West Virginia advances bill punishing banks for cutting oil ties

West Virginia’s legislature has approved a proposal that could restrict the state’s work with financial institutions that have limited their business with coal and oil companies. 

The measure, Senate Bill 262, is now under consideration by Republican Gov. Jim Justice, after clearing both chambers over the weekend. If enacted, the legislation would allow state Treasurer Riley Moore, also a Republican, to create a list of restricted financial institutions that “have been shown to refuse, terminate or limit commercial activity with coal, oil or natural gas companies without a reasonable business purpose,” his office said in a statement Monday.

Moore, who proposed the bill, obtains banking contracts for the state and approves such agreements for state agencies. West Virginia’s approved depositories include dozens of banks, such as JPMorgan Chase and Wells Fargo. 

Jared Hunt, a spokesperson for Moore’s office, said the state has paid banks annual fees ranging from thousands of dollars to upward of $3 million, depending on the amount of transactions handled. 

He said the treasurer’s office doesn’t have a list of financial institutions that it expects would be restricted by the legislation.

West Virginia would be following the lead of Texas, which last year prohibited government contracts with, or pension investments in, companies that have shunned fossil-fuel producers. 

The group behind the Lone Star State’s measure, the Texas Public Policy Foundation, has shared model legislation to states through the American Legislative Exchange Council, a corporate-funded lobby that disseminates bills popular among Republicans. Jordan Damron, a spokesperson for the governor, didn’t immediately respond to a request for comment.

— With assistance from Shelly Hagan.