Texas Education Code - Section 66.08. Investment Management
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§ 66.08. INVESTMENT MANAGEMENT. (a) The board may
delegate investment authority and contract for the investment of
the permanent university fund to the same extent as the governing
board of an institution of higher education with respect to an
institutional fund under Chapter 163, Property Code.
(b) The board may enter into a contract with a nonprofit
corporation for the corporation to invest funds under the control
and management of the board, including the permanent university
fund, as designated by the board. The corporation may not engage in
any business other than investing funds designated by the board
under the contract.
(c) The board must approve the:
(1) articles of incorporation and bylaws of the
corporation and any amendment to the articles of incorporation or
bylaws;
(2) investment policies of the corporation, including
changes to those policies;
(3) audit and ethics committee of the corporation;
and
(4) code of ethics of the corporation.
(d) The board of directors of the corporation shall have
nine members. The board shall appoint and remove all members of the
board of directors of the corporation. At least three members of
the board and the chancellor of The University of Texas System shall
be appointed as directors.
(e) The board shall select one or more of the members of the
board of directors of the corporation from a list of candidates with
substantial background and expertise in investments that is
submitted to the board by the board of regents of The Texas A&M
University System.
(f) If an investment contract entered into under Subsection
(b) includes the permanent university fund within the scope of
funds under the control and management of the board to be invested
by the corporation, the board shall provide for an annual financial
audit of the permanent university fund. The audit shall be
performed by the auditors of The University of Texas System and The
Texas A&M University System and presented to the board.
(g) The corporation shall file quarterly reports with the
board concerning matters required by the board.
(h) The corporation:
(1) is subject to the Texas Non-Profit Corporation Act
(Article 1396-1.01 et seq., Vernon's Texas Civil Statutes); and
(2) is subject to the provisions of Chapter 551,
Government Code (the open meetings law), that apply to the board of
regents of The University of Texas System, except that the board of
directors of the corporation:
(A) may discuss an investment or potential
investment with one or more employees of the corporation or with a
third party to the extent permitted to the board of trustees of the
Texas growth fund under Section 551.075, Government Code; and
(B) is not subject to Section 551.121 or Section
551.125, Government Code, rather any director of the corporation
may attend any meeting of the board of directors by telephone
conference call provided that the telephone conference is audible
to the public at the meeting location specified in the notice of the
meeting during each part of the meeting that is required to be open
to the public.
(i) The corporation may not enter into an agreement or
transaction with a:
(1) director, officer, or employee of the corporation
acting in other than an official capacity on behalf of the
corporation; or
(2) business entity in which a director, officer, or
employee of the corporation has an interest
(j) An agreement or transaction entered into in violation of
Subsection (i) is void.
(k) For purposes of this section, a person has an interest
in a business entity if:
(1) the person owns five percent or more of the voting
stock or shares of the business entity;
(2) the person owns five percent or more of the fair
market value of the business entity; or
(3) money received by the person from the business
entity exceeds five percent of the person's gross income for the
preceding calendar year.
(l) A former director of the corporation may not make any
communication to or appearance before a director, officer, or
employee of the corporation before the second anniversary of the
date an individual ceased to be a director of the corporation if the
communication or appearance is made:
(1) with the intent to influence; and
(2) on behalf of any person in connection with any
matter on which the person seeks action by the corporation.
(m) A former officer or employee of the corporation may not
represent any person or receive compensation for services rendered
on behalf of any person regarding a particular matter in which the
former officer or employee participated during the period of
service or employment with the corporation, either through personal
involvement or because the particular matter was within the
officer's or employee's responsibility.
(n) An individual who violates Subsection (l) or (m) commits
an offense. An offense under this subsection is a Class A
misdemeanor.
(o) In this section:
(1) "Board" means the board of regents of The
University of Texas System.
(2) "Governing board," "institutional fund," and
"institution of higher education" have the meanings assigned by
Chapter 163, Property Code.
(3) "Participated" means to have taken action as an
officer or employee through decision, approval, disapproval,
recommendation, giving advice, investigation, or similar action.
(4) "Particular matter" means a specific
investigation, application, request for a ruling or determination,
rulemaking proceeding, contract, claim, charge, accusation,
arrest, or judicial or other proceeding.
Added by Acts 1983, 68th Leg., p. 5100, ch. 926, § 2, eff. Aug.
29, 1983. Renumbered from V.T.C.A., Education Code § 66.06 by
Acts 1987, 70th Leg., ch. 167, § 5.01(a)(20), eff. Sept. 1, 1987.
Amended by Acts 1995, 74th Leg., ch. 213, § 3, eff. May 23, 1995;
Acts 1997, 75th Leg., ch. 19, § 1, eff. April 25, 1997; Acts
2001, 77th Leg., ch. 118, § 3.06, eff. Sept. 1, 2001.
Section: 65.46 66.01 66.02 66.04 66.05 66.06 66.07 66.08 66.09 66.21 66.22 66.23 66.24 66.25 66.41
Last modified: August 10, 2007
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