78R4203 ESH-D
By: Duncan S.J.R. No. 35
A JOINT RESOLUTION
proposing a constitutional amendment relating to making
distributions from the permanent school fund to the available
school fund and creating the education excellence supplemental
fund.
BE IT RESOLVED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 5, Article VII, Texas Constitution, is
amended to read as follows:
Sec. 5. (a) The principal of all bonds and other funds, and
the principal arising from the sale of the lands hereinbefore set
apart to said school fund, shall be the permanent school fund, and
the available school fund shall consist of the distributions made
to it from the total return on all investment assets of the
permanent school fund [all the interest derivable therefrom] and
the taxes herein authorized and levied [shall be the available
school fund]. The education excellence supplemental fund shall
consist of the distributions made to it from the total return on all
investment assets of the permanent school fund. The total amount
distributed from the permanent school fund to the available school
fund and the education excellence supplemental fund in each fiscal
year must be an amount equal to:
(1) at least three percent but not more than six
percent of the market value of the permanent school fund on the
first day of that fiscal year, in accordance with the rate adopted
by a vote of two-thirds of the total membership of the State Board
of Education; or
(2) five percent of the market value of the permanent
school fund on the first day of that fiscal year, if the State Board
of Education does not adopt a rate under Subdivision (1) of this
subsection.
(b) The available school fund shall be applied annually to
the support of the public free schools. Except as provided by this
section, no law shall ever be enacted appropriating any part of the
permanent or available school fund to any other purpose whatever;
nor shall the same, or any part thereof ever be appropriated to or
used for the support of any sectarian school. The[; and the]
available school fund [herein provided] shall be distributed to the
several school districts [counties] according to their scholastic
population and applied in such manner as may be provided by law. If
the total amount to be distributed from the permanent to the
available school fund and the education excellence supplemental
fund under Subsection (a) of this section for a fiscal year,
together with all taxes or other amounts dedicated to the available
school fund for that fiscal year, is sufficient, the distribution
from the available school fund to a school district for that fiscal
year must equal the distribution from the available school fund
that the school district received for the state fiscal year
beginning September 1, 2003, adjusted as provided by general law
for inflation and changes in the district's scholastic population.
If the total amount to be distributed under Subsection (a) of this
section for a fiscal year, together with taxes or other amounts
dedicated to the available school fund for that fiscal year, is not
sufficient to make distributions to school districts as required by
this subsection, the total amount distributed under Subsection (a)
of this section for that fiscal year must be distributed to the
available school fund for distribution to the several school
districts according to their scholastic population.
(c) The education excellence supplemental fund consists of
the difference between the total amount distributed from the
permanent school fund under Subsection (a) of this section, less
the amount required, after including all taxes or other amounts
dedicated to the available school fund, to permit making the
distributions from the available school fund required under
Subsection (b) of this section. The education excellence
supplemental fund may be used only as directed by the legislature
and only for a purpose related to improving public education,
including the provision of a group health insurance program for
active or retired employees of the public schools.
(d) [(b)] The legislature by law may provide for using the
permanent school fund [and the income from the permanent school
fund] to guarantee bonds issued by school districts or by the state
for the purpose of making loans to or purchasing the bonds of school
districts for the purpose of acquisition, construction, or
improvement of instructional facilities including all furnishings
thereto. If any payment is required to be made by the permanent
school fund as a result of its guarantee of bonds issued by the
state, an amount equal to this payment shall be immediately paid by
the state from the treasury to the permanent school fund. An amount
owed by the state to the permanent school fund under this section
shall be a general obligation of the state until paid. The amount
of bonds authorized hereunder shall not exceed $750 million or a
higher amount authorized by a two-thirds record vote of both houses
of the legislature. If the proceeds of bonds issued by the state
are used to provide a loan to a school district and the district
becomes delinquent on the loan payments, the amount of the
delinquent payments shall be offset against state aid to which the
district is otherwise entitled.
(e) [(c)] The legislature may appropriate part of the
permanent [available] school fund for administration of the
permanent school fund or of a bond guarantee program established
under this section.
(f) [(d)] Notwithstanding any other provision of this
constitution, in managing the assets of the permanent school fund,
the State Board of Education may acquire, exchange, sell,
supervise, manage, or retain, through procedures and subject to
restrictions it establishes and in amounts it considers
appropriate, any kind of investment, including investments in the
Texas growth fund created by Article XVI, Section 70, of this
constitution, that persons of ordinary prudence, discretion, and
intelligence, exercising the judgment and care under the
circumstances then prevailing, acquire or retain for their own
account in the management of their affairs, not in regard to
speculation but in regard to the permanent disposition of their
funds, considering the probable income as well as the probable
safety of their capital.
(g) Notwithstanding Subsection (a)(1) of this section, the
total distribution from the permanent school fund to the available
school fund and the education excellence supplemental fund for the
state fiscal years beginning September 1, 2004, and September 1,
2005, must be an amount equal to five percent of the market value of
the permanent school fund on the first day of the appropriate fiscal
year. This subsection expires December 1, 2006.
SECTION 2. This proposed constitutional amendment shall be
submitted to the voters at an election to be held November 4, 2003.
The ballot shall be printed to permit voting for or against the
proposition: "The constitutional amendment relating to making
distributions from the permanent school fund to the available
school fund and to the creation of the education excellence
supplemental fund."