By: Bivins S.B. No. 1624
A BILL TO BE ENTITLED
AN ACT
relating to security requirements for the deposit of school
district funds.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subdivision (4), Section 45.201, Education Code,
is amended to read as follows:
(4) "Approved securities" means:
(A) bonds of this state or any agency or
political subdivision of this state;
(B) all evidences of indebtedness legally issued
by the board of trustees of the depositing school district;
(C) all debt securities that are a direct
obligation of the treasury of the United States;
(D) other obligations [all debt securities,
except reducing principal balance securities], the principal and
interest of which are unconditionally guaranteed or insured by, or
backed [in the event of default] by the full faith and credit of,
this state or the United States or their respective agencies and
instrumentalities; and
(E) those securities provided for by Article 842,
Revised Statutes, and Section 1, Chapter 160, General Laws, Acts of
the 43rd Legislature, 1933 (Article 842a, Vernon's Texas Civil
Statutes).
SECTION 2. Section 2257.022, Government Code, is amended to
read as follows:
Sec. 2257.022. AMOUNT OF COLLATERAL. (a) Except as
provided by Subsection (b), the [The] total value of eligible
security to secure a deposit of public funds must be in an amount
not less than the amount of the deposit of public funds:
(1) increased by the amount of any accrued interest;
and
(2) reduced to the extent that the United States or an
instrumentality of the United States insures the deposit.
(b) The total value of eligible security described by
Section 45.201(4)(D), Education Code, to secure a deposit of public
funds of a school district must be in an amount not less than 110
percent of the amount of the deposit. The total market value of the
eligible security must be reported at least once each month to the
school district.
(c) The value of a surety bond is its face value.
(d) [(c)] The value of an investment security is its market
value.
SECTION 3. This Act takes effect September 1, 2003.