85R11804 JJT-D

By: Howard H.B. No. 2658

A BILL TO BE ENTITLED

AN ACT

relating to establishing the State of Texas Wealth Fund; making an appropriation.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

SECTION 1. Subchapter G, Chapter 403, Government Code, is amended by adding Section 403.1085 to read as follows:

Sec. 403.1085. STATE OF TEXAS WEALTH FUND. (a) In this section, "fund" means the State of Texas Wealth Fund.

(b) The State of Texas Wealth Fund is created as a special fund in the state treasury outside the general revenue fund to be administered by the comptroller. The fund consists of all money transferred or credited to the fund at the direction of the legislature or by other law and any gifts, grants, or donations made to this state for a purpose of the fund.

(c) The comptroller shall invest the assets of the fund and any accounts established in the fund taking into account the purposes for which the fund is established. In managing the fund assets, through procedures and subject to restrictions that the comptroller considers appropriate but notwithstanding the limitations specified by Section 404.024, the comptroller may acquire, exchange, sell, supervise, manage, or retain any kind of investment that a prudent investor, exercising reasonable care, skill, and caution, would acquire or retain in light of the purposes, terms, and other circumstances of the fund then prevailing, taking into consideration the investment of all the fund assets rather than a single investment.

(d) All interest and other earnings on the fund's principal and accumulated earnings are credited to the fund.

(e) Except as provided by Subsections (f) and (g), money in the fund may be appropriated only:

(1) to pay costs of deferred maintenance of state infrastructure, including costs of repair, rehabilitation, or reconstruction of state infrastructure;

(2) to make payments of the principal of or interest on general obligation bonds of this state or payments under related credit agreements to the extent the payments will help to retire the indebtedness before the end of the term of the indebtedness; and

(3) to pay the costs of a capital project for this state in lieu of financing the project costs with bonds or other long-term obligations of this state.

(f) An appropriation described by Subsection (e)(3) may not be made unless the legislature first finds that the direct payment of the costs of the capital project will achieve significant cost savings compared to using long-term obligations of this state to finance the costs.

(g) The legislature may not appropriate money from the fund in an amount that would reduce the unappropriated and unobligated principal balance of the fund to an amount of less than $2 billion.

(h) The fund is exempt from the application of Section 403.095.

SECTION 2. Section 404.071(a), Government Code, is amended to read as follows:

(a) Interest received from investments of money in funds and accounts in the charge of the comptroller shall be allocated on a monthly basis as follows:

(1) the pro rata portion of the interest received due to each constitutional fund shall be credited to that fund;

(2) the pro rata portion of the interest received due to the game, fish, and water safety fund shall be credited to that fund;

(2-a) the pro rata portion of the interest received due to the investment of the State of Texas Wealth Fund shall be credited to that fund; and

(3) the remainder of the interest received shall be credited to the general revenue fund.

SECTION 3. (a) The amount of $2 billion is appropriated from the economic stabilization fund to the comptroller for the purpose of transferring that amount immediately to the credit of the State of Texas Wealth Fund in the state treasury.

(b) This section takes effect only if this Act is approved by a vote of two-thirds of the members present in each house of the legislature, as provided by Section 49-g(m), Article III, Texas Constitution.

SECTION 4. This Act takes effect September 1, 2017.