The Florida Senate

280.08  Procedure for payment of losses.--When the Treasurer determines that a default or insolvency has occurred, he or she shall provide notice as required in s. 280.085(1) and implement the following procedures:

(1)  The Treasurer, in cooperation with the Department of Banking and Finance or the receiver of the qualified public depository in default, shall ascertain the amount of funds of each public depositor on deposit at such depository and the amount of deposit insurance applicable to such deposits.

(2)  The potential loss to public depositors shall be calculated by compiling claims received from such depositors. The Treasurer shall validate claims on public deposit accounts which meet the requirements of s. 280.17 and are confirmed as provided in subsection (1).

(3)(a)  The loss to public depositors shall be satisfied, insofar as possible, first through any applicable deposit insurance and then through the sale of securities pledged or deposited by the defaulting depository. The Treasurer may assess qualified public depositories as provided in paragraph (b) for the total loss if the sale of securities cannot be accomplished within 7 business days.

(b)  The Treasurer shall provide coverage of any remaining loss by assessment against the other qualified public depositories. The Treasurer shall determine such assessment for each qualified public depository by multiplying the total amount of any remaining loss to all public depositors by a percentage which represents the average monthly balance of public deposits held by each qualified public depository during the previous 12 months divided by the total average monthly balances of public deposits held by all qualified public depositories, excluding the defaulting depository, during the same period. The assessment calculation shall be computed to six decimal places.

(4)  Each qualified public depository shall pay its assessment to the Treasurer within 7 business days after it receives notice of the assessment. If a depository fails to pay its assessment when due, the Treasurer shall satisfy the assessment by selling securities pledged by that depository.

(5)  The Treasurer shall distribute the funds to the public depositors of the qualified public depository in default according to their validated claims. The Treasurer, at his or her discretion, may make partial payments to public depositors that have experienced a loss of public funds which payments are critical to the immediate operations of the public entity. The public depositor requesting partial payment of a claim shall provide the Treasurer with written documentation justifying the need for partial payment.

(6)  Public depositors receiving payment under the provisions of this section shall assign to the Treasurer any interest they may have in funds that may subsequently be made available to the qualified public depository in default. If the qualified public depository in default or its receiver provides the funds to the Treasurer, the Treasurer shall distribute the funds, plus all accrued interest which has accumulated from the investment of the funds, if any, to the depositories which paid assessments on the same pro rata basis as the assessments were paid.

(7)  Expenses incurred by the Treasurer in connection with a default or insolvency which are not normally incurred by the Treasurer in the administration of this act must be paid out of the proceeds from the sale of pledged collateral.

History.--s. 3, ch. 81-285; s. 5, ch. 85-259; s. 13, ch. 87-409; s. 8, ch. 88-185; s. 191, ch. 95-148; s. 10, ch. 96-216; s. 16, ch. 98-409; s. 18, ch. 99-155.