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<br />.BONDS-COUNTY, MUNICIPAL, ETC.
<br />Title 22
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<br />Art~ 842a-2'
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<br />, Bld8
<br />. Sec. 3. (a) Investments under Section 2(bf of this Act may be made only after
<br />competitive bids are solicited from at least three banks as provided by this section. The
<br />bids may be solieited orally. , ' , .
<br />(b) An incorporated city or town or a public school district must attempt to solicit bids
<br />initially from banks located within its boundaries. If there are not three banks available
<br />for the investments within the city's, t9~n's, or public school district's boundaries, the. '
<br />city, town, or public school district may solicit bids from banks located within the county
<br />or counties in which the city, town, or public school district is located in addition to those
<br />banks, if any, that are located within the boundaries of the city, town, or public school
<br />district. If there are not three banks available for the investments within the boundaries
<br />of the city, town, or public school district, or of the county or counties in which it is
<br />located, the city, town, ot: public school district may solicit bids from any bank within the
<br />state in addition to those banks,. if any, that are located within the boundaries of the city,
<br />town, public schQol district, county, or counties. . ,
<br />(c) A county must attempt to solicit bids initially from 'banks located within its
<br />boundaries. If there are not three banks available for the investments within the county,
<br />the county may solicit bids from any bank within the state in addition to those banks, if.
<br />any, that are located within the boundaries of the county.
<br />(d) An institution of higher education as defined by Section 61.003 of the Education
<br />Code or a navigation distriet must solicit bids from at least three banks located within the
<br />state.
<br />(e) A nonprofit corporation acting on behalf of an incorporated city or town, a county, a
<br />public school district, or an institution of higher education as defined by Section 61.003 of
<br />the Education Code" shall follow the procedures identified in Subsection (b), (c), or (d) of
<br />this section, as applicable to the entity on behalf of which the nonprofit corporation .is
<br />acting. , . .",' .
<br />(f) If a bank has notified a governmental entity or nonprofit corporation that it is
<br />unable or unwilling to bid for investments under Section 2(b) of this Act, the governmen-
<br />tal entity or nonprofit corporation that receives the notification may .presume that the
<br />bank is unable or unwilling to bid for the investments until the bank notifies the
<br />governmental entity or nonprofit corporation otherwise in writing.
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<br />Standard of Care
<br />Sec. 4. Investments shall be made with judgment and care, under circumstances then
<br />prevailing, that persons of prudence, discretion, and intelligence exercise in the manage-
<br />ment of their own affairs, not for speculation, but for investment, considering the
<br />probable safety of their capital as well as the probable income to be derived.
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<br />Written Policie8
<br />Sec. 5. (a) Investments shall be .made in accordance with written policies approved by'
<br />the governing body. The investment policies must address liquidity, diversification,
<br />safety of principal, yield, maturity, and quality and capability of investment management,
<br />with primary emphasis on safety and liquidity.
<br />(b) A governing body may provide in its written policies that bids for ce~(icates of
<br />deposit be solicited orally, in writtog, electronically, or in any combination of those
<br />methods.
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<br />Nonapplication to Retirement Fund8
<br />Sec. 6. This Act does not apply to the investment of funds under the control of'a
<br />public retirement system, as defined by Section 12.001(2), Title 110B, Revised Statutes..
<br />. Renumbered 1I5 V.T.C,A. Government Code, t 802.002(2).
<br />Authority 18 Additional ,
<br />See, 7. The authority granted by this Act is in addition to that granted by other law.
<br />Acts 1987, 70th Leg" ch. 889, n 1 to 7, elf. Aug. 31, 1987. Sec, 2 amended by Acts 1989, 71lt Leg.,
<br />ch. 628, i 1, elf. Aug. 28, 1989: Sec. 2(a) amended by Acts 1989, 71lt Leg" ch, 39, i I, eff. April 26,
<br />1989; Acts 1989, 7lst Leg" ch. 693, i 4, elf. Aug. 28, 1989; Acts 1989, 71lt Leg., ch. 750, f I, efr.
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