Alaska Treasury reports $4.5 billion gains in 2024; multiple state funds post strong returns

Juneau — Department of Revenue officials reported to the House Finance Committee on Jan. 31 that Alaska Treasury produced an aggregate 9.1% return across the funds it manages in 2024, generating roughly $4.5 billion in total gains.

The Treasury presentation, led by Treasury Division Director Pam Leary and Chief Investment Officer Zach Hanna, said strong performance across both public and private markets produced outsized results for several state portfolios. “Managing $50,000,000,000 in numerous investment funds and tracking cash flows is as complex as it sounds,” Leary said while describing the Treasury’s operations. Officials said the Treasury’s internal investment program contributed materially to the results.

Why it matters: Higher investment returns reduce the near‑term pressure on state budgets and the need for larger legislative appropriations to cover recurring payments, including retirement liabilities and education funding. Committee members pressed Treasury staff on how the gains affect reserves and long‑term obligations.

Key figures and fund results - Aggregate return: Treasury reported a 9.1% return across all managed portfolios in 2024, producing about $4.5 billion in gains for the year. - Asset‑class contribution: Officials said asset classes ranged from about 5% for cash equivalents to 24% for U.S. equities in 2024; those class returns formed the backdrop for fund performance. - Constitutional Budget Reserve Fund (CBRF): Treasury reported the CBRF’s one‑year return and related activity added approximately $150 million in gains for 2024. The invested balance for the CBRF was reported at about $2.7 billion on June 30, 2024. - Jafanzi (general fund pooled accounts): Combined Jafanzi 1 and Jafanzi 2 earned roughly $180 million in 2024; Jafanzi pools held about $3.7 billion at the end of the fiscal year. - Alaska Higher Education Investment Fund: Reported one‑year performance around 11.4%, producing about $44 million in gains; the committee was told roughly $11 million was appropriated from the fund last year (committee member estimate). - Public School Trust Fund: Ended fiscal 2024 at about $834 million and contributed $32 million to the public education fund for FY24; Treasury reported a one‑year return near 11.4% and a 10‑year annualized return around 7%. - Retirement systems: Combined public employee and teachers’ defined benefit plans held about $31 billion at June 30, 2024 and produced about a 9.2% return for fiscal 2024.

Internal management and costs Treasury officials emphasized internal management and lower fees: Hanna said the Treasury and the Alaska Retirement Management Board’s approach delivered excess returns over benchmarks and lower costs versus peers. Treasury estimated roughly $130 million of value added above benchmarks in internally managed portfolios and said ARM’s low‑cost approach saved system stakeholders roughly $30 million per year compared with median peers.

Quotes from staff - Pam Leary: “Managing $50,000,000,000 in numerous investment funds and tracking cash flows is as complex as it sounds.” - Zach Hanna: Treasury said internal management and active asset allocation produced excess returns and that the board’s low‑cost approach helped drive stronger long‑term performance.

What the committee asked Committee members questioned staff about whether the recent returns are durable and how Treasury’s allocations will change as interest rates normalize. Hanna said Treasury has intentionally kept some traditionally longer‑duration allocations reduced in recent years and may modestly add risk as market conditions change.

Bottom line Treasury officials told the committee 2024 was one of the stronger recent years for state portfolios, with broad gains across short‑ and long‑horizon funds. Officials said excess returns and lower fees helped shore up fund values, while noting allocations and liquidity remain tuned to each fund’s spending horizon and constraints.

The committee followed with further hearings on reserves, cash flow and retirement system liquidity later in the same session.