Ohio Pension Fund Rejects Gov. John Kasich's Demand to Dump Iran Investments
A spokeswoman for the Ohio Public Employee Retirement System says officials can't use "the system's money to achieve political or social agendas."
By Darrel Rowland
Not only did Gov. John Kasich add his name to a letter Tuesday from 15 governors opposing the Obama administration's Iran nuclear deal, he is actively encouraging Ohio's biggest pension fund to pull its money from companies that invest in the country once the current U.S. sanctions are lifted.
No can do, says a spokeswoman for the Ohio Public Employee Retirement System, which has more than $91 billion in assets and covers 1 million past and present public employees.
"No matter how worthwhile the purpose, such actions set a dangerous precedent of using the system's money to achieve political or social agendas," said Julie Graham-Price, the fund's communications manager. "The pension system's fiduciary duty to protect retiree pensions is undermined when pension assets are restricted ... Placing the responsibility and financial risk of applying economic pressure to selected governments exclusively on the backs of Ohio public employees and retirees is an unfair approach."
Kasich cited a portion of the Iran agreement that "actively encourage(s)" states to lift divestment policies. The governor, who has no direct authority over the pension system, asked board members to "maintain the current policies with our state pension funds while looking for responsible ways to divest in companies that do business with Iran whenever possible."
The PERS current policy, established in 2007 and reaffirmed in March, establishes a goal of reducing investment exposure to companies with ties to Iran and Sudan when comparable investments offering similar quality, return and safety are available.
As of June 30, the pension fund had reduced its "exposure to scrutinized companies" from 24 sources with $393 million to two with $18.6 million, including just one doing business with Iran, a Russian oil and gas company.
"We believe the current policy is working," Graham-Price said. "The purpose of a pension system is not to influence foreign policy; it is to manage the trust fund to ensure pension benefits are paid. We believe the federal government is the appropriate level of government to handle foreign policy for the United States."
The missive from Kasich and the other governors to Obama said, "If implemented, this agreement would lead to the lifting of United States nuclear-related sanctions on Iran without any guarantee that Iran's drive toward obtaining a nuclear weapon will be halted or even slowed."
Along with Kasich, three other presidential candidates added their names to the letter: Govs. Bobby Jindal of Louisiana, Chris Christie of New Jersey and Scott Walker of Wisconsin.
>> John Kasich: complete coverage of the presidential campaign The letter was sent even as Obama was gaining support for the agreement from the 41st Democratic senator, ensuring the measure will not even come up for a vote in the U.S. Senate.
Meanwhile, state Treasurer Josh Mandel said Tuesday he's joined a national organization that will work to put measures on the ballot in Ohio and other states aimed at keeping state tax dollars from being invested in or spent with corporations doing business with Iran.
The group, Defund Iran, hopes to amend state constitutions and revise state statutes with terrorism divestiture provisions. Mandel joins former Missouri state Treasurer Sarah Steelman and former Colorado House Minority Leader Mark Waller as co-chairs of the organization. Both Mandel and Waller are veterans of the Iraq War.
"Our goal is to combat this abuse of federal power by placing on the November ballot in 2016, in as many states as possible, state constitutional amendments codifying and strengthening state Terrorism Divestiture laws and policies," Mandel said. "We will use the authority of the ballot box. Let's put it to a vote."
Defund Iran hopes to get initiatives on the ballot in Ohio, Missouri, Colorado and other states.
Jessica Wehrman of the Dispatch Washington bureau contributed to this story.
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