Alaska Permanent Fund Corporation

Manager: Robert D. Storer, Executive Director
Tel: (907) 465-2047 Fax: (907) 586-2057

Mission

Maximize the value of Alaska's Permanent Fund through prudent long-term investment and protection of principal to produce income to benefit all generations of Alaskans.

Services Provided:
Produce earnings sufficient to meet dual legislative mandate: inflation-proofing and dividends. Provide accurate investment management and accounting of all Permanent Fund assets, including Science and Technology, Mental Health Trust and International Trade & Business Endowment Fund assets. Distribute quarterly and annual financial reports, informational brochures; and increase public awareness and understanding of Permanent Fund goals and objectives.

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Continue to upgrade the overall investment management capability of the APFC to meet rapidly changing market conditions and financial investment industry demands to that no significant opportunity is lost in meeting the mission of the APFC.

Develop and implement a Board-approved plan to take advantage of the new investment flexibility provided by HB 156, building on the framework of the existing investment program.

Continue to promote legislative adoption of a payout rule based on a percentage of market value (POMV) distribution of Fund income.

Consolidate and keep current all corporate IT resources, systems and capabilities; and maximize their usefulness to APFC staff.

Plan for management turnover as the Chief Investment Officer retires during FY2001 to provide continuity and a smooth and efficient transfer of investment leadership.

Maintain competitive compensation (based on periodic market surveys) to attract and retain qualified staff to meet the investment goals of the Corporation.

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Major Accomplishments
The Permanent Fund produced over $2.5 billion in net income resulting in a Fund valued at $26.5 billion.
The Permanent Fund achieved a real total rate of return of 7.95%, substantially above the 4% target.
Enabling act amended to increase Board of Trustee investment flexibility.
Increased investment diversification by funding of emerging markets mandate and restructuring of equity and real estate portfolios.
Completed Board room modernization to include enhanced videoconferencing capabilities.

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Key Issues
The Corporation's operating budget is program-driven and program-financed. The operating budget is directly proportional to the actual and anticipated growth of the Fund and reflects the Corporation's ability to generate income. The Corporation must invest a small percentage of its annual revenues in its personnel and infrastructure to enable it to generate these future revenues. The Corporation must have the necessary tools readily available to respond to any market situation which may arise.

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Key Performance Measures

Measure: Achieve better-than-average investment performance with a prudent level of risk, maintaining a real rate of return of 4% over time, including at least 4.75% in FY 01.
(Not yet addressed by Legislature.)

Measure: Complete an HB 156 implementation plan and a trustee educational program on alternative investments.
(Not yet addressed by Legislature.)

Measure: Provide Percentage of Market Value (POMV) analysis in legislative, Board and other public venues, using the consultant's model (MOMA) and other tools as appropriate.
(Not yet addressed by Legislature.)

Measure: Upgrade operating systems/software to the current versions and upgrade 1/3 of network, server, workstation, and videoconference equipment.
(Not yet addressed by Legislature.)

Measure: Provide Chief Investment Officer transition plan with a minimum of a four month overlap in employment to transfer investment leadership
from the incumbent to the new replacement.
(Not yet addressed by Legislature.)

Status of FY2000 Performance Measures

FY2000 Performance Measure
Achieved
On Track
Too Soon
to Tell
Not Likely
to Achieve
Needs
Modification

Achieve better-than average investment performance with below-average risk, while maintaining a real rate of return of 4% over time.

Establish departmental workplans that align daily activities with the corporate values of focus, integrity, excellence and professionalism, accountability and commitment.

Ensure that management information systems are available for trading 12 hours/day with a system failure rate of less than 1/month and maximum downtime of 24 hours

Make financial statements and performance reports available 2 weeks after month-end, and produce and distribute print and electronic publications on a timely basis throughout the year.

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Capital Projects

Capital Projects Listed by Department.

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Operating Budget Summaries
Financial Summary

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EBS Home Page /Office of Management and Budget / Webmaster / State of Alaska
Karen_Allen@gov.state.ak.us
(907) 465-4660
December 15, 1999