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Fossil-fuel divestiture hearing: Retirees’ interests vs. environmental concerns
State House News Service
June 9, 2015
During a packed hearing late Tuesday morning, supporters of bills that would divest public pensions from fossil fuel energy industry over concerns that relying on profits from those companies helps contribute to climate change.
Legislation calling for fossil fuel divestment has been filed by Sen. Benjamin Downing and Rep. Marjorie Decker, and both testified in support of weaning the public pension fund off fossil fuel profits. and both testified before the Joint Committee on Public Service in support of weaning public pensions off fossil fuel profits.
Downing told board members that the state, under both governors Deval Patrick and Charlie Baker, has supported initiatives to promote solar and other clean energy efforts. He said public pensions shouldn’t draw on income from the fossil fuel energy industry.
“If we are serious about our climate goals, we cannot just be serious about one side of the ledger,” said Downing, adding later that he did not lightly propose changes to pension policy.
Downing said his bill would divest public pension revenues from fossil fuels by 20 percent over five years, and includes provisions that stop the process if it adversely affected retiree’s pensions.
“If I thought for one moment that this would risk the hard-earned pensions of thousands of workers… I would not be sitting here proposing it,” he said.
Decker, who brought her pre-school age daughter to the hearing, said her views on climate issues changed after becoming a mother.
“Once I had children, the urgency of this issue hit me like a brick,” said Decker.
Opponents of divestment who testified empathized with the goals of limiting the impact of fossil fuels on the environment, but said carving out that funding would be borne by retirees.
Ralph White, a member of the Massachusetts Association of Contributory Retirement Systems, said coal represented about 8 percent of the group’s fund — approximately $5 billion. While he said considered the move to limit reliance on fossil fuel revenues a “worthy” goal, he warned it would have an impact. “You’re talking about selling off $1 billion a year,” he said, referring to the Downing bill.
Shawn Duhamel, the legislative liaison for Mass Retirees, said that more study was needed before lawmakers should consider divestment. He supported a bill filed by Rep. Aaron Michlewitz, D-Boston (H.2372), which calls for a special commission to study divestment from fossil fuel companies.
“We can’t operate in a vacuum,” Duhamel told the board. “While we do have shared concerns about climate change, we want to make sure we get this issue right.”
Before the hearing, a few dozen protesters pushing for divestment stood outside the State House, and later packed the meeting room used by the public service committee. Bob Morrison of Sudbury said divestment is a “moral and financial issue,” as continuing to allow pensions to profit from the success of companies that produce fossil fuel will contribute to climate change.
“This is not going to affect me,” said Morrison, but will affect the kind of world today’s children will live in.
Another divestment supporter was Dave Roitman, a Florence resident who pointed to the tumbling value of coal as an indicator of things to come with fossil fuel investments. The value of coal on the Dow Jones Coal Index, for example, reportedly fell by about 75 percent over the past five years.
“We’re at the point that money invested in fossil fuels will be an incredibly risky and dumb investment,” said Roitman.