LEGISLATIVE BUDGET BOARD
Austin, Texas
FISCAL NOTE
74th Regular Session
May 15, 1995
TO: Honorable Kenny Marchant, Chair IN RE: Committee Substitute
Committee on Financial Institutions for
House of Representatives Senate Bill
Austin, Texas No. 1128
By: Ellis
FROM: John Keel, Director
In response to your request for a Fiscal Note on Senate Bill No.
1128 (relating to the deposit, investment, safekeeping, and
records and reports of, and collateral requirements for the
deposit of, funds held by the state treasurer) this office has
determined the following:
The bill would prohibit the investment in certain derivatives and
would limit the amount of state funds which the treasurer may
invest in certain derivatives.
The bill would allow certain state agencies to impose penalties
if eligible payments are not remitted by electronic funds
transfer.
The bill would allow the state treasurer to give contingent
approval to an eligible financial institution desiring to hold
$98,000 or less in state deposits pending final approval by the
state depository board.
The bill would allow the treasurer to invest any state funds, not
just bond proceeds, in state and local obligations and mutual
funds which have the same investment authority as the state
treasury.
The bill would amend the statute to eliminate the current
requirement that the interest rate on tax and revenue
anticipation notes be one percent less than the interest rate
earned by the treasury.
The bill would authorize state and federal credit unions as
state depositories.
The probable fiscal implication of implementing the provisions of
the bill during each of the first five years following passage
is estimated as follows:
Fiscal Probable Revenue
Year Gain to General
Revenue Fund 001
1996 $2,500,000
1997 2,500,000
1998 2,500,000
1999 2,500,000
2000 2,500,000
No fiscal implication to units of local government is
anticipated.
Source: Treasury Department
LBB Staff: JK, MS, RR