Secretary, DOA
__________________
DATE: February 12, 1997
TO: Charles R. Sanders
Assembly Chief Clerk
FROM: State Employment Options Program
Department of Employment Relations
RE: 1996 SEO Annual Report
Please find enclosed the 1996 State Employment Options (SEO) Annual Report.
Please share any questions or concerns you may have with the Department of Employment Relations Executive Assistant, Ray Allen, at 608/266-5316.
__________________
State of Wisconsin
Investment Board
Madison
February 12, 1997
To the Honorable, the Legislature:
Section
25.17(14r) of the Statutes, as created by
1995 Wisconsin Act 274, requires that the State of Wisconsin Investment Board (SWIB) submit a report to the Joint Committee on Audit, Joint Committee on Finance, and Chief Clerks of each House summarizing any change in the Board's investment policies, upon adoption of the change.
In
1995 Wisconsin Act 403, the Legislature established a college tuition prepayment program which has been named "EdVest Wisconsin." The Department of Administration (DOA) was given responsibility to establish and operate the program. SWIB was given the responsibility to invest assets of the trust fund which will receive revenues from the sale of tuition units.
Act 403 directs that SWIB invest the assets of the trust fund in "investments with maturities and liquidity that are appropriate for the needs of the fund." SWIB will receive a quarterly report from DOA projecting future cashflow needs. An actuary has been retained by DOA to assist in this process.
A69
On February 7, 1997, the Board of Trustees adopted investment guidelines for the trust fund. The assets of the fund will be managed in a structured, fixed income portfolio matched to program liabilities. The guidelines adopted by the Board permit investment in U.S. Treasury and government agency issues, municipal bonds and corporate bonds rated "A" or better. Short-term cash assets of the fund will be managed in the State Investment Fund.
Tuition Trust Fund
Criteria Approved for Investment
The person designated by the Executive Director to manage the Fund may purchase and sell publicly traded fixed income securities, subject to concurrence of the Executive Director or Assistant Executive Director, within the following guidelines:
Quality: Issues rated "A" or better.
Sector: U. S. Treasury and government agencies - No Limit.
Corporate Treasury and government agencies - Overall no limit. Exposure to a particular industry is limited to no more than double that industry's percentage in the M.L. All Corporate Index (COAO).
Municipal treasury and government agencies - Overall No Limit.
Issuer: 5% maximum per corporate or municipal issuer.
These relatively conservative investment guidelines are consistent with the approach discussed with the Legislature when Act 403 was being developed and with preliminary information which DOA has provided to the public about how program funds will be managed.
Please feel free to contact me at 266-9451 if you have any questions about the investment guidelines. Other questions about the program should be directed to Mr. Marty Olle (264-7886), EdVest Wisconsin Program Manager at DOA.
Sincerely,
Patricia Lipton
Executive Director, SWIB
__________________
REFERENCE BUREAU CORRECTIONS
Assembly Joint Resolution 17
1. Page 1, line 2: delete that line.
2. Page 2, line 3: on lines 3 and 7, delete the colon.
Assembly Joint Resolution 19
1. Page 1, line 13: delete the colon.
