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PHOENIX — State lawmakers are moving on several fronts to create a legal link between Arizona's investments and morality.

But how tight that link would be varies.

A measure awaiting action by the full House would force the state treasurer and all of the state's retirement plans to sell off any holdings they have in oil companies that do business in Iran. HB 2151 would force the divestiture regardless of the potential financial loss to the state.

Separately, the Senate on Wednesday gave final approval to legislation forbidding investment in certain types of companies that do business in Sudan. HB 2705, however, contains an escape clause: It would not apply if the financial hit to the state was more than minimal.

And a third measure making its way through the Senate seeks to get all state and retirement funds out of any company that does business in any country identified in federal law as supporting global terrorism. SB 1489, though, uses a sort of middle ground for a guidepost: Each organization's trustees would decide how much of a financial loss they could bear in order to comply.

Central to all three proposals is a desire by some lawmakers to keep public money from being used in ways that either harm American interests or, in the case of Sudan, engage in what proponents of the legislation say is organized genocide in Darfur.

Where they differ is how much the actual dollar loss matters.

The most direct — and least flexible — of the proposals deals with Iran.

Federal law already prohibits most U.S. companies from trading with Iran.

But Rep. Jonathan Paton, R-Tucson, said that doesn't cover firms such as Shell Oil. He said these foreign petroleum firms enrich the government there so it, in turn, can supply explosives to Shiite militias in Iraq.

"So when they tell you that Iran has nothing to do with the killing of our soldiers, sailors, airmen, Marines, they're dead wrong," he told the House Government Committee. "They're actively involved in trying to kill our men and women in uniform."

The vote on HB 2151 came over the objections of Lesli Sorensen of the Arizona State Retirement System, which covers most state employees and public-school teachers. She said the measure in its current form could force her agency to get rid of between $58 million and $133 million without regard to the financial implications.

Paton acknowledged that one potential problem for his legislation could be a legal requirement in Arizona for the guardians of state money to seek the highest and safest returns on their investments. He said, though, that if fund managers believe there's money to be made in oil companies, they could switch their holdings from foreign companies to firms such as Exxon Mobil, a domestic company that cannot do business in Iran.

But Paton said there should be a limit to the search for the most dollars. "Yes, there's a fiduciary responsibility" to get the most return, he said.

"But we're funding people that are killing soldiers," Paton continued. "I don't know how else to put it."

The measure on Sudan, sponsored by Rep. Kyrsten Sinema, D-Phoenix, seeks to avoid the whole fight over its legality with some specific guideposts: It would exempt fund managers from having to sell off interests in specified companies if the evidence shows that the move would result in a loss of one-quarter of 1 percent.

But Sinema said that does not make her desire to stop supporting that regime conditional on money.

Nor does she believe that the trigger makes her measure meaningless. She said the experience in the 22 other states with similar legislation shows they can, in fact, sell off the investments and actually increase the value of the portfolios.

HB 2705 gained unanimous approval of the Senate on Wednesday and now goes to the governor.

The third proposal, SB 1489, is being pushed by Senate Majority Leader Thayer Verschoor, R-Gilbert. It links state and retirement system investments to the federal Export Administration Act.

That law, first approved in 1949 at the beginning of the Cold War, is aimed at preventing the exporting of U.S. consumer products that also could have military uses. As part of that process, the federal government has to identify which countries support terrorism.

Verschoor's measure, awaiting a Senate vote, requires selling off investments in companies that do business in countries identified by the federal government. But Kimberly Yee, a lobbyist for the state Treasurer's Office, said there is some flexibility for fund managers in her agency and the retirement funds to decide what to sell and when to sell it.