78R1980 ATP-D
By: Shapleigh S.B. No. 626
A BILL TO BE ENTITLED
AN ACT
relating to requirements for considering a financial institution
for selection as a depository of public funds.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subtitle Z, Title 3, Finance Code, is amended by
adding Chapter 278 to read as follows:
CHAPTER 278. DEPOSIT OF PUBLIC FUNDS
Sec. 278.001. DEFINITIONS. In this chapter:
(1) "Branch" means a location of a financial
institution, other than the financial institution's home office, at
which the financial institution does business.
(2) "County in which the financial institution does
business" means any county in which:
(A) the financial institution has a branch or a
home office; or
(B) a public agency that deposits funds in the
financial institution is wholly or partly located.
(3) "Depository of public funds" means a financial
institution in which funds are deposited by a public agency,
including funds deposited under Chapter 105 or 116, Local
Government Code, and funds deposited by the comptroller under
Chapter 404, Government Code.
(4) "Home office" means a location at which:
(A) the financial institution does business;
(B) the financial institution keeps its
corporate books and records; and
(C) at least one executive officer of the
financial institution maintains an office.
(5) "Financial institution" has the meaning assigned
by Section 201.101.
(6) "Public agency" means a state agency, political
subdivision, or publicly owned utility.
(7) "State agency" means any institution, agency, or
organ of state government established by the constitution or laws
of this state, including any department, bureau, board, commission,
office, or council of this state.
Sec. 278.002. RESTRICTION ON SELECTION OF DEPOSITORY OF
PUBLIC FUNDS. A public agency, when selecting a depository of
public funds, may consider a financial institution only if the
financial institution submits to the public agency the information
required by Section 278.003.
Sec. 278.003. REQUIRED INFORMATION. A financial
institution shall submit to the public agency considering the
financial institution for selection as a depository of its public
funds:
(1) an itemized report covering the preceding calendar
year and stating, separately for each county in which the financial
institution does business, the financial institution's:
(A) deposits;
(B) loans for home purchases or home
improvements;
(C) commercial loans, as defined by Section
306.001;
(D) loans for small businesses, as defined by
Section 2006.001, Government Code; and
(E) loans for the purchase or lease of goods or
services for personal, family, or household use;
(2) if the financial institution displays or
publishes, or causes to be displayed or published, an advertisement
regarding the financial institution's prime lending rate for small
businesses, any information regarding the advertisement that the
public agency requires;
(3) evidence that the financial institution has not
been assigned a rating below "satisfactory record of meeting
community credit needs" under 12 U.S.C. Section 2906; and
(4) an itemized report covering the preceding calendar
year and describing, separately for each county in which the
financial institution does business:
(A) the community reinvestment initiatives and
special loan programs offered by the financial institution,
including:
(i) the funding level for each program; and
(ii) the amount of funds actually disbursed
in the program;
(B) the total number and amount of loans provided
for small businesses, as defined by Section 2006.001, Government
Code;
(C) the total number and amount of loans for
small businesses, as defined by Section 2006.001, Government Code,
excluding extensions of credit made pursuant to a credit card
transaction;
(D) the total number and amount of loans
guaranteed in whole or in part by the Small Business
Administration;
(E) the business planning and loan application
assistance programs offered to customers;
(F) the financial institution's total number of
employees, the number of employees who transferred to another
county or state, and the number of employees who left employment
with the financial institution; and
(G) the amount of charitable contributions.
SECTION 2. A public agency that enters into a depository
contract on or after the effective date of this Act shall comply
with Chapter 278, Finance Code, as added by this Act.
SECTION 3. This Act takes effect September 1, 2003.