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

Review of Senate Bill 1232, 87th Legislature, Regular Session, 2021 and Consideration of Articles of Incorporation for the Permanent School Fund Corporation

September 2, 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 discuss Senate Bill (SB) 1232, 87th Legislature, Regular Session, 2021 and the Articles of Incorporation for the Permanent School Fund (PSF) Corporation.

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.

19 TAC Chapter 33 codifies administrative rules that 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.

FUTURE ACTION EXPECTED: The SBOE is expected to implement SB 1232.

BACKGROUND INFORMATION AND JUSTIFICATION: SB 1232 was passed during the 87th Legislature, Regular Session, 2021. The bill allows the SBOE to create the Texas PSF Corporation (Corporation) and delegate its authority to manage the PSF to the Corporation.

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