Senator M. TERESA RUIZ
District 29 (Essex)
Senator NILSA CRUZ-PEREZ
District 5 (Camden and Gloucester)
Assemblywoman ANNETTE QUIJANO
District 20 (Union)
Assemblywoman ANNETTE CHAPARRO
District 33 (Hudson)
Assemblyman Chiaravalloti and Assemblywoman Lopez
Prohibits investment of State pension and annuity funds in entities engaged in mortgage foreclosures during periods of mortgage foreclosure moratoria in Presidentially-Declared Major Disaster Areas impacted by Hurricane Maria.
CURRENT VERSION OF TEXT
An Act prohibiting the investment of State pension and annuity funds in entities engaged in mortgage foreclosures during certain periods involving a mortgage foreclosure moratorium in Presidentially-Declared Major Disaster Areas impacted by Hurricane Maria, supplementing P.L.1950, c.270 (C.52:18A-79 et seq.).
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. a. Notwithstanding any provision of law to the contrary, no assets of any pension or annuity fund under the jurisdiction of the Division of Investment in the Department of the Treasury, or its successor, shall be invested in a debt or equity instrument of an entity engaged directly or indirectly in mortgage foreclosures of property during periods of a federally announced mortgage foreclosure moratorium in a Presidentially-Declared Major Disaster Area impacted by Hurricane Maria which moratorium initially applied to the initiation of foreclosures and foreclosures already in process, and during an extension of a mortgage foreclosure moratorium or a period of a lapse in a foreclosure moratorium or during lapses in extensions of those moratoria.
b. The State Investment Council and the Director of the Division of Investment shall take appropriate action to divest any investment held in violation of subsection a. of this section. This section shall not be construed to require the premature or otherwise imprudent divestment of an investment, but such divestment shall be completed not later than one year following the effective date of P.L. , c. (C. ) (pending before the Legislature as this bill).
c. Within 60 days after the effective date of P.L. , c. (C. ) (pending before the Legislature as this bill), the Director of the Division of Investment shall file with the Legislature, pursuant to section 2 of P.L.1991, c.164 (C.52:14-19.1), a report of all investments held as of the effective date that are in violation of subsection a. of this section. Every month thereafter, the director shall report on all investments divested in compliance with this section until the divestment is completed.
Each report after the initial report shall provide a description of the progress that the division has made since the previous report and since the enactment of P.L. , c. (C. ) (pending before the Legislature as this bill) in implementing subsection b. of this section.
d. State Investment Council members, jointly and individually, and State officers and employees involved therewith, shall be indemnified and held harmless by the State of New Jersey from all claims, demands, suits, actions, damages, judgments, costs, charges, and expenses, including court costs and attorney’s fees, and against all liability, losses, and damages that these State Investment Council members, and State officers and employees, may sustain by reason of any decision to restrict, reduce, or eliminate investments pursuant to this act.
2. This act shall take effect immediately.
This bill prohibits the State of New Jersey from investing any assets of any pension or annuity fund under the management of the Division of Investment in the Department of the Treasury in any entity directly or indirectly engaged in mortgage foreclosures of property during periods of a federally announced mortgage foreclosure moratorium in a Presidentially-Declared Major Disaster Area impacted by Hurricane Maria. The bill also applies the investment prohibition to entities involved in mortgage foreclosures during extensions of those moratoria and during periods of lapses in extensions of a moratorium. The bill principally is intended to withdraw from State investments in private equity funds that have holdings in mortgage companies that aggressively pursue home mortgage foreclosures on the island of Puerto Rico which was left devastated by Hurricane Maria.
The bill also includes two reporting requirements:
(i) an initial report detailing the current investments held in violation of the bill that is due within 60 days of the date of enactment; and
(ii) a monthly report detailing the progress made in disposing of those investments.
Recently, at a public meeting of the New Jersey State Investment Council information was presented that two private equity funds that the State pension systems has significant stakes in have financial ties to businesses that are pursuing foreclosures on the devastated island. However, no direct public action has been taken to question these businesses about their eviction actions against the homeowners still suffering under extremely challenging circumstances in the wake of the destruction of homes and infrastructure caused by Hurricane Maria. This bill will ensure that the State makes no financial gain from investments in companies that continue to pursue home foreclosures that ignore the suffering as well as the dire financial circumstances facing the residents of the island of Puerto Rico.