November 2015 Committee on School Finance Permanent School Fund
THURSDAY
November 19, 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. Approval of Costs of Administering the 2015-2016 State of Texas Assessments of Academic Readiness (STAAR) and the Texas English Language Proficiency Assessment System (TELPAS) Assessments to Private School Students
Texas Education Code (TEC), §39.033, provides for the voluntary assessment of Texas private school 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) is charged with determining 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 2015-2016 school year. Statutory authority for this action is the TEC, §39.033.
COMMITTEE - ACTION
SBOE - CONSENT
2. Presentation on the Charter District Bond Guarantee Reserve Fund
This item provides an opportunity for the committee to receive a presentation on the charter district bond guarantee reserve fund.
COMMITTEE - DISCUSSION
SBOE - NO ACTION
3. Review of Permanent School Fund Securities Transactions and the Investment Portfolio
Investment staff will report on the transactions executed during the months of August and September 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 August and September 2015. Statutory authority for this action is the Texas Constitution, Article VII, §5(f).
COMMITTEE - ACTION
SBOE - CONSENT
5. Third Quarter 2015 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 third calendar quarter 2015 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
Texas Government Code, §2001.039, establishes a four-year rule review cycle for all state agency rules, including State Board of Education (SBOE) rules. This item presents the adoption of the review of 19 TAC Chapter 33, Statement of Investment Objectives, Policies, and Guidelines of the Texas Permanent School Fund, Subchapter A, State Board of Education Rules. The rules being reviewed establish definitions, requirements, and procedures for the investment of the Permanent School Fund (PSF). The statutory authority for the rule review is the Texas Government Code, §2001.039. The statutory authority for 19 TAC Chapter 33 is the Texas Education Code (TEC), §§7.102(c)(31) and (33), 43.0031-43.004, and 45.051-45.063; the Texas Government Code, §2263.004; and the Texas Constitution, Article VII, §5(f).
COMMITTEE - ACTION
SBOE - CONSENT
7. 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
8. Decision on Absolute Return Investments
This item provides an opportunity for the board to review the absolute return portfolio and consider a contract extension with Mesirow Advanced Strategies. Statutory authority for this action is the Texas Constitution, Article VII, §5(f).
COMMITTEE - ACTION
SBOE - CONSENT
9. Presentations on Investment Management Services Provided to the Permanent School Fund
This item provides an opportunity for the committee to receive presentations from managers investing for the Permanent School Fund. The managers of the emerging market debt and risk parity programs will give presentations.
COMMITTEE - DISCUSSION
SBOE - NO ACTION
10. 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.
COMMITTEE - DISCUSSION
SBOE - NO ACTION