Bill Text: TX HB855 | 2017-2018 | 85th Legislature | Engrossed

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Bill Title: Relating to the management and investment of the economic stabilization fund, including the determination of a sufficient balance within the economic stabilization fund.

Sponsorship: Moderate Partisan Bill (Republican 7-2)

Status: (Engrossed - Dead) 2017-05-19 - Left pending in committee [HB855 Detail]

Download: Texas-2017-HB855-Engrossed.html

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By: Capriglione, Goldman, Simmons, H.B. No. 855
Rodriguez of Bexar, Button, et al.

A BILL TO BE ENTITLED
AN ACT
relating to the management and investment of the economic
stabilization fund, including the determination of a sufficient
balance within the economic stabilization fund.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Sections 316.093(a), (b), and (f), Government
Code, are amended to read as follows:
(a) Before the comptroller makes transfers for a state
fiscal year in accordance with Section 49-g(c), Article III, Texas
Constitution, the comptroller shall determine whether the sum of
the balance of the fund on the preceding August 31, any projected
transfer to the fund under Section 49-g(b) of that article, and any
projected transfer to the fund under Section 49-g(c) of that
article in accordance with the allocations for the transfer as
provided by Section 49-g(c-1) of that article is less than the
sufficient balance adopted under Section 404.074 [316.092].
(b) If the sum described by Subsection (a) is less than the
sufficient balance adopted under Section 404.074 [316.092], the
comptroller shall reduce the allocation to the state highway fund
provided by Section 49-g(c), Article III, Texas Constitution, and
increase the allocation to the economic stabilization fund, in an
equal amount, until the sufficient balance adopted under Section
404.074 [316.092] is achieved.
(f) Subsections (a) and[,] (b)[, and (c)] and this
subsection expire December 31, 2024.
SECTION 2. The heading to Section 404.0241, Government
Code, is amended to read as follows:
Sec. 404.0241. COMPUTATION [INVESTMENT] OF [CERTAIN]
ECONOMIC STABILIZATION FUND BALANCE [BALANCES].
SECTION 3. Subchapter C, Chapter 404, Government Code, is
amended by adding Sections 404.0242 and 404.0243 to read as
follows:
Sec. 404.0242. MANAGEMENT AND INVESTMENT OF ECONOMIC
STABILIZATION FUND ACCOUNTS. (a) To manage economic stabilization
fund investments, the comptroller shall establish the following
accounts in the economic stabilization fund:
(1) the Texas stabilization account; and
(2) the Texas legacy account.
(b) In managing the assets of an account established under
this section, the comptroller, through procedures and subject to
restrictions the comptroller establishes for each account and in
amounts the comptroller considers appropriate for each account, may
acquire, exchange, sell, supervise, manage, or retain any kind of
investment that a prudent investor exercising reasonable care,
skill, and caution would acquire, exchange, sell, supervise,
manage, or retain in light of the purposes, terms, distribution
requirements, and other circumstances then prevailing for the
account, taking into consideration the investment of all the assets
of the account rather than a single investment.
(c) Section 404.024 does not apply to the investment of the
assets of an account established under this section.
Sec. 404.0243. INVESTMENT OBJECTIVES AND PURPOSES OF
ECONOMIC STABILIZATION FUND ACCOUNTS. (a) The investment
objectives and purposes of the Texas stabilization account in the
economic stabilization fund are to preserve:
(1) the account's principal;
(2) the purchasing power of the account's principal;
and
(3) the liquidity of the account.
(b) The investment objectives and purposes of the Texas
legacy account in the economic stabilization fund are to generate
earnings on the account's principal to:
(1) maintain the purchasing power of that principal
and if possible, increase that purchasing power; and
(2) provide for predictable and stable annual
earnings.
SECTION 4. Subchapter E, Chapter 404, Government Code, is
amended by adding Section 404.074 to read as follows:
Sec. 404.074. SUFFICIENT BALANCE OF TEXAS STABILIZATION
ACCOUNT. (a) For the purpose of making the transfers of money
required by Section 49-g, Article III, Texas Constitution, the
amount of the sufficient balance of the economic stabilization fund
is equal to seven percent of the certified general revenue-related
appropriations for the state fiscal biennium during which the
transfers are to be made.
(b) Except as provided by Subsection (c), the comptroller
shall allocate and, at the time and in the manner that minimizes
losses and penalties, adjust the allocation of the economic
stabilization fund between the Texas stabilization account and the
Texas legacy account to:
(1) maintain a balance in the Texas stabilization
account equal to the sufficient balance of the economic
stabilization fund; and
(2) allocate the remainder of the economic
stabilization fund balance to the Texas legacy account.
(c) If the legislature appropriates money from the Texas
stabilization account and, as a result of that appropriation, the
account balance is less than the sufficient balance of the economic
stabilization fund, the comptroller may not adjust the allocation
of the economic stabilization fund balance to allocate an amount to
the Texas stabilization account to achieve a balance in that
account equal to the sufficient balance.
SECTION 5. The following provisions of the Government Code
are repealed:
(1) Section 316.091;
(2) Section 316.092;
(3) Section 316.093(c); and
(4) Sections 404.0241(a), (b), and (d).
SECTION 6. This Act takes effect September 1, 2017.