Reprinted

March 1, 2005





HOUSE BILL No. 1456

_____


DIGEST OF HB 1456 (Updated February 28, 2005 7:15 pm - DI 73)



Citations Affected: IC 5-13.

Synopsis: Investments by political subdivisions. Allows a county treasurer and the fiscal officer of any political subdivision to invest or reinvest funds in obligations issued, assumed, or guaranteed by the State of Israel. Provides that investments made in obligations issued, assumed, or guaranteed by the State of Israel must have a stated final maturity of not more than five years.

Effective: July 1, 2005.





Murphy, Orentlicher , Hinkle




    January 18, 2005, read first time and referred to Committee on Local Government.
    February 21, 2005, reported _ Do Pass.
    February 28, 2005, read second time, amended, ordered engrossed.





Reprinted

March 1, 2005

First Regular Session 114th General Assembly (2005)


PRINTING CODE. Amendments: Whenever an existing statute (or a section of the Indiana Constitution) is being amended, the text of the existing provision will appear in this style type, additions will appear in this style type, and deletions will appear in this style type.
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HOUSE BILL No. 1456



    A BILL FOR AN ACT to amend the Indiana Code concerning state and local administration.

Be it enacted by the General Assembly of the State of Indiana:

SOURCE: IC 5-13-9-2; (05)HB1456.2.1. -->     SECTION 1. IC 5-13-9-2 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2005]: Sec. 2. (a) Each officer designated in section 1 of this chapter may invest or reinvest any funds that are held by the officer and available for investment in any of the following:
        (1) Securities backed by the full faith and credit of the United States Treasury or fully guaranteed by the United States and issued by any of the following:
            (A) The United States Treasury.
            (B) A federal agency.
            (C) A federal instrumentality.
            (D) A federal government sponsored enterprise.
        (2) Securities fully guaranteed and issued by any of the following:
            (A) A federal agency.
            (B) A federal instrumentality.
            (C) A federal government sponsored enterprise.
         (3) Obligations issued, assumed, or guaranteed as to the payment of principal and interest by the State of Israel.
    (b) If an investment under subsection (a)(1) is made at a cost in excess of the par value of the securities purchased, any premium paid for the securities shall be deducted from the first interest received and returned to the fund from which the investment was purchased, and only the net amount is considered interest income.
    (c) The officer making the investment may sell any securities acquired and may do anything necessary to protect the interests of the funds invested, including the exercise of exchange privileges which may be granted with respect to maturing securities in cases where the new securities offered in exchange meet the requirements for initial investment.
    (d) The investing officers of the political subdivisions are the legal custodians of securities under this chapter. They shall accept safekeeping receipts or other reporting for securities from:
        (1) a duly designated depository as prescribed in this article; or
        (2) a financial institution located either in or out of Indiana having custody of securities with a combined capital and surplus of at least ten million dollars ($10,000,000) according to the last statement of condition filed by the financial institution with its governmental supervisory body.
    (e) The state board of accounts may rely on safekeeping receipts or other reporting from any depository or financial institution.
    (f) In addition to any other investments allowed under this chapter, an officer of a conservancy district located in a city having a population of more than four thousand six hundred fifty (4,650) but less than five thousand (5,000) may also invest in:
        (1) municipal securities; and
        (2) equity securities;
having a stated final maturity of any number of years or having no stated final maturity. The total investments outstanding under this subsection may not exceed twenty-five percent (25%) of the total portfolio of funds invested by the officer of a conservancy district. However, an investment that complies with this subsection when the investment is made remains legal even if a subsequent decrease in the total portfolio invested by the officer of a conservancy district causes the percentage of investments outstanding under this subsection to exceed twenty-five percent (25%).
    (g) In addition to any other investments allowed under this chapter, a clerk-treasurer of a town with a population of more than six thousand three hundred (6,300) but less than ten thousand (10,000) located in a county having a population of more than one hundred thousand (100,000) but less than one hundred five thousand (105,000) may also

invest money in a host community agreement future fund established by ordinance of the town in:
        (1) municipal securities; and
        (2) equity securities;
having a stated final maturity of any number of years or having no stated final maturity. The total investments outstanding under this subsection may not exceed twenty-five percent (25%) of the total portfolio of funds invested by the clerk-treasurer of a town. However, an investment that complies with this subsection when the investment is made remains legal even if a subsequent decrease in the total portfolio invested by the clerk-treasurer of a town causes the percentage of investments outstanding under this subsection to exceed twenty-five percent (25%).

SOURCE: IC 5-13-9-5.6; (05)HB1456.2.2. -->     SECTION 2. IC 5-13-9-5.6 IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2005]: Sec. 5.6. (a) Except for investments allowed under section 2(a)(3), 2(f), or 2(g) of this chapter, investments made under this chapter must have a stated final maturity of not more than:
        (1) five (5) years for a conservancy district located in a city having a population of more than four thousand six hundred fifty (4,650) but less than five thousand (5,000);
        (2) five (5) years for investments made from a host community agreement future fund established by ordinance of a town with a population of more than six thousand three hundred (6,300) but less than ten thousand (10,000) located in a county having a population of more than one hundred thousand (100,000) but less than one hundred five thousand (105,000); or
        (3) except as provided in subsection (b), two (2) years for a fund or political subdivision not described in subdivision (1) or (2);
after the date of purchase or entry into a repurchase agreement.
     (b) An investment made in a security described in section 2(a)(3) of this chapter must have a stated final maturity of not more than five (5) years from the date of purchase.