Symbolic, But Powerful

Amid COVID-19 outbreaks in NM private prisons, Education Retirement Board could finally divest from their operators

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Seventeen years ago, Ivonne Orozco and her family immigrated to the US, crossing the border from Mexico to make a permanent home here. Orozco went on to graduate from the University of New Mexico and become the state's 2018 teacher of the year.

She also co-founded an advocacy organization called Teachers Against Child Detention.

Orozco has a painful personal connection to immigration detention. Just one year after she and others crossed the border, her 18-year-old sister also tried to cross without the proper paperwork—and law enforcement detained her for 14 days.

"More than a decade later, she cannot talk about that time in her life without tears in her eyes," Orozco said of her sister at the New Mexico Educational Retirement Board's June meeting. "The filling of a bed with her body made a profit."

Orozco was one of seven people who spoke out during the meeting, one of over 100 who attended virtually and one of over 1,400 former and current educators and supporters who signed a petition circulated by a group calling itself NMERB Divestment Campaign, asking the board—again—to divest stocks purchased with teachers' retirement funds from private prison giants GeoGroup and CoreCivic.

The push to divest takes on a fresh urgency as COVID-19 infections ravage inmate populations in New Mexico, where a larger percentage of people are behind bars in for-profit lockups than in any other state in the nation. Private prisons have had 443 COVID cases, while state lockups report 825 cases as of Monday. Not counting inmates, Santa Fe County had under 600 reported cases by the same day.

The board seems poised to take up the issue, with support from at least two members after a year of pressure from the advocates. The divestment campaign group includes immigration activists, community members and New Mexico educators who want the board to stop investing in private prison operators and who pushed for the public hearing in June.

The Santa Fe and Española school boards, legal scholars and a financial expert have all sent letters to the board seeking the change.

Board Chairwoman Mary Lou Cameron tells SRF the board's investment committee will take up the issue of divestment during its meeting on Aug. 13. If the three-member committee approves the move, she says, "there's a good chance" the full board would finally take a public vote on the issue Aug. 14.

In addition to advocates' pressure, the long-awaited debate comes as the companies' stock prices decline and the national spotlight around criminal justice issues increasingly includes questions about the morality of prisons being run for dollars.

Sylvia Johnson, director of communications and outreach for the Santa Fe Dreamers' Project, tells SFR that members of the board told Johnson and other advocates divestment would be on the agenda for August.

Cameron says she is personally in support of divestment. As chair, she has the power to decide what goes on the agenda.

It's unclear if a divestment proposal would pass if put on the agenda. SFR attempted to contact all seven board members before publication to gauge their stance.

When asked his position on divestment, vice chair Russell Goff says he defers to Cameron, who "speaks for the board."

Another board member, elected state Treasurer Tim Eichenberg, signaled support for divestment, saying he has already made a verbal request for the issue to be taken up later this month.

As of June 30, the board held 28,400 shares of CoreCivic, worth $265,824 and 28,900 shares of GeoGroup worth $341,880, according to data provided by the board. The worth of those shares has decreased significantly since the beginning of 2019, when the ERB was invested in fewer shares that were worth nearly double what they are now.

Johnson has helped lead the divestment campaign over the last year. She tells SFR the pandemic and current events make it "even more evident" it's time to divest from GeoGroup and CoreCivic.

"The board and the director of the ERB have been completely resistant to engaging on this issue," Johnson says. "And I hope that they do it to the point where they take the action because we're basically offering them on a silver platter, a really easy way to do something symbolic, but also very powerful."

Jan Goodwin, the board's executive director, does not have voting power, but in an interview last week she stands by earlier statements made to SFR that the board can't divest because those two stocks would need manual work and take up resources and divesting would hurt the pension fund. Goodwin also cites a December recommendation from the board to the Legislature suggesting state lawmakers are best suited to consider whether divestment is appropriate.

However, Bob Jacksha, the board's chief investment officer, tells SFR if the board decided to divest, a trader would simply need to sell those stocks with "a little bit of manual work" a couple of times a month—without extra expense. Divesting from the stocks would not make a "significant financial difference," he adds.

"When the issue comes up, assuming the board wants to hear from me, that's what I'll tell them," Jacksha says.

Cameron hopes the time has come.

"We've had a lot of talk about it and we have not at times had enough consent to really put it out," she says. "We'll continue to talk about it and to bring it to the board. We also are looking at our policies that we're going to hopefully put in place on this issue."

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