IN THE SENATE OF THE UNITED STATES
September 6, 2018
Mr. Merkley introduced the following bill; which was read twice and referred to the Committee on Homeland Security and Governmental Affairs
To amend title 5, United States Code, to provide for an investment option under the Thrift Savings Plan that does not include investment in any fossil fuel companies.
This Act may be cited as the
Retirement Investments for a Sustainable Economy Act of 2018 or the
RISE Act of 2018.
Sense of Congress
It is the sense of Congress that—
continued inaction by the Federal Government with respect to addressing climate change poses a significant threat to the growth and stability of the economy and population of the United States;
pension and retirement funds are vulnerable to distinct risks relating to climate change, including—
climate impact risks, including sea level rise, heat waves, desertification, ocean acidification, flooding, drought, extreme weather, and wildfires;
carbon-constrained demand risks, including stranded carbon assets, which financial institutions have estimated as having a value of $100,000,000,000,000; and
climate liability risks, including from evolving interpretations of fiduciary and tortious duties of care; and
assessing the potential impact of climate-related risks on national and international financial systems, including retirement savings accounts and pensions, is an urgent concern.
Climate Choice Stock Index Fund
Section 8438 of title 5, United States Code, is amended—
in subsection (a)—
by redesignating paragraphs (4) through (10) as paragraphs (7) through (13), respectively;
by redesignating paragraphs (1), (2), and (3) as paragraphs (2), (4), and (5), respectively;
by inserting before paragraph (2), as so redesignated, the following:
the term Climate Choice Stock Index Fund means the Climate Choice Stock Index Fund established under subsection (b)(1)(G);
by inserting after paragraph (2), as so redesignated, the following:
the term entity means any sole proprietorship, organization, association, corporation, partnership, joint venture, limited partnership, limited liability partnership, limited liability company, or other business association, including any wholly-owned subsidiary, majority-owned subsidiary, parent-country national, or affiliate of the business association, that exists for the purpose of making profit;
by inserting after paragraph (5), as so redesignated, the following:
the term fossil fuel entity means any entity—
with proven carbon reserves; or
that explores for, extracts, processes, refines, or transmits coal, oil, gas, oil shale, or tar sands;
in subsection (b)—
in paragraph (1)—
in subparagraph (E), by striking
and at the end;
in subparagraph (F), by striking the period at the end and inserting
; and; and
by adding at the end the following:
a Climate Choice Stock Index Fund as provided in paragraph (6).
by adding at the end the following:
The Board shall select an index which is a commonly recognized index comprised of common stock.
The historical performance of the index selected under subparagraph (A) shall be comparable to that of the other investment funds and options available under this subsection.
The Climate Choice Stock Index Fund shall be invested in a portfolio that is designed—
to replicate the performance of the index selected under subparagraph (A);
such that, to the extent practicable, the percentage of the Climate Choice Stock Index Fund that is invested in each stock is the same as the percentage determined by dividing the aggregate market value of all shares of that stock by the aggregate market value of all shares of all stocks included in the index selected under subparagraph (A); and
to ensure that no investment in the portfolio is an investment with respect to a fossil fuel entity.
Government Accountability Office report
In this section, the term fossil fuel entity has the meaning given the term in section 8438(a) of title 5, United States Code, as amended by this Act.
Not later than 1 year after the date of enactment of this Act, the Comptroller General of the United States shall submit to Congress a report that—
analyzes, as of that date of enactment—
the proportion of the stocks, bonds, and other obligations held by the Thrift Savings Fund that are stocks, bonds, or other obligations of a fossil fuel entity; and
the effect on individuals holding accounts in the Thrift Savings Fund of the Thrift Savings Fund holding stocks, bonds, or other obligations of fossil fuel entities under the climate policies that would be needed to limit global temperature increase to 2 degrees Celsius, given technology that is available and economically feasible as of that date of enactment; and
provides a plan and mechanism that would allow the Federal Retirement Thrift Investment Board to divest from fossil fuel entities to prevent or mitigate any negative investment risk on individuals holding accounts in the Thrift Savings Fund.