Amendment
Bill No. CS/SB 2422

Amendment No. 495503

CHAMBER ACTION
Senate		House
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1	Representative Domino offered the following:
2
3	Amendment (with title amendment)
4	Remove everything after the enacting clause and insert:
5	Section 1.  Section 218.401, Florida Statutes, is amended
6	to read:
7	218.401  Purpose.--It is the intent of this part to
8	promote, through state assistance, the maximization of net
9	interest earnings on invested surplus funds of local units of
10	government, based on the principals of investor protection,
11	mandated transparency, and proper governance, with the goal of
12	thereby reducing the need for imposing additional taxes.
13	Section 2.  Section 218.403, Florida Statutes, is amended
14	to read:
15	218.403  Definitions.--The following words or terms, when
16	used in this part, shall have the following meanings:
17	(1)  "Board" means the State Board of Administration.
18	(2)(1)  "Chief Financial Officer" means the mayor, manager,
19	administrator, clerk, comptroller, treasurer, director of
20	finance, or other local government official, regardless of the
21	title of his or her office, charged with administering the
22	fiscal affairs of a unit of local government.
23	(3)(2)  "Current expenses" means expenses to meet known
24	cash needs and anticipated cash-flow requirements for the short
25	term.
26	(4)  "GASB" means the Governmental Accounting Standards
27	Board.
28	(5)  "GFOA" means the Government Finance Officers
29	Association.
30	(6)(3)  "Governing body" means the body or board in which
31	the legislative power of a unit of local government is vested.
32	(7)(4)  "Short term" means a maximum of 6 months of
33	operation.
34	(8)(5)  "Surplus funds" means any funds in any general or
35	special account or fund of a unit of local government, or funds
36	held by an independent trustee on behalf of a unit of local
37	government, which in reasonable contemplation will not be
38	immediately needed for the purposes intended.
39	(9)(6)  "Trust fund" means the pooled investment fund
40	created by s. 218.405 and known as the Local Government Surplus
41	Funds Trust Fund.
42	(10)  "Trustees" mean the Trustees of the State Board of
43	Administration.
44	(11)(7)  "Unit of local government" means any governmental
45	entity within the state not part of state government and shall
46	include, but not be limited to, the following and the officers
47	thereof: any county, municipality, school district, special
48	district, clerk of the circuit court, sheriff, property
49	appraiser, tax collector, supervisor of elections, authority,
50	board, public corporations, or any other political subdivision
51	of the state.
52	Section 3.  Section 218.405, Florida Statutes, is amended
53	to read:
54	218.405  Local Government Surplus Funds Trust Fund;
55	creation; objectives; certification; interest; rulemaking.--
56	(1)  There is hereby created a Local Government Surplus
57	Funds Trust Fund to be administered by the State board of
58	Administration and to be composed of local government surplus
59	funds deposited therein by units of local government under the
60	procedures established in this part. The board may contract with
61	a professional money management firm to manage the trust fund.
62	(2)  The primary objectives, in priority order, of
63	investment activities shall be safety, liquidity, and
64	competitive returns with minimization of risks.
65	(3)  The trustees shall annually certify to the Joint
66	Legislative Auditing Committee that the trust fund is in
67	compliance with the requirements of this part and that the
68	trustees have conducted a review of the trust fund and
69	determined that the management of the trust fund is in accord
70	with best investment practices.
71	(4)  The board may adopt rules to administer the provisions
72	of this section.
73	Section 4.  Section 218.407, Florida Statutes, is amended
74	to read:
75	218.407  Local government investment authority.--
76	(1)  Prior to any determination by the governing body that
77	it is in the interest of the unit of local government to deposit
78	surplus funds in the trust fund, the board or a professional
79	money management firm must provide to the governing body
80	enrollment materials, including a trust fund profile containing
81	impartial educational information describing the administration
82	and investment policy of the trust fund, including, but not
83	limited to:
84	(a)  All rights and conditions of participation, including
85	potential restrictions on withdrawals.
86	(b)  The historical performance, investment holdings,
87	credit quality, and average maturity of the trust fund
88	investments.
89	(c)  The applicable administrative rules.
90	(d)  The rate determination processes for any deposit or
91	withdrawal.
92	(e)  Any fees, charges, penalties, and deductions that
93	apply to the account.
94	(f)  The most recently published financial statements or
95	independent audits, if available, prepared under generally
96	accepted accounting principles.
97	(g)  A disclosure statement for signature by the
98	appropriate local government official.
99	(2)(1)  Upon review of the enrollment materials and upon
100	determination by the governing body that it is in the interest
101	of the unit of local government to deposit surplus funds in the
102	trust fund, a resolution by the governing body and the signed
103	acceptance of the disclosure statement by the local government
104	official, who may be the chief financial or administrative
105	officer of the local government, shall be filed with the State
106	board and, if appropriate, a copy shall be provided to a
107	professional money management firm of Administration authorizing
108	investment of its surplus funds in the trust fund established by
109	this part. The resolution shall name:
110	(a)  The local government official, who may be the chief
111	financial or administrative officer of the local government, or
112	(b)  An independent trustee holding funds on behalf of the
113	unit of local government,
114
115	responsible for deposit and withdrawal of such funds.
116	(3)(2)  The State board or a professional money management
117	firm of Administration shall, upon the filing of the resolution,
118	invest the moneys in the trust fund in the same manner and
119	subject to the same restrictions as are set forth in s. 215.47.
120	Except when authorized by the board, All units of local
121	government that which qualify to be participants in the Local
122	Government Surplus Funds trust fund shall after January 1, 1982,
123	will normally have surplus funds deposited into a pooled
124	investment account.
125	(4)(3)  The provisions of this part shall not impair the
126	power of a unit of local government to hold funds in deposit
127	accounts with banking or savings institutions or to invest funds
128	as otherwise authorized by law.
129	Section 5.  Section 218.409, Florida Statutes, is amended
130	to read:
131	218.409  Administration of the trust fund; creation of
132	advisory council.--
133	(1)  Upon receipt of the items specified in s. 218.407
134	resolution from the local governing body, the State board or a
135	professional money management firm of Administration shall
136	accept all wire transfers of funds into the trust fund. The
137	State board or a professional money management firm of
138	Administration shall also wire-transfer invested local
139	government funds to the local government upon request of the
140	local government official named in the resolution.
141	(2)(a)  The trustees shall ensure that the State board or a
142	professional money management firm administers of Administration
143	shall administer the investment trust fund funds on behalf of
144	the participants. The board or a professional money management
145	firm and shall have the power to invest such funds in accordance
146	with a written investment policy. The investment policy shall be
147	updated annually to conform to best investment practices. The
148	standard of prudence to be used by investment officials shall be
149	the fiduciary standards as set forth in s. 215.47(9), which
150	shall be applied in the context of managing an overall
151	portfolio. Portfolio managers acting in accordance with written
152	procedures and an investment policy and exercising due diligence
153	shall be relieved of personal responsibility for an individual
154	security's credit risk or market price changes, provided
155	deviations from expectations are reported in a timely fashion
156	and the liquidity and the sale of securities are carried out in
157	accordance with the terms of this part.
158	(b)  Officers and employees involved in the investment
159	process shall refrain from personal business activity that could
160	conflict with the proper execution and management of the
161	investment program or that could impair their ability to make
162	impartial decisions. Employees and investment officials shall
163	disclose any material interests in financial institutions with
164	which they conduct business on behalf of the trust fund. They
165	shall further disclose any personal financial or investment
166	positions that could be related to the performance of the
167	investment portfolio. Employees and officers shall refrain from
168	undertaking personal investment transactions with the same
169	individual with whom business is conducted on behalf of the
170	board.
171	(c)  The board or a professional money management firm and
172	all employees have an affirmative duty to immediately disclose
173	any material impact to the trust fund to the participants. To
174	ensure such disclosure, a system of internal controls shall be
175	established by the board, which shall be documented in writing
176	as part of the investment policy. The controls shall be designed
177	to prevent the loss of public funds arising from fraud, employee
178	error, and misrepresentation by third parties, unanticipated
179	changes in financial markets, or imprudent actions by employees
180	and officers of the board or a professional money management
181	firm. The controls shall also include formal escalation
182	reporting guidelines for all employees. The guidelines shall
183	establish procedures to address material impacts on the trust
184	fund that require reporting and action.
185	(d)  The investment policy shall be reviewed and approved
186	annually by the trustees or when market changes dictate, and in
187	each event the investment policy shall be reviewed by the
188	Investment Advisory Council and by the Participant Local
189	Government Advisory Council A fee may be charged on any
190	transaction that is not in accord with the close of business as
191	set by the board.
192	(3)  The State board or a professional money management
193	firm of Administration may purchase such surety or other bonds
194	as may be necessary for its officials in order to protect the
195	trust fund. A reserve fund may be established to fulfill this
196	purpose. However, any reserve must be a portion of the
197	management fee and must be fully disclosed, including its
198	purpose, in the enrollment materials at the time a unit of local
199	government considers participation. Further, any change in the
200	amount to be charged for a reserve must have a reasonable notice
201	period to allow any participant to withdraw from the trust fund
202	prior to the new reserve charge being imposed.
203	(4)  All investments may be purchased jointly for the
204	participants in the trust fund. The board or a professional
205	money management firm shall may also purchase investments for a
206	pooled investment account in which all participants may share
207	pro rata, as determined by rule of the board, in the capital
208	gain, income, or losses, subject to any penalties for early
209	withdrawal. Any provisions for penalties, including their
210	purpose, must be disclosed in the enrollment materials. Any
211	change in the amount to be charged for a penalty must have a
212	reasonable notice period to allow any participant to withdraw
213	from the trust fund prior to the new penalty charge being
214	imposed The board shall determine the rate of return for the
215	pooled investment account. A system shall may be developed by
216	the board, and disclosed in the enrollment materials, subject to
217	annual approval by the trustees, to keep current account
218	balances current balance information and to apportion pooled
219	investment earnings back to individual accounts.
220	(5)  The State board of Administration shall keep a
221	separate account, designated by name and number of each
222	participating local government. A maximum number of accounts
223	allowed for each participant may be established by the board.
224	Individual transactions and totals of all investments, or the
225	share belonging to each participant, shall be recorded in the
226	accounts.
227	(6)(a)  The State board or a professional money management
228	firm of Administration shall provide a report, at a minimum
229	monthly semiannually or upon the occurrence of a material event,
230	request to every participant having a beneficial interest in the
231	trust fund, the board's executive director, the trustees, the
232	Joint Legislative Auditing Committee, the Investment Advisory
233	Council, and the Participant Local Government Advisory Council.
234	The report shall include:
235	1.  Reports of any material impacts on the trust fund and
236	any actions or escalations taken by staff to address such
237	impacts. The trustees shall provide quarterly a report to the
238	Joint Legislative Auditing Committee that the trustees have
239	reviewed and approved the monthly reports and actions taken, if
240	any, to address any impacts.
241	2.  A management summary that provides an analysis of the
242	status of the current investment portfolio and the individual
243	transactions executed over the last month. This management
244	summary shall be prepared in a manner that will allow anyone to
245	ascertain whether investment activities during the reporting
246	period have conformed to investment policies. Such reporting
247	shall be in conformance with best market practices show the
248	changes in investments made during the preceding period. The
249	report shall delineate, in a manner which is in accordance with
250	generally accepted governmental accounting procedures, those
251	funds on deposit, the manner in which the funds are invested,
252	and the interest earnings thereon. The State board or a
253	professional money management firm of Administration shall
254	furnish upon request the details of an investment transaction to
255	any participant, the trustees, the Investment Advisory Council,
256	and the Participant Local Government Advisory Council.
257	(b)  The market value of the portfolio shall be calculated
258	daily. Withdrawals from the trust fund shall be based on a
259	process that is transparent to participants and will ensure that
260	advantages or disadvantages do not occur to parties making
261	deposits or withdrawals on any particular day. A statement of
262	the market value and amortized cost of the portfolio shall be
263	issued to participants in conjunction with any deposits or
264	withdrawals. In addition, this information shall be reported
265	monthly with the items in paragraph (a) to participants, the
266	trustees, the Investment Advisory Council, and the Participant
267	Local Government Advisory Council. The review of the investment
268	portfolio, in terms of value and price volatility, shall be
269	performed with practices consistent with the GFOA Recommended
270	Practice on "Mark-to-Market Practices for State and Local
271	Government Investment Portfolios and Investment Pools." In
272	defining market value, consideration shall be given to GASB
273	Statement 31. Additional reporting may be made to pool
274	participants through regular and frequent ongoing multi-media
275	educational materials and communications, including, but not
276	limited to, historical performance, investment holdings,
277	amortized cost and market value of the trust fund, credit
278	quality, and average maturity of the trust fund investments.
279	(7)  Costs incurred in carrying out the provisions of this
280	part shall be deducted from the interest earnings accruing to
281	the trust fund. Such deductions shall be prorated among the
282	participant local governments in the percentage that each
283	participant's deposits bear to the total trust fund. The
284	remaining interest earned shall be distributed monthly to
285	participants according to the amount invested. Except for costs,
286	the board or a professional money management firm may not
287	transfer the interest or use the interest for any other purpose,
288	including, but not limited to, making up investment losses.
289	(8)(a)  The principal, and any part thereof, of each and
290	every account constituting the trust fund shall be subject to
291	payment at any time from the moneys in the trust fund. However,
292	the executive director may, in good faith, on the occurrence of
293	an event that has a material impact on liquidity or operations
294	of the trust fund, for 48 hours limit contributions to or
295	withdrawals from the trust fund to ensure that the board can
296	invest moneys entrusted to it in exercising its fiduciary
297	responsibility or as otherwise provided by agreement between the
298	State Board of Administration and the investing unit. Such
299	action shall be immediately disclosed to all participants, the
300	trustees, the Joint Legislative Auditing Committee, the
301	Investment Advisory Council, and the Participant Local
302	Government Advisory Council. The trustees shall convene an
303	emergency meeting as soon as practicable from the time the
304	executive director has instituted such measures and review the
305	necessity of those measures. If the trustees agree with such
306	measures, the trustees shall vote to continue the measures for
307	up to an additional 15 days. The trustees must convene and vote
308	to continue any such measures prior to the expiration of the
309	time limit set, but in no case may the time limit set by the
310	trustees exceed 15 days.
311	(b)  An order to withdraw funds or warrant may not be
312	issued upon any account for a larger amount than the share of
313	the particular account to which it applies; and if such order or
314	warrant is issued, the responsible official shall be personally
315	liable under his or her bond for the entire overdraft resulting
316	from the payment if made.
317	(9)  The Auditor General shall conduct an annual financial
318	audit of the trust fund, which shall include testing for
319	compliance with the investment policy. The completed audit shall
320	be provided to the participants, the board, the trustees, the
321	Investment Advisory Council, the Participant Local Government
322	Advisory Council, and the Joint Legislative Auditing Committee.
323	As soon as practicable, but no later than 30 days after
324	completion of the audit, the trustees shall report to the Joint
325	Legislative Auditing Committee that the trustees have reviewed
326	the audit of the trust fund and shall certify that any necessary
327	items are being addressed by a corrective action plan that
328	includes target completion dates.
329	(10)(a)  There is created a six-member Participant Local
330	Government Advisory Council for the purposes of regularly
331	reviewing the administration of the trust fund and making
332	recommendations regarding such administration to the trustees.
333	The members of the council shall be appointed by the board and
334	subject to confirmation by the Senate. Members must possess
335	special knowledge, experience, and familiarity obtained through
336	active, long-standing, and material participation in the
337	dealings of the trust fund. Each member shall serve a 4-year
338	term. Any vacancy shall be filled for the remainder of the
339	unexpired term. The council shall annually elect a chair and
340	vice chair from within its membership. A member may not serve
341	consecutive terms as chair or vice chair.
342	(b)  The council shall prepare and submit a written
343	biennial report to the board, trustees, the Investment Advisory
344	Council, and the Joint Legislative Auditing Committee that
345	describes the activities and recommendations of the council.
346	Section 6.  Section 218.411, Florida Statutes, is amended
347	to read:
348	218.411  Authorization for state technical and advisory
349	assistance.--
350	(1)  The State board of Administration is authorized, upon
351	request, to assist local governments in investing funds that are
352	temporarily in excess of operating needs by:
353	(a)  Explaining investment opportunities to such local
354	governments through publication and other appropriate means.
355	(b)  Acquainting such local governments with the state's
356	practice and experience in investing short-term funds.
357	(c)  Providing, in cooperation with the Department of
358	Community Affairs, technical assistance to local governments in
359	investment of surplus funds.
360	(2)  The State board of Administration may establish fees
361	to cover the cost of such services, which shall be paid by the
362	unit of local government requesting such service. Such fees
363	shall be deposited to the credit of the appropriation or
364	appropriations from which the costs of providing the services
365	have been paid or are to be charged.
366	Section 7.  Section 218.412, Florida Statutes, is amended
367	to read:
368	218.412  Rulemaking authority.--The State board of
369	Administration may adopt rules as it deems necessary to carry
370	out the provisions of this part for the administration of the
371	Local Government Surplus Funds trust fund.
372	Section 8.  Section 218.418, Florida Statutes, is created
373	to read:
374	218.418  Definitions.--As used in ss. 218.421-218.422, the
375	term:
376	(1)  "Board" means the State Board of Administration.
377	(2)  "Surplus funds" means any funds in any general or
378	special account or fund of a unit of local government, or funds
379	held by an independent trustee on behalf of a unit of local
380	government, which in reasonable contemplation will not be
381	immediately needed for the purposes intended.
382	(3)  "Trust fund" means the pooled investment fund known as
383	the Fund B Surplus Funds Trust Fund.
384	(4)  "Trustees" means the Trustees of the State Board of
385	Administration.
386	(5)  "Unit of local government" means any governmental
387	entity within the state not part of state government and
388	includes, but is not limited to, the following and the officers
389	thereof: any county, municipality, school district, special
390	district, clerk of the circuit court, sheriff, property
391	appraiser, tax collector, supervisor of elections, authority,
392	board, public corporation, or other political subdivision of the
393	state.
394	Section 9.  Section 218.421, Florida Statutes, is created
395	to read:
396	218.421  Fund B Surplus Funds Trust Fund; purpose;
397	rulemaking; administration; reporting.--
398	(1)(a)  The purpose of the Fund B Surplus Funds Trust Fund
399	is to maximize the payout of principal on invested surplus funds
400	of units of local government formerly in Fund B of the Local
401	Government Surplus Funds Trust Fund through a prudent work out
402	of the trust fund with the ultimate goal of self-liquidating the
403	trust fund through maturity and payout of the investments.
404	(b)  The State Board of Administration may adopt rules
405	pursuant to ss. 120.536(1) and 120.54 to administer this
406	section.
407	(2)(a)  The board or a professional money management firm
408	shall administer the trust fund on behalf of the participants
409	based on a written investment policy, approved by the trustees,
410	and shall have the power to work out, restructure, or invest
411	such funds. The trustees shall annually certify to the Joint
412	Legislative Auditing Committee that the trustees have conducted
413	a review of the trust fund and that the trust fund is in
414	compliance with the requirements of this section. Any new
415	investments must be made in money market or equivalent funds.
416	The board or a professional money management firm shall keep a
417	separate account, designated by name and number of each
418	participating local government. Individual transactions and
419	totals of all investments, or the share belonging to each
420	participant, shall be recorded in the accounts. Any moneys
421	accrued in the trust fund shall be subject to payment from the
422	trust fund on a monthly basis to the trust fund participants
423	according to their proportional interest in the trust fund so
424	long as at least $100,000 is in the trust fund at the end of
425	that month. After all securities have matured, been sold, or
426	worked out, a final distribution shall be made to the
427	participants in the trust fund. Participants may not conduct
428	transactions in the trust fund.
429	(b)  The board or a professional money management firm and
430	all employees of the board or firm have an affirmative duty to
431	immediately disclose any material impact to the trust fund to
432	the participants. To ensure such disclosure, a system of
433	internal controls shall be established by the board, which shall
434	be documented in writing as part of the investment policy. The
435	controls shall be designed to prevent the loss of public funds
436	arising from fraud, employee error, and misrepresentation by
437	third parties, unanticipated changes in financial markets, or
438	imprudent actions by employees and officers of the board or a
439	professional money management firm. The controls shall also
440	include formal escalation reporting guidelines for all
441	employees. The guidelines shall establish procedures to address
442	material impacts on the trust fund that require reporting and
443	action.
444	(c)  The investment policy shall be reviewed and approved
445	by the trustees upon the transfer of the funds into the trust
446	fund or when market changes dictate, and in each event, the
447	investment policy shall be reviewed by the Investment Advisory
448	Council and by the Participant Local Government Advisory
449	Council.
450	(d)  Costs incurred in carrying out the provisions of this
451	section, which shall be prorated among the participants in the
452	percentage that each participant's deposits bear to the total
453	trust fund, may be deducted from any interest earned in the
454	trust fund. The board or a professional money management firm
455	may not transfer the interest or use the interest for any other
456	purpose, including, but not limited to, making up investment
457	losses.
458	(e)  After the trust fund self-liquidates, any remaining
459	reserve may be transferred by the trustees at their sole
460	discretion back to the trust fund from which the assets were
461	originally separated.
462	(3)(a)  The board or a professional money management firm
463	shall provide a report at a minimum, monthly, or upon the
464	occurrence of a material event, to every participant having a
465	beneficial interest in the trust fund, the board's executive
466	director, the trustees, the Joint Legislative Auditing
467	Committee, the Investment Advisory Council, and the Participant
468	Local Government Advisory Council. The report shall include:
469	1.  Reports of any material impacts on the trust fund, and
470	any actions or escalations taken by staff to address such
471	impacts. The trustees shall provide quarterly a report to the
472	Joint legislative Auditing Committee that the trustees have
473	reviewed and approved the monthly reports and actions taken, if
474	any, to address any impacts.
475	2.  A management summary that provides an analysis of the
476	status of the current investment portfolio and the individual
477	transactions executed over the last month. This management
478	summary shall be prepared in a manner that will allow anyone to
479	ascertain whether investment activities during the reporting
480	period have conformed to investment policies. Such reporting
481	shall be in conformance with best market practices.
482	3.  The board or a professional money management firm shall
483	furnish upon request the details of an investment transaction to
484	any participant, the trustees, the Investment Advisory Council,
485	and the Participant Local Government Advisory Council.
486	(b)  Additional reporting may be made to participants in
487	the trust fund through regular and frequent ongoing multi-media
488	educational materials and communications, including, but not
489	limited to, historical performance, investment holdings,
490	amortized cost and market value of the trust fund, credit
491	quality, and average maturity of the trust fund investments.
492	(4)  The trustees shall review the board's progress in
493	returning the principal in the trust fund to the participants at
494	each meeting of the board until the trust fund self-liquidates
495	or is terminated by law.
496	Section 10.  Section 218.422, Florida Statutes, is created
497	to read:
498	218.422  Fund B Surplus Funds Trust Fund; review.--Unless
499	the Fund B Surplus Funds Trust Fund has been terminated by law
500	or through self-liquidation, prior to the 2013 Regular Session
501	of the Legislature, the Auditor General shall review the trust
502	fund and the steps taken up to that time to return as much of
503	the principal to the participants as possible and provide a
504	summary report to the board, the trustees, the President of the
505	Senate, the Speaker of the House of Representatives, the
506	Investment Advisory Council, and the Participant Local
507	Government Advisory Council.
508	Section 11.  Sections 218.418, 218.421, and 218.422,
509	Florida Statutes, as created by this act, shall expire at the
510	time the Fund B Surplus Funds Trust Fund is terminated by law or
511	self-liquidates as determined and announced by the executive
512	director of the State Board of Administration, whichever occurs
513	first.
514	Section 12.  This act shall take effect upon becoming a
515	law, if House Bill 7097 or similar legislation is adopted in the
516	same legislative session or an extension thereof and becomes
517	law.
518
519	-----------------------------------------------------
520	T I T L E  A M E N D M E N T
521	Remove the entire title and insert:
522	A bill to be entitled
523	An act relating to the investment of local government
524	surplus funds; amending s. 218.401, F.S.; revising the
525	purpose of the Investment of Local Government Surplus
526	Funds Act; amending s. 218.403, F.S.; providing
527	definitions; amending s. 218.405, F.S.; authorizing the
528	State Board of Administration to contract with a
529	professional money management firm to administer the trust
530	fund; establishing objectives of the trust fund; providing
531	for trustee certification; amending s. 218.407, F.S.;
532	requiring the distribution of certain enrollment materials
533	to potential investors; specifying the contents of the
534	enrollment materials; requiring the signed acceptance of a
535	disclosure statement by the authorized local government
536	official prior to investing in the trust fund; requiring
537	surplus funds to be invested in pooled investment
538	accounts; amending s. 218.409, F.S.; revising
539	administration of the trust fund; providing standards of
540	care, including level of prudence, ethics and conflicts of
541	interest, and internal controls; providing for annual
542	review and approval of investment policy and controls;
543	providing for reports; revising the use and disclosure of
544	reserves; requiring investments to be made in pooled
545	accounts; requiring establishment and approval of an
546	account balance information system; providing
547	transparency; requiring monthly reports to certain persons
548	and groups; providing criteria of the report; requiring
549	marking to market calculation and reporting; providing
550	criteria; providing for additional reporting; authorizing
551	limiting withdrawals from or contributions to the trust
552	fund under certain circumstances; providing criteria for
553	use of interest by board; requiring an annual financial
554	audit; requiring the audit to be reported to certain
555	persons and groups; requiring certification report by
556	trustees; creating the Participant Local Government
557	Advisory Council; providing for appointments, membership,
558	terms, the filling of vacancies, and officers; requiring
559	biennial reports by the council to certain persons and
560	groups; amending ss. 218.411 and 218.412, F.S.; conforming
561	terminology; creating s. 218.418, F.S.; providing
562	definitions; creating s. 218.421, F.S.; providing for the
563	purpose of the Fund B Surplus Funds Trust Fund; providing
564	rulemaking authority; providing for administration of the
565	trust fund; providing for annual certification by the
566	Trustees of the State Board of Administration to the Joint
567	Legislative Auditing Committee that the trust fund has
568	been reviewed and is in compliance with the requirements
569	of this section; providing restrictions on the trust fund;
570	providing criteria for payment of accrued funds;
571	restricting participant transactions in the trust fund;
572	providing for investment policy criteria; providing
573	procedures for internal controls; providing duty to
574	disclose material impacts on the trust fund; providing for
575	investment policy implementation; providing criteria for
576	payment of costs and use of interest; providing authority
577	to trustees to distribute remaining reserve upon self-
578	liquidation; providing reporting requirements; requiring
579	monthly reports to certain persons and groups; providing
580	criteria of the report; providing for additional
581	reporting; requiring trustee review; creating s. 218.422,
582	F.S.; requiring the Auditor General to review the trust
583	fund prior to the 2013 Regular Session and provide a
584	summary report to certain persons and entities; providing
585	for expiration of ss. 218.418-218.422, F.S., upon
586	termination or self-liquidation of the trust fund;
587	providing a contingent effective date.

CODING: Words stricken are deletions; words underlined are additions.