Texas Permanent School Fund

What Texas Permanent School Fund does

Texas Permanent School Fund Corporation (Texas PSF) is a special-purpose governmental corporation headquartered in Austin, Texas, that manages an endowment exceeding $67 billion to provide permanent funding for the state's K-12 public schools. Established by Article 7 of the Texas Constitution in 1845 and seeded with $2 million by the Texas Legislature in 1854, the fund has grown for 180 years through investment returns and mineral royalty revenues from 13+ million acres of state land. In 2021, the 87th Texas Legislature passed Senate Bill 1232, and in 2023 the PSF's assets and operations were transferred to the newly created Texas PSF Corporation to unify previously bifurcated governance between the State Board of Education and the General Land Office.

The corporation's two primary product lines are (1) biennial distributions from the Available School Fund totaling $4.8 billion for the 2026-27 biennium, allocated to Texas public school and charter districts based on average daily attendance, and (2) the Bond Guarantee Program, which leverages the fund's AAA credit ratings from Moody's, S&P, and Fitch to guarantee $143-144 billion in school district bonds for 900+ districts, saving taxpayers an estimated $400 million annually in borrowing costs. The fund invests across public equities, fixed income, private equity, real estate, natural resources, infrastructure, and absolute return strategies, increasingly through external managers and direct co-investments.

Texas PSF is not a revenue-generating enterprise in the commercial sense; its financial mechanics are those of a sovereign endowment. Distributions to schools are constitutionally mandated rather than market-priced, and the fund charges no fees. Governance is provided by a nine-member Board of Directors appointed from the State Board of Education, the Land Commissioner, and the Governor, with Robert Borden serving as CEO and CIO directing all investment and operations activities.

Name

Texas Permanent School Fund

Legal name

Texas Permanent School Fund Corporation

Website

https://texaspsf.org

Company type

Private

Founded year

1845

Operating status

Operating

Headcount range

51–100 employees

Short description

Texas Permanent School Fund Corporation is an Austin-based, constitutionally created sovereign endowment managing over $67 billion to fund Texas K-12 public schools through biennial Available School Fund distributions and an AAA-rated Bond Guarantee Program backing $143-144 billion in district debt for 900+ districts.

Ownership category

akta.pro rank

Product category

Public Education Endowment Management

NAICS

Educational Support Services (611710)

SIC

Investment Advice (6282)

akta.pro primary industry

Endowments (Universities, Foundations, Nonprofits) (FSAAAGAC)

Keywords

• Sovereign wealth fund
• Public education endowment
• Investment portfolio management
• Bond guarantee program
• Endowment fund management

Headquarters

HQ city

Austin

HQ country

United States

HQ region

North America

Offices1 record

Markets served

GTM type

B2B

Offering type

Services

Cost components

Personnel, Operations, Technology or R&D, Others

Revenue model

1. Investment Returns: The fund generates returns through diversified investment portfolio management across public equities, fixed income, private equity, real estate, natural resources, infrastructure, and absolute return strategies. Returns are reinvested and distributed to support Texas public education.

Distribution channels2 records

Marketing channels4 records

Core offering

Texas Permanent School Fund is a perpetual sovereign endowment that manages more than $60 billion in assets across diversified asset classes (public equities, fixed income, private equity, real estate, natural resources, infrastructure, and absolute return strategies) to generate investment returns distributed to Texas public schools. The fund also administers the Bond Guarantee Program, providing AAA-rated credit backing that reduces borrowing costs for more than 900 Texas school and charter districts. Annual distributions exceed $2.4 billion to K-12 education while guaranteeing over $143 billion in outstanding district bonds.

Product overview

Texas Permanent School Fund is a sovereign wealth fund and endowment that manages approximately $60 billion in assets to support Texas public schools. The Fund offers investment management services across multiple asset classes including public equities, fixed income, private equity, real estate, and infrastructure. The primary financial product is the Bond Guarantee Program (BGP), which leverages the Fund's AAA credit rating to guarantee school district bonds, reducing borrowing costs for Texas schools. The Fund also distributes annual payments to the Available School Fund for K-12 education support.

Differentiator

Problem solved

Functional benefit

Products and services

• Bond Guarantee Program A program that provides AAA/Aaa credit backing to eligible Texas school and charter district bonds, reducing their borrowing costs and helping fund school construction, renovation, and expansion. The program backs more than $143 billion in bonds issued by over 900 Texas school and charter districts, with over 8,000 bond projects guaranteed since 1983 and an estimated $400 million in annual savings to districts and taxpayers.
• Available School Fund Distributions Biennial distributions to Texas K-12 public schools and charter schools based on prior-year average daily attendance (ADA), funding instructional materials, technology, and educational expenses. Annual distributions total over $2.4 billion, supporting Texas public education from a constitutionally mandated perpetual endowment.
• Investment Portfolio Management Diversified investment management across public equities, fixed income, private equity, real estate, natural resources, infrastructure, and absolute return strategies, managing more than $60 billion in assets to generate returns that fund Texas public schools.

Quantifiable outcome

• Delivers $2.4 billion annually to Texas K-12 schools
• +3 more outcomes

Named customers2 records

Segments2 records

Ideal customer profiles2 records

Technology focussed No

API detail

Has API

No

API docs

API detail

Core technology

AI maturity

App detail

Partnerships

One partnership is on record.

• Racing AmericaminorStrategic or Co-development Partner · 10 December 2025Texas PSF Corporation originated the opportunity for Parella Motorsports Holdings to acquire Racing America through its relationship with Racing America's former ownership group. This represents the fund's alternative investment strategy in sports/media.

Scale indicators8 records

Recent moves8 records

Expansion highlights5 records

Others

• BlackRock: BlackRock is a major external manager (and former partner) for Texas PSF, providing investment management services across public equities, fixed income, and alternatives. As the largest asset manager globally, it serves as both an incumbent supplier and a benchmark for in-house versus outsourced institutional investment capabilities.
• State Street Corporation: State Street is a major custody, ETF, and asset management partner to Texas PSF (PSF holds a $740M+ position in State Street's private credit ETF). It is comparable as a major institutional financial infrastructure provider used by sovereign and pension funds.

Direct peers

• CalSTRS (California State Teachers' Retirement System): CalSTRS is the largest U.S. teacher pension fund and directly parallels PSF in mission — providing retirement/benefit funding for educators. Like PSF, it operates with a large internal investment team and external manager partnerships across multiple asset classes.
• CalPERS (California Public Employees' Retirement System): CalPERS is one of the largest U.S. public pension funds, with comparable scale (~$500B AUM), governance structure, and institutional asset allocation approach. Both funds manage defined-benefit liabilities and share a similar investment philosophy and external manager model.
• State Board of Administration of Florida (Florida SBA): Florida SBA manages multiple state trust funds including Florida's K-12 education investment program. It shares the multi-fund, multi-mission institutional investor structure comparable to Texas PSF.
• Teacher Retirement System of Texas (TRS): TRS is another large Texas state pension/retirement system with an institutional asset management mandate. It is highly comparable as a Texas-based state sovereign fund that pools capital to provide defined benefits, with overlapping governance and investment universe with Texas PSF.
• New Mexico State Investment Council: SIC manages New Mexico's permanent funds, including land grant and severance tax permanent funds, with a similar model to PSF of investing royalty-derived capital for the benefit of public education and other state beneficiaries.
• Permanent School Fund of New Mexico: New Mexico's Permanent School Fund is one of only a handful of state-level permanent school funds in the U.S., with a directly analogous mission of funding public K-12 education through investment returns on state trust lands.
• University of Texas/Texas A&M Investment Management Company (UTIMCO): UTIMCO manages the endowments of the University of Texas and Texas A&M Systems, with a comparable institutional asset management mandate for public education in Texas. It shares similar asset classes (PE, real estate, public equities) and reports to a state-level board, making it a direct operational peer.
• Alaska Permanent Fund Corporation: Alaska Permanent Fund is a sovereign wealth fund capitalized by mineral/royalty revenues from state lands, mirroring PSF's historical funding model. Both are state constitutional funds investing natural-resource-derived capital for long-term public benefit.

Market position

Strengths5 records

Weaknesses5 records

Competitive moat5 records

Key risks6 records

Key highlights7 records

Customer concentration

• LinkedInlinkedin.com/company/texas-permanent-school-fund-corporation

Compliance3 records

Revenue estimate

Valuation estimate

Number of profiles

Profiles7 records

Funding overview

Funding rounds

Investors

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M&A

Investments

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Frequently asked questions about Texas Permanent School Fund