April 2021 Committee on School Finance/Permanent School Fund Item 11

Review of the Core Fixed Income Asset Class for the Permanent School Fund

April 15, 2021

COMMITTEE ON SCHOOL FINANCE/PERMANENT SCHOOL FUND: DISCUSSION
STATE BOARD OF EDUCATION: NO ACTION

SUMMARY: This item provides an opportunity for the committee to review the core fixed income asset class of the Permanent School Fund (PSF).

STATUTORY AUTHORITY:  Texas Constitution, Article VII, §2 and §5; 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 PSF 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 June 2020 meeting, the board approved the PSF Long-Term Strategic Asset Allocation Plan with an allocation of 12% to the core fixed income return asset class.

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