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HB 213: "An Act relating to the investment, appropriation, and administration of the public school trust fund."

00                             HOUSE BILL NO. 213                                                                          
01 "An Act relating to the investment, appropriation, and administration of the public                                     
02 school trust fund."                                                                                                     
03 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA:                                                                
04    * Section 1. AS 37.14.110(c) is amended to read:                                                                   
05 (c)  The commissioner of revenue shall determine the net income of the fund in                                          
06 accordance with investment accounting principles [AND IN A MANNER THAT                                                  
07 PRESERVES THE DISTINCTION BETWEEN PRINCIPAL AND INCOME AND                                                              
08 THAT EXCLUDES CAPITAL GAINS OR LOSSES REALIZED ON PRINCIPAL].                                                           
09 The principal of the fund [AND THE CAPITAL GAINS OR LOSSES REALIZED                                                     
10       ON PRINCIPAL] shall be perpetually retained in the fund for investment purposes.                                  
11    * Sec. 2. AS 37.14.160 is amended to read:                                                                         
12            Sec. 37.14.160. Duties of the commissioner of revenue. The commissioner of                                 
13       revenue is the treasurer of the trust fund created in AS 37.14.110 and shall                                      
14                 (1)  in carrying out investment duties under this section, exercise the                                 
01       same powers and duties established for the Alaska Retirement Management Board in                                  
02       AS 37.10.220;                                                                                                     
03                 (2)  deposit the principal and income from investments in separate                                      
04       principal and income accounts for the fund;                                                                       
05                 (3)  invest and maintain accounting records that distinguish between the                                
06       principal and income of the fund;                                                                                 
07                 (4)  provide reports to the board established under AS 37.14.120 on the                                 
08       condition and investment performance of the fund;                                                             
09                 (5)  determine, on July 1 of each year, the monthly average market                                  
10       value of the fund for the previous 10 fiscal years.                                                           
11    * Sec. 3. AS 37.14 is amended by adding a new section to read:                                                     
12 Sec. 37.14.165. Use of the public school trust fund. Each year, the legislature                                       
13 may appropriate 4.75 percent of the amount determined by the commissioner of                                            
14       revenue under AS 37.14.160(5) for the following purposes:                                                         
15                 (1)  funding support of the state public school program; and                                            
16                 (2)  reimbursement of the costs of administration of the fund.                                          
17    * Sec. 4. AS 37.14.170 is amended to read:                                                                         
18 Sec. 37.14.170. Investments. The commissioner of revenue is the fiduciary of                                          
19 the trust fund and shall invest the fund to provide increasing returns from capital                                 
20 appreciation and net income over long-term periods to the fund's current                                        
21 [INCOME] beneficiaries. The commissioner may invest the money in the fund on the                                        
22 basis of probable total rate of return to promote the long-term generation of capital                               
23       appreciation and income. In managing the trust fund, the commissioner shall                                   
24 (1)  consider the status of the fund's capital and the income generated                                                 
25       on both a current and a probable future basis;                                                                    
26                 (2)  determine the appropriate investment objectives;                                                   
27                 (3)  establish investment policies to achieve the objectives; and                                       
28 (4)  act only in regard to the financial interests of the fund's                                                        
29       beneficiaries.                                                                                                    
30    * Sec. 5. AS 37.14.140 is repealed.