Ore. considers "socially responsible" college fund
By Associated PressPORTLAND, Ore. (AP) - Rob Huff and Katie Corson of Hood River were looking for a state-run college savings fund for their 2-year-old daughter Evie, but one in line with their ethics. They found that Oregon invests part of its funds in companies that sell cigarettes and junk food, promote gambling, harm the environment and do other things they don't like. They opted to forgo a $4,000 Oregon tax deduction and put $75,000 for Evie in a social choice investment fund offered by California. "We try to do socially responsible investing," Corson, a 40-year-old psychologist who does research for the federal Department of Veterans Affairs, told The Oregonian. "We assumed Oregon would offer something like that." The state's five-member college savings board is discussing such a fund for Oregon. "I'd like to take a look and see if we can make that fly for Oregon," said state Treasurer Randall Edwards, who heads the board. The board oversees the Oregon 529 College Savings Network, which operates three college savings plans under the federal tax code. There have been few requests for such a fund but now that the savings program has a firm foundation, the board is looking for enhancements, Edwards said. Oregon's programs have enrolled 66,972 investors who are putting away money for 103,172 children. Oregon's three savings plans total about $1 billion. Randall said the board will have to determine whether there is enough interest for a new fund and to find an investment plan that performs well. Gov. Ted Kulongoski has said he would support such an option. Criteria for such funds screen out businesses that harm the environment, threaten health, make weapons or promote services some deem harmful, such as gambling. Some are "green plans" that invest in sustainable businesses and those working to improve the environment and those may also be considered, said Michael Parker, executive director for the savings program. KLD Research & Analytics Inc., based in Boston, created an investment index focused on solutions to climate change called the Global Climate 100 Index plan. It produced a 53 percent return, about 15 percent a year since it was founded in mid-2005. Since California's social choice fund was created in 2000, it has drawn 11,917 investment accounts worth $59 million and has performed on par with a more traditional equity fund. Pennsylvania and Washington, D.C., also offer college saving plans with socially responsible investment options, but most states do not. Huff and Corson expressed their disappointment in a letter to Kulongoski last week. Oregon's fund invests in Altria Group Inc., until recently the parent company of Philip Morris USA Inc., which contributed to a campaign last year to defeat Measure 50, a proposal by the Legislature to use a cigarette tax to buy health coverage for Oregon's 116,000 uninsured children. "It is so hypocritical," Corson said. She and Huff, 44, a rare species biologist for the U.S. Forest Service, also object to investing Oregon college savings in Exxon Mobil Corp., other oil companies and Transocean Inc., the world's largest offshore drilling contractor. Another fund in Oregon's portfolio is Cash Advance Centers Inc., the nation's largest payday lender, which pulled its stores out of Oregon in the past year because of tighter laws. But Edwards said the board must focus on its core mission of helping families save for college. In trying to accommodate individual concerns, "you can get into a pretty slippery slope," he said. Some people, for example, do not want to invest in companies that do business with Iran, he said. Copyright 2008 The Associated Press. |
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October 14, 2008
- Roseburg, Oregon
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