November 2019 Committee on School Finance/Permanent School Fund Item 4

Ratification of the Purchases and Sales of the Investment Portfolio of the Permanent School Fund for the Months of August and September 2019

November 15, 2019

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 investments executed in the portfolio of the Permanent School Fund for the months of August and September 2019.

STATUTORY AUTHORITY:  Texas Constitution, Article VII, §2 and §5, and 19 Texas Administrative Code (TAC) Chapter 33.

The Texas Constitution, Article VII, §2 and §5 establish the permanent school fund, the assets that comprise the permanent school fund, the bond guarantee program, the available school fund, and authorize the State Board of Education (SBOE) to manage and invest the permanent school fund in accordance with the prudent person standard.

Administrative rules found in 19 TAC Chapter 33 provide a statement of investment objectives, policies, and guidelines of the Texas Permanent School Fund and Bond Guarantee Program as adopted by the SBOE. 

The full text of statutory citations can be found in the statutory authority section of this agenda.

PREVIOUS BOARD ACTION:  At the September 2019 meeting, the board approved purchases in the amount of $1,687,046,391 and sales in the amount of $1,622,061,401, conducted in the investment portfolio of the Permanent School Fund for the months of May through July 2019.

BACKGROUND INFORMATION AND JUSTIFICATION:  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.

PUBLIC 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.

PUBLIC COMMENTS:  None

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