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Sonoma County teachers press pension fund to back away from fossil fuels

S&P 500 v S&P Fossil Fuel Free performance

S & P 500 S & P Fossil Fuel Free Index

1-yr performance* +35.91% +37.16%

3-yr performance* +19.78% +20.57%

5-yr performance* +17.55% +18.29%

* as of Nov. 4, 2021

North Coast educators are on the forefront of a bid to persuade the powerful California Teachers Association to pressure the statewide teachers’ pension fund to divest more than $6 billion in fossil fuel holdings.

They’re not alone in their support of a campaign to align the state’s largest teachers union with a growing number of domestic and international institutions that are pulling financial stakes from oil and gas companies as climate change accelerates. Similar efforts are underway around California.

But the Sonoma County Educators Council, which represents 34 local CTA chapters and about 3,200 members, last month became the first countywide leadership group to vote formally in favor of fossil fuel divestment. Ten days later, members of the Redwood Region Service Center Council, which represents teachers from the North Bay up the coast to Oregon, followed suit.

Among those leading the charge is Park Guthrie, a sixth-grade teacher at Salmon Creek School in Occidental who co-founded Schools for Climate Action. He is also a veteran proponent of socially and environmentally thoughtful investment of more than $312 billion managed by the California State Teachers’ Retirement System, or CalSTRS, and has argued in favor of divestment for many years.

Like others in the movement, Guthrie argues that enriching teacher pensions at the cost of environmental harm contradicts teacher values that support healthy students, families and communities — especially when it comes to people of color or those who are economically disadvantaged and most likely to suffer the brunt of climate impacts.

“I feel like I’m answerable to my students,” said longtime environmental activist Sunny Galbraith, a chemistry and independent study teacher at Sebastopol’s Orchard View School who has been working on the campaign with Guthrie. “Like my students are kind of aghast at what’s happening in the world and at the adults in their lives and in government and in higher-up structures, and inaction in the climate disaster.

“It’s just unconscionable to me that in this profession — that we are very much in it for healing children and helping young adults — that our earnings are funding the demise of our children’s future,” Galbraith said.

Proponents say the economics of divestment also make sense — that studies not only show comparable or superior gains through fossil-free investing, but the increasingly rapid move away from what Guthrie calls “a sector in terminal decline” means those left holding oil and gas stocks risk drastic losses in the end.

They cite a 2019 study by Corporate Knights, a Toronto-based media firm, that concluded CalSTRS missed out on $5.5 billion it could have generated over the previous 10 years had it excluded fossil fuel companies from its portfolio.

The rapid retreat from oil and gas interests means those investments are likely to continue losing value, and fast, divestment advocates say, until someone is left holding the bag — an empty one.

The decision last month by Europe’s largest pension fund, the Dutch ABP, which serves government and education employees in the Netherlands, to dump $17.4 billion in fossil-fuel assets by early 2023 brings the value of global institutional divestment pledges to $39.88 trillion, according to 350.org.

“Not only is it the morally right thing to do for the climate and the Earth,” said Tiffany Kampmann, a third-grade teacher at Taylor Mountain Elementary School in south Santa Rosa’s Bellevue Union School District. “But it’s the financially sound thing to do. Oil and gas stocks are falling.

“The sooner we divest, the less of a hit we’ll tall take — CalSTRS, that is. The longer we wait, the more we lose, is what it looks like. I don’t know what people have against it,” Kampmann said.

The challenge is significant, however.

The teachers union represents 310,000 public school and community college teachers of varying interests and political persuasions from around California who have been told for years that they risk too much if they let environmentalism dictate investment strategy. Its active and retired members make up the majority of CalSTRS’ members, along with those from the smaller California Federation of Teachers and certificated school administrators from around the state.

The CTA is also not synonymous with CalSTRS, an independent, century-old agency developed to secure teacher pensions.

Jerry Eaton, a Fairfield high school teacher and former financial adviser who serves as CTA director for the nine-county district that includes Sonoma, Napa, Marin, Mendocino, Lake, Humboldt, Solano, San Francisco and Del Norte counties, said he wasn’t convinced CalSTRS would be swayed by sentiment among the teachers association.

S&P 500 v S&P Fossil Fuel Free performance

S & P 500 S & P Fossil Fuel Free Index

1-yr performance* +35.91% +37.16%

3-yr performance* +19.78% +20.57%

5-yr performance* +17.55% +18.29%

* as of Nov. 4, 2021

CalSTRS is the world’s largest educator-only pension fund and the second largest U.S. public pension fund, with fiduciary obligations on behalf of 975,000 active members, retired members and beneficiaries.

California State Treasurer Fiona Ma and State Superintendent of Public Instruction Tony Thurmond, both ex officio members of the 11-member CalSTRS governing board, have both come out in favor of gas and oil interest divestment over the past two years.

But the fund’s investment committee and its chief investment officer have resisted calls for oil and gas divestment from youth groups, educators and other advocates over several years, pledging instead earlier this fall to achieve a net zero portfolio by 2050 or sooner.

A 2017 state Assembly bill that would have required both CalSTRS and CalPERS, the state’s public employee pension fund, to divest from companies involved in construction of the Dakota Access Oil Pipeline failed to win approval from either the teachers association or CalSTRS and resulted in the pension fund’s reaffirmation of its preference for “engagement” as a means of shaping corporate behavior instead.

While CalSTRS’ investment policies include a contingency for balancing the rate of return on an investment against factors related to environmental degradation, they specifically rule out the possibility of excluding “any investments in companies, industries, countries or geographic areas” absent sustained risk.

“When pressured to divest, CalSTRS firmly believes that active and direct engagement is the best way to resolve issues,” the policy states. “Face to face meetings with shareowners and senior management, or the Board of Directors, are essential to bringing about change in a corporation.”

Guthrie and his allies say part of the issue is long-standing institutional culture and outdated views about climate change, the inevitable profitability of fossil fuel investments and attachment to the idea that engagement may bear fruit, despite the evidence.

They say the CTA misrepresented a CalSTRS analysis to suggest divestment from Dakota Pipeline companies four years ago could have cost the teachers’ pension fund $8 billion, conflating two different issues and misstating the costs of divestment by a factor of 270.

But teachers, said Guthrie, are so busy and “generally financially stressed” that it was enough to turn the CTA against the idea.

“There’s been very strategic control of the narrative,” he said. “It’s almost a form of gaslighting.”

Retired Santa Rosa teacher Jane Vosburg has been lobbying CalSTRS in favor of divestment since 2013 without movement. But she says now the dominoes may be falling.

That’s the hope of Guthrie, who with a Santa Monica sixth-grade teacher named Shelly Ehrke and Mark Norberg, who teaches in Burbank, launched CTA Divest! last summer to urge CTA members around the state to sign a petition and pass resolutions in favor of divestment.

Ever Flores, a counselor at Healdsburg High School, president of the Healdsburg Area Teachers Association and a member of the Santa Rosa School Board, said divestment proponents are working diligently to ensure their message is data driven.

But they can’t ignore the urgent signs of a changing planet, most especially in Sonoma County, with its history of catastrophic, climate-driven wildfires.

“CTA is one of the biggest investors in CalSTRS, and it will mean a lot as an institution to take a stand now, right? And to make sure that we’re seen as people that stood for change and not with the arsonists.”

You can reach Staff Writer Mary Callahan at 707-521-5249 or mary.callahan@pressdemocrat.com. On Twitter @MaryCallahanB.

Editor’s note: This story has been updated to correct the alleged misrepresentation of costs associated with the proposed divestment of CalSTRS holdings in Dakota Access Pipeline companies in 2017.

Mary Callahan

Environment and Climate Change, The Press Democrat

I am in awe of the breathtaking nature here in Sonoma County and am so grateful to live in this spectacular region we call home. I am amazed, too, by the expertise in our community and by the commitment to protecting the land, its waterways, its wildlife and its residents. My goal is to improve understanding of the issues, to find hope and to help all of us navigate the future of our environment. 

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