Get Full Government Meeting Transcripts, Videos, & Alerts Forever!
Get email alerts on the State Investments topic
No spam. Unsubscribe anytime.
Board of Investments opposes bill that would bar state investment in securities not subject to PCAOB audits
Summary
Senate Bill 459 would require divestment from securities listed in jurisdictions where the Public Company Accounting Oversight Board (PCAOB) cannot conduct oversight. The board’s executive director said the change could impose costs, conflict with constitutional fiduciary duties and require new reporting and segregation of assets.
Sen. Ken Bogner opened the hearing on Senate Bill 459 by telling the committee the bill would ensure Montana public funds are invested in securities for which public audits are available under the Public Company Accounting Oversight Board.
Dan Villa, executive director of the Montana Board of Investments, testified in opposition. Villa told the committee the board manages multiple pools with distinct constitutional duties and investment mandates and that applying a PCAOB‑only test across pools could conflict with the board’s fiduciary duty and the constitutional language that governs certain trust and pension pools. He said the board invests in a mix of “risk‑on” and “risk‑off” assets and that adding a statutory PCAOB compliance filter would force new segregation, reporting and likely higher costs. Villa also said the bill could force divestment from equities in certain allied countries and named Poland and Qatar as examples where required action could follow the statute’s current draft.
Sponsor Bogner said the intention is narrower: public dollars should be invested in securities that are auditable so trustees and the legislature can know what is being purchased and used. Committee questions focused on constitutional duties of the board and the fiscal effects of forced divestment; Villa said the bill would likely produce additional reporting and compliance costs and could reduce returns for some beneficiaries.
No committee action was recorded in the transcript; the board said it would work with the sponsor on refinements.
