HBA-MSH, JEK H.J.R. 74 77(R) BILL ANALYSIS Office of House Bill AnalysisH.J.R. 74 By: Keel Public Education 3/12/2001 Introduced BACKGROUND AND PURPOSE Under current law, the investment and management of the permanent school fund (fund) is a responsibility of the State Board of Education. The members of the board of education are not required to possess any investment expertise, which makes it more difficult to manage the fund with prudence and avoid conflicts of interest regarding advice from investment consultants. As proposed, House Joint Resolution 74 requires the submission to the voters of a constitutional amendment providing for the transfer of authority to invest and manage the permanent school fund from the State Board of Education to the Permanent School Fund Investment Board, and modifying the standards used to determine appropriate investment and management decisions. RULEMAKING AUTHORITY It is the opinion of the Office of House Bill Analysis that this resolution does not expressly delegate any additional rulemaking authority to a state officer, department, agency, or institution. ANALYSIS House Joint Resolution 74 amends the Texas Constitution to require the Permanent School Fund Investment Board (board) to invest and manage the assets of the permanent school fund (fund). The resolution sets forth provisions relating to the appointment of nine board members. The resolution provides that a person must have appropriate expertise in investing institutional funds to be eligible for appointment to the board. The resolution authorizes the board to manage investments with the reasonable care, skill, and caution that prudent investors would use. FOR ELECTION This proposed constitutional amendment shall be submitted to the voters at an election to be held November 6, 2001.