STATE OF NEW YORK
        ________________________________________________________________________
                                          10404
                   IN ASSEMBLY
                                     April 19, 2018
                                       ___________
        Introduced  by M. of A. ORTIZ -- read once and referred to the Committee
          on Governmental Employees
        AN ACT to amend the retirement and social security law, in  relation  to
          enacting the "firearms and tobacco divestment act"
          The  People of the State of New York, represented in Senate and Assem-
        bly, do enact as follows:
     1    Section 1. This act shall be known and may be cited as  the  "firearms
     2  and tobacco divestment act".
     3    § 2. Section 423 of the retirement and social security law, as amended
     4  by chapter 770 of the laws of 1970, is amended to read as follows:
     5    §  423.  Investments.    [a.]  1.  On  and after April first, nineteen
     6  hundred sixty-seven, the comptroller shall invest the  available  monies
     7  of  the common retirement fund in any investments and securities author-
     8  ized by law for each retirement system and shall hold  such  investments
     9  in his name as trustee of such fund, notwithstanding any other provision
    10  of  this  chapter.  Participating interests in such investments shall be
    11  credited to each retirement system in the manner and at the time  speci-
    12  fied  in  [paragraph] subdivision two of section four hundred twenty-two
    13  of this article.
    14    [b.] 2. (a) To assist in the management of the monies  of  the  common
    15  retirement  fund,  the  comptroller shall appoint an investment advisory
    16  committee consisting of not less than seven members who shall serve  for
    17  his  term of office. A vacancy occurring from any cause other than expi-
    18  ration of term shall be filled by the comptroller for the  remainder  of
    19  the term. Each member of the committee shall be experienced in the field
    20  of  investments  and shall have served, or shall be serving, as a senior
    21  officer or member of the board of an insurance company,  banking  corpo-
    22  ration  or  other  financial or investment organization authorized to do
    23  business in the state of New York. The committee shall advise the  comp-
    24  troller  on  investment  policies  relating  to the monies of the common
    25  retirement fund and shall review, from  time  to  time,  the  investment
    26  portfolio  of  the  fund  and make such recommendations as may be deemed
    27  necessary.
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD15421-01-8

        A. 10404                            2
     1    (b) The comptroller shall appoint a separate mortgage advisory commit-
     2  tee, with the advice and consent of the investment  advisory  committee,
     3  to  review  proposed  mortgage and real estate investments by the common
     4  retirement fund. In making investments, as authorized by law, the  comp-
     5  troller  shall  be guided by policies established by each committee from
     6  time to time; and, in the event the mortgage advisory  committee  disap-
     7  proves  a proposed mortgage or real estate investment, such shall not be
     8  made.
     9    (c) No officer or employee of any state department or agency shall  be
    10  eligible  for  membership  on  either  committee.  Each  committee shall
    11  convene periodically on call of the  comptroller,  or  on  call  of  the
    12  chairman.  The members of each committee shall be entitled to reimburse-
    13  ment for their actual  and  necessary  expenses  but  shall  receive  no
    14  compensation for their services.
    15    3. (a) Notwithstanding any provision of law to the contrary, the comp-
    16  troller  shall  not have the power to invest the available monies of the
    17  common retirement fund in any stocks, debt or other  securities  of  any
    18  corporation  or  company,  or any subsidiary, affiliate or parent of any
    19  corporation or company, engaged  in  the  manufacture  of  firearms,  as
    20  defined  in  section  265.00 of the penal law. The comptroller shall, in
    21  accordance with sound investment criteria and consistent with his or her
    22  fiduciary obligations, divest any such stocks or other securities wheth-
    23  er they are owned directly or held  through  separate  accounts  or  any
    24  commingled  funds.  Divestment  pursuant  to  this  subdivision  must be
    25  completed within five years of the effective date of this subdivision.
    26    (b) The comptroller shall be permitted to cease divesting from  compa-
    27  nies under paragraph (a) of this subdivision, reinvest in companies from
    28  which  it  divested under paragraph (a) of this subdivision, or continue
    29  to invest in companies from which it has not yet divested upon clear and
    30  convincing evidence showing that as a direct result of such  divestment,
    31  the  total  and aggregate value of all assets under management by, or on
    32  behalf of, the common retirement fund becomes or shall become: (i) equal
    33  to or less than ninety-nine and one-half percent; or  (ii)  one  hundred
    34  percent  less fifty basis points of the hypothetical value of all assets
    35  under management by, or on behalf of, the common retirement fund  assum-
    36  ing no divestment from any company had occurred under said paragraph (a)
    37  of this subdivision. Cessation of divestment, reinvestment or any subse-
    38  quent  ongoing  investment  authorized by this section shall be strictly
    39  limited to the minimum steps necessary  to  avoid  the  contingency  set
    40  forth in the preceding sentence. For any cessation of divestment, and in
    41  advance  of  such  cessation,  authorized by this subdivision, the comp-
    42  troller shall provide a written report  to  the  attorney  general,  the
    43  senate  standing committee on civil service and pensions, and the assem-
    44  bly standing committee on governmental employees, updated  semi-annually
    45  thereafter  as  applicable, setting forth the reasons and justification,
    46  supported by clear and convincing evidence, for its decisions  to  cease
    47  divestment,  to  reinvest  or to remain invested in companies engaged in
    48  the manufacture of firearms, as defined in section 265.00 of  the  penal
    49  law.
    50    (c)  Within  sixty days of the effective date of this subdivision, the
    51  comptroller shall facilitate the identification of companies  in  compa-
    52  nies  engaged  in  the  manufacture  of  firearms, as defined in section
    53  265.00 of the penal  law  from  which  the  common  retirement  fund  is
    54  required  to  divest under paragraph (a) of this subdivision, and file a
    55  copy of this list with the attorney general, the senate standing commit-
    56  tee on civil service and pensions, and the assembly  standing  committee

        A. 10404                            3
     1  on  governmental  employees.  Annually thereafter, the public fund shall
     2  file a report with the attorney general, the senate  standing  committee
     3  on  civil  service  and pensions, and the assembly standing committee on
     4  governmental   employees   that  includes:  (i)  all  investments  sold,
     5  redeemed, divested or withdrawn in compliance with paragraph (a) of this
     6  subdivision; and (ii) all prohibited investments from which  the  common
     7  retirement  fund has not yet divested under paragraph (a) of this subdi-
     8  vision.
     9    4. (a) Notwithstanding any provision of law to the contrary, the comp-
    10  troller shall not have the power to invest the available monies  of  the
    11  common  retirement  fund  in any stocks, debt or other securities of any
    12  corporation or company, or any subsidiary, affiliate or  parent  of  any
    13  corporation  or  company, engaged in the manufacture of tobacco products
    14  as defined in section thirteen  hundred  ninety-nine-aa  of  the  public
    15  health  law.  The comptroller shall, in accordance with sound investment
    16  criteria and consistent with his or her  fiduciary  obligations,  divest
    17  any  such  stocks or other securities whether they are owned directly or
    18  help through separate  accounts  or  any  commingled  funds.  Divestment
    19  pursuant  to this subdivision must be completed within five years of the
    20  effective date of this subdivision.
    21    (b) The comptroller shall be permitted to cease divesting from  compa-
    22  nies under paragraph (a) of this subdivision, reinvest in companies from
    23  which  it  divested under paragraph (a) of this subdivision, or continue
    24  to invest in companies from which it has not yet divested upon clear and
    25  convincing evidence showing that as a direct result of such  divestment,
    26  the  total  and aggregate value of all assets under management by, or on
    27  behalf of, the common retirement fund becomes or shall become: (i) equal
    28  to or less than ninety-nine and one-half percent; or  (ii)  one  hundred
    29  percent  less fifty basis points of the hypothetical value of all assets
    30  under management by, or on behalf of, the common retirement fund  assum-
    31  ing no divestment from any company had occurred under said paragraph (a)
    32  of this subdivision. Cessation of divestment, reinvestment or any subse-
    33  quent  ongoing  investment  authorized by this section shall be strictly
    34  limited to the minimum steps necessary  to  avoid  the  contingency  set
    35  forth in the preceding sentence. For any cessation of divestment, and in
    36  advance  of  such  cessation,  authorized by this subdivision, the comp-
    37  troller shall provide a written report  to  the  attorney  general,  the
    38  senate  standing committee on civil service and pensions, and the assem-
    39  bly standing committee on governmental employees, updated  semi-annually
    40  thereafter  as  applicable, setting forth the reasons and justification,
    41  supported by clear and convincing evidence, for its decisions  to  cease
    42  divestment,  to  reinvest  or to remain invested in companies engaged in
    43  the manufacture of tobacco  products  as  defined  in  section  thirteen
    44  hundred ninety-nine-aa of the public health law.
    45    (c)  Within  sixty days of the effective date of this subdivision, the
    46  comptroller shall facilitate the identification of companies  in  compa-
    47  nies,  engaged  in  the  manufacture  of  tobacco products as defined in
    48  section thirteen hundred ninety-nine-aa of the public  health  law  from
    49  which  the  common retirement fund is required to divest under paragraph
    50  (a) of this subdivision, and file a copy of this list with the  attorney
    51  general,  the  senate  standing committee on civil service and pensions,
    52  and the assembly standing committee on governmental employees.  Annually
    53  thereafter, the public fund shall file a report with the attorney gener-
    54  al, the senate standing committee on civil service and pensions, and the
    55  assembly standing committee on governmental employees that includes: (i)
    56  all investments sold, redeemed, divested or withdrawn in compliance with

        A. 10404                            4
     1  paragraph  (a)  of this subdivision; and (ii) all prohibited investments
     2  from which the common retirement fund has not yet divested  under  para-
     3  graph (a) of this subdivision.
     4    § 3. This act shall take effect immediately.