SB 98: "An Act relating to the power cost equalization endowment fund; and relating to the Alaska Permanent Fund Corporation."
00 SENATE BILL NO. 98 01 "An Act relating to the power cost equalization endowment fund; and relating to the 02 Alaska Permanent Fund Corporation." 03 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 04 * Section 1. AS 37.13 is amended by adding a new section to article 2 to read: 05 Sec. 37.13.310. Corporation to manage the power cost equalization 06 endowment fund. (a) The corporation shall manage the power cost equalization 07 endowment fund. 08 (b) The corporation shall 09 (1) manage the power cost equalization endowment fund as provided 10 under AS 42.45.080; 11 (2) at least quarterly, prepare, publish, and distribute to the legislature 12 a financial report showing investment revenue and expenditures, including the 13 allocation of the cash assets of the power cost equalization endowment fund among 14 investments; the corporation shall deliver the report to the senate secretary and the
01 chief clerk of the house of representatives and notify the legislature that the report is 02 available; and 03 (3) annually prepare, publish, and distribute to the legislature financial 04 statements prepared in accordance with generally accepted accounting principles 05 consistently applied, and an audit report prepared by a certified public accountant; the 06 corporation shall deliver the report to the senate secretary and the chief clerk of the 07 house of representatives and notify the legislature that the report is available. 08 (c) Net income from the power cost equalization endowment fund may not be 09 included in the computation of net income or market value available for distribution or 10 appropriation under AS 37.13.140. 11 * Sec. 2. AS 42.45.070(a) is amended to read: 12 (a) The power cost equalization endowment fund is established as a separate 13 fund of the corporation [AUTHORITY]. The fund consists of 14 (1) legislative appropriations to the fund that are not designated for 15 annual expenditure for the purpose of power cost equalization; 16 (2) accumulated earnings of the fund; 17 (3) gifts, bequests, contributions of money and other assets, and federal 18 money given to the fund that are not designated for annual expenditure for power cost 19 equalization; and 20 (4) [REPEALED] 21 * Sec. 3. AS 42.45.080 is amended to read: 22 Sec. 42.45.080. Powers and duties of the corporation [COMMISSIONER 23 OF REVENUE]. (a) The power cost equalization endowment fund shall be 24 managed by the corporation under AS 37.13.310. The corporation 25 [COMMISSIONER OF REVENUE] is the fiduciary of the fund. In managing the 26 fund, the corporation [COMMISSIONER] shall 27 (1) have the same powers and duties as are provided in AS 37.10.071; 28 and 29 (2) hold and invest the fund subject to AS 37.13.120 [APPLY THE 30 PRUDENT-INVESTOR RULE WHEN INVESTING THE FUND; THE 31 "PRUDENT-INVESTOR RULE" AS APPLIED TO INVESTMENT ACTIVITY OF
01 THE FUND MEANS EXERCISING THE JUDGMENT AND CARE UNDER THE 02 CIRCUMSTANCES THEN PREVAILING THAT AN INSTITUTIONAL 03 INVESTOR OF ORDINARY PRUDENCE, DISCRETION, AND INTELLIGENCE 04 EXERCISES IN THE DESIGNATION AND MANAGEMENT OF LARGE 05 INVESTMENTS ENTRUSTED TO IT, NOT IN REGARD TO SPECULATION, 06 BUT IN REGARD TO THE PERMANENT DISPOSITION OF FUNDS, 07 CONSIDERING PRESERVATION OF THE PURCHASING POWER OF THE 08 FUND OVER TIME WHILE MAXIMIZING THE EXPECTED TOTAL RETURN 09 FROM BOTH INCOME AND THE APPRECIATION OF CAPITAL]. 10 (b) In managing the fund, the corporation [COMMISSIONER] shall 11 (1) consider the status of the fund's capital and the income generated 12 on both current and probable future bases; 13 (2) determine the appropriate investment objectives; 14 (3) establish investment policies to achieve the objectives; and 15 (4) act only in regard to the best financial interests of the fund. 16 (c) On July 1 of each year, the corporation [COMMISSIONER] shall 17 determine 18 (1) the monthly average market value of the fund for the previous three 19 closed fiscal years; and 20 (2) the earnings of the fund for the previous closed fiscal year. 21 * Sec. 4. AS 42.45.085(a) is amended to read: 22 (a) Five percent of the amount determined by the corporation 23 [COMMISSIONER OF REVENUE] on July 1 of each year under AS 42.45.080(c)(1) 24 may be appropriated for the following purposes: 25 (1) funding the power cost equalization and rural electric capitalization 26 fund (AS 42.45.100); 27 (2) reimbursement to the corporation [DEPARTMENT OF 28 REVENUE] for the costs of establishing and managing the fund; and 29 (3) reimbursement of other costs of administration of the fund. 30 * Sec. 5. AS 42.45.099 is amended to read: 31 Sec. 42.45.099. Definitions [DEFINITION]. In AS 42.45.070 - 42.45.099,
01 (1) "corporation" means the Alaska Permanent Fund Corporation 02 established in AS 37.13.040; 03 (2) "fund" means the power cost equalization endowment fund 04 established in AS 42.45.070.