HB2156 - 561R

REFERENCE TITLE: proxy voting; governmental entities; prohibition

State of Arizona

House of Representatives

Fifty-sixth Legislature

First Regular Session

2023

HB 2156

Introduced by

Representative Livingston

An Act

amending title 35, chapter 2, Arizona Revised Statutes, by adding article 4; relating to public finances.

(TEXT OF BILL BEGINS ON NEXT PAGE)

Be it enacted by the Legislature of the State of Arizona:

Section 1. Title 35, chapter 2, Arizona Revised Statutes, is amended by adding article 4, to read:

ARTICLE 4. GOVERNMENT INVESTMENTS

START_STATUTE35-351. Plans; voting of ownership interests; definitions

A. Only a governmental entity that establishes or maintains a plan may vote the shares held by the plan. A governmental entity may not hire a THIRD-PARTY vendor or grant proxy voting authority to any person who is not a part of the governmental entity.

B. A fiduciary may not adopt a practice of following the recommendations of a proxy advisory firm or other service.

C. For the purposes of this section:

1. "Fiduciary" means a person who does any of the following:

(a) exercises any discretionary authority or discretionary control with respect to A plan or exercises any authority or control managing or disposing of the plan's assets.

(b) renders investment advice for a fee or other compensation, directly or indirectly, with respect to any monies or other property of A plan or has the authority or responsibility to render investment advice.

2. "Plan" means any plan, fund or program that is established or maintained by this State or a political subdivision of this state, including a university under the jurisdiction of the Arizona board of regents and a community college as defined in section 15-1401, to do any of the following:

(a) Provide retirement income or other retirement benefits to employees or former employees.

(b) defer income by employees for A period of time extending to the termination of covered employment or beyond.