Since taking over as State Treasurer in 2000, Ive been talking about how the Louisiana Education Quality Trust Fund (LEQTF) is one of the biggest success stories in state government. As we finalized our fiscal year 2003-2004 LEQTF Annual Report, I discovered even more reasons why this is true.

Background

The LEQTF, which is also known as the 8(g) fund, began in 1986 when the state took $541 million from a settlement with the federal government over oil and gas revenues and put it into trust. The state divides a portion of the LEQTF’s earnings each year between the Board of Elementary and Secondary Education (BESE) and the Board of Regents (Regents) with the priority of promoting research and education. As Treasurer, I am the administrator of the Trust and am responsible for prudently investing the funds.

Disbursements and Earnings

Since the inception of the LEQTF, the State Treasury has distributed $959 million in investment and royalty earnings to BESE and Regents. At the same time, we have increased the market value of the trust fund to more than $1 billion. This past fiscal year, the LEQTF provided $64.7 million to these two groups to finance various projects.

Investments

The Treasury invests the LEQTF to preserve its capital, enhance its market value, and generate a steady flow of income for both Regents and BESE. Stocks and bonds are the two investment vehicles available to accomplish these tasks. Diversified investments in the LEQTF safeguard the funds assets and moderate its volatility. This past fiscal year, the LEQTF had a total rate of return of 7.1 percent. The LEQTF market value, which is the amount a seller could expect to obtain for securities sold in the open market, grew more than $52 million during the fiscal year to more than $1 billion.

LEQTF Annual Report

I invite you to learn more about the LEQTF by reading through our annual report, which is available online at www.latreasury.com. This year, we specifically highlighted BESE’s role in expanding and improving early childhood education. I’m extremely proud that some of the earnings of the LEQTF are going toward this important cause.

Early childhood education is critical to the development and growth of every Louisiana child. It truly is one of the most fundamental building blocks in a child’s life. The use of LEQTF dollars for PreK programs, in particular, is clearly an investment in the future of Louisiana one that creates success all the way to the university level and beyond.

Outstanding investments, coupled with student and faculty achievement, make the LEQTF a unique and permanent funding source for our children’s future. Please visit our website at www.latreasury.comto learn about this remarkable resource for education.