Bill Text: TX SB767 | 2021-2022 | 87th Legislature | Introduced

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Bill Title: Relating to investments made by the comptroller of public accounts with state funds not deposited in state depositories.

Spectrum: Partisan Bill (Republican 1-0)

Status: (Introduced - Dead) 2021-03-11 - Referred to Finance [SB767 Detail]

Download: Texas-2021-SB767-Introduced.html

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By: Huffman S.B. No. 767

A BILL TO BE ENTITLED
AN ACT
relating to investments made by the comptroller of public accounts
with state funds not deposited in state depositories.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 404.024, Government Code, is amended by
amending Subsections (b) and (c) and adding Subsections (c-1) and
(c-2) to read as follows:
(b) Subject to Chapter 2270, state funds not deposited in
state depositories shall be invested by the comptroller in:
(1) direct security repurchase agreements;
(2) reverse security repurchase agreements;
(3) direct obligations of or obligations the principal
and interest of which are guaranteed by the United States;
(4) direct obligations of or obligations guaranteed by
agencies or instrumentalities of the United States government;
(5) bankers' acceptances that:
(A) are eligible for purchase by the Federal
Reserve System;
(B) do not exceed 270 days to maturity; and
(C) are issued by a bank whose other comparable
short-term obligations are rated in the highest short-term rating
category, within which there may be subcategories or gradations
indicating relative standing, including such subcategories or
gradations as "rating category" or "rated," by a nationally
recognized statistical rating organization, as defined by 15 U.S.C.
Section 78c;
(6) commercial paper that:
(A) does not exceed 365 [270] days to maturity;
and
(B) except as provided by Subsection (i), is
issued by an entity whose other comparable short-term obligations
are rated in the highest short-term rating category by a nationally
recognized statistical rating organization;
(7) contracts written by the treasury in which the
treasury grants the purchaser the right to purchase securities in
the treasury's marketable securities portfolio at a specified price
over a specified period and for which the treasury is paid a fee and
specifically prohibits naked-option or uncovered option trading;
(8) direct obligations of or obligations guaranteed by
the Inter-American Development Bank, the International Bank for
Reconstruction and Development (the World Bank), the African
Development Bank, the Asian Development Bank, and the International
Finance Corporation that have received the highest long-term rating
categories for debt obligations by a nationally recognized
statistical rating organization;
(9) bonds issued, assumed, or guaranteed by the State
of Israel;
(10) obligations of a state or an agency, county,
city, or other political subdivision of a state;
(11) mutual funds secured by obligations that are
described by Subdivisions (1) through (6) or by obligations
consistent with Rule 2a-7 (17 C.F.R. Section 270.2a-7), promulgated
by the Securities and Exchange Commission, including pooled funds:
(A) established by the Texas Treasury
Safekeeping Trust Company;
(B) operated like a mutual fund; and
(C) with portfolios consisting only of
dollar-denominated securities;
(12) foreign currency for the sole purpose of
facilitating investment by state agencies that have the authority
to invest in foreign securities;
(13) asset-backed securities, as defined by the
Securities and Exchange Commission in Rule 2a-7 (17 C.F.R. Section
270.2a-7), that are rated at least A or its equivalent by a
nationally recognized statistical rating organization and that
have a weighted-average maturity of five years or less; and
(14) corporate debt obligations that are rated at
least A or its equivalent by a nationally recognized statistical
rating organization and mature in five years or less from the date
on which the obligations were "acquired," as defined by the
Securities and Exchange Commission in Rule 2a-7 (17 C.F.R. Section
270.2a-7).
(c) Investments in direct security repurchase agreements
and reverse security repurchase agreements may be:
(1) placed through [made with] state or national banks
doing business in this state or with primary dealers as approved by
the Federal Reserve System; or
(2) made directly with a state agency with the
authority to invest in repurchase agreements.
(c-1) For purposes of Subsection (c), "state agency" means:
(1) an office, department, commission, board, or
agency that is part of any branch of state government;
(2) an institution of higher education; or
(3) a nonprofit corporation acting on behalf of an
entity described by Subdivision (1) or (2).
(c-2) Notwithstanding any other law, the term of any reverse
security repurchase agreement made by the comptroller may not
exceed 90 days after the date the reverse security repurchase
agreement is delivered. Money received by the comptroller under
the terms of a reverse security repurchase agreement may be used to
acquire additional authorized investments, but the term of the
authorized investments acquired must mature not later than the
expiration date stated in the reverse security repurchase
agreement.
SECTION 2. This Act takes effect September 1, 2021.