Bill not drafted by TLC or Senate E&E.
Line and page numbers may not match official copy.
By Williams H.J.R. No. 111
A JOINT RESOLUTION
1-1 proposing a constitutional amendment with respect to the powers and
1-2 duties of trustees of statewide public employee pension funds.
1-3 BE IT RESOLVED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-4 SECTION 1. Section 67(a)(3), Article XVI, Texas Constitution
1-5 is amended to read as follows:
1-6 (a)(3). Each statewide benefit system must have a board of
1-7 trustees to administer the system [and to invest the funds of the
1-8 system in such securities as the board may consider prudent
1-9 investments.] In managing the assets of the fund the board may
1-10 acquire, exchange, sell, supervise, manage, or retain, through
1-11 procedures and subject to restrictions it establishes and in
1-12 amounts it considers appropriate, any kind of investment, [In making
1-13 investments, a board shall exercise the judgment and care under the
1-14 circumstances then prevailing] that persons of ordinary prudence,
1-15 discretion and intelligence, exercising the judgment and care under
1-16 the circumstances then prevailing, acquire or retain for their own
1-17 account [exercise] in the management of their own affairs, not in
1-18 regard to speculation, but in regard to the permanent disposition
1-19 of their funds, considering the probable income therefrom as well
1-20 as the probable safety of their capital. Whether a trustee has
1-21 exercised prudence with respect to an investment decision shall be
1-22 determined not in isolation but in the context of the trust
1-23 portfolio and as a part of an overall investment strategy, which
1-24 should incorporate risk and return objectives reasonably suited to
2-1 the trust. The legislature by law may further restrict the
2-2 investment discretion of a board.
2-3 SECTION 2. This proposed constitutional amendment shall be
2-4 submitted to the voters at an election to be held November 4, 1997.
2-5 The ballot shall be printed to permit voting for or against the
2-6 proposition: "The constitutional amendment providing that trustees
2-7 are to supervise and manage the investment of statewide public
2-8 employee pension funds in any kind of investment under standards of
2-9 care used by prudent persons that take into consideration the
2-10 overall objectives and strategy for the entire trust portfolio."