January-February 2023 Committee on School Finance/Permanent School Fund
THURSDAY
February 2, 2023
10:00 a.m. or upon adjournment of the PSF Corporation Meeting
COMMITTEE ON SCHOOL FINANCE/PERMANENT SCHOOL FUND – Room 1-104
Members: Keven Ellis; Patricia Hardy; Tom Maynard; Marisa Perez-Diaz; Staci Childs. 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.
State Board of Education (SBOE) operating rules call for each committee to elect a chair from among its members. This item provides an opportunity the Committee on School Finance/Permanent School Fund to elect a chair at this meeting if the SBOE retains the existing committee structure. The chair may then appoint a vice chair. If the board changes the committee structure, the committee may elect a member to preside over this first meeting only. Statutory authority is the Texas Education Code, §7.107(b).
COMMITTEE – ACTION
SBOE – NO ACTION
2. Proposed Repeal of 19 TAC Chapter 129, Student Attendance, Subchapter A, Student Attendance Allowed, and Subchapter B, Student Attendance Accounting
(Second Reading and Final Adoption)
This item presents for second reading and final adoption 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. No changes are recommended since approved for first reading. 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 – ACTION
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 September and October 2022. Statutory authority is the Texas Constitution, Article VII, §2 and §5 and 19 Texas Administrative Code (TAC) Chapter 33.
COMMITTEE - ACTION
SBOE - CONSENT
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 September and October 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. Annual Reporting of the Internally-Managed Permanent School Fund Investment Portfolio
This item provides an opportunity for the executive administrator and chief investment officer of the Permanent School Fund to report on various items required by 19 TAC Chapter 33, Statement of Investment Objectives, Policies, and Guidelines 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
6. Proposed Revisions to 19 TAC Chapter 33, Statement of Investment Objectives, Policies, and Guidelines of the Texas Permanent School Fund
(Second Reading and Final Adoption)
This item presents for second reading and final adoption 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. Changes are recommended since approved for first reading. Statutory authority is the Texas Constitution, Article VII, §5(a) and (f); Texas Education Code (TEC), §43.001 and §43.0031; and SB 1232, 87th Texas Legislature, Regular Session, 2021.
COMMITTEE - ACTION
SBOE - CONSENT
7. Review of the Bond Guarantee Program Reserve
This item provides an opportunity for the committee and board to review and consider an increase to the Bond Guarantee Program reserve. Statutory authority is the Texas Constitution, Article VII, §2 and §5, and Texas Education Code (TEC), §45.053(c).
COMMITTEE - ACTION
SBOE - CONSENT
8. 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, §5 and §2, and 19 Texas Administrative Code (TAC) Chapter 33.
COMMITTEE – DISCUSSION
SBOE – NO ACTION