JEFFERSON CITY — The former state treasurer is teaming with a Republican lawmaker to prod state retirement fund officials to strengthen policies against investing in companies with terrorism ties.
Legislation filed Monday would bar state pension systems from investing in companies that do business with countries such as Iran, Syria and Sudan, which are led by governments the United States considers sponsors of terrorism. The measure comes about a year after Missouri's largest pension fund for state employees rescinded a policy, which stepped up the screening of companies for possible terrorism links.
"We shouldn't be investing taxpayer dollars in companies that do business with these governments," said Sarah Steelman, a Republican who served as state treasurer from 2005-09.
Steelman is married to David Steelman, who was appointed to the pension board by Gov. Jay Nixon last year.
At Sarah Steelman's behest, the Missouri State Employees' Retirement System in 2005 approved a policy requiring terrorism screening on direct investments. The pension fund paid $23,000 a year to a consultant to screen for possible terrorism ties.
But no investments were sold specifically because of support for terrorism. The board dropped the policy in March 2009 because it decided the screening was not cost-effective. It now checks investments against a federal list of companies with terrorist ties.
"The bottom line is the MOSERS board does not support terrorism, and MOSERS has a cost-effective policy and procedure to assure itself that we are not investing in terrorist activities," said Chris Rackers, manager of investment policy and communication for the pension fund.
Steelman told reporters Monday that she recommended the retirement fund drop some investments, but she was overruled.
The legislation sponsored by Rep. Jason Smith would require state-funded employee retirement systems to divest from companies found to be doing business with governments that sponsor terrorism. Smith said about 20 states followed Missouri's lead in 2005 and have approved laws or policies barring investments in companies with terrorism links.
The bill is designed to also restrict the investments of other state pension systems, such as those for the Missouri State Highway Patrol and Department of Transportation.
Smith, R-Salem, said last year's decision by the Missouri State Employees' Retirement System to drop the increased screening showed the need for a law.
"If Missourians or Americans knew that state resources were being invested into a company that has a lot of business ties in Iran that would be very frustrating," he said.