I

104TH CONGRESS

1ST SESSION H. R. 1594

To place restrictions on the promotion by the Department of Labor and

other Federal agencies and instrumentalities of economically targeted

investments in connection with employee benefit plans.

IN THE HOUSE OF REPRESENTATIVES

MAY 9, 1995

Mr. SAXTON (for himself, Mr. ARMEY, Mr. HASTERT, Mr. ISTOOK, Mrs.

KELLY, Mrs. SEASTRAND, Mr. HASTINGS of Washington, Mr. HOKE, Mr.

COX of California, Mr. MANZULLO, Mr. EWING, Mr. SANFORD, Mr.

LAHOOD, Mrs. MEYERS of Kansas, Mr. STUMP, Mr. SCARBOROUGH, Mr.

UPTON, Mr. HEINEMAN, Mr. LARGENT, Mr. SMITH of Texas, Mr.

THORNBERRY, Mr. DOOLITTLE, Mr. EHRLICH, Mr. ROHRABACHER, Mr.

CUNNINGHAM, Mr. SALMON, Mr. BARTLETT of Maryland, Mr. BOEHNER,

Mr. MILLER of Florida, Mrs. CHENOWETH, Mr. HERGER, Mr. BARTON

of Texas, Mr. LATHAM, Mr. LIVINGSTON, Mr. GEKAS, Mr. HILLEARY,

Mr. TALENT, Mr. WALSH, and Mr. DELAY) introduced the following bill;

which was referred to the Committee on Economic and Educational Opportunities

A BILL

To place restrictions on the promotion by the Department

of Labor and other Federal agencies and instrumentalities of economically targeted investments in connection

with employee benefit plans.

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. SENSE OF THE CONGRESS.

2 It is the sense of the Congress that economically tar3 geted investments violate sections 403 and 404 of the Em4 ployee Retirement Income Security Act of 1974 (29

5 U.S.C. 1103 and 1104) because they violate the principle

6 of undivided loyalty that a fiduciary owes to employee ben7 efit plan participants and beneficiaries and are made with

8 the intent to benefit persons other than plan participants

9 and beneficiaries and to serve interests other than those

10 of plan participants and beneficiaries.

11 SEC. 2. PROHIBITIONS ON DEPARTMENT OF LABOR RE12 GARDING ECONOMICALLY TARGETED IN13 VESTMENTS.

14 (a) IN GENERAL.—With respect to the investment by

15 employee benefit plans of plan assets (and the interpreta16 tions and decisions by the Department of Labor regarding

17 investment by such plans of plan assets), the application

18 of sections 403 and 404 of the Employee Retirement In19 come Security Act of 1974 (29 U.S.C. 1103 and 1104)

20 shall be determined—

21 (1) without regard to Interpretive Bulletin 94–

22 1, issued by the Secretary of Labor on June 23,

23 1994 (59 Fed. Reg. 32606; 29 C.F.R. 2509.94–1),

24 and without regard to any other regulation, interpre25 tive bulletin, advisory opinion, information letter, or

26 other determination reaching the same result as, or
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1 a result similar to, the result set forth in such Inter2 pretive Bulletin, and

3 (2) with full regard to sections 403 and 404 of

4 such Act.

5 (b) RESTRICTIONS ON ACTIVITIES OF THE DEPART6 MENT OF LABOR.—No officer or employee of the Depart7 ment of Labor may travel, lecture, or otherwise expend

8 resources available to such Department for the purpose

9 of promoting, directly or indirectly, economically targeted

10 investments.

11 (c) DEFINITIONS.—For purposes of this section—

12 (1) ECONOMICALLY TARGETED INVESTMENT.—

13 The term ‘‘economically targeted investment’’ has

14 the meaning given such term in Interpretive Bulletin

15 94-1, as issued by the Secretary of Labor on June

16 23, 1994 (59 Fed. Reg. 32606; 29 C.F.R. 2509.94–

17 1).

18 (2) EMPLOYEE BENEFIT PLAN.—The term

19 ‘‘employee benefit plan’’ means an employee benefit

20 plan within the meaning of section 3(3) of the Em21 ployee Retirement Income Security Act of 1974 (29

22 U.S.C. 1002(3)) which is covered under section 4 of

23 such Act (29 U.S.C. 1003).
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1 SEC. 3. PROHIBITION ON FEDERAL AGENCIES AGAINST ES2 TABLISHING OR MAINTAINING ANY CLEAR3 INGHOUSE OR OTHER DATABASE RELATING

4 TO ECONOMICALLY TARGETED INVEST5 MENTS.

6 (a) IN GENERAL.—Part 5 of subtitle B of title I of

7 the Employee Retirement Income Security Act of 1974

8 (29 U.S.C. 1131 et seq.) is amended by adding at the end

9 the following new section:

10 ‘‘PROHIBITION ON FEDERAL AGENCIES AGAINST ESTAB11 LISHING OR MAINTAINING ANY CLEARINGHOUSE OR

12 OTHER DATABASE RELATING TO ECONOMICALLY

13 TARGETED INVESTMENTS

14 ‘‘SEC. 516. (a) IN GENERAL.—No agency or instru15 mentality of the Federal Government may establish or

16 maintain, or contract with (or otherwise provide assistance

17 to) any other party to establish or maintain, any clearing18 house, database, or other listing—

19 ‘‘(1) for the purpose of making available to em20 ployee benefit plans information on economically tar21 geted investments,

22 ‘‘(2) for the purpose of encouraging, or provid23 ing assistance to, employee benefit plans or any

24 other party related to an employee benefit plan to

25 undertake or evaluate economically targeted invest26 ments, or
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1 ‘‘(3) for the purpose of identifying economically

2 targeted investments with respect to which such

3 agency or instrumentality will withhold from under4 taking enforcement actions relating to employee ben5 efit plans under any otherwise applicable authority

6 of such agency or instrumentality.

7 ‘‘(b) ECONOMICALLY TARGETED INVESTMENT DE8 FINED.—For purposes of this section, the term ‘economi9 cally targeted investment’ has the meaning given such

10 term in Interpretive Bulletin 94–1, as issued by the Sec11 retary on June 23, 1994 (59 Fed. Reg. 32606; 29 C.F.R.

12 2509.94–1).’’.

13 (b) CLERICAL AMENDMENT.—The table of contents

14 in section 2 of such Act is amended by inserting at the

15 end of the items relating to part 5 of subtitle B of title

16 I the following new item:

‘‘Sec. 516. Prohibition on Federal agencies against establishing or maintaining

any clearinghouse or other database relating to economically

targeted investments.’’.

17 SEC. 4. TERMINATION OF CONTRACTS.

18 The head of each agency and instrumentality of the

19 Government of the United States shall immediately take

20 such actions as are necessary and appropriate to terminate

21 any contract or other arrangement entered into by such

22 agency or instrumentality which is in violation of the re23 quirements of the provisions of this Act or the amend24 ments made thereby.
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1 SEC. 5. EFFECTIVE DATE

2 The preceding provisions of this Act (and the amend3 ments made thereby) shall take effect on the date of the

4 enactment of this Act.

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