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The Florida Senate

1999 Florida Statutes

SECTION 261
Municipalities; investments.

166.261  Municipalities; investments.--

(1)  Unless otherwise authorized by law or by ordinance, the governing body of each municipality shall, by resolution to be adopted from time to time, invest and reinvest any surplus public funds in its control or possession in:

(a)  The Local Government Surplus Funds Trust Fund;

(b)  Negotiable direct obligations of, or obligations the principal and interest of which are unconditionally guaranteed by, the United States Government at the then prevailing market price for such securities;

(c)  Interest-bearing time deposits or savings accounts in qualified public depositories as defined in s. 280.02;

(d)  Obligations of the federal farm credit banks; the Federal Home Loan Mortgage Corporation, including Federal Home Loan Mortgage Corporation participation certificates; or the Federal Home Loan Bank or its district banks or obligations guaranteed by the Government National Mortgage Association;

(e)  Obligations of the Federal National Mortgage Association, including Federal National Mortgage Association participation certificates and mortgage pass-through certificates guaranteed by the Federal National Mortgage Association; or

(f)  Securities of, or other interests in, any open-end or closed-end management type investment company or investment trust registered under the Investment Company Act of 1940, 15 U.S.C. ss. 80a-1 et seq., as amended from time to time, provided the portfolio of such investment company or investment trust is limited to obligations of the United States Government or any agency or instrumentality thereof and to repurchase agreements fully collateralized by such United States Government obligations and provided such investment company or investment trust takes delivery of such collateral either directly or through an authorized custodian.

(2)(a)  Every security purchased under this section on behalf of the governing body of a municipality shall be properly earmarked and:

1.  If registered with the issuer or its agents, shall be immediately placed for safekeeping in a location which protects the interest of the governing body in the security;

2.  If in book entry form, shall be held for the credit of the governing body of the municipality by a depository chartered by the Federal Government, the state, or any other state or territory of the United States, that has a branch or principal place of business in this state as defined in s. 658.12, and shall be kept by the depository in an account separate and apart from the assets of the financial institution; or

3.  If physically issued to the holder, but not registered with the issuer or its agents, shall be immediately placed for safekeeping in a safe-deposit box in a financial institution in this state that maintains adequate safe-deposit box insurance.

(b)  The governing body may also receive bank trust receipts in return for investment of surplus funds in securities. Any trust receipts received must enumerate the various securities held, together with the specific number of each security held. The actual securities on which the trust receipts are issued may be held by any bank depository chartered by the United States Government, the State of Florida, or any other state or territory of the United States, that has a branch or principal place of business in this state as defined in s. 658.12, or their designated agents.

(3)  When the money invested in such securities is needed in whole or in part for the purposes originally intended, the governing body of the municipality is authorized to sell such security or securities at the then prevailing market price and to pay the proceeds of such sale into the proper account or fund of the municipality.

(4)  For the purposes of this section, the term "surplus funds" is defined as funds in any general or special account or fund of the municipality, held or controlled by the governing body of the municipality, which funds are not reasonably contemplated to be needed for the purposes intended within a reasonable time from the date of such investment.

(5)  Any surplus public funds subject to a contract or agreement on the date of this enactment shall not be invested contrary to the contract or agreement.

(6)  The provisions of this section are supplemental to any and all other laws relating to the legal investments by municipalities.

(7)  The provisions of this section are subject to the provisions of s. 218.415.

History.--s. 4, ch. 77-394; s. 2, ch. 79-119; s. 4, ch. 79-262; s. 2, ch. 84-57; ss. 2, 4, ch. 88-171; s. 4, ch. 94-332; s. 3, ch. 95-194; s. 7, ch. 98-409.