By: Smith, Ashley H.B. No. 1541
73R6267 E
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to the management, investment, and expenditure of funds
1-3 held by public institutions of higher education.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Section 163.002, Property Code, is amended to
1-6 read as follows:
1-7 Sec. 163.002. Legislative Findings and Purpose. (a) The
1-8 legislature finds that:
1-9 (1) public and privately supported educational,
1-10 religious, and charitable organizations perform essential and
1-11 needed services in the state;
1-12 (2) uncertainty regarding legal restrictions on the
1-13 management, investment, and expenditure of endowment funds of the
1-14 organizations has in many instances precluded obtaining the highest
1-15 available return on endowment funds; and
1-16 (3) the organizations, their officers, directors, and
1-17 trustees, and the citizens of this state will benefit from removal
1-18 of the uncertainty and by permitting endowment funds to be invested
1-19 for the long-term goals of achieving growth and maintaining
1-20 purchasing power without adversely affecting availability of funds
1-21 for current expenditure.
1-22 (b) The purpose of this chapter is to provide guidelines for
1-23 the management, investment, and expenditure of endowment funds of
1-24 public and privately supported educational, religious, and
2-1 charitable organizations in order to eliminate the uncertainty
2-2 regarding legal restrictions on the management, investment, and
2-3 expenditure of the funds and to enable the organizations to
2-4 maximize their resources.
2-5 SECTION 2. Section 163.003(5), Property Code, is amended to
2-6 read as follows:
2-7 (5) "Institution" means an institution of higher
2-8 education as defined by Section 61.003, Education Code, and an
2-9 incorporated or unincorporated organization organized and operated
2-10 exclusively for educational, religious, or charitable purposes.
2-11 The term does not include:
2-12 (A) <an institution of higher education as
2-13 defined by Section 61.003, Education Code, or other governmental
2-14 entity, or> a foundation chartered for the benefit of an
2-15 institution of higher education as defined by Section 61.003,
2-16 Education Code <that type of institution or entity>, or the benefit
2-17 of a component of that type of institution or entity; or
2-18 (B) a private foundation as defined by Section
2-19 509(a) of the Internal Revenue Code of 1986.
2-20 SECTION 3. The importance of this legislation and the
2-21 crowded condition of the calendars in both houses create an
2-22 emergency and an imperative public necessity that the
2-23 constitutional rule requiring bills to be read on three several
2-24 days in each house be suspended, and this rule is hereby suspended.