Nevada Treasurer Zach Conine discusses details of a new Pandemic Emergency Technical Support small-business grant at the Latin Chamber of Commerce, downtown, Wednesday, Oct. 14, 2020.
Friday, June 3, 2022 | 2 a.m.
Nevada will divest nearly $90 million in its investment portfolio from companies that manufacture or sell assault-style weapons, citing moral and financial obligations to act following a mass shooting at an elementary school in Texas last week that killed 21 people — 19 of whom were children.
The Nevada treasurer’s office manages an investment portfolio of more than $49 billion, of which $89 million is held in assets relating to the assault weapons industry, Treasurer Zach Conine said on Thursday in a video message announcing the move.
“As Nevada’s chief investment officer, I have a responsibility to ensure Nevada’s tax dollars are invested with minimal exposure to risk. Companies that profit on the manufacture and sale of assault-style weapons present a market risk I’m not willing to take,” Treasurer Zach Conine said. “Investments are fundamentally a plan for the future, and it’s time Nevada started investing in a better future where our children aren’t slaughtered in classrooms.”
The office will divest the assets in “the most fiscally prudent manner possible,” and divestments will not be sold at a loss to ensure the state’s portfolio won’t be negatively affected, according to a news release issued by Conine’s office.
“If an asset cannot be sold profitably, we will hold it until maturity, and then never buy it again,” Conine said in the video. “We will do the right thing. And we will do it in the right way.”
The state will also direct external financial managers and outside investment partners to take similar action, the news release said.
“The risk adjusted return of these businesses does not exceed investments of their peers,” Conine said. “And in my opinion, they expose the state to too much risk. As a chief investment officer of Nevada, managing risk to Nevada’s taxpayers is my responsibility.
“Second, the risk for investing in these companies is too high and is more than we are willing to bear,” he said.
Nevada’s largest portfolio holding — the Nevada College Savings Plan — is worth approximately $38.8 billion, followed by the state’s general portfolio ($7.2 billion), the Local Government Investment Pool ($2.4 billion), the Permanent School Fund ($527.45 million) and the Nevada Higher Education Prepaid Tuition Trust ($405.15 million), according to the Conine’s office.
What assault-style arms dealers or manufacturers the state is invested in is unclear. Erik Jimenez, chief policy deputy for the treasurer’s office, said in a statement to the Sun that the $89 million identified for potential divestment is made up of “larger index funds with some exposure to the divested industries.”
A wider review of all the state’s holdings is underway, Jimenez said.
The move to divest is not effective immediately but will instead be presented for adoption at upcoming meetings of the State Board of Finance and the Board of Trustees of the College Savings Plans of Nevada — June 14 and June 23, respectively — the treasurer’s office said.
Conine’s announcement was met with swift opposition by Republicans Michele Fiore and Manny Kess, who are vying for their party’s nomination to unseat Conine, a Democrat, in November’s general election.
Kess, a businessman, told the Sun the move was “deplorable” and criticized Conine for using a tragedy to push a divisive agenda.
“I’m just tired of seeing politicians push political policies and not who what’s right for the people,” Kess said. “This does not help anyone. All it does is push a policy of Democrats hate guns (and) Republicans love guns. That shouldn’t be the case. It should be doing what’s best for your constituents.
“The state should invest in any sound business decision. It shouldn’t be emotionally influenced. If it’s a smart, safe business decision that will yield a profit, then we should invest in it.”
Fiore, the Las Vegas city councilwoman, told the Sun the move was a nod to “far-left political ideology.”
“This is what happens when you elect a woke political operative to oversee the state’s finances,” she said. “As state treasurer, I will make decisions based on the best financial returns, not a far-left political ideology.”
If approved, Nevada will join Connecticut, Rhode Island and New York City as municipalities that have divested from firearms companies. Connecticut was the first state to do so, announcing a similar move in 2019.
“We have a moral obligation not just to offer thoughts and prayers, but to act. And we have a financial obligation to rid ourselves of investments that carry this much risk,” Conine said.
