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account not only this present formula but also other pertinent factors.  For the present fiscal year 1979, furthermore, it is proposed that the payout per unit be maintained at the same level as for FY 1978 rather than declining a further 3.7% as would be required by the present fixed formula.  The background and explanation of reasons for this proposed change are set forth in Attachment B.

In addition the Committee recommends that the Investment Guidelines for the investment managers be modified slightly to reflect this change in payout policy and to expand on investment monitoring procedures.  The proposed revised Guidelines are stated in Attachment C.

The Investment Policy Committee recommendations presented to the Board of Regents were approved and the following resolutions adopted:

VOTED:  that the Board of Regents accepts the recommendation of the Investment Policy Committee that the Total Return Income Payout Policy of the Smithsonian be amended as follows: Prior to the beginning of each fiscal year, the Secretary and the Investment Policy Committee will propose to the Board of Regents, as part of the budget process, a set amount per unit which will be the total return income payout to participating endowment fund units in the succeeding year; this amount will take into account such factors as, but not limited to: (1) 4-1/2% of the five-year adjusted running market averages, (2) current dividend and interest yield, (3) support needs for bureaus and scientists, and (4) inflationary factors as measured by the Consumer's Price Index. For FY 1979, this figure shall be $4.74 per unit, the same amount as in FY 1978,

and further VOTED, that the Board of Regents approves the revised statement of investment objectives recommended by the Investment Policy Committee for the guidance of the investment managers.