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Texas Statutes (Last Updated: January 4, 2014) |
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EDUCATION CODE |
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Title 2. PUBLIC EDUCATION |
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Subtitle I. SCHOOL FINANCE AND FISCAL MANAGEMENT |
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Chapter 43. PERMANENT SCHOOL FUND AND AVAILABLE SCHOOL FUND |
Sec. 43.006. INVESTMENT MANAGEMENT
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(a) The State Board of Education may delegate investment authority for the investment of the permanent school fund to the same extent as an institution with respect to an institutional fund under Chapter 163, Property Code.
(b) The board may enter into a contract with a nonprofit corporation for the corporation to invest funds under the control and management of the board, including the permanent school fund, as designated by the board. The corporation may not engage in any business other than investing funds designated by the board under the contract.
(c) The board must approve the:
(1) articles of incorporation and bylaws of the corporation and any amendment to the articles of incorporation or bylaws;
(2) investment policies of the corporation, including changes to those policies;
(3) audit and ethics committee of the corporation; and
(4) code of ethics of the corporation.
(d) The board of directors of the corporation must be members of the State Board of Education.
(e) If an investment contract entered into under Subsection (b) includes the permanent school fund within the scope of funds under the control and management of the State Board of Education to be invested by the corporation, the board shall provide for an annual financial audit of the permanent school fund. Subject to the legislative audit committee's approval of including the audit in the audit plan under Section 321.013(c), Government Code, the audit shall be performed by the state auditor.
(f) The corporation shall file quarterly reports with the State Board of Education concerning matters required by the board.
(g) The corporation is subject to the Texas Non-Profit Corporation Act (Article 1396-1.01 et seq., Vernon's Texas Civil Statutes).
(h) The corporation may not enter into an agreement or transaction with a:
(1) director, officer, or employee of the corporation acting in other than an official capacity on behalf of the corporation;
(2) business entity in which a director, officer, or employee of the corporation has an interest;
(3) former director, officer, or employee of the corporation on or before the second anniversary of the date the person ceased to be a director, officer, or employee of the corporation; or
(4) business entity in which a former director, officer, or employee of the corporation has an interest on or before the second anniversary of the date the person ceased to be a director, officer, or employee of the corporation.
(i) An agreement or transaction entered into in violation of Subsection (h) is void.
(j) For purposes of this section, a person has an interest in a business entity if:
(1) the person owns five percent or more of the voting stock or shares of the business entity;
(2) the person owns five percent or more of the fair market value of the business entity; or
(3) money received by the person from the business entity exceeds five percent of the person's gross income for the preceding calendar year.
(k) In this section, "institution" and "institutional fund" have the meanings assigned by Chapter 163, Property Code.