david lillard

Democrats call on Tennessee to divest McDonald’s shares

The state Capitol on March 16, 2020. (Erik Schelzig, Tennessee Journal)

Democratic Reps. Yusuf Hakeem of Chattanooga and Joe Towns of Memphis are calling on state Treasurer David Lillard to divest Tennessee of its $80 million worth of shares in McDonald’s after 77 African-American former franchisees sued the company for allegedly denying them the same opportunities as white restaurant owners.

Here’s the letter Hakeem sent to Lillard this week:

Dear Treasurer Lillard, 

I write to concur with the request made of you by Representative Towns in September of this year to reconsider the Tennessee Treasury’s investment in McDonald’s stock. The allegations in the amended complaint filed against McDonald’s on behalf of 77 former Black franchisees are disturbing, and even more troubling is the significant decline in the number of McDonald’s Black franchisees. I share the concern expressed by Representative Towns’ that the Tennessee Treasury currently holds nearly $80 million of McDonald’s stock and I likewise believe we should use this moment to take a stand for racial equality and divest our state’s stock in McDonald’s.

Studies have shown that income inequality leads to higher rates of health and social problems. While these former franchisees sought to achieve the American dream and financial security, McDonald’s allegedly took steps to ensure that African-American owners were not afforded the same opportunity to succeed at the same levels as White franchisees financially. The State of Tennessee should not support any business that systematically engages in harmful practices to Black business owners and further widens the income gap. Sadly, the company has a well- documented history of racial discrimination and based on the allegations in the lawsuit; they still have much work to do. Until McDonald’s takes steps to correct its misdeeds, Tennesseans should not reward the company by holding onto nearly $80 million in its stock. Please call me at your convenience to discuss.

Sincerely,

/signed/

State Representative Yusuf Hakeem

Tennessee to allow weed investment to go pot

The “policy implications” of the state’s retirement fund’s investment into a company operating in the marijuana sector has Treasurer David Lillard ordering the shares be sold, according to a report by Andy Sher of the Chattanooga Times Free Press.

That’s despite a 26% gain in share price of San Diego-based Innovative Industrial Properties Inc. since the Tennessee Consolidated Retirement System’s small-stock fund bought 7,009 shares in April or May.

The company is a real estate Investment trust that bills itself as the “leading provider of real estate capital for the medical-use cannabis industry.”

The Chicago Sun-Times reported that Tennessee was among more than dozen states that stood to benefit from Illinois’ new recreational marijuana. Illinois is one of 11 states where Innovative Industrial Properties does business.

Michael Brakebill, the pension fund’s chief investment officer, told the Times Free Press that the investment into the company was part of a small-company stock index the state created.

Lillard said it’s difficult to evaluate every stock that’s part of an index, but that “we’ve got to figure out a way to do that and deal with it because it highlights the fact that you know what you’ve got in portfolio.”

The investment in Innovative Industrial Properties is worth about $720,000 out of the state’s $52 billion retirement system.

“The bottom line is I have ordered Michael and his staff to sell this investment, and we won’t have it after today or tomorrow, whenever the transaction goes down,” Lillard told the paper.

Tennessee lawmakers have balked in recent years to join states legalizing medical or recreational cannabis.