| 1 | A bill to be entitled |
| 2 | An act relating to State Board of Administration |
| 3 | investments; providing legislative findings; providing |
| 4 | definitions; prohibiting certain pension or annuity fund |
| 5 | assets from being invested in certain companies with ties |
| 6 | to or engaged in business with known state sponsors of |
| 7 | terror; providing exceptions; requiring the State Board of |
| 8 | Administration to review investments and take certain |
| 9 | actions to sell, redeem, divest, or withdraw any |
| 10 | prohibited investments; requiring a report to the |
| 11 | Legislature; providing an effective date. |
| 12 |
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| 13 | WHEREAS, state sponsors of terror designated by the United |
| 14 | States provide military, financial, political, diplomatic, and |
| 15 | organizational aid to known terrorist groups, and |
| 16 | WHEREAS, some state sponsors of terror designated by the |
| 17 | United States are seeking to develop weapons of mass |
| 18 | destruction, including nuclear weapons, and |
| 19 | WHEREAS, support for terrorism and the acquisition of |
| 20 | weapons of mass destruction represent a grave threat to the |
| 21 | security of the United States and to the citizens of the State |
| 22 | of Florida, NOW, THEREFORE, |
| 23 |
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| 24 | Be It Enacted by the Legislature of the State of Florida: |
| 25 |
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| 26 | Section 1. (1) FINDINGS.-- |
| 27 | (a) The Legislature finds and declares that this state is |
| 28 | deeply concerned about investments in publicly traded companies |
| 29 | that have business activities in nations that are known |
| 30 | sponsors of terrorism as a global security and financial risk |
| 31 | to the shareholders. |
| 32 | (b) The Legislature finds that the Securities and |
| 33 | Exchange Commission determined that companies with business |
| 34 | operations in states that sponsor terrorists are exposed to a |
| 35 | special risk category known as global security risk. The term |
| 36 | "global security risk" means the risk to share value and |
| 37 | corporate reputation stemming from the intersection of a |
| 38 | publicly traded company's international business activities and |
| 39 | security-related concerns, such as terrorism and weapons |
| 40 | proliferation. |
| 41 | (c) The Legislature finds that by investing in publicly |
| 42 | traded companies with ties to known state sponsors of terror, |
| 43 | as designated by the United States Department of State, the |
| 44 | State Board of Administration is putting the pensions of its |
| 45 | public employees and citizens at risk. The Legislature also |
| 46 | finds that there are more than 450 United States and foreign |
| 47 | publicly traded companies that have business activities in or |
| 48 | with states that sponsor terrorists. |
| 49 | (d) To protect the public assets of this state, the |
| 50 | Legislature determines that it is in the best interest of the |
| 51 | state to enact a prohibition against the investment of public |
| 52 | employee retirement funds in companies doing business with or |
| 53 | in known state sponsors of terror. |
| 54 | (2) DEFINITIONS.--For purposes of this section, the term: |
| 55 | (a) "State sponsor of terror" means any country |
| 56 | determined by the Secretary of State to have repeatedly |
| 57 | provided support for acts of international terrorism. As of the |
| 58 | effective date of this section, the state sponsors of terror as |
| 59 | designated under these authorities are Cuba, Iran, North Korea, |
| 60 | Sudan, and Syria. |
| 61 | (b) "Company" means any entity having business ties of |
| 62 | any nature, scope, and type affecting commerce, including, but |
| 63 | not limited to, a government, government agency, corporation, |
| 64 | firm, subsidiary, financial institution, provider of financial |
| 65 | services, joint venture, trade association, or affiliate. |
| 66 | (c) "Equity tie" means any facility, plant, employee, or |
| 67 | advisor or an investment, fiduciary, monetary, or physical |
| 68 | presence of any kind. |
| 69 | (d) "Humanitarian aid" means the provision of goods and |
| 70 | services intended to relieve human suffering due to natural |
| 71 | disasters, war, or civil unrest. |
| 72 | (3) PROHIBITION.--Notwithstanding any other provision of |
| 73 | law, no assets of any pension or annuity fund under the |
| 74 | jurisdiction of the executive director and the Board of |
| 75 | Trustees of the State Board of Administration shall be invested |
| 76 | in any company that has an equity tie to or is engaged in |
| 77 | business with known state sponsors of terror. This prohibition |
| 78 | shall not apply to the activities of any company providing |
| 79 | humanitarian aid to the people of such states through either a |
| 80 | governmental or nongovernmental organization. |
| 81 | (4) EXECUTION AND REPORTING.-- |
| 82 | (a) The executive director and Board of Trustees of the |
| 83 | State Board of Administration, after reviewing the |
| 84 | recommendations of and consulting with an independent research |
| 85 | firm that specializes in global security risk, shall take |
| 86 | appropriate action to sell, redeem, divest, or withdraw any |
| 87 | investment held in violation of subsection (3). Such sale, |
| 88 | redemption, divestment, or withdrawal shall be completed not |
| 89 | later than 1 year following the effective date of this section. |
| 90 | (b) Within 60 days after the effective date of this |
| 91 | section, the executive director of the State Board of |
| 92 | Administration shall submit to the Governor, the President of |
| 93 | the Senate, and the Speaker of the House of Representatives a |
| 94 | report of all investments held as of such effective date that |
| 95 | are in violation of this section. One year after the effective |
| 96 | date of this section, the executive director shall report on |
| 97 | the completion of all sales, redemptions, divestments, or |
| 98 | withdrawals of such investments in compliance with this |
| 99 | section. |
| 100 | Section 2. This act shall take effect upon becoming a law. |