II 

117TH CONGRESS 

1ST SESSION S. 606 

To require the Board of Governors of the Federal Reserve System and 

the Securities and Exchange Commission to issue an annual report 

to Congress projecting and accounting for the economic costs directly 

and indirectly caused by the impacts of climate change, 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 SENATE OF THE UNITED STATES 

MARCH 4, 2021 

Mr. MERKLEY introduced the following bill; which was read twice and referred 

to the Committee on Homeland Security and Governmental Affairs 

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 Congress projecting and 

accounting for the economic costs directly and indirectly 

caused by the impacts of climate change, to require 

the Federal Retirement Thrift Investment Board to establish a Federal Advisory Panel on the Economics of 

Climate Change, and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 


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1 SECTION 1. SHORT TITLE. 

2 This Act may be cited as the ‘‘Restructuring Environ3 mentally Sound Pensions in Order to Negate Disaster Act 

4 of 2021’’ or the ‘‘RESPOND Act of 2021’’. 

5 SEC. 2. CLIMATE CHANGE ECONOMIC COST REPORT. 

6 Not later than 1 year after the date of enactment 

7 of this Act, and annually thereafter, the Board of Gov8 ernors of the Federal Reserve System and the Securities 

9 and Exchange Commission shall jointly submit to Con10 gress a report that projects and accounts for the economic 

11 costs directly and indirectly caused by the impacts of cli12 mate change, which shall include an analysis of— 

13 (1) the effects that climate change has on the 

14 labor market, economic growth, public health, and 

15 other broad areas of the economy of the United 

16 States; 

17 (2) property and land damage from rising sea 

18 levels and extreme weather; and 

19 (3) the costs associated with natural disaster 

20 relief and mitigation. 

21 SEC. 3. FEDERAL ADVISORY PANEL ON THE ECONOMICS OF 

22 CLIMATE CHANGE. 

23 (a) ESTABLISHMENT.—The Federal Retirement 

24 Thrift Investment Board (referred to in this section as the 

25 ‘‘Board’’) shall establish a panel to be known as the ‘‘FedVerDate Sep 11 2014 18:41 Apr 03, 2021 Jkt 019200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\S606.IS S606

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1 eral Advisory Panel on the Economics of Climate Change’’ 

2 (referred to in this section as the ‘‘Advisory Panel’’). 

3 (b) MEMBERSHIP.— 

4 (1) IN GENERAL.—The Advisory Panel shall 

5 consist of 9 members, appointed by the Board as fol6 lows: 

7 (A) Three members shall be chosen from 

8 among persons generally recognized for their 

9 impartiality, knowledge, and experience in the 

10 field of labor relations and pay policy. 

11 (B) Six members shall be chosen from 

12 among persons with expertise in local, national, 

13 or transnational financing that seeks to support 

14 mitigation and adaptation actions to combat cli15 mate change. 

16 (2) LIMITATION.—Not more than 3 members of 

17 the Advisory Panel may represent a single employee 

18 organization, council, federation, alliance, associa19 tion, or affiliation of employee organizations. 

20 (3) CHAIR.—The Board shall select a member 

21 of the Advisory Panel appointed under paragraph 

22 (1)(A) to serve as the Chair of the Advisory Panel. 

23 (4) COMPENSATION.— 

24 (A) IN GENERAL.—A member of the Advi25 sory Panel— 


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1 (i) may not receive pay by reason of 

2 the service of the member on the Advisory 

3 Panel; and 

4 (ii) shall not be considered to be an 

5 employee of the Federal Government solely 

6 because of the service of the member on 

7 the Advisory Panel. 

8 (B) EXPENSES.—Notwithstanding sub9 paragraph (A), a member of the Advisory Panel 

10 appointed under paragraph (1)(A) may be paid 

11 expenses in accordance with section 5703 of 

12 title 5, United States Code. 

13 (c) DUTIES.—The Advisory Panel shall— 

14 (1) advise the Board on how, consistent with 

15 the fiduciary duties of the Board, the Board can 

16 make investments in a manner that helps ensure 

17 that the United States achieves net zero greenhouse 

18 gas emissions not later than 2050; 

19 (2) identify possible investment opportunities in 

20 clean and renewable energy and other emerging in21 dustries that would maximize returns; 

22 (3) produce a comparative analysis comparing 

23 the fiduciary efficacy and responsibility of existing 

24 investment practices of the Board with the invest25 ment strategies described in paragraph (1); and 


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1 (4) advise the Board on how to identify, assess, 

2 and manage the investment risks and opportunities 

3 of climate change and prepare for a transition to a 

4 low-carbon economy. 

5 (d) EXAMINATION.— 

6 (1) IN GENERAL.—In carrying out the duties of 

7 the Advisory Panel under subsection (c), the Advi8 sory Panel shall examine the following: 

9 (A) Economic and policy challenges facing 

10 the fossil fuel industry over the short, medium, 

11 and long term. 

12 (B) Quantitative and qualitative analysis 

13 and modeling of the economic impact of climate 

14 change on Federal employee retirement pro15 grams, including diversification of investments, 

16 risk tolerance, future economic and workforce 

17 trends, new opportunities, expected losses, and 

18 returns. 

19 (C) The current state of, and outlook for, 

20 clean energy, including possible investment op21 portunities. 

22 (D) The experiences, including perform23 ance analyses, of other pension funds and inves24 tors that have undertaken concerted strategic 

25 efforts to divest from fossil fuel holdings in 


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1 order to maximize the efficacy and stability of 

2 their assets while minimizing their climate-re3 lated risk exposure. 

4 (E) Strategic options to address climate5 related investment risks through further efforts 

6 to divest from fossil fuel holdings, including— 

7 (i) transitioning to a low-carbon or 

8 carbon-free benchmark index for all public 

9 equities; 

10 (ii) divesting from significant fossil 

11 fuel holdings that are not responsible fidu12 ciary investments for beneficiaries; and 

13 (iii) exploring the use of organizations 

14 to de-risk investments in carbon dependent 

15 funds. 

16 (2) REPORT.—Not later than 2 years after the 

17 date of enactment of this Act, the Advisory Panel 

18 shall submit to the Board a report containing the 

19 findings of the Advisory Panel, including the results 

20 of the examinations performed under paragraph (1). 

21 (e) CONSULTATION WITH FEMA.—The Advisory 

22 Panel shall, in preparing the report required under sub23 section (d)(2), consult with the Administrator of the Fed24 eral Emergency Management Agency on any matters with25 in the jurisdiction of that Agency. 


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1 (f) REVIEW OF REPORT.— 

2 (1) IN GENERAL.—If the Board, after reviewing 

3 the report submitted by the Advisory Panel under 

4 subsection (d)(2), determines that it would be finan5 cially profitable, and consistent with the fiduciary 

6 duties of the Board, to implement low-carbon invest7 ment strategies, the Board shall establish a plan to 

8 transition the investment practices of the Board ac9 cordingly. 

10 (2) REPORT TO CONGRESS.—The Board shall 

11 submit to Congress, including to the Office of the 

12 Law Revision Counsel of the House of Representa13 tives, a report regarding the determination of the 

14 Board under paragraph (1), including if the Board 

15 is unable to determine that it would be financially 

16 profitable, and consistent with the fiduciary duties of 

17 the Board, to implement low-carbon investment 

18 strategies. 

19 (g) TERMINATION.—Notwithstanding section 14 of 

20 the Federal Advisory Committee Act (5 U.S.C. App.), the 

21 Advisory Panel shall terminate upon submitting the report 

22 required under subsection (d)(2). 

23 (h) AUTHORIZATION OF APPROPRIATIONS.—There 

24 are authorized to be appropriated not more than 

25 $2,000,000 for the Advisory Panel to comply with the reVerDate Sep 11 2014 18:41 Apr 03, 2021 Jkt 019200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\S606.IS S606

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1 quirements of the Federal Advisory Committee Act (5 

2 U.S.C. App.), including by ensuring that the Advisory 

3 Panel will have— 

4 (1) adequate staff and quarters; and 

5 (2) funds available to meet the other necessary 

6 expenses of the Advisory Panel. 

7 SEC. 4. CLIMATE CHOICE STOCK INDEX FUND. 

8 (a) IN GENERAL.—Section 8438 of title 5, United 

9 States Code, is amended— 

10 (1) in subsection (a)— 

11 (A) by redesignating paragraphs (4) 

12 through (10) as paragraphs (7) through (13), 

13 respectively; 

14 (B) by redesignating paragraphs (1), (2), 

15 and (3) as paragraphs (2), (4), and (5), respec16 tively; 

17 (C) by inserting before paragraph (2), as 

18 so redesignated, the following: 

19 ‘‘(1) the term ‘Climate Choice Stock Index 

20 Fund’ means the Climate Choice Stock Index Fund 

21 established under subsection (b)(1)(G);’’; 

22 (D) by inserting after paragraph (2), as so 

23 redesignated, the following: 

24 ‘‘(3) the term ‘entity’ means any sole propri25 etorship, organization, association, corporation, partVerDate Sep 11 2014 18:41 Apr 03, 2021 Jkt 019200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\S606.IS S606

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1 nership, joint venture, limited partnership, limited li2 ability partnership, limited liability company, or 

3 other business association, including any wholly 

4 owned subsidiary, majority-owned subsidiary, par5 ent-country national, or affiliate of the business as6 sociation, that exists for the purpose of making prof7 it;’’; and 

8 (E) by inserting after paragraph (5), as so 

9 redesignated, the following: 

10 ‘‘(6) the term ‘fossil fuel entity’ means any en11 tity— 

12 ‘‘(A) with proven carbon reserves; or 

13 ‘‘(B) that explores for, extracts, processes, 

14 refines, or transmits coal, oil, gas, oil shale, or 

15 tar sands;’’; and 

16 (2) in subsection (b)— 

17 (A) in paragraph (1)— 

18 (i) in subparagraph (E), by striking 

19 ‘‘and’’ at the end; 

20 (ii) in subparagraph (F), by striking 

21 the period at the end and inserting ‘‘; 

22 and’’; and 

23 (iii) by adding at the end the fol24 lowing: 


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1 ‘‘(G) a Climate Choice Stock Index Fund 

2 as provided in paragraph (6).’’; and 

3 (B) by adding at the end the following: 

4 ‘‘(6)(A) The Board shall select an index which 

5 is a commonly recognized index comprised of com6 mon stock. 

7 ‘‘(B) The historical performance of the index 

8 selected under subparagraph (A) shall be comparable 

9 to that of the other investment funds and options 

10 available under this subsection. 

11 ‘‘(C) The Climate Choice Stock Index Fund 

12 shall be invested in a portfolio that is designed— 

13 ‘‘(i) to replicate the performance of the 

14 index selected under subparagraph (A); 

15 ‘‘(ii) such that, to the extent practicable, 

16 the percentage of the Climate Choice Stock 

17 Index Fund that is invested in each stock is the 

18 same as the percentage determined by dividing 

19 the aggregate market value of all shares of that 

20 stock by the aggregate market value of all 

21 shares of all stocks included in the index se22 lected under subparagraph (A); and 

23 ‘‘(iii) to ensure that no investment in the 

24 portfolio is an investment with respect to a fos25 sil fuel entity.’’. 


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1 (b) EFFECTIVE DATE.—The amendments made by 

2 subsection (a) shall take effect— 

3 (1) only if the Federal Retirement Thrift In4 vestment Board, in the report submitted under sec5 tion 3(f)(2), indicates that the Board is unable to 

6 determine that it would be financially profitable, and 

7 consistent with the fiduciary duties of the Board, to 

8 implement low-carbon investment strategies; and 

9 (2) on the date on which the Board submits the 

10 report described in paragraph (1). 

Æ 


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