February 2015 Committee on School Finance Permanent School Fund
THURSDAY
February 12, 2015
9 a.m.
COMMITTEE ON SCHOOL FINANCE/PERMANENT SCHOOL FUND - Room 1-100
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. Election of Chair
(no agenda exhibit)
State Board of Education (SBOE) operating rules call for each committee to elect a chair from among its members. This item provides an opportunity for each of the SBOE standing committees to elect a chair in the event that the SBOE elects to retain the existing committee structure. The chair may 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 for this action is the Texas Education Code, §7.107.
COMMITTEE - ACTION
SBOE - NO ACTION
2. Proposed Amendment to 19 TAC Chapter 109, Budgeting, Accounting, and Auditing, Subchapter B, Texas Education Agency Audit Functions, §109.23, School District Independent Audits and Agreed-Upon Procedures
(Second Reading and Final Adoption)
This item presents the proposed amendment to 19 TAC Chapter 109, Budgeting, Accounting, and Auditing, Subchapter B, Texas Education Agency Audit Functions, §109.23, School District Independent Audits and Agreed-Upon Procedures, for second reading and final adoption. The proposed amendment would address provisions relating to a school district or other educational entity hiring an independent auditor. The proposed amendment would also add and clarify other administrative provisions and make technical edits. No changes are recommended since approved for first reading. Statutory authority for this action is the Texas Education Code (TEC), §§7.102(c)(32), 44.001, 44.007, and 44.008.
COMMITTEE - ACTION
SBOE - 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 October, November, and December 2014 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 securities executed in the portfolio of the Permanent School Fund for the months of October, November, and December 2014. Statutory authority for this action is the Texas Constitution, Article VII, §5(f).
COMMITTEE - ACTION
SBOE - CONSENT
5. Annual Reporting Requirement 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.
COMMITTEE - DISCUSSION
SBOE - NO ACTION
6. Report by the State Auditor’s Office on the Audit of the Permanent School Fund’s Financial Statements for Fiscal Year Ending August 31, 2014
This item provides an opportunity for representatives of the State Auditor’s Office (SAO) to make a presentation regarding the audit of the financial statements of the Permanent School Fund for fiscal year ending August 31, 2014, and material accounts of the Fund reported by the Texas Education Agency.
COMMITTEE - DISCUSSION
SBOE - NO ACTION
7. Overview of the Real Estate Asset Class
This item provides an opportunity for the committee and board to review the real estate policies, procedures and tactical plan. Statutory authority for this action is the Texas Constitution, Article VII, §5(f).
COMMITTEE - ACTION
SBOE - CONSENT
8. 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
9. Authorization to Issue a Request for Qualifications (RFQ) for Rating Agencies for the Permanent School Fund
This item provides an opportunity for the committee and board to approve the issuance of a request for qualifications for rating agencies for the Permanent School Fund. Statutory authority for this action is the Texas Constitution, Article VII, §5(f).
COMMITTEE - ACTION
SBOE - CONSENT
This item provides an opportunity for the committee and board to approve the issuance of a request for proposals for investment counsel services for the Permanent School Fund. Statutory authority for this action is the Texas Constitution, Article VII, §5(f).
COMMITTEE - ACTION
SBOE - CONSENT
11. 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 of the private equity and the international index programs. Statutory authority is the Texas Constitution, Article VII, §5(f).
COMMITTEE - DISCUSSION
SBOE - NO ACTION
12. 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