SENATE BILL REPORT

SB 6297

BYSenators von Reichbauer, Moore, Kreidler and Johnson; by request of Department of Labor and Industries

Revising investment policies for funds of the department of labor and industries.

Senate Committee on Financial Institutions & Insurance

Senate Hearing Date(s):January 28, 1988

Majority Report:  Do pass.

      Signed by Senators von Reichbauer, Chairman; Johnson, Kreidler, McCaslin, Moore, Rasmussen, Sellar, Smitherman.

Senate Staff:Walt Corneille (786-7416)

                  March 5, 1988

AS PASSED SENATE, FEBRUARY 16, 1988

BACKGROUND:

The State Investment Board was established in 1981 to invest and reinvest public trust and retirement funds.  The board is required to establish investment policies and procedures designed to maximize return with a prudent level of risk.

SUMMARY:

The State Investment Board is required to establish investment policies and procedures with respect to the Department of Labor and Industries' accident, medical aid and reserve funds which are designed to limit fluctuations in industrial insurance premiums.  The policies established by the board, subject to the purposes stated, shall attempt to maximize return at a prudent level of risk.

Appropriation:    none

Revenue:    none

Fiscal Note:      available

Senate Committee - Testified: Joe Dear, L&I; John Hitchman, State Investment Board

HOUSE AMENDMENT:

Everything after the enacting clause is stricken.

Until July 1, 1989, the State Investment Board is required to establish investment policies for industrial insurance funds that are designed to limit fluctuations in industrial insurance premiums and, subject to this limitation, to maximize return at a prudent level of risk.

The board will prepare a report recommending changes in current investment policies.  The report will be presented to the Senate Committee on Economic Development and Labor and the House Committee on Commerce and Labor at the start of the 1989 legislative session.

$100,000 is appropriated to the State Investment Board from the medical aid and accident funds of the industrial insurance funds.