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Bill to limit state investments in jurisdictions without PCAOB oversight draws opposition from board
Summary
Sen. Ken Bogner’s SB 459 would direct divestment from securities listed in jurisdictions where the PCAOB cannot conduct oversight. The Board of Investments testified in opposition, arguing the measure could conflict with constitutional fiduciary duties and impose large portfolio and administrative costs.
Senator Ken Bogner described Senate Bill 459 as an effort to ensure state trust funds are invested in securities subject to independent audit oversight.
"Public dollars… should be invested prudently," Bogner said, and the draft requires divestment where the Public Company Accounting Oversight Board (PCAOB) cannot conduct oversight. Dan Villa, executive director of the Board of Investments, testified in opposition, saying the board must balance many risk metrics, that several allied jurisdictions are not PCAOB‑compliant and that the proposal could force divestiture of substantial holdings (including some allied countries). Villa warned of administrative burdens, additional filings, and potentially large market impacts.
Committee discussion explored the constitutional duties of the Board of Investments, jurisdictions affected, and the possibility of refining the bill if PCAOB structures change. The sponsor said he wanted public dollars invested where audits are meaningful and pledged to work on technical fixes if needed.
