Presentation and Review of the Absolute Return Portfolios Managed for the
Permanent School Fund
July 22, 2011
COMMITTEE ON SCHOOL FINANCE/PERMANENT SCHOOL FUND: ACTION
STATE BOARD OF EDUCATION: ACTION
SUMMARY: This item provides an opportunity for the committee and board to receive a presentation and to review the absolute return portfolios managed for the Permanent School Fund. Consideration will be given to potential structural and allocation changes within the investments.
STATUTORY AUTHORITY: Texas Constitution, Article VII, §5(f).
PREVIOUS BOARD ACTION: None.
BACKGROUND INFORMATION AND SIGNIFICANT ISSUES: At the July 2006 meeting, the board approved a long-term strategic asset allocation which included a 10% allocation to the absolute return asset class. K2 was placed on the Permanent School Fund watch list at the November 2010 meeting.
FISCAL IMPACT: The distribution of the Permanent School Fund is projected to be $1.9 billion during the 2012-2013 biennium.
PUBLIC AND STUDENT BENEFIT: The distribution of the Permanent School Fund will flow to the school districts and reduce the tax burden to the public and the state of Texas.
PROCEDURAL AND REPORTING IMPLICATIONS: Not applicable.
PUBLIC COMMENTS: None.
ALTERNATIVES: No alternative actions are proposed regarding this item.
OTHER COMMENTS AND RELATED ISSUES: None.
Commissioner of Education
Staff Member Responsible:
Holland Timmins, Executive Administrator
and Chief Investment Officer of the
Texas Permanent School Fund