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HD 3792

An Act authorizing independent retirement systems to divest from fossil fuel companies

194th Legislature (2025-2026) Introduced by Dylan Fernandes and 1 co-sponsor

Massachusetts independent public retirement systems would be allowed to divest from fossil fuel companies and reinvest in non-fossil fuel options through existing procurement proce

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Bill Summary · HD 3792

Summary: HD 3792 — An Act authorizing independent retirement systems to divest from fossil fuel companies

Overview

HD 3792 proposes to authorize Massachusetts independent public retirement systems to divest, in whole or in part, from fossil fuel companies. Following the required procurement process, the boards of these systems would be permitted to shift investments away from fossil fuel companies and into index funds or other investment vehicles that do not include fossil fuel investments. The act takes effect upon passage.

Purpose and intent

  • Allow independent public pension systems in Massachusetts to align investment practices with fossil fuel divestment goals.
  • Provide a legally/frameworked path to exclude fossil fuel investments while maintaining fiduciary options for investment through alternative vehicles.

Key provisions

  • Definitions (Section 1):

    • “Independent retirement system” means any Massachusetts public pension system overseen by the Public Employee Retirement Administration Commission (PERAC).
    • “Fossil fuel company” means a company classified by Global Industry Classification Standard (GICS) in one of these sectors: (1) coal and consumable fuels; (2) integrated oil and gas; (3) oil and gas exploration and production.

  • Divestment authority (Section 1):

    • Independent retirement systems may divest, in whole or in part, from fossil fuel companies.
    • Divestment decisions would be made in accordance with the procurement process described in Section 23B of Chapter 32 of the General Laws.

  • Post-divestment investments (Section 1):

    • After following the Section 23B procurement process, boards may invest in index funds or other investment vehicles that do not include fossil fuel companies.

  • Effective date (Section 2):

    • The act would take effect upon passage.

Who is affected

  • Primary: Independent retirement systems in Massachusetts (public pension plans) governed or overseen by PERAC.
  • Indirect: Fossil fuel companies holding investments in these retirement systems and the broader investment ecosystem affected by any shift to fossil fuel–free vehicles.

Procedural and timeline aspects

  • The bill requires compliance with the existing procurement framework under Section 23B of Chapter 32 for making divestment decisions.
  • There is no phased timeline or sunset; the divestment option is available once the bill is enacted and takes effect on passage.

Context and notes

  • This is a proposed bill in the 2025-2026 General Court session.
  • A related measure previously appeared in 2023-2024 as House Bill 2515, indicating prior consideration of fossil fuel divestment by Massachusetts retirement systems.

Potential considerations

  • Fiduciary impact: The bill preserves the right to divest while requiring adherence to established procurement processes, potentially affecting returns, risk, and diversification strategies.
  • Administrative burden: Implementation would require governance adjustments to ensure compliant divestment and reallocation to non-fossil fuel vehicles.

Compiled from official sources — confirm details with the bill’s official record.

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