LOS ANGELES — Los Angeles Mayor Antonio Villaraigosa, spurred by a bill signed last month by Gov. Arnold Schwarzenegger, is asking the city's three largest pension plans to find out how much of their investments are in companies with ties to Sudan.
In June, Mr. Villaraigosa initially asked for information on how much the funds — the $13.8 billion Los Angeles Fire & Police Pension System, $9.1 billion Los Angeles City Employees' Retirement System, and the $6.5 billion Los Angeles Water and Power Employees' Retirement Fund — hold in Sudan-related investments.
The Los Angeles City Council on June 7 passed a resolution to support state legislation that prohibits the state's two largest pension funds from investing in companies with active business in Sudan and indemnifies the $88 billion University of California Board of Regents, Oakland, from liability for divesting its Sudan investments. The two bills were signed into law by Gov. Arnold Schwarzenegger on Sept. 25. They require the $220.1 billion California Public Employees' Retirement System and $148.8 billion California State Teachers' Retirement System, both in Sacramento, and the University of California to sell or transfer investments from companies with active business operations in Sudan. However, unlike the new state laws, Mr. Villaraigosa has left it to pension fund officials to decide whether to divest.
So far, the three boards are conducting investigations. The LACERS board voted to ask the city attorney's office and its staff about various alternatives, including divestment and ongoing monitoring of Sudanese governance issues. No timetable for a report was set, according to Robert Aguallo Jr., general manager. So far, the board sent letters to 21 public companies linked by news reports to Sudan investment, asking for details. The system does not have holdings in all of the companies, but officials are sending letters to the entire list in the event they have future holdings. Responses are due Oct. 30.
The fire and police system board directed staff to coordinate with the city attorney's office and develop a divestiture plan for their holdings, said Tom Lopez, chief investment officer.
System officials have identified the plan's investment in two companies on the UC Regents' list: China Petroleum and Chemical Corp. and PetroChina Co. Ltd.
The city water and power fund's board formed a committee to look into the issue of investments in Sudan, said Sangeeta Bhatia, retirement plan manager.