SB261INTRODUCED
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83V3H2-1
By Senators Roberts, Orr, Allen, Livingston, Stutts, Shelnutt,
Sessions
RFD: Fiscal Responsibility and Economic Development
First Read: 27-Apr-23
2023 Regular Session
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7 83V3H2-1 04/25/2023 PMG (L)tgw 2023-1629
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SYNOPSIS:
This bill would prohibit a governmental entity
from entering into a public contract for goods or
services with certain companies or businesses that
engage in the economic boycott of businesses in certain
sectors and industries; that fail to meet or commit to
meet certain environmental standards; that fail to meet
or commit to meet certain corporate governance
criteria; or that fail to facilitate certain
activities.
This bill would prohibit any company in the
state from being required to engage in economic
boycotts or other actions that further social,
political, or ideological interests, including economic
boycott criteria.
This bill would prohibit any company in the
state from being penalized for declining to engage in
economic boycotts or other actions that further social,
political, or ideological interests, including economic
boycott criteria.
This bill would require the Attorney General to
seek to prohibit the adoption of federal laws or
actions that may penalize, inflict harm on, limit
commercial relations with, or change or limit the
activities of companies or residents of the state based
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on the furtherance of economic boycott criteria.
This bill would also authorize the Attorney
General to investigate violations of and enforce this
act.
A BILL
TO BE ENTITLED
AN ACT
Relating to public contracts; to prohibit governmental
entities from entering into certain contracts with companies
that boycott businesses because the business engages in
certain sectors or does not meet certain environmental or
corporate governance standards or does not facilitate certain
activities; to provide that no company in the state shall be
required, nor penalized for declining to engage in economic
boycotts or other actions that further social, political, or
ideological interests; to require the Attorney General to take
actions to prevent federal laws or actions from penalizing,
inflicting harm on, limiting commercial relations with, or
changing or limiting the activities of companies or residents
of the state based on the furtherance of economic boycott
criteria; and to authorize the Attorney General to investigate
and enforce this act; and to provide definitions.
BE IT ENACTED BY THE LEGISLATURE OF ALABAMA:
Section 1. As used in this act, the following terms
have the following meanings:
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(1) COMPANY. A for-profit entity, organization,
association, corporation, partnership, joint venture, limited
partnership, limited liability partnership, or limited
liability company, including a wholly owned subsidiary,
majority-owned subsidiary, parent company, or affiliate of
those entities or business associations. The term does not
include sole proprietorships.
(2) ECONOMIC BOYCOTT. Without an ordinary business
purpose, refusing to deal with, terminating business
activities with, or otherwise taking any commercial action
that is intended to penalize, inflict economic harm on, limit
commercial relations with, or change or limit the activities
of a company because the company, without violating
controlling law, does any of the following:
a. Engages in the exploration, production, utilization,
transportation, sale, or manufacturing of fossil fuel-based
energy, timber, mining, or agriculture.
b. Engages in, facilitates, or supports the
manufacture, import, distribution, marketing or advertising,
sale, or lawful use of firearms, ammunition, or component
parts and accessories of firearms or ammunition.
c. Does not meet, is not expected to meet, or does not
commit to meet environmental standards or disclosure criteria,
in particular to eliminate, reduce, offset, or disclose
greenhouse gas emissions.
d. Does not meet, is not expected to meet, or does not
commit to meet corporate employment or board composition,
compensation, or disclosure criteria.
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e. Does not facilitate, is not expected to facilitate,
or does not commit to facilitate access to abortion or sex or
gender change surgery, medications, treatment, or therapies.
f. Does business with a company described by paragraphs
a. through e.
(3) GOVERNMENTAL ENTITY. A state agency, department,
regulatory body, board, bureau, or commission, or any county,
municipality, incorporated or unincorporated local government,
or other political subdivision of the state.
(4) ORDINARY BUSINESS PURPOSE. Excludes any purpose to
further social, political, or ideological interest, including,
but not limited to, economic boycott criteria or other
similarly oriented rating. A company may reasonably be
determined to have taken an action, or considered a factor,
with a purpose to further social, political, or ideological
interests based upon evidence indicating such a purpose,
including, but not limited to: (i) branding, advertising,
statements, explanations, reports, letters to clients,
communications with portfolio companies, statements of
principles, or commitments, or (ii) participation in,
affiliation with, or status as a signatory to any coalition,
initiative, joint statement of principles, or agreement.
Section 2. (a) This section applies only to a contract
that meets both of the following:
(1) Is between a governmental entity and a company with
10 or more full-time employees.
(2) Will pay or may pay a company at least fifteen
thousand dollars ($15,000) over the term of the contract
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wholly or partly from public funds of the governmental entity;
provided, however, this subdivision shall apply separately to
all companies in a multiple-party contract.
(b) Except as provided by subsection (c), a
governmental entity may not enter into a contract with a
company for goods or services unless the contract contains a
written verification from the company that the company does
not and will not, during the term of the contract, engage in
economic boycotts.
(c) Subsection (b) does not apply to a governmental
entity that determines the requirements of subsection (b) are
inconsistent with the governmental entity's constitutional or
statutory duties related to the issuance, incurrence, or
management of debt obligations or the deposit, custody,
management, borrowing, or investment of funds, or would
prevent the governmental entity from obtaining the supplies or
services to be provided in an economically practicable manner.
(d) If a governmental entity is unable to comply with
this section without significantly increasing costs or
limiting the quality of options or services available, or
both, the governmental entity may waive the requirements upon
a finding, posted on the governmental entity's publicly
available website that:
(1) The governmental entity has made reasonable and
good faith efforts to obtain services meeting the requirements
of this section and has included the requirements in the
governmental entity's minimum selection criteria.
(2) Based on objective information available to the
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governmental entity, the cost appears significantly higher
than the services available to similarly oriented governmental
entities not subject to similar requirements, or the quality
of services or options appears significantly lower than the
quality of services available to similarly oriented
governmental entities not subject to similar requirements, or
both.
(3) The governmental entity determines that a waiver is
clearly in the best interest of its constituents.
Section 3. (a) No party may take action to penalize or
threaten to penalize any governmental entity, company, or
business for compliance with Section 2.
(b) Any party violating a commitment made under
subsection (b) of Section 2 or otherwise violating subsection
(a) of this section shall have caused harm to the governmental
entity, including by interfering with the governmental
entity's sovereign interest in administering its programs and
with the governmental entity's commercial relationships.
Section 4. (a) No company in this state shall be
required to engage in economic boycotts, to establish or
implement policies, procedures, guidelines, rules, reports,
products, services, notices, disclosures, or rates or pricing;
to provide or submit answers to surveys or other information
requests or disclosures; to invest in or divest of certain
securities, stocks, bonds, bills, partnerships, or other
investment arrangements; or to initiate other corporate or
business practices that further social, political, or
ideological interests including, but not limited to, economic
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boycott criteria or other similarly oriented rating.
(b) No company in this state shall be penalized, have
economic harm inflicted on it, have commercial relations
limited, or have the activities of the company changed or
limited because the company will not engage in economic
boycotts; will not establish or implement policies,
procedures, guidelines, rules, reports, products, services,
notices, disclosures, or rates or pricing; will not provide or
submit answers to surveys or other information requests or
disclosures; will not invest in or divest of certain
securities, stocks, bonds, bills, partnerships, or other
investment arrangements; or will not initiate other corporate
or business practices that further social, political, or
ideological interests including, but not limited to, economic
boycott criteria or other similarly oriented rating.
Section 5. The Attorney General shall seek to prohibit
the adoption of federal laws, rules, regulations, bulletins,
executive orders, or other federal actions that may penalize,
inflict economic harm on, limit commercial relations with, or
change or limit the activities of a company in the state or a
resident of the state based on the furtherance of economic
boycott criteria or other similarly oriented rating.
Section 6. If any provision of this act or its
application to any person or circumstances is held invalid,
then the invalidity does not affect other provisions or
applications of this act, which can be given effect without
the invalid provision or application, and to this end the
provisions of this act are severable.
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Section 7. (a) This act may be enforced by the Attorney
General.
(b) If the Attorney General has reasonable cause to
believe that a person has engaged in, is engaging in, or is
about to engage in a violation of this act, he or she may
investigate according to the investigative authority provided
in Section 8-19-9, Code of Alabama 1975.
(c) The Attorney General may use all remedies available
at law or in equity to enforce this act. In addition to any
other remedies available at law or in equity, a company that
serves as a fiduciary and that violates this act or any
commitment made under this act shall be obligated to pay
damages to the state in an amount equal to three times all
monies paid to the company by the governmental entity or plan
for the company's services.
Section 8. This act shall become effective on the first
day of the third month following its passage and approval by
the Governor, or its otherwise becoming law.
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