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Governor Signs Permanent Fund Bills


June 17, 2004

Anchorage, Alaska - Governor Frank H. Murkowski has signed into law two bills related to governance of the Permanent Fund Corporation Board of Trustees, and the investment policy of the corporation. Murkowski signed the bills during an early morning meeting of the Permanent Fund board on Wednesday.

SB 326, introduced by the Legislative Budget and Audit Committee, Chaired by Anchorage Rep. Ralph Samuels, increases the limit on the Permanent Fund's "basket clause" from 5% to 10% of the total value of the Fund. In 1999 the Legislature created the basket clause to allow additional investment flexibility by authorizing investments in non-traditional assets (private equity and absolute return investments) or to be used to exceed asset limitations for traditional asset types.

"This increase is necessary because the 5% limit is too small to allow the Permanent Fund Trustees enough flexibility to keep up with changes in investment practices," Murkowski said. "Making this change will result in greater returns in the future."

SB 379, introduced by the Governor, would require that sufficient cause be shown for the removal of any of the four public members of the Alaska Permanent Fund Corporation Board of Trustees before the expiration of their terms. In addition to the four public members, the Commissioner of Revenue and the Attorney General serve on the board of trustees.

"This change will benefit the corporation in several ways," Murkowski said. "First, allowing public members to serve out their full terms will bring continuity to the board, particularly in a climate where investment methods have become more complex and sophisticated. Second, new cabinet members will benefit from the experience of sitting board members. And, third, board members will be allowed to act as fiduciaries by limiting the amount of political pressure that can be placed on a board. So, these are good changes, and it is a pleasure to be able to sign this bill."


Source of News Release:

Office of the Governor
Web Site



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