you're reading...

Campus News

Task Force Will Assess Feasible Alternatives to Bank of America

by Christian Diaz, News Editor

On March 6 Caucus approved a proposal to examine how the college might phase out its relationship with Bank of America (BOA) by a margin of 16 to three abstaining votes.

The mandate calls for the creation of a task force that will research alternative financial institutions that can support the school’s budget, and a timeline for the responsible withdrawal of funds from BOA. The task force should be assembled no later than March 27.

The proposal was designed by members of the BOA FREE WWC (BFW) student group, who are alarmed by the discrepancy between the values of the college and the socially and environmentally degrading activities that BOA both practices and supports. The group has collected over 120 petitions from WWC faculty, staff and students who want BOA off their campus.

“This is an opportunity for the campus to continue being a leader in social justice,” said BFW member Karlyn Hunt at a presentation given to WWC students Feb. 28.

The initiative is inspired by the responsible banking movement that began Nov. 11, 2011 with Bank Transfer Day. Since then, over one million people have moved their funds from large institutions to smaller, non-profit community banks and credit unions that are open to public control and purpose.

According to the movement, everything is tied to financing and according to BFW, any social issue that students are passionate about can be addressed through university finances.

VP of Finance Jon Ehrlich explained, however, that withdrawal from Bank of America cannot happen at this time. The college is indebted to BOA, and the terms of this debt inextricably tie WWC to BOA.

If the college were to pursue divestment, transferring funds from one institution to another would cost around $1.5 million. The transfer would also move the college to a relationship with a different, but equally large bank.

“It’s hard to say that it’s not possible because it looks bad on the administration,” Ehrlich said, “but we have to be realistic and clarify what can and cannot be done.”

WWC has had a working relationship with BOA for 25 years and currently has a $33 million operating budget, the funds of which are held by BOA in 14 separate accounts. Bank of America is the most competitive in terms of what it can offer the college.

BFW understands that divestment won’t happen this semester, or the next. But in the long run, students should be vocal about their unease with the relationship. The group has held meetings with the Administration, and also with Board of Trustees member Joel Adams, who connected the group to an environmental lawyer.

The most difficult part of divestment would be finding local institutions that are willing or able to manage such a large account. The benefit of maintaining a relationship with Bank of America is that it is too big to fail. The school’s assets are safe there.

Furthermore, the college has invested in sophisticated methods of electronic banking that make the managing of funds efficient and paperless. If the college suddenly needed to move a large sum of money, it would be able to do so with relative ease through BOA.

The Administration argues that smaller institutions would be unable to accommodate large transactions because these would shift a large portion of the community banks’ own budget.

But the ethical question remains: does convenience overrule the values of the college? And should students have a say in where their tuition dollars are placed? The reasons cited for removing school finances from BOA are many, according to BFW.

These include the role BOA played in precipitating the global recession in 2008, as well as its affiliation with coal companies that employ mountain top removal (MTR) as a means of extraction in Appalachia.

In 2008, BOA committed to phasing out its financial support for companies that use MTR as their “predominant” means of extraction, though it is difficult to gauge how the financial giant defines the word “predominant.”

BFW cites the Rainforest Action Network’s assessment of BOA, which received a C- in their Policy and Practice 2011 Report Card on Banks and Mountain Top Removal. The grade suggests that BOA has declared intentions to curb its support for MTR, but so far there have been more words than action on behalf of the bank. According to RAN, BOA has contributed over $4.3 billion to the coal industry in the past two years.

Despite these figures, some students have expressed concern over the proposal.

“I don’t know if [divestment] is something we need to demand,” Sophomore Alessia Faverio said. “I’m for the part of the proposal that’s putting forth a committee to look at options of where we could keep our money, but I’m not sure that we should rule out BOA.”

Other caucus members demonstrated concern over the implications of divestment on tuition. Though tuition hikes are generally frowned upon, the college has decided collectively before to raise tuition in exchange for a more sustainable food program.

To some caucus members, the conversation has been one-sided up to this point, focusing solely on the detrimental effects BOA has had on the global community. The Administration mirrors this sentiment; according to them, the issue of corporations is complex, not black and white.

Some ask that the community acknowledge Bank of America’s support for gay rights. As of this year, BOA will reimburse employees for the extra taxes they pay in order to cover same-sex partners under the company’s health insurance policy.

In general, caucus members asked for more information on this complex issue, especially from hard sources. “We’re appreciative of all feedback, and it’s necessary to get responses from students,” Sophomore and BFW member Eva Westheimer said.

The second draft of the proposal that was passed included an attached list of sources that is longer than the proposal itself.

The bank’s positive relationship with Warren Wilson softens its image for many students and staff. BOA has been willing to provide the college with low-interest loans to make up for damaged property during years when budgets are tight. As of now, BOA has loaned $2.75 million to the college for repairs and maintenance.

Members of the BFW are aware of the cozy relationship between BOA and WWC, and they don’t pretend to have the answers as to how the college can best phase out of this relationship.

“We are asking the school, which has a lot more expertise, to look at this and to commit to making this a priority,” Hunt said. “It is so much easier to not be sustainable, but if we are truly committed to sustainability on this campus then we can’t use convenience as an excuse.”

In the short-run, the Administration says it has its hands tied. “Although I think it’s perfectly appropriate for students to inquire about any College practices that are not protected by confidentiality, we always want to temper idealism with pragmatics,” President of the College Sandy Pfeiffer said.

At a meeting between the president and caucus co-conveners, the possibility of inviting members from Bank of America to meet with students arose. The Administration believes that both students and representatives from BOA could learn from each other. However, it is unclear whether such a meeting will take place.


No comments yet.

Post a Comment

Stories by Category