By: Jackson (Senate Sponsor - Carona) H.B. No. 2103

(In the Senate - Received from the House May 12, 2011; May 12, 2011, read first time and referred to Committee on Business and Commerce; May 18, 2011, reported favorably by the following vote: Yeas 8, Nays 0; May 18, 2011, sent to printer.)

A BILL TO BE ENTITLED

AN ACT

relating to the consideration of a letter of credit issued by a federal home loan bank as an eligible security for collateral to secure public funds.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

SECTION 1. Section 2257.002(4), Government Code, is amended to read as follows:

(4) "Eligible security" means:

(A) a surety bond;

(B) an investment security;

(C) an ownership or beneficial interest in an investment security, other than an option contract to purchase or sell an investment security;

(D) a fixed-rate collateralized mortgage obligation that has an expected weighted average life of 10 years or less and does not constitute a high-risk mortgage security; [or]

(E) a floating-rate collateralized mortgage obligation that does not constitute a high-risk mortgage security; or

(F) a letter of credit issued by a federal home loan bank.

SECTION 2. This Act takes effect immediately if it receives a vote of two-thirds of all the members elected to each house, as provided by Section 39, Article III, Texas Constitution. If this Act does not receive the vote necessary for immediate effect, this Act takes effect September 1, 2011.

* * * * *