Texas 2009 - 81st Regular

Texas Senate Bill SB2331 Compare Versions

Only one version of the bill is available at this time.

Old	New	Differences
1	1	By: West S.B. No. 2331
2	2
3	3
4	4	A BILL TO BE ENTITLED
5	5	AN ACT
6	6	relating to the establishment of the Texas power source fund.
7	7	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
8	8	SECTION 1. Subtitle F, Title 4, Government Code, is amended
9	9	by adding Chapter 490D to read as follows:
10	10	CHAPTER 490D. TEXAS POWER SOURCE FUND
11	11	Sec. 490D.001. TEXAS POWER SOURCE FUND. (a) In this
12	12	section:
13	13	(1) "Board of trustees" means the board of trustees of
14	14	the Texas power source fund.
15	15	(2) "Fund" means the Texas power source fund.
16	16	(b) The Texas power source fund is created as a trust fund
17	17	outside the state treasury. Except as otherwise provided by this
18	18	section, the fund is subject to the general laws of this state
19	19	governing private sector trusts. Only individuals who are
20	20	residents of this state and political subdivisions of this state
21	21	may invest in the fund.
22	22	(c) The comptroller shall invest in the fund on the behalf
23	23	of this state one dollar from the general revenue fund to match each
24	24	dollar invested by other investors in the fund after the total
25	25	amount invested by other investors reaches $500 million. The
26	26	comptroller may not invest under this subsection more than $500
27	27	million.
28	28	(d) In the year of investment, an individual investor in the
29	29	fund is entitled to an incentive in the amount of non-school ad
30	30	valorem taxes owed by the investor for that tax year, but not to
31	31	exceed the lesser of 20 percent of the amount invested in the fund
32	32	during that year, the total amount of non-school ad valorem taxes
33	33	owed by the investor for that tax year, or $3,000. The board of
34	34	trustees may give the investor the incentive amount in the form of a
35	35	cash payment from the fund or as additional shares in the fund, as
36	36	the investor chooses.
37	37	(e) The fund is managed by a board of trustees consisting of
38	38	nine members appointed by the governor.
39	39	(f) Each member of the board must have demonstrated
40	40	substantial investment expertise. Each member serves for a
41	41	six-year term expiring February 1 of an odd-numbered year.
42	42	(g) The governor shall designate a presiding officer from
43	43	among the members of the board of trustees who serves a term of two
44	44	years expiring February 1 of each odd-numbered year. A member may
45	45	serve more than one term as presiding officer.
46	46	(h) The board of trustees shall manage the fund, and may:
47	47	(1) employ and retain staff, including a chief
48	48	executive officer;
49	49	(2) take any action necessary for the creation,
50	50	administration, and protection of the fund;
51	51	(3) enter into investment contracts with investors;
52	52	(4) adopt rules regarding the operation of the fund;
53	53	(5) acquire, hold, and dispose of assets;
54	54	(6) execute contracts;
55	55	(7) pay expenses of the fund based on an assessment on
56	56	investor contributions;
57	57	(8) provide for different classes of voting and
58	58	non-voting shares; and
59	59	(9) alternatively, or in combination with its own
60	60	staff, contract for the management of investments under this
61	61	section with a private investment management firm or with an
62	62	investing fund or system electing a member of the board of trustees.
63	63	(i) The board of trustees shall appoint regional investment
64	64	boards. Each part of the state must be in the territory of one
65	65	regional investment board. Each regional investment board shall
66	66	evaluate potential investment opportunities in its region and make
67	67	investment decisions in its region. The board of trustees by a vote
68	68	of six members may override an investment decision of a regional
69	69	investment board.
70	70	(j) The fund may invest only in Texas businesses. The fund
71	71	may invest in publicly traded or closely held businesses.
72	72	(k) In making investments, the board of trustees and
73	73	regional investment boards shall exercise the judgment and care
74	74	under the circumstances then prevailing that persons of ordinary
75	75	prudence, discretion, and intelligence exercise in the management
76	76	of their own affairs, not in regard to speculation but in regard to
77	77	the permanent disposition of their funds, considering the probable
78	78	income as well as the probable safety of the capital of the fund.
79	79	(l) The board of trustees shall establish and operate the
80	80	fund to the extent practicable under the generally accepted
81	81	business procedures relating to a mutual fund and shall value the
82	82	investments for determining the purchase or sales price of
83	83	participating shares of investors in the fund consistent with
84	84	investment contracts. Evidences of participation in the fund shall
85	85	be held by the comptroller of public accounts in keeping with the
86	86	custodial responsibilities of that office.
87	87	(m) On a quarterly basis, the amount of income realized on
88	88	investments under this section shall be distributed to each of the
89	89	investors in the fund in proportion to the number of participating
90	90	shares of each investor. Capital appreciation becomes a part of the
91	91	corpus of the fund and shall be distributed in accordance with the
92	92	investment contracts.
93	93	(n) The board of trustees shall make arrangements to begin
94	94	liquidation, phase out investments, and return the principal and
95	95	capital gains on investments to the investors in the fund not later
96	96	than the 10th anniversary of the effective date of this section or
97	97	the date of extension of the fund, as applicable. Except under
98	98	unusual circumstances where it may be necessary to protect
99	99	investments previously made, further investments may not be made in
100	100	or by the fund after the 10th anniversary of the effective date of
101	101	this section or the date of extension of the fund, as applicable.
102	102	(o) At the regular legislative session next preceding the
103	103	10th anniversary of the effective date of this section or the date
104	104	of extension of the fund, as applicable, the legislature, by
105	105	two-thirds vote of each house, may extend the duration of the fund
106	106	for 10 years.
107	107	(p) The board of trustees may purchase liability insurance
108	108	for the coverage of the trustees, employees, and agents of the
109	109	board.
110	110	(q) Not later than December 1, 2014, the Sunset Advisory
111	111	Commission shall review the fund and issue a report to the
112	112	legislature.
113	113	(r) The board of directors shall make an annual report to the
114	114	legislature regarding the finances and operation of the fund.
115	115	(s) The comptroller may adopt rules governing the operation
116	116	of the fund.
117	117	SECTION 2. Not later than December 1, 2009, the governor
118	118	shall appoint the board of trustees of the Texas power source fund.
119	119	SECTION 3. This Act takes effect September 1, 2009.