ALBANY, NY – Hundreds of current and retired elected officials across New York State decried Comptroller Thomas DiNapoli’s refusal to heed years of expert warnings to divest the state pension fund from fossil fuels. Studies show that the decision has cost New Yorkers at least $25 billion, after adjusting for inflation.

More than 90 state lawmakers joined more than 230 local elected officials in urging the Comptroller to immediately begin phasing out oil, gas, and coal stocks from the Common Retirement Fund. Leading experts recognize that fossil fuels are a terrible investment for our pensioners and our state. 

“New York State pensions are intended to provide secure futures. The state should never gamble with them. But that’s exactly what’s happening in a high stakes game with New York State Comptroller Thomas DiNapoli investing state workers’ retirement funds in the fossil fuel industry. The retirement fund has lost at least $25 billion,” said Albany County Legislator William Reinhard. “That’s unconscionable.”

The letter from Elected Officials to Protect New York (EOPNY) calls on DiNapoli to take immediate action to phase out fossil fuels from the Common Retirement Fund. The letter cites the enormous costs of fossil fuels to New Yorkers, including at least  4,000 deaths and $33 billion in health costs annually in New York. EOPNY previously sent a bipartisan letter to DiNapoli in June 2017 urging that he divest the pension fund from the top 200 companies with the largest carbon-content fossil fuel reserves by 2020. That letter was signed by 239 local elected officials from all 62 counties (that letter is online at nyelectedofficials.org/investments). 

In December 2017, Governor Andrew Cuomo called for the state pension fund to divest from oil, gas, and coal stocks. Instead, Comptroller DiNapoli danced around the issue, resisting divestment of the Common Retirement Fund and pursuing ineffective shareholder engagement, despite repeated warnings and evidence from financial experts that the industry was in a downward financial spiral.

“For years, financial experts have been sharing data and research that supports the financial case for fossil fuel divestment for the exact reason we’re seeing now. These investments are an unnecessary risk inside of the Common Retirement Fund with research demonstrating that without exposure to these companies, the Fund would have $25 billion more than it does today. Our letter to Comptroller Dinapoli in 2017 urged him to act, which unfortunately for all New Yorkers, he did not. He should have divested years ago. But it’s better late than never,” said Katelyn Kriesel, Manlius Town Councilor and professional investment advisor. 

Fossil fuels are the worst performing sector in the S&P 500 over the past decade. Since 2015, North American fossil fuel businesses declared more than 215 bankruptcies. A recent analysis found that the funds’ investments in 16 tar sands and fracking companies declined in value by more than $1.5 billion in one year, long before the pandemic. 

While New York State’s Climate Leadership and Community Protection Act (CLCPA) aggressively weans us off fossil fuels to reach net zero greenhouse gas emissions, the Common Retirement Fund still invests heavily in fossil fuels. The Common Retirement Fund has at least $13.1 billion or 6.6% of the total portfolio in fossil fuel assets, including more than one billion dollars is Exxon stock and bonds. These investments fund coal mines, gas ports, pipelines, seafloor drilling, and tar sands extraction that worsen the climate crisis and cost our communities.

“We need to stop this hypocrisy and align our public investments accordingly. We cannot morally be investing our pensions into an industry that disregards the health and wellbeing of our citizens. Fossil fuel pollution causes more than 4,000 deaths annually in New York,” said Rochester Councilmember Mary Lupien. “We can build back better. Let’s start now by divesting from fossil fuels.”

Fossil fuel pollution is a major contributor to COVID deaths. A Harvard study in April found that people living in areas with heavy pollution particulates are 15 percent more likely to contract COVID-19. With the pandemic making us rethink how to rebuild our economies and where to stimulate growth many leaders are focusing on clean energy.

Renewable energy is now cost-competitive with fossil fuels in many sectors. Automakers are responding to robust demand for electric vehicles. Vehicle fleets across the country are converting to electric vehicles. With falling demand and the imperative to meet global climate goals, vast amounts of oil and natural gas reserves will need to be written off as stranded assets. Financial experts are warning that the fossil fuel sector, particularly shale and fracking and tar sands companies, will not recover.

The Comptroller’s pension fund gamble was blatantly obvious when oil prices plummeted below zero in April. Oil and gas market analysts expect a slate of job cuts and new bankruptcies across the globe. Yet, a fossil-free stock index has steadily outperformed the global stock market as a whole over the past decade. The tide has turned in favor of investing in clean technologies and divesting from dirty polluting fossil fuels. Investments in clean energy are a win-win.

More than 60 State Assembly members and 32 Senators have co-sponsored the Fossil Fuel Divestment Act (S2126A/A1536A), which would limit the investments of public pension funds in fossil fuels.

New York City has committed to divesting from the pension fund from fossil fuels but the state still needs to get on board.

Last week, Cornell University trustees voted to divest their $6.9 billion endowment fund from fossil fuels. Globally, more than $14.1 trillion in assets from nearly 1,200 institutions are phasing out investments in fossil fuels, including more than 230 faith-based organizations. As the global market rapidly turns against the industry, due to SEC rules enabling companies to exclude shareholder resolutions that inhibit their core business, shareholder engagement with the fossil fuel industry will not protect our pensioners.

New York must divest in fossil fuels to keep the pensions so many worked so hard for—safe. We have to stop gambling with retirement funds workers depend on. It’s their futures.

At a time when buying groceries is risky, state workers don’t need the added stress of worrying about their pensions. Comptroller DiNapoli must act now and start the fossil fuel divestment process.

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