By: Sibley S.B. No. 1156
A BILL TO BE ENTITLED
AN ACT
1-1 relating to the investment of public funds in mutual funds; and
1-2 declaring an emergency.
1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-4 SECTION 1. Section 2256.011, Government Code, is hereby
1-5 amended by redesignating Subsection (b) as Subsection (c), amending
1-6 Subsection (c), and adding a new Subsection (b), to read as
1-7 follows:
1-8 (b) In addition to a no-load money market mutual fund
1-9 permitted as an authorized investment in Subsection (a) above, a
1-10 no-load mutual fund is an authorized investment under this
1-11 subchapter if the mutual fund:
1-12 (1) is registered with the Securities and Exchange
1-13 Commission;
1-14 (2) has an average weighted maturity of less than two
1-15 years;
1-16 (3) is invested exclusively in obligations described
1-17 by (i) Subsections (1) and (4) of Section 2256.006 and (ii) Section
1-18 2256.008; and
1-19 (4) is continuously rated as to investment quality by
1-20 at least two nationally recognized investment rating firms of not
1-21 less than AA or its equivalent.
1-22 (c) An entity is not authorized by this section to:
1-23 (1) invest in the aggregate more than 80 percent of
2-1 its monthly average fund balance, excluding bond proceeds and
2-2 reserves and other funds held for debt service in money market
2-3 mutual funds described in Subsection (a) or mutual funds described
2-4 in Subsection (b), either separately or collectively; or
2-5 (2) invest its funds or funds under its control,
2-6 excluding bond proceeds and reserves and other funds held for debt
2-7 service, in any one <money market> mutual fund (described in
2-8 Subsection (a) or Subsection 9b) in an amount that exceeds 10
2-9 percent of the total assets of the <money market> mutual fund.
2-10 SECTION 2. This Act shall take effect September 1, 1995.
2-11 SECTION 3. The importance of this legislation and the
2-12 crowded condition of the calendars in both houses create an
2-13 emergency and an imperative public necessity that the
2-14 constitutional rule requiring bills to be read on three several
2-15 days in each house be suspended, and this rule is hereby suspended.