1992-01-13 Regular Meeting - Laserfiche WebLink

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• • Al`t. 8425-2 BONDS-COUNTY, MUNICIPAL, ETC. Tltle. 22 the 67th Legislature, Regular Session, 1981 (Article 2629b-1, Vernon's Texaa Civil Statutes), and that have a market value of not less than the principal amount of the certificates; (6) fully collateralized direct repurchase agreements having a defined termination date, secured by obligations described by Subdivision (1) of this subsection, pledged with a third party selected or approved by the political entity, and placed through a primary govern- ment securities dealer, as defined by the Federal Reserve, or a bank domiciled in this state; and (7) certificates of deposit issued by savings and loan associations domiciled in this state that are: (A) guaranteed or insured by the Federal Savings and Loan Insurance Corporation or its successor; or (B) secured by obligations that are described by Subdivisions (1}(4) of this subsection, which are intended to include all direct federal agency or instrumentality issued mortgage backed securities that have a market value of not less than the principal amount of the certificates. (b) In addition to investment in obligations, certificates, or agreements described in Subsection (a) of this section, bond proceeds of an incorporated city or town, a county, a public school district, or a navigation district, or local revenue of an institution of higher education, may be inveated~ in common trust funds or comparable investment devices owned or administered by banks domiciled in this state and whose assets consist exclusively of all or a combination of the obligations described by Subsection (a) of this section. Common trust funds of banks domiciled in this state may be ,used if they: (1) are available; (2) comply with the provisions of the Internal Revenue Code of 1986 and applicable federal regulations governing the investment of bond proceeds; and (3) meet the cash flow requirements and the investment needs of the political subdivi- sion or institution. (c) In this section: (1) "Bond proceeds" includes but is not limited to proceeds from the sale of bonds and reserves and funds maintained for debt service purposes. - (2) "Prime domestic bankers' acceptances" means a bankers' acceptance with a stated maturity of 270 days or less from the date of its issuance that will be, in accordance with its terms, liquidated in full at maturity, that is eligible for collateral for borrowing from a Federal Reserve Bank, and that is accepted by a bank organized and existing under the laws of the United States or any state, the short-term obligations of which (or of a bank holding company of which the bank is the largest subsidiary) are rated at least A-1, P-1, or the equivalent by at least one nationally recognized credit rating agency. (3) "Repurchase agreement" means a simultaneous agreement to buy, hold for a specified time, and then sell back at a future date, obligations described by.Subsection (a)(1) of this section, the principal and interest of which are guaranteed by the United States or any of its agencies, in market value of not less than the principal amount of the funds disbursed. The term includes direct security repurchase agreements and, reverse security repurchase agreements. (d) In addition to the investments described by Subsection (a) of this section, an entity listed in that subsection may, in accordance with this Act, purchase, sell, and invest its funds and funds under its control in an SEGregistered, no-load money market mutual fund with adollar-weighted average portfolio maturity of 120 days or less whose assets consist exclusively of the obligations that are described by Subsection (a) of this section and whose investment objectives include seeking to maintain a stable net aseet~ value of $1 per share. No entity listed in Subsection (a) of this section is authorized by this Act to invest in the aggregate more than 80 percent of its monthly average fund balance, excluding bond proceeds, in money market mutual funds described in this subsection or to invest its funds or funds under its control, excluding bond proceeda,.in any one money market mutual fund in an amount that exceeds 10 percent of the total assets of the money market mutual fund. 306