November 2021 Committee on School Finance/Permanent School Fund

THURSDAY
November 18, 2021

9:00 a.m.

COMMITTEE ON SCHOOL FINANCE/PERMANENT SCHOOL FUND – Room 1-104

Members: Tom Maynard, chair; Lawrence A. Allen, Jr., vice chair; Keven Ellis; Patricia Hardy; Marisa Perez-Diaz. A quorum of the State Board of Education may attend the committee meeting and discuss items on the committee agenda. A quorum of the Committee of Investment Advisors to the Permanent School Fund may attend the committee meeting and discuss items on the committee agenda.

Public testimony – Individual testimony will be taken at the time the related item comes up for committee discussion or action. The procedures for registering and taking public testimony at State Board of Education committee meetings and general board meetings are provided online.

1. Approval of Costs to Administer the 2021–2022 State-Developed Assessments to Private School Students

Texas Education Code, §39.033, allows a private school to voluntarily assess its students with the State of Texas Assessments of Academic Readiness (STAAR) and the Texas English Language Proficiency Assessment System (TELPAS) assessments The State Board of Education must approve the per-student cost to private schools, which may not exceed the cost of administering the same assessment to a student enrolled in a public-school district. This item requests approval of these costs for the 2021–2022 school year. Statutory authority is the Texas Education Code (TEC), §39.033.

COMMITTEE – ACTION
SBOE – CONSENT

2. Review of Permanent School Fund Securities Transactions and the Investment Portfolio

Investment staff will report on the transactions executed during the months of July, August, and September 2021 in the investment portfolio of the Texas Permanent School Fund. Statutory authority is the Texas Constitution, Article VII, §2 and §5; and 19 Texas Administrative Code (TAC), Chapter 33.

COMMITTEE – DISCUSSION
SBOE – NO ACTION

3. Ratification of the Purchases and Sales of the Investment Portfolio of the Permanent School Fund for the Months of July, August, and September 2021

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 July, August, and September 2021. Statutory authority is the Texas Constitution, Article VII, §2 and §5; and 19 Texas Administrative Code (TAC), Chapter 33.

COMMITTEE – ACTION
SBOE – CONSENT

4. Report on Permanent School Fund Liquid Account and Ratification of Purchases and Sales for the Months of July, August, and September 2021

This item provides an opportunity for the committee and board to receive a status update report on the liquid account and consider approval of the purchases and sales of investments executed in the liquid account for the months of July, August, and September 2021. Statutory authority is the Texas Constitution, Article VII, §2 and §5; Texas Natural Resources Code (NRC), §51.414, as repealed by SB 1232, 87th Legislature, Regular Session, 2021; and 19 Texas Administrative Code (TAC) Chapter 33.

COMMITTEE – ACTION
SBOE – CONSENT

5. Review of the Permanent School Fund Liquid Account Strategic Asset Allocation

This item provides an opportunity for the committee and board to review the Permanent School Fund liquid account strategic asset allocation. Statutory authority is the Texas Constitution, Article VII, §2 and §5; Texas Natural Resources Code (NRC), §51.414, as repealed by SB 1232, 87th Legislature, Regular Session, 2021; and 19 Texas Administrative Code (TAC) Chapter 33.

COMMITTEE – ACTION
SBOE – CONSENT

6. Overview of the Permanent School Fund Investment Portfolio

This item provides an opportunity for the committee to receive an overview of the Permanent School Fund investment portfolio. Statutory authority is the Texas Constitution, Article VII, §5 and §2; and 19 Texas Administrative Code (TAC), Chapter 33.

COMMITTEE – ACTION
SBOE – CONSENT

7. Review of the Absolute Return Asset Class for the Permanent School Fund

This item provides an opportunity for the committee and board to review the absolute return asset class. Statutory authority is the Texas Constitution, Article VII, §5 and §2; and 19 Texas Administrative Code (TAC), Chapter 33.

COMMITTEE – ACTION
SBOE – CONSENT

8. Proposed New 19 TAC Chapter 33, Statement of Investment Objectives, Policies, and Guidelines of the Texas Permanent School Fund, Subchapter A, State Board of Education Rules, §33.21, Texas Permanent School Fund Corporation
(First Reading and Filing Authorization)


This item presents for first reading and filing authorization proposed new 19 Texas Administrative Code (TAC) Chapter 33, Statement of Investment Objectives, Policies, and Guidelines of the Texas Permanent School Fund, Subchapter A, State Board of Education Rules, §33.21, Texas Permanent School Fund Corporation. The proposed new section would address the term length of State Board of Education (SBOE) members on the board of directors of the Texas Permanent School Fund (PSF) Corporation as required by Senate Bill (SB) 1232, 87th Texas Legislature, Regular Session, 2021. Statutory authority is the Texas Constitution, Article VII, §5(a) and (f), and Texas Education Code (TEC), §43.001 and §43.053, as added by SB 1232, 87th Legislature, Regular Session, 2021.

COMMITTEE – ACTION
SBOE – CONSENT

9. Report of the Permanent School Fund Executive Administrator and Chief Investment Officer

The Permanent School Fund executive administrator will report to the committee on matters relating to the management of the Permanent School Fund and the Charter District Reserve Fund. The report may present information on historical and current status of Fund holdings, current and proposed investment and operational policies and procedures, and historical and current Fund performance and compliance. The administrator may update the board on the bond guarantee program, the status of requests for proposal or for qualifications and current contracts for services and other administrative activities undertaken on behalf of the board. The administrator may provide an update on the PSF distribution or on the effect of legislation impacting the PSF. The administrator may provide an analysis of current and future investment market conditions, focusing upon the impact on the holdings of the Permanent School Fund. Statutory authority is the Texas Constitution, Article VII, §2 and §5; and 19 Texas Administrative Code (TAC), Chapter 33.

COMMITTEE – DISCUSSION
SBOE – NO ACTION