Amend SB 512 by striking all below the enacting clause and
substituting the following:
SECTION 1. Chapter 43, Education Code, is amended by adding
Section 43.0011 to read as follows:
Sec. 43.0011. PERMANENT SCHOOL FUND INVESTMENT ADVISORY
COMMITTEE. (a) The permanent school fund investment advisory
committee shall advise the State Board of Education regarding
management and investment of the permanent school fund.
(b) The committee is composed of:
(1) two members appointed by the governor, who are not
subject to confirmation by the senate;
(2) one member appointed by the lieutenant governor;
(3) one member appointed by the speaker of the house
of representatives; and
(4) one member appointed by the State Board of
Education.
(c) A person appointed to the committee must have
appropriate expertise in investing institutional funds, as
determined by the appointing entity.
(d) Members of the committee serve staggered terms of six
years, with the terms of one or two members expiring February 1 of
each odd-numbered year, except that a member may be removed by the
appointing entity for good cause.
(e) For purposes of this section, "good cause" means:
(1) a serious violation of a law relating to the
member's official duties as a committee member or to the conduct of
public officials generally;
(2) gross or persistent failure to perform the
committee member's duties as a committee member;
(3) conduct that is reasonably likely to undermine the
public's trust in the committee member; or
(4) conduct that constitutes a felony or a crime of
moral turpitude, if the committee member is charged with or
convicted of a criminal offense.
(f) For purposes of Subsection (e), failure to attend any
meetings of the committee over a period of six months, if more than
one meeting is held during that period, constitutes persistent
failure to perform the member's duties as a committee member.
(g) The committee shall meet regularly to advise the State
Board of Education regarding the management and investment of the
permanent school fund.
(h) A committee member may not receive compensation for
performing duties as a committee member but is entitled to
reimbursement for travel expenses incurred by the member while
conducting the business of the committee as provided by the General
Appropriations Act.
(i) The committee is not subject to Chapter 2110, Government
Code.
SECTION 2. Section 43.0031(b), Education Code, is amended to
read as follows:
(b) The ethics policy must include provisions applicable to:
(1) members of the State Board of Education;
(2) members of the permanent school fund investment
advisory committee;
(3) the commissioner;
(4) <(3)> employees of the agency; and
(5) <(4)> any person who provides services to the
board relating to the management or investment of the permanent
school fund.
SECTION 3. Section 43.0032, Education Code, is amended to
read as follows:
Sec. 43.0032. CONFLICTS OF INTEREST. (a) This section
applies to:
(1) a <A> member of the State Board of Education;
(2) a member of the permanent school fund advisory
committee;
(3) <,> the commissioner;
(4) <,> an employee of the agency; and
(5) <, or> a person who provides services to the board
that relate to the management or investment of the permanent school
fund.
(b) A person to whom this section applies who has a
business, commercial, or other relationship that a reasonable
person would find likely <could reasonably be expected> to diminish
the person's independence of judgment in the performance of the
person's responsibilities relating to the management or investment
of the fund shall disclose the relationship in writing to the
board.
(c) <(b)> The board or the board's designee shall, in the
ethics policy adopted under Section 43.0031, define the kinds of
relationships that may create a possible conflict of interest.
(d) <(c)> A person who files a statement under Subsection
(b) <(a)> disclosing a possible conflict of interest may not give
advice or make decisions about a matter affected by the possible
conflict of interest unless the board, after consultation with the
general counsel of the agency, expressly waives this prohibition.
The board may delegate the authority to waive the prohibition
established by this subsection.
SECTION 4. Section 43.0033, Education Code, is amended to
read as follows:
Sec. 43.0033. REPORTS OF EXPENDITURES. A consultant,
advisor, broker, or other person providing services to the State
Board of Education relating to the management and investment of the
permanent school fund shall file with the board regularly, as
determined by the board, a report that describes in detail any
expenditure of more than $50 made by the person on behalf of:
(1) a member of the board;
(2) a member of the permanent school fund advisory
committee;
(3) the commissioner; or
(4) <(3)> an employee of the agency or of a nonprofit
corporation created under Section 43.006.
SECTION 5. Chapter 43, Education Code, is amended by adding
Section 43.0035 to read as follows:
Sec. 43.0035. EMPLOYMENT OR COMPENSATION OF LOBBYIST
PROHIBITED. (a) A person who serves as a money manager, advisor,
consultant, or broker regarding the permanent school fund may not
knowingly employ or compensate a person who is or would be required
to register under Chapter 305, Government Code, to communicate
directly with a member of the legislative branch, the State Board
of Education, or the permanent school fund investment advisory
committee on a matter relating to the permanent school fund.
(b) If the State Board of Education determines that a person
has violated this section, the board shall terminate the person's
contract to provide services regarding the permanent school fund.
(c) A person who violates Subsection (a) commits an offense.
An offense under this subsection is a Class B misdemeanor.
(d) In this section, "communicate directly with" and "member
of the legislative branch" have the meanings assigned by Section
305.002, Government Code.
SECTION 6. Chapter 43, Education Code, is amended by adding
Section 43.0061 to read as follows:
Sec. 43.0061. BOARD ACTION ON INVESTMENT DECISIONS. In
considering and making investment decisions relating to the
permanent school fund, the State Board of Education must meet and
act as a body corporate. The board may not create a committee or
subcommittee to consider or make such investment decisions.
SECTION 7. Section 43.005, Education Code, is repealed.
SECTION 8. Not later than November 1, 2001, the governor,
lieutenant governor, speaker of the house of representatives, and
the State Board of Education shall each appoint the initial members
of the permanent school fund advisory committee, as required by
Section 43.0011, Education Code, as added by this Act. The
governor shall appoint one person for a term expiring February 1,
2003, and one person for a term expiring February 1, 2007. The
person appointed by the lieutenant governor serves a term expiring
February 1, 2007. The persons appointed by the speaker of the
house of representatives and the State Board of Education serve
terms expiring February 1, 2005.
SECTION 9. This Act takes effect September 1, 2001.