The state of Florida keeps lists of companies it can’t invest state retirement money in. The businesses are called “scrutinized companies” – scrutinized because of where they do business, or, in the case of Israel, have decided not to do business there.
If a company appears on the list then investment managers cannot invest Florida pension money into that company’s stocks or bonds.
More than 50 companies doing business in Iran were on the list of prohibited investments as of late last month. Most of them are based in China.
Florida lawmakers gather in Tallahassee beginning Nov. 6 for what is expected to be a three-and-a-half-day special session. Gov. Ron DeSantis called them back to the capital primarily in response to the Israeli war against Hamas. He has called on legislators to approve more sanctions on Iran.
More accurately, what the proposed legislation aims to do is further limit the state from investing its pension funds in companies doing business with Iran.
READ MORE: Florida Democrats question the state's role in rescuing Israel evacuees
"We have over $200 billion sitting in the state between our pension funds and various trust funds. You know, hundreds of billions of dollars that are being invested and that we are the stewards of," said Rep. John Snyder (R-Martin County), sponsor of the legislation.
The proposed bill expands the existing scrutinized company definition related to Iran to expand industries beyond energy. "We will be taking steps to fully divest and ensure that Floridian taxpayer dollars are in no way supporting the government of Iran," Snyder added.
While DeSantis and supporters have described these state efforts as sanctions against Iran, the focus is on companies doing business there and not directly the Iranian government. The U.S. federal government has had sanctions in place against activities with Iran since the 1979 embassy hostage crisis.
The U.S. House on Friday approved a bill that would impose penalties on foreign ports and oil refineries that accept Iranian oil in violation of American sanctions. The bill was first introduced in May, months before the Hamas terrorist attacks in Israel.
It found bipartisan support in the House, winning passage 342 to 69. It was co-sponsored by Broward County Rep. Jared Moskowitz (D-FL). In a news release, he called the bill "a critical step in preventing Iran from continuing to fund terror across the Middle East."
The only member of Florida’s congressional delegation to vote against the proposal was Rep. Maxwell Frost (D-Orlando).
Florida ups investment in Israeli government bonds
Florida is one of 14 states that have announced plans to invest state funds in Israeli government bonds. The state will buy $145 million worth of the IOUs. That will bring Florida’s total investment in the government debt to $200 million. That’s the largest position the state has ever held in Israeli bonds.
Palm Beach County also announced it will buy $135 million of Israel bonds, bringing the county’s total investment in the bonds to $200 million - about 5% of the county’s investment portfolio.
DeSantis announced his interest in expanding limitations of state investments in companies doing business with Iran just days after the Hamas attacks.
“With Iran helping plot the barbaric attack against Israel, I want to make it abundantly clear: Florida supports the State of Israel against the Iranian terror state," the governor said Oct. 10 while visiting the Shul of Bal Harbour in South Florida.
The U.S. government has not pointed to Iran as having a direct role in the Hamas attack. However, Iran has long provided support for Hamas such as financing, arms and training.
“When it comes to the Iranian government and their proxies waging war and trying to disrupt peace in the region,” Snyder said, “we want to send the signal that here in Florida we take that seriously.”
