J.D. Williams to lawmakers: Endowment ‘ain’t broke, don’t fix it’
Former state Controller J.D. Williams told lawmakers today, "Every dollar that we can make for these endowment lands and the trust fund is a dollar that does not have to come from taxpayers. The more we make, the more it grows and the less taxes have to be collected." Williams said when he was first elected as state controller and to a seat on the state Land Board, he went to a conference of lands commissioners from other states, and found that some were making 10 times what Idaho was from its endowment lands, and using the money to fund schools and other needs. That concern was part of the driving force behind the endowment reforms initiated in the 1990s and approved by voters as an amendment to the state constitution, Williams said.
"Talk to Gov. Batt about this - endowment reform was led by Gov. Batt, without him it would not have occurred," he said. A major piece of the reform allowed the endowment fund to be invested into higher-earning but riskier investments, such as the stock market, rather than just in low-return bonds; it also allowed the funds and land to be managed together; and called for diversifying the portfolio of land investments, including exchanging away lower-yield land such as cottage sites and grazing land, for higher-yielding land, from timber land to commercial property.
Williams said much of the commercial property that was acquired was in the immediate vicinity of the state capitol. "I thought it made a lot of sense to diversify the portfolio and we would also protect the vicinity of the capitol for further generations," he said, noting that some states have ended up with their state capitols in deteriorated or unsuitable areas. Williams noted that when he was first elected state controller in 1990, the state endowment was worth $320 million. "When I left in 2002 it was worth almost $600 million, almost double in 13 years. Today ... it's worth $1.2 billion. It's doubled again in nine years. As Ronald Reagan said many times ... if it ain't broke, don't fix it. I think they're on the right track."
