Can Zohran Mamdani divest NYC from Israel? His likely comptroller, Mark Levine, dismisses the concern.

The politician expected to become the city’s top financial manager in January is dismissing concerns that Zohran Mamdani, if elected mayor, could divest from Israel.

Mamdani is a supporter of the Boycott, Divestment and Sanctions movement against Israel. He has publicly backed a permanent end to investing the city’s pensions funds in Israel bonds. 

But Mark Levine, the Democratic candidate for comptroller, said in an interview that there is “no real track record of the mayor driving significant investment decisions” in the city’s pension funds — and that if Mamdani or anyone else tried, they would have a hard time making an impact.

The mayor “certainly couldn’t act singlehandedly,” said Levine, noting that investment decisions are made by boards on which the mayor has just a single appointee. “Just doesn’t have the votes for that.”

Meanwhile, Levine, who is Jewish and a fluent Hebrew speaker, said months ago that he intends to invest in Israel bonds and has doubled down since.

“Israel bonds have never missed a payment in 80 years. They pay excellent interest,” he said.

Levine’s comments come as Mamdani, the Democratic candidate, solidifies frontrunner status ahead of the November election. As attention turns to how the 33-year-old democratic socialist might try to put his progressive ideas into reality, Levine’s assurances highlight the checks in place within city government that could prevent him from doing so. 

Since the 1970s, Israel bonds had been part of the city’s investment portfolio. But in 2023, the current comptroller, Brad Lander, decided not to reinvest after the $39 million in Israel bonds matured. Mamdani, who cross-endorsed Lander in the mayoral primary, said earlier in September that he supported the “current comptroller’s approach” to Israel bonds.

Separate from the money in Israel bonds, New York City pension funds hold more than $300 million in Israel-based assets. 

Mamdani has stopped short of saying he would divest from all Israeli businesses, and has said that his platform is “not the same as national DSA,” the Democratic Socialists of America party of which Mamdani is a member. The DSA has made BDS support a “litmus test” for candidate endorsement.

Still, some are concerned that a Mamdani administration could at some point seek to divest from Israel entirely. A recent op-ed in the Jerusalem Post treated the prospect as a given, speculating that Mamdani would “move on to the private companies” after divesting from Israel. The piece concludes that there is “no other way to look at it, because he would have the option to act as he pleases once in office.”

That’s not right, according to Levine. “The comptroller has outsized influence over the investment decisions that we make,” he said. 

For each of the city’s five pension funds to pass any investment decisions, its board of trustees must vote in favor. Those boards vary in size, but typically consist of the comptroller, an appointee by the mayor, and a number of labor representatives. Recommendations are made to those boards by the comptroller’s in-house Bureau of Asset Management.

“The mayor has only one vote, and there’s no real track record of the mayor driving significant investment decisions in our pension funds, for that reason,” Levine said. He added that investment decisions are “generally led by the comptroller, in consultation with municipal labor trustees.”

Elizabeth Holtzman, who was New York City’s comptroller from 1990 until 1993, said in an interview that the comptroller typically has a leg up when communicating with the pension fund boards.

“The mayor isn’t spending a lot of time dealing with pension issues and with the boards — the comptroller is,” Holtzman said. “So you have a much closer working relationship.”

There are more obstacles to divesting from a country’s businesses than just the governance structure, Holtzman added. During her term as comptroller, Holtzman and Mayor David Dinkins were aligned on the idea of divesting from South African companies to protest that country’s racial apartheid. Even with both parties in agreement, she said, the process was arduous, she recalled.

“The mayor and I, even though we despised the policies of South Africa, couldn’t just snap our fingers and divest from stocks in South Africa,” Holtzman said.

The move to divest needed to pass a “serious legal analysis” assessing that it met fiduciary standards by the Corporation counsel, the city’s top lawyer.

“You’re supposed to make the decisions on investments based on a professional analysis of the risk versus return,” Holtzman said. “So if you’re going to divert from the standard risk-versus-return analysis — you are a fiduciary, so you better have facts to back you up.”

Andrew Cuomo, Mamdani’s foremost challenger in the election, touched on Lander’s divestment from Israel bonds in a speech at a synagogue during the mayoral primary, hinting that Lander was part of the problem of rising antisemitism.

Mayor Eric Adams, who is also running against Mamdani, has said Lander’s decision not to reinvest in Israel bonds echoes the goals of the BDS movement — but the comptroller rejected that idea, insisting that his decision was fiduciary, not political, and that unlike Mamdani he does not support the movement.

“The BDS Movement asks investors to treat Israel worse than other countries; I oppose this effort,” Lander wrote in response. “You appear to be asking that the city’s pension funds treat Israel better than all other countries. That would also be politically motivated, and inconsistent with fiduciary duty.”

Levine said he believes investing in Israel bonds is a “sound financial decision,” and that “almost every pension fund in America” has money invested in Israel bonds. (Palm Beach County in Florida has invested $700 million, making it the single largest bond-holder.) Holtzman said she was inclined to agree.

“I don’t know the history of what’s happened with the Israel bonds,” Holtzman said. “But I’m pretty sure that they’ve been paid over all these years, which might be an indication of how to evaluate the risk.”

Despite their differences on Israel, Levine endorsed Mamdani shortly after his primary victory in June. The pair’s politics are overlapping in some respects — Levine was a member of the Progressive Caucus while on the City Council and they both spoke at a pro-union rally outside a hotel in August, where they confirmed their mutual endorsement. 

“I’m proud to support the full Democratic ticket, and, yes, that also includes our soon-to-be comptroller,” said Mamdani, who’d backed Levine’s opponent, Justin Brannan, in the primary.  

Levine said their differing positions on the Israeli-Palestinian conflict should not get in the way of the bulk of their work.

“I don’t believe that has to interfere with policy on transportation, sanitation,” Levine said. “I think mostly the core functioning of government is more technocratic, if you will. It’s just about delivering good services in a way that is transparent and gets the most for taxpayer dollars.”

The city pension funds, which serve more than 750,000 public servants, hold $294 billion in assets; the $300-plus million invested in Israeli companies comprise about 0.1% of that total.