'25. We'll go ahead and start in here at 9AM with our first agenda item for the day. That's proposed new 19 TAC chapter 127, teach for career development and CTE. Jessica from the agency's bureau briefest. I'll hand it over to her at this time. Good morning. This is an item, proposed new rules that would add CTE TEKS, for seven courses. These courses were developed by subject matter experts that were convened by two contractors, Texas State Technical College, TSGC, and educational service center, ESE region four.
These courses are needed to complete programs of study. To give you some background in these courses, back in April 2024, we had presented, with our colleagues, that support the EMR process, some of the upcoming, interrelated needs for course development, as well as instruction material adoption to support, the programs of study as a result of the recent program of study refresh that had occurred. As a part of that process, there were a number of courses that were identified that were needed to complete those programs of study. And, at that meeting,
we discussed some of the options for some alternative processes to build capacity to support that course development process. At the June 2024 meeting, the board authorized TEA to enter into these interagency contracts with three contractors that included Collin College, tech Texas State Technical College, and region four. These, so after that meeting, we executed those contracts. That course development began. And then you may recall at your January meeting in 2025 this year,
we brought you a set of those courses for discussion. We wanted to make sure we were on the right track for those courses and had good drafts to move forward with. We did not bring the courses to you for first reading in April. You had a number of other TEKS related items on that agenda, and so we're bringing those courses to you now for first reading and filing authorization. Again, the set of courses before you, there are seven courses from three, career clusters, business, finance, and marketing, health science, and manufacturing. Happy to answer any questions you have about the courses or the process at this
time. Yeah. Thank you, Jessica. One thing I would add is that if we look back I think if we go back about a year and a half, we had a discussion about all the work on CTE that we needed to do. I believe it was around four hundred courses or something like that we needed to work on. And so we made a we had a discussion twice about the process that you're talking about to, essentially try to smooth some of this out. I believe I called it the peanut butter spread method a few times on the record. And one of the methods that we discussed doing was to contract these two organizations.
I know there's some questions process wise. So I want to take those questions first, then we'll get the main motion on the floor for discussion. Member Brooks? Yes. Thank you. So, yes, I was wondering, with that meeting that we had, it was a discussion on how to move forward with the interagency partnership. But there was nothing else to follow-up with that. So contracts, that sort of information, there was just not a follow-up meeting on that? We actually discussed the item across at least two meetings. As, board,
chair Kinsey indicated, the conversation, I believe, began at your April meeting. And then at the June meeting, the board authorized TEA to move forward with the three interagency contracts. So I looked that those meetings up. I didn't see that second meeting. So January of this year was the first time that I saw January was when we brought the courses that had been developed, for discussion as a part of the IACs, which is just shorthand for interagency contract. It is I'd be happy to share them with you. We have minutes from the April meeting and the June meeting in 2024 when the
discussions about these processes, took place. Right. I would because I I tried to look that information up, and all that I find was the discussion of it in January about the possibility of of of going into partnership. My point is this. I would just like that information of what that contract is, what that pricing looks like. Just felt like blinded to the whole process, if you will. I did look at the the the ticks and, you know, and I did research on that. Those those look really good,
but I do like transparency. That's just my takeaway from this whole process is a discussion is you come back with the information, and then we move forward with what action to take from there. But thank you for answering my questions this morning. You can share that information with you. Thank you. Any further process questions or comments? Vice Chair Little? Mr. Chair, I move that we approve for first reading and filing authorization proposed new 19 TAC Chapter 127, Texas Essential Knowledge and Skills for Career Development and Career and Technical Education, Subchapter F,
Business, Marketing and Finance Subchapter J, Health Science and Subchapter O, Manufacturing. We have a motion. Do we have a second? Second. We have a motion and a second from Doctor. Clark. We'll take the public testimony at this time. K. We have two registrants for item number one, Lavanda Loney and Gina Zinner. Are you here? Public testimony is limited to two minutes per speaker. You will hear a countdown at one minute and a second at your two minute. Please end your testimony at two minutes. If you have copies of your testimony,
please provide that to the staff when you're about to speak. Thank you. Levon Deloney? Your time has started. Good morning, members of the board. My name is Doctor. Lavanda Loney, and I am a Texas Educational Policy Institute fellow and an educational leader deeply committed to preparing Texas students for real world success through high quality career and technical education. Thank you for the opportunity to testify on the proposed CTE text revisions. First, I want to commend the board and the TEA staff for the structured, forward thinking review processes that has unfolded since 2022.
The revised TICS reflect on strong commitment to aligning career clusters with labor market demands and ensuring equitable access to relevant coursework across the state. As you move forward to final adoption and implementation, I urge you to consider three critical areas. Equitable implementation and support. This is where we'll need to be able to give PD to all of our districts. And we know that funding and targeted PD to train teachers is going to be at the utmost importance. Secondly, industry responsiveness. We must ensure that our takes remain agile as industry standards shift,
particularly in STEM, manufacturing, and health science fields. I encourage the board to consider a mechanism for annual input for businesses, higher education, and regional workforce leaders to keep the programs of study responsive and future ready. And finally, clarity and communication. With multiple revisions adopted over the last five years, districts face challenges navigating these changes. A centralized TEA platform that highlights major updates, course impacts, and best practices resources will help educators to adapt more effectively and confidently.
In closing, I am commenting on the intent and the direction for the CTE text updates. Let's ensure that we are just as intentional about preparing the educators who will bring these standards to life. Thank you for your leadership and the opportunity to speak on the behalf of students, teachers, and school leaders. Okay. Member Brooks. Thank you. So in response to that TEA, I have a quick question in response to, Doctor. Loney's testimony. Okay. What can can staff do? Because I I do agree for staff.
Yeah. So I I do agree wholeheartedly with the clarity and communication number three, that she, spoke on in her testimony with multiple revisions adopted over the last five years. Districts face challenges navigating changes, the centralized CEA platform, highlighting major updates, course impacts and best practice resources. How could the TEA agency incorporate something like this to make it user friendly for teachers? Because I agree that this is a a missing element that would help teachers. So the number of courses, I think,
are in part in relation to completing the programs of study. So there's been a lot of front end work to support the new programs of study that were first implemented, I think, in 2122. I might be one year off there. So I I do think that you will see that number of CTE courses at some point decrease, once these programs of study have been completed. So I just wanna start with, that's in part been the number of courses. As chair Kinsey mentioned, there were a number of courses that needed to be developed and revised to support the programs of study. In general, each time we have a new review and revision of TEKS,
we share that information with the, ESEs. They're a part of the feedback process, as well as have open to public comment, and share that information through our newsletters. And once the TEKS are adopted, we also share that information so that districts and educators have time to prepare for the new standards. Our CTE team can speak a little bit better than I can, to some of the other additional supports that they provide to districts, in preparation of implementation of new programs and study antiques. So be happy to get more information for you about what that looks like.
Yeah. I I think just what I'm I'm looking for is, you know, a centralized TEA platform. Maybe just exploring what that might look like. Maybe just TEA could possibly look into, something just to add to what we already have online. But with so many, you know, different courses, I I do think that this would help organize all the information and highlight major updates even though I don't think we update a course as often as we would at, let's say, a foundation. But, maybe just looking into something like this. We could explore those options.
Thank you. Thank you. Mr. Chairman. Governor Maynard. And I would just also remind folks is that each one of these CTE disciplinaries have a professional development conference over the summertime. And so there's the professional associations do quite a bit of work in this area as well. Member Hickman? I have a follow-up question for Member Brooks. And if I look on top of page I-five, it says at least it says the prerequisites in B, at least one credit in a level two or higher course from business marketing, finance,
career cluster. So I'm just curious how many business courses are there that we've done? And then if you're at x y z high school, how many courses are they gonna offer, and how many of these pathways, do the students have access to? I have some folks in the room who might be checking those numbers for me. I do not have them top of mind. Okay. I am navigating to our programs of study web page where, I can share with you the number rather relatively quickly the number of programs of
study that we have in business. Business is combined now into a single career cluster with finance and marketing. So it's the business marketing and finance, career cluster. There are six programs of study, the number of courses I'll need to get back to you. So the other part of that is I can't imagine any high school offering all these courses. So how do high schools pick them, and what if a student's interested in something that's not offered? Kind of how does that work? It will vary. Monica's gonna step up and talk to you more. The CTE team is under her direction.
So first, I just wanted to mention in terms of courses, the way the programs are of study are set up is that there are multiple courses for each level so that there are options. School districts are required to offer a certain number of programs of study, and that depends on the size of the district. So smaller districts would not be required to offer as many programs of study as, let's say, a Houston ISD or a Dallas ISD. And that's actually something that is in your rules. That was a conversation that we had with the board.
Science courses. Similar to that. Yes. So there there's a minimum expectation for the number of programs of study. As part of the Perkins state plan and the requirements that districts have to implement Perkins, there is an expectation that they are using labor market information to make decisions about course offerings. And so there is information that is provided to them, and then they complete what is called a comprehensive local needs assessment on an annual basis as part of their Perkins grant application where they identify how they're using that
labor market information to make decisions about course offerings. Just this past year, the commissioner, when he toured the state to, present to superintendents at each of the regional education service centers, he focused on CTE, and we spent time really talking with superintendents about about the, variety of resources that are available for that, meaningful decision making in terms of what, courses are going to offer. I will mention that one of the, biggest barriers that we hear is identifying staffing to teach the courses that districts may
wanna offer students may be interested in. The legislature has taken some steps to increase flexibility to help with, the the teacher resource issue. There is a new program called, RPEP where, regional, small districts, it has to include at least one district of 1,600 or fewer can, partner to essentially shared services. So if there are three districts and each of the three districts offer, two programs of study but their students have access to all of them, then that triples the number of options available to students.
The last thing that I'll mention is that we have worked, to leverage the Texas Virtual School Network, the statewide course catalog, to, focus, heavily on CTE courses to give district students in districts that don't have as many offerings more opportunity to take courses that their district might not offer through the statewide course catalog. So that is just virtual course? Virtual courses. Yes, sir. Alright. Great. Thank you. Any further questions, members? We're gonna start going through them? Okay. We'll just do like we've been doing.
We'll just walk through them section by section, and then we'll keep it open and come back and catch anything at the end. We'll start with, subchapter f. Member Brooks. Thank you, Mr. Chairman. My question is on I-five. Can staff show us how you the changes you made with the employability skills? How does this whole document look different, as a result of that? Where is it located? And and and I have another question specific to language after you answer that question. Sure. So this language is almost identical in all of the CTE courses that you just
adopted in April of this year, under implementation. So if you're on I dash five, the very top of the course commercial lending and real estate, subsection a, implementation number two is where you'll find the employability skills reference. Just one moment. Could you repeat that really quick? I just It's up at the top, subsection a, so lowercase a Mhmm. Implementation, and follow down to paragraph two, the number two. Mhmm. And you'll find the employability skills language there. It it is a cross reference to the section of the administrative code where those
employability skills will be codified. Mhmm. The difference is that there is different language for level one and two and for level three and four. And so the only difference between this language between courses is what the cross what the cross references to. Is it to the level one and two's employability skills, or is it to the employability skills for levels three and four? Okay. So, specifically thank you. Number one. So c one. Is this new language career and technical, or was this here previously, this entire part? So this is a new course,
but I can speak to the introduction. Are your CTE courses all follow the same structure in the introduction, and they all have the first the same first paragraph number one, which is a broad statement about career and technical education. So this paragraph one The same. Of the inter is the same across all of your CTE courses. And number what else? Number two is the same in that all of your courses will have a description of the career cluster in which that course is located. So in this example, it is a paragraph describing the business marketing and finance career cluster.
So paragraph two is identical in all business marketing and finance career cluster courses. Okay. But it would vary if it were, for example, an agriculture course. It would have a different paragraph number two. Okay. And number three, could you Number three, again, structurally is always the same. This is the course description. So it will vary by course, but what will be consistent is paragraph three will always be a course description. Okay. And four? Four is consistent language across all of the courses. It's a statement about student participation and extending learning experiences.
And five? Five is the same in almost all of your TEKS. Yeah. Both non CTE and CTE. It's an explanation of the meaning of including and such as statements. D, knowledge and skills five d, this part? D is it will depend on how many subsections there are. But once you get to the subsection that is knowledge and skills, that's where, your knowledge and skill statements and student expectations begin. It is usually d and a course, but not always where your knowledge and skills start. So my question in in this regard is so looking at the knowledge and skills
part, this should tie into the three, the description. Correct? It ties into three in that paragraph three in the introduction is a course description for this course. So the knowledge and skills and student expectations that follow should be support, the the course description. And and that's the that's for all throughout. Correct? Correct. Okay. Thank you. Yes, ma'am. Member Hickman. Thank you, chair. I have some questions for staff on health science and manufacturing. Do you want me to hold those until we get there and deal with amendments in this section first?
Yeah, let's just deal with the amendments. We can get some one on amendments for Subchapter F. I do have two, if I can. Mr. Chair, I move that we insert the words origination costs and a comma in 6B on page I-six. Okay. We have a motion. Do we have a second? Second. We have a motion and a second from Member Brooks. Would you like to speak to it? It's just another part of the loan terms that I thought we should include. Any discussion? You said six b? Six b. Yeah. It's talking about different loan terms.
I'm sorry. Just Page I dash six? Yeah. After after after what? After loan to value ratio. Oh. And I've got it up on the screen now. I apologize. Of course you do. I'm sorry. My apologies. That's the chair's phone. Any discussion? Any objection? Seeing none, it passes. Member Hagel? One more, Mr. Chairman. 8C on page I-seven. After evaluate the role of loan covenants, insert, comma, personal guarantees, comma. Okay. We have a motion to have a second. Second. Motion to second from member Pickering. Would you like to speak to it?
Sure. This is something I actually deal with all the time is, you're not sure on the credit of your borrower and you want someone to kind of cosign just in case the borrower fails. Is there any debate? Okay. Is there any objection? Seeing none, it's adopted. Is there any further on this section? Subchapter F. Member Pickering. Yes, Mr. Chairman. I have two on page I6 under number five. It will be a new five c. Microphone, please, number picker. It will be a new can you hear me? Barely. Barely.
Barely. Okay. It will be a new five c. I believe miss Kaye has it. Explain that Just yeah. I just got it. Okay. It'll say, explain the difference between surface rights and mineral rights and how they relate to commercial real estate projects. Texas is a one of a handful of states where you can sell what's above the earth different from what you sell what's below the earth. So our kids need to understand that. Second. We have a motion and a second. I'll give, Kaye a second to get it on the screen. Okay. Member Pickering's amendment's depicted on the screen.
Is there any discussion? Just Member Perez Diaz. Thank you. Just needing some clarification. This it looks like what we were handed is not a replacement of c, but an addition of c and then moving c to d, d to e. Is that correct? There is no d to e to yes. Moving relevering existing c. Oh, okay. There were only a, b, c. Oh, I'm so sorry. C and move the c to d. I'm so sorry. I misread this. Thank you. Is there any further discussion? Is there any objection? Seeing none, it passes. Member Pickering? Yes, mister chairman.
I have an additional one. It will would occur on page I seven, and it would be a new 13 in the vein of entrepreneurship, throughout our CTE courses. The new student expectation would be a new number 13 that says the student explores entrepreneurship opportunities and commercial lending and real estate. And then a would be research and identify requirements for owning and operating a mortgage firm, and b would be research and identify requirements for owning and operating a commercial real estate agency. Okay. We have a motion. Do we have a second? Second from member Hall. Would you like to speak to it?
Member Pickering, would you like to speak to it? Yes, sir. Just, not to be redundant, but just to say, you know, we're encouraging entrepreneurship, small businesses, the backbone of the Texas economy, and we want our kids to own businesses. So just want them to know that there's a path for them to own their own mortgage company or a path for them to own their own real estate agency. Okay. I have a question about it, the language. So identify requirements, what type of requirements are you thinking about? Well, because if you own your own mortgage company, there's SEC filings that have to happen, certifications and filings that have to happen. And then also on the real estate agency,
there are specific trainings to be a broker that have to happen and licensed by the state. So it's just kind of doing a, you know, not a deep dive, but kind of a brief overview. If you wanna own your own real estate agency or you wanna own your own mortgage firm, this is kind of what you need to look into. Yeah. I I was thinking about the same thing. And I guess my question is for Jessica. In A, she's talking about a heavily regulated industry and said, do we need to call out those regulations? I don't think we want, our students failing to identify all the things you would need to do this, but then going and launching a career in it that that wouldn't work out.
And the same thing on b. Am I overthinking this? I think just by stating requirements, the educator can select the requirements that they wanted to cover with the student. One option to narrow a student expectation, if that's where you're headed, is to add an including or such as statement if you wanted to including licensing requirements. You could narrow the scope if that's the direction you're heading. Mister chair? The direction I'm wanting to head is not to teach students that they can own a mortgage firm without getting proper SEC regulatory approval and all the things that you
have to have. So if I'm overthinking it, that's fine. I'm just a question. Member Hickman? I do not own a mortgage firm, but I don't think that's very entry level. I would offer a secondary amendment for owning and operating a commercial property. I would think a commercial property or a real estate agency is more kind of an entry level entree into commercial lending and property ownership. Mortgage firm and insert commercial property. So we have secondary, well, we have an amendment. Secondary amendment. We have a second from Doctor.
Clark. Would you like to speak on it? Yeah. I have several friends who own commercial properties. I don't think I know a single individual who would own a mortgage firm. I see those as more big companies, banks. It's large, complicated, regulated, I think where you were going, Mr. Chair. If we're trying to get students to dream about businesses they could start, own and operate, I would start with a commercial property rather than a mortgage. Member Baker? Yes, sir. So, mister chairman, I stand in opposition to this because, I do have friends who own mortgage companies,
and I do have friends that own commercial real estate agencies. And I think that our kids, if taught the opportunities, that, they too can easily own a mortgage company. They just need to this falls under, for me, falls under the category of dreaming big. We need to teach our kids that they can own their own businesses and that it's not just up to the to the, you know, five major banks to run mortgages in Texas. Lots of people own mortgage farms, small mortgage, houses. So, and then also member Hickman's rewrite of this for commercial property, that's already covered in the beginning of this.
So I'm not that seems pretty redundant that we're gonna teach them owning and operating commercial property when almost the entire first section is about that. You know, one way to solve this is to create a c and have a separate one. But I'll let the board decide that. Member Childs? I have a question for staff. Is there a way to get at exposing the kids to knowing that they can own a firm without getting into the weeds as to how or the requirements? Just exposing them to the fact that they can do it? I think I think there is.
We might bring something to you for your Friday meeting to to work on that. That might take a little bit more spot. I was going to offer to chair Kinsey when you were talking about the requirements, that perhaps insertion of the word legal, might help get at what you're getting at. So it would read research and identify legal requirements for owning and operating a mortgage a mortgage firm. So I wanted to, provide that suggestion to see if that helps where you were going. To your point, we could certainly work on something that was more of, I think you said, general general understanding the types of or that entrepreneurial,
opportunities exist in the industry. Member Hickman? Question for staff. Is this course focused only on commercial property and commercial lending or is it also personal individual? It is. The title of the course is commercial lending and real estate. So that is the focus. There are other real estate courses in this program of study, but this particular course is is focused on the commercial lending aspect. Okay. So, again, in favor of my amendment, what I would suggest is that a mortgage firm that works in residential could be
smaller and more of a start up commercial. I think of much larger properties, larger values, much more startup costs, more capital required. I don't see that as a good entry point into the market. I also wanna mention, Monica has wisely reminded me that this is first reading and filing authorization. We'll opt in on second reading, bring something on a Friday, but there's opportunity to work on amendments. We'd be happy to work with any board members. Or if you wish to do so between now and second reading and final adoption, you have that opportunity. Yes. We have three more opportunities. Friday, next time during the week,
and then on Friday of, September as well. That's correct. Member Pickering. Mister chairman, in the commercial lending space, there are a lot of people, a lot of Texans, a lot of people actually around the nation, that have commercial portfolios made up of residential properties, myself included. I bought my first property when I was 20 years old. So that's, that's not true that only the big banks can operate in the commercial space. There are several boutique firms that operate in the commercial space. Member Heckman? I think member Pickerin is speaking in favor of the amendment as she owns and
operates commercial properties. No, sir. I am not because that undoes the meaning of a. A is about mortgage firms. It is not about commercial properties. If member Hickman would like to add a c, I will be in favor of adding a c. But I'm not in favor of changing of, I'm not in favor of telling our students or not educating our students on how to earn how to own a mortgage firm. Okay. So if the amendment fails, you're gonna offer a c for what member Hickman is proposing? I'm sorry. Say that one more time,
mister chairman. I said if the amendment fails, it sounds like you're planning to offer an amendment c of exactly what member Hickman's. Yes, Mr. Chairman. Thank you. Any further discussion? Ready to vote? All those in favor of member Hickman's secondary amendment, please show by raising your hand. Two, three. Thank you. All those opposed, please show by raising your hand. Seven three seven, the secondary amendment fails. Member Pickering, would you like to make a motion? Yes, sir. I'd like to make a motion to add a c. And the c would be in the same language research and identify requirements for owning
and operating a commercial real estate portfolio. Does that get where you want to go, mister Hickman? I would start with property rather than portfolio. That's that's how you build to a portfolio. I'll accept that, mister chairman. K. Thank you. K. We have a motion from member Pickering. Do we have a second? I'll second. And a second from member Childs. Would you like to speak to it anymore? No thank you, mister chairman. Okay. Is there further discussion? Is there any objection? Seeing none, it passes. Anything further for subchapter F?
Chairman. Member Maynard. Mr. Chair. Yes. Miss Pickren made an original motion to add a and b that I don't believe was voted on. Oh. Then she's introduced what I believe would have been a secondary amendment, but I'm not sure she can do that to her own amendment. So okay. Then I do think you need to go back to And vote on the whole thing. First and vote on for a and b. Okay. So now we're gonna vote on everything in red. Thank you. Speeding out the gate here on item number one. Is there any objection to the amendments offered by member Pickering in red depicted at
13 on screen? Seeing none, it carries. Was that objection? I have a question for staff. Okay. I'll come back to you in just a second. I got Member Maynard and then back to you, Member Hammond. Mr. Chairman, page i-seven. Under 12, this is the section related to career opportunities in commercial lending and real estate. And I would move to move an amendment to insert after loan officers and before underwriters real estate appraisers. And that's in A and then also insert real estate appraisers at for loan officers in
B. Got a motion by Member Mahindra, second by Vice Chair Little. Would you like to speak to it? No, that's, we run an appraisal company. So I think that's a pretty big miss there when we talk about careers and not including the appraisal part of that. Is there any discussion on this? Is there any objection? Seeing none, it carries. Do you have more amendments, member Rainer? Member Hickman? Staff, were you bringing back some suggestions on the type of requirements for operating a mortgage firm on Friday? I believe what miss Childs requested was potentially some language about opportunities and entrepreneurial opportunities.
So I I did not understand that you're asking for different types of requirements. We can certainly do that as well. I've made one suggestion on the previous, set of student expectations if you wanna focus on legal requirements, licensing requirements. If you would like to make that request, we'd be happy to work with you. Yeah. I have a laundry list of acronyms I can give you. Okay. Thank you. Doctor Bill Monroe. Good morning. Good morning. I think that, including a loan officers, should have an and rather than a comma, and then or, you know, loan officers or real estate appraisers.
No. Those are two. Just a a grammatical correction. This is serious. Say what you're trying to do again. In in in a, the second line, including loan officers or real estate appraisers rather than a comma? Because a comma would indicate a series of more than two. Oh, I think it is a series of more than two because then you have underwriters, real estate analysts, and developers. So thank you. I apologize. Yes, you're right. And now five with the amendment. You're right. Is that Oxford comma? I love the Oxford comma. Thank you, Doctor. Beauvoir. Mr. Chairman?
Member Mainers? Just a question for staff. What other related courses do we have just in terms of I think that it would be really when we think about this between now and our next meeting and maybe to see this course in the context of the other courses just in terms of what other knowledge and skills being taught related to this? Be happy to share with you what we call the program of study framework, which lists these courses that are within that program of study as well as indicates their levels. Just to give you a couple of examples, in the real estate,
there's a fundamentals of real estate course. There's an insurance operations. They're a a principles course. There's also some interior design courses, as well as marketing courses that students could take towards this program of studying real estate. But I would say the foundational courses before this is fundamentals of real estate. Yeah. And so and and this is this is to flesh out a a program of study? Correct. The program of study is real estate. And then a student at level four has a couple of different options. They could go for a practicum in real estate,
or they could take this commercial lending and real estate course, which is a level four course or both. Okay. Alright. Thank you. Vice Chair Little. I have a question for member, Hickman. Mr. Hickman? Yes. Back there where you inserted, personal guarantees, what is the difference between a personal guarantee and a cosigner? Do we have the terminology cosigner in there? I I deal with guarantees on a corporate. So it's personal though and cosigner I'd say would be the same. But we can I would probably disagree? Okay.
I think personal guarantee is that the person who's taking out the loan guaranteeing it themselves. I agree with that definition of it. And I think we should add cosigner in there because to me, those are two different things. I would agree with that. Would you like to make that motion? Can you tell me which one of the, one of the tics it was that you were changing? I didn't Right. On the screen. See. Right here on the screen. Yes. I would like to amend c that we, have personal guarantees, and after that, add cosigners. Second. Motion and second from member of Ellis. Would you like to speak to it?
No. I think it's self explanatory. Is there any discussion? Is there any objection? Seeing none, it carries. Any further amendments? I think, member Ravel has seconded that. Yeah. It was. Anything else in this course? Alright. Moving to Jay. Mister chair. Member Brooks. Thank you, mister chair. Good morning. Hi, mister Scott. For this section, I would really welcome the ideas of of TEA, on this, some of the suggestions that I wanna make today on this. So, I wanted to go to I8 at the bottom, five one.
The student researches the history of medicine and pharmacy, sorry, one a. I move to amend, move to amend this to to state the following. Identify, I'd like to strike out ancient, and and put in place of it popular. Identify popular beliefs associated with illness and medicine from April through AD sixteen hundred. I'm sorry. I'm on I eight at the very bottom, knowledge and skills, one a. So I just would like to move to strike out ancient and put in their
popular beliefs. Okay. We have a motion. Do we have a second? Second. And a second from Member Hall. Would you like to speak to Member Brooks? To make it more concrete and succinct, popular beliefs, because ancient beliefs can, it would it would not relate to AD 1600. And, and it can go into to other aspects, I think, in a classroom setting. So, popular beliefs, it would just single out what were some of the popular beliefs associated with illness and medicine, sticking more to what the, the goals state in in item three,
the description of what this course entails. So to stay true to that and to keep it, teacher friendly, class friendly, I would just think that popular would be more fitting than ancient there. Vice chair. Seems to me that since we have the time frame identified, April April through AD sixteen hundred, to me, that is an ancient time. And if you use the word popular, to me, that means something current. Yes. Because it does go into current. So ancient wouldn't refer to AD sixteen hundred either.
So is there I'm I would welcome a different word there that would apply to both. How about beliefs with no adjective? Yeah. Just take the word ancient out maybe, but just beliefs associated with medicine from April through AD. Yes. 1600. Would you like to restate your I would like to restate my amendment, please. Please. I would move to, remove my prior amendment to the following. Strike out ancient and just continue with identify beliefs associated with illness and medicine.
Is there any objection to Member Brooks' restatement of her amendment? Seeing none, it's restated. I have another. Oh. Is there any further discussion on it? Member shots? I think I understand what you're trying to do here, but aren't we taking away an opportunity for the students to be exposed to vocabulary by taking out the word ancient? That would be true if it were an English course. I just think given that it's it's not that that wouldn't be the priority for this. But that's I'm too agree there's always a priority to expose students to vocabulary every course? Yes. But in this context,
is the simplest and most succinct way for a teacher to to teach this tea, is my opinion. Okay. Is there any further discussion? All those in favor of member Brooks' amendment, please say aye. Aye. All those opposed, no. No. Ayes have it. The amendment carries. Do you have further amendments, Ms. Brooks? Yes, thank you, Mr. Chair. So on page I9, or roman numeral one nine, I guess, the the problem surrounding, for b, I moved to okay. So one b, forgive me. So one b. I move to strike out the word describe and replace it with the word compare.
We have a motion or a second. A second from Doctor. Park. Should I speak to it, Monroe Brooks? No, just a different verb here where because they are going to be exposed to different treatments. But I believe that in order to go into a higher level of thinking, comparing what you have learned with those treatments would be a suitable verb here. So comparing what would be just a higher level of thinking as opposed to just writing out the difference, the or writing out the treatment. Okay. Is there further discussion? Yes. Member Perez Diaz.
Thank you, Chairman. So, I think the change in this language, it does shift the intent of this, particular tick. And so I'm wondering Okay. What the implications for that are. And then for consistency's sake, does this language appear other elsewhere? I don't think there would be any conflicts with any other student expectations or elsewhere. Compare is considered to be a higher level verb, than describe. I think in that comparison, students would need to describe the treatments, and then they would go an additional step to talk about how they're different. So how an herbal remedy that,
versus something that that is concrete and an actual treatment or, substance versus a supernatural, which okay. It's not. Okay. Thank you. Any more discussion? Okay. All those in favor of member Brooks, amendment, B to to, letter b on the screen, please show by raising your hand. Three. Thank you. All those opposed, please show by raising your hand. Seven thirty seven, the amendment fails. Do you have further amendments been for? Yes. Yeah. Please. Thank you. So, I move to amend, striking out and supernatural explanations. Where is that?
N b? N b. Yes. One b. Same sentence, same line. Okay. We have a motion. Do we have a second? Okay. The motion dies for lack of a second. Do you have further motions? Yes. Please. Same line, same sentence. I move to strike out prior to the enlightenment period. To read as follows, they were commonly practiced. So it would be compare treatments, including herbal remedies and supernatural explanations that were commonly practiced in Western civilization and k. We have a motion. Do we have a second? K. Hearing none,
the motion dies for lack of a second. Do you have further motions? I do. One last one on this page, was to include a a new teak here in this area, as follows to read as follows. So it would be as Who's that? It's a d? A one d. Okay. A one d. And this is where I would like staff help is and really just discussion, if you will. Just, my, recommendation is to include opiates here. The white use of opiates and problems surrounding its usage,
and the effects of opiates on the nervous system. So that's kind of the spirit of what I wanted to add here because this is an ethical issue. And in in spirit of the description of the course oh, it didn't ask me to say Miss Brooks, because this knowledge And skill statement is about the history of medicine and pharmacy and how it difference differs from modern practices. There might be a better place for a student expectation on, opiate opiates. And so I might ask if we could work with you,
on a potential student expectation. Yes. So in in in and and along those lines, I was thinking maybe starting with opium because it started with opium and then I see. So I could look at the history of kinda how it started and where we are with that. And that was the idea I was getting to as far as the historical part of it. Can I make a suggestion? Yes. We're gonna keep going through several more courses. And And even today, you could work with staff here before we come back and come back to the beginning of the courses and see if we can come up with an amendment then.
So you probably have thirty plus minutes. Thank you. Happy to take that. So if we work it out. Thank you. Do you have further amendments? No. Member Hickman? Couple questions if I can first, sir. Sure. Nine b on the top of page I 11. So it's define OSHA requirements, define, define, then e is describe and f is explain. D says identify, handle, dispense, and safely dispose of hazardous medications and materials. So is the intent for the students to actually physically handle, the materials? No. I don't think it would be particularly because,
this is an introduction. I think we could give me just a moment. Identify requirements of handling How or how to. Mhmm. Okay. If you could help on that one. That one just stuck out to me. But I do have some amendments ready, mister chair. Can I ask a question on that same one real quick? You're in charge. Well, I'm being courteous. Yeah, please. So I noticed that this one says SDS, safety data sheets. The other courses say MSDS. I've done some googling. They they're different. I I don't know if we're intending for them to be different.
I don't have the technical knowledge for that. Maybe some I've I've done that amendment a few years ago, and I was told I was old with MSDS. It's been replaced by SDS. So I think the current form is SDS. We'll research that, and bring that back to you and find out what's going on. Should they be consistent through the courses, though? Ideally, they would be consistent. But when we have different courses open at different times and if there's been change in the nomenclature in the field, sometimes that's difficult to accomplish. Sure. Okay. Alright. Member Hagman?
Amendments? First one is on d two c, page I dash nine, strike regulatory law and insert strict liability. A motion and a second, do you like to speak to it? Regulatory law doesn't fit here. I don't know if Member Childs wants to jump in as well. But negligence, product liability, contributory negligence are the standards for liability and strict liability seems to fit better to me of a different standard for liability rather than regulatory law.
Any further discussion? Is there any objection? Seeing none, it carries. Do you have further amendments? I do. Thank you, Chair. Just below in two F, HIPAA is misspelled. It's an extra P. Thank you. The motion is second from Member Childs. Would I speak to it? No. Is there discussion? Any objection? Seeing none, it carries. Member Higman. Thank you, Chair. 4E, compare the various career paths, strike B. A motion. Do we have a second? A second for member childs who I speak to? Yeah. The the career paths listed here are not exclusive. I think there's a number of career paths,
that could be considered. Is there any further discussion? Is there any objection? Seeing none, it carries. Member Hegman? Thank you, Chair. 5A is various routes of drug medication. Insert administration, and I'll need to get my glasses to read that one. What I've done is copied the same TEAC from the next course. So do I have to read all that? No. Okay. Okay. We have a motion by member Hickman for amendments depicted on the screen, five a in red. Do we have a second? A second from Member Childs.
Would you like to speak to it? Yeah, I think the way it's written various routes of drug medication is incomplete. I think the intent here is the administration. And then I just copied the various routes of administration from the nursing course which follows. Okay, is there any debate? Is there any objection? Seeing none, it carries. Further amendments? Thank you, chair. Eight c, insert cupping, comma, after acupressure. Do we have a motion? Do we have a second? Second. Motion and second from member Pickering. Would you like to speak to it? Sure. Yeah. It follows with the Guagio with your coining that follows.
And I'm a big volleyball fan, you may know. When you see the big red circles on the girl's shoulders, that's from cupping. I've heard about your volleyball fan. My one discussion. It's quite painful. I've done it. Oh, you have? Okay. Is there any discussion? Any objection? Seeing none, the motion carries. Next one, share, if I can. Yes. Eight e, insert, diet and exercise after or diet, comma, exercise, comma, after such as. Okay. We have motion. Do we have a second? Motion and second from Member Brooks.
Would I speak to it? I would. I think these are two of the biggest determinants of patient health that were not included. Okay. Is there discussion? Is Objection? Seeing none, it carries. Do you have further? I do. On nine d staff, are we ready for something? So you could this would slightly change the SC, but you could just start with identify how to handle, dispense, and safely dispose of hazardous medications and so on. The one change that would make, it would remove the identification of those hazardous, medications and materials.
But, so that is that is one option. Give me just a moment, and I'll see if I can come up with something on the spot that would maintain the identification. Can we say identify hazardous medications and material go ahead. I think you were No. No. No. I like that. Well, not sure where it was gonna land, but identify hazardous medications and materials, using And how to? And how to handle this dispense and and safely dispose of them using information from safety data sheets. The hazardous drug list in USB.
Let me see what see what case it is. Might be easier to see. Identify hazardous medications and materials and how to handle, dispense, and safely dispose of them. Stick a of after dispose. Dispose of them using information from safety data sheets and yep. So moved, mister chair. Second. Motion is second. Do we typically use them in peaks? We we'll try to avoid a pronoun if we can, but sometimes sometimes they're helpful. I think the other secondary option might be identify and identify how to.
It's a little choppy, but that would eliminate the need for the pronouns. Didn't you just say they're handling, suspension, and Yeah. Disposal? Yeah. And, Kaye, can you put the safely in front of handle? I'm not sure there works with every all of the verbs in the list. But we can put it here, and then we can It's first reading. Yep. Get another bite at the apple. Okay. Do I speak to him? I was, just curious if we were gonna have the students handle, dispense, and dispose of the actual materials. And with the clarification that they're not,
I wanted to just restate to something different. Okay. Is there any discussion? Is there any objection? Seeing none, it carries. Do you have further amendments? I do. Another question first, if I may, Chair. Next course, nursing. D1G, we talk about requirements of a number of different, I'd say, types of nurses. With member Pickering suggesting we have the kids dream big, is MD and physician's assistant covered somewhere else? Would that fit here at all? Is that otherwise covered in health care? I'm not sure where it might be covered.
We could take a look for that. But because this course is science of nursing, and I don't believe either of those would be considered the field of nursing. Right. Okay. So not in this course. Okay. Yeah. No no amendment there, chair. I think the only one I had was seven c. And then seven c strike various and insert national, comma, Texas, comma, and local, and then change I don't know if I can do both at once. Change the to there. Point of information, mister chairman. What's your point of information? What page are we on? We are on page I dash 14.
Okay. But we so we moved on to a different course? Because I have amendments on 01/27 dot 05/12. So have we already moved on? Yes. We opened the we opened the full subchapter here. And so Zero N five one. Subchapter j, which includes that one. We we can come back and do yours in a second. Thank you. Yes, Chair. I think lifespans, plural. Okay. Member Hickman's offered amendments to speak on the screen. Is there a second? A second from Doctor. Clark. Would you like to speak to it? I would. Thank you,
chair. I just didn't know what the various populations referred to. So I wanted to spell out national, Texas, and local, and I think that would be an interesting comparison, for these health trends. Okay. Is there any discussion? Is there any objection? Seeing none, it carries. Do you have further amendments? I do not. Thank you, chair. Member Pickering. Yes, Mr. Chairman. Thank you. On page I10, number eight, a new b, and then just reletter everything underneath it so it's an addition. And it would say explain vaccine exemptions including medical,
religious, beliefs, and conscientious exempt exemptions. Second. Motion is second from member Brooks. Would you like to speak to it? Yes, sir. We have had, several laws passed in this state around this, around, vaccine exemptions. Just four days ago, governor signed another new law. House Bill fifteen eighty six related this, making it even easier for parents and students to claim claim, vaccine exemptions. And so when teaching our nursing students about vaccines, I think it's important that they also carries. Seeing none, it carries. Do you have further amendments? No,
sir. No, mister chairman. Thank you. K. Any further amendments on subchapter j? Okay, moving on to Subchapter O. It starts on I-fifteen. Member Higman. We'll get organized here first. And let me get a little bit. Sure. We're in o. Go ahead. Okay. Page I dash 16, strike d one m, explain the function of scaling in a print. Sorry. Where are you? D one m. It's a duplicate of k with this bluebell. Page I 16 and I'm sorry. I'm not looking at the page number.
I'm looking at it. Blueprint reading for manufacturing application? Yeah. And then look at k, two above it. Okay. We have a motion. Do we have a second? Second. Motion is second from member Francis. Would you like to speak to it? I would. It's a duplicate of k, which is just above. K. Is there any discussion? Is there any objection? Seeing none, it carries. Do you have further amendments? I do. Thank you, Chair. Next course, Industrial Maintenance, General Requirements B on page I 17. It's copying the prerequisite statement from the next course,
which I think is mechanical maintenance. Okay. So say what's your What's that? Is it depicted correctly? Yes. K. We have a motion. We have a second. We have a motion and a second. Do I speak to it? I would. I think this is, well, the staff helped me if this is the same level as mechanical maintenance. They look similar to me. It is not. Industrial maintenance is a level two course, which does not have a mandatory CTE prerequisite. Level three and level four courses, do have standardized language
for prerequisite courses so that a student couldn't just go straight into a level three or into a level four course. So mechanical is three or four. Level three. Okay. One other question. I didn't see a lot of math in here. Did the group discuss why algebra one or geometry was required or recommended? Because these were subject matter experts that were convened through the interagency contracts, we weren't in all of the conversations with the group. We could we can ask that question and get that information for you. Okay. I withdraw the amendment, if I may,
mister chair. Okay. Is there any objection to member Hickman's withdrawal of this amendment? Seeing none, it's withdrawn. Do you have further amendments? I do, four f on page I 19 strike that. It's duplicated in five b just below. I 19 in same. Industrial maintenance. Okay. I didn't find the appropriate use is a PPE. Sorry. What number? Four f, page I 19 in industrial maintenance. Do we have a motion? Do we have a second? Second. Second. Motion is second from Vice Chair Little. Should I speak to it? Sure.
PPE is covered below in five b. I didn't think we needed the duplicate TQ here. Okay. Is there any discussion? Is there any objection? Seeing none of the carries, do you have more amendments? I do. Thank you, chair of four l, strike and safety data sheets. They're covered below in five a. I have a motion. Do I have a second? Second. A second from member Brooks, who I speak to. No. Just streamlining. Okay. Is there any debate? Is there any objection? Seeing none, it carries. Member Hickman? Next one, Chair five a is changing material safety data sheets to safety data sheets and SDS.
We have a motion. Do we have a second? Second. Motion and a second from Member Brooks. If I could speak to it. I guess I'll defer to staff's research if they come back to us. But my understanding, last time we did this was that the nomenclature has changed to SDS from MSDS. And I was too old. Okay. Is there any discussion? You said material data. Is there any objection? Seeing none, it carries. Yeah. You're right. Member Hegman, do you have further amendments? Yes. I don't know if it's too late to make those conforming, the same changes in the next course, or if I need to run through those.
Okay. Yep. My fault. So I'm in mechanical maintenance, d d one f strike PPE. It's covered below in two p. We have a motion. Do we have a second? Who would you like to speak to? No. Same thing we just did. Okay. Is there any discussion? Any objection? Seeing none, it carries. Member Higman? One m. Same thing. Striking safety data sheets here. We have a motion. Do we have a second? A motion and a second. Would you like to speak to it? No. Any discussion? Is there any objection? Seeing none, it carries. Do you have further? I do two a striking material to make it safety data sheets and SDS instead
of MSDS. Motion to have second. Motion to second from Member Brooks. Would you like to speak to it? Nope. Is there any discussion? Is there any objection? Seeing none, it carries. Do you have further amendments? I do for a, change air to a gas I 22. Wedding chaser. Do we have a motion? Do we have a second? Yes. Yes. So a motion and a second from member Brooks. Would you like to speak to member Hickman? I would. Compressors are used to compress lots of gases other than air. For example, air conditioners. Okay. Do we have further discussion? Chairman? Yes. Member Friend.
So thank you, chairman. So this course, let's just roll up to what the course title is. It's mechanical maintenance. So the objective of this course is to teach kids about compressors, which are air compressors. It's by no means we're talking about AC. It's a very specific course. I I think that broadening this language is a little bit too broad for the intention of this course. And I think that how we have it is perfect to what this course intends to teach students.
It's mechanical maintenance. So we're talking about air compressors mainly and how do you use them, and so forth. There's other courses for HVAC and other systems. K. Is there any other discussion? Great event. Member Brooks? I would like to to to learn further the difference between the two, the air and gas. It could t n a TEA just kinda confirm that last statement. Jessica, can you tell us the difference between air and gas? No. In in light of this TEAQ. So they made two different reasons, but which one is is I would like to address the one that's correct for
this TEAC. So would changing the word from air to gas make a difference with this TEAC? I think it would so the student expectation is to identify components of compressors, and then to explain how the components work together to compress, insert air or gas. I do not have the content a lot level expertise to say whether the how the components work together is different for air or gas. If it is the same, then it would not change the student expectation.
So may I ask the member or the the maker of this motion a question? Sure. So, member Hickman, would you be willing to, modify or amend your amendment to state air or gas? I I could say air or other gases. Okay. That would Is that Yes. Okay. If I could restate to compress air or other gases. Is there any objection to member Hickman's restatement of his amendment? Is that an objection, Doctor. Belmonroe? Is that an objection? Yes. I I I it just seems redundant because air is a gas.
And if you say compress a gas, then air, of course, is one of the things that will be included. I'm not a scientist, but Okay. So now we'll vote on whether Member Hickman can restate his amendment. All those in favor of allowing Member Hickman to restate his amendment, say aye. Aye. All those opposed? Ayes have it. The amendment has been restated. Is there any further discussion on this? Mr. Chairman? Member manager? Yeah, and just as a follow-up to Doctor. Belbidereux's comment, I understand that. But I would say that the air compressor is probably the most common one that
we think about. But I think by adding air or other gases, I think that what it it prompts the instruction to talk about air compressors but then to extend that to other compressors that you have in other applications. When I look at the full list of things that are being included here, it doesn't specifically say air compressors. It says compressors in general. But I I think that I think it's a good amendment. Mhmm. Member Pickering? Yes, mister chairman. I also would like to speak in favor of this amendment because on the Texas Gulf Coast where we have lots of refineries,
this is important for facilities maintenance because they're they are dealing with air compressors, and they're also dealing with several other types of compression of different gases. So on behalf of my district, I'm gonna speak in favor of this. Further discussion? Okay. All those in favor of member Hickman's amendment, please say aye. Aye. All those opposed? Ayes have it. The amendment carries. Member Hickman, do you have further amendments? I do not. I'm out of gas. Bunch of hot air. Member Brooks, did you have an amendment? I'm sorry, Mr. Chairman. I just had a coin of information for today.
I just wanted to ensure that you will follow-up with us on member Hickman's, was way back at the beginning, trying to even remember. Do you remember that member Hickman? What TA is going to come back to us and answer it was a question for the writers of the that particular tea. Was it we had a I have a couple of questions for mister Hickman. Are we talking about the prerequisites Yes. Of algebra one and geometry? Correct. So when you say come back, you mean by Friday? Yes. Okay. Great. Member Pickering?
Thank you, mister chairman. I have a question for staff. Please. Okay. So I just want clarification on these courses. The US Department of Labor says that by 2031, there will be a need for almost 80,000, workforce ready certificates for industrial maintenance facilities technicians and, just generalized facilities maintenance tech technicians. Did does this course get them to that workforce certification? I'm looking to my CTE cohort, in 0.88 address. Miss Pickering, if you'll permit us to get, some specifics for you. So we have industry based certifications that are tied to all of the programs of
study. I'd like to get the specific certifications for you. But, essentially, that's what we're working toward is making sure there's tight alignment between these courses preparing students to earn those certifications. Okay. If you could look that up, please. It's facilities maintenance technician Yep. And industrial maintenance technician. And I just wanna make sure that we are aligned so that these students can obtain their workforce ready. 80,000 jobs is a lot of jobs. It sure is. We'll get that for you. Thank you. Okay. Are there any other amendments for this subchapter? Mister chair, Stockton would like to recommend one technical edit,
to all of these courses in the employability skills reference. So if you were to start at the beginning, I dash five, but any one of the courses in that reference that missus Brooks was asking about earlier in a two. There's language that refers to the section in which the employability skills will be codified. And then it says relating to career and technical education, employability skills, comma, adopted 2025. Our rulemaking, division has actually pointed out that while that is how we usually refer to courses
with their entire, title, has proposed, and we'll talk about this in the next item, removing adopted 2025 from the title. Because by inserting it in each of your CTE courses, if you were to amend or revise those employability skills, then you would have the wrong year adopted 2025 in all of your courses. So the recommendation is a conforming edit to strike the language adopted 2025, from the implementation section in a two. Chairman? Member Francis? I'd like to make the motion to,
strike adopted 2025. It's a conforming edit, for all these courses in chapter 127, as written here. Okay. We have a motion. Do we have a second? Second. And a second from member Hickman. Would you like to speak to it? No. Is there any discussion? Member Brooks? Yes. I use those dates as a point of reference, however. So I think, is there a way, TEA, that if something is updated, it just shows that on that particular CTE or e course with the updated year? We can show you within the employability skills themselves.
So this is just a cross reference to those employability skills. We can show you where to find the adopted year within those standards. How easy is that to find online to do? Right there at the bottom of the course, it identifies both when they were first adopted and then each time they've been amended. For employability alone? For Employability. Any in any course. In any rule, you can see at the bottom each time that it has been, when it was first adopted and then each time that it's been amended. Thank you.
Okay. Is there any discussion? Member Francis? I have a a general, question for staff. So for some time now, we've I have been asking the question, how best could we identify the levels of each course? So when I look at a course, I should be able to tell immediately it's a level one, two, or three, or four. What has staff done so far to help to rectify this problem? Because we've been changing, and I still haven't seen that been brought forward. So, mister Francis, originally, we had discussed adding the levels to the TEKS.
Subsequent to making that recommendation, in a conversation with the commissioner, there was some concern that that might, run into some conflict with some rules that are under the commissioner's authority. And so we, are not including the specific level in the TEKS, but we're working on other ways that we can, provide those references in an easy to find manner. So we're still working through that issue for you. Okay. Do you do you have, like, a a a timeline before we adapt for so many courses? And then what would that look like when we finally have the solutions?
So I think this this is probably going to end up relating to, the issue that was brought up by the testifier that, missus Brooks followed up on in terms of us having all of this information in a centrally located easy to find, place. And so we currently have courses in the levels listed on our website, but we're we're identifying ways to make that easier to find. And I suspect what we will end up with is references in a number of different places so that regardless of where you go,
you'll you'll see those levels very easily. So I I'm hoping in the next, by by the time that you have your next meeting that we'll have some identified solutions for that. Thank you. Okay. So we have a motion on the floor. Are we ready to vote on this? K. All those in favor, please say aye. Aye. All those opposed, no. No. Okay. The ayes have it. Division. Point of information. Which point of information? Chairman, have we not, disposed of that question on the floor already? Mister Mainer's question too late? The parliamentarian's advice is not. Could you explain if we voted on something and
We did a voice vote, and he's asking for confirmation of it. So now we're gonna have to raise our hands and get confirmation of it. Okay. Mister chair, we've got you to do that anytime until the next business in the business. Okay. Furthermore, send an order until the next, item of business has been called up, which it has not yet. So now we'll vote, by by show of hands. Okay. Can we stand? You can stand. You can sit on the floor. I mean, you know, you can do whatever you'd like, sir. Point of information? Which point of information? Mister Treuer,
can you restate the vote, please, before we Yes. Once the screen comes back up. So this was a conforming amendment, technical, in nature offered by member Francis, seconded by member Hickman to strike adopted 2025. I can't hear you. Yes is in favor of this. Correct. Let your yes be your yes. Chairman? Yes? Do we know if, I guess I'm a little bit confused as to why a member would not be in favor of this. Do we understand that if we adopt this as is and we make,
changes to the employability skills, then the adoption date is gonna be wrong in each of these courses. So it it it Yeah. Member Francis is not debatable anymore. So Okay. Just gonna go back and and vote here. So all does everybody understand why we're voting now? Okay. All those in favor of the amendment as depicted on the screen, please show by raising your hands. Eight. Thank you. All those opposed, please show raising your hand. Two eight two. The motion carries. Are there any further amendments? Okay. Okay. As, as promised earlier, we've gone through each subchapter.
I'm gonna open it up now for any amendments for the entire, set of courses here. So anything we missed, this is the time. Okay. Seeing none, you're ready to vote? K. So we're gonna vote on the main motion as amended for the last hour and a half. All those in favor, please show by raising your hand. 11. Thank you. All those opposed, please show a raise in your hand. 11. The motion carries. Okay. The time now is 10:37. We're gonna take a break until 10:45. We got a little bit of reset of the room to do,
and then we're gonna take up agenda item number four for today, which is the Texas Which is the Texas Permanent School Fund Corporation report and update. So, Stan, at least. We are back on agenda item number four. So again, we're out of order. We completed item number one today. We're on four. Texas Permanent School Fund Corporation report and update. At this point, I'd like to turn it over to Mr. Bob Borden, the CEO and CIO of the Texas Permanent School Fund Corporation.
Bob. Thank you, Mr. Chairman, members of the state board. It's good to see you all this morning. I appreciate you affording me the opportunity to give you an update on some of the goings on and progress at the Permanent School Fund Corporation. So for some of you, a little bit of this is review, but I know we've got some new members as well. So this is worth touching on again and who we are. We are the perpetual educational endowment that was established in 1845 for the exclusive benefit
of K through 12 public education. The legislative session before last authorized through Senate Bill twelve thirty two the creation of a special purpose corporation, which combined the assets of the permanent school fund and the assets at the General Land Office that were for the benefit of the permanent school fund into a single pool overseen by a new board structure made up of five members of the Board of Education and two gubernatorial appointees and two appointees of the land commissioner.
Today, we oversee directly about $58,000,000,000 in assets. There are oil and gas royalty assets that are managed by the GLO that have a value of approximately $6,000,000,000 So combined, it's in the neighborhood of $64,000,000,000 of assets that are earmarked for the benefit of the available school fund, making us the largest educational endowment in the world. We have a dual mandate.
Our mission is twofold, to provide permanent funding for Texas public schools, and we do that by generating exceptional, stable, risk adjusted returns, are in order to make contributions to the available school fund. Our second mandate is to be a guarantor of bonds issued by school districts across the state such that all school districts can avail themselves of a AAA bond rating and therefore the lowest possible interest rate on their debt.
Some of the key metrics, on our mission. One of our main goals was to revise our asset allocation to invest a little bit more like the largest educational endowments in the country. And part and parcel to that was quantifying the effects of asset allocation changes on the AAA guarantee. And by putting in systems to model that far more accurately than had been done historically, the Board of the Corporation was able to approve a revised asset allocation,
which resulted in approximately a four tenths of 1% increase in expected return with no appreciable change in risk. The result of that was the Board of Education was able to, last fall, approve an increase to the five distributions to the available school fund increased by half a billion dollars to a record high $4,800,000,000 for the coming, biennium. And we believe that if we are successful in implementing our strategic plan,
both in asset allocation and implementation, the corporation should be in a posture to recommend to this board increasing distributions in the coming years. The bond guarantee program currently backs $130,000,000,000 of outstanding bonds, for eight sixty four different school districts and 32 charter districts as well. We have capacity to guarantee another $112,000,000,000 in bonds. So we've got lots of room to continue to
perform that function. And the result of that is the savings to school districts in interest costs, we approximated over $400,000,000 a year. This is a look historically at the distributions to the available school fund. You'll note a bit of a fall off in the years of the great financial crisis, a ramp back up, a little flattening during the post COVID era, but now to this record high $4,800,000,000 per year.
Our mission has us focusing on the following attributes that we would like to be a magnet for talent around the state. We have a very challenging and highly technical job to do in managing this $60,000,000,000 and we want the best and brightest team that we can recruit around this state. We want to be a leader in the methods and protocols and practices in endowment management,
all the while being an active partner, a citizen of the state that is partnering with universities and corporations and other industries, and most importantly, be a source of perpetually increasing funding for education. We strive for, the following values in how our team operates and interacts on a daily basis. We bring this value statement up almost every other day in meetings and reinforcing it to our team that we are first and foremost stewards of this pool of money.
All of us here, including this board, are but temporary stewards for a permanent pool of capital. And we want to conduct ourselves in ways that we are always acting as a fiduciary and making prudent decisions that are consistent with best practices, doing that with integrity and a high level of competence, giving a very high level of effort towards the task. And at the end of the day, we are results oriented and we can measure and quantify our results quite clearly.
We also strive to do all this in a very collegial, supportive, challenging manner that brings out the best in our teams. The performance of the fund, this is as of March 31, trailing returns. The trailing year, we've exceeded our fund benchmark by about 0.5% in the trailing three years, about 91 basis points close to 1%. So that's put a number on that, that's $550,000,000
$600,000,000 of excess return annually that's being generated over and above our policy allocations. The changes that we have made in the asset allocation has put the Permanent School Fund Corporation on much better footing vis a vis other large endowments in the country. And that can be measured by our relative peer group rankings. This chart shows the percentile universe of our peers.
And you can see a few years back, we were in the bottom quartile. And we have gone above median and even touched top quartile here in recent time periods. So one of the first things the corporate board set out to do was to adopt a strategic plan. We use a very, very detailed and thoughtful strategic plan to guide all of our activities each and every day. There's nothing that we are undertaking at the corporation that is not encompassed in the
strategic plan. And there's nothing in the strategic plan that has not been accounted for and assigned to responsible teams to further. It's a very robust plan and provides us with a very effective playbook to manage our activities day in, day out, month in, month out. The first goal is to optimize the asset allocation. As I mentioned, the changes that the corporate board has made has shown immediate positive results. And in 2024, I'm pleased to report that we were the third highest returning endowment in the country,
vesting such blue chip notable endowments as Harvard, Yale, Stanford, Princeton, etcetera, etcetera. So the changes that are being made are clearly putting us on a path for excellence. Our next steps in this goal are to further refine sub allocations for some of our alternatives in private equity. Our second major goal is once we've adopted an asset allocation, how do we execute within that asset class the types of strategies,
the structures, the partnerships in a way to invest in the most attractive risk adjusted return framework within each asset class. We have started to model risk exposure in a much more comprehensive way and for the first time, including all of the royalty in oil and gas programs managed by the GLO, which clearly the risk associated with the commodities market has an effect on the overall
plan, and we need to be very cognizant about that in our other investment decisions. We've established, in addition a year ago, we established a standing investment committee that meets weekly to vet all of our ideas. This year, we've established a performance analytics research committee to really refine all of the metrics in the risk and the return of our portfolio. What we have next on our agenda to accomplish in this goal is to implement
an overlay program that allows us to make adjustments and fine tune asset allocation in a very efficient manner. I'll give you an example of that. Our foreign exchange contracts, We have multitudes of managers that are managing currency long and short in different markets, but they're doing that individually. And so sometimes you're paying to put contracts on in one direction and then put contracts on in another direction. We are now going to net all of those things to only put on the
net differentials that collectively our investment management team wants to see. We think there's $5,000,000 run rate of cost there that we can squeeze out of our current process and just have a much more efficient foreign exchange management program. Some of the highlights in our commitments so far in this calendar year, we've done a total of 18 commitments of $3,600,000,000 Seven of those strategies are with new managers and firms.
We have a mindset that we kind of label euphemistically as Texas First. We're not an economic development fund. We are here for the sole benefit of the K through 12 schools and the available school funds. So, we seek the best risk adjusted return period. Having said that, because Texas is the, by various measures, the eighth or ninth largest economy in the world, it stands Is to reason that we will find a lot of exceptional opportunities within the state of Texas, and we indeed do.
And of that $3,600,000,000 $2,200,000,000 of it has been placed with managers either headquartered in Texas or have significant economic interest in Texas. So not only were the employment base there and the fees that we were paying are staying within the state of Texas. We also try to have a very open architecture that allows us to consider smaller firms, typically emerging firms, minority or female owned firms. So far this year, we did three placements in that space for
over a third of a billion dollars Our third goal and perhaps one of the most critical to our success in the future is to attract, develop, and retain talent. When the corporate board hired me in late twenty twenty three, I was given the mandate to try to turn this organization into one of the best endowments in the country. I spent a lot of time rationalizing organizational structure and then comparing that to the human resources we had on hand. We had roughly 100 employees with the authorization to go to 125.
Before we did that, though, we actually reduced the workforce about 20%, trying to make sure that what we had in terms of talent had all the right attributes of dedication to the cause and competency and effort and the attributes that we express in this value statement. Now we are postured over the next three years to probably add about three dozen people, and who we hire is going to be critical. We are very fortunate to have recruited a top flight general counsel and chief operating officer
who start next month, which will be a huge improvement in our daily operations and effectiveness. But as we attract, custom tailored to them in terms of continuing education, professional certification, particular job experiences. It's expressed in their annual review as expectations of how they will develop themselves, along with an assignment of a variety of strategic plan tasks. So we've now launched a training effort that we're taking very seriously. We're fortunate to be in new facilities where we have room now to gather all
the employees together for training and development. We launched our technical series this year of requiring every employee to level set their technological skills in Excel one, two and three and advanced PowerPoint one, two, three in advanced and applications of artificial intelligence. We will be doing this with every new hire and we will be doing it regularly as reinforcement with the entire team. What do we have on next? This was so current that we've now hired the COO,
as I've already mentioned. But our biggest challenge in human resources will be building out the direct investments, special situations teams. These are going to be very high talent individuals, and we need a really strong recruiting effort. To that end, we did hire a dedicated recruiter and I'll talk more about that here in the next slide. The second wave of our training and development though is going to be the soft skills of professional training, supervisory skills, management,
leadership, executive coaching. Again, all employees required to go through this curriculum to level set our thinking and our skill set, both on the technical side and the management skill side, the entire organization. We believe in developing staff like that, it will also help us retain staff. One of the last pieces of organizational structure we're working on is rationalizing the accounting and operations structure. We're we're soon to have that finalized, we think, probably next month,
next six, eight weeks. Part of the recruitment really starts with internships. We brought our largest group of interns on this summer. I believe the count is somewhere around 16. We'd hire more, except we believe it's real important that each of these interns has a dedicated work plan and a dedicated sponsor to help develop them. We think this is an excellent hiring pool too for a farm team for permanent employees. Now there's some interns that have a stated goal of, you know,
maybe, let's say, they wanna be on Wall Street, but we'll help them, open doors and achieve those things. But what we hope is out of these programs comes some permanent employees that, we've been able to develop. We just started this outreach across the state. As Seth said, we hired a dedicated recruiter at the beginning of the year, and we're starting to, kind of in rungs, in concentric rungs, reach out to the different universities across the state. And this list will grow as we have time to continue to establish relationships with recruiting.
We're also going to have some part time interns that we keep during the year. We have a consolidated boot camp program for interns when they come on board together, much like we're requiring all of the staff to have level set training in both technical skills and management skills. We're doing the same with our interns. We're partnering with some of our strategic partners, like the locally headquartered Dimensional Fund Advisors to do some cross training and experiential work with our interns.
And we're hosting our first internship networking event at Innovation Tower. Our next goal is to enhance communications. Some of those my very presence here at this moment speaking to you is an example of that. I hope that some of y'all saw last week the first newsletter that we've ever sent to the Board of Education. We're gonna send this quarterly to y'all. So regardless of whether you're meetings, you're gonna get regular written updates on the highlights of the performance of this plan. We've developed a mapping system for a variety of reasons,
stakeholders that we can map where our different investments are, where our investment managers are, etcetera, etcetera. I'm going to show you an example of that in a moment. We've increased our online presence significantly, a 300% increase in our LinkedIn followers, which is an important source of recruiting by the way. One of our next steps in communications is an employee volunteerism program and further refining the communication process for you all as well. And we have been doing now regular town halls where we will have investment leaders,
you know, global leaders and talent that we do business with come down to Austin and hold fireside kind of chats for the entire team and and, bring their team down and do training. Matter of fact, it just so happens here, as soon as I leave this meeting, when I go back to Innovation Tower, Goldman Sachs is hosting a special event for all of the funds that are in the area, the teachers and UTEMCO and etcetera, some of their senior staff all coming together to, you know, have a think tank meeting with leadership at Goldman Sachs.
I thought you'd find this interesting. This is an example of our mapping system. What we did is we took this $130,000,000,000 of bond guarantees that we do and mapped it across the state. The blue dots represent school districts in which we have guaranteed bonds. The size of the blue dots are the you know, dollars at play. So naturally you see the, you know, Dallas and Houston area, you know, having big dots. But what's pleasing to see is there's dots all across the state and almost every
corner of it. So the the bond guarantee program is really working. And especially or this earlier this morning, I was addressing the, rural school educators, association. And this is critical for some of these small school districts that would typically have some of the lower credit ratings and therefore would be paying the highest interest rate on their debt. And we're able to give them the level footing that everybody's got a AAA debt rating and the lowest possible financing rate.
Our last two goals are ones that we have been spending a great deal of time on from our inception as a corporation, and that is all these great ideas of investing and recruiting are only going to be as successful as the strategic plan that's guiding us and the governance and internal controls that we have to get it right. And when we take the internal controls very seriously, we made it a priority to build an internal audit group first before we were hiring more investment people because we want to set that tone of compliance and importance.
We received a clean audit on the bond guarantee program from the state auditor's office. The corporation board is hard at work at developing new ethics and governance policies. We've been working on that for several months and will continue to throughout this summer. Our internal audit program is up and running and launching audits now. And we started with the very big dollar areas of investment fees and expenses. And also the politically kind of sensitive ones on performance pay to make sure that
that has a high degree of integrity. We've created a budget tracking protocol and process where there was none and an integrated employee evaluation process that I mentioned. Again, just to put some more color on that, we have everybody set for an annual July 1 to June 30 evaluation period. We have custom tailored career development plans. We have assigned goals from the strategic plan. So we make sure that every job task that comes out of the strategic plan
is assigned to one or more people. And that becomes a key metric in their evaluation and their compensation is their contribution to the plan and their development of their own personal skills. Next time I'm in front of you, I'd hope to report that we have our newly approved governance and ethics policies in place. Other updates, the appropriations for the budget to support our plan was very well supported in the legislature this year,
both in the Senate and the House. Very pleased for that, very thankful for the attention and care that was given to us by the legislature because they recognize the importance of our mission. And I think more importantly that we're able to demonstrate the changes that this corporation's board is putting in place are already bearing fruit. And because of that, we received a high degree of support. Our AAA status was recently reaffirmed by Moody's, which puts us ahead of The United States Of America's credit rating.
So you can be proud of that. We are working on implementation of the governor's letter regarding investments or divestment in China does not apply directly to the PSF. But nevertheless, in the spirit of being a good citizen in the state, we are complying to that as best we know it to be defined. And we're also in compliance with Senate Bill six sixty seven, which we had to do with proxy voting, which this corporate board
has spent a lot of time prior to hiring me on really addressing their responsibility in proxy voting in a responsible way that made sure that Texas values were represented in the way we voted proxies. And we were very pleased to report that early on last year, we were able to put in a groundbreaking proxy voting metric that's basically euphemistically known as ESG skeptic, which I think better focuses proxy voting back on corporate profitability and shareholder results and
not other political agenda items. And we're a leader in not only the state but the nation in doing that. So that concludes my prepared remarks, Mr. Chairman. Happy to deal with any questions anyone has. Bob, thank you for coming over today. I have one question, clarifying question on something you touched on. I think it's an important point I want to make sure that we highlight. The AAA rating on the bond guarantee program and the amount of liquidity that's required
there, can you kind of break that down, the analysis that y'all done, that really freed things up? And if you look at like the asset allocation decisions made because of that or in tandem with that, maybe it's the right way to say it, how that has increased returns. And can you put that all in lay terms for for everybody to to understand? Yes, sir. So this dual mandate presents a little bit of a challenge, right, where you want to get the best risk adjusted returns.
Obviously, higher returns means more money going into the available school fund. But at the same time, if you need to be the AAA backer of bonds, there's a limit to how much risk that you can take in the portfolio and maintain that AAA rating. Historically, the Permanent School Fund was not really in a position to quantify that trade off. So out of an abundance of caution, we erred towards the side of being very conservative in the asset allocation.
That certainly maintained the AAA credit rating, but it may have left some excess return on the table historically. So what we did is we demystified that. We quantified it by building credit rating models that were provided to us by the credit rating agencies. So we know this is how they do the scorecard such that we could model different asset mixes and come up with an implied credit rating for those different mixes.
And historically, we had lagged our peers for the simple reason that we had a more conservative asset allocation, more cash fixed income and public equities and less private equity, real estate, natural resources, quote unquote alternatives, which were the higher returning plays. What we found was that we indeed could have had a asset allocation much more similar to the other large endowments and still maintain the AAA rating.
So what the Board has done is adopted targets that kind of migrating a little bit closer to that and where we find today, we're able to put a fine number on it. As I said, we have roughly 130,000,000,000 of bonds outstanding. We could we could back another $119,000,000,000 with the balance sheet we have today, significant excess capacity. To top that off, there's also many tools that we can use should we ever get to the point that we were issuing a lot of bonds, let's say, and we were eating up a lot of that capacity,
or the liquidity in the program started becoming more and more illiquid, there's a lot of other levers we can pull to get that headroom and we'll see this happening years in advance. But to really just summarize the answer to the chairman's question was we demystified this by creating quantitative models that allowed us to measure and model this in a way that we clearly can see the trade offs and manage this in a much more transparent and thoughtful manner.
Governor Maynard? Yeah, Bob, I'm just gonna preface the question. I think that one of the things that may not really be fully understood about Senate Bill twelve thirty two and essentially twelve thirty two was a delegation of this board's responsibilities related to the management of the permanent school fund that's in the constitution to the corporate board. I think it's worth noting that that did not really diminish this Board's role, it actually amplified it.
Because prior to December is that the Board is given the constitutional duty and has since 1876 to oversee the Fund. But at the time that the leadership of the fund did not work for this board. We had a governance issue and this board was really limited in terms of what we could do and how we did it. Essentially what December did is it cleared up the governance flaw and then allowed
the corporate board to fully engage in this process. One of the things that we thought that was really, really important and when we went in to go hire a new CEO, new leadership, We wanted to see a change of culture. And we wanted that organization to operate more like the private sector. That was one of the benefits of creating the governmental corporation is that it gives us a lot of operational agility that we didn't have under the agency, but it also gives us the opportunity to and again,
to we were addressing the cash drag. A lot of people don't realize is that we had, that the School Land Board was sitting on $4,000,000,000 $4,000,000,000 of uninvested cash is sitting in the treasury pool and it was costing Texas public education at a very minimum of $200,000,000 a year to sit on $4,000,000,000 of uninvested cash. And so we needed to address the cash drag. And so that was a piece of that.
But Bob, I'd like for you to speak a little bit just in terms of what has been done. Number one is that we kind of had Doge before Doge became popular. And number two, just in terms of opening up the culture of that place and what that looks like now, we can see the return on investment. Some of that is due to asset allocation that came as a result of us solving the liquidity, riddle that we had asked about. But a lot of this is operational too.
And can you speak a little bit about just in terms of efficiency and culture? Yes, Chairman Maynard. I'm happy to. I think some of my observations immediately was that the organization had been siloed to an extreme. There were groups that might as well have been working in different states that would have a subject matter expertise, but were not really collaborating and working together. There were also a bit of, dare I say,
laissez faire attitude, typical in government bureaucracies that, I don't know that the amount of effort, that's required to really move this organization to excellence was exhibited in several people. And that's where we did this very detailed assessment of all the teams. And before we were hiring around that, I'm a firm believer that you can't just add people to a problem. You've got to make sure that you've got a good core team to begin with,
that's got the right culture. And throughout that process, and it's not pleasant, but it's necessary, resulted in over a 20% reduction in staff. We're extremely thinly staffed right now, but we're staffed with people that are driven for personal excellence, for personal career development, and are dedicated to the cause. They see this opportunity for us to finally be on the map with the best endowments in the country. Personally, I don't think I would have expected to see so much success as fast as
we have. And there's a lot of moving parts, you know, as to why that is. But generally, it's really confirming to the staff that this is quite possible and quite in their control if they give the effort for the state of Texas and for them. And basically, I tell the staff we have a contract with you in theory. And that contract is we are gonna develop you professionally. If you have a path that you want to be on, we're going to ensure that you get the job experience,
the professional certification, the training, and continuing education to get you there. It's a wonderful, wonderful benefit for someone to have their career actively managed like that. For that, we expect selfless devotion to the cause. And we have a very detailed strategic plan that goes all the way from this mission down to objectives and milestones, down to individual job tasks that are assigned to folks. And the trade off is you have to do your part to contribute to this.
We tore down the silos by having, like, an investment committee that's open to all the investment team. And at first, there was a lot of hesitancy to be critical in your assessment of anybody else's ideas, but we have overcome that now. And we have a group that challenges each other in the right way, in the most healthy way, intellectually challenges and pushes each other's, you know, insights and opinions. And you're starting to see now more confidence grow out of people,
not only in their own ability to develop, but confidence that we are heading this whole organization in the right direction. And it's palpable. The energy when we moved into this new building, for instance, before I could even issue a return to work policy, everybody was there. They couldn't wait to be in these new offices. There's fear of missing out if they're not engaged and around. And, it's it becomes a self fulfilling, you know, prophecy. And, I've seen, like, the internship programs. They sound like,
you know, we're starting at such a low level, but if you get really talented young people, you know, a year goes by, two years goes by, five years goes by, next thing you know, they are investment officers and senior investment officers, and I count among my former interns over my forty year career, almost a dozen chief investment officers at multibillion dollar funds. This talent goes and grows. And one of the mantras we have with the interns that are moving on that they also are responsible for recruiting their own replacements. They have to put their name on somebody else.
And it's just a, you know, a very good collegiality. We have a lot of folks that are, you know, if you don't have like the gold standard for an investment professional is the CFA designation, takes a minimum of three years to get. Everyone in the investment team either has one or they're in the program. And they challenge each other. Once a year, the test results come out and nobody wants to be the one that didn't pass that level. It's healthy competition, healthy challenging. And if successful, you know, my job is to create a culture that becomes self sustaining and long after I
and all the other staff that are there today are gone, that the culture is embedded. And I look at this as, I think I mentioned earlier, it's a 180 year old, dollars 60,000,000,000 start up operation. And we have this opportunity, once in multigenerational opportunity, to change the trajectory of this fund. And that's what we're doing. And we're doing it in a way that will outlast us all. And just as a follow-up, Mr. Chairman, if it's okay. Can you tell us a little bit about, and I think a great example if you watched the last board meeting just in
terms of what this new board, this new structure has been able to do that we couldn't do before And just in terms of really leaning forward into how we're looking at investments and I think a little bit about we had a fixed income portfolio that was essentially core bonds. But we've been able to evolve that into some with infinitely more creativity, really leaning forward into some things like private credit and things that we haven't done before. Just a little bit just in terms of really leaning forward
some transformation that we've been able to do just in terms of that implementation process of that asset allocation. So as I said, not only historically were we overly conservative in our asset allocation, which would lead to more core fixed income bonds, but historically decided we really wanted to do that internally. And because of limitations on talent and ability, it led us to eliminate a lot of areas within corporate finance that were valuable. For instance, not a lot of corporate debt.
It was mainly treasuries and agencies and structured credit. So even the design of that portfolio immediately hobbled it from being competitive to a more broadly diversified universe. On top of that, I guess it is what it is, we found that there was a lack of a culture of compliance in how that portfolio was managed as well. And we took swift action to shut down that whole program and to move these monies into much more diversified core fixed income programs that,
we think there's easily 100 basis points of higher return and lower risk than the way we were managing it and send a message to the rest of the organization that the culture of compliance is real and it will not be tolerated with anybody who has not bought in to that. I'll say that there's an interesting side effect. Because the organization was so siloed, the problem within that program, most fortunately, had not bled into other parts of the program. But that was an immediate shutdown and overhaul.
We moved $8,000,000,000 inside of about six weeks. And then we've leaned in very strongly into the broader it's basically the non bank bank play called private credit. Coming out of the great financial crisis, the regulations in commercial banks has essentially made it unprofitable for commercial banks to provide lending to corporate America, and I mean Fortune 500 companies. And it's created this vacuum where these companies need debt financing and are willing to pay quite handsomely for it,
but they need solutions that are custom tailored to them and in big size. And we were able to build, some strategic partnerships with some of the best in the world in this private credit space and avail ourselves to 2%, 3%, 4% higher returns on floating rate, three year, over secured financings that are extremely low risk and yet capitalize on, you know, a gap in the market. So it's been transformative in many ways, right? We've now got a team that is much more creative in the implementation and we
have a culture of compliance. And one of the like I said, the first thing we did was set up the office of the internal audit division. Doctor. Ellis chairs our audit and ethics committee. And I think he can tell you firsthand that that was right out the gate, one of my first discoveries at the Fund. And we took swift and unambiguous action to correct it and set the tone going forward that we're going to be creative, we're going to stretch our minds and our ability to implement,
but we are going to do it within a strict framework and culture of compliance. We're going to do it right. And I think that's permeated throughout the organization. A lot of interest here. I'm gonna go around this way and continue. I got Hall, Brooks, Rebellious. Sounds like everybody. So I'll just keep the log going here. They might recognize. Yes. Okay. So I have a question on just, like, the whole obviously, new to the board and several of us are here. As far as making new investments, what's the decision making process there and who is involved?
So we have an investment team that's rather diverse. Obviously, we've got subject matter experts in the different asset classes like, let's say, real estate versus oil and gas versus private equity versus credit. Those teams get together. We have an investment committee that meets weekly. We have subcommittees for both due diligence and performance and analytics. We have an open process in which we want to consider any and every opportunity
that we can. But to give you an order of magnitude and the discipline that we have, in 2024, we evaluated over 2,000 strategies firms. We hired 47. So we've got a very hierarchical process that we go through to screen out things for and there's the five principles of the philosophy of the portfolio, the process they use to build it, the performance, obviously, the people behind it and the price.
And we look for firms that have demonstrated abilities to consistently generate value in a way that you can understand it too, that is very clearly articulated and implemented. And this is the process that we go through each and every day. And so those teams collectively, over 2,000 meetings. And so far this year, we did, I think I said 18 deals, 19 deals, something like that. And we're on pace again to be over 2,000
firms and the like. So every single day, there's this process. And when it comes to the investment committee finally, it's gone through subcommittees, it's gone through peer vetting around the organization. And then we have voluminous underwriting documents behind all of these things to lay out the risks and why we think those risks are mitigated and acceptable and why it's a strategy that competes with 10 other things that we could do. And a quick follow-up,
if you don't mind, Chair. I'm a say I know you have a variety of factors you look at when deciding where to make new investments. And I'm assuming that the strength of the management team is one of those factors when you're looking at new opportunities. And you have on Slide 15 that you shared with us where you note the emerging manager slide and you have female owned there. I think you also mentioned minority owned. So when looking at, say, those two categories, female or minority owned, is that a factor on whether or not the investment is made at all?
Or is that just a point of interest that you list at? Exactly, precisely, because we are seeking the best risk adjusted return period. That's our mission. Our entire compensation structure is based on that. We're not an economic development fund. We're not a social development fund. We are a return seeking machine. Now, having said that, like I said with the Texas first thing, because if you look at that, it's almost stunning that that's a lot of firms in Texas.
Are you somehow cutting corners or getting biased because it's in Texas? Well, the way to frame that is we're the eighth or ninth largest economy in the world. So there's a lot of opportunities there. The firms that are on this list, these female owned and emerging minority firms, they have had to rise to the top through that same very, very rigorous structure. And as you might imagine, for young firms that are starting out or teams that don't have a lot of there's a lot of them that go by the wayside. Come back, see us next year, see us in three years,
but you're just not ready for prime time. We also contract with third parties to do operational due diligence on like their systems and their internal controls and review their own audits to make sure that those firms have strength in internal controls. And many times in especially younger and developing firms, you see gaps there. So we won't do it, but we will share that information with them, so they know how to be better in the future. Member Brooks? Thank
you very much for being here. I have just a couple of questions to ask. So the balance as of last year 2024 was $57,300,000,000 What is the Fund as of 05/31/2025? It's over $58,000,000,000 I don't know the remainder, but $58,000,000,000 and change in the fund. And I mentioned the last valuation that's been performed on the oil and gas royalty program, which would have been September thirty of last year,
is approximately $6,000,000,000 So the combination of those two is the pool of assets that are for the exclusive benefit of the K through 12 schools. Alright. And I really want to talk about the bond guarantee. So I'm assuming that you want to increase that. Is that what the Board wants to do, increase the guarantee level or No, ma'am. No, ma'am. The process by getting bonds qualified for the bond guarantee program is administered by the TEA and school districts go through a very prescribed process to see that their debt
is conforming approved. I won't even pretend to know the depth of that process. But once the TEA has decided that this district is eligible for the bond guarantee program, then the rating agency simply looks at our balance sheet, our overall $57,000,000,000 how it's invested, all the different asset classes, and looks at the outstanding debt and makes a judgment of does the guarantee by the PSF warrant upgrading that debt to AAA?
And they do, and they do by a large margin. And so what what I was trying to say is we have a 130,000,000,000 outstanding. Mhmm. Theoretically, we could have almost 250 outstanding. It would still be AAA. Okay. So it's just theoretical? Yes. Okay. So along with that Remember, Brooks, there's a formula that we have. It's in rule that says how much we can make and it's based on the asset base. Is that correct, Chairman Maynard, if I remember correctly? There used to be some limits from the Treasury Department, U. S. Treasury Department.
We've kind of gotten those removed over the last couple of years. But as the asset base grows because it's a formula, the capacity would grow as well. And that's through TEA, I can get that. That's through our rules as the State Board of Education. Okay. And it's also worth noting that we've been doing that since well, we guaranteed our first bond in 1984. We've never had a default. But of course, we're talking about ISDs, which are governmental subdivisions with a tax base. Now we also guarantee the bonds for charter schools. The difference is is that the charter schools actually,
they pay a percentage of their savings. Whatever their savings is, the amount they're saving between whatever they're rated versus what we can get them, they pay into a charter reserve fund. And the reserve fund, if there was ever a default, the permanent school fund would be made whole out of that reserve fund and not out of the corpus of the fund. My question after that then is who oversees that reserve fund? We do. So so we've not had one charter school that has ever defaulted on their bond payment. Okay. And what what what is in place in case an ISD or charter school is
unable to pay their their their mom principal? And and what what do you do? Yeah. So that's that's one of the things the rating agencies ask themselves. Right? You know, let's let's do the hypothetical that these school districts go in default and stop paying. Mhmm. How is the PSF gonna come up with that money? For the public schools, it's kind of unique because as chairman Maynard said, you know, the public schools are governed by, a body that has taxing authority. So typically, if that were to happen,
the PSF is really on the hook temporarily to make principal and interest payments until such time that that body, that school district increases the tax base to make up for that. And we would be made whole. But that's never we've never even tested that. But that's what would happen. We would provide it's not like if there's a $50,000,000 bond, it goes in default and we just eat $50,000,000 It's basically the interest on that for a time period that is in default and then the local taxing authority takes care of that.
Now for the charter schools, that's different, right, because they don't have taxing authority. So there's a formula in which they basically have to put up some monies that we keep in a segregated account in Treasury bills and super highly liquid cash investments such that should they get into default, there's some money set aside to that and it's been modeled appropriate with the risk. The only one I can think of in my tenure, one of them, one of the charter schools got in some
real instability, but was then purchased by a much larger, healthier organization that assumed all the debt. We literally haven't had to test that. But even so, those bonds are typically still securing real assets, you know, sticks, bricks, buildings, dirt. Just like a bank, you know, in theory, you may have to become an owner of that. But in practice, I don't think that's likely to ever happen. Lastly, thank you. There was new legislation for that. Correct? Where is there money set aside for charter schools for bond payments?
Is that right? Or what has changed in this legislation for meeting? Am I wrong with that? I think I think there was a maybe a a facility fund. Yeah. A do you know could you speak to the facility fund under the new legislation, how that will impact I don't know if that really impacts the the the bond guarantee. I don't think that really affects For charter schools. Yeah. I don't I wouldn't I wouldn't know exactly what the interaction is between those two things. Okay. And lastly thank you, mister Maynard. Lastly is before the board, there used to be some of the investments,
affect people's lives, right, depending on what type of investment it is. And and and people would come to the board. These were just meetings that I would watch. And and perhaps there was a a a grievance or there was something that was wrong. Let's say if it was an apartment building and and and there was just not a response from, their local management. When when you invest in something and there is a problem that happens, who does that go before and how do you deal with that? Because in a perfect society, you're investing in things that probably promote the the values of our state.
But in some cases, it's hard to manage an endowment this size and kind of know how it affects people on the, on the personal level. Could you speak to that? Is there a process in the corporation on the corporation side where perhaps there's some investments that just aren't really going so well? Where do those people go, I guess, for that type of of information before the board before the corporate board side. Deborah Brooks, I'm not entirely sure I understand the the question,
but, you know, we're invested around the globe in all types of assets. And we have professional management firms in the regions and on the ground and specialize in the particular mandate that they have with us. And they report to you. Yes. But they have the discretion to manage those assets in the way that is in the best interest of the shareholders, which is us. And so we are driven by the best risk adjusted returns,
period. Matter of fact, this staff is disincentivized to do anything but that. So it sounds to me like again, I don't I'm not sure I understand the what you saw in the past, what the example is, so I'm struggling to to respond because I I don't think I understand types of events that happened. I I think what I'm saying in short is, I guess, the integrity of the investment. I'm not an expert in this. Mhmm. But I know that you you diverse in different businesses.
And I guess my question is, I know you want the the maximum return. Mhmm. But but what are the guidelines that kinda guide you into what you invest the in the the the resources in? And and and do you have some sort of, like, rubric or framework you use to to see where you put the money that essentially the citizens Certainly. Our activities are governed by an investment policy that the corporate board approves. And that policy lays out,
amongst other things, the asset mix, the types of assets that we're permitted to invest in, the amount and limits to investments within any asset class, and the measuring sticks, the benchmarks that we're gonna hold ourselves to in each and every asset class. And combined, and we inform that decision by what the capital markets are offering in in in the current and expected future market conditions and we filter that too
through what our peers do, it's important to know. Because as a fiduciary, you know, you want to do things that are, quote, you know, what like people and like circumstances with like information would do. So it is important to have a framework of, you know, this is how your peers invest. So to the extent that you deviate from it, you know, you should be doing that eyes open. Point point in case case in point, I'm sorry. Historically, we knew that endowments and foundations were invested in a way that had more real estate and private equity and private credit,
but the Board was intentionally doing that because of the bond guarantee program. So there was a deviation there that we did. So to summarize, the Board sets the investment policy, the asset mix, the limits, and the measuring stick, and then the staff implements within those guidelines. And as you've mentioned, it kinda changed during this transition to the corporate board, correct, from previous Yes, ma'am. Right. And those go ahead. If I may, so the IPS existed before the corporate board.
The investment policy statement is pretty standard in institutional investing. So we already had one and it's not a static document. You shouldn't touch it every board meeting. But periodically, it needs to be updated based on changing conditions around you. So yes, it has been updated, but it was something that existed before. This is not something that the board created out of thin air. And I'm looking this is on the IPS, I believe, is on the PSF website. So texaspsf.org.
And then click on About and then Policies, if you'd like to kind of see what that's all about. Member Revels. Thank you, chair. Miss Bourne, thank you for for being here. I'm currently new to the to the SDOE. And as I go up at my district speaking with, with, school leaders and school representatives, this Microphone, please. Oh, yes. This is the topic, the school parent fund, that I'm least comfortable speaking about just because I don't I'm a writer by trade, so I, you know, my mind doesn't work in numbers like that. So thank you so much for this presentation.
It's gonna make my, my level of comfort speaking to them a lot better. I do have a question. I'm happy to see you mentioned the attract, develop, and retention of talent as you continue to grow and and provide services to the state. I know you're looking for the best people. What priority do you give to people that are Texas centric, people that live in the state, are from the state? Is that something that is, that is, taken into consideration as you go about looking for for the best talent?
Well, I think the proof statement is the fact that we do so much business in Texas. That's the outcome. But this is just a different flavor of the same question. We seek within an asset class what strategies we think offer the best risk adjusted returns. That's what's driving us. But because Texas is such a large economy and has so many talented firms, it is a regular occurrence of the 2,000 firms that we talk to that a significant number would be Texas based.
But then they're held to the same competition and standards of non Texas based firms. And so the fact that they ultimately got a mandate from us means that they demonstrated in all these important ways of of philosophy, process, performance, people, and price have have stood the test of the due diligence. I euphemistically say, you know, if we have a tie, which you never do have a tie because it's so nuanced and complicated. But having said that,
the mindset is tie goes to the Texan. Does that apply also to the recruitment of personnel and employees? Is that is that I Oh. That's the question. Absolutely. But we have a treasure trove of young talent in the state. And we definitely post and we recruit nationally. We look everywhere we can. We'll go on to professional job posting sites for, like, CFAs or CPAs or auditors or what have you. We want the best talent across the the country. But, you know,
we have almost an embarrassment of riches in young talent in the state. So we don't it's natural that the preponderance of our hiring will come from within the state Because also there's relocation considerations and folks that would have if we hire people from out of state, I'd say that more than half the time, they're returning Texans, That they they wanna come back. That's that's good to hear. I also wanna commend your outreach for, for at the university level.
Mhmm. But I did see a glaring geographic emission there. I don't see the University of Texaco. I think that the one part of the state that is not being I'll start out just so I recommend that you please also consider part of this text. I know we're amount in time, but No. What what you see there is the first six months of doing this. This list will get more and more robust. I look forward. Because it does take effort, right? We've got to send representatives there. We've got to establish relationships with the university recruiters, get the flow of information. But we just like we want the best risk adjusted return,
we want the brightest minds, and we'll go any corner of the state to find them. Great. Thank you so much. Member Hickman? Mr. Borden, not an easy question, but you've always been able to answer all of my questions. If I look at the values of stewardship and integrity, as a PSF board member and as a state board member, my big concern is some of your colleagues run off and buy an island in The Caribbean. So how can you make me comfortable, or maybe it's Doctor. Ellis as well, what policies, procedures,
rules do we have for oversight to prevent that sort of occurrence? Well, I'm not aware of any colleague that can afford to buy an island in No, taking PSF money. Oh, yeah, to buy an island. Right. Well, I mean, we operate as fiduciaries. And, again, what would like experts in like circumstances with the same information do? And we have, you know, I'm not sure I understand that question. Is it really, could we have an investment that suddenly we own an island in the country?
No, no, sorry. Let me restate and make it more clear. I don't personally get to see the account statements. So if $1,000,000,000 goes missing, I don't know. So if one of your colleagues runs off with $1,000,000,000 I'm not going to know about it. How do we prevent that So in the institution? We first off, none of us actually have access to the money. We have a custodian, a third party, in this case, it's Bank of New York, that's one of the largest global custodians in the world, they safe keep the assets,
they value the assets, they have significant levels of internal control that are tested by their own auditors and their own statements that our internal audit department reviews their strength of compliance. And all we can do is issue instructions to move money from one investment manager to another. And it's multiple signatures from investments to operations to accounting to legal. You have so many layers of checks and balances there,
it's almost impossible to imagine the level of collusion that would have to occur between multiple different disciplines on staff and third parties that are safekeeping the money. And we're auditing. We have KPMG as our external auditor to come in every year and to test all those balances. Everything that we show the board on reports of the monies we own, they go and test that that money is there. So there's a multitude of levels of insulation from that type of thing occurring.
Mr. Chairman, if I can just kind of add to that. When I became chairman, it became apparent, I discovered that we had no internal audit whatsoever over there when this is still under the agency. So I worked with the commissioner and with the deputy commissioner to put that under the internal audit of the agency. That said, is that as good as those guys are, doing an audit, doing internal audit on a major investment firm is a lot different than just something that's happened over in an agency. So one of the first things we did when we brought it out of the
agency is we set up that internal audit. And we hired somebody, actually Fernando was actually previously at KPMG. And so that's one of the first things that we did is to stand up that internal audit. And we still have a relationship on certain things with the state auditor's office and of course with an external auditor. They have lots of layers. The internal auditor reports to the Board, correct? Yes. Right. Independently. And I might say on this note too,
just from a culture standpoint, we had a long time controller retire this month. We replaced that controller internally with one of our senior internal auditors who's a CPA and has the accounting experience. So, you know, the person at the top of the accounting pyramid is steeped in internal audit and internal control you know, culture. So if I can summarize so that I can sleep at night, we've got internal audit, external audit, and BNY actually has the cash. Right. You you can't get to it. I can't. And what what did you say BNY's role is?
What are they called? Custodian. Custodian. Custodian. Okay. Great. Thank you. Appreciate it. Welcome. Member Schatz. Hello, Bob. I just have four quick questions. Can you talk a little bit more about the emerging manager program? Specifically, how does the firm apply? How does the firm get the feedback that you said that you all provide? How do you guys determine if a firm is ready versus not ready? And do you guys give any help or ceding to a Texas based firm? Last part of the question is the most interesting. May I try my best to answer this?
Some of this is going to sound a little bit like a broken record. We try to be driven as purely as possible by these principles of risk and return. And we look for these demonstrated track records of, first off, an articulated investment philosophy that we can understand, that is clear and unambiguous, a portfolio construction methodology that we can understand and can be demonstrated as consistent in the way that they build the portfolios, a performance track record that shows they have delivered,
and then the people, their education, experience, how long they've worked together as teams, etcetera. And then last is, of course, the price that we pay for that. Those are known as the five Ps. And you can go into a lot of detail about each one of those. And there's some interesting opportunities though economically in seeding. Sometimes we'll do that, let's say, with a very well established, very large strategic partner that is kind of unassailable in their capabilities, but they wanna create a new product that doesn't really have a track record,
maybe it's an offshoot of other products. Well, there's sometimes an advantage for us to see that at very little economics, sometimes no fees, sometimes even an ownership interest in the product where we get paid to have the money managed. And in effect, an emerging manager is that. It's seeding something, but it doesn't have this huge infrastructure around it. Number one, we are an open funnel of folks that want to get consideration. There's no prescreening process if we're not even gonna talk to you.
There's over 2,000 meetings a year that happen. And I personally think where we can take that, you know, outcome, because I don't wanna call it a program because we're not setting aside money to do this, where it's a natural outgrowth that, you know, sometimes, you know, what you find is that maybe it's a new firm, but it's not new people, right? It's people who had a lot of experience in other places that have come together. Each individual opportunity is unique in how you underwrite that.
I talked about one of the issues that seems to trip it up early on is their own internal control structure. We use external parties that the only thing they do is operational due diligence on firms to see that they have the checks and balances and controls in place, and we will bring those to bear. And a lot of times in an emerging firm, let's just hypothetically say there's 12 key areas that we really need to see,
and they've got eight or nine of them, but there's some gaps, gaps that are concerning enough that you would say like person and like circumstances would not do this. But we can share with them that, you know, it's these two areas that you've gotta come back and bolster, you know, to get us to the point that we feel comfortable doing this. And every case is unique. Now, this becomes a much more high effort, right, on the staff's part. We've got to take extra time and really peel the onion.
And then typically you're talking about smaller dollar amounts. So it's a resource allocation of like, how many of these people are we going to spend looking, chasing small things around here? Having said that, there are opportunities that you know, getting in on the kind of ground floor, so to speak, of a firm that, you know, just because it's a new firm doesn't mean it's the first time they've tried this and you see that they are, you know, have a lot of talent and capability and track record.
And maybe you can even take ownership interest in the firm where, you know, the economics are hugely in our favor, but they're still in the firm's favor too because that critical, you know, it's the chicken and the egg. How do they get to enough assets to make it to the next level of institutional quality? Somebody has to take a risk on them to get there. And the early risk, you know, usually commands the best economics. And in a sense,
the manager's kind of given away the store to get those assets, but it sets them on a trajectory for growth that it's very much worth it. So because we're an open architecture, we see all sizes and shapes. Obviously, the biggest firms in the world have long figured out where we are and they're all over us. But on any given week, we see firms that are very nascent in their life cycle and we have a dedicated team that helps underwrite that. And we've got a,
I just showed you what we've done so far in 2025. The last time we did this, we've got a cumulative number that shows a lot of success there. But it's high effort. And what we hope is that it pays off for us in better risk adjusted returns going forward. And it would be really nice too if, oh, by the way, they happen to be in Texas as well. So we certainly some of these firms could be the future, you know, the best performing firms ten, twenty years from now. And if you can identify them,
it's worthwhile, but it's part of our ongoing process. Now, the success rate, the hit rate, is obviously a lot lower percentage than it is for the, you know, the big Just a couple more questions. This question is from my constituents. How would we expand, I guess, the use of of the permanent school fund? Would it take statute or alleged to do that? Because a lot of my constituents don't really understand. We have 58,000,000,000 in the permanent school fund, but we can't use it for all things related to education.
It's only for a specific purpose. So what would it take to expand, I guess, the purposes of the PSF? Legislative acts. Right? Just statute. Constitution acts. Statute and or constitutional, depending on when you say expand, right, in anything. The monies go into the available school fund, which has its own rubric of rules of how that can be spent. There's a lot of flexibility there, but could we put money up elsewhere? I mean, there's a, I'll give you a hypothetical. Maybe there's another type of education related enterprise that needs debt,
needs to issue bonds. Could we guarantee those? We have the capacity, but we would need specific legislative authority to do so. One of the things that came up earlier, just to make sure we footnoted here, is that the fund is sovereign wealth fund. So, like, when we're talking about it's $58,000,000,000 These are our children's children's children's children's dollars. And so we have a fiduciary responsibility at this board to make sure that we're doing that. So if you remember, for the 80% of this board that was here last year in December when we made
the decision, we had a full formula where we're trying to evaluate, hey, how are we going to take money to use to fund education in the next biennium while also protecting it? So it's just I just wanna put that out there and make sure for the new board members that you're starting to think about it like that and for the public to, like, not a piggy bank. Like, this is a savings account for the future. Understood. Last question. How could one of the members of the board help you out in the internship application and selection process going forward?
Play more of a integral part of it. Well, we have and that question's been asked before, and we we have some examples of, you know, some some active, help, particularly if a board member is an alumni of a a school that we have yet to have approached and formed that relationship with and they have some connectivity to that school, that would be great to say, I want to introduce the PSF recruiter to this person at my alma mater that
is responsible for helping kids get jobs as interns and post graduate. And we are happy to have those introductions and make that connection. Thank you. Doctor. Belmonroe. Thank you. Thank you. Can you hear me? Yes, ma'am. Okay. Thank you for being here. I would like to ask you about, asset allocation in terms of, allocations in sustainable energy and fossil fuels. Because over the last decade, sustainable energy has actually consistently outperformed fossil fuel investments.
So, could you address that that issue? How much is it? Is it actually diversified and how is it diversified? Yes. So we're actually energy agnostic. Again, we will look for opportunities to generate the best risk adjusted returns irrespective of the source of energy. And we have investments in fossil fuels and we have investments in clean energy and live a whole variety of them. If we, again, find the strategies that have this principle of five Ps
and it competes with every other opportunity that we're seeing in that case, we'll do it. We're agnostic. Oh, well, I'm just asking, what is your record over the last ten years? Because over the last ten years, renewable has outperformed fossil fuel investments. So I'm just saying, roughly, I don't, you know. I don't I don't know that, where where exactly you're pulling that data and observation from. The Google. What do you Yeah. Because I mean, that's where where where does anybody get their information nowadays? I don't just do any kind of fact checking,
but it's just I can assure you if we thought we would make more money in another area, we'd be actively seeking out opportunities. But you don't have that sort of breakdown available to you? No, we do. And I can put a fine point on how our experience in these different strategies has unfolded maybe as a proof statement to what you're seeing there. I can I mean, I'm sure that if you're willing is that on? Yeah. If you're if you're willing to just give a rough,
figure at some point, that would be great. Yeah. I think there's probably a couple of things to note there. One is that when you broadly talk about energy investments, so we talked about the GLO's portfolio of royalties. So that would obviously be in your traditional energy sources, oil and gas. But when we're going through this is kind of tying back to, Member, Member Brook's question earlier about asset allocation and the IPS. We're not specifying, like, at the board level specifically about how,
how much what percentage should be in, this type of energy or that type of energy or this technology or that. It's more about asset classes, so the types of securities that we're investing in. I'm sure that, you know, Bob can work with you to to provide some results. I think, at least from the board level, it's it's not really how we're we're thinking about allocating things. Is that fair? For instance, public equities, you're not going in and picking. All right. Mr. Chairman, I'll refer to a statement I made earlier about risk, because we're looking at it much more holistically now.
And we are, by constitution, the beneficial owner of about $6,000,000,000 or more than 10% of our portfolio is oil and gas royalty revenue off the wellheads in the Permian Basin, okay? So we know that's part of it. So we actually want to make sure we're not adding unduly to that concentration because that has a lot of underlying commodity risk. There's so many flavors of how you can invest in the energy space that don't have anything to do with the commodity,
with the delivery systems, with the pipelines, with the technologies. And we look at a whole spectrum of investment opportunities within that that also include sustainable energy technologies and that compete based on their risk adjusted return profiles. Okay. Well, I'm I'm getting my information from Forbes. So they are the ones that say global renewables investment, return was seven times higher, than, fossil fuel investments. Now this was back in 2021. So, I and and that that trend has has continued according to Forbes.
So Yeah. Yeah. I think time period's important. So, Bob, maybe you can take that away, and I'm sure y'all can compost some data and Sure. Slice it and dice it, but with the caveats that we've kinda talked about. I think recent data is gonna be a little different than that, but that's my intuition. Member Pickering. Thank you, mister chairman. So my question is actually kinda around, Senate Bill six six seven. So we know by filings that an organization has routinely over the years testified before this board has received funding from the Chinese Communist Party.
So my question for you is, how do you identify if a corporation or association or organization, again, quoting senate bill six six seven, sole proprietorship, any organization that y'all have dealings with, How do you identify if they are, partnering or funded by the Chinese Communist Party? And then also, how much do you have you identified where current investments are? Well, there's several information sources that, we can rely on. You know, the Treasury Department publishes very detailed lists of a variety of bad actors,
you know, terrorist sponsoring organizations, other organizations that have been deemed to be adversaries of The United States. I will say that this Board adopted an asset allocation a year and a half ago that eliminated all of our emerging market allocations in the public space. So all of the publicly traded stocks in that market are gone, we don't own any. We have some holdover private equity investments that, excuse me, that will mature and roll off.
We can't just sell those on any given day. If we tried to sell them on the secondary market right now, we would likely take a significant discount in doing so. So the prudent thing is for us to let those roll off naturally. But we're not making any new commitments to China and we're not holding any liquid Chinese investments. So we don't really have to deal with that question in our due diligence going forward.
Okay. And we know that the CCP has, LLCs filed in America. So what's the due diligence on seeing if and something you're investing in in a state side is, is part of the CCP? Well, I mean, we we would certainly identify that in examining the portfolio and in interviewing the management team. This is not something that, yeah, we think is a very profitable pursuit. So, again, I keep coming back to that same mantra, you know, we're looking for the best risk adjusted returns.
I would characterize something such as that as very high risk and probably not offering returns that are compelling to begin with. We are not considering any investments that are linked in any material way to China. And this board took that decision prior to this legislation. We did, but I think that was more centered around emerging market funds around EMFs. That wasn't really related to domestic, corporations. Yes. SB six six seven is directly related to domestic corporations. And so a terrorist watch list from the US government wouldn't necessarily have domestic corporations
on it. So that's why I'm asking, what's your vetting process to make sure that when you're dealing with a domestic corporation, it's not a front for the Chinese Communist Party? Yeah. You know, I wanna give your question, you know, a very well vetted answer. It's a good question and it deserves a good answer. So I would ask that if you can allow me to come back to you offline with a little bit more articulated, you know, set of screens and facts and circumstances of how we do that. Yes, sir. Thank you, sir. Doctor. Young. Going back to the conversation related to charter schools and,
any bond that they may have. We have a charter school that's, dissolving this year. I'm curious, as to if Rocketship had a bond and if We will. We might be end up bailing them out? I don't think so. Can I actually well, Rocketship was a was a was a startup? And so I will tell you that in order for a charter school to be eligible for us to guarantee their bond, they have to be at least investment grade. And so that, you know, we're not really gonna be really guaranteeing bonds to start ups. And so that that,
you know, they've gotta get that's the first hurdle that they've gotta get to. And so so something like that, I'm I'm pretty sure that we don't have a a bond with them, a bond guarantee with them. They've gotta be at least investment grade. Thank you. I have a question for you, Bob, before I see if there's any further, and then we get you out of here. But last, let's see, Q3 and Q4 of last year, as we were going through the five distribution, the corporate board and this board kind of agreed on a methodology. Is the intent that we're gonna use that methodology again in the next biennium or
at least that framework? Yes. Would you mind distributing that to this board or getting to the SPOE support office, just the framework of that one? Yes. Because that is the fiduciary duty, one of this board. And I want to make sure for our new members, they have time to conceptualize that. I think it will make for a smoother process for us down the road as we can continue to dialogue about that. We'll be happy to do that. And I'll just make a high level comment that one of the guiding principles is that we try to have a sustainable spending rate that will,
after inflation and accounting for student growth, at least maintain the same purchasing power per student at a minimum, that we don't want to erode the purchasing power per student in our gifting. So those are the, we weigh student growth and inflation expectations very heavily in that calculus and it all starts with what we think is the expected return of our portfolio. So, I'd be happy to share that and it is singularly important back to the fact
that this is a sovereign permanent fund that we should always be, we wanna contribute as much as we possibly can, but with a comfort level that is not going to erode future purchasing cars for students. Yeah. And just to be clear, what I'm kind of requesting is just a single slide, no numbers on it, just what the methodology is and how to think about it. So we can start to get, get our minds around it. Be glad to. Alright. Are there any further questions? Yes, chairman. Member Francis. Thank you, chairman. Thanks for being here,
mister Borden. I got some questions I wanted to ask you. So I was pretty engaged this legislative session, and, I was surprised to see this particular legislation filed, SB 19 o three. I don't know if you're familiar with it, but this legislation and I'm quoting from what the the, the bill analysis said to strengthen fiduciary governance and promote strategic leadership. We've heard today how we've have record returns, and we've we're compared against certain funds.
So I guess in your opinion, am I to understand that, the five members who were who we've appointed to the board, are not able to carry out these with with, with with the fiduciary governance that is expected of them. Because when I inquired about the bill, I'm being told that there is some concern. So in your capacity as CEO, CIO, what is your, assessment of or expertise that we have on the board from the State Board of Education? I think the results speak for themselves. This board collectively, all nine of them,
have been very engaged in this entire process since Iowa was hired. They're very engaged in the strategic plan, in asset allocation, in performance, and most of all in governance and internal controls. So I cannot speak to, you know, the reasons that a particular piece of legislation may have been crafted in that way. But in my opinion, the results are self evident. So I I guess what conversations I'm I'm curious as to what conversations were had
at the board level in order to defeat this piece of legislation because I would expect that there would be some opposition to this if if your if your sentiment is that. But I didn't really see anyone from the the board, testify against or even on the bill, you know, to provide some clarity, on what you just said. So were there any discussions in that regard on at the corporation level? No. Not not at the corporation level. We we obviously were aware of the bill. They obviously tracked it.
But there was no conversations of any type of strategy at the corporation level. So you pretty much, I guess, just thought that this bill wouldn't go anywhere. I'm just trying to understand, like, why because I I know that the corporation takes active roles on, commenting on legislation. Is there a prohibition that, you didn't go to represent us there? Or No. I I would just tell you from my position as CEO Uh-huh. I don't think it is my position to opine to the legislature what the governance
structure should be for me. Now, speaking, board members may have their opinions, But I have to be agnostic about the job is to do what the legislature has, you know, outlined. And this is the governance structure that the legislature has put in place. I think it's a significant improvement from the historical governance structure and, you know, it's just not my place, my position as CEO to opine at the legislature of who should govern me.
Okay. Well, I mean, I I think the the constitution is pretty clear, but I I just wanted to clarify that with you because that was obviously concerning to me as a member of the State Board of Education. Ultimately, the 15 of us here as elected state officers, are fiduciaries of this fund. So, you know, I I I look to my colleagues, you know, my five colleagues, and saying, like, if we are employees, and I know you're the employee of the board, I personally would have expected that you would play some role in supporting the SBOE
members and and or interest. But, I'll just make that comment, and then I'll move on. In your your your chart on page eight, performance versus benchmark, I I don't know if you mentioned this somewhere and I missed it, but it's good that we are we've, we're very much improved, that we're performing well, and we have what you've termed here as excess return, when compared when you're comparing against some a benchmark and when you compare this fund against other funds in this particular class category,
education endowment, we're doing well. But I don't know what is the comparison that you use. For example, everyone agrees that, a meter is x long. Right? And, you know, so we know that when we measure distance, it's fair and it's reasonable. And I guess in in terms of investment, I guess I would expect to this to be compared against the S and P 500. So is that the benchmark that you use? Because I'm just concerned that if if there's not a fair, you know, the benchmark that everyone agrees on,
then the metric of performance and, by the way, how you evaluate the per the the managers of the fund is sort of loosey goosey. Could you explain what you compared against and probably just allay my fears on what level of trust I give this benchmark? Yeah. So this benchmark is a weighted average of multiple benchmarks. And the benchmarks are selected for each asset class. So, you mentioned the S and P 500, we have an allocation to the S and P 500 and we hire managers to
invest within that space to try to pick a subset of the 500 stocks that they believe will outperform the aggregate of the 500. And we do that for every asset class and what you see here is the total of policy return. But we would look at equity managers within the S and P and compare them to the S and P. And we look at real estate managers and compare them to an appropriate real estate benchmark. We'll look at bond managers and compare them to an appropriate bond benchmark.
And then the mix that we have, a simple example, the sixtyforty stock bond mix, right, if you had 60% in the S and P and 40% in bonds, you would have the S and P's return times 0.6, you'd have the bond return times 0.4, and that gives you the policy return. So we are comparing apples to apples within each asset class and we are therefore able to aggregate what an overall weighted average policy return should be.
Did that did that answer that? It did somewhat. I was just wondering, it seems like you've picked subsets off the S and P 500, in your benchmark and not just the straight S and P 500 against everything that you you've invested in. I guess I'm more familiar with because my thing is, if I'm gonna pay somebody to do something, they better be beating the S and P 500. Else, I mean, why do I have you? You know, because the S and P 500, you could do for free. You could just throw it in S and P 500. That's right. So I I I was just curious as to what the benchmark was.
So if if I may real quick. So if you, the website that I was directing member Brooks to earlier, the PSF corporation website, if you look on there on the IPS, appendix one of that, which is page five, has all the benchmarks laid out. So for anybody who's interested in that and those have been board approved, for the specific strategies. Yeah. Thank you for that, Sherman. I guess my my I guess my point was the the S and P 500 better be in that comparison. The first one listed is the S and P 500 Okay.
For large cap US equity. But for small and mid cap US equity, it's something else because it's more appropriate. Okay. Okay. Thank you, chairman. So I think some time ago, I'd asked a question, mister Borden, about some some investments, and you could try to reply offline if you don't have that information handy right now. But you had mentioned, some investments in my district along the South Texas and Gulf Coast, I believe natural resources asset class. Could you talk to do you still have those?
Are you still holding those, investments? And what I was trying to see is if we had a a year to date because I'm I'm trying to see what our allocation was, in those asset classes and then what we had projected and how well did we do. I don't believe that I I never sort of got that I and crossed those t's. Is that something you could speak to that here right now? Or would you like to get back with me offline? I could move on to another question. Yeah. I'm happy to get back with you. I mean, I would generally say that those assets tend to be pretty long duration plays.
So, it's highly likely that almost all of that is still in place. It's not like we don't go in and out of a natural resource play in the course of months. Right. Because these tend to be like ten year fund investments that we're in that draw down money, invest and then distribute money back. So it's not if anything, we may have made more commitments. I would not I would not guess that it has changed. Sorry. Could you speak in the mic?
Because I can't hear you. Oh, well, I would not guess that it has changed that materially because they're long duration assets. And I I guess my point was that I hadn't I hadn't received any information. So maybe if you could just get with me offline on that because I'd like to get some information about those specific 13 I think you have mentioned. Yes, we will to the extent that we're not otherwise there's certain limits on the granularity of information that we can share publicly because of competitive
intellectual property concerns amongst managers, but we certainly will share anything and everything that we're able to. Okay. I'll I'll I'll assist that when you send it to me. So and I don't know if I missed this, chairman, but I was also looking at the website, and I couldn't ascertain, or some information from our independent investment consultant. So, mister Borden, what is the role because I didn't even see the latest NEPC report. What is the role of the independent investment consultant in advising the PSF board?
And and, also, when is the last time we did authority evaluation of this consultant? I believe we had NEPC since before the board was a corporation. So what's their role, and how often do you evaluate them? So somewhat analogous to the custodial role, you know, we were talking about with member Hickman's question earlier that we have a third party that provides control and oversight, in this case, on actual movement of money and cash. In the case of an investment consultant,
they are an independent voice to the board that helps shape investment policy, asset allocation, benchmarks. They also review performance independently. We look at performance, we use the custodial records to calculate performance, but we also have this independent consultant to reevaluate that performance as well just to make sure that it is consistent in its outcomes and conclusions. So they're instrumental in helping shape investment policy,
asset allocation, benchmarking, and performance and analytics, as well as a variety of much more targeted things on, you know, information about due diligence on firms. You know, much like I said, we take 2,000 meetings and they they take far more than that and maintain a lot of information and records on managers' track records, due diligence concerns, and we're able to share and make sure that we're not missing that they're not aware of something we're not and vice versa in our due diligence processes. And and as to the the the selection,
like, how do you what's the process for selecting this consultant? Because it's my understanding that the current, consultant that we have has been on board with us for even before inception of the corporation. Same with the custodian. We'll be addressing that in our in our governance policy that we're developing. Okay. So, I mean, just as you're sitting here now, is it something that you intend to do yearly? Like, what's the normal case? No. I mean, this should be, you know, much like, you know, was mentioned earlier, you know, we don't sit here and look at the investment policy at every meeting because we
are making long term projections, you know, full market cycles, seven to nine years, and you're going to deviate significantly to the favorably and unfavorably in a month, six months, a year, doesn't change your outlook on the next ten years. And it's very expensive to move money and assets around chasing returns. You have to have a long term view of this. This is consistent with fiduciary standards. I think you're answering a question that I didn't ask. My question was the consultant themselves.
Yes. So what what is the sort of cadence that you would review their process? Because this this has nothing to do with the investment and the actual money, but the consultant. That's right. And my answer to you is, as a corporation, which is my experience here, we're developing our first ever governance policy. And in that governance policy, we will speak to the process for the board level, service providers that the board selects, and that's under development right now. So it didn't exist six months ago or a year ago.
So I don't have any You you can keep my hat on and say, this is what it was. Okay. I I was just trying to ascertain, like, is it something that we we intend to do based on your experience every five years, every three years? Yes. It's not very frequent, unless you have programmatic challenges where you're not meeting your objectives or you're finding that there's been significant turnover at the firm or representation or things of that nature.
I mean, you monitor all those relationships for their own consistency in how their business is being run, the stability of their client base, the stability of the team that's representing you. And, you know, again, in governance, one of the things that we'll be suggesting with the board do is its own evaluation of how it feels that it's operating together, and that would be part and parcel to that. Would you say that, the quarterly updates to this board, as we carry out our producer responsibility,
would include updates from, from this consultant? I don't know. Quarterly seems, like, a frequency probably higher than it it needs to be. I'd say certainly annually. Okay. And, again, I just started the very first quarterly one last week. So this is part of this start up nature and, you know, the feedback process of, you know, is this because we do have a, you know, a very serious goal of improving our communications. That's right. We think it's critical. I mean,
how many of life's problems can be traced back to poor communication, right? Yes, sir. So understanding what is useful, what is not useful, what is reasonable, what is legal, etcetera, we can refine that process going forward in a way that everybody finds useful and feels like they have the information they need to discharge their duties. Right. Thank you. Last question, chairman. Sometime ago well, actually, a long time ago, probably, predates your arrival at the the corporation. There was talks that the current building where the PSF corporation was didn't have enough
seats. Basically, it was smaller. And I understand that you're now in the Innovation Tower. You have nice beautiful billing and space. Is everyone back on a return to work posture there? Is so is everyone coming into work? And I know the state asked us and other agencies, your agency, about the remote work, survey. But I was just curious as to know that you have a nice beautiful space if everyone is in a return to work posture in the office. Absolutely. Okay. We passed that policy as soon as we moved in.
Okay. Thank you, sir. Thank you, chairman. Okay. Are there any further questions for mister Borden? Bob, thank you for coming over to see us. I think we're a little late, but hopefully you make the rest of your meetings, get some lunch. Thank you for the opportunity. I appreciate it. Any closing remarks you want to make before I move on? No, I don't think so. We're going to just keep chopping wood and look forward to next progress report to give you. Thank you for the work you're doing and to the team over at PSF Corp. We appreciate it. Speaking of lunch, I know Bob's got to go to lunch. It's 12:45 right now.
I plan on Stanities till 01:15. We'll come back and we'll take up item number two. So I'll see you at 01:15, Stanities. Okay. We're back. We're on agenda item number two from Tuesday's agenda. Proposed new 19 TAC chapter one twenty seven, text essential knowledge and skills for career development and CTE, employability skills. So on, we're on second reading, final adoption today. Board agenda page I dash 29. This time, I'll ask Monica from the agency to introduce that. Monica? Thank you, chairman.
So this is your, second reading and final adoption of the employability skills that we talked we've talked about for a couple of meetings now. These will replace the employability strands that exist in each distinct course. Jessica is handing out the public comments that we received on this item. We did send those to you in advance as we received them. There are only a handful of comments. We didn't see anything in there that we felt like was not covered or,
would, be worth consideration for, additional amendments. But, certainly, if if you see anything in there, that causes you to want to make any changes, you, can do that either today or Friday. Otherwise, I think this is is pretty straightforward. The one thing that we will note here is, related to the item that you just concluded. If you look on Roman numeral one dash 33, so Jessica talked to you about the cross reference to these standards and taking out the reference to adopted 2025.
Adopted 2025 is currently in the title of 01/2015, and so, you may want to consider striking that from here as well. Other than that, that's, we don't have anything else on this item. And I do I probably should have before I started, I do think there is public testimony on this item. Okay. We'll go ahead and take the public testimony at this time. Testimony is limited to two minutes per speaker. The timer in front of you will count down the time, and you can begin your testimony when the green light is on.
Thirty seconds remain when the yellow light is on, and you need to end your testimony when the red light is on. Gonna call, Levon Deloney, doctor Charles Leslie, and Nikisha Paul, please. Lavanda Loney? Alright. Well, I'm back. And, again, I'm doctor Lavanda Loney. I am a Texas Educational Policy Institute fellow, and I'm here speaking in strong support of the final adoption of the proposed one two seven point one five CTE employability skills. As an educator and advocate for the career in readiness, I commend the board for its continued leadership in strengthening the alignment between education and
the workforce. There the establishment of the universal set of employability skills is not only timely, but it is essential. Today's rapidly evolving economy, students must graduate not only with the technical knowledge, but also with the critical workplace competencies such as communication, teamwork, problem solving, and professionalism. This proposal addresses a long standing gap. And while employability skills have been presented in some CTE TEKS since 2017, their inconsistency across courses and clusters has led to uneven preparation.
So with one two seven point one five, we now have the opportunity to provide every CTE student across every program of study with a clear and consistent foundation in workplace readiness, starting with level one and two courses and progressing on to advanced expectations in level three and four courses. The impact of this work A ripple far beyond the classroom because it ensures that Texas students are not only just industry aware, but they are industry prepared. And while implementation will require thoughtful professional development and curriculum alignment at the local level,
the benefits far outweigh the cost, and it sends a powerful message to students, families, and employers that Texas values the employability as much as the academic achievement. So I urge the board to approve one two seven point one five for second reading and final adoption and to affirm an early effective date so that the districts may begin the implementation in 2025 to 2026 school year. Thank you. Well, Leslie? Good afternoon, members of the board.
My name is doctor Charles Leslie, and I am proud to represent the Texas Association Education Policy Institute, or TPIE. Today, I am commenting on agenda item two, to firmly advocate for TEAS, career development and career technology education. Investing in CTE is strategic and imperative for Texas. It not only prepares our students for jobs, it's about building a stronger and more prosperous future for the state by ensuring a
skilled and adaptable workforce. Investing in career and technology education programs is crucial for Texas to become equally equipped for students with in demand skills that boost the state economy and addresses projected shortfalls of skilled workers. CTE programs bridge the gap between education and workforce, preparing students for both immediate employment for and further education.
Here's why CTE is important for Texas. It helps with the skilled labor shortage. It helps with economic growth, and it helps with meeting industry demands. By 2031, 30% of Texas jobs will require education beyond a high school diploma, but not less than a bachelor degree. CTE graduating will be earning industrial recognized certificates that enhance their employability.
I wanna thank the board for your leadership in moving forward with this effort. Thank you. Nikisha Paul. Good afternoon. My name is Nikisha Paul. I am also a TPAI Fellow and an elected school board member with Texas City ISD, where we serve more than 8,000 students across 14 campuses. I'm here today to express my support for the adoption of one twenty seven point one five, establishing the TEKS for employability skills across all high school CTE courses. This proposed rule is a powerful step forward. It ensures that every student gains access to the essential skills needed to succeed in
the workforce. In my district, we've already seen success, embedding these skills into our CTE programs. For example, in our advanced manufacturing pathways, students participate in mock interviews, industrial led presentations, teamwork based projects. These experience have not only increased job placement, but have helped students show up more confidently and prepared in the real world. That's it. I want to raise a few considerations to ensure successful implementation. Without additional support of funding, districts, particularly smaller or underserved ones, may struggle to integrate these standards effectively. CTE teachers are already balancing a rigorous content and may need targeted training,
to add to this later layer. Therefore, I recommend that we provide clear guidance and professional development to CTE teachers, allow flexibility to this to districts to adapt standards to fit local workforce needs, and ensure these new expectations are accompanied by resources, not just mandates. This rule represents the kind of forward thinking policy we need. It reinforces our commitment to preparing students not just to graduate, but to lead, contribute, and thrive in life beyond classroom. I thank you for your time,
your leadership, and your continued commitment in equity and excellence in the state of Texas. Thank you. Member Rayner. Mister Chairman, just a question for one of the testifiers. Please. We have a number of people here from the Texas Education Policy Institute. I was wondering if one of the testifiers could tell us a little bit about the Texas Education Policy Institute and what what what kind of brings them here today. Good afternoon. How's everybody doing? I see, quite a few that I've known for the last ten years, with, CPi. And, of course,
my other person over there, we all went to, was in school together. So, really, I just love her. We we've been together for a while in, in school middle school and everything. So it's very good. So, anyway Ma'am, if you can speak closer to the microphone, that would be helpful for surprised because I really am tall a a loud talker. So so that's okay. Let's let's see if I can put it up a little bit. Okay. So, I wanted to make sure that, get that messed up. Okay. One of the things I wanted to do is to let you everybody know that
this is a program that has started for ten years. Doctor McLeod and, has always wanted to do something for all of those who need to learn how to work with legislature. And so that's how doctor McLeod and, wanted to make sure that we would be able to do that. And and, definitely, just to make sure that they would know how to when they walk into legislature, they wanna come in and know what they're saying. That's basically what it is.
And also and how to work with the, legislature who needs to also tell them how to speak when it comes time to, know what to do. You don't just go up in there and say, oh, I didn't like how they did that over there at the legislature or, I think we need to do it this way or we need to do it that way. You need to know how to do it. And that's one of the things that we do here with TPOT. And so we're really excited that that has really, helped us a lot. We also work with those who are interested knowing on how to work besides working
with the legislature, but, also, this is the group. I'm the director, and this is my this is my director, and I am the director. But we all try to make sure that everybody gets the same and equal, as they go along, when there's, learning how to do. Okay. We wanna also learn how to know how policy and advocate is very important and also and learning how to knowledge. You need to know. You can't just talk it. You need to know it, and you need to practice it.
You know, you just can't go on there and have one line and think I got it. So that doesn't work. So it's it's it's a way to know it and know the knowledge. So knowledge has grown years, ten years, in the last ten years also. And, also, with doctor McLeod and, like I said, with others, with the extension has came with doctor Darlene Breaux and also doctor Henson, who has also worked with us. We also work a lot with the super superintendents, and they come in and help with us and and help us with,
things that don't know exactly what it is, like state state board of education and also the, school board, also to know, what what to do, how to do that, and if you're interested in becoming to be someone to work with the school board. So to make it short, I'm going to let this is one of our this year's this year's. Now remember, this has been a 10 a 10 project this far, so I want I want you to know what does she say it is. Not just me because I'm gonna say it's good because I know I'm working hard,
you know, to make it good. So I wanna make sure that one of them is great. Sure. So what TPi is is it gives us it's a platform that gives us an opportunity to have a seat at the table with all legislators and policyholders, or policymakers. It allows us to analyze, strengthen, and translate policy into practice. So and it comes from experts. So all of us are educators that are a part of it, where it's a select group because you have to apply to become a part. Once you become a part, then they begin to teach you,
one, how to read policy. So we start with the TLO, and we go there. And then once we learn how to do that, then we have to then stand before school board members and get our practice in. And then from there, we have to go into all levels, once the legislature is in in place. So we, we testify in front of all three phases. So we have the house, the senate, and now we're here at the state board. And what we do is we study the policy. So we're actually here to work for you, literally. You know, we're advocacy and we're bipartisan.
So whatever you need, you tell us. We study it. We research it. We give you feedback. And and then you all do what you do, and then we come back, read what you've done, and then we come and testify on behalf of what you've done just like you've heard us do here today so far. And so we wanna make sure that we become practitioners. So the whole goal is to ensure that there is a, positive academic outcomes for all Texas students across the entire state. And so that's what we do. Takes us about, what, two and a half years,
maybe three to try to get this right. So did I miss anything y'all? That's it? Okay. Cool. Okay, guys. Thank y'all for coming. Thank you. You're welcome. Okay. Are there any further questions for the testifiers? Thank you all for coming. Vice Cholera? Mr. Chair, I move that we approve for second reading and final adoption proposed new 19 TAC chapter 127, Texas essential knowledge and skills for career development and career and technical education, subchapter B, high school section 127.15,
career technical education employability skills adopted twenty twenty five, and make an affirmative finding that immediate adoption of the above reference courses is necessary and shall have an effective date of twenty days after filing with the Texas register. Okay. We have a motion to have a second. Second. Second. From member Hickman. Miss mister chair, I also move that we delete the reference to the adopted of 2025 as a technical edit. Second. We have a motion and second from Member Maynard.
Would you like to speak to it? Is there any discussion? Is there any objection, Member Mainer? Would you like a division on this one? Seeing no objection, it is adopted. Are there any other amendments? Ready to vote? K. All those in favor of the main motion as amended, please show by raising your hand. 12. Thank you. All those opposed, 12, zero. The main motion as amended carries. That brings us to agenda item number three for the day, discussion of draft quality rubrics for instructional materials review and approval cycle 2026.
It's in your board agenda, page I-thirty five, posted for discussion today. At this point, I'll introduce Colin from the agency. Thank you. I always forget that. I'm gonna write myself a note. I'm not gonna introduce Colin. Colin doesn't wanna come up yet. We're gonna have public testimony first. We have doctor Sharman Barksdale, Lindy Perkins, and Tijuana Hudson. Thank you. Doctor Barksdale, please. Wendy Perkins? Good afternoon. My name is doctor Lindy Perkins, and I am also a T5 Fellow. In support of item three,
discussion of draft quality rubrics for instructional material review and approval cycle for 2016. It is certainly imperative that students receive high quality instructional materials for ongoing academic challenges and readiness. I am pleased to know that the community and other stakeholders have an opportunity to provide feedback which permits other perspectives related to instructional materials for students. As a strong advocate for item three, I would like to suggest or recommend other components to be considered.
The rubric includes indicators for selecting instructional materials that impact academic behaviors, academic perseverance, academic mindset, and social skills. Ensure instructional materials have intent and purpose so students can become physically and emotionally prepared for school. And lastly, to develop a guide for positive character traits and personal skills that includes a high quality design and support for implementation. With mental health being at the forefront of education, consideration for feedback regarding positive character traits and personal skill has become an essential component
of educating all students. Instilling social emotional competence is a core mission of schools across The United States. The ultimate mission is to graduate students with the academic and life skills necessary to succeed in careers that offer economic and social mobility. Developing a draft for review and approval of tools and resources should be in alignment with the context of a global changing environment. So I wanna thank you for this opportunity to be in support of item three
and to share a voice today on making such recommendation to support what you are currently doing. Thank you so much for this opportunity. Joanna Hudson. Good afternoon, chairman and members of the board. My name is Tijuana Hudson, and I am representing the Texas Education Policy Institute or TPi. Also coming to you from District 13 as a mother of a public school student, a former teacher, counselor, and school administrator currently serving as a district leader overseeing student support services. Today, I am commenting on agenda item three, the discussion of draft quality rubrics for instructional materials review and approval cycle 2026,
specifically for the supplemental k 12 positive character traits and personal skills. Of the more than seven million Texans aged 17 and younger, more than one point two million report having a mental, emotional, or behavioral problem. That's roughly one in five of all Texas youth. This data reflects a real need and an opportunity for our instructional materials to provide more structured support in this area. To that end, I suggest that as you are adopting rubrics, you include indicators that ensure that materials are,
embedding emotional regulation strategies, incorporating culturally affirming stories and perspectives that reflect students' lived experiences, providing scaffolds and adaptations for learners with emotional or behavioral needs, including daily lesson prompts and assessments that connect to character, decision making, and self awareness, and also offering guidance to teachers for the implementation of trauma informed and SEL aligned practices with fidelity. Aligned with the spirit of house bill 100 with emphasizes quality and local oversight, these rubric components ensure that instructional materials support the whole child across all Texas classrooms,
strengthening not only student behavior in classroom climate, but also academic engagement and identity development. When students are taught how to manage their emotions, reflect on choices, and practice empathy, they're more likely to thrive not just in school, but in life. Thank you so much for your time and your dedication. Okay. Members, any questions for the testifiers? Thank you again for being here with us today to testify and help us through this work. Colin, are you ready now? Is a smile yes? Yes. Alright. Calling with a smile for agenda item number three.
Let's see how long it lasts. Alright. Members, while we get the PowerPoint set up, we just handed out this packet. You'll see it as divided into three parts. The first are the slides that I'll be presenting. After the green sheet is the positive character traits quality rubric, followed by the supplemental reading language arts quality rubric behind that one, the next green sheet. So just wanted to let you if you don't have all three parts, let us know because I think I got it mixed up somewhere, and we'll we'll come help you out. For those that are following along at home, or in in the audience here,
these are located these sample rubrics are located on the, SBOE website. You go to sboe.texasspelledout, .gov, You can access the about tab, select instructional materials review and approval, and then click on future Emery cycle 2026, and you'll see the the draft rubric there to access if you would like to follow along at home. So while we get that set up, I'll I'll jump into the, purpose of this item. It is to present for discussion the draft rubric for positive character traits,
grades k through 12, and supplemental reading language arts for grades k through five. The separate exhibits that I shared earlier are the draft rubrics. You may recall that last board meeting, we tackled the first half of these sets of rubrics relating to career and technical education and fine arts. Thank you. Appreciate it. So if you wanna join me on slide four of the PowerPoint, a bit of context here that we have those positive character traits as well as reading language arts rubrics today. And we have reviewed in the past the career and technical education and fine arts materials
in our at our next board meeting. I'll be presenting you the final drafts of career and technical education, fine arts, positive character traits, and supplemental reading language arts, all four of them together, for approval at your next board meeting. Mhmm. Mister chairman, while they're working on that, may I ask him a question? Sure. Alright. You know, just given the the scale of the CTE piece, man, what's that gonna look like in the inward process? I mean, that's a potentially a lot of material. Yes. The career and technical education materials are planned to be batched into three batches.
So we have batch one, which we've now listed out each one of those courses that would be eligible and measured against the rubric that we we plan to bring you all for final approval at the next board meeting. But, yes, it'll be a considerable amount of materials to review. I think I'm encouraged by our progress this year in terms of review capacity going from 142 products to a little over 300 this year. I think we we're hitting our stride in terms of, raising that minimum amount of products that we can review in a given year. And so,
yes, we won't be doing all of CTE, the the entire ecosystem of CTE in one go, but it will accumulate over three years. And then, of course, as soon as the product is is eligible in the review, it can evergreen be able to to apply. But I think there will be some discussion planned at the the next board meeting around the prioritization protocol for materials because we know that we will have lots of folks who are interested in in coming to the Texas market and that know that the way through it is through this MR process. So, I agree with you. It it's a we like solving challenges,
and that's gonna be one that we're we're thinking through between now and and next year. So so just in terms of of of which CTE discipline is gonna go in in which batch have we already determined that? Yes. So for batch one, it's already posted online. So I I have this hyperlink here for for those that are following at home. It's on our ta.texas.gov website under, review and adoption process, the multiyear plan. I list out each one of the courses. I don't have them at the top of my brain at the moment. We can get that list to you.
I think it depended we were waiting on the approval of TEEX just now to determine what batch two would be to make sure that the courses were ready and that publishers would have time to create materials aligned to any modified TEEX. So are employability standards in batch one? I know it's not a course by itself, but that's something that could cut across everything? No. They are not in batch one currently. Batch two? Batch two. I think we've gotten our tech problem solved. So I'll jump back into this part of the presentation. As a as a reminder, the Amber process is cumulative. So in 2024,
we started with math k 12 foundation subjects, English language arts and reading, Spanish language arts and reading, and now have expanded to we're considering the rubrics to use for cycle 2026. They're in the red outlined box. As a product category has an approved rubric, We continue to grow this list through 2031, until we're we're reviewing the entire universe of instructional materials available in Texas. And so, we're down here at the bottom under enrichment subjects. And as a reminder, we had group one at the last board meeting.
We're now on group two, positive character traits and reading language arts supplemental, and we'll bring all four of these together for final approval. But, again, this is your first look at the the sample drafts for group two here on the screen. And then as a reminder, the, MR process has it looks at materials through six different lenses, if you will. The first being standards alignment, the next being that suitability review. These rubrics are aligned to the quality review of the materials. And so this is important to emphasize for positive character traits. There's the the TEKS component,
which is we're measuring if the materials cover those TEKS. Yes or no. The quality review is about the how. How is a teacher implementing these materials? What are the best practices for instruction? And we'll find that in the quality review. So the rubrics that we're looking at today, will not measure TEKS alignment. That's a separate part of the process. Rather, this is the how some a teacher would be prepared, students would be prepared to, to gain all that knowledge. And then, of course, we we include as part of our review, factual error review, the physical and electronic specifications, and compliance with the parent portal should the materials be approved,
by the board. And then as a reminder of the the general, outline of our rubrics, they have two main sections. Section one is the implementation quality section. We try and keep this section the same across any content area. So, the same for math as it is for reading as it is for positive character traits or for supplemental products. And the the we're trying to understand, are the components that support are the components there or existing materials that support effective implementation, in these materials?
And then we have the learning quality section, and these this section is unique for the content area. So this will look different in English than it does for math, as an example. And, learning quality, will review the component quality aligned with research on the best ways to teach any particular subject. So what is the best way to teach math? Do the materials reflect that, that brain science there? And, when taught as designed, do the components support a student in reaching grade level proficiency on the standard? So we've we've split all of our rubrics into these two sections.
Again, the one on the left hand side, is the the green section of your rubric. Sorry. The purple section of your rubric. And then and then we have our learning quality. So with that, I'm gonna jump into just a brief overview starting on slide nine of the quality rubric for positive character traits. And then we'll go to reading language arts supplemental, and then I'll wrap with an outline of what are the next steps from here, and then happy to take questions about about both of these. So as a reminder, instructional materials quality rubrics can be applied towards one of the three categories of an
instructional material. On the far left hand side, we have full subject tier one products. These are materials designed to provide a student with mastery of the takes of a certain a particular subject and grade level, but it should be everything that you might need. Right? This is everything in the kitchen sink that you'd need to, for a child to learn and a teacher to teach using these materials. This is your core and set of instructional materials when it's a tier one product. On the other end of the spectrum are supplemental products, which are used to supplement, hence the name, your full subject tier one products.
And so, when we look at positive character traits, it's it would apply to both. There are some publishers that have supplemental products that only cover a a portion of those TEKS or maybe a particular grade band of those TEKS, and then we have full subject tier one products that that cover from kinder through twelfth as the as the TEKS have. So wanted to point that out that this is a rubric that would apply to both types of product categories. And then I also wanted to remind folks about where hey. Where did these come from? Positive character traits ticks, were became effective in the code in August of twenty one and then were required
to be implemented in classrooms beginning with the twenty twenty one, twenty twenty two school year in accordance with the rules adopted by this body, the character traits are broken up into the following grade bands. There's a kendo through second grade, a third through fifth, a sixth through eighth, and a nine through 12 grade band. Schools, may provide the required instruction in a variety of arrangements, so there's not one set way, including they can make it a stand alone course, or they can choose to integrate these lessons into their existing schedule, depending on how they want to apply it, but it needs to be taught at least once during,
each one of these grade bands. So they might cover all of those takes in kindergarten, and then wait till third grade to do it again, or they can sprinkle it throughout. But that that's up to districts how they implement it. And so you'll see, in our rubric approach that we allowed for flexibility because we know that these these lessons and materials could be applied in a variety of ways, depending on how the school district plans to to implement those materials. The standards for positive character traits and personal skills are comprised of four main strands. The first is trustworthiness, followed by responsibility, caring, and then citizenship. And so let's look at that first section of the rubric.
So if you'll join me in the sample rubric, which would be page 40 in your packet. We first have the implementation quality section, that purple section. And I think the difference in the implementation quality section from our other rubrics here is that we have revised, revised this intentional instructional design to be more inclusive of multiple types of educators. Our other rubrics say exclusively teacher or exclusively accounts or exclusively an admin. So we wanted to expand the definition to educator because of the way that these materials are applied and make sure that publishers who have products out there aren't dinged
if, they don't say it's for the teacher specifically, but maybe it is, from another peer leader or from from other folks that are are in the educational space. We also expand again, expanded the application so that it can be used as a stand alone course. Maybe it's one mini lessons for for sixty minutes. Right? Or it is integrated into existing curriculum that a district may already have. And so, those were the updates and and how it is different from our other rubrics that you've already approved that we're already applying, as part of the MR process. For progress monitoring,
we also took a broader approach. Progress monitoring in this set of standards is different, than it would be maybe for math or reading. And so, we wanted to make sure that we expanded the scope here to include goal setting and self assessment for a student when it comes to positive character traits, and and not think about this as traditional formative or summative assessments, which is what the language was for our other rubrics. So we've expanded that vocabulary there to be inclusive of of products in this product category. When When it comes to learning quality, member Hickman, you will appreciate this.
We're very short and to the point on this rubric. We have, instructional practices broken into direct instruction and then intentional practice. So we want students to be taught the lesson, and then, we want them to intentionally practice those skills. And so, again, made sure that we pare down this rubric so that we're we're only looking for those things knowing that we also have the the suitability component from the suitability rubric and the TEKS alignment component from that part of the review, and and pared this down significantly. With intentional practice, we wanna make sure, we believe that high quality instruction materials give students an opportunity to practice and then
also apply those skills beyond the lesson. So, more than a fifteen minute lesson on trustworthiness, but how can you apply that to, maybe a lesson at the end of the day when when the teacher, is talking about trustworthiness and being able or sorry, encouraging students to generalize their learning across their day and to apply it towards different times during the day throughout the year and not just having it be isolated to that fifteen minute lesson. And so those are the the the main updates from traditional rubrics that we've presented to you all in the past. Of course, we can dive into them and with specific questions.
But, again, wanted to emphasize that I think a lot of things might come up on the suitability rubric related to appropriateness in this product category. That's different maybe from reading language arts or from mathematics, just because we're dealing with positive character traits, and and that seems to be, something that would be covered by the suitability rubric, especially. So a couple of guiding questions for for us here, and we'll come back to these. But, do you feel like this draft quality rubric would apply equally across those grade levels? If so, great. If not, please let us know, and we can talk through that.
And do the updates to the implementation quality indicators address the varied landscape of positive character traits and materials. Right? We we know it's not a one size fits all, and so we wanna make sure that the way that we've drafted the rubric meets those publishers' needs, but also doesn't lower the bar for quality when it comes to this product category out in the field. And so I'll pause there on positive character traits and ask if there's any questions about the initial draft or concerns knowing that we'll we'll also wrap up with what's next for getting public feedback on these drafts.
Mister Hickman. Thank you. And this looks much shorter than the last rubric, so thank you. I think we're heading in the right direction. Just a question. I know we've talked before. We have these indicators. Can you talk a bit about the report and how long the report's going to be and kind of the format of the report? Do you have that in mind yet as you're developing the rubric? We're actively, revising the report for even the SIMR cycle so that it is a better user experience for for y'all as members and for the general public. And in general, we're we're looking at a way for folks to be able to filter to a
view that they prefer. So if you are a high level person and just wanna see the headlines versus someone who wants to drill down and see all of the details, we're we're building the system so that you can do both, and and you can suit your own needs in terms of report specificity. But we haven't I don't have mock ups, if you will, of of the final report yet, but it this one would conceivably be much shorter because there are fewer rubric indicators. Okay. So for for my personal use, I won't speak for the board, a single page with the roll up and the come how the score and then
if there's any deal breakers. I know we had a red flag last time, so that would be helpful for me personally deciding thumbs up, thumbs down on each of those materials. The other thing I'll mention, I don't know if I mentioned it last meeting, I did some polling around District 6, and I didn't meet anyone who was looking for 200 pages of detail at an ISD. So I want to be sure the reports that we're generating are tailored to the target audience and the level of detail that those people who decide which textbooks to use in different school districts, we're giving them enough and not too much.
Because if we're generating 200 pages and they only need 10, I'm not sure what that extra 190 pages is getting anyone. So, just my 2¢ from the cheap seats, and I'll leave it there. Thank you. Doctor Bill Madero. I guess I'm wondering how you're going to deal with some of the, subtleties of good personality traits or good qualities. I mean, you know, being honest, I would think, would be one, and being, kind. And sometimes those come into con conflict. You know, you don't sell somebody that's an ugly hat you're wearing even though that's honest.
So how do you deal with those kind of fine points? Trying to get to our slide here. That will be managed through Teek's alignment. So that's very well defined, which traits how they should be taught is defined in the student expectations for positive character traits. So there that's already settled. This rubric is is only going to measure, how we're teaching what's in the TEKS. And so when it comes to the content that should be used, that's that's defined in chapter one twenty. And so that's that's what we'll be following, and that's what reviewers will be assessing if if trustworthiness is presented in the way
that it's presented in the TEKS. Yes or no. And then this quality rubric will be the the how a teacher is prepared to teach those lessons, and how students would would learn them. But I think the I acknowledge that, yes, there is subtlety there as with all of our product reviews, but that the majority of the content is coming from the tics, which this board has deliberated before, and won't necessarily be something that our quality reviewers are focused on. Thank you. Member Pickering. Thank you. Colin, I just I have a question about, why.
Because throughout SVOE seven, a lot of my school districts, they handle this, you know, I would say in home room class or advisory period. It's, you know, it's these, what is it, ten, eleven character traits that kinda address throughout the year in, you know, just a few minutes. And so and there's nothing in statute that requires school districts to have, character traits materials or SEL materials. So I'm just questioning as why. There there is a requirement for school districts to affirm that they procured or have
materials on hand that cover all of the TEKS regardless of whether they're they're enrichment courses or or foundational courses. And so that's where this one falls, under the requirement. Now those can be self created. Those can be created by the district. And I think the reason why we're we're providing a rubric is that it it's our charge at the agency to have a rubric for everything under the sun, so that a district can make that decision of do we wanna use something off of this board's list if you all approve it. I think equally so, you have the opportunity now at the passage of house bill 100 from last session to put things on the rejected list,
and districts are are now, not able to it's not effective yet. But at the point that that bill is effective, not able to purchase with any funds or to adopt locally materials that are placed on the rejected list. And so I think that's the why is that the agency is charged to to make these rubrics for all materials under the sun. And I think from from your vantage point, it's the ability to make sure that things that are approved are high quality and things that are rejected are are a warning for districts. Hey. Don't use this because we don't think it's appropriate. Okay. So, like, if, you know, several of school districts,
it's literally just these character traits put up on, you know, pretty sheets of paper around the homeroom class where the teacher discusses it so many minutes around the week. So are they gonna have to get that approved through us to put up their character traits, signs on their oh, that's what I'm asking. How is this gonna work where our school districts don't have to spend more money, but they're already successfully doing this? No one is required to submit their materials, especially teachers, to the Emera process. It's voluntary unless the board requires a product from a publisher to be reviewed. And so it's it's not going to prevent districts from creating their own materials.
Just not being on the approved list doesn't give you access to, the new entitlement funding from house bill 16 o five last session. So there's no penalty for for using materials that a district might already have. It's just they they close the door on potential funding for approved instruction materials that they don't choose from that list. And then refresh my memory because, it's been a little while since I read, the 60 something pages of house bill 16 o five. But was there anything in 16 o five that dealt solely with tier one instruction, which I don't believe this falls into?
It defined house bill 16 o five five defined those three product categories that I have on screen. I redefined them rather. It and that's my recollection of tier one instruction involved with that bill, but I also Right. Because you said unlocking their I met, funding. I thought 16 o five funding was tied to tier one instruction, which this is not. It's not solely tied to tier one instruction. It it's tied to all, instructional materials that would be reviewed and approved by this body. That's my understanding. If I'm incorrect, please. No. It's been so long. So like I said, I read with the 67, 68 pages.
I can That's a whole session ago. Yeah. Yeah. I understand. Okay. Thank you. Any other questions, members? Okay. We can move on. Alright. So now we'll jump to supplemental reading language arts. So you'll recall that we have a full subject tier one reading language arts rubric. And now we're going to look at a supplemental reading language arts quality rubric. And as a reminder, these are materials that are not intended to be the only instruction material in a classroom. Right? You have already reviewed materials that are meant to be applied towards poor instruction or
tier one instruction, and these supplemental materials are designed to assist in the instruction of one or more, student expectations or in a particular subject. And so that's the the realm of instruction materials we plan to review with this rubric. And so looking at how is this rubric different from the full subject reading language arts, well, first, in implementation quality, we're wanting to make sure that the material is designed to supplement core instruction to my point. You can't tier two your way out of a bad tier one instructional materials problem. So if you don't have a strong full subject tier one product,
supplemental materials will not save you, but they should be designed to supplement a strong core instructional product. And so we wanna make sure that we're not getting back to a place of cobbling together a bunch of supplemental materials to be the main instructional material set of instructional materials in a classroom. We know that that's not how these materials are designed, and so our rubric reflects that emphasis that this should be a supporting player in the world of instructional materials and not the the sole way to instruct children or support teachers. The other improvements we've made to this rubric from its full subject counterpart are around
the varying types of supplemental programs, So making sure that there's lots of ways that people can apply supplemental materials. It could be for enrichment. It could be to catch a student up, targeted remediation or acceleration. And so we wanted to make sure that our rubric was inclusive of those different applications and that we weren't excluding quality products just because they were designed solely for enrichment versus the application of targeted remediation. And to the same point, supplemental is a varying landscape of who's doing the teaching. Sometimes it is, an application, where it is student led.
Other times, it is an educator led platform, where the the teacher is standing delivering lessons with students or facilitating lessons with students. So we wanna make sure again that this rubric was inclusive of the landscape of materials out there for supplemental reading language arts. And this is the one, where I I wanna key in everybody because learning quality is a a section that we've modified, especially for supplemental reading that I think, well, is a change a departure from where what we've done before. And so on the screen, you'll see what we've identified as the six main learning quality indicators,
foundational skills, vocabulary, fluency, handwriting, reading comprehension, and writing. And, when we have a full subject tier one product in this learning quality section, a publisher is required to hit all parts and and score on all parts of the rubric. We are proposing that for supplemental products, we, at the agency, when when conducting the review on y'all's behalf, would allow the publisher to identify which of these six, and they can select more than one, their product is designed. Right? So if I'm a publisher with I've only developed a vocabulary product, I don't think that I should be measured against the writing or handwriting learning quality
standards. And so, giving publishers the opportunity to say, I designed my product for foundational skills, and vocabulary, but not for these other things and having our reports and approval reflect that. And we we've heard feedback from the the reading publisher community that that this is much more preferred rather than trying to design a product that covers all things because then you're getting into a tier one product territory. And so supplemental products are very much designed on skills, and so we wanted the rubric to reflect that as well. So we did a similar thing with mathematics around TEKS alignment where publishers said,
I'm a supplemental publisher for math. I only do math facts. We only require them to cover the math facts section of the TEKS. And now we're taking a similar approach with our learning quality rubric for reading language arts. And so, again, I wanna emphasize this as a departure from other rubrics that you have approved that your approval of materials in this category would be contingent upon, you know, an application of just for foundational skills or only for fluency for the board's approval or rejection. I'll pause there because there might be questions.
Questions. Member Hickman? This may get into something we should take offline, but does the whole education industry in Texas agree these are the components of learning quality and that all the ISDs would say, yeah, those are the right criteria to check off? Or kind of where did these come from? Great question. These came from our internal staff, and also building with our contractor group of internal subject matter experts. Following this meeting, at the end of this PowerPoint, are links for community engagement meetings with parents,
teachers, educators, publishers, to see if we got it right and to have them tell us, hey. We actually don't think handwriting should be broken out or, perhaps we should combine writing and reading comprehension because we feel that they're, you know, like addition and subtraction, and you need to have them together. But this was our our first draft for folks to react to. So, I think they're really good. I think they're they're strong six. And but, yes, we have some community engagement following this meeting, to ensure that we that we may got it right and then come back to
you all in September with those results. Okay. So I'll just echo my comments of earlier. You can apply those to this one as well. Noted. Yes, sir. And I'll tell you next meeting too. Alright. So I'll jump to process. So on the screen, we have the, red boxes. Those were part of group one. That was our CTE and fine arts rubrics. We have, since April, been conducting focus groups and had an open public comment period on those rubric drafts. The blue boxes are the drafts that are in front of you now. So after I think starting next week,
we're going to begin focus groups for parents and community members, as well as educators, EFCs, and publishers. We'll also, starting today, open up that public comment period for these rubrics. So to member Hickman's point, if someone has a strong point of view on what those quality, quality sections should be, they should encourage you all to reach out and and let us know. That's how we improve our rubrics to get to a better inward process. All of that culminating in September where we'll bring all four rubrics here for y'all's approval, to be used in Emmer Cycle 2026. And so when we're doing these stakeholder engagement communications,
these are the the groups and and folks that we're reaching out to. We had a strong response for CTE and fine arts folks. A lot of people came out for those, and so we're excited to start engaging with more publishers and and parents and community members to make sure that these rubrics are also hitting the mark. We will send this to you all in an email so that you can share it out with your constituents, but we have, our our planned links are already up and on the SBA website for folks to sign up. Member Clark, to your point from last time, we've we've ensured that the parents and community sections or sorry,
sessions are during a time when parents and community members are are more free and available. And so we've we've got those up here for positive character traits as well for reading language arts supplemental. And so these will be running concurrently as we're gathering feedback from publishers, community members, parents, ESE specialists, and educators to ensure that we've really hit the right mark with this quality rubric. And, again, we'll be taking feedback through August 23 on, these particular rubric drafts, and that public comment submission form is posted there. It's also on the website that I mentioned earlier.
Going to the, SBOE website, navigating to instruction materials review and approval and clicking on IMRA 2026, and you'll see this form. And then, again, we'll we'll come back in September, sharing with you member There's the final drafts that have been revised based on feedback from these focus groups. If you have information you'd like to share with us, like, here or or later this week will be around, in order to make sure, again, that we all get to the the best drafts possible for these rubrics, and then then they can be ready for approval in September. So that is the the that's my presentation.
I'm happy to take questions or or answer anything about process or even the rubric drafts themselves. Any questions? Member mayor? Yep. I did go on the website. I saw I saw how you have the CTE badge, by the way. So it is on the I just find it on the website. Yep. Anyone else? Thank you for calling. Thank you, sir. All right, that moves us along to item number five for the day. Discussion of pending litigation. Vaughn? There is no update on that. No action since last time. Great. Shortest item of the day. Alright. That concludes the agenda for today.
No way. We'll be back here at 9AM tomorrow morning to, hear from the commissioner. So I'll see you at nine in the morning.