Texas Permanent School Fund
|United States – Texas||US$ 25.5 Billion|
Transparency Rating: 9
Firm Investment Style: Mixed
Entity Structure: Fund
Created by a legislative body in 1854, the Texas Permanent School Fund was initially funded by an appropriation of US$ 2 million. The money was to be for the benefit of public schools in Texas. The funds were available as an outcome of a US$ 10 million dollar payment from the U.S. government in exchange for giving up claims to western lands claimed by the former Republic of Texas.
Fast forward to 1953 when the U.S. Congress passed the Submerged Lands Acts that relinquished to coastal States all rights of the U.S. navigable waters within state boundaries. A key source of funding for the fund is its investment returns and oil, gas and mineral royalty payments and leases from the land.
|Strategy & Objectives
The State of Texas (State) Constitution describes the Fund as “permanent” and “perpetual” with proceeds produced by the Fund to be used to complement taxes in financing public education. Under an obligation to maintain trust principal, the Fund’s assets are held in a trustee capacity for the benefit of public free schools. The annual distribution provided by the Fund is calculated using a total return methodology.
Some of their asset allocation consists of: