| 1 | A bill to be entitled |
| 2 | An act relating to investment of public funds; amending s. |
| 3 | 17.57, F.S.; providing additional authorization for the |
| 4 | Chief Financial Officer to invest state funds; amending s. |
| 5 | 218.415, F.S.; providing additional authorization for |
| 6 | units of local government to invest local government |
| 7 | funds; providing an effective date. |
| 8 |
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| 9 | Be It Enacted by the Legislature of the State of Florida: |
| 10 |
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| 11 | Section 1. Subsection (7) is added to section 17.57, |
| 12 | Florida Statutes, to read: |
| 13 | 17.57 Deposits and investments of state money.-- |
| 14 | (7) In addition to the investments authorized under this |
| 15 | section and notwithstanding any other provisions of law, funds |
| 16 | that are not needed to meet the disbursement needs of the state |
| 17 | may be invested by the Chief Financial Officer in accordance |
| 18 | with the following conditions: |
| 19 | (a) The funds are initially invested through a qualified |
| 20 | public depository, as defined in s. 280.02, selected by the |
| 21 | Chief Financial Officer. |
| 22 | (b) The selected depository arranges for the deposit of |
| 23 | the funds in certificates of deposit in one or more federally |
| 24 | insured banks or savings and loan associations, wherever |
| 25 | located, for the account of the state. |
| 26 | (c) The full amount of principal and accrued interest of |
| 27 | each such certificate of deposit is insured by the Federal |
| 28 | Deposit Insurance Corporation. |
| 29 | (d) The selected depository acts as custodian for the |
| 30 | state with respect to such certificates of deposit issued for |
| 31 | its account. |
| 32 | (e) At the same time the state's funds are deposited and |
| 33 | the certificates of deposit are issued, the selected depository |
| 34 | receives an amount of deposits from customers of other federally |
| 35 | insured financial institutions, wherever located, equal to or |
| 36 | greater than the amount of the funds initially invested by the |
| 37 | Chief Financial Officer through the selected depository. |
| 38 | Section 2. Subsection (23) is added to section 218.415, |
| 39 | Florida Statutes, to read: |
| 40 | 218.415 Local government investment policies.--Investment |
| 41 | activity by a unit of local government must be consistent with a |
| 42 | written investment plan adopted by the governing body, or in the |
| 43 | absence of the existence of a governing body, the respective |
| 44 | principal officer of the unit of local government and maintained |
| 45 | by the unit of local government or, in the alternative, such |
| 46 | activity must be conducted in accordance with subsection (17). |
| 47 | Any such unit of local government shall have an investment |
| 48 | policy for any public funds in excess of the amounts needed to |
| 49 | meet current expenses as provided in subsections (1)-(16), or |
| 50 | shall meet the alternative investment guidelines contained in |
| 51 | subsection (17). Such policies shall be structured to place the |
| 52 | highest priority on the safety of principal and liquidity of |
| 53 | funds. The optimization of investment returns shall be secondary |
| 54 | to the requirements for safety and liquidity. Each unit of local |
| 55 | government shall adopt policies that are commensurate with the |
| 56 | nature and size of the public funds within its custody. |
| 57 | (23) ADDITIONAL AUTHORIZED INVESTMENTS.-?In addition to |
| 58 | the investments authorized for local governments in subsections |
| 59 | (16) and (17) and notwithstanding any other provisions of law, a |
| 60 | unit of local government may invest and reinvest any portion of |
| 61 | surplus public funds in its control or possession in accordance |
| 62 | with the following conditions: |
| 63 | (a) The funds are initially invested through a qualified |
| 64 | public depository, as defined in s. 280.02, selected by the unit |
| 65 | of local government. |
| 66 | (b) The selected depository arranges for the deposit of |
| 67 | the funds in certificates of deposit in one or more federally |
| 68 | insured banks or savings and loan associations, wherever |
| 69 | located, for the account of the unit of local government. |
| 70 | (c) The full amount of principal and accrued interest of |
| 71 | each such certificate of deposit is insured by the Federal |
| 72 | Deposit Insurance Corporation. |
| 73 | (d) The selected depository acts as custodian for the unit |
| 74 | of local government with respect to such certificates of deposit |
| 75 | issued for its account. |
| 76 | (e) At the same time the unit of local government's funds |
| 77 | are deposited and the certificates of deposit are issued, the |
| 78 | selected depository receives an amount of deposits from |
| 79 | customers of other federally insured financial institutions, |
| 80 | wherever located, equal to or greater than the amount of the |
| 81 | funds initially invested by the unit of local government through |
| 82 | the selected depository. |
| 83 | Section 3. This act shall take effect July 1, 2005. |