RESPOND Act of 2020

I 116TH CONGRESS 2D SESSION H. R. 8760 To require the Board of Governors of the Federal Reserve System and the Securities and Exchange Commission to issue an annual report to the Congress projecting and accounting for the economic costs directly and indirectly caused by the impacts of climate change, and to require the Federal Retirement Thrift Investment Board to establish a Federal Advisory Panel on the Economics of Climate Change, and for other purposes. IN THE HOUSE OF REPRESENTATIVES NOVEMBER 17, 2020 Mr. CLEAVER (for himself and Ms. TLAIB) introduced the following bill; which was referred to the Committee on Oversight and Reform, and in addition to the Committee on Financial Services, for a period to be subsequently determined by the Speaker, in each case for consideration of such provi- sions as fall within the jurisdiction of the committee concerned A BILL To require the Board of Governors of the Federal Reserve System and the Securities and Exchange Commission to issue an annual report to the Congress projecting and accounting for the economic costs directly and indi- rectly caused by the impacts of climate change, and to require the Federal Retirement Thrift Investment Board to establish a Federal Advisory Panel on the Economics of Climate Change, and for other purposes. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 VerDate Sep 11 2014 04:47 Nov 28, 2020 Jkt 019200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H8760.IH H8760 kjohnson on DSK79L0C42PROD with BILLS 2 •HR 8760 IH SECTION 1. SHORT TITLE. 1 This Act may be cited as the ‘‘Restructuring Environ- 2 mentally Sound Pensions in Order to Negate Disaster Act 3 of 2020’’ or the ‘‘RESPOND Act of 2020’’. 4 SEC. 2. CLIMATE CHANGE ECONOMIC COST REPORT. 5 The Board of Governors of the Federal Reserve Sys- 6 tem and the Securities and Exchange Commission shall, 7 jointly, issue an annual report to the Congress projecting 8 and accounting for the economic costs directly and indi- 9 rectly caused by the impacts of climate change, including 10 the labor market, economic growth, property and land 11 damage from rising sea levels and extreme weather, nat- 12 ural disaster relief and mitigation, public health, and other 13 broad areas of the economy. 14 SEC. 3. FEDERAL ADVISORY PANEL ON THE ECONOMICS OF 15 CLIMATE CHANGE. 16 Section 8438 of title 5, United States Code, is 17 amended by adding at the end the following: 18 ‘‘(i) FEDERAL ADVISORY PANEL ON THE ECONOMICS 19 OF CLIMATE CHANGE.— 20 ‘‘(1) ESTABLISHMENT.—The Board shall estab- 21 lish a panel to be known as the ‘Federal Advisory 22 Panel on the Economics of Climate Change’ (the 23 ‘Advisory Panel’). 24 ‘‘(2) MEMBERSHIP.— 25 VerDate Sep 11 2014 04:47 Nov 28, 2020 Jkt 019200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H8760.IH H8760 kjohnson on DSK79L0C42PROD with BILLS 3 •HR 8760 IH ‘‘(A) IN GENERAL.—The Advisory Panel 1 shall consist of 9 members, appointed by the 2 Board as follows: 3 ‘‘(i) Three members shall be chosen 4 from among persons generally recognized 5 for their impartiality, knowledge, and expe- 6 rience in the field of labor relations and 7 pay policy. 8 ‘‘(ii) Six members shall be chosen 9 from among persons with expertise in 10 local, national, or transnational financing 11 that seeks to support mitigation and adap- 12 tation actions to combat climate change. 13 ‘‘(B) LIMITATION.—Not more than 3 14 members of the Advisory Panel may represent 15 a single employee organization, council, federa- 16 tion, alliance, association, or affiliation of em- 17 ployee organizations. 18 ‘‘(C) CHAIR.—The Board shall appoint one 19 member of the Advisory Panel appointed pursu- 20 ant to subparagraph (A)(i) to serve as the 21 Chair of the Advisory Panel. 22 ‘‘(D) COMPENSATION.— 23 ‘‘(i) IN GENERAL.—Members of the 24 Advisory Council may not receive pay by 25 VerDate Sep 11 2014 04:47 Nov 28, 2020 Jkt 019200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H8760.IH H8760 kjohnson on DSK79L0C42PROD with BILLS 4 •HR 8760 IH reason of their service on the Advisory 1 Council, nor shall members who are not 2 otherwise employees of the United States 3 be considered employees by reason of any 4 such service. 5 ‘‘(ii) EXPENSES.—Notwithstanding 6 clause (i) members of the Advisory Panel 7 appointed pursuant to subparagraph (A)(i) 8 may be paid expenses in accordance with 9 section 5703. 10 ‘‘(3) DUTIES.—The Advisory Panel shall— 11 ‘‘(A) advise the Board on how, consistent 12 with their fiduciary duties, the Board can fur- 13 ther decarbonize their portfolio; 14 ‘‘(B) identify possible investment opportu- 15 nities in clean and renewable energy and other 16 emerging industries that would maximize re- 17 turns; 18 ‘‘(C) produce a comparative analysis com- 19 paring the fiduciary efficacy and responsibility 20 of existing investment practices of the Board 21 with decarbonized portfolio alternatives; and 22 ‘‘(D) advise the Board on how to identify, 23 assess, and manage the investment risks and 24 VerDate Sep 11 2014 04:47 Nov 28, 2020 Jkt 019200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H8760.IH H8760 kjohnson on DSK79L0C42PROD with BILLS 5 •HR 8760 IH opportunities of climate change and prepare for 1 a transition to a low-carbon economy. 2 ‘‘(4) EXAMINATION.—In carrying out the duties 3 described under paragraph (3), the Advisory Panel 4 shall examine the following, and issue a report to the 5 Board on the results of such examination: 6 ‘‘(A) Economic and policy challenges fac- 7 ing the fossil fuel industry over the short, me- 8 dium, and long term. 9 ‘‘(B) Quantitative and qualitative analysis 10 and modeling of the economic impact of climate 11 change on Federal employee retirement pro- 12 grams (e.g., diversification of investments, risk 13 tolerance, future economic and workforce 14 trends, new opportunities, expected losses, and 15 returns). 16 ‘‘(C) The current state of, and outlook for, 17 clean energy, including possible investment op- 18 portunities. 19 ‘‘(D) Experience (including performance 20 analysis) of other pension funds and investors 21 which have undertaken concerted de-carbon- 22 ization efforts or strategic divestment from fos- 23 sil fuel holdings in order to maximize the effi- 24 VerDate Sep 11 2014 04:47 Nov 28, 2020 Jkt 019200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H8760.IH H8760 kjohnson on DSK79L0C42PROD with BILLS 6 •HR 8760 IH cacy and stability of their assets while mini- 1 mizing their climate-related risk exposure. 2 ‘‘(E) Strategic options to address climate- 3 related investment risks through further de-car- 4 bonization, including— 5 ‘‘(i) transitioning to a low-carbon or 6 carbon-free benchmark index for all public 7 equities; 8 ‘‘(ii) divesting from significant fossil 9 fuel holdings that are not responsible fidu- 10 ciary investments for beneficiaries; and 11 ‘‘(iii) exploring the use of organiza- 12 tions to de-risk investments in carbon de- 13 pendent funds. 14 ‘‘(5) CONSULTATION WITH FEMA.—The Advi- 15 sory Panel shall, in preparing the report described 16 under paragraph (4), consult with the Federal 17 Emergency Management Agency on any matters 18 within the Agency’s jurisdiction. 19 ‘‘(6) RESULTS OF EXAMINATION.—If the 20 Board, after examining the report issued by the Ad- 21 visory Panel under paragraph (4), determines that 22 pension yields would be both financially profitable 23 and still consistent with the Board’s fiduciary duties 24 if low-carbon investment strategies were imple- 25 VerDate Sep 11 2014 04:47 Nov 28, 2020 Jkt 019200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H8760.IH H8760 kjohnson on DSK79L0C42PROD with BILLS 7 •HR 8760 IH mented, the Board shall set a plan in place to tran- 1 sition the Board’s investment practices accord- 2 ingly.’’. 3 Æ VerDate Sep 11 2014 04:47 Nov 28, 2020 Jkt 019200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6301 E:\BILLS\H8760.IH H8760 kjohnson on DSK79L0C42PROD with BILLS