00 HOUSE BILL NO. 333 01 "An Act relating to an endowment for public education; and providing for an effective 02 date." 03 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 04 * Section 1. AS 14.40.170(a) is amended to read: 05 (a) The Board of Regents shall 06 (1) appoint the president of the university by a majority vote of the 07 whole board, and the president may attend meetings of the board; 08 (2) fix the compensation of the president of the university, all heads of 09 departments, professors, teachers, instructors, and other officers; 10 (3) confer such appropriate degrees as it may determine and prescribe; 11 (4) except as provided under AS 14.40.507, have the care, control, 12 and management of 13 (A) all the real and personal property of the university; and 14 (B) land 01 (i) conveyed to the Board of Regents by the 02 commissioner of natural resources in the settlement of the claim of the 03 University of Alaska to land granted to the state in accordance with the 04 Act of March 4, 1915 (38 Stat. 1214), as amended, and in accordance 05 with the Act of January 21, 1929 (45 Stat. 1091), as amended; and 06 (ii) selected by the University of Alaska and conveyed 07 to it by the commissioner of natural resources under AS 14.40.365; 08 (5) keep a correct and easily understood record of the minutes of every 09 meeting and all acts done by it in pursuance of its duties; 10 (6) under procedures to be established by the commissioner of 11 administration, and in accordance with existing procedures for other state agencies, 12 have the care, control, and management of all money of the university and keep a 13 complete record of all money received and disbursed; 14 (7) adopt reasonable rules for the prudent trust management and the 15 long-term financial benefit to the university of the land of the university; 16 (8) provide public notice of sales, leases, exchanges, and transfers of 17 the land of the university or of interests in land of the university; 18 (9) administer, manage, market, and promote a postsecondary 19 education savings program, including the Alaska Higher Education Savings Trust 20 under AS 14.40.802 and the Alaska advance college tuition savings fund under 21 AS 14.40.803 - 14.40.817. 22 * Sec. 2. AS 14.40.291(a) is amended to read: 23 (a) Notwithstanding any other provision of law, university-grant land, state 24 replacement land that becomes university-grant land on conveyance to the university, 25 land selected by and conveyed to the University of Alaska under AS 14.40.365, land 26 conveyed to the state and the University of Alaska under AS 14.40.507, and any 27 other land owned by the University of Alaska is not and may not be treated as state 28 public domain land. Land conveyed to the University of Alaska under AS 14.40.365 29 shall be managed under AS 14.40.365 - 14.40.368 and policies of the Board of 30 Regents of the University of Alaska. 31 * Sec. 3. AS 14.40 is amended by adding new sections to read: 01 Sec. 14.40.495. Education fund established. (a) The education fund is 02 established as a separate fund of the state. 03 (b) The principal of the fund consists of 04 (1) sums transferred to the fund under AS 14.40.505; and 05 (2) gifts, bequests, and contributions of cash or other assets from a 06 person. 07 (c) The net income of the fund shall be determined by the commissioner of 08 revenue in accordance with investment accounting principles and in a manner that 09 preserves the distinction between principal and income. 10 Sec. 14.40.497. Powers and duties of the commissioner of revenue. The 11 commissioner of revenue is the treasurer of the fund and has the power and duty to 12 (1) act as official custodian of the cash and investments belonging to 13 the fund by securing adequate and safe custodial facilities; 14 (2) receive all items of cash and investments belonging to the fund; 15 (3) collect the principal and income from investments owned or 16 acquired by the fund and deposit the amounts in separate principal and income 17 accounts for the fund; 18 (4) invest and reinvest the assets of the fund as provided in this section 19 and as provided for the investment of funds under AS 37.14.170; 20 (5) exercise the powers of an owner with respect to the assets of the 21 fund; 22 (6) maintain accounting records of the fund in accordance with 23 investment accounting principles and with distinction between the principal and 24 income accounts of the fund; 25 (7) engage an independent firm of certified public accountants to 26 annually audit the financial condition of the fund's investments and investment 27 transactions; 28 (8) enter into and enforce contracts or agreements considered 29 necessary for the investment purposes of the fund; 30 (9) report to the board the condition and investment performance of the 31 fund; and 01 (10) do all acts, whether or not expressly authorized, that the 02 commissioner of revenue considers necessary or proper in administering the assets of 03 the fund. 04 Sec. 14.40.499. Administration of the fund; fund board established. (a) 05 The fund shall be administered by the Education Fund Board. 06 (b) The Education Fund Board is established in the Department of Education 07 and Early Development. The board is composed of 08 (1) the President of the University of Alaska; 09 (2) two members of the Board of Regents of the University of Alaska, 10 selected by the president of the board; 11 (3) two members of the State Board of Education and Early 12 Development, selected by the president of the board; 13 (4) the commissioner of education and early development or the 14 commissioner's designee; and 15 (5) three public members appointed by the governor; in appointing the 16 public members, the governor shall give a preference to persons who have experience 17 and expertise in education. 18 (c) Each public member of the board is appointed for a term of four years, and 19 may be reappointed. 20 (d) Members of the board are entitled to per diem and travel allowances as 21 provided by law for members of state boards and commissions. 22 Sec. 14.40.501. Powers and duties of the board. When acting as 23 administrator of the fund, the board shall 24 (1) hold regular and special meetings it considers necessary; the board 25 may hold meetings by teleconference; 26 (2) keep audio tape recordings of each meeting of the board to be made 27 available on request; and 28 (3) submit to the governor and make available to the legislature by 29 February 1 each year a report describing the annual level of contributions to, income 30 of, and expenses of the fund. 31 Sec. 14.40.503. Uses of fund principal and net income. (a) The principal of 01 the fund shall be retained perpetually in the fund for investment as specified in 02 AS 14.40.497. 03 (b) The net income of the fund may be annually appropriated by the 04 legislature equally for the support of public elementary and secondary education and 05 for support of the University of Alaska. 06 Sec. 14.40.505. Funding from state and university lands. During each 07 fiscal year, the commissioner of revenue shall transfer to the fund created in 08 AS 14.40.495 a sum equal to the total receipts derived from the management of state 09 and University of Alaska land described under AS 14.40.507, including amounts paid 10 to the state as proceeds of sale or annual rent of surface rights, mineral lease rentals, 11 royalties, royalty sale proceeds, and federal mineral revenue-sharing payments or 12 bonuses. 13 Sec. 14.40.507. Joint state and university land endowment. The 14 commissioner of natural resources shall convey to the University of Alaska and the 15 state, as tenants in common, one percent of land conveyed to the state under Sec. 6(b) 16 of the Alaska Statehood Act (P.L. 85-508, 72 Stat. 339). Notwithstanding the transfer 17 of ownership, the rights of management and development of land conveyed under this 18 section shall be retained by the Department of Natural Resources. 19 Sec. 14.40.509. Definitions. In AS 14.40.495 - 14.40.509, 20 (1) "board" means the Education Fund Board; 21 (2) "fund" means the education fund established in AS 14.40.495. 22 * Sec. 4. The uncodified law of the State of Alaska is amended by adding a new section to 23 read: 24 INITIAL TERMS OF PUBLIC MEMBERS. Of the three public members first 25 appointed under AS 14.40.499(a)(5), added by sec. 3 of this Act, 26 (1) one person shall serve a term of two years; 27 (2) one person shall serve a term of three years; and 28 (3) one person shall serve a term of four years. 29 * Sec. 5. This Act takes effect July 1, 2004.