2002 Legislation
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HOUSE BILL NO. 456 – State treasury, idle moneys/invstmt

HOUSE BILL NO. 456

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View Statement of Purpose / Fiscal Impact



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Daily Data Tracking History



H0456......................................................by STATE AFFAIRS
STATE TREASURER - IDLE MONEYS - INVESTMENT - Amends existing law relating
to the investment of idle moneys in the state treasury to delete language
regarding purchase of the guaranteed portion of a United States Small
Business Loan; and to provide that security held in money market portfolios
must be dollar denominated, meaning that all principal and interest
payments on the security are payable to security holders in United States
dollars.
                                                                        
01/18    House intro - 1st rdg - to printing
01/21    Rpt prt - to St Aff
01/24    Rpt out - rec d/p - to 2nd rdg
01/25    2nd rdg - to 3rd rdg
01/28    3rd rdg - PASSED - 70-0-0
      AYES -- Aikele, Barraclough, Barrett, Bedke, Bell, Bieter, Black,
      Block, Boe, Bolz, Bradford, Bruneel, Callister, Campbell, Clark,
      Collins, Crow, Cuddy, Deal, Denney, Ellis, Ellsworth, Eskridge,
      Field(13), Field(20), Gagner, Gould, Hadley, Hammond, Harwood,
      Henbest, Higgins, Hornbeck, Jaquet, Jones, Kellogg, Kendell, Kunz,
      Lake, Langford, Loertscher, Mader, Martinez, McKague, Meyer,
      Montgomery, Mortensen, Moyle, Pearce, Pischner, Pomeroy, Raybould,
      Ridinger, Roberts, Robison, Sali, Schaefer, Sellman, Shepherd,
      Smith(33), Smith(23), Smylie, Stevenson, Stone, Tilman, Trail,
      Wheeler, Wood, Young, Mr. Speaker
      NAYS -- None
      Absent and excused -- None
    Floor Sponsor - Deal
    Title apvd - to Senate
01/29    Senate intro - 1st rdg - to St Aff
02/04    Rpt out - rec d/p - to 2nd rdg
02/05    2nd rdg - to 3rd rdg
02/07    3rd rdg - PASSED - 31-0-4
      AYES -- Andreason, Boatright, Branch(Bartlett), Brandt, Bunderson,
      Burtenshaw, Cameron, Davis, Deide, Dunklin, Frasure, Geddes, Goedde,
      Hawkins, Hill, Ingram, Ipsen, Little, Lodge, Marley, Noh, Risch,
      Sandy, Schroeder, Sims, Sorensen, Stegner, Stennett, Thorne, Wheeler,
      Williams
      NAYS -- None
      Absent and excused -- Darrington, Keough, King-Barrutia, Richardson
    Floor Sponsor - Sandy
    Title apvd - to House
02/08    To enrol
02/11    Rpt enrol - Sp signed
02/12    Pres signed
02/13    To Governor
02/19    Governor signed
         Session Law Chapter 37
         Effective: 02/19/02

Bill Text


                                                                        
                                                                        
  ||||              LEGISLATURE OF THE STATE OF IDAHO             ||||
 Fifty-sixth Legislature                  Second Regular Session - 2002
                                                                        
                                                                        
                              IN THE HOUSE OF REPRESENTATIVES
                                                                        
                                     HOUSE BILL NO. 456
                                                                        
                                 BY STATE AFFAIRS COMMITTEE
                                                                        
  1                                        AN ACT
  2    RELATING TO THE INVESTMENT OF IDLE MONEYS IN THE STATE TREASURY; AMENDING SEC-
  3        TION 67-1210, IDAHO CODE, TO DELETE LANGUAGE  REGARDING  PURCHASE  OF  THE
  4        GUARANTEED  PORTION  OF A UNITED STATES SMALL BUSINESS LOAN AND TO PROVIDE
  5        THAT SECURITY HELD IN MONEY MARKET PORTFOLIOS MUST  BE  DOLLAR-DENOMINATED
  6        MEANING  THAT ALL PRINCIPAL AND INTEREST PAYMENTS ON THE SECURITY ARE PAY-
  7        ABLE TO SECURITY HOLDERS IN UNITED STATES DOLLARS; AND DECLARING AN  EMER-
  8        GENCY.
                                                                        
  9    Be It Enacted by the Legislature of the State of Idaho:
                                                                        
 10        SECTION  1.  That  Section 67-1210, Idaho Code, be, and the same is hereby
 11    amended to read as follows:
                                                                        
 12        67-1210.  INVESTMENT OF IDLE MONEYS. It shall be the  duty  of  the  state
 13    treasurer  to  invest  idle moneys in the state treasury, other than moneys in
 14    public endowment funds, in any of the following:
 15        (a)  Bonds, treasury bills, interest-bearing notes, or  other  obligations
 16    of  the  United  States, or those for which the faith and credit of the United
 17    States are pledged for the payment of principal and interest.
 18        (b)  General obligation or revenue bonds of this state, or those for which
 19    the faith and credit of this state are pledged for the  payment  of  principal
 20    and interest.
 21        (c)  General obligation or revenue bonds of any county, city, metropolitan
 22    water  district,  municipal  utility district, school district or other taxing
 23    district of this state.
 24        (d)  Notes, bonds, debentures, or other similar obligations issued by  the
 25    farm  credit  system  or  institutions  forming  a part thereof under the farm
 26    credit act of 1971 [U.S.C., tit. 12, sections 2001-2259] and all acts of  con-
 27    gress  amendatory  thereof or supplementary thereto; in bonds or debentures of
 28    the federal home loan bank board established under the federal home loan  bank
 29    act  [U.S.C.,  tit.  12,  sections  1421-1449]; in bonds, debentures and other
 30    obligations of the federal national mortgage association established under the
 31    national housing  act [U.S.C., tit. 12, sections 1701-1750g) as  amended,  and
 32    in  the  bonds of any federal home loan bank established under said act and in
 33    other obligations issued or guaranteed by agencies or instrumentalities of the
 34    government of the state of Idaho or of the United States, including the United
 35    States small business administration guaranteed portion of any  loan  approved
 36    by an Idaho banking corporation and by the state treasurer. provided, that the
 37    purchase  of the guaranteed portion of any United States small business admin-
 38    istration loan is subject to the following conditions:
 39        (i)   The interest rate charged on the loan must be below the prime inter-
 40        est rate and the interest on the loan must be  chargeable  at  a  variable
 41        rate;
 42        (ii)  The interest rate of the loan is reset every three (3) years;
 43        (iii) The maximum maturity period for the loan is ten (10) years.
                                                                        
                                           2
                                                                        
  1        (e)  Bonds,  notes  or other similar obligations issued by public corpora-
  2    tions of the state of Idaho including, but not limited  to,  the  Idaho  state
  3    building  authority,  the Idaho housing authority and the Idaho water resource
  4    board, but such investment shall not extend beyond seven (7) days.
  5        (f)  Repurchase agreements covered by any legal investment for  the  state
  6    of Idaho.
  7        (g)  Tax anticipation notes and registered warrants of the state of Idaho.
  8        (h)  Tax  anticipation  bonds or notes and income and revenue anticipation
  9    bonds  or notes of taxing districts of the state of Idaho.
 10        (i)  Time deposit accounts and  savings  accounts  in  state  depositories
 11    including,  but  not  limited  to, accounts on which interest or dividends are
 12    paid and upon which negotiable orders of withdrawal may be drawn, and  similar
 13    transaction accounts.
 14        (j)  Time  deposit  accounts and savings accounts of state or federal sav-
 15    ings and loan associations located within the geographical boundaries  of  the
 16    state  in  amounts not to exceed the insurance provided by the federal savings
 17    and loan insurance corporation including, but  not  limited  to,  accounts  on
 18    which interest or dividends are paid and upon which negotiable orders of with-
 19    drawal may be drawn, and similar transaction accounts.
 20        (k)  Revenue  bonds  of  institutions  of higher education of the state of
 21    Idaho.
 22        (l)  Share, savings and deposit  accounts  of  state  and  federal  credit
 23    unions  located within the geographical boundaries of the state in amounts not
 24    to exceed the insurance provided by the national credit union share  insurance
 25    fund  and/or any other authorized deposit guaranty corporation, including, but
 26    not limited to, accounts on which interest or  dividends  are  paid  and  upon
 27    which  negotiable  orders  of withdrawal may be drawn, and similar transaction
 28    accounts.
 29        (m)  Money market funds whose portfolios consist of any allowed investment
 30    as specified in this section.  The securities held in money market  portfolios
 31    must  be  dollar-denominated, meaning that all principal and interest payments
 32    on such a security are payable to security holders in United States dollars.
 33        The term "idle moneys" means the balance of cash and  other  evidences  of
 34    indebtedness  which  are  accepted  by banks as cash in the ordinary course of
 35    business, in demand deposit accounts,  after  taking  into  consideration  all
 36    deposits and withdrawals, on a daily basis.
 37        The  interest  received on all such investments, unless otherwise specifi-
 38    cally required by law, shall be paid into the general account of the state  of
 39    Idaho. Provided, unless otherwise specifically provided by statute, any inter-
 40    est  earned  on funds received by the state pursuant to a federal law, regula-
 41    tion, or federal-state agreement which governs disposition of interest  earned
 42    upon  such  funds shall be accounted for separately to give effect to the fed-
 43    eral law, regulation, or federal-state agreement.
 44        If the interest is to be credited to a separate account, the  state  trea-
 45    surer  shall  charge the account an investment administration fee.  The amount
 46    of the fee shall be determined annually by the state treasurer  and  submitted
 47    to the board of examiners for approval as stipulated in section 67-3524, Idaho
 48    Code. The fee shall be expressed as an annual percentage of  the average daily
 49    balance  of  the  account,  including  separate  investments,  if any, of that
 50    account. The fee shall be charged monthly  in  an  amount  approximately  one-
 51    twelfth  (1/12)  of  the  fee  which  would be payable on an annual basis. The
 52    amount of the investment administration fee shall constitute an  appropriation
 53    from  the  account  for  which the investment administration services are ren-
 54    dered.
 55        The state treasurer shall charge an investment administration fee to  each
                                                                        
                                           3
                                                                        
  1    such  state  fund  or  account,  including the general account, which receives
  2    investment income from investments administered by the office of  state  trea-
  3    surer.  The  investment administration fee shall be determined annually by the
  4    state treasurer and submitted to the board of examiners for approval, as stip-
  5    ulated in section 67-3524, Idaho Code.  The  fee  shall  be  expressed  as  an
  6    annual percentage of the average daily balance of the fund or account, includ-
  7    ing  separate  investments,  if any, of that fund or account. The fee shall be
  8    charged monthly in an amount approximately one-twelfth (1/12) of the fee which
  9    would be payable on an annual basis. The amount of the investment  administra-
 10    tion fee shall constitute an appropriation from the fund or account  for which
 11    the investment administration services are rendered.
 12        The term "to invest" means to use the idle moneys in the state treasury to
 13    buy,  sell,  including  selling  before  maturity  at either a gain or a loss,
 14    retain, or exchange any of the investments described in this section,  consid-
 15    ering  the  probable safety of the capital, the probable income to be derived,
 16    and the liquidity of the assets.
                                                                        
 17        SECTION 2.  An emergency existing  therefor,  which  emergency  is  hereby
 18    declared to exist, this act shall be in full force and effect on and after its
 19    passage and approval.

Statement of Purpose / Fiscal Impact


	             STATEMENT OF PURPOSE		
                          RS 11590

The purpose of this legislation is to amend the Idaho Code 67-
1210 in order to clarify language and delete unnecessary language. 
The proposed changes will:

1.	Eliminate the restrictions placed on the small business 
administration loans. Removal of these restrictions will give the 
Investment Division of the State Treasurer’s Office the ability to 
change their investment procedures to accurately reflect the open 
market fluctuations. The current restrictions unnecessarily limit 
the investment of those monies.

2.	Clarify the description of money market portfolios. There 
will be no additional cost to the state. However, the reduction in 
restrictions will allow the Investment Division greater flexibility 
in its investments in this area, thus increasing the opportunity for 
additional investment income for the state.

                           FISCAL IMPACT

None


Contact
Name:	Ron Crane, State Treasurer
Phone:	334-3200
Liza Carberry, Investment Manager





STATEMENT OF PURPOSE/FISCAL NOTE                 H 456