January 13, 2022 - Introduced by Senators Darling and Cowles, cosponsored by
Representatives Wittke, Born, Macco, Cabral-Guevara, Drake, Gundrum,
Katsma, Knodl, Kuglitsch, Magnafici, Murphy, Sinicki, Steffen and
Kerkman. Referred to Committee on Transportation and Local Government.

SB863,1,5 1An Act to repeal 25.18 (1) (o) and (p); to renumber and amend 25.167 and
225.187 (1); to amend 25.156 (3) and (4), 25.16 (2) and (3), 25.165 (2) (c), 25.17
3(3) (b) 3., 25.17 (3) (dg) 2., 25.17 (70) (intro.), 25.18 (1) (intro.), (a), (f) and (m)
4and 25.183 (3); and to create 25.167 (2m), 25.187 (1) (b) and (c) and 25.187 (4)
5of the statutes; relating to: investment board operations.

This bill makes various changes relating to the State of Wisconsin Investment
Board.

Under current law, among its powers and duties, SWIB may do any of the
following:

1. Employ special legal or investment counsel in any matters arising out of the
scope of its investment authority, notwithstanding certain other statutory provisions
relating to state procurement and state agency employment of attorneys, but
employment of special legal counsel paid by SWIB must be with the consent of the
attorney general.

2. Execute certain indemnification agreements related to securities.

3. Secure insurance against risks relating to SWIB's investments or properties.

4. Liquidate any corporation wholly owned by SWIB or operate the corporation
for up to five years until it can be liquidated.

5. Take necessary action to make investments in mortgage loans or purchase
real estate interests.

6. Maintain and repair any building that SWIB owns in fee or in which SWIB
owns the beneficial interest and, notwithstanding certain other statutory provisions
relating to state procurement or engineering, have exclusive authority to contract as
SWIB deems necessary for this purpose.

7. Engage in certain types of securities lending and repurchase agreement
transactions.

8. Sell securities that SWIB has the right to acquire by exercising conversion
rights.

9. Employ professionals, contractors, or other agents necessary to evaluate or
operate any property if a fund managed by SWIB has an interest in, or is considering
purchasing or lending money based upon the value of, that property,
notwithstanding certain other statutory provisions relating to state procurement.

10. For specified purposes, enter into certain swap transactions.

11. Invest assets of the permanent endowment fund in any investment that is
authorized for Wisconsin Retirement System accounts or in certain other
investments related to tobacco settlement revenues.

This bill specifies that SWIB's authorization, as provided in items 1 to 11, above,
applies notwithstanding any other statute except one restricting SWIB's investment
in certain derivatives and reverse repurchase agreements. The bill also modifies this
authorization as follows: with respect to item 1, it removes the attorney general
consent requirement and authorizes SWIB to employ special legal or investment
counsel in any matters arising out of the scope of its operations, not just investment
authority; with respect to item 6, it expands the authorized activities to include a
leasehold interest and to include, among others, improving, occupying, and
furnishing the building; and it repeals the provisions creating the authorization
under item 11.

The bill also makes changes related to SWIB's funding of operating expenses.
Current law defines, for certain purposes, SWIB's “operating expenditures" to
include all costs and expenses incurred by SWIB for the purpose of operating SWIB
and managing the assets of each fund for which SWIB has management
responsibility, but excludes certain costs or expenses such as those related to the
following: employing special legal or investment counsel; securing insurance against
certain risks; and contracting with external managers to manage SWIB's assets.
These costs and expenses excluded from the definition of “operating expenditures”
and are paid from the fund for which the costs or expenses are incurred.