Highlights 77th Texas Legislature - Senate

________________________________ BUDGET
77 th Texas Legislature
Investment and Management of the Permanent School Fund - S.B. 512
by Senators Duncan and Lindsay
House Sponsors: Representatives Gallego and Keel
Under current law, the State Board of Education (SBOE) is responsible for the investments of the
permanent school fund (PSF). The members of SBOE are not required to possess any investment
expertise, which makes it more difficult to manage the fund with prudence and to avoid conflicts of interest.
S.B. 512 establishes a permanent school fund investment advisory committee to advise SBOE regarding
the management of the PSF.
Amends the Education Code to create a permanent school fund investment advisory committee
(committee) composed of nine members, three each appointed by the governor, the lieutenant governor,
and the speaker of the house. Requires the committee to advise SBOE regarding the management and
investment of the fund. Provides that a person appointed to the committee must possess substantial
experience and expertise in investments.
Provides that if an interested person serves as a consultant and fails to disclose a potential conflict of
interest, the arrangement is voidable and SBOE or the comptroller may declare the person ineligible to
contract for business relating to the management or investment of the fund.
Provides that an interested person may be barred from contracting with SBOE for violating an ethics policy
or conflict of interest restriction.
Requires the legislative audit committee to select a qualified independent firm to evaluate investment
management practices and performance relating to the fund as often as the audit committee determines
necessary.
Annual Reports of State Agencies that Adjust Local Matching Funds - S.B. 519
by Senator Shapleigh
House Sponsor: Representative Gutierrez
Current law provides that certain state programs require communities to contribute local matching funds to
receive a grant or other form of financial assistance from a state agency. State agencies may waive or
adjust any matching funds requirement for an economically disadvantaged county or economically
disadvantaged census tract for such programs.
Requires each agency that adjusts a matching funds requirement to prepare and submit an annual report
describing each adjustment made by the agency during the preceding state fiscal year and the effects of
each adjustment on the agency's programs.
Requires a state agency to state the amount of each adjustment, the program under which the adjustment
was made, and the name of each county or the location of each census tract that benefited from the
adjustment.
Requires a state agency to produce an annual report.
Senate Research Center 28