Alabama Senate Bill SB251

Alabama 2024 Regular Session

• Introduced: 3/21/24
• Report Pass: 4/4/24
• Refer: 3/21/24
• Refer: 4/9/24

Caption

Public Investments; to prohibit Board of Control of ERSA and TRSA from investing with restricted entities affiliated with Communist Chinese military companies

Impact

The implications of this bill on state laws include the introduction of stringent criteria for investment by the Teachers' Retirement System and the Employees' Retirement System of Alabama. As outlined in the bill, these systems would be required to divest from any identified restricted entities, thereby enforcing a more cautious approach to public investment. The establishment of a list of restricted entities, curated by the State Auditor, aims to provide clarity and guidance for compliance, affecting both current holdings and future investment strategies of these retirement systems.

Summary

SB251 addresses concerns over financial investments made by Alabama's public retirement systems, specifically targeting investments in entities affiliated with the Communist Chinese military. The bill seeks to align state investment activities with existing federal mandates, particularly those outlined in Presidential Executive Orders aimed at counteracting national security threats. By prohibiting investments in certain publicly traded securities linked to these entities, the legislation intends to mitigate risks perceived from financial ties to the Chinese military infrastructure.

Contention

There are notable points of contention surrounding SB251, especially regarding concerns of overreach and the broader implications for international trade and investment. Opponents may argue that the bill could lead to a chilling effect on investments in potentially vital industries. This legislation’s focus on Chinese entities may also spark debates about economic relationships with global markets, questioning whether such restrictions could harm public investment portfolios or limit growth opportunities for Alabama's retirement funds.