuate meaningful divestment. “CalPERS has ignored the law requiring divestment from Iran for too long,” said Blumenfield. “This new law will help us fight to keep CalPERS accountable. If CalPERS refuses to abide by the law, it must publicly disclose why.” Assembly Members Feuer and Blumenfield have been waging a multi-prong campaign to ensure that California’s financial resources are not invested in companies doing business in Iran’s energy sector and not used to bolster Iran’s nuclear weapons development or extremist activities.
Last year, they authored the Iran Contracting Act of 2010, which prohibits contracts of $1 million or more between the State of California (including its cities and counties) and companies with significant business in Iran’s energy sector. AB 1650 also passed with bipartisan support. Recently, Feuer and Blumenfield contacted legislative leaders around the country urging them to become part of a national network asserting financial pressure to stop Iran’s nuclear ambitions by advancing similar contractual divestment legislation. (Assembly Member Feuer’s website: http://www. assembly.ca.gov/feuer — Assembly Member Blumenfield’s website: http://www.assembly. ca.gov/blumenfield)