Fossil Free

On Thursday, January 9, a packed committee room gave physical shape to the effort in support of divestment in Maine. LD 1461, sponsored by Representative Brian Jones (D-Freedom, ME), required the state’s pension fund, Maine Public Employees Retirement System (MainePERS) to divest from fossil fuel assets over the course of the next five years. The outcome of the hearing is a new directive to MainePERS to form a task force and set a deadline for developing guidelines on environmental, social and governance factors that will inform the agency’s practices – specifically regarding investment, divestment and proxy voting. The deadline for the report will be December 31, 2014. The directive will be included in a pending government oversight bill in this legislative session.

This is great news for advancing our effort to call on MainePERS to divest from fossil fuels.

Thirty-two people testified before the Joint Standing Committee on Appropriations and Financial Affairs in favor of LD 1461. Two people testified neither for nor against the bill; only MainePERS Executive Director Sandy Matheson testified against the bill, based on the vote of the organization’s board prior to the hearing.

In a work session on Friday, the committee voted unanimously “ought not to pass,” instead opting to direct MainePERS to take the actions described above.

Members of the committee indicated that they wanted to be able to act unanimously on their response to the bill and subsequent direction to MainePERS, knowing that Governor LePage, who recently said that global warming could be a good thing for Maine, would veto any bill to divest. And there are not enough votes in the legislature to overturn such a veto. The outcome of this hearing is especially noteworthy because the action earned the support of officials along a broad political spectrum, including varying beliefs on the existence of climate change. We hope that our success here will help show that change is possible, even in the face of stark ideological opposition.

What moved the committee to take action? While committee members were impressed by the amount of resources that were offered by 350 Maine divestment leaders (Karen Marysdaughter and Read Brugger), the many and diverse people who came to testify obviously moved many of its members. That group included Mary Harlan, an 83-year-old retired teacher drawing from the pension fund; Stephanie Leighton of Trillium Asset Management, a seasoned financial consultant working for sustainable investing for over 20 years; Phil Coupe, the owner of the leading solar business in northern New England, ReVision Energy; Bill Barter, executive director of the Maine Council of Churches and pastor of a Lutheran congregation in Brunswick, and 11-year-old Jade Kurtzer, who spoke about concerns for her future.

“Investments are not an emotional endeavor, and they shouldn’t be,” said MainePERS Matheson. She detailed restrictions in the state constitution and federal guidelines that held the fund management to economic performance. She also explained that past divestment movements (Sudan, South Africa, Northern Ireland) included language in the bill that allowed MainePERS to continue its invest-based-on-performance practice and only permitting moral issues to influence investment when performance could be considered equitable.

Jade testified that more than the bottom line needs to be considered, which she communicated through her own plea to the committee: “Someday I’d like to go to college, become a surgeon, and have a family. I’m worried that when I grow up the planet will not be a safe place for my kids. I know that everyone up here is testifying to save my future, so I’d greatly appreciate it if you’d put our money into something less harmful.”

In addition to the moral arguments for divestment, Leighton offered a compelling financial case. She testified that the Aperio Group, an investment firm that conducted independent studies from 1988 to 2012, had determined the risk of pulling assets out of fossil fuels would be negligible.

Leighton also pointed to MSCI for evidence that divesting is a sound decision when she stated that, “MSCI, a leading provider of investment decision support tools, looked at the impact of excluding companies owning carbon reserves from one of its index funds, the MSCI All Country World Index. It determined that over a five-year period, the active return differential was 1.2 percent better for the same index without fossil fuel investments.”

One person after another added voice to push this divestment movement forward with the message that climate change is a very real and very virulent threat. Without a doubt they were heard by committee members that were both highly engaged and notably interested in what was being said to them.

The efforts of dozens of engaged and motivated citizens were heard and taken seriously. We are excited to continue working to pursue fossil fuel divestment.

“Never doubt that a small group of thoughtful, committed citizens can change the world; indeed, it’s the only thing that ever has.” – Margaret Mead.

This post was co-authored by Sass Linneken and Heidi Brugger of 350 Maine