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Merkley urges Oregon pension fund to drop prison companies

Sen. Jeff Merkley
KTVZ File
Senator Jeff Merkley

By Andrew Selsky, AP staff writer

SALEM, Ore. (AP) — Sen. Jeff Merkley, D-Ore., a sharp critic of the Trump administration’s immigration policies, is urging the Oregon state employee pension fund to drop investments in prison companies where immigrants have been locked up by federal immigration officials.

Oregon was the nation’s first sanctuary state, but its pension fund has $2 million invested, via an index fund, in two prison companies that New York state and California recently decided to drop from their own pension funds.

“I think it’s way past time for fundamental values to be reflected in our investment decisions,” Merkley, a Democrat from Oregon, said in an email to The Associated Press late Monday.

The Register-Guard newspaper in Eugene, citing a Nov. 19 AP story about Oregon’s investments, said: “Oregon doesn’t put its money where its mouth is.”

The Register-Guard noted in its Nov. 22 editorial that in 1987, Republicans and Democrats in the state Legislature came together to pass the Oregon Anti-Apartheid Act, so the pension fund could divest from South Africa because of its racist white regime and brutal repression of majority blacks.

Oregon’s pension fund also has a $233 million investment in Novalpina Capital, a private equity firm that, along with partners, bought a majority share of NSO Group, an Israeli spyware company.

Human rights groups say NSO Group’s spyware, which can steal data from smartphones and turn them into eavesdropping devices, has been used by repressive regimes against human rights defenders, journalists and political opponents in Mexico, the Middle East and North Africa.

Oregon treasury officials say they cannot comment on private equity investments, which go into companies that are not publicly traded on a stock exchange.

Oregon State Treasurer Tobias Read’s office has insisted that it can’t drop the prison companies, CoreCivic and Geo Group, because only the index provider can determine what’s added or dropped from the index. If Oregon officials intervene, the pension fund would incur costs that violate the “paramount objective” of making money, Read’s office said earlier this year.

Merkley said other states have shown it can be done.

“The fact that New York and California have already dropped investments in prison companies shows that this is a path that is available to us, and I think it’s the right path,” the senator said.

CoreCivic and Geo Group did not immediately respond to requests for comment. CoreCivic said in July that its facilities alleviate dangerous, overcrowded conditions and that it won’t ever house unaccompanied immigrant minors.

Rukaiyah Adams, the chairwoman of the Oregon Investment Council, which oversees the state’s $77 billion pension fund, said in an interview last month that the council is moving toward stronger environmental, social and governance standards, known as ESG. Adams also noted the treasury last year hired a staffer to focus on ESG but acknowledged the state has catching up to do.

Merkley, a former speaker of the Oregon House of Representatives, said that if the investment council doesn’t feel it has the power now to divest, the Oregon Legislature should provide them with that ability.

Senate President Peter Courtney and House Speaker Tina Kotek, both Democrats, did not immediately respond to requests for comment. Nor did a spokeswoman for the Oregon State Treasury.

Rep. Diego Hernandez, a Portland Democrat in the Oregon House, said he believes the Legislature should take up the issue, but noted that the 2020 session is a short one, and that the long 2021 session would be more realistic timing.

Investors around the globe are increasingly incorporating social values like climate change and human rights in deciding where to put their money. Asset managers in the United States consider such criteria across $11.6 trillion in assets, representing roughly $1 out of every $4 under professional management, according to a 2018 survey by the U.S. Forum for Sustainable and Responsible Investment.

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Follow Andrew Selsky on Twitter at https://twitter.com/andrewselsky

Government / News / Oregon-Northwest / Top Stories

The Associated Press

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