PRIOR PRINTER'S NOS. 632, 1418, 1656 PRINTER'S NO. 2044
No. 592 Session of 2005
INTRODUCED BY ARMSTRONG, LEMMOND, COSTA AND MADIGAN,
APRIL 4, 2005
SENATOR WENGER, APPROPRIATIONS, RE-REPORTED AS AMENDED,
SEPTEMBER 19, 2006
AN ACT
1 Amending Title 24 (Education) of the Pennsylvania Consolidated
2 Statutes, defining "alternative investment" and "alternative
3 investment vehicle"; and further providing for administrative
4 duties of the board.
5 The General Assembly of the Commonwealth of Pennsylvania
6 hereby enacts as follows:
7 Section 1. Section 8102 of Title 24 of the Pennsylvania
8 Consolidated Statutes is amended by adding definitions to read:
9 § 8102. Definitions.
10 The following words and phrases when used in this part shall
11 have, unless the context clearly indicates otherwise, the
12 meanings given to them in this section:
13 * * *
14 "Alternative investment." An investment in a private equity
15 fund, private debt fund, venture fund, real estate fund, hedge
16 fund or absolute return fund.
17 "Alternative investment vehicle." A limited partnership,
18 limited liability company or any other legal vehicle for
1 authorized investments under section 8521(i) (relating to
2 management of fund and accounts) through which the system makes
3 an alternative investment.
4 * * *
5 Section 2. Section 8502(e) of Title 24 is amended to read:
6 § 8502. Administrative duties of board.
7 * * *
8 (e) Records.--
9 (1) The board shall keep a record of all its proceedings
10 which shall be open to inspection by the public[.], except as
11 otherwise provided in this part or by other law.
12 (2) Any record, material or data received, prepared,
13 used or retained by the board or its employees, investment
14 professionals or agents relating to an investment shall not
15 constitute a public record subject to public inspection under
16 the act of June 21, 1957 (P.L.390, No.212), referred to as
17 the Right-to-Know Law, if, in the reasonable judgment of the
18 board, the disclosure INSPECTION would: <--
19 (i) in the case of an alternative investment or
20 alternative investment vehicle involve the release of
21 sensitive investment or financial information relating to
22 the investment ALTERNATIVE INVESTMENT OR ALTERNATIVE <--
23 INVESTMENT VEHICLE which the fund was able to obtain only
24 upon agreeing to maintain its confidentiality;, subject, <--
25 however, to the condition that such information, to the
26 extent not otherwise exempt, shall constitute a public
27 record subject to public inspection under the Right-to-
28 Know Law, once the board is no longer required by its
29 agreement to maintain confidentiality;
30 (ii) cause substantial competitive harm to the
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1 person from whom sensitive investment or financial
2 information relating to the investment was received; OR <--
3 subject, however, to the condition that such information, <--
4 to the extent not otherwise exempt, shall constitute a
5 public record subject to public inspection under the
6 Right-to-Know Law, once its release no longer causes
7 substantial competitive harm to the person from whom the
8 information was received, which in the case of
9 information regarding an investment, shall be no later
10 than the liquidation of the entity in which the
11 investment was made; or
12 (iii) have a substantial detrimental impact on the
13 value of an investment to be acquired, held or disposed
14 of by the fund, or would cause a breach of the standard
15 of care or fiduciary duty set forth in this part. <--
16 ,subject, however, to the condition that sensitive <--
17 investment or financial information relating to the
18 investment, to the extent not otherwise exempt, shall
19 constitute a public record subject to public inspection
20 under the Right-to-Know Law, once its release no longer
21 has a substantial detrimental impact on the value of an
22 investment of the fund and its release would not cause a
23 breach of the standard of care or fiduciary duty set
24 forth in this part, which, in the case of information
25 regarding an investment, shall be no later than the
26 liquidation of the entity in which the investment was
27 made.
28 (3) (I) THE SENSITIVE INVESTMENT OR FINANCIAL <--
29 INFORMATION EXCLUDED FROM INSPECTION UNDER PARAGRAPH
30 (2)(I), TO THE EXTENT NOT OTHERWISE EXCLUDED FROM
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1 INSPECTION, SHALL CONSTITUTE A PUBLIC RECORD SUBJECT TO
2 PUBLIC INSPECTION UNDER THE RIGHT-TO-KNOW LAW, ONCE THE
3 BOARD IS NO LONGER REQUIRED BY ITS AGREEMENT TO MAINTAIN
4 CONFIDENTIALITY.
5 (II) THE SENSITIVE INVESTMENT OR FINANCIAL
6 INFORMATION EXCLUDED FROM INSPECTION UNDER PARAGRAPH
7 (2)(II), TO THE EXTENT NOT OTHERWISE EXCLUDED FROM
8 INSPECTION, SHALL CONSTITUTE A PUBLIC RECORD SUBJECT TO
9 PUBLIC INSPECTION UNDER THE RIGHT-TO-KNOW LAW ONCE:
10 (A) THE INSPECTION NO LONGER CAUSES SUBSTANTIAL
11 COMPETITIVE HARM TO THE PERSON FROM WHOM THE
12 INFORMATION WAS RECEIVED; OR
13 (B) THE ENTITY IN WHICH THE INVESTMENT WAS MADE
14 IS LIQUIDATED;
15 WHICHEVER IS LATER.
16 (III) THE SENSITIVE INVESTMENT OR FINANCIAL
17 INFORMATION EXCLUDED FROM INSPECTION UNDER PARAGRAPH
18 (2)(III), TO THE EXTENT NOT OTHERWISE EXCLUDED FROM
19 INSPECTION, SHALL CONSTITUTE A PUBLIC RECORD SUBJECT TO
20 PUBLIC INSPECTION UNDER THE RIGHT-TO-KNOW LAW, ONCE:
21 (A) THE INSPECTION NO LONGER HAS A SUBSTANTIAL
22 DETRIMENTAL IMPACT ON THE VALUE OF AN INVESTMENT OF
23 THE FUND AND WOULD NOT CAUSE A BREACH OF THE STANDARD
24 OF CARE OR FIDUCIARY DUTY SET FORTH IN THIS PART; OR
25 (B) THE ENTITY IN WHICH THE INVESTMENT WAS MADE
26 IS LIQUIDATED;
27 WHICHEVER IS LATER.
28 (4) EXCEPT FOR THE PROVISIONS OF PARAGRAPH (3), NOTHING
29 IN THIS SUBSECTION SHALL BE CONSTRUED TO DESIGNATE ANY
30 RECORD, MATERIAL OR DATA RECEIVED, PREPARED, USED OR RETAINED
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1 BY THE BOARD OR ITS EMPLOYEES, INVESTMENT PROFESSIONALS OR
2 AGENTS RELATING TO AN INVESTMENT AS A PUBLIC RECORD SUBJECT
3 TO PUBLIC INSPECTION UNDER THE RIGHT-TO-KNOW LAW.
4 (3) (5) Notwithstanding the provisions of this <--
5 subsection, the following information regarding an
6 alternative investment VEHICLE shall be subject to public <--
7 inspection under the Right-to-Know Law:
8 (i) The name, address and vintage year of the
9 alternative investment vehicle.
10 (ii) The identity of the manager of the alternative
11 investment vehicle.
12 (iii) The dollar amount of the commitment made by
13 the system to the alternative investment vehicle.
14 (iv) The dollar amount of cash contributions made by
15 the system to the alternative investment vehicle since
16 inception.
17 (v) The dollar amount of cash distributions received
18 by the system from the alternative investment vehicle
19 since inception.
20 (vi) The net internal rate of return of the
21 alternative investment vehicle since inception, provided
22 that the system shall not be required to disclose the net
23 internal rate of return under circumstances in which,
24 because of the limited number of portfolio assets
25 remaining in the alternative investment vehicle, the
26 disclosure could reveal the values of specifically
27 identifiable remaining portfolio assets to the detriment
28 of the alternative investment.
29 (vii) The aggregate value of the remaining portfolio
30 assets attributable to the system's investment in the
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1 alternative investment vehicle, provided that the system
2 shall not be required to disclose the value under
3 circumstances in which, because of the limited number of
4 portfolio assets remaining in the alternative investment
5 vehicle, the disclosure could reveal the values of
6 specifically identifiable remaining portfolio assets to
7 the detriment of the alternative investment.
8 (viii) The dollar amount of total management fees
9 and costs paid to the alternative investment vehicle by
10 the system on an annual fiscal year-end basis.
11 * * *
12 Section 3. Nothing in this act shall be construed or deemed <--
13 to imply that:
14 (1) but for the exclusions provided in 24 Pa.C.S. §
15 8502(e)(2), any of the types of records, materials or data
16 described in that paragraph are required to be open to
17 inspection by the public or constitute a public record under
18 the act of June 21, 1957 (P.L.390, No.212), referred to as
19 the Right-to-Know Law; or
20 (2) any record not excluded in 24 Pa.C.S § 8502(e)(2) is
21 a public record under the Right-to-Know Law.
22 Section 4 3. Nothing in this act shall be construed or <--
23 deemed to affect the authority of the Auditor General to obtain
24 copies of any record, material or data described in 24 Pa.C.S. §
25 8502(e)(2) in connection with a lawfully conducted audit.
26 Section 5 4. Nothing in this act shall be construed or <--
27 deemed to imply that the release or making public of any record,
28 material or data described in 24 Pa.C.S. § 8502(e)(2) as not
29 being a public record is a violation of the Public School
30 Employees' Retirement Board's fiduciary duties.
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1 Section 6 5. This act shall apply to any record, material or <--
2 data described in 24 Pa.C.S. § 8502(e)(2), without regard to
3 whether the record, material or data was created, generated or
4 stored before the effective date of this section, without regard
5 to whether the record, material or data was previously released
6 or made public and without regard to whether a request for the
7 record, material or data was made or is pending final response
8 under the act of June 21, 1957 (P.L.390, No.212), referred to as
9 the Right-to-Know Law.
10 Section 7 6. In the event that the Public School Employees' <--
11 Retirement System has collected a fee or other monetary charge
12 for the preparation, duplication, production, redaction or other
13 expenses associated with the inspection or provision of a
14 record, material or data that as a result of the amendment of 24
15 Pa.C.S. § 8502(e) will not be made available for inspection by
16 and will not be provided to the requester who made the payment,
17 the Public School Employees' Retirement System shall return the
18 fee or money to the requester.
19 Section 8 7. This act shall take effect immediately. <--
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