April 2015 Committee on School Finance Permanent School Fund
THURSDAY
April 16, 2015
9 a.m.
COMMITTEE ON SCHOOL FINANCE/PERMANENT SCHOOL FUND - Room 1-104
Members: Patricia Hardy, Chair; Lawrence A. Allen, Jr., Vice Chair; David Bradley;
Ken Mercer; Thomas Ratliff. 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. Attorney General Opinion on the Calculation of the PSF Bond Guarantee Limit for the Charter School Bond Guarantee Program
This item provides the committee an opportunity to discuss a recent attorney general opinion related to the calculation of capacity under the bond guarantee program for charter schools. Statutory authority is the Texas Education Code (TEC), §7.102(c)(33) and §45.063, and the Texas Constitution, Article VII, Section 5.
COMMITTEE - DISCUSSION
SBOE - NO ACTION
This item provides the committee the opportunity to discuss 19 TAC Chapter 33, Statement of Investment Objectives, Policies, and Guidelines of the Texas Permanent School Fund, Subchapter A, State Board of Education Rules, §33.65, Bond Guarantee Program for School Districts. There are no proposed amendments at this time, but the committee may wish to discuss potential amendments in light of the recent Attorney General Opinion No. KP-0005 related to the calculation of capacity for the Bond Guarantee Program. This will also provide the committee with the opportunity to discuss the definition of nationally recognized investment ratings firm since the current definition expires September 1, 2015. Statutory authority is the Texas Education Code (TEC), §7.102(c)(33) and §45.063, and the Texas Constitution, Article VII, Section 5.
COMMITTEE - DISCUSSION
SBOE - NO ACTION
This item provides the committee the opportunity to discuss 19 TAC Chapter 33, Statement of Investment Objectives, Policies, and Guidelines of the Texas Permanent School Fund, Subchapter A, State Board of Education Rules, §33.67, Bond Guarantee Program for Charter Schools. There are no proposed amendments at this time, but the committee may wish to discuss potential amendments in light of the recent Attorney General Opinion No. KP-0005 related to the calculation of capacity for the Bond Guarantee Program. This item also provides the committee the opportunity to discuss the definition of nationally recognized investment ratings firm since the current definition expires September 1, 2015. Statutory authority is the Texas Education Code (TEC), §7.102(c)(33) and §45.063, and the Texas Constitution, Article VII, Section 5.
COMMITTEE - DISCUSSION
SBOE - NO ACTION
4. Review of Permanent School Fund Securities Transactions and the Investment Portfolio
Investment staff will report on the transactions executed during the months of January and February 2015 in the investment portfolio of the Texas Permanent School Fund.
COMMITTEE - DISCUSSION
SBOE - NO ACTION
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 January and February 2015. Statutory authority for this action is the Texas Constitution, Article VII, §5(f).
COMMITTEE - ACTION
SBOE - CONSENT
This item provides an opportunity for representatives of the State Auditor’s Office (SAO) to make a presentation regarding the Bond Guarantee Program.
COMMITTEE - DISCUSSION
SBOE - NO ACTION
7. Adoption of an Annual Report on the Status of the Bond Guarantee Program
This item provides an opportunity for the committee and board to adopt an annual report on the status of the Bond Guarantee Program. Statutory authority for this action is the Texas Constitution, Article VII, §5(f).
COMMITTEE - ACTION
SBOE - CONSENT
8. Fourth Quarter 2014 Permanent School Fund Performance Report
The performance measurement consultant to the Permanent School Fund, BNY Mellon Asset Servicing, will report on the investment performance during the fourth calendar quarter 2014 and cumulative investment performance of the various portfolios of the Fund. This item will allow the committee to discuss in depth various issues related to portfolio management such as risk characteristics of portfolios and portfolio attributes.
COMMITTEE - DISCUSSION
SBOE - NO ACTION
9. Decision on Real Estate Investments
This item provides an opportunity for the committee and board to review and consider possible real estate investments. Statutory authority for this action is the Texas Constitution, Article VII, §5(f).
COMMITTEE - ACTION
SBOE - CONSENT
10. Presentations on Investment Management Services Provided to the Permanent School Fund
This item provides an opportunity for the committee to receive presentations and to review the investment management services provided to the Permanent School Fund. Presentations will be given by the managers in the global risk controlled strategies program. Statutory authority is the Texas Constitution, Article VII, §5(f).
COMMITTEE - DISCUSSION
SBOE - NO ACTION
11. 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. The report will 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 will 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 will provide an analysis of current and future investment market conditions, focusing upon the impact on the holdings of the Permanent School Fund. The committee will direct investment staff regarding future agenda items.
COMMITTEE - DISCUSSION
SBOE - NO ACTION