CHARLESTON – Five major financial institutions are now ineligible for state banking contracts because of their environmental policies, and are on West Virginia’s first list of restricted financial institutions.
West Virginia State Treasurer Riley Moore announced Thursday that BlackRock Inc., Goldman Sachs Group Inc., JPMorgan Chase & Co., Morgan Stanley and Wells Fargo & Co. they are involved in boycotts of fossil fuel companies, according to a new state law and are no longer eligible to enter into state banking contracts with their office.
A sixth company, US Bancorp, was initially identified as potentially involved in boycotts of energy companies, but Moore said it was left off the list after demonstrating to the treasurer’s office that it has eliminated anti-funding policies from coal mining, coal power and pipeline construction activities. of its Social and Environmental Risks Policy.
“As treasurer, I have a duty to act in the best interest of the state treasury and our people when choosing financial services for West Virginia.” Moore said. “Any institution with policies aimed at weakening our energy industries, tax base and job market has a clear conflict of interest in managing taxpayer dollars.”
State lawmakers earlier this year passed a bill authorizing the state treasurer to post a restricted list of financial institutions on the office’s website and disqualify any financial institution from the list of state bank contracts.
In preparing the list, the treasurer’s office reviewed publicly available environmental and social policy statements published by financial institutions that are currently authorized to do business with their office as approved state depositories or sweep account providers for short-term funds of the state.
The six originally flagged financial institutions were given written notice and given 30 days to submit additional information challenging their possible inclusion on the list of restricted financial institutions. All six submitted responses, which the treasurer reviewed along with each institution’s public policy statements.
“Each financial institution on the Restricted Financial Institutions List … has published written environmental or social policies that categorically limit business relationships with energy companies engaged in certain coal mining, extraction, or utilization activities, rather than to consider the financial or risk profile of each company”. Moore said. “These policies explicitly limit commercial engagement with an entire energy sector based on subjective environmental and social policies.”
West Virginia annually collects hundreds of millions of dollars in taxes on coal and other fossil fuels, which typically represent the third largest source of revenue for the state’s general revenue budget.
In the most recent fiscal year, the nearly $769 million in severance taxes paid by coal, oil and natural gas companies accounted for 13 percent of the $5.89 billion in general revenue funds collected by the state . This does not include income taxes and other taxes also collected from the employment and economic activity generated by these fossil fuel industries.
According to the treasurer’s office, a recent report from West Virginia University’s College of Business and Economics found that in 2019, coal mining and coal power generated $13.9 billion in total economic activity and supported nearly 33,000 jobs in West Virginia.
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