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During its June 11 meeting, the Ohio Police & Fire Pension Fund (OP&F) Board of Trustees voted to officially oppose Substitute House Bill 151 that is currently under consideration before the Ohio General Assembly.
If passed into law, the bill would mandate that Ohio�s five public retirement systems divest interests in specific foreign companies that have business ties to Iran and Sudan. Preliminary research done on behalf of the retirement systems reveals a list of 74 companies that would fall under this mandate. OP&F owns investments in 15 of these companies worth approximately $208 million.
The Ohio Retirement Study Council, a committee charged with overseeing the state�s pension funds, has already recommended that the retirement systems not support the bill. Until the Board�s vote, OP&F was officially neutral on the proposed legislation, preferring to wait and see the language in the bill�s final version. While the current version of the bill is much less damaging to OP&F�s investment portfolio than the original version introduced this spring, it will still cost OP&F money to sell the affected stocks, pay for transaction costs and re-invest the money � perhaps in securities that could potentially have lower returns.
Before voting, the Board had a prolonged discussion on the issue, stated that this is a foreign policy debate that should be dealt with on the federal level, and is not the responsibility of the retirement systems. The mandate would also appear to be in conflict with the Board�s fiduciary responsibility to act in the best interests of its members.