April 2020 Committee on School Finance/Permanent School Fund
THURSDAY
April 16, 2020
11:00 a.m. or upon adjournment of the Committee of the Full Board
COMMITTEE ON SCHOOL FINANCE/PERMANENT SCHOOL FUND
Members: Tom Maynard, chair; Lawrence A. Allen, Jr., vice chair; Donna Bahorich; Patricia Hardy; Ken Mercer. 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. Proposed Repeal of 19 TAC Chapter 105, Foundation School Program, Subchapter B, Use of State Funds
(Second Reading and Final Adoption)
This item presents for second reading and final adoption the proposed repeal of 19 Texas Administrative Code (TAC) Chapter 105, Foundation School Program, Subchapter B, Use of State Funds, §105.11, Maximum Allowable Indirect Cost, and §105.12, Basic Allotment. The proposed repeals would implement House Bill (HB) 3, 86th Texas Legislature, 2019, which removed the State Board of Education's (SBOE's) rulemaking authority related to maximum allowable indirect costs and the basic allotment for the Foundation School Program (FSP). No changes are recommended since approved for first reading. Statutory authority for this action is the Texas Education Code (TEC), §48.004, as transferred, redesignated, and amended by HB 3, 86th Texas Legislature, 2019.
COMMITTEE – ACTION
SBOE – 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
(First Reading and Filing Authorization)
This item presents for first reading and filing authorization proposed amendment to 19 Texas Administrative Code (TAC) Chapter 109, Budgeting, Accounting, and Auditing, Subchapter B, Texas Education Agency Audit Functions, §109.23, School District Independent Audits and Agreed-Upon Procedures. The proposed amendment would reflect changes made by House Bill (HB) 1520, 86th Texas Legislature, 2019, that eliminated the requirement for out-of-state certified public accountancy (CPA) firms to be licensed in Texas. Statutory authority for this action is the Texas Education Code (TEC), §§7.102(c)(32), 44.001, 44.007, 44.008, and 44.010.
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 December 2019, January and February 2020 in the investment portfolio of the Texas Permanent School Fund. Statutory authority for this item is the Texas Constitution, Article VII, §2 and §5, and 19 Texas Administrative Code (TAC) Chapter 33.
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 December 2019, January and February 2020. Statutory authority for this action is the Texas Constitution, Article VII, §2 and §5, and 19 Texas Administrative Code (TAC) Chapter 33.
COMMITTEE – ACTION
SBOE – CONSENT
5. 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 and the Charter District Reserve Fund. The report may 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 may 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 may provide an analysis of current and future investment market conditions, focusing upon the impact on the holdings of the PSF. Statutory authority for this item is Texas Constitution, Article VII, §2 and §5, 19 Texas Administrative Code (TAC) Chapter 33.
COMMITTEE – DISCUSSION
SBOE – NO ACTION