List of U.S. states by sovereign wealth funds

Template:Infobox U.S. state sovereign wealth funds The List of U.S. states by sovereign wealth funds provides an overview of the sovereign wealth funds (SWFs) that are owned by individual states within the United States. A sovereign wealth fund is a state-owned investment fund comprised of money generated by the government, often derived from surplus revenues from natural resources, trade surpluses, fiscal surpluses, and/or receipts from privatizations. These funds invest in a variety of assets such as stocks, bonds, real estate, precious metals, and other financial instruments, primarily aimed at stabilizing the economy and generating wealth for future generations.

Overview

Sovereign wealth funds in the U.S. are primarily funded by revenues from natural resources. For example, oil and gas revenues play a significant role in the SWFs of states like Alaska and Texas. These funds are designed to manage and allocate excess profits to achieve long-term economic benefits.

List of States with Sovereign Wealth Funds

Alaska

• Alaska Permanent Fund - Established in 1976, it is funded by oil revenues and is designed to give a portion of the profits directly back to state residents in the form of an annual dividend.

Texas

• Texas Permanent School Fund - This fund was created in 1854 to support public education in the state. It is funded through oil, gas, and land revenues.
• Texas Permanent University Fund - Established in 1876, this fund benefits public higher education in Texas, supporting institutions within the University of Texas System and Texas A&M University System.

New Mexico

• New Mexico State Investment Council - Manages several funds derived from oil, gas, and minerals, including the Severance Tax Permanent Fund and the Land Grant Permanent Fund, aimed at supporting education and other public initiatives.

Wyoming

• Wyoming Permanent Mineral Trust Fund - Created in 1974, it is funded by severance taxes on extracted minerals, primarily coal, oil, and natural gas.

Impact and Significance

Sovereign wealth funds play a crucial role in the economies of the states that operate them. By investing excess revenues, these funds help to stabilize state economies during volatile economic periods and provide funding for public projects and services. Additionally, they can generate significant financial returns, contributing to state budgets and reducing the tax burden on residents.

Challenges

Managing a sovereign wealth fund involves significant challenges, including investment risks, political pressures, and the need for transparent and effective governance. The performance of these funds is closely tied to global economic conditions, and they require sophisticated management strategies to mitigate risks and maximize returns.

See Also

• Economy of the United States
• Public finance
• Investment management