State Rep. Saundra M. Graham (D.-Cambridge) yesterday introduced a bill in the Massachusetts House that would bar Massachusetts universities with South African-related investments from issuing tax-exempt bonds.

The bill, drafted by Harvard undergraduate Noah M. Berger '89 and other members of the South African Solidarity Committee (SASC), was co-sponsored by State Sen. Michael J. Barrett '70, also of Cambridge.

Although some state legislators expressed enthusiasm for the bill, they said they were skeptical about the measure's chance of making it to the Governor's desk.

"Ninety percent of bills fail," said Osborne. The measure now goes before the House Rules Committee, which will either kill the bill or refer it to a House committee.

"The situation in South Africa has made people attentive to the severity of the situation," said Larry Kraus, a legislative aide to the bill's House sponsor. But he said the fact that the bill was introduced late in the session will make passage more difficult, he added.

No Tears For Harvard

Cambridge City Councillor David E. Sullivan said he strongly endorses the bill. "Public money should be used in a socially responsible way," he said. "If we support the racist regime in South Africa, the opposite is true."

As an added bonus, Sullivan said, the bill would cut down on Harvard's expansion into Cambridge's residential neighborhoods. "If Harvard can't expand because it is ineligible to issue bonds, I won't be shedding any tears," he said.

Proponents of the measure said enactment could induce Harvard, which has been the main beneficiary of state-sponsored tax-exempt bonds, to divest in order to continue expanding. Harvard stands to lose between $20 million and $130 million in revenues if the measure passes, said Berger.

One of the major goals of the bill is to encourage Harvard to divest immediately from companies with South African ties, said David Osborne, a spokesman for Barrett. "As an alumnus of Harvard, Barrett supports the use of state control over tax-exempt status for social gain," Osborne added.

Kraus said Graham believes Massachusetts should not "subsidize" South Africa in any way. "Institutions of higher learning need tax-exempt bonds to bring in revenue for facilities maintenance," Osborne said. "The bill makes institutions investing in South Africa ineligible to issue those bonds."

The measure's supporters plan to send students and activists to lobby for the measure on Beacon Hill before they seek more legislative co-sponsors, said Berger.