Carbonated Discussion On TNT This Week
Carbon. We love it in our fizzy drinks and for freezing Han Solo, and as carbon-based units we appreciate this element’s key role in our existence. Carbon is deeply intertwined with our economy and insidiously, is also mucking up the atmosphere and causing global warming.
While politicians hem and haw, the technocrats of the world are doing what they can to withdraw economic support for carbon-based industries, reduce carbon use and even remove it from the atmosphere.
Join host Kevin Hoover on KHSU 90.5 FM’s Thursday Night Talk this Thursday at 7 p.m. to talk about Arcata and HSU’s carbon-cutting efforts.
Guests include Duncan Robins, boardmember of the HSU Advancement Foundation; Annette Penny, president of the Natural resources Club; Eric Recchia, student activist; Mark Andre, Arcata Environmental Services director; and Paul Hagen, attorney and organizer of this Friday’s “Climate Change on the North Coast; Global Events, California’s Vision, North Coast Choices” conference.
Call in your questions about carbon and local efforts to abate it at (707) 826-4805.
Humboldt State, City of Arcata On Carbon-Reduction Quests
Kevin L. Hoover
Mad River Union
ARCATA – Forged in the heart of long-ago exploded stars, the element carbon is a basic component of life on Earth. As part of greenhouse gasses such as carbon dioxide and methane, it’s also a major contributor to global warming.
Now that minimizing carbon’s release into the atmosphere has been identified as an urgent priority, it has become painfully evident how deeply enmeshed the problematic element has become with the global economy.
The central role of carbon in industry and finance has become glaringly apparent to the Humboldt State University Advanc ment Foundation, which manages about $29 million in assets, including donations from supporters of the university.
The influential foundation is embarking on an ambitious effort to reduce and, where possible, eliminate its investments in what it calls “concerning sectors,” that is, the parts of the economy that profit from environmental exploitation and degradation.
These include the obvious, such as oil, gas and coal extraction industries, but also utility companies that generate power from carbon-based fuels.
The foundation curtailed direct investment in fossil fuels 10 years ago, but in part at the urging of student activists, it is now embarking on what it calls “bold, responsible” action.
Last Friday, at a meeting of the Advancement Foundation’s Board of Directors in Humboldt State’s Banquet Room, boardmembers wrestled with the issues and ultimately embraced the recommendations of its Finance Committee, which had devised an implementation plan to proceed with disinvestment in the concerning sectors.
The goal is to extricate the foundation, its assets and Humboldt State from even indirect involvement with profit-making endeavors that run counter to the university’s environmental principles. It aims to eventually disengage from defense, alcohol, tobacco and gaming-related industries.
But in doing so, the foundation is walking the bleeding edge between two forms of responsibility – environmental and fiduciary.
The foundation is obliged to maximize the return on its investments, presently a mix of instruments, including securities, Treasury notes, mutual and money market funds and real estate, some of which is invested in environmentally questionable businesses.
The mandate for maximum financial return is somewhat at odds with the foundation’s newly-intensified environmental ideals. Green investments aren’t necessarily the most lucrative, and the sheer complexity of extricating the foundation’s assets from deeply entrenched and widely held pollutive industries complicates any effort to migrate away from them.
“It’s somebody else’s money that we’re stewarding on their behalf – their estate or what have you – for the benefit of the people that they have looked at,” said Advancement Boardmember Duncan Robins, who developed the Finance Committee’s plan. “It’s not for us to say that we should do something different than what they asked. So not only do we have to balance the maximum return for the minimum risk for the smallest fee related to managing that fund so the net return is the highest so we can put the most money to work for good on behalf of the contributors – we not only have that issue, but we have all of the legal documents that those original contributors put together so that those funds would be stored appropriately and in accord with their wishes.”
The plan is gradual and incremental. It involves the foundation’s adoption of the “Humboldt Principles” – essentially, defining “Socially or Environmentally Concerning Sectors” and working to redirect assets away from them while also identifying “Socially and Environmentally Responsible” (SER) organizations in which to invest.
An Action Plan includes development of a “Social and Environmentally Responsible Offset and Mitigation Policy, or SEROP, that includes the Humboldt Principles, while closely monitoring results and attempting to involve other university foundations.
Craig Wruck, vice president of University Advancement, said the new initiative was in keeping with HSU’s “long tradition of leading social and environmental movements,” with pioneering efforts in socially responsible investing. “We’re feeling that the world may have caught up to us a little bit,” he said.
That may have been a reference to the recent headline-grabbing resolution of San Francisco State’s University Foundation. In March, that organization also voted to wean its finances away from fossil fuels, build a socially responsible portfolio and create a carbon map of the SFSU campus.
Robins said S.F. State may have stolen a PR march on Humboldt, but that it’s really playing catch up.
“San Francisco State is doing great work, but they had direct investments in dirty industries and they are now pulling that investment out. We pulled our direct investments out in dirty industries 10 years ago. So they’re catching up to us of what we did 10 years ago and getting plenty of credit for it,” he said
Near the meeting’s end, a handful of student activists addressed the board, saying the new plan was still too carbonated and urging it to go even further.
Student Andy Recchia offered specific measures to further green up the investment policy, including adding the prison industry to the list of concern sectors, reinvestment in community development and green funds, directing investment managers not to invest in concern sectors and creation of a fossil-free SEROP fund.
That didn’t happen, and after the meeting had gaveled to a close, Recchia offered this caveat to the board: “I’d like it to be noted that I feel like the board did not take any bold, direct action today. That there was action stuff presented to the board, and the board refused to refused to take those four concerns for fear of losing money, and I feel like our university can do better.”
Activist Annette Penny agreed, questioning the substance of the action.
“It kind of went how I expected. They passed a pledge, which is a good step, but it’s not what we asked them to do. They have not moved any money, they did not divest from fossil fuels like we asked them to do. They took a step that is something that makes them feel good about doing something without taking the action that they need to take.”
Robins insisted that the Humboldt approach takes carbon-cutting to a new level.
“This is a bold move,” he said. “There is no other institution doing and outlining what we are doing. It sets up the constructs for everything these students had asked for, and we can take that all on seriously and bring action to all of their concerns.”
Other mitigation measures could include acquisition of new forest lands, which the university could use for carbon sequestration, as the City of Arcata does now. HSU and the city are considering purchase of a 978-acre research forest adjacent to the city’s Jacoby Creek Forest.
Robins said the newly adopted policy well positions Humboldt to vault forward with environmental leadership that 0thers can use as an example.
“What the students are asking for us to do, our community is asking for us to do and what we all want to do is actually move to the next step. What’s out there that people 10 years from now will be trying to catch up to? So we think that this is a very bold, pro-active move, that many institutions will now be able to follow us.”
Arcata’s carbon wars
The City of Arcata is no stranger to the carbon battle. In 2006, it adopted an ambitious Greenhouse Gas (GHG) Reduction Plan which identified the primary sources of carbon emissions and set an ambitious – and unfulfilled – goal of reducing GHG emissions 20 percent by 2010.
The city fell way short of that, achieving only a 12 percent reduction. That was due, in part, to the proliferation of cannabis grow houses – more than 600 of the suburban pot factories ablaze with banks of 1,000 watt halogen lamps.
In response, Arcata’s Energy Committee developed an Excessive Energy Use Tax that imposes a 45 percent tax on homes which use more than three times the energy of an average family home. It was apprioved by voters in 2012.
The new tax both succeeded and failed. It is credited with dramatically reducing grow houses, but because of that, the revenue from the tax has been well below what had been projected. The city paid PG&E $650,000 to implement the tax’s collection. But monthly payments from PG&E – five so far – started at about $50,000 and have declined to the low $40,000s.
The City of Arcata generates about 244,702 tons of carbon dioxide each year, with about 10,000 tons sequestered in its forestlands.
Those wishing to assist with the carbon capture may purchase carbon credits for $13.12 per metric ton by calling Environmental Services at (707) 822-8184 or e-mailing email@example.com.Funds go to Arcata’s Forest Fund, which is used to acquire and maintain the city’s carbon-locking forests.
The city has also joined in the CoolCalifornia City Challenge (see below).
Note: the following is the official Humboldt State press release on the Advancement Foundation's new carbon investment policy:
Humboldt State University Targets Fossil Fuels and More
Adopts 'Humboldt Investment Pledge' for its endowment, challenges other foundations to do more
Humboldt State University’s charitable foundation has adopted an expansive new policy to strictly limit its holdings in a variety of industries, including companies directly or indirectly involved in fossil fuels. And through its “Humboldt Investment Pledge” is urging other foundations to do more to clean up their investments.
The HSU Advancement Foundation’s Board unanimously adopted a new “Social and Environmentally Responsible Offset and Mitigation Policy” and took the Humboldt Investment Pledge at its most recent meeting on April 25.
Humboldt State’s Advancement Foundation has a longstanding practice of making socially responsible, direct investments while closely monitoring the social impact of its indirect investments. For over a decade, the Foundation has operated without any direct investments in fossil fuel-related industries, making it a leader in the more recent fossil fuel divestment movement.
Despite its socially responsible investment record, HSU’s Advancement Foundation Board adopted the stricter policy following extensive meetings with students and other parties who were intent on seeing the Foundation do even better. The policy also builds on the university’s campus-wide commitment to sustainability. Its inclusion of a pledge was inspired by the university’s Graduation Pledge of Social and Environmental Responsibility, which was created by HSU students almost three decades ago and is now used at nearly 100 universities worldwide.
“We could have recommended the status quo, continuing our investment practices that are already more socially responsible than most other institutions. But that isn’t enough for this Board, our students, or our community,” said Duncan Robins, a Board member on the Finance Committee who helped lead the development of the new policy and pledge. “We want to prove that it is possible, even for a relatively small endowment like ours, to do even better,” Robins said. “We won’t be perfect, but we will try to set a positive example for others to follow.”
The policy lays out a ten-point pledge with broad goals that will guide future investment activity. The policy reads:
The Humboldt State University Advancement Foundation will:
- Define Socially or Environmentally Concerning Sectors (“Concerning Sectors”) in a broad, bold way so as to include:
a) Energy - extraction, distribution, refining and marketing (i.e. Oil, natural gas, coal and related/supporting industries);
b) Utilities - electricity generation (i.e. Utilities utilizing carbon-based fuels);
c) Aerospace/Defense, Alcohol, Tobacco, Gaming and Casino industries. Revisit definition and revise as appropriate over time.
- Continue to abstain from any direct investment in Concerning Sectors.
- Monitor and report on the value of indirect investments in Concerning Sectors.
- Make reasonable attempts to reduce the size of indirect investments in Concerning Sectors provided any divestments are consistent with the Foundation's fiduciary requirements.
- Define Socially or environmentally Responsible (“SER”) organizations, projects or assets initially as ones which:
a) Are environmentally friendly (i.e. reduce the levels of atmospheric C02) or;
b) Improve the health and well-being of our community members.
Revisit definition and revise as appropriate over time.
- Actively seek offsetting investment opportunities in SER organizations, projects or assets.
- Invest directly in SER organizations, projects or assets provided that:
a) Investments meet the Foundation’s fiduciary requirements and policies.
b) Investments support the stated HSU mission, vision and values.
- Monitor and report on the value of direct investments in SER assets and active investments in SER organizations or projects.
- Monitor and report on the value of obvious indirect investments in SER organizations, projects or assets.
- Create a SEROP Fund (with appropriate policies) and actively seek donations of funds and assets that could be used to support Humboldt’s SEROP Pledge.
Robins said the student voices and energy on the issue were vital. A student group first approached the Board about divesting from fossil fuels last fall, and since that time has continued to meet with the Board’s Finance Committee to work on details. The Board was inspired by their understanding of the issues and commitment to making a difference.
As discussions with the students and other parties progressed, a policy emerged that focused on much more than a small number of oil companies. It became a policy to discourage investment in all companies either directly or indirectly involved with extracting and using fossil fuel, and one aimed at challenging the Foundation to take more proactive steps going forward. In a stroke, the Foundation is now concerned with the social impact of many more companies in its mutual fund portfolios – nearly 10 percent as opposed to less than 1 percent under a more typical measure of social responsibility.
“The policy provides a great framework to make investment decisions and it’s a huge step forward from what I've seen of previous socially responsible investment policies,” said Eric Recchia ('13, Economics), an HSU alumnus involved in the effort. “This creates both the framework and the internal motivation for the foundation to take further action and start making a difference."
While students did not see immediate action on everything they had wanted—such as dedicating a percentage of the Foundation’s investments to green funds, or including prisons as industry investments to avoid—Board members and Executive Director Craig Wruck said that all those ideas, and many others, could be explored now that the new investment policy was in place.
“We needed the framework of this broader policy first in order to allow us to do the detailed work,” Wruck said. “It was tempting to add specific actions, to set new ambitious timelines, and decide on certain types of investments at the same time. But we need to do this right. We are committed to leading the way on this, but where there are tradeoffs such as possibly reducing the amount of scholarship dollars available, we have to really spend time thinking it through.”
Ultimately, the policy with the Humboldt Investment Pledge was something that Board members said they were proud to adopt, and they did so unanimously. The Board’s Finance Committee will now utilize the framework to make adjustments and changes to its investment strategy, and to make further recommendations to the full Board.
Humboldt State University has a longstanding commitment to environmental and social responsibility. The Princeton Review regularly lists HSU as a top “green college,” and the university’s Graduation Pledge has been adopted by campuses worldwide. HSU houses one of the nation’s oldest eco-demonstration houses, students pay an extra fee for campus energy projects, and classes throughout the curriculum feature topics related to sustainability. The university also recently banned the use of plastic shopping bags and the sale of plastic water bottles on campus. More information is at http://www.humboldt.edu/green.
The following is a press release for a Friday climate change conference organized by attorney Paul Hagen, who will be a guest on KHSU 90.5 FM's Thursday Night Talk May 1 at 7 p.m.:
CLIMATE CHANGE CONFERENCE This year’s “North Coast Your Voice Your Future” public interest law conference is set for Friday, May 2 at the Wharfinger Building in Eureka. The conference is titled “Climate Change on the North Coast; Global Events, California’s Vision, North Coast Choices,” and the public is invited and encouraged to attend. The State Bar of California’s Environmental Law Section is presenting this conference on how environmental issues – and especially climate change – are affecting and will continue to affect California’s North Coast. This year’s North Coast conference again draws speakers from the high levels of Sacramento’s regulatory agencies and academia, as well as local expertise on tribal issues, environmental destruction and sea level rise. Hear insights and perspectives from attorneys, regulators, scientists and others about both the State’s understanding, vision and response to climate change statewide and locally, and how local people and institutions can address future impacts on the North Coast. Further details are available at environmental.calbar.ca.gov/Education/YourVoiceYourFutureNorthCoast.aspx.