State Pension Fund Guide Falls to Veto

Gov. George Deukmejian has vetoed legislation that would have guided California’s pension fund investments away from companies with operations that practice religious or ethnic discrimination in Northern Ireland, the governor’s office announced Wednesday.

In his veto message, Deukmejian said he believed that the bill, by Assemblyman John Burton (D-San Francisco), would do more harm than good because it would discourage investment in Northern Ireland.

“While I am sensitive to the sincere desire of many Californians to ease the hardships faced by the Catholic minority in Northern Ireland, I sincerely believe that this legislation has a greater potential to economically penalize, rather than benefit, those it is intended to help,” Deukmejian wrote.

Deukmejian three years ago signed legislation forcing the pension funds to divest their holdings in firms doing business in South Africa. But the Republican chief executive pointed out that in Northern Ireland, unlike South Africa, discrimination is illegal.

“All residents of Northern Ireland are fully enfranchised citizens of the United Kingdom, with elected representation in the British Parliament and the same voting rights as any other British citizen,” Deukmejian wrote.

Burton, in an interview, denounced Deukmejian for “buying right into the propaganda of the British government,” which opposed the bill.

“I’m afraid that what happened is that the representatives of the British government got his ear before we could make the case,” Burton said.

Burton’s bill passed both houses of the Legislature with bipartisan majorities, 46 to 25 in the Assembly and 25 to 6 in the Senate.

The measure would have required the managers of the Public Employees’ Retirement System and the state Teachers’ Retirement System, which together control portfolios totaling more than $80 billion, to investigate the extent to which companies the funds invested in complied with the so-called MacBride Principles.

The principles, named for Amnesty International co-founder Sean MacBride, call for affirmative action to bring under-represented religious minorities into the workplace and train them for advancement. The principles also advocate the abolishment of practices that reserve job openings for applicants from certain religious groups.

“This was not divestment,” said Burton, who is of Irish Catholic descent. “This merely put California on the side of religious equality in the north of Ireland.”

Deukmejian’s action on Burton’s bill was one of scores of signings and vetoes announced by the governor’s office Wednesday, even as Deukmejian was in Virginia attending President Bush’s conference on education. A spokesman said Deukmejian took the actions late Tuesday night before leaving for Virginia.

The governor’s office also announced actions Wednesday on these bills:

Pap smears--Signed legislation by Assemblywoman Sally Tanner (D-Baldwin Park) to impose tighter state regulations on laboratories that examine Pap smears for cervical cancer.

Insurance--Signed a bill by Assemblyman Tom Bane (D-Tarzana) to repeal a provision in state law that some insurance industry attorneys argued would authorize twice the current level of industry profits on auto insurance.

Lemons--Signed a measure by Sen. Herschel Rosenthal (D-Los Angeles) to require auto dealers to inform prospective purchasers if the vehicle they want to buy was returned under the state “lemon law” because of a defect or the dealer’s inability to conform to warranty terms.

Financing--Vetoed a bill by Sen. Alan Robbins (D-Tarzana) that would have permitted automobile buyers to finance their purchases using a variable interest rate. Deukmejian said he believed that such loans would not be in the best interests of consumers because they transfer the risk of higher rates from the lender to the buyer.

Theft--Signed a bill by Assemblyman Pat Nolan (R-Glendale) to increase maximum penalties for auto theft from the current three years in prison to four years. The bill also includes vehicle theft among the crimes that can constitute criminal gang activity under the provisions of the Street Terrorism Enforcement and Protection Act.

Hazardous waste--Signed a bill by Assemblyman Richard Katz (D-Sylmar) to allow seizure of trucks used to transport and dump hazardous waste at unauthorized locations.

Times staff writer Jerry Gillam contributed to this article.

SNITCH LAW: A bill regulating jail informants has been signed. Page 31