HBA-JEK C.S.S.B. 734 77(R)BILL ANALYSIS


Office of House Bill AnalysisC.S.S.B. 734
By: Duncan
Pensions & Investments
5/9/2001
Committee Report (Substituted)



BACKGROUND AND PURPOSE 

Currently, state entities that invest state treasury funds typically issue
an annual report regarding the performance of their funds.  C.S.S.B. 734
requires the Legislative Budget Board to publish an annual report on the
risk-adjusted performance of the state's major investment funds. 

RULEMAKING AUTHORITY

It is the opinion of the Office of House Bill Analysis that this bill does
not expressly delegate any additional rulemaking authority to a state
officer, department, agency, or institution. 

ANALYSIS

C.S.S.B. 734 amends the Government Code to require the Legislative Budget
Board (LBB) to evaluate and publish an annual report on the risk-adjusted
performance of each state investment fund that contains a relatively large
amount of assets belonging to or administered by the state.  The bill
requires the LBB in its report to compare the risk-adjusted performance of
the funds and to examine the performance of similar asset classes and
comparable portfolios within asset classes.  The bill requires each state
governmental entity or person that administers a state investment fund to
provide information the LBB requests regarding the performance of the fund.
The bill requires the LBB in its report to use terminology and a format
that a person without technical investment expertise can understand. 

EFFECTIVE DATE

On passage, or if the Act does not receive the necessary vote, the Act
takes effect September 1, 2001. 

COMPARISON OF ORIGINAL TO SUBSTITUTE

C.S.S.B. 734 differs from the original bill by specifying that the
Legislative Budget Board report on the performance of each state investment
fund is to be based on the risk-adjusted performance of each fund. The
substitute removes the provision that required the report to include
information on any advisors and advisory committees to state investment
funds.