The Kenai airport is sitting pretty, at least financially. City Manager Rick Koch said the airport’s permanent fund has built from $17million in 2008 to $22million now, thanks to wise investing…
Koch: “It’s a fairly tried and true investment philosophy, very similar to the Alaska Permanent Fund, sometimes it’s called percent of market value. It is a fairly aggressive investment philosophy. It’s about 65 percent invested in equities, the rest in fixed assets. It’s calculated rate of return is somewhere between 6.5 and 7 percent and we’ve done better than that every year. We’ve found ourselves in a market that we’ve done very well on the equities side, and over time there’ll be good years and bad years, but on the front end, it’s been very good for us.”
Koch said the fund has also paid out close to $4.3 million for operations since 2008, resulting in an overall increase of over $9million.
Koch: “there was a period of time for almost a decade where it did lose money every year, as much as $800,000. But over the course of the last seven years, we’ve turned that around. We changed that investment philosophy, which was a big part of it. We went from earning $100,000 a year to earning several million dollars a year. We’ve restructured the rates and fees there, and we’re running it much more like a business.”
Larry Semmens was noted as instrumental in the selection of current investing strategies.