December 8, 2002

Robert D. Walton
Interim Chief Executive Officer
California Public Employees Retirement System
400 P Street
Sacramento, Ca. 95814

Dear Mr. Walton,

The Redwood Chapter of the Sierra Club and its 10,000 members are deeply concerned about CALPERS retirement funds being invested in the deforestation of California's precious wild land resources.

The coastal temperate rainforests of the North coast counties, as well as Napa, and Lake County are suffering the rampant loss of Redwoods, Douglas Fir, mixed Oak Woodlands and chaparral from the unprecedented expansion of vineyards into our wild land resources. This disturbing fragmentation of our natural communities is clogging our rivers with sediment, diverting our scarce fresh water sources, disrupting wildlife corridors and robbing us of our natural heritage for generations to come.

Intact native wild land habitats are repositories of species diversity. Eighty percent of all municipal water supplies are derived from forest lands. Both our marketable commodity forest and our non - commodity forests need equal protection. Native vegetation types, including valuable mountain meadows and grasslands, provide food and habitat for wildlife.

CALPERS, the country's largest, and one of the most successful public retirement trust funds, has just announced a new policy of investing a portion of their financial portfolio in vineyard conversion projects. Many grass roots environmental groups are springing into action to oppose such vineyard projects. We feel PERS should be encouraging sustainable agricultural practices to avoid the depletion of our scarce water resources and the destruction of our native wild land habitats to make way for new commercial vineyard operations.

Loss of habitat does not happen in large, sudden, leaps but in small, cumulative, steps over time. We feel that CALPERS, as a responsible institution, should only allow financing of agricultural developments that permit a long term, sustainable agricultural use, which may include conversions from fields, orchards, or historically open pasturage (provided that reforestation recovery has clearly not occurred) to vineyards It is the policy of the Redwood Chapter of the Sierra Club to oppose wild land conversions to vineyard.

"By treating fish and wildlife as disposable resources, we are losing our biologic heritage," Gerald Meral. CALPERS should be a leader in protecting that heritage.

Sincerely,

Margaret Pennington
Chair, Redwood Chapter Sierra Club