Last fall's contentious presidential campaign may give a boost to a bill that failed last legislative session despite bipartisan support.
Members of the Legislature wanted to take a stand against genocide in Darfur by banning state investments in companies that support the government of Sudan. An effort to do that failed last year after top state investment managers balked at the restriction and some Republican legislators stopped a divestment bill in committee.
This year the effort is back, with the bill's sponsors thinking the high-profile issue will have more success.
"It should be fundamental that we don't support regimes such as this," said Rep. Beth Kerttula, D-Juneau, who is a sponsor of one of the divestment bills this year.
Opponents, however, say divestment will be complicated and potentially costly to implement, and will do little or nothing to stop investment in Sudan. For a time last year, those opponents included the Palin administration.
In Palin's vice-presidential debate with Democrat Joe Biden, Palin boasted of her support for divestment of Alaskan money from Sudan. Democratic Rep. Les Gara of Anchorage was quick to point out it was opposition from Permanent Fund and state Treasury Division managers that caused it to fail in the last Legislature, despite Palin announcing her support too late in the session for it to pass.
This session, five divestment bills have already been introduced, including from Palin.
"This is unprecedented, where we have a recognized genocide that's being labeled as such while its happening," said Pat Galvin, Commissioner of the Department of Revenue, which manages billions in retirement and other government funds. He also serves as a trustee of the Alaska Permanent Fund, which manages another $28 billion.
Concerns among lawmakers surround the effectiveness of divestment as a tactic, fearing that it will having little effect on the Sudanese government.
State Rep. Peggy Wilson, R-Wrangell, worried that Alaska's divestment efforts might be easily avoided by companies doing business in Sudan.
"They're going to get around it and do it anyway," she said, adding that she supports the intent, but feared unethical businesses know how to avoid such laws.
"They dissolve one (limited liability company) and make another one and come in as another name," she said.
Gara maintained that it would work, and it was important for the state to take any action it could.
"We don't want to make money off genocide, we don't want money that's tainted," he said.
The opponents don't dispute that, but doubt the usefulness of the bills.
"It's just impossible for me to come up with a way to do what we want to do, which is divest from Darfur," said Rep. Carl Gatto, R-Palmer, often a Palin ally on other issues.
Direct investments in Sudan are already against U.S. law, but the divestment effort aims to target foreign companies supporting Sudan's oil industry, such as PetroChina. Alaska holds about $14 million in stock in that company.
The Sudanese military uses oil profits to fund its campaigns in Darfur.
"There are a small handful of these companies operating in Sudan," Gara said.
State officials are developing cost estimates for divestment. Divestment supporters last year said estimates were unrealistically high, but state officials say the process of monitoring multiple money managers would be cumbersome.
Exemptions in the bills would likely be made for mutual fund-type investments and stock index funds.
"We want one of these bills to move forward, and frankly we don't care which one it is," Gara said.
Lynn agreed, and several legislators said they all may choose to back the Palin bill.
Contact reporter Pat Forgey at firstname.lastname@example.org.
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