Alaska State Legislature
News from the House Majority

Jerry Ritter, House Majority Press Secretary
State Capitol
Juneau, AK 99801
Phone: (907) 465-3804
web site: http://www.akrepublicans.org
Actuality line: 1-800-478-6540

House Increases Flexibility of Permanent Fund Investors

Bill Passed to Permit Increased Investment in Stocks

For Immediate Release April 7, 1998 Contact: Rep. Terry Martin at (907) 465-3783.

Juneau -- The Alaska House Tuesday passed House Bill 317, sponsored by the Legislative Budget and Audit Committee. HB 317 increases the Alaska Permanent Fund Board of Trustees' authority to invest in common stocks. The vote was 25-12.

"Virtually all sources on investment theory indicate that equities provide a vastly superior long-term return for investors," said Representative Terry Martin (R-Anchorage), vice-chair of the LB&A Committee. "While there is some increase in short- and intermediate-term volatility in such investments, it is more than compensated for by the long-term gains picture," Martin said.

Currently, the Permanent Fund Board's portfolio is restricted to 50% common stocks, which is smaller than most other large institutional funds. HB 317, which is supported by the Board, would raise that limit to 60%, a limit comparable to other such funds.

"Statistics show that equities perform as much as 46-percent better than bonds over the long-term," Martin said. "By giving the Permanent Fund this increased flexibility, we feel the Board can safely maximize the investment potential of our oil revenue dollars without significantly increasing our long-term risk," Martin said. "That's a good opportunity for Alaskans."

# # #

Broadcasters note: Comments are available by calling the House Majority Actuality Line: (800) 478-6540.
= Terry Martin, 96 K