Inviolate higher education funds.

07LSO-0242.C3

FISCAL NOTE

	FY 2008	FY 2009	FY 2010
NON-ADMINISTRATIVE IMPACT
Anticipated Revenue Increase:
EXCEL. IN HIGHER ED ENDOW	1,608,696	2,501,277	3,528,000

Source of revenue increase: Interest income from Excellence in Higher Education Endowment Fund

Assumptions:

It is assumed that the University of Wyoming and the community colleges return funds previously transferred before June 30, 2007.

It is also assumed the spending policy for FY 2008 is based on what the balance would have been on July 1, 2006 if the Higher Education Endowment Funds had not been disbursed to the University of Wyoming and the community colleges as current legislation requires.

In addition, it is assumed that funds in the Higher Education Endowment Fund are invested in the same manner as the Permanent Wyoming Mineral Trust Fund, which has anticipated yield rates of 3.27% for FY 2008 (on a projected balance of $49,195,609), 3.34% for FY 2009 (on a projected balance of $74,888,533) and 3.36% for FY 2010 (on a projected balance of $105,000,000).

Yield is defined as the actual cash or realized return on investment. Total returns for the permanent funds are expected to be just under 7% over the long-term (10 plus years), while total returns for the non-permanent funds are expected to be just under 5%. Total return is defined as growth in the value of a fund including both yield and unrealized gains.

The 5% spending policy is projected to be $2,459,780 for FY 2008, $3,744,427 for FY 2009, and $5,250,000 for FY 2010. Therefore no transfers to the proposed Excellence in Higher Education Reserve Account are anticipated for FY 2008-10.

Prepared by:   Sharon Garland, Treasurer’s Office    Phone:   777-7475