45th legislature - STATE OF NEW MEXICO - first session, 2001

REQUESTING THE STATE INVESTMENT COUNCIL TO CONDUCT A STUDY OF THE STATE PERMANENT FUNDS.

WHEREAS, over the course of the last few years, the value of the land grant permanent funds and the severance tax permanent fund have soared to eleven billion dollars ($11,000,000,000), an amount that ranks among the largest endowments in the world; and

WHEREAS, only the state of Texas and Harvard university have larger permanent endowments than New Mexico; and

WHEREAS, the state of New Mexico has numerous pressing needs, including education; and

WHEREAS, with the increased state needs and increased value of the land grant permanent funds and the severance tax permanent fund, there may be opportunities to address many of the state's pressing needs, including education;

NOW, THEREFORE, BE IT RESOLVED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO that the state investment council be requested to conduct a review of the assumptions and methodology underlying the current four and seven-tenths percent distribution formula and an evaluation of that formula in terms of whether it represents the optimal method for maximizing the current distributions to beneficiaries of the funds while protecting the long-term real value of the funds; and

BE IT FURTHER RESOLVED THAT the review also identify distribution options that are used by funds of comparable size and with similar goals and evaluate these other options in terms of whether they provide a distribution policy for the state that is more responsive to economic growth, but still ensures a dependable annual revenue stream for operating purposes; and

BE IT FURTHER RESOLVED that copies of this memorial be transmitted to the state investment officer, the state investment council and the appropriate legislative interim committee chairmen.