Not to be confused with the Alaska Permanent Fund, the Kenai Municipal Airport has a permanent fund of its own.
Like its much bigger brother, the airport fund seeks to make money on its principal base through sound investing.
On Wednesday, just before the regular meeting of the Kenai City Council, members will gather for a special work session to learn what better options are out there for increasing the airport fund's return on investment.
Alaska Permanent Capital Management, a private money management firm based in Anchorage, will address the council on ways to improve its investing from its roughly $13 million base.
As recommended by airport consultants hired to look at the airport's long-range plan, the airport is seeking a change in its investment policy, according to Kenai Finance Manager Larry Semmens.
"The recommendation will be to develop an asset allocation that includes stocks," Semmens said Monday.
Until now, the fund has followed a more conservative approach, investing only in bonds.
As the name implies, monies in the airport's permanent fund cannot be spent, "so it's better to think long-term," Semmens said.
Earnings from the fund can be spent, and Semmens said he is interested in doing so to enhance the ability of the airport to fund its operations.
"Right now there's a huge variance in the interest rates (the airport fund is earning)," Semmens said. "This will stabilize earnings due to the percent of market value approach."
Beyond that, he said earnings will increase by adding equities to the investment mix.
The work session is slated for 6 p.m. Wednesday, followed by the regular city council meeting at 7.
Phil Hermanek can be reached at phillip.hermanek@peninsulaclarion.com.
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