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<br />Art. 8428-2 BOND~OUNTY, MUNICIPAL, ETC.
<br />" TIUe.22
<br />the 67th Legislature, Regular Session, 1981 (Article 2529b-l, Vernon's Texas Civil
<br />Statutes), alid that have a market value of not less than the principal amount of the
<br />certificates; . . . " .
<br />(6) fully collateralized direct repurchase agreements having a defined te~ina'tion date,
<br />secured by obligations described by Subdivision (1) of this subsection, pledged with a third
<br />party selected or approved by the political entity, and placed through a primary govern-
<br />ment securities dealer, as defined by the Federal Reserve, or a bank domiciled in this
<br />state; and " '.
<br />(7) certificates of deposit issued by savings and loan associations domiciled in this state
<br />that are: . .
<br />(A) guaranteed or insured by the Federal Savings and Loan Insurance Corporation or
<br />its successor; or" , " . ,. .
<br />(B) secured by obligations that are described by Subdivisions (1)-(4) of this subsection,
<br />which are intended to include all direct federal agency or instrumentality issued mortgage
<br />backed securities that have a market value of not less than the principal amount of the
<br />certificates. .
<br />(b) In addition to investment in obligations, certificates, or agreements described in
<br />Subsection (a) of this section, bond proceeds of an incorporated city. or town, a couqty, a
<br />public school district, or a navigation district, or local revenue. of an institution of higher
<br />education, may be invested. in common trust funds or comparable investment devices
<br />owned or administered by banks domiciled in this state and whose assets consist
<br />exclusively of all or a combination of the obligations described by Subsection (a) of this
<br />section. Common trust funds of banks domiciled in this. state may be. used. if they:
<br />(1) are available; -, . .
<br />(2) comply with the provmions of the Internal Revenue Code of 1986 and applicable
<br />federal regulations governing the investment of bond proceeds; and
<br />(3) meet the cash flow requirements and the investment needs of the political subdivi-
<br />sion or institution.
<br />(c) In this section: .
<br />(1) "Bond proceeds" includes but is not limited to proceeds from the sale of bonds and
<br />reserves and funds maintained for debt service purposes. ,
<br />(2) "Prime domestic bankers'" acceptances" means a bankers' acceptance with a stated
<br />maturity of 270 days or less from the date of its issuance that will be, in accordance with
<br />its tems, liquidated in full at maturity, that is eligible for collateral for borrowing from a
<br />Federal Reserve Bank, and that is accepted by a bank organized and existing under the
<br />laws of the United States or any state, the short-term obligations of which (or of a bank
<br />holding company of which the bank is the largest subsidiary) are rated at least A-I, P-l,
<br />or the equivalent by at least one nationally recognized credit. rating agency.
<br />(3) "Repurchase agreement" means a simultaneous agreement to buy, hold for a
<br />specified time, and then sell back at a future date, obligations described by.Subsection
<br />(a)(1) of this section, the principal and interest of which are guaranteed by the United
<br />States or any of its agencies, in market value of not less than the principal amount of the
<br />funds disbursed. The term includes direct security ~epurchase agreements and. reverse
<br />. security repurchase agreements.. ' . . ','
<br />(d) In addition to the"'investments described by Subsection (a) of this section, an entity
<br />listed in that subsection may, in accordance with this A~t, purchase, sell, and invest its
<br />funds and funds under its control in an SEC-registered, no-load money market mutual
<br />fund with a dollar-weighted average portfolio maturity of 120 days or less whose assets
<br />consist exclusively of the obligations that are described by Subsection (8) of this section
<br />and whose investment objectives include seeking" to maintain a stable net asset-value of $1
<br />per share. No entity listed in Subsection (a) of this section is authorized by this Act to
<br />invest in the aggregate more than 80 percent of its monthly average fund balance,
<br />excluding bond proceeds, in money market mutual funds described in this subsection or to
<br />invest ibl funds or funds under its control, excluding bond proc~eds,. in anyone money
<br />market mutual fund in an amount that exceeds 10 percent of the total assebl of the
<br />money market mutual fund.
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