Business & Economy

Divestment task force member resists challenge to his objectivity

The chairman of the state pension fund oversight committee has refused to recuse himself from deliberations on whether to divest the fund of certain fossil fuel assets, after three environmental groups accused him of lacking objectivity.

Representatives of three Vermont environmental nonprofits asked Tom Golonka, the chairman of the Vermont Pension Investment Committee, to step aside, saying his public comments have included a statement that past evidence showed divestment would be “an expensive way to approach something that has minimal impact.”

The letter to Golonka, written by Lauren Hierl of Vermont Conservation Voters, James Ehlers of Lake Champlain International, and Johanna Miller of the Vermont Natural Resources Council, questions Golonka’s ability to “undertake an open, fair and unbiased analysis” of the wisdom of divestment.

In his written response to the advocates, Golonka said it’s imperative to ask critical questions before potentially implementing a change.

In an interview Thursday, Golonka said he would not step down from a subcommittee evaluating the idea of divestment. “I read their letter, and I have no intention of recusing myself,” he said.

Golonka said he’s “impartial to the point that I’m willing to hear arguments for and against” divestment.

If divesting the retirement account of certain fossil fuel assets will bring the same returns for the same investment, or if doing so will make more money with less risk, Golonka said, he’ll support divestment.

Golonka is a member of a subcommittee State Treasurer Beth Pearce agreed to form as part of a recent deal with legislators who have called for divestment of Exxon Mobil, coal and other fossil fuel assets. Legislators at the time said they asked her to form a committee as a way to move forward on the issue without passing laws ordering divestment.

Gov. Peter Shumlin has been a driver of the effort to divest.

Golonka has said that a study the Vermont Pension Investment Committee commissioned last year showed that divestment of fossil fuel assets would cost the fund extraordinary amounts in lost revenue and fees. Critics say the study was written not to discover whether divestment could be done affordably, but to demonstrate that it would be costly for the state to divest itself immediately of all fossil fuel assets and replace them with renewable energy assets.

The divestment subcommittee of which Golonka is a member is charged with finding an answer to the former question.

Depending on how it is calculated, the state has as little as $700 to as much as $1.1 million in coal assets, and about $200,000 in Exxon Mobil.

The divestment subcommittee is scheduled to hold its first two meetings Wednesday and April 26.

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  • Renée Carpenter

    “The letter to Golonka, written by Lauren Hierl of Vermont Conservation Voters, James Ehlers of Lake Champlain International, and Johanna Miller of the Vermont Natural Resources Council, questions Golonka’s ability to “undertake an open, fair and unbiased analysis” of the wisdom of divestment.”

    He must not be reading the news: Coal going down, fracking causing earthquakes & inducing huge protests across the country, even Exxon Mobil profits are down … and then there’s the recent (another) pipeline spill disaster. How can this be a good place for Vermonters’ retirement funds to be invested?

    Golonka must be “asked” to step down!

    Thanks for the reporting!

  • Kim Fried

    It’s just amazing that these special interest groups/lobbyists just can’t leave the state employee and teacher’s retirement program alone. Are they looking for a cash pay out to go away?? An MOU or a mitigations plan?? Don’t be surprised, that is how these groups operate. It’s disgusting and to think this is Vermont or what is left of it.

  • Robert Lehmert

    I’ve heard about bond-like and unit-investment solar projects that are designed to spin off income and pass through the effects of tax benefits so that they could be used by tax exempt entities like pension plans. The idea is to pool significant amounts of capital to develop large geographically dispersed solar farms that would spin off income for decades. The rates of return are said to be very competitive with conventional fixed income yields.

    There might be a good fit with the investment requirements of the state pension plans– especially given the scale of capital invested in fossil fuel companies.

    For example,
    http://www.prnewswire.com/news-releases/solar-farm-company-offering-265mw-of-projects-for-86-34-irrs-300225333.html

  • Nobody in Montpelier — or indeed, anywhere else — is objective.

    Demonstrate conflict of interest or use your donor money for more meaningful campaigns, because this one is going nowhere.

  • Mary Alice Bisbee

    I strongly agree with those who are more concerned about the state of our planet and our future as human beings on this planet, than those who feel that short term business decisions affecting rates are the only concern these investment funds should consider. The term “fiduciary responsibility” keeps floating around. What about our responsibility to the planet, future generations and most likely the bottom line in the future as well? It will do very little good if we save investment returns if we as humans are unable to live on our planet. Mr. Golonka needs to resign, and now!

  • Paul Richards

    It sounds like Mr. Golonka is the only one on the committee that has any real objectivity. This is the way liberals operate; if they can’t have 100% control of the process they discredit anyone who threatens their ideology. Besides all of that, there is no good reason why we are wrapped up this this mess in the first place. Public sector unions should be outlawed once again and these plans should be completely controlled by the benefactors of the plan including 100% of the funding for it.

  • Edward Williams

    Sounds like Golonka is the only party discussed herein who IS unbiased and NOT beholding to the environmental lobbyists and big money green activists.

  • Rowan Nelson

    Maybe a more important question is whether or not the state should be managing the retirement funds in the first place. It seems individuals should be able to take the funds that are put in the Vermont Pension on their behalf and instead invest them in funds of their choosing (using existing financial tools such as IRAs). In doing so the good folks in Montpelier could focus on important state business like clean water and sound public infrastructure. People like Golonka would be able to contribute to those efforts as opposed to stalwarting.

  • Robert Lehmert