By Greenberg H.B. No. 1354
74R3904 RJA-D
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to investment of certain public funds.
1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-4 SECTION 1. Chapter 2256, Government Code, is amended by
1-5 adding Subchapter E to read as follows:
1-6 SUBCHAPTER E. INVESTMENT ADVISORY COUNCILS
1-7 Sec. 2256.141. INVESTMENT ADVISORY COUNCILS CREATED. (a) A
1-8 separate investment advisory council shall advise each of the
1-9 following entities:
1-10 (1) the permanent university fund;
1-11 (2) the permanent school fund;
1-12 (3) the Employees Retirement System of Texas; and
1-13 (4) the Teacher Retirement System of Texas.
1-14 (b) In addition to the advisory councils provided for by
1-15 Subsection (a), a single investment advisory council shall advise
1-16 all public institutions of higher education, and a single
1-17 investment advisory council shall advise all public junior
1-18 colleges.
1-19 Sec. 2256.142. ADVISORY COUNCIL MEMBERSHIP. (a) An
1-20 advisory council is composed of nine members appointed by
1-21 _______________.
1-22 (b) A council member must have professional experience in
1-23 the field of investments.
1-24 Sec. 2256.143. INAPPLICABILITY OF GENERAL LAW. Article
2-1 6252-33, Revised Statutes, does not apply to a council.
2-2 Sec. 2256.144. OPEN MEETINGS; OPEN RECORDS. (a) A council
2-3 is subject to the open meetings law, Chapter 551.
2-4 (b) A council is subject to the open records law, Chapter
2-5 552.
2-6 Sec. 2256.145. SUNSET REVIEW. Each council is subject to
2-7 review under Chapter 325 (Texas Sunset Act) but is not abolished
2-8 under that chapter. Each council shall be reviewed during the
2-9 period in which _______________ is reviewed.
2-10 Sec. 2256.146. CONFLICT OF INTEREST. (a) An officer,
2-11 employee, or paid consultant of a Texas trade association in the
2-12 field of investments may not be a member of a council.
2-13 (b) A person who is the spouse of an officer, manager, or
2-14 paid consultant of a Texas trade association in the field of
2-15 investments may not be a member of a council.
2-16 (c) For purposes of this section, a Texas trade association
2-17 is a nonprofit, cooperative, and voluntarily joined association of
2-18 business or professional competitors in this state designed to
2-19 assist its members and its industry or profession in dealing with
2-20 mutual business or professional problems and in promoting their
2-21 common interest.
2-22 Sec. 2256.147. PRESIDING OFFICER. Each council shall select
2-23 a presiding officer from its membership.
2-24 Sec. 2256.148. COMPENSATION; EXPENSES. A member of a
2-25 council is not entitled to receive compensation, but is entitled to
2-26 reimbursement of the member's travel expenses as provided in the
2-27 General Appropriations Act.
3-1 Sec. 2256.149. QUARTERLY REPORT. (a) An entity for which
3-2 an investment council is provided for by this subchapter shall
3-3 report quarterly to its investment advisory council.
3-4 (b) The report must:
3-5 (1) include a balance sheet at quarter end and an
3-6 income statement for the previous quarter of investments made by
3-7 the entity;
3-8 (2) disclose any transaction greater than _____
3-9 percent of invested funds in any month other than transaction of
3-10 investments in money market accounts, treasury bills, or ________;
3-11 and
3-12 (3) if the entity invests only in money market
3-13 accounts, treasury bills, or _______________, provide a statement
3-14 to that effect.
3-15 Sec. 2256.150. COUNCIL REVIEW. A council shall review
3-16 reports received under Section 2256.149 and notify the board of an
3-17 affected entity if the entity reports an investment practice that
3-18 could pose a significant liquidity risk to the entity.
3-19 SECTION 2. Chapter 2256, Government Code, is amended by
3-20 adding Subchapter F to read as follows:
3-21 SUBCHAPTER F. INVESTMENT POLICIES
3-22 Sec. 2256.161. APPLICABILITY. This subchapter applies to:
3-23 (1) a state agency, as defined by Section 403.0165;
3-24 (2) an institution of higher education, as defined by
3-25 Section 61.003, Education Code; and
3-26 (3) a political subdivision of this state.
3-27 Sec. 2256.162. INVESTMENT POLICY. In addition to an
4-1 investment policy otherwise required by Section 2256.004, each
4-2 entity subject to this subchapter that invests in securities other
4-3 than money market accounts, treasury bills, or _______________
4-4 shall develop a written investment policy that reflects prudent
4-5 investment policies of _______________.
4-6 SECTION 3. This Act takes effect September 1, 1995.
4-7 SECTION 4. The importance of this legislation and the
4-8 crowded condition of the calendars in both houses create an
4-9 emergency and an imperative public necessity that the
4-10 constitutional rule requiring bills to be read on three several
4-11 days in each house be suspended, and this rule is hereby suspended.