Council Urges Pension Board to Drop S. Africa Investments
The San Diego City Council strongly urged the city employees’ Retirement Board on Monday to “follow policy” and sell all of its $35.5 million in investments with six firms doing business in South Africa.
Under San Diego’s charter, the City Council may establish guidelines for the $378-million retirement portfolio, but cannot order specific investment decisions.
But Councilmen Uvaldo Martinez and William Jones and Mayor Roger Hedgecock had harsh words for retirement board members who are thinking of going against the council’s recommendation.
“Those who have problems with carrying out our policy . . . if they’re not comfortable, then they should resign,” Martinez said.
Retirement Board Administrator Robert Logan said he was not surprised at the council’s 5-2 vote. Councilmen Bill Cleator and Dick Murphy voted no; Gloria McColl and Ed Struiksma were absent.
But Logan said he doubts that the council could remove any board members who do not comply with Monday’s vote.
Board members “are appointed for specific terms,” Logan said. “As far as we know, unless someone wants to voluntarily resign, you’ve got to have grounds if you want to force somebody off.”
Last month, the San Diego city manager’s and city attorney’s offices argued that investment decisions should be made without council interference.
Hedgecock said Monday that, by “recommending” and not ordering divestment, the City Council is letting the Retirement Board do the work.
The council vote represented a major victory for Marian Howell, a city typist who initiated the drive to divest in January when she noticed that the employees’ retirement portfolio included companies that do business in South Africa. She persuaded 235 city employees to sign petitions calling for divestment. The petitions were presented to the council on Monday.
Members of TransAfrica and San Diegans for Divestment filled the council chambers, holding signs that said, “U.S. Out of South Africa” and “No City Money for Racism.”
Speakers for and against divestment were given 20 minutes to make their pitches before the council.
All of the speakers in favor were city employees whose retirement benefits are at stake; none of the speakers against worked for the city.
After the vote, Howell fought back tears outside the council chambers as she was hugged by fellow employees.
“We did it! We did it!” Howell said as she jumped up and down. “How could they say no? So many people showed up. Two months ago, I didn’t think this could happen. It’s beautiful.”
Cleator said that, although he deplores the treatment of blacks in South Africa, he voted against divesting because any chance to improve the situation disappears along with economic incentives.
“The individuals who were pushing for divestment are absolutely on the wrong track,” Cleator said. “What they’re going to accomplish is just the opposite. I think it is easy for someone who is sitting here in beautiful San Diego with a nice job . . . to tell others how to effect change.”
Divestment would affect 8.8% of the Retirement Board’s holdings. The six firms involved are Avery International, Dun & Bradstreet, IBM, 3M, Phillips Petroleum and Times Mirror, owner of the Los Angeles Times, which maintains a news bureau in Johannesburg.
Over the last two years, 20 U.S. states and cities have sold $200 million in shares of companies that had business ties in South Africa.
The City Council is responsible for appointing four of the 13 members who serve on the board. All four of those appointees sit on the five-member committee that makes decisions concerning investments.