UPDATE: Kentucky Senate passes bill aimed at energy boycotts

The bill would keep state government from doing business with financial companies that cut their investments in fossil fuels

Update from March 8, 2022:

FRANKFORT, Ky. (AP) — The Kentucky Senate has passed legislation that would keep the state’s government from doing business with financial companies that have decided to cut their investments in fossil fuels.

The bill passed the Republican-dominated Senate 26-5 on Monday and now awaits House input.

Under the legislation, the Kentucky state treasurer would be required to publish, maintain and update a list of financial companies engaged in energy company boycotts. That list would then be shared with state government entities making investments of more than $1 million annually. If a financial company did not end the boycott, the bill would require that the state government entity divest from those holdings.

GOP Sen. Robby Mills, lead sponsor of the bill, said that divestment would not be required “if reasonable evidence shows that it would cause the government entity to suffer a loss.”

During debate on the bill, Democratic Sen. David Yates warned that the bill would make it difficult for the state to attract new businesses.

“This legislation creates a blacklist that’s going to make it very difficult for us to go and recruit these companies to locate and create jobs of the future,” he said.

 

Original story below from March 3, 2022:

FRANKFORT, Ky. (AP) — A Kentucky Senate panel has advanced a proposal that would keep state government from doing business with financial companies that have decided to cut their investments in fossil fuels.

It would also require the Kentucky state treasurer to publish, maintain and update a list of financial companies engaged in energy company boycotts. That list would then be shared with state government entities making investments of more than $1 million annually. If a financial company does not end the boycott, the bill would require that the state government entity divest from those holdings.

“Energy policies, in my opinion, should be created by the legislators in Kentucky, not in the board rooms of publicly traded banks and investment firms around the nation and country,” Republican Sen. Robby Mills said.

Mills clarified that the bill allows for an exception if “reasonable evidence shows that divesting from the specific financial company would cause state government entities to suffer a loss.”

In testimony against the bill, Kentucky Banking Association President Ballard Cassady warned that the legislation would “be a treatment that is more deadly than the disease” if enacted.

“While some banks are choosing to limit their relationships with fossil fuel companies, there’s no evidence these fossil fuel companies are not finding other financial institutions who will welcome them in,” he added.

 

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