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AB-849 Public agency investments.(2003-2004)

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AB849:v98#DOCUMENT

Amended  IN  Assembly  January 05, 2004

CALIFORNIA LEGISLATURE— 2003–2004 REGULAR SESSION

Assembly Bill No. 849


Introduced  by  Assembly Member Lieber

February 20, 2003


An act to add Chapter 15 (commencing with Section 5980) to Division 6 of Title 1 of the Government Code, relating to public agency investments.


LEGISLATIVE COUNSEL'S DIGEST


AB 849, as amended, Lieber. Public agency investments.
Existing law generally provides that whenever a state agency is authorized to invest funds, or to sell or exchange securities, approval of the Department of Finance is required prior to the investment, sale, or exchange.
This bill would state the intent of the Legislature to require a state or local agency that invests public funds and with, or purchases financial instruments from, financial institutions, to go through utilize a financial institution that has positive a specified rating under the federal Community Reinvestment Act.
Vote: MAJORITY   Appropriation: NO   Fiscal Committee: NO   Local Program: NO  

The people of the State of California do enact as follows:


SECTION 1.

It is the intent of the Legislature to require a state or local agency that invests public funds and purchases financial instruments from financial institutions to go through a financial institution that has positive rating under the federal Community Reinvestment Act set forth in Chapter 30 of Title 12 of the United States Code.

SECTION 1.

 Chapter 15 (commencing with Section 5980) is added to Division 6 of Title 1 of the Government Code, to read:
CHAPTER  15. Financial Institution Ratings

5980.
 Any state or local agency that invests public funds with, or purchases financial instruments from, financial institutions that are subject to the federal Community Reinvestment Act (16 U.S.C. Sec. 2901) shall utilize an institution that has a current rating of outstanding, as defined by Section 25.28 of Title 12 of the Code of Federal Regulations.

5981.
 Notwithstanding Section 5980, a state or local agency may utilize an institution that has a current rating of satisfactory to obtain financial instruments that are not otherwise available from an institution with a rating of outstanding.