(a) The Texas Constitution, Article VII, §§1-8, establish the Available School Fund, the Texas Permanent School Fund (PSF), and the State Board of Education (SBOE) and specify the standard of care SBOE members must exercise in managing PSF assets. In addition, the constitution directs the legislature to establish suitable provisions for supporting and maintaining an efficient public free school system, defines the composition of the PSF and the Available School Fund, and requires the SBOE to set aside sufficient funds to provide free instructional materials for the use of children attending the public free schools of this state. The members of the SBOE serve as fiduciaries of the PSF.
(b) Pursuant to Texas Education Code, Chapter 43, Subchapter B, the SBOE delegated the authority to manage and invest the PSF to the Texas PSF Corporation, a special-purpose governmental corporation that is an instrumentality of the state of Texas with all necessary and implied powers to accomplish its purpose. The SBOE has the following duties and responsibilities with respect to the Texas PSF Corporation:
  (1) establish by rule the terms of the five members of the SBOE appointed to the Texas PSF Corporation Board of Directors;
  (2) adopt the certificate of formation for the Texas PSF Corporation;
  (3) approve the adoption and amendment of the Texas PSF Corporation bylaws; and
  (4) act as the sole member of the Texas PSF Corporation.

Source Note: The provisions of this §33.3 adopted to be effective March 1, 2023, 48 TexReg 1043