CHAPTER 7
SB 314 – FINAL VERSION
03/10/10 0914s
04/21/10 1548eba
2010 SESSION
06/05
SENATE BILL 314
AN ACT relative to the investment of public funds and relative to the payment of costs for certain bank services.
SPONSORS: Sen. Houde, Dist 5; Rep. Cooney, Graf 7
COMMITTEE: Commerce, Labor and Consumer Protection
This bill:
I. Permits the state and its political subdivisions to invest in certain certificates of deposit.
II. Permits the state treasurer to pay the cost of bank services from funds not otherwise appropriated.
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Explanation: Matter added to current law appears in bold italics.
Matter removed from current law appears [in brackets and struckthrough.]
Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.
03/10/10 0914s
04/21/10 1548eba
10-2756
06/05
STATE OF NEW HAMPSHIRE
In the Year of Our Lord Two Thousand Ten
AN ACT relative to the investment of public funds and relative to the payment of costs for certain bank services.
Be it Enacted by the Senate and House of Representatives in General Court convened:
7:1 State Treasurer and State Accounts; Investment of Funds. Amend RSA 6:8 to read as follows:
6:8 Investment of Funds.
I. All funds over which the state has exclusive control, aside from such sums of money as the treasurer may deem necessary to hold or deposit for meeting current expenses, shall be invested by the treasurer, with the approval of the governor and council, in obligations of the United States government, in obligations of any county government, municipal government, or district or division thereof within the state of New Hampshire, in obligations which are legal investments for savings banks pursuant to RSA 387, in participation units in the public deposit investment pool established pursuant to RSA 383:22, or in deposits, including money market accounts, or certificates of deposit, or repurchase agreements, and all other types of interest bearing accounts, of federally insured banks chartered under the laws of New Hampshire or the federal government with a branch within the state.
II. The treasurer may also invest public funds in certificates of deposit which meet all of the following conditions:
(a) The funds are initially invested through a federally insured bank chartered under the laws of New Hampshire or the federal government with a branch within the state, selected by the treasurer.
(b) The selected bank arranges for the deposit of the funds in certificates of deposit in one or more federally insured financial institutions located in the United States, for the account of the treasurer.
(c) The full amount of principal and any accrued interest of each such certificate of deposit is covered by federal deposit insurance.
(d) The selected bank acts as custodian with respect to such certificates of deposit issued for the account of the treasurer.
(e) At the same time that the funds are deposited and the certificates of deposit are issued, the selected bank receives an amount of deposits from customers of other federally insured financial institutions equal to or greater than the amount of the funds initially invested through the selected bank by the treasurer.
7:2 New Paragraph; County Treasurers and County Taxes; Duties. Amend RSA 29:1 by inserting after paragraph IV the following new paragraph:
V. As an alternative to the option of collateralization for excess funds provided in paragraph IV, the county treasurer may also invest public funds in certificates of deposit which meet all of the following conditions:
(a) The funds are initially invested through a federally insured bank chartered under the laws of New Hampshire or the federal government with a branch within the state, selected by the treasurer.
(b) The selected bank arranges for the deposit of the funds in certificates of deposit in one or more federally insured financial institutions located in the United States, for the account of the treasurer.
(c) The full amount of principal and any accrued interest of each such certificate of deposit is covered by federal deposit insurance.
(d) The selected bank acts as custodian with respect to such certificates of deposit issued for the account of the treasurer.
(e) At the same time that the funds are deposited and the certificates of deposit are issued, the selected bank receives an amount of deposits from customers of other federally insured financial institutions equal to or greater than the amount of the funds initially invested through the selected bank by the treasurer.
7:3 Duties of Elected and Appointed Town Treasurers. Amend RSA 41:29, V to read as follows:
V.(a) The treasurer shall insure that prior to acceptance of any moneys for deposit or investment, including repurchase agreements, the federally insured bank shall make available at the time of such deposit or investment an option to have such funds secured by collateral having a value at least equal to the amount of such funds. Such collateral shall be segregated for the exclusive benefit of the town. Only securities defined by the bank commissioner as provided by rules adopted pursuant to RSA 386:57 shall be eligible to be pledged as collateral.
(b) As an alternative to the option of collateralization for excess funds provided in subparagraph (a), the town treasurer may also invest public funds in certificates of deposit which meet all of the following conditions:
(1) The funds are initially invested through a federally insured bank chartered under the laws of New Hampshire or the federal government with a branch within the state, selected by the treasurer.
(2) The selected bank arranges for the deposit of the funds in certificates of deposit in one or more federally insured financial institutions located in the United States, for the account of the treasurer.
(3) The full amount of principal and any accrued interest of each such certificate of deposit is covered by federal deposit insurance.
(4) The selected bank acts as custodian with respect to such certificates of deposit issued for the account of the treasurer.
(5) At the same time that the funds are deposited and the certificates of deposit are issued, the selected bank receives an amount of deposits from customers of other federally insured financial institutions equal to or greater than the amount of the funds initially invested through the selected bank by the treasurer.
7:4 New Paragraph; City Treasurer; Duties. Amend RSA 48:16 by inserting after paragraph V the following new paragraph:
VI. As an alternative to the option of collateralization for excess funds provided in paragraph V, the treasurer may also invest public funds in certificates of deposit which meet all of the following conditions:
(a) The funds are initially invested through a federally insured bank chartered under the laws of New Hampshire or the federal government with a branch within the state, selected by the treasurer.
(b) The selected bank arranges for the deposit of the funds in certificates of deposit in one or more federally insured financial institutions located in the United States, for the account of the treasurer.
(c) The full amount of principal and any accrued interest of each such certificate of deposit is covered by federal deposit insurance.
(d) The selected bank acts as custodian with respect to such certificates of deposit issued for the account of the treasurer.
(e) At the same time that the funds are deposited and the certificates of deposit are issued, the selected bank receives an amount of deposits from customers of other federally insured financial institutions equal to or greater than the amount of the funds initially invested through the selected bank by the treasurer.
7:5 New Paragraph; School Meetings and Officers; Treasurer's Duties. Amend RSA 197:23-a by inserting after paragraph IV the following new paragraph:
V. As an alternative to the option of collateralization for excess funds provided in paragraph IV, the treasurer may also invest public funds in certificates of deposit which meet all of the following conditions:
(a) The funds are initially invested through a federally insured bank chartered under the laws of New Hampshire or the federal government with a branch within the state selected by the treasurer.
(b) The selected bank arranges for the deposit of the funds in certificates of deposit in one or more federally insured financial institutions located in the United States, for the account of the treasurer.
(c) The full amount of principal and any accrued interest of each such certificate of deposit is covered by federal deposit insurance.
(d) The selected bank acts as custodian with respect to such certificates of deposit issued for the account of the treasurer.
(e) At the same time that the funds are deposited and the certificates of deposit are issued, the selected bank receives an amount of deposits from customers of other federally insured financial institutions equal to or greater than the amount of the funds initially invested through the selected bank by the treasurer.
7:6 Bank Services. Amend RSA 6:7-a to read as follows:
6:7-a Cost of Bank Services. The state treasurer may pay for the cost of bank services, securities transactions fees, and investment management fees from income generated by the treasury department. If the income generated is insufficient to pay for the cost of bank services, security transaction fees, and investment management fees, payment may be made from funds not otherwise appropriated until such time as the income generated is sufficient to pay for the costs and fees. If the income generated is insufficient to pay for the costs and fees at the end of the fiscal year, the governor may draw a warrant from funds not otherwise appropriated in an amount to cover the deficiency.
7:7 Effective Date. This act shall take effect 60 days after its passage.
Approved: May 4, 2010
Effective Date: July 3, 2010