State Legislature to Consider Graham Bill Limiting South Africa-Linked Contracts

In upcoming months the Massachusetts legislature will consider a measure which would make the state the first in the nation to set strict guidelines for contracts with U.S. companies that have not divested from South Africa or Namibia.

The bill, sponsored by State Rep. Saundra Graham (D-Cambridge), received a favorable report from the State House Administration Committee last month, and is now being examined by the House of Representatives' Ways and Means Committee. It will be sent to the House for floor debate after receiving the approval of that committee.

While Massachusetts has already divested several state pension funds of South African linked investments, the Bay State still contracts with several companies which are doing business in southern Africa.

The proposed bill would set up an "apartheid list" of companies that are doing a large amount of business with South Africa, such as IBM, the Bank of Boston, Control Data Corp., and Texaco, said Robert D. Slate '83, Graham's legislative aide.

The state's Office of Federal Relations estimates that the total dollar value of state purchases in fiscal year 1985 from businesses with South African links is close to $50 million.

The estimated dollar value of purchases from such companies for the first three months of 1987 is $12 million from 36 American companies, 12 of which are wholly or partly based in Massachusetts, Slate said.

The proposed bill is designed to "get tough" with companies that insist on keeping ties with countries that allow "the horrors of apartheid to continue," Slate said.

The bill states that the only contracts to be accepted from companies on the "apartheid list" are those that the state's Secretary of Administration and Finance determines to be an essential purchase, or when the company is the only bidder for the contract, or if the bid is necessary to ensure a competitive bidding process.

All other contracts will go to companies without ties to South Africa.

"This is the first major bill that uses a new definition of divestment," said Slate. "It will not exempt the whole trend of companies that only semi-divest," he said.

Slate said he was referring to companies such as Coca-Cola, which considers itself divested because it sells its local distribution centers to Blacks, but still sells its syrup to the country.

Under Graham's proposal, Coca-Cola would not be exempt from the "apartheid list," Slate said.

The bill has received attention from major companies such as Coca-Cola, whose senior vice-president came to Boston to discuss the bill with Graham last month, Slate said.

"It is very necessary for the western world in general to make a pronouncement on the abhorrance of apartheid," said Themba Vilakazi, co-coordinator of the South African Support Coalition of Massachusetts (SASCOM), an organization which helped to draft the bill.

"This kind of legislation is good because it really affects the bottom line for businesses--dollars and cents," Vilakazi said. "We support sanctions and anything that makes it tougher for companies to do business as usual," he said.