Viewing page 9 of 95

This transcription has been completed. Contact us with corrections.

7

the rate of 4 - 1/2% of a running 5-year average market valuation of each fund. These guidelines are considered quite conservative, but the Committee will shortly also consider certain refinements in the way of additional constraints on the use of funds (such as preservation of "historic value" of the funds).

Mr. Burden stated that the Committee strongly recommends that the Board of Regents approve the adoption of the Total Return principle as the investment policy goal for our three investment managers to be effective as of July 1, 1972, and that the Board also approve the extension to the applicable true endowment funds of the same 4-1/2% of 5-year-average-market-value income determination principle now in effect for quasi-endowment funds. A more formal and detailed policy statement on income determination will be reviewed by the Investment Policy Committee and forwarded to the Regents for their review prior to the next Board meeting. 

The following motion was offered, and with the exception of the Chancellor, who did not participate, and Dr. Brown, who abstained it was

VOTED that the Board of Regents approves the adoption of the Total Return principle as the investment goal for our three investment managers to be effective as of July 1, 1972, and that the Board also approves the extension to the applicable true endowment funds of the same 4-1/2% of 5-year-average-market value income determination principle now in effect for quasi-endowment funds.

A press release concerning adoption of the Total Return concept was distributed for approval of the Regents because of its interest to the financial world. Approval of the press release was given (please see the following page).