Board counsel recommends following state 'scrutinized companies' guidance; briefs trustees on Supreme Court ruling about retiree health purchase rules

Bonnie (identified in the meeting as "Miss Bonnie") briefed the board on two legal items on Sept. 15.

First, she described a state requirement tied to the Florida State Board of Administration’s "scrutinized companies" list, which identifies companies deemed to boycott Israel; she said the list currently contains roughly 18 names, many tied to Unilever and its subsidiaries (Ben & Jerry’s was cited as an example). Bonnie recommended the board update its investment policy guidelines to adopt the state’s restriction language and to add contract clauses that would allow termination without cost if a counterparty is placed on the scrutinized list. She said no immediate action was required but recommended staff and counsel work with the investment adviser to prepare a policy amendment and file it with the state if adopted.

Second, Bonnie summarized a United States Supreme Court decision arising from a City of Sanford case involving retiree eligibility to purchase municipal health insurance. She explained the Court found the plaintiff invoked the wrong federal statutory basis (the Americans with Disabilities Act) for relief, so the Court did not reach the substantive question whether a municipality may limit disability retirees’ eligibility periods for purchasing health insurance. Bonnie said the ruling leaves an open question about the underlying statutory interpretation under state law and that she is monitoring for any implications to Edgewater’s benefit policies.

Trustees had brief verbal reactions but did not take immediate action on either item during the recorded meeting; Bonnie said staff would work with counsel and the investment adviser to draft any recommended policy changes.