Okla. Stat. tit. 64, § 64-1013

educational funds.

A. The Commissioners of the Land Office shall be responsible

for the investment of the permanent school funds, other educational

funds and public building funds solely in the best interests of the

current and future beneficiaries. The Commissioners of the Land

Office shall make investments:

1. For the exclusive purpose of:

a. providing maximum benefits to current and future

beneficiaries, and

b. defraying reasonable expenses of administering the

trust funds;

2. With the care, skill, prudence and diligence under the

circumstances then prevailing that a prudent person acting in a like

enterprise of a like character and with like aims would use; and

Oklahoma Statutes - Title 64. Public Lands Page 31

3. By diversifying the investments of the trust funds so as to

minimize the risk of large losses.

B. The permanent school fund and other educational funds may

only be invested in bonds issued in the United States, United States

dollar denominated or other investments settled in United States

dollars or traded on the United States exchange markets and real

property to be owned or acquired by the Commissioners of the Land

Office. The Commissioners of the Land Office shall not invest more

than sixty percent (60%) of the trust fund investments in equity

securities. The Commissioners of the Land Office are further

authorized to acquire, purchase, exchange and grant any real

property under its jurisdiction as is necessary to carry out the

investment in the real property. The Commissioners of the Land

Office shall not invest more than five percent (5%) of the total

value of the assets of the permanent school funds in connection with

investments in real property. The calculation of investments in

real property within the five percent (5%) cap shall not include the

value of real property under long-term lease to the State of

Oklahoma, agencies of the state or subdivisions thereof. In no case

shall the Commissioners of the Land Office bid against private-

sector bidders above the appraised value of any property to be

acquired.

C. The Commissioners shall establish an investment committee.

The investment committee shall be composed of not more than three

members of the Commissioners of the Land Office or their designees.

The committee shall make recommendations to the Commissioners of the

Land Office on all matters related to the choice of managers of the

assets of the funds, on the establishment of investment and fund

management guidelines, and in planning future investment policy.

The committee shall have no authority to act on behalf of the

Commissioners of the Land Office in any circumstances whatsoever.

No recommendations of the committee shall have effect as an action

of the Commissioners of the Land Office or take effect without the

approval of the Commissioners as provided by law. The Commissioners

shall promulgate and adopt on an annual basis an investment plan.

The investment plan shall state the criteria for selecting

investment managers, the allocation of assets among investment

managers, and established standards of investment and fund

management.

D. The Commissioners shall retain qualified investment managers

to provide for investment of the fund monies and for the management

of investment real property pursuant to the investment plan.

Investment managers shall be chosen by a solicitation of proposals

on a competitive bid basis pursuant to standards set by the

Commissioners. Subject to the investment plan, each investment

manager shall have full discretion in the management of the funds or

investment real property allocated to the investment managers. The

Oklahoma Statutes - Title 64. Public Lands Page 32

funds allocated to investment managers shall be actively managed by

them, which may include selling investments and realizing losses if

the action is considered advantageous to longer term return
investment

manager shall have full discretion in the management of the funds or

investment real property allocated to the investment managers. The

Oklahoma Statutes - Title 64. Public Lands Page 32

funds allocated to investment managers shall be actively managed by

them, which may include selling investments and realizing losses if

the action is considered advantageous to longer term return

maximization. Because of the total return objective, no distinction

shall be made for management and performance evaluation purposes

between realized and unrealized capital gains and losses.

E. The Commissioners shall take any measures they deem

appropriate to safeguard custody of securities and other assets of

the trusts.

F. By September 1 of each year, the Commissioners shall develop

a written investment plan for the trust funds.

G. The Commissioners shall compile a quarterly financial report

showing the performance of all the combined funds under their

control on a fiscal year basis. The report shall contain a list of

all investments made by the Commissioners and a list of any

commissions, fees or payments made for services regarding the

investments for that reporting period. The report shall be based on

market values and shall be compiled pursuant to uniform reporting

standards prescribed by the Oklahoma State Pension Commission for

all state retirement systems. The report shall be distributed to

the Oklahoma State Pension Commission, the Cash Management and

Investment Oversight Commission, and the Legislative Service Bureau.

H. Before January 1 of each year, the Commissioners shall

publish an annual report of all Trust operations, presented in a

simple and easily understood manner to the extent possible. The

report shall be submitted to the Governor, the Speaker of the House

of Representatives, the President Pro Tempore of the Senate, the

State Department of Education and each higher education beneficiary.

The annual report shall cover the operation of the Trusts during the

past fiscal year including income, disbursements and the financial

condition of the Trusts at the end of each fiscal year on a cash

basis. The annual report shall also contain a summary of the assets

of each trust and current market value as of the report date.

I. The Cash Management and Investment Oversight Commission

shall review reports prepared by the Commissioners of the Land

Office pursuant to this subsection and shall make recommendations

regarding the investment strategies and practices, the development

of internal auditing procedures and practices and any other matters

as determined necessary and applicable.

J. The Commissioners of the Land Office shall select one or

more custodial banks to settle transactions involving the investment

of the funds under the control of the Commissioners of the Land

Office. The Commissioners of the Land Office shall review the

performance of each custodial bank at least once every year. The

Commissioners of the Land Office shall require a written competitive

bid every ten (10) years. The custodial bank shall have a minimum

of Five Hundred Million Dollars ($500,000,000.00) in assets to be

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eligible for selection. Any out-of-state custodial bank shall have

a service agent in the State of Oklahoma so that service of summons

or legal notice may be had on the designated agent, and the bank

shall submit to the jurisdiction of Oklahoma state courts for

resolution of any and all disputes. In order to be eligible for

selection, the custodial bank shall allow electronic access to all

transaction and portfolio reports maintained by the custodial bank

involving the investment of state funds under control of the

Commissioners of the Land Office and to the Cash Management and

Investment Oversight Commission. The requirement for electronic

access shall be incorporated into any contract between the
eligible for

selection, the custodial bank shall allow electronic access to all

transaction and portfolio reports maintained by the custodial bank

involving the investment of state funds under control of the

Commissioners of the Land Office and to the Cash Management and

Investment Oversight Commission. The requirement for electronic

access shall be incorporated into any contract between the

Commissioners of the Land Office and the custodial bank. Neither

the Commissioners of the Land Office nor the custodial bank shall

permit any of the funds under the control of the Commissioners of

the Land Office or any of the documents, instruments, securities or

other evidence of a right to be paid money to be located in any

place other than within a jurisdiction or territory under the

control or regulatory power of the United States government.