1-1 By: Sibley, Ellis S.B. No. 450
1-2 (In the Senate - Filed February 23, 1993; February 24, 1993,
1-3 read first time and referred to Committee on State Affairs;
1-4 April 21, 1993, reported favorably by the following vote: Yeas 11,
1-5 Nays 0; April 21, 1993, sent to printer.)
1-6 COMMITTEE VOTE
1-7 Yea Nay PNV Absent
1-8 Harris of Dallas x
1-9 Rosson x
1-10 Carriker x
1-11 Henderson x
1-12 Leedom x
1-13 Lucio x
1-14 Luna x
1-15 Nelson x
1-16 Patterson x
1-17 Shelley x
1-18 Sibley x
1-19 West x
1-20 Whitmire x
1-21 A BILL TO BE ENTITLED
1-22 AN ACT
1-23 relating to authorized investment of the state and certain units of
1-24 local government.
1-25 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-26 SECTION 1. Section 2, Public Funds Investment Act of 1987
1-27 (Article 842a-2, Vernon's Texas Civil Statutes), is amended by
1-28 adding Subsection (e) to read as follows:
1-29 (e) In addition to investments authorized by other law, the
1-30 state, a department, commission, board, office, or any other entity
1-31 of state government or an entity listed in Subsection (a) of this
1-32 section may invest in bonds issued, assumed, or guaranteed by the
1-33 State of Israel.
1-34 SECTION 2. Subsection (a), Section 404.024, Government Code,
1-35 is amended to read as follows:
1-36 (a) The board may determine and designate the amount of
1-37 state funds to be deposited in state depositories, the amount of
1-38 those deposits that shall be demand deposits and the amount that
1-39 shall be time deposits, and the amount of state funds that shall be
1-40 invested by the treasurer in:
1-41 (1) direct security repurchase agreements;
1-42 (2) reverse security repurchase agreements;
1-43 (3) direct obligations of or obligations the principal
1-44 and interest of which are guaranteed by the United States;
1-45 (4) direct obligations of or obligations guaranteed by
1-46 agencies or instrumentalities of the United States government;
1-47 (5) bankers' acceptances that:
1-48 (A) are eligible for purchase by the Federal
1-49 Reserve System;
1-50 (B) do not exceed 270 days to maturity; and
1-51 (C) are issued by a bank that has received the
1-52 highest short-term credit rating by a nationally recognized
1-53 investment rating firm;
1-54 (6) commercial paper that:
1-55 (A) does not exceed 270 days to maturity; and
1-56 (B) has received the highest short-term credit
1-57 rating by a nationally recognized investment rating firm;
1-58 (7) contracts written by the treasury in which the
1-59 treasury grants the purchaser the right to purchase securities in
1-60 the treasury's marketable securities portfolio at a specified price
1-61 over a specified period and for which the treasury is paid a fee
1-62 and specifically prohibits naked-option or uncovered option
1-63 trading; <and>
1-64 (8) direct obligations of or obligations guaranteed by
1-65 the Inter-American Development Bank, the International Bank for
1-66 Reconstruction and Development (the World Bank), the African
1-67 Development Bank, the Asian Development Bank, and the International
1-68 Finance Corporation that have received the highest credit rating by
2-1 a nationally recognized investment rating firm; and
2-2 (9) bonds issued, assumed, or guaranteed by the State
2-3 of Israel.
2-4 SECTION 3. Section 845.301, Government Code, is amended to
2-5 read as follows:
2-6 Sec. 845.301. Investment of Assets. The board of trustees
2-7 shall invest and reinvest the assets of the retirement system
2-8 without distinction as to their source in:
2-9 (1) interest-bearing bonds or other evidences of
2-10 indebtedness of this state, a county, school district, city, or
2-11 other municipal corporation of this state, the United States, or an
2-12 authority or an agency of the United States;
2-13 (2) securities for which the United States or any
2-14 authority or agency of the United States guarantees the payment of
2-15 principal and interest;
2-16 (3) interest-bearing bonds, notes, or other evidences
2-17 of indebtedness that are issued by a company:
2-18 (A) incorporated in the United States and that
2-19 are rated "A" or better by one or more nationally recognized rating
2-20 agencies approved by the board; or
2-21 (B) in whose stock the retirement system may
2-22 invest as provided by Subdivision (4);
2-23 (4) common or preferred stocks of a company
2-24 incorporated in the United States that has paid cash dividends on
2-25 its common stock for 10 consecutive years immediately before the
2-26 date of purchase and, unless the stocks are bank or insurance
2-27 stocks, that is listed on an exchange registered with the
2-28 Securities and Exchange Commission or its successor; <or>
2-29 (5) obligations issued, assumed, or guaranteed by the
2-30 Inter-American Development Bank, the International Bank for
2-31 Reconstruction and Development (the World Bank), the African
2-32 Development Bank, the Asian Development Bank, and the International
2-33 Finance Corporation; or
2-34 (6) bonds issued, assumed, or guaranteed by the State
2-35 of Israel.
2-36 SECTION 4. Section 855.301, Government Code, is amended to
2-37 read as follows:
2-38 Sec. 855.301. Investment of Assets. The board of trustees
2-39 shall invest and reinvest the assets of the retirement system
2-40 without distinction as to their source in:
2-41 (1) interest-bearing bonds or other evidences of
2-42 indebtedness of this state, a county, school district, city, or
2-43 other municipal corporation of this state, the United States, or an
2-44 authority or agency of the United States;
2-45 (2) securities on which the United States or any
2-46 authority or agency of the United States guarantees the payment of
2-47 principal and interest;
2-48 (3) corporate bonds or debentures that are issued by a
2-49 company:
2-50 (A) incorporated in the United States and that
2-51 are rated "A" or better by one or more nationally recognized rating
2-52 agencies approved by the board; or
2-53 (B) in whose stock the retirement system may
2-54 invest as provided by Subdivision (4);
2-55 (4) common or preferred stocks of a company
2-56 incorporated in the United States that has paid cash dividends on
2-57 its stock for 10 consecutive years immediately before the date of
2-58 purchase and, unless the stocks are bank or insurance stocks, that
2-59 is listed on an exchange registered with the Securities and
2-60 Exchange Commission or its successor; <or>
2-61 (5) obligations issued, assumed, or guaranteed by the
2-62 Inter-American Development Bank, the International Bank for
2-63 Reconstruction and Development (the World Bank), the African
2-64 Development Bank, the Asian Development Bank, and the International
2-65 Finance Corporation; or
2-66 (6) bonds issued, assumed, or guaranteed by the State
2-67 of Israel.
2-68 SECTION 5. The importance of this legislation and the
2-69 crowded condition of the calendars in both houses create an
2-70 emergency and an imperative public necessity that the
3-1 constitutional rule requiring bills to be read on three several
3-2 days in each house be suspended, and this rule is hereby suspended,
3-3 and that this Act take effect and be in force from and after its
3-4 passage, and it is so enacted.
3-5 * * * * *
3-6 Austin,
3-7 Texas
3-8 April 21, 1993
3-9 Hon. Bob Bullock
3-10 President of the Senate
3-11 Sir:
3-12 We, your Committee on State Affairs to which was referred S.B.
3-13 No. 450, have had the same under consideration, and I am instructed
3-14 to report it back to the Senate with the recommendation that it do
3-15 pass and be printed.
3-16 Harris of
3-17 Dallas, Chairman
3-18 * * * * *
3-19 WITNESSES
3-20 FOR AGAINST ON
3-21 ___________________________________________________________________
3-22 Name: Robert Abrahms x
3-23 Representing: Dev Corp For Israel
3-24 City: Houston
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