Approved Legislation Would Change Education Fund Investment Strategy
Austin - At the request of Austin Senator Gonzalo Barrientos, the Senate unanimously voted to suspend the rules dictating attire today in order to allow his honored guest to appear on the Senate floor. Legendary country singer and activist Willie Hugh Nelson stood before the chamber in his customary jeans and tee-shirt, with his cowboy hat in hand. Barrientos, along with several other Senators, spoke on Senate Resolution (SR) 776, and wished the man, often referred to as "the red-headed stranger", a happy 70th birthday. "He is a true legend, a Texas man, and a caballero," said Barrientos.
The Senate passed legislation by a 27-1 vote that would let voters decide whether to change the investment strategy of the Permanent School Fund (PSF), a critical source of revenue for school children in Texas. Some of the income derived from its investments is distributed to the Available School Fund (ASF) to pay for textbooks and other materials.
The PSF currently uses an income-based investment strategy that allows only interest and dividend income to be spent, while any earnings from increased stock value must be retained in the base of the fund. Under the proposed total return strategy, part of the money earned from stock appreciation, known as the capital gains, could be spent as well.
Sponsor of the legislation, Houston Senator Rodney Ellis, claims that the current income-based strategy "is not keeping up" and that most similar funds around the country operate in a total-return basis. According to Ellis, a shift in investment strategy could generate $535 million in additional funding for the ASF over the next biennium.
Lieutenant Governor David Dewhurst expressed his support for Senate Bill (SB) 206 and Senate Joint Resolution (SJR) 13. Dewhurst called the two pieces of legislation a very good and safe way to be able to provide more funding for public education by going to a rate of return on our PSF.
Another resolution, in honor of Mother's Day this weekend, was also approved by the Senate today. The four female Senators all spoke on SR 792, which pays tribute to all the mothers of Texas. "Please do not forget--go buy a gift," Plano Senator Florence Shapiro reminded her male colleagues.
The Senate will reconvene Monday, May 12, 2003, at 1:30 p.m.