Amidst Russia’s violent and unprovoked invasion of Ukraine, California leaders are calling on state pension systems to cut financial ties to Russia. According to a letter sent to CalPERS, CalSTRS, and University of California Retirement Plan chairs on Monday, California holds over $1.5 billion in investments in relation to Russia’s financial markets.

The letter directed the funds to halt the flow of money from California to Russia but fell short of demanding the sale of Russian holdings. Instead, Governor Newsom requested the pension funds to update his office within 10 days on recommendations to implement financial sanctions on Russia while protecting the interests of retirees.

On the same day Governor Newsom issued his letter, members in the Legislature announced plans to introduce legislation that would require all state agencies to divest from Russian assets. Although not yet in print, the bill is reportedly supported by a broad, bipartisan coalition of Senators and Assembly Members.

Once introduced, this bill will join another divestment bill pending in the Legislature, SB 1173 by Senator Gonzalez. SB 1173 prohibits CalPERS and CalSTRS from making new investments in the fossil fuel industry and requires the funds to liquidate investments in fossil fuel companies by July 1, 2027.

The public calls above have only referenced state pension systems, but at least one legislator, Assembly Member Chad Mayes, has said he would support including county 37 Act retirement systems in the requirement to divest.

CalPERS responded this morning, March 3, announcing that they have halted investments in Russia and noting that the current sanctions and market restrictions have significantly limited their ability to liquidate their holdings. They own no Russian government debt but do own shares of publicly traded companies and some real estate.