Senate Bill 461 originally called for establishment of a Future Fund to pool 25 percent of oil and gas severance tax revenue in excess of US$ 175 million. With revenues forecasted to hit US$ 176 million in fiscal year 2015-2016, state legislators chose the US$ 175 million benchmark to allow the government more oil and gas proceeds to aid in balancing the state budget. The bill, proposed by WV Senate president Jeff Kessler (D), reached the floor of the state House of Delegates after passing the House Judiciary Committee on March 3rd and the House Finance Committee on March 5th.
It now goes to the Governor Earl Ray Tomblin to sign.
The House Finance Committee axed the US$ 175 million milestone, calling instead for the future fund to reap 3 percent of all gas, oil, coal, sandstone and limestone severance tax revenues which would have been deposited in the state’s general fund. Moreover, the committee amended the bill to freeze funding of the investment pool during times of financial stress if the state needs additional funds or has to slash spending. Finally, it capped the amount lawmakers can draw from the fund in a given year at the average interest income of the preceding five budget cycles.
A proposed constitutional amendment accompanies the bill, barring legislators from tapping the fund until 2020 and setting limits on where interest and investment income can be spent. If this joint resolution is passed by voters in November, spending of fund interest and income will be restricted to five general areas:
- Workforce development and education enhancement
- Infrastructure projects
- Economic development and diversification
- Tax relief measures for state citizens and businesses
- Cultural and historical improvements/preservation
Passes in WV House and Senate
The House of Delegates amended Senate Bill 46. Both the Senate and House have approved the changes to the Future Fund bill. It now goes to the Governor Earl Ray Tomblin to sign.
Banking behemoth J.P. Morgan Chase disclosed its own digital currency called JPM Coin. The digital token will be used to settle payments between clients. JPM Coin will be backed by physical U.S. dollars and be based off Quorum. Quorum is J.P. Morgan’s private Ethereum-based chain. JPM Coin plans to compete with Ripple, which created XRP, another digital currency that is used for settlements. Ripple’s main target market is cross-border payments and remittances.
The Central Bank of the United Arab Emirates and the Saudi Arabian Monetary Authority have unveiled their plans for Aber, an interbank digital currency. Both banks have indicated that Aber will be limited to financial settlements using distributed ledger technologies. It will be rolled out on a probational basis, and used by select banks within the two countries. A date for rollout has not yet been declared. A joint statement hinted at a broader application of the currency in the days ahead. If “no technical obstacles are encountered, economic and legal requirements for future uses will be considered.” Blockchains and Distributed Ledgers technologies will be employed. The plan is for ‘Proof-of-Concept’ testing, which involves studying and fully comprehending the ways modern technologies can achieve practical applications. The digital currency has the potential to become a reserve system for central payments.
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La Française and Canada Pension Plan Investment Board (CPPIB) formed a strategic partnership for the launch of a real estate investment and development vehicle: Société Foncière et Immobilière du Grand Paris. The joint venture between CPPIB (80%) and Caisse Fédérale du Crédit Mutuel Nord Europe (CMNE) (20%), La Française’s shareholder, will invest in major real estate projects linked to the Grand Paris infrastructure in the Greater Paris area. The parties will initially allocate €387.5 million in equity to the venture. The partnership will target regeneration and infrastructure-led investments.[ Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view content. ]
Øystein Olsen, the Governor of Norges Bank, which oversees the Norway Government Pension Fund Global (GPFG), voiced his opinion on the Norwegian government’s plans to alter the rules that regulates the country’s SWF withdrawal rules in certain circumstances. The coalition government led by Norwegian Prime Minister Erna Solberg wants to relax the limits on SWF withdrawals in specific cases. Norway’s government seeks to raid the fund to pay for the replacement of four major state buildings impacted by a terrorist attack and a crashed Royal Norwegian Navy frigate (KNM Helge Ingstad).
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