2019 - 2020 LEGISLATURE
February 28, 2019 - Introduced by
Joint Legislative Council. Referred to
Committee on Ways and Means.
AB49,1,4
1An Act to amend 20.507 (1) (h), 20.536 (1) (k), 24.61 (2) (c), 25.17 (1) (afp), 25.17
2(1) (axp), 25.17 (1) (kd) and 25.17 (1) (xLc) of the statutes;
relating to: the
3authority of the Board of Commissioners of Public Lands to delegate authority
4to invest trust fund moneys and making an appropriation.
Analysis by the Legislative Reference Bureau
This bill is explained in the Notes provided by the Joint Legislative Council in
the bill.
For further information see the state and local fiscal estimate, which will be
printed as an appendix to this bill.
The people of the state of Wisconsin, represented in senate and assembly, do
enact as follows:
Joint Legislative Council prefatory note: Current law generally authorizes the
Board of Commissioners of Public Lands (BCPL) to invest the Common, Normal,
University, and Agricultural College Funds (school trust funds) in any type of
investment, as long as it invests “with the care an ordinary prudent person in a like
position would exercise under similar circumstances” in accordance with the standard of
conduct for investing an institutional fund.
Under current law, the BCPL is authorized to delegate to the State of Wisconsin
Investment Board (SWIB) the authority to invest part or all of the moneys belonging to
the school trust funds. However, SWIB may invest the moneys only in fixed income
investments or in funds that invest only in fixed income instruments.
Under this bill, the BCPL may contract with SWIB to invest school trust fund
moneys, SWIB may be compensated as provided for in the contract, and SWIB may invest
the moneys in accordance with the standard that applies to SWIB's investment of the
other funds under its management. This standard requires that SWIB: (1) manage the
moneys as would a prudent person acting in a similar situation; (2) adequately diversify
investments; and (3) administer trust fund moneys for the purpose of ensuring the
fulfillment of the purpose of each trust fund, at a reasonable cost.
AB49,1
1Section
1. 20.507 (1) (h) of the statutes is amended to read:
AB49,2,122
20.507
(1) (h)
Trust lands and investments — general program operations. The
3amounts in the schedule for the general program operations of the board as provided
4under ss. 24.04, 24.09 (1) (bm), 24.53
, 24.61 (2) (c), and 24.62 (1). All amounts
5deducted from the gross receipts of the appropriate funds as provided under ss. 24.04,
624.09 (1) (bm), 24.53
, and 24.62 (1) shall be credited to this appropriation account.
7Notwithstanding s. 20.001 (3) (a), the unencumbered balance at the end of each fiscal
8year shall be transferred to the trust funds, as defined under s. 24.60 (5). The amount
9transferred to each trust fund, as defined under s. 24.60 (5), shall bear the same
10proportion to the total amount transferred to the trust funds that the gross receipts
11of that trust fund bears to the total gross receipts credited to this appropriation
12account during that fiscal year.
AB49,2
13Section
2. 20.536 (1) (k) of the statutes is amended to read:
AB49,2,1714
20.536
(1) (k)
General program operations. All moneys received from
15assessments made under s. 25.187 (2) and from charges made under s. 25.17 (9)
, and
16from contracts entered into under s. 24.61 (2) (c), for the purpose of conducting
17general program operations.
AB49,3
18Section
3. 24.61 (2) (c) of the statutes is amended to read:
AB49,3,719
24.61
(2) (c)
Delegation of investment authority to Contracting with investment
20board. The board
of commissioners of public lands may
delegate to contract with the
21investment board
the authority to invest part or all of the moneys belonging to the
1trust funds. If the board
delegates the authority, of commissioners of public lands 2contracts with the investment board
, the investment board may invest the moneys
3belonging to the trust funds in
any fixed income investment or fund that invests only
4in fixed income instruments accordance with the investment board's standard of
5responsibility specified in s. 25.15 (2). All moneys received by the investment board
6under this paragraph shall be credited to the appropriation account under s. 20.536
7(1) (k).
AB49,4
8Section
4. 25.17 (1) (afp) of the statutes is amended to read:
AB49,3,109
25.17
(1) (afp) Agricultural college fund (s. 24.82), but subject to the terms of
10delegation the contract under s. 24.61 (2) (c);
AB49,5
11Section
5. 25.17 (1) (axp) of the statutes is amended to read:
AB49,3,1312
25.17
(1) (axp) Common school fund (s. 24.76), but subject to the terms of
13delegation the contract under s. 24.61 (2) (c);
AB49,6
14Section
6. 25.17 (1) (kd) of the statutes is amended to read:
AB49,3,1615
25.17
(1) (kd) Normal school fund (s. 24.80), but subject to the terms of
16delegation the contract under s. 24.61 (2) (c);
AB49,7
17Section
7. 25.17 (1) (xLc) of the statutes is amended to read:
AB49,3,1918
25.17
(1) (xLc) University fund (s. 24.81), but subject to the terms of
delegation 19the contract under s. 24.61 (2) (c);
