Massachusetts 2025-2026 Regular Session

Massachusetts House Bill H2983 Compare Versions

Only one version of the bill is available at this time.

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2	2	HOUSE DOCKET, NO. 995 FILED ON: 1/14/2025
3	3	HOUSE . . . . . . . . . . . . . . . No. 2983
4	4	The Commonwealth of Massachusetts
5	5	_________________
6	6	PRESENTED BY:
7	7	Erika Uyterhoeven
8	8	_________________
9	9	To the Honorable Senate and House of Representatives of the Commonwealth of Massachusetts in General
10	10	Court assembled:
11	11	The undersigned legislators and/or citizens respectfully petition for the adoption of the accompanying bill:
12	12	An Act concerning investments of the Massachusetts Pension Reserve Investment Management
13	13	(PRIM).
14	14	_______________
15	15	PETITION OF:
16	16	NAME:DISTRICT/ADDRESS :DATE ADDED:Erika Uyterhoeven27th Middlesex1/14/2025 1 of 5
17	17	HOUSE DOCKET, NO. 995 FILED ON: 1/14/2025
18	18	HOUSE . . . . . . . . . . . . . . . No. 2983
19	19	By Representative Uyterhoeven of Somerville, a petition (accompanied by bill, House, No.
20	20	2983) of Erika Uyterhoeven relative to certain investments of the Massachusetts Pension Reserve
21	21	Investment Management. Public Service.
22	22	The Commonwealth of Massachusetts
23	23	_______________
24	24	In the One Hundred and Ninety-Fourth General Court
25	25	(2025-2026)
26	26	_______________
27	27	An Act concerning investments of the Massachusetts Pension Reserve Investment Management
28	28	(PRIM).
29	29	Be it enacted by the Senate and House of Representatives in General Court assembled, and by the authority
30	30	of the same, as follows:
31	31	1 Chapter 32 of the General Laws is hereby amended by adding the following section:
32	32	2 For domestic equity investments in the private real estate, private equity, and private
33	33	3infrastructure asset classes, including partnerships, joint ventures, co-investment vehicles,
34	34	4commingled investments, and direct investments entered into after the enactment of this bill in
35	35	5which MassPRIM has an equity interest greater than 50 percent, either directly or through one or
36	36	6more external managers, the Chief Investment Officer (CIO) or the external manager shall
37	37	7require that all developers and operators of enterprises thus financed must as a condition of the
38	38	8pension system’s funding of the investment agree to, and abide by, the following requirements:
39	39	9with respect to any construction-related activities financed by the investment, to use good faith
40	40	10efforts to ensure that responsible contractors are included in the bidding by, and selection of, all
41	41	11contractors and subcontractors at any tier performing any construction, delivery to the job site of
42	42	12major construction materials, maintenance, repair, or restoration, including, without limitation, 2 of 5
43	43	13alterations, additions, improvements, painting, installations of fixtures, mechanical, electrical,
44	44	14plumbing, or with respect to any other construction or installation-related work, and structures,
45	45	15equipment and systems fabricated for a specific job site.
46	46	16 A contractor shall be excluded from bidding on projects if such contractor or any of its
47	47	17senior officials has been debarred in the 36 months preceding the bidding deadline by a
48	48	18governmental authority for failure to pay prevailing wages or benefits on any prior job for which
49	49	19it is required by law. A responsible contractor is one which: submits to the property or external
50	50	20manager a responsible contractor self-certification on a form acceptable to the CIO;
51	51	21communicates and furnishes this section to subcontractors; provides the CIO and the external
52	52	22manager with responsible contractor documentation; selects subcontractors in a manner
53	53	23consistent with this section; and pays workers fair wages and fair benefits including employer-
54	54	24supported family health care coverage, pension benefits and state registered apprenticeship
55	55	25training programs, based on relevant market factors that include the nature and location of the
56	56	26project, comparable job or trade classifications, and the scope and complexity of the work.
57	57	27 With respect to any long-term operations financed by the investment, that any operator of
58	58	28such operations shall make a good faith effort to secure an agreement with a bona fide labor
59	59	29organization requesting to enter in to such an agreement solely with respect to such operations in
60	60	30which the labor organization agrees not to strike, picket, boycott, or take economic action against
61	61	31the operations for the duration of the investment. A bona fide labor organization is one which is a
62	62	32member of either the AFL-CIO or Change to Win, and has at least 100 collective bargaining
63	63	33agreements or 50,000 members in the same industry as the long- term operations. 3 of 5
64	64	34 For domestic equity investments in the private real estate, private equity and private
65	65	35infrastructure asset classes, including partnerships, joint ventures, co-investment vehicles,
66	66	36commingled investments, and direct investments entered into after the enactment of this bill, in
67	67	37which the Mass PRIM has an equity interest equal to or less than 50 percent, the CIO shall
68	68	38encourage external managers to follow the practices of this section and shall give preference in
69	69	39the selection of external managers and placement of additional investments to those which
70	70	40provide the best level of return at an acceptable level of risk and follow such practices.
71	71	41 The CIO of Mass PRIM shall not approve any investment that has the potential to
72	72	42eliminate public sector jobs, would pose a reputational risk to the State-administered retirement
73	73	43systems, or could bring public or regulatory scrutiny to the retirement systems.
74	74	44 Before presenting any investment to Mass PRIM for possible investment, the CIO shall
75	75	45identify any features of the proposed investment that could potentially lead to significant loss of
76	76	46public sector jobs, pose reputational risks, or subject the retirement systems to regulatory
77	77	47scrutiny.
78	78	48 The CIO, subject to the direction of Mass PRIM’s Board, shall exercise due diligence in
79	79	49the selection of external managers. The CIO shall consider at least the following factors about
80	80	50the external manager and companies in its current and historical portfolios: any violations, fines,
81	81	51citations, or findings by a state or federal regulatory agency, including but not limited to,
82	82	52environmental fines and violations, unfair labor practices, or OSHA fines and violations; the
83	83	53record of securing labor peace agreements with labor organizations; disputes with labor
84	84	54organizations in the previous five years and the outcomes of such disputes; any complaints about
85	85	55the external manager, its portfolio companies or construction contractors received from 4 of 5
86	86	56concerned citizens or organizations; and whether the external manager proposes an investment
87	87	57strategy that is premised on, or has the potential to create, significant public sector job loss.
88	88	58 Prospective external managers and their portfolio companies shall be of good character
89	89	59and shall have demonstrated observance of local, state, and national laws (including, by way of
90	90	60illustration, those related to insurance, taxes, labor, anti- discrimination, environmental, and
91	91	61occupational health and safety). External managers and their portfolio companies shall be
92	92	62evaluated for their record of compliance with the policies, including any responsible contractor
93	93	63policies of public pension plans for which they serve or have served as external managers and
94	94	64shall be required to disclose any instances of non-compliance with such policies and to certify
95	95	65that they and their portfolio companies are not out of compliance with any such policies at the
96	96	66time of any proposed investment by Mass PRIM. External managers shall have demonstrated a
97	97	67past practice of, and capacity for, managing risks, including, without limitation, investment risks,
98	98	68interest rate risks, compliance risks, the risk of labor disputes, and the risk of malfeasance or
99	99	69ineptitude on the part of contractors, subcontractors, or operators. Whenever possible, external
100	100	70managers shall be chosen by competitive bidding and evaluated on their likelihood of producing
101	101	71competitive, risk-adjusted rates of return.
102	102	72 The report of Mass PRIM on the performance of external managers shall include
103	103	73identification of all investments held as of the date of the report that are in violation of Section
104	104	74106 of Chapter 32 of the M.G.L. Mass PRIM and the CIO may take appropriate action to sell,
105	105	75redeem, divest, or withdraw any investment held in violation of Section 106 of Chapter 32 of the
106	106	76M.G.L., when efforts to cure the violation are unsuccessful. This section shall not be construed to
107	107	77authorize the premature or otherwise imprudent sale, redemption, divestment, or withdrawal of
108	108	78an investment. 5 of 5
109	109	79 This act shall take effect 180 days following the date of enactment except the CIO may
110	110	80take any anticipatory administrative action in advance as shall be necessary for the
111	111	81implementation of this act.