NY State Senate Bill 2017-S7194

Senate Bill S7194

2017-2018 Legislative Session

Relates to prohibiting the investment of common retirement funds in private prisons

download bill text pdf

Archive: Last Bill Status - In Senate Committee Civil Service And Pensions Committee

Introduced
- In Committee Assembly
- In Committee Senate
- On Floor Calendar Assembly
- On Floor Calendar Senate
- Passed Assembly
- Passed Senate
Delivered to Governor
Signed By Governor

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	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Jan 03, 2018	referred to civil service and pensions

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2017-S7194 (ACTIVE) - Details

See Assembly Version of this Bill:: A9015
Current Committee:: Senate Civil Service And Pensions
Law Section:: Retirement and Social Security Law
Laws Affected:: Add §423-d, R & SS L
Versions Introduced in 2017-2018 Legislative Session:: S7194, A9015

2017-S7194 (ACTIVE) - Summary

Relates to prohibiting the investment of common retirement funds in stocks, securities or other obligations of any institution, company, or subsidiary that owns or invests in a for-profit institution that owns or contracts with a government to manage or run a prison.

2017-S7194 (ACTIVE) - Sponsor Memo

                                
 
BILL NUMBER: S7194

SPONSOR: BENJAMIN
 
TITLE OF BILL:  An act to amend the retirement and social security
law, in relation to prohibiting the investment of common retirement
funds in private prisons

 
PURPOSE:

To require the Common Retirement Fund to divest from any active or
passive investments in private prisons

 
SUMMARY OF PROVISIONS:

Section one of this bill amends the retirement and social security law
by adding a new subdivision 43-d, which would prohibit the Common
Retirement Fund from investing in any company that owns or invests in a
for-profit institution that owns or contracts with a government to
manage or run a prison. No later than one year after the effective date,
the Comptroller would be required to divest all assets held by the
Common Retirement Fund that otherwise violate the above provision.

Provided, however, that the Comptroller determine what date sale will be
effectuated within the one year time frame on the basis of ensuring that
sale of such assets is not effectuated at a loss compared to value of
the assets on the date of purchase. The Comptroller shall be required to
report to the Legislature progress in divesting from such investments
and reasons, if applicable, why sale has not occurred within six months
of the effective date.

 
JUSTIFICATION:

The private prison industry's explosive growth is a direct result of the
racially unjust stricter sentencing laws of the 1980's and 1990's. The
correctional system's aim is to protect the public by deterring crime
and removing and rehabilitating those who commit crimes. Yet, over the
years, the for-profit prison industry has been a barrier to this aim.
The industry has seen a litany of abuses, as profit-motive leads prison
managers to provide inadequate and questionable standards for the hous-
ing of prison inmates. In 2016, the United States Department of Justice
found that for-profit prisons do not provide the same level of correc-
tional services, programs, and resources, nor did for-profit prisons
save taxpayer dollars. While the election of President Trump stalled
proposed reforms at the federal level on the use of private prisons, New
York can and should take the lead in curbing their use.

The negative social cost associated with this industry's activities
makes the State of New York's investment in this industry an irresponsi-
ble one. Divestment of public pension assets from for-profit prisons
would help curb the use of private prisons by removing a large chunk of
funds from their control, and removing tacit support of the state of New
York for their practices. In 2017, New York City Comptroller Scott
Stringer announced that the City pension investments in private prisons
would be liquidated. Similar divestment by the State Comptroller of the
Common Retirement Fund would make an even bigger economic impact. Comp-
troller Dinapoli has already moved to liquidate shares of particularly
notorious for-profit prison companies, but this legislation would ensure
total liquidation and prohibit any future Comptroller from reinvesting
in this notorious industry.

 
PRIOR LEGISLATIVE HISTORY:

New Bill

 
FISCAL IMPLICATIONS:

None

 
EFFECTIVE DATE:
This act shall take effect immediately.

2017-S7194 (ACTIVE) - Bill Text download pdf

                            
 
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   7194
 
                             I N  S E N A T E
 
                                (PREFILED)
 
                              January 3, 2018
                                ___________
 
 Introduced  by Sen. BENJAMIN -- read twice and ordered printed, and when
   printed to be committed to the Committee on Civil Service and Pensions
 
 AN ACT to amend the retirement and social security law, in  relation  to
   prohibiting the investment of common retirement funds in private pris-
   ons

   THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. The retirement and social security law is amended by adding
 a new section 423-d to read as follows:
   § 423-D. INVESTMENTS IN PRIVATE PRISONS. 1. NO MONIES  OF  THE  COMMON
 RETIREMENT  FUND  SHALL  BE INVESTED IN THE STOCKS, SECURITIES, OR OTHER
 OBLIGATIONS OF ANY INSTITUTION, COMPANY,  OR  SUBSIDIARY  THAT  OWNS  OR
 INVESTS  IN  A  FOR-PROFIT  INSTITUTION  THAT  OWNS  OR CONTRACTS WITH A
 GOVERNMENT TO MANAGE OR RUN A PRISON.
   2. NOTWITHSTANDING ANY OTHER PROVISION OF  LAW  TO  THE  CONTRARY,  NO
 LATER  THAN ONE YEAR AFTER THE EFFECTIVE DATE OF THIS ACT, ANY MONEYS OR
 ASSETS OF THE COMMON RETIREMENT FUND WHICH SHALL REMAIN OR  BE  INVESTED
 IN  THE  STOCKS,  SECURITIES,  OR  OTHER OBLIGATIONS OF ANY INSTITUTION,
 COMPANY, OR SUBSIDIARY OF A COMPANY THAT OWNS OR INVESTS IN A FOR-PROFIT
 INSTITUTION THAT OWNS OR CONTRACTS WITH A GOVERNMENT TO MANAGE OR RUN  A
 PRISON SHALL BE WITHDRAWN.
   3. THE COMPTROLLER SHALL, IN ACCORDANCE WITH SOUND INVESTMENT CRITERIA
 AND  CONSISTENT  WITH  HIS OR HER FIDUCIARY OBLIGATIONS, DIVEST ANY SUCH
 STOCKS, SECURITIES, OR OTHER OBLIGATIONS WHETHER THEY ARE OWNED DIRECTLY
 OR HELD THROUGH SEPARATE ACCOUNTS OR ANY  COMMINGLED  FUNDS.  THE  COMP-
 TROLLER  SHALL  STRIVE  TO  MAXIMIZE  THE  POTENTIAL VALUE OF ALL ASSETS
 LIQUIDATED UNDER THIS SECTION IN DETERMINING WHAT POINT TO CONDUCT  SALE
 OR  LIQUIDATION,  AND MAY EFFECTUATE SALE OF ASSETS PURSUANT TO SUBDIVI-
 SION TWO OF THIS SECTION AT ANY POINT WITHIN ONE YEAR AFTER  THE  EFFEC-
 TIVE  DATE  OF  THIS ACT ON THE BASIS OF POTENTIAL LOSS FROM THE SALE OF
 THE RELEVANT ASSETS COMPARED TO THE VALUE OF THE ASSETS AT THE  TIME  OF
 PURCHASE. PROVIDED, HOWEVER, THAT IF THE VALUE OF THE ASSETS ARE GREATER
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets

                       [ ] is old law to be omitted.
                                                            LBD14057-01-7

 S. 7194                             2
 
 ON  THE  EFFECTIVE  DATE  OF  THIS ACT THAN ON THE DATE OF PURCHASE, THE
 COMPTROLLER SHALL BEGIN SALE OR LIQUIDATION OF SUCH ASSETS IMMEDIATELY.
   4.  ON  OR BEFORE SIX MONTHS AFTER THE EFFECTIVE DATE OF THIS ACT, THE
 COMPTROLLER SHALL ISSUE A REPORT TO THE GOVERNOR, THE  TEMPORARY  PRESI-
 DENT  OF THE SENATE, AND THE SPEAKER OF THE ASSEMBLY AND SHALL MAKE SUCH
 REPORT PUBLICLY AVAILABLE ON ALL ACTIONS TAKEN PURSUANT TO THIS SECTION,
 INCLUDING INVESTMENT ACTIONS TAKEN AND, IF  INVESTMENT  ACTION  HAS  NOT
 BEEN  TAKEN  PURSUANT  TO SUBDIVISION THREE OF THIS SECTION, THE REASONS
 FOR THE COMPTROLLER'S INACTION AND PLANS FOR FULL COMPLIANCE  WITH  THIS
 SECTION.
   § 2. This act shall take effect immediately.

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