January 2014 Committee on School Finance Permanent School Fund Item 5

Ratification of the Purchases and Sales of the Investment Portfolio of the Permanent School Fund for the Months of October and November 2013

January 31, 2014

COMMITTEE ON SCHOOL FINANCE/PERMANENT SCHOOL FUND: ACTION
STATE BOARD OF EDUCATION: CONSENT

SUMMARY:
This item provides an opportunity for the committee and board to consider approval of the purchases and sales of securities executed in the portfolio of the Permanent School Fund for the months of October and November 2013.

STATUTORY AUTHORITY: Texas Constitution, Article VII, §5(f).

PREVIOUS BOARD ACTION: At the November 2013 meeting, the board approved purchases in the amount of $1,162,479,031 and sales in the amount of $1,111,582,786 conducted in the investment portfolio of the Permanent School Fund for the months of August and September 2013.

BACKGROUND INFORMATION AND SIGNIFICANT ISSUES: The purchases and sales of the investment portfolio are reviewed by the staff to ensure compliance with the Investment Guidelines, Policies and Objectives of the Permanent School Fund. The specific amounts of the purchases and sales for the reporting period will be recommended to the board for ratification upon approval by the Committee on School Finance/Permanent School Fund.

FISCAL IMPACT: The distribution of the Permanent School Fund is projected to be $1.675 billion during the 2014-2015 biennium.

PUBLIC AND STUDENT BENEFIT: The distribution of the Permanent School Fund will flow to the school districts and reduce the tax burden to the public and the state of Texas.

PROCEDURAL AND REPORTING IMPLICATIONS: Not applicable.

PUBLIC COMMENTS: None.

ALTERNATIVES: No alternative actions are proposed regarding this item.

OTHER COMMENTS AND RELATED ISSUES: The purchases and sales are provided under separate cover. The State Board of Education has adopted Investment Guidelines, Policies and Objectives, which establish the criteria for the purchase of the investments to the portfolio.

Staff Member Responsible:
Holland Timmins, Executive Administrator
and Chief Investment Officer of the
Texas Permanent School Fund