November 2022 Committee on School Finance/Permanent School Fund

THURSDAY
November 17, 2022

10:00 a.m. or upon adjournment of the PSF Corporation Meeting

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 2022–2023 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 (SBOE) 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 2022–2023 school year. Statutory authority is the Texas Education Code (TEC), §39.033.

COMMITTEE – ACTION
SBOE – CONSENT

2. Proposed Repeal of 19 TAC Chapter 129, Student Attendance, Subchapter A, Student Attendance Allowed, and Subchapter B, Student Attendance Accounting
(First Reading and Filing Authorization)

This item presents for first reading and filing authorization the proposed repeal of 19 Texas Administrative Code (TAC) Chapter 129, Student Attendance, Subchapter A, Student Attendance Allowed, and Subchapter B, Student Attendance Accounting. The proposed repeal would implement House Bill (HB) 3, 86th Texas Legislature, 2019, which removed the State Board of Education's (SBOE's) rulemaking authority related to student attendance. Statutory authority is the Texas Education Code (TEC), §48.004, as transferred, redesignated, and amended by HB 3, 86th Texas Legislature, 2019.

COMMITTEE – ACTION
SBOE – CONSENT

3. Report on Permanent School Fund Securities Transactions and the Investment Portfolio and Ratification of Purchases and Sales for the Months of July and August 2022

This item provides an opportunity for the committee and board to receive a report on Permanent School Fund (PSF) Securities Transactions and the Investment Portfolio and consider ratification of purchases and sales of investments executed in the portfolio of the PSF for the months of May and June 2022. 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 and August 2022

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 and August 2022. 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. Proposed Revisions to 19 TAC Chapter 33, Statement of Investment Objectives, Policies, and Guidelines of the Texas Permanent School Fund
(First Reading and Filing Authorization)

This item presents for first reading and filing authorization proposed revisions to 19 Texas Administrative Code (TAC) Chapter 33, Statement of Investment Objectives, Policies, and Guidelines of the Texas Permanent School Fund. The proposed revisions would implement Senate Bill (SB) 1232, 87th Texas Legislature, Regular Session, 2021, which authorized the creation of the Texas Permanent School Fund (PSF) Corporation. The proposed revisions would repeal 19 TAC §§33.1, 33.5, 33.10, 33.15, 33.20, 33.25, 33.30, 33.35, 33.40, 33.45, 33.50, 33.55, 33.60, 33.65, and 33.67 and propose new §§33.3, 33.4, 33.6, 33.7, and 33.8. The proposed new rules would include changes to the existing rules relating to the Bond Guarantee Program, including changes to the reserve. The proposed revisions would also organize the rules in Chapter 33 by creating new Subchapter B, Texas Permanent School Fund Corporation Rules, which would contain §33.21. Statutory authority is the Texas Constitution, Article VII, §5(a) and (f); Texas Education Code (TEC), §43.001; SB 1232, 87th Texas Legislature, Regular Session, 2021.

COMMITTEE – ACTION
SBOE – CONSENT

6. Approval of the Date to Transfer Management of the Permanent School Fund to the Texas Permanent School Fund Corporation as Contemplated in Senate Bill 1232

This item provides an opportunity for the committee and board to approve the date to transfer management of the Permanent School Fund (PSF) to the Texas PSF Corporation as contemplated in Senate Bill (SB) 1232, 87th Legislature, Regular Session, 2021. Statutory authority is the Texas Education Code §43.052(a) and §43.052(b), Texas Constitution, Article VII, §2 and §5, and 19 Texas Administrative Code (TAC) Chapter 33, SB 1232, 87th Legislature, Regular Session, 2021.

COMMITTEE – ACTION
SBOE – CONSENT

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

The Permanent School Fund (PSF) executive administrator will report to the committee on matters relating to the management of the PSF and the Charter District Reserve Fund.  The report may present information on historical and current status of Fund holdings, current and proposed investment 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 PSF. Statutory authority is the Texas Constitution, Article VII, §2 and §5; and 19 Texas Administrative Code (TAC), Chapter 33.

COMMITTEE – DISCUSSION
SBOE – NO ACTION