Miller Calls for Experienced Investment Team as SBOE Considers Firms to Oversee the Permanent School Fund

For Immediate Release
Monday, July 13, 2009

Alexis DeLee at (512) 633-2620

Miller calls for experienced investment team as SBOE considers firms to oversee the Permanent School Fund

(Austin) – Geraldine “Tincy” Miller, member of State Board of Education for District 12, says that experience needs to be the determining factor in choosing a team to provide Investment Counsel Services and Global Custody and Securities Lending Services for the Permanent School Fund. The Board has been in the selection process for the past year. It has received proposals from a number of fund managers from across the country, and it is set to make a final decision this week at a meeting of the Committee on School Finance and Permanent School Fund.

In her 25 years on the Board, Miller has fought to protect the fund from raids by the legislature to pay for other school expenses. However, equally important is the guarantee that the fund can generate enough revenue to accomplish its purpose of providing free textbooks to all Texas school children.

“The oversight and protection of the Permanent School Fund is one of the State Board of Education’s key responsibilities, as well as ethical transparency,” Miller said. “Therefore, the Committee on School Finance and Permanent School Fund must choose a fund manager with a proven track record. We cannot afford to leave the management of this endowment in inexperienced hands and risk losing such a valuable state asset.”

The Permanent School Fund was created in 1854 to provide free books to Texas school children. It is one of the top 10 endowments in the country and ranges from $17 to $20 billion. As of last Friday, July 10, the market value of the Fund was $18.4 billion and generates approximately $700 to $800 million a year. The Fund has always met the obligation of providing enough money to pay for all the textbooks for each student ($4.6 million) with plenty of money left over to meet instructional needs.

The current Texas system for funding instructional content is a national model because it ensures every child has materials in every subject. Textbook funding is equitable and adequate, and districts do not have to strain up against their tax rates to make sure all students have the learning materials they need.

The SBOE meeting will take place this week from Wednesday, July 15 through Friday, July 17. Discussion of the investment teams will take place on Tuesday, July 14 at 1 p.m. and Wednesday, July 15 at 8:30 a.m. at a meeting of the Committee on School Finance and Permanent School Fund. During the full board meeting, the SBOE will be adopting the new updated curriculum for Career and Technical Education and will receive an update on the new legislation passed during the most recent session of the Texas Legislature. All final votes will be taken on Friday morning.