WEDNESDAY
July 18, 2012
10 a.m.
COMMITTEE ON SCHOOL FINANCE/PERMANENT SCHOOL FUND - Room 1-104
Members: Pat Hardy, Chair; Lawrence A. Allen, Jr.; David Bradley; Bob Craig; and 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 at http://www.tea.state.tx.us/index4.aspx?id=2147497741.
1. Proposed Amendment to 19 TAC Chapter 129, Student Attendance, Subchapter B, Student Attendance Accounting, §129.21, Requirements for Student Attendance Accounting for State Funding Purposes
(Second Reading and Final Adoption)
This item presents for second reading and final adoption proposed amendment to 19 TAC Chapter 129, Student Attendance, Subchapter B, Student Attendance Accounting, §129.21, Requirements for Student Attendance Accounting for State Funding Purposes. The proposed amendment would amend the rule to make it more logically organized, to delete obsolete provisions, and to update provisions describing conditions under which a student who is not on campus at attendance time may be considered in attendance. The proposed amendment would also remove language that duplicates statutory language and replace it with a reference to the applicable statute. No additional changes are recommended since approved for first reading. Statutory authority for this action is the Texas Education Code (TEC), §42.004.
COMMITTEE - ACTION
SBOE - ACTION
2. Per Capita Apportionment Rate for the 2011-2012 School Year
The board is responsible for setting a per capita apportionment rate for each school year based on an estimate of the amount available for expenditures from the Available School Fund. The board set the rate at $247.475 at its September 2011 meeting. The recommended revised rate for the 2011-2012 school year will be proposed at the July 2012 meeting of the Committee on School Finance/Permanent School Fund. Statutory authority for this action is the Texas Education Code (TEC), §42.004 and §43.001(b).
COMMITTEE - ACTION
SBOE - ACTION
3. Per Capita Apportionment Rate for the 2012-2013 School Year
The board is responsible for setting a per capita apportionment rate for each school year based on an estimate of the amount available for expenditures from the Available School Fund. The recommended rate for the 2012-2013 school year is $373.878. Statutory authority for this action is the Texas Education Code, (TEC) §42.004 and §43.001(b).
COMMITTEE - ACTION
SBOE - ACTION
4. Report by the State Auditor’s Office on the Certification of the Bond Guarantee Program for Fiscal Year Ending August 31, 2011
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
5. 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
6. Review of Permanent School Fund Securities Transactions and the Investment Portfolio
Investment staff will report on the transactions executed during the months of March, April and May 2012 in the investment portfolio of the Texas Permanent School Fund.
COMMITTEE - DISCUSSION
SBOE - NO ACTION
7. Ratification of the Purchases and Sales of the Investment Portfolio of the Permanent School Fund for the Months of March, April and May 2012
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 March, April and May 2012. Statutory authority for this action is the Texas Constitution, Article VII, §5(f).
COMMITTEE - ACTION
SBOE - CONSENT
8. First Quarter of 2012 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 first calendar quarter of 2012 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. Selection of Respondents to the Request for Proposals (RFP) for Commodities Discretionary Investment Managers for the Permanent School Fund
This item provides an opportunity for the committee and board to review and approve a list of candidates who responded to the request for proposals for commodities discretionary investment managers for the Permanent School Fund. The board will interview candidates as needed. Statutory authority for this action is the Texas Constitution, Article VII, §5(f).
COMMITTEE - ACTION
SBOE - ACTION
11. Decision on Absolute Return Investments
This item provides the opportunity for the committee and board to review the current manager allocations within the absolute return asset class and consider any changes to the managers’ watch list status or rebalancing of assets between new and existing managers. The board will consider termination of absolute return fund of fund managers and contract extensions where appropriate. Statutory authority for this action is the Texas Constitution, Article VII, §5(f).
COMMITTEE - ACTION
SBOE - ACTION
12. Selection of Qualified Respondents to the Request for Qualifications (RFQ) for Fiduciary Counsel, Alternative Assets Portfolio/Contracting and Tax Counsel for the Permanent School Fund
This item provides an opportunity for the committee and board to review and approve a list of qualified candidates who responded to the request for qualifications for fiduciary counsel, alternative assets portfolio/contracting and tax counsel for the Permanent School Fund. The board may interview candidates as needed and give staff appropriate directions. Statutory authority for this action is the Texas Constitution, Article VII, §5(f).
COMMITTEE - ACTION
SBOE - ACTION
13. 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, 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