Alabama Trust Fund

Country: United States

Established: 1986

US$ Billion: 3.1

Origin: Natural Gas

Entity Structure: Fund

Transparency Rating: 6

The Alabama Trust Fund was developed by public referendum in 1985 from finding natural gas deposits. At first a permanent fund, it is now a special revenue fund which allows for the spending of principal equal to the previous year's unrealized gains. The fund is paid by royalty payments from oil & gas firms; 1% of these payments goes to the Department of Conservation Land Division (State of Alabama) and the rest goes to the Alabama Trust Fund.

Strategies and Objectives:
The fund is managed by external managers chosen by the Board of Trustees. 68% is invested in fixed income while 32% is invested in equities.

News and Updates

Alabama legislators: Tap trust fund savings to build roads, rescue prepaid tuition plan
According to sources, "Some lawmakers are pushing for plans that could take money from a multi-billion dollar state savings account to pay for a $1 billion road-building program and a $300 million rescue of the state's prepaid college tuition plan. The legislators want to take money from the Alabama Trust Fund because other possible money sources, such as the state's Education Trust Fund and General Fund, are struggling with falling revenues."
read more: The Birmingham News

Some fund purposes might be used to plug budget holes
According to Forbes, "Former Governor Fob James, who started Alabama's $3.4 billion trust fund with revenue from offshore natural gas leases, plans to vote against Amendment One in the election Nov. 4 because he feels it breaks a commitment to protect the public's savings. The amendment would allow state officials to use as much as $625 million — or about one-fifth of the trust fund — to plug budget holes. But the money would have to be repaid in future years."
read more: The Associated Press


Alabama State Treasurer

1. All figures quoted are from official sources, or, where the institutions concerned do not issue statistics of their holdings, from other publicly available sources.

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