ENROLLED

2008 LegislatureCS for SB 2422, 2nd Engrossed

20082422er

An act relating to the investment of local government

surplus funds; amending s. 218.401, F.S.; revising the

purpose of the Investment of Local Government Surplus

Funds Act; amending s. 218.403, F.S.; providing

definitions; amending s. 218.405, F.S.; authorizing the

State Board of Administration to contract with a

professional money management firm to administer the trust

fund; establishing objectives of the trust fund; providing

for trustee certification; amending s. 218.407, F.S.;

requiring the distribution of certain enrollment materials

to potential investors; specifying the contents of the

enrollment materials; requiring the signed acceptance of a

disclosure statement by the authorized local government

official prior to investing in the trust fund; requiring

surplus funds to be invested in pooled investment

accounts; amending s. 218.409, F.S.; revising

administration of the trust fund; providing standards of

care, including level of prudence, ethics and conflicts of

interest, and internal controls; providing for annual

review and approval of investment policy and controls;

providing for reports; revising the use and disclosure of

reserves; requiring investments to be made in pooled

accounts; requiring establishment and approval of an

account balance information system; providing

transparency; requiring monthly reports to certain persons

and groups; providing criteria of the report; requiring

marking to market calculation and reporting; providing

criteria; providing for additional reporting; authorizing

limiting withdrawals from or contributions to the trust

fund under certain circumstances; providing criteria for

use of interest by board; requiring an annual financial

audit; requiring the audit to be reported to certain

persons and groups; requiring certification report by

trustees; creating the Participant Local Government

Advisory Council; providing for appointments, membership,

terms, the filling of vacancies, and officers; requiring

biennial reports by the council to certain persons and

groups; amending ss. 218.411 and 218.412, F.S.; conforming

terminology; creating s. 218.418, F.S.; providing

definitions; creating s. 218.421, F.S.; providing for the

purpose of the Fund B Surplus Funds Trust Fund; providing

rulemaking authority; providing for administration of the

trust fund; providing for annual certification by the

Trustees of the State Board of Administration to the Joint

Legislative Auditing Committee that the trust fund has

been reviewed and is in compliance with the requirements

of this section; providing restrictions on the trust fund;

providing criteria for payment of accrued funds;

restricting participant transactions in the trust fund;

providing for investment policy criteria; providing

procedures for internal controls; providing duty to

disclose material impacts on the trust fund; providing for

investment policy implementation; providing criteria for

payment of costs and use of interest; providing authority

to trustees to distribute remaining reserve upon self-

liquidation; providing reporting requirements; requiring

monthly reports to certain persons and groups; providing

criteria of the report; providing for additional

reporting; requiring trustee review; creating s. 218.422,

F.S.; requiring the Auditor General to review the trust

fund prior to the 2013 Regular Session and provide a

summary report to certain persons and entities; providing

for expiration of ss. 218.418-218.422, F.S., upon

termination or self-liquidation of the trust fund;

providing a contingent effective date.

Be It Enacted by the Legislature of the State of Florida:

Section 1. Section 218.401, Florida Statutes, is amended to

read:

218.401 Purpose.--It is the intent of this part to promote,

through state assistance, the maximization of net interest

earnings on invested surplus funds of local units of government,

based on the principals of investor protection, mandated

transparency, and proper governance, with the goal of thereby

reducing the need for imposing additional taxes.

Section 2. Section 218.403, Florida Statutes, is amended to

read:

218.403 Definitions.--The following words or terms, when

used in this part, shall have the following meanings:

(1) "Board" means the State Board of Administration.

(2)(1) "Chief Financial Officer" means the mayor, manager,

administrator, clerk, comptroller, treasurer, director of

finance, or other local government official, regardless of the

title of his or her office, charged with administering the fiscal

affairs of a unit of local government.

(3)(2) "Current expenses" means expenses to meet known cash

needs and anticipated cash-flow requirements for the short term.

(4) "GASB" means the Governmental Accounting Standards

Board.

(5) "GFOA" means the Government Finance Officers

Association.

(6)(3) "Governing body" means the body or board in which

the legislative power of a unit of local government is vested.

(7)(4) "Short term" means a maximum of 6 months of

operation.

(8)(5) "Surplus funds" means any funds in any general or

special account or fund of a unit of local government, or funds

100

held by an independent trustee on behalf of a unit of local

101

government, which in reasonable contemplation will not be

102

immediately needed for the purposes intended.

103

(9)(6) "Trust fund" means the pooled investment fund

104

created by s. 218.405 and known as the Local Government Surplus

105

Funds Trust Fund.

106

(10) "Trustees" mean the Trustees of the State Board of

107

Administration.

108

(11)(7) "Unit of local government" means any governmental

109

entity within the state not part of state government and shall

110

include, but not be limited to, the following and the officers

111

thereof: any county, municipality, school district, special

112

district, clerk of the circuit court, sheriff, property

113

appraiser, tax collector, supervisor of elections, authority,

114

board, public corporations, or any other political subdivision of

115

the state.

116

Section 3. Section 218.405, Florida Statutes, is amended to

117

read:

118

218.405 Local Government Surplus Funds Trust Fund;

119

creation; objectives; certification; interest; rulemaking.--

120

(1) There is hereby created a Local Government Surplus

121

Funds Trust Fund to be administered by the State board of

122

Administration and to be composed of local government surplus

123

funds deposited therein by units of local government under the

124

procedures established in this part. The board may contract with

125

a professional money management firm to manage the trust fund.

126

(2) The primary objectives, in priority order, of

127

investment activities shall be safety, liquidity, and competitive

128

returns with minimization of risks.

129

(3) The trustees shall annually certify to the Joint

130

Legislative Auditing Committee that the trust fund is in

131

compliance with the requirements of this part and that the

132

trustees have conducted a review of the trust fund and determined

133

that the management of the trust fund is in accord with best

134

investment practices.

135

(4) The board may adopt rules to administer the provisions

136

of this section.

137

Section 4. Section 218.407, Florida Statutes, is amended to

138

read:

139

218.407 Local government investment authority.--

140

(1) Prior to any determination by the governing body that

141

it is in the interest of the unit of local government to deposit

142

surplus funds in the trust fund, the board or a professional

143

money management firm must provide to the governing body

144

enrollment materials, including a trust fund profile containing

145

impartial educational information describing the administration

146

and investment policy of the trust fund, including, but not

147

limited to:

148

(a) All rights and conditions of participation, including

149

potential restrictions on withdrawals.

150

(b) The historical performance, investment holdings, credit

151

quality, and average maturity of the trust fund investments.

152

153

(d) The rate determination processes for any deposit or

154

withdrawal.

155

(e) Any fees, charges, penalties, and deductions that apply

156

to the account.

157

(f) The most recently published financial statements or

158

independent audits, if available, prepared under generally

159

accepted accounting principles.

160

(g) A disclosure statement for signature by the appropriate

161

local government official.

162

(2)(1) Upon review of the enrollment materials and upon

163

determination by the governing body that it is in the interest of

164

the unit of local government to deposit surplus funds in the

165

trust fund, a resolution by the governing body and the signed

166

acceptance of the disclosure statement by the local government

167

official, who may be the chief financial or administrative

168

officer of the local government, shall be filed with the State

169

board and, if appropriate, a copy shall be provided to a

170

professional money management firm of Administration authorizing

171

investment of its surplus funds in the trust fund established by

172

this part. The resolution shall name:

173

(a) The local government official, who may be the chief

174

financial or administrative officer of the local government, or

175

(b) An independent trustee holding funds on behalf of the

176

unit of local government,

177

178

responsible for deposit and withdrawal of such funds.

179

(3)(2) The State board or a professional money management

180

firm of Administration shall, upon the filing of the resolution,

181

invest the moneys in the trust fund in the same manner and

182

subject to the same restrictions as are set forth in s. 215.47.

183

Except when authorized by the board, All units of local

184

government that which qualify to be participants in the Local

185

Government Surplus Funds trust fund shall after January 1, 1982,

186

will normally have surplus funds deposited into a pooled

187

investment account.

188

(4)(3) The provisions of this part shall not impair the

189

power of a unit of local government to hold funds in deposit

190

accounts with banking or savings institutions or to invest funds

191

as otherwise authorized by law.

192

Section 5. Section 218.409, Florida Statutes, is amended to

193

read:

194

218.409 Administration of the trust fund; creation of

195

advisory council.--

196

(1) Upon receipt of the items specified in s. 218.407

197

resolution from the local governing body, the State board or a

198

professional money management firm of Administration shall accept

199

all wire transfers of funds into the trust fund. The State board

200

or a professional money management firm of Administration shall

201

also wire-transfer invested local government funds to the local

202

government upon request of the local government official named in

203

the resolution.

204

(2)(a) The trustees shall ensure that the State board or a

205

professional money management firm administers of Administration

206

shall administer the investment trust fund funds on behalf of the

207

participants. The board or a professional money management firm

208

and shall have the power to invest such funds in accordance with

209

a written investment policy. The investment policy shall be

210

updated annually to conform to best investment practices. The

211

standard of prudence to be used by investment officials shall be

212

the fiduciary standards as set forth in s. 215.47(9), which shall

213

be applied in the context of managing an overall portfolio.

214

Portfolio managers acting in accordance with written procedures

215

and an investment policy and exercising due diligence shall be

216

relieved of personal responsibility for an individual security's

217

credit risk or market price changes, provided deviations from

218

expectations are reported in a timely fashion and the liquidity

219

and the sale of securities are carried out in accordance with the

220

terms of this part.

221

(b) Officers and employees involved in the investment

222

process shall refrain from personal business activity that could

223

conflict with the proper execution and management of the

224

investment program or that could impair their ability to make

225

impartial decisions. Employees and investment officials shall

226

disclose any material interests in financial institutions with

227

which they conduct business on behalf of the trust fund. They

228

shall further disclose any personal financial or investment

229

positions that could be related to the performance of the

230

investment portfolio. Employees and officers shall refrain from

231

undertaking personal investment transactions with the same

232

individual with whom business is conducted on behalf of the

233

board.

234

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all employees have an affirmative duty to immediately disclose

236

any material impact to the trust fund to the participants. To

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ensure such disclosure, a system of internal controls shall be

238

established by the board, which shall be documented in writing as

239

part of the investment policy. The controls shall be designed to

240

prevent the loss of public funds arising from fraud, employee

241

error, and misrepresentation by third parties, unanticipated

242

changes in financial markets, or imprudent actions by employees

243

and officers of the board or a professional money management

244

firm. The controls shall also include formal escalation reporting

245

guidelines for all employees. The guidelines shall establish

246

procedures to address material impacts on the trust fund that

247

require reporting and action.

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(d) The investment policy shall be reviewed and approved

249

annually by the trustees or when market changes dictate, and in

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each event the investment policy shall be reviewed by the

251

Investment Advisory Council and by the Participant Local

252

Government Advisory Council A fee may be charged on any

253

transaction that is not in accord with the close of business as

254

set by the board.

255

(3) The State board or a professional money management firm

256

of Administration may purchase such surety or other bonds as may

257

be necessary for its officials in order to protect the trust

258

fund. A reserve fund may be established to fulfill this purpose.

259

However, any reserve must be a portion of the management fee and

260

must be fully disclosed, including its purpose, in the enrollment

261

materials at the time a unit of local government considers

262

participation. Further, any change in the amount to be charged

263

for a reserve must have a reasonable notice period to allow any

264

participant to withdraw from the trust fund prior to the new

265

reserve charge being imposed.

266

(4) All investments may be purchased jointly for the

267

participants in the trust fund. The board or a professional money

268

management firm shall may also purchase investments for a pooled

269

investment account in which all participants may share pro rata,

270

as determined by rule of the board, in the capital gain, income,

271

or losses, subject to any penalties for early withdrawal. Any

272

provisions for penalties, including their purpose, must be

273

disclosed in the enrollment materials. Any change in the amount

274

to be charged for a penalty must have a reasonable notice period

275

to allow any participant to withdraw from the trust fund prior to

276

the new penalty charge being imposed The board shall determine

277

the rate of return for the pooled investment account. A system

278

shall may be developed by the board, and disclosed in the

279

enrollment materials, subject to annual approval by the trustees,

280

to keep current account balances current balance information and

281

to apportion pooled investment earnings back to individual

282

accounts.

283

(5) The State board of Administration shall keep a separate

284

account, designated by name and number of each participating

285

local government. A maximum number of accounts allowed for each

286

participant may be established by the board. Individual

287

transactions and totals of all investments, or the share

288

belonging to each participant, shall be recorded in the accounts.

289

(6)(a) The State board or a professional money management

290

firm of Administration shall provide a report, at a minimum

291

monthly semiannually or upon the occurrence of a material event,

292

request to every participant having a beneficial interest in the

293

trust fund, the board's executive director, the trustees, the

294

Joint Legislative Auditing Committee, the Investment Advisory

295

Council, and the Participant Local Government Advisory Council.

296

The report shall include:

297

1. Reports of any material impacts on the trust fund and

298

any actions or escalations taken by staff to address such

299

impacts. The trustees shall provide quarterly a report to the

300

Joint Legislative Auditing Committee that the trustees have

301

reviewed and approved the monthly reports and actions taken, if

302

any, to address any impacts.

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2. A management summary that provides an analysis of the

304

status of the current investment portfolio and the individual

305

transactions executed over the last month. This management

306

summary shall be prepared in a manner that will allow anyone to

307

ascertain whether investment activities during the reporting

308

period have conformed to investment policies. Such reporting

309

shall be in conformance with best market practices show the

310

changes in investments made during the preceding period. The

311

report shall delineate, in a manner which is in accordance with

312

generally accepted governmental accounting procedures, those

313

funds on deposit, the manner in which the funds are invested, and

314

the interest earnings thereon. The State board or a professional

315

money management firm of Administration shall furnish upon

316

request the details of an investment transaction to any

317

participant, the trustees, the Investment Advisory Council, and

318

the Participant Local Government Advisory Council.

319

(b) The market value of the portfolio shall be calculated

320

daily. Withdrawals from the trust fund shall be based on a

321

process that is transparent to participants and will ensure that

322

advantages or disadvantages do not occur to parties making

323

deposits or withdrawals on any particular day. A statement of the

324

market value and amortized cost of the portfolio shall be issued

325

to participants in conjunction with any deposits or withdrawals.

326

In addition, this information shall be reported monthly with the

327

items in paragraph (a) to participants, the trustees, the

328

Investment Advisory Council, and the Participant Local Government

329

Advisory Council. The review of the investment portfolio, in

330

terms of value and price volatility, shall be performed with

331

practices consistent with the GFOA Recommended Practice on "Mark-

332

to-Market Practices for State and Local Government Investment

333

Portfolios and Investment Pools." In defining market value,

334

consideration shall be given to GASB Statement 31. Additional

335

reporting may be made to pool participants through regular and

336

frequent ongoing multi-media educational materials and

337

communications, including, but not limited to, historical

338

performance, investment holdings, amortized cost and market value

339

of the trust fund, credit quality, and average maturity of the

340

trust fund investments.

341

(7) Costs incurred in carrying out the provisions of this

342

part shall be deducted from the interest earnings accruing to the

343

trust fund. Such deductions shall be prorated among the

344

participant local governments in the percentage that each

345

participant's deposits bear to the total trust fund. The

346

remaining interest earned shall be distributed monthly to

347

participants according to the amount invested. Except for costs,

348

the board or a professional money management firm may not

349

transfer the interest or use the interest for any other purpose,

350

including, but not limited to, making up investment losses.

351

(8)(a) The principal, and any part thereof, of each and

352

every account constituting the trust fund shall be subject to

353

payment at any time from the moneys in the trust fund. However,

354

the executive director may, in good faith, on the occurrence of

355

an event that has a material impact on liquidity or operations of

356

the trust fund, for 48 hours limit contributions to or

357

withdrawals from the trust fund to ensure that the board can

358

invest moneys entrusted to it in exercising its fiduciary

359

responsibility or as otherwise provided by agreement between the

360

State Board of Administration and the investing unit. Such action

361

shall be immediately disclosed to all participants, the trustees,

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the Joint Legislative Auditing Committee, the Investment Advisory

363

Council, and the Participant Local Government Advisory Council.

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The trustees shall convene an emergency meeting as soon as

365

practicable from the time the executive director has instituted

366

such measures and review the necessity of those measures. If the

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trustees agree with such measures, the trustees shall vote to

368

continue the measures for up to an additional 15 days. The

369

trustees must convene and vote to continue any such measures

370

prior to the expiration of the time limit set, but in no case may

371

the time limit set by the trustees exceed 15 days.

372

(b) An order to withdraw funds or warrant may not be issued

373

upon any account for a larger amount than the share of the

374

particular account to which it applies; and if such order or

375

warrant is issued, the responsible official shall be personally

376

liable under his or her bond for the entire overdraft resulting

377

from the payment if made.

378

(9) The Auditor General shall conduct an annual financial

379

audit of the trust fund, which shall include testing for

380

compliance with the investment policy. The completed audit shall

381

be provided to the participants, the board, the trustees, the

382

Investment Advisory Council, the Participant Local Government

383

Advisory Council, and the Joint Legislative Auditing Committee.

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As soon as practicable, but no later than 30 days after

385

completion of the audit, the trustees shall report to the Joint

386

Legislative Auditing Committee that the trustees have reviewed

387

the audit of the trust fund and shall certify that any necessary

388

items are being addressed by a corrective action plan that

389

includes target completion dates.

390

(10)(a) There is created a six-member Participant Local

391

Government Advisory Council for the purposes of regularly

392

reviewing the administration of the trust fund and making

393

recommendations regarding such administration to the trustees.

394

The members of the council shall be appointed by the board and

395

subject to confirmation by the Senate. Members must possess

396

special knowledge, experience, and familiarity obtained through

397

active, long-standing, and material participation in the dealings

398

of the trust fund. Each member shall serve a 4-year term. Any

399

vacancy shall be filled for the remainder of the unexpired term.

400

The council shall annually elect a chair and vice chair from

401

within its membership. A member may not serve consecutive terms

402

as chair or vice chair.

403

(b) The council shall prepare and submit a written biennial

404

report to the board, trustees, the Investment Advisory Council,

405

and the Joint Legislative Auditing Committee that describes the

406

activities and recommendations of the council.

407

Section 6. Section 218.411, Florida Statutes, is amended to

408

read:

409

218.411 Authorization for state technical and advisory

410

assistance.--

411

(1) The State board of Administration is authorized, upon

412

request, to assist local governments in investing funds that are

413

temporarily in excess of operating needs by:

414

(a) Explaining investment opportunities to such local

415

governments through publication and other appropriate means.

416

(b) Acquainting such local governments with the state's

417

practice and experience in investing short-term funds.

418

419

Community Affairs, technical assistance to local governments in

420

investment of surplus funds.

421

(2) The State board of Administration may establish fees to

422

cover the cost of such services, which shall be paid by the unit

423

of local government requesting such service. Such fees shall be

424

deposited to the credit of the appropriation or appropriations

425

from which the costs of providing the services have been paid or

426

are to be charged.

427

Section 7. Section 218.412, Florida Statutes, is amended to

428

read:

429

218.412 Rulemaking authority.--The State board of

430

Administration may adopt rules as it deems necessary to carry out

431

the provisions of this part for the administration of the Local

432

Government Surplus Funds trust fund.

433

Section 8. Section 218.418, Florida Statutes, is created to

434

read:

435

218.418 Definitions.--As used in ss. 218.421-218.422, the

436

term:

437

(1) "Board" means the State Board of Administration.

438

(2) "Surplus funds" means any funds in any general or

439

special account or fund of a unit of local government, or funds

440

held by an independent trustee on behalf of a unit of local

441

government, which in reasonable contemplation will not be

442

immediately needed for the purposes intended.

443

(3) "Trust fund" means the pooled investment fund known as

444

the Fund B Surplus Funds Trust Fund.

445

(4) "Trustees" means the Trustees of the State Board of

446

Administration.

447

(5) "Unit of local government" means any governmental

448

entity within the state not part of state government and

449

includes, but is not limited to, the following and the officers

450

thereof: any county, municipality, school district, special

451

district, clerk of the circuit court, sheriff, property

452

appraiser, tax collector, supervisor of elections, authority,

453

board, public corporation, or other political subdivision of the

454

state.

455

Section 9. Section 218.421, Florida Statutes, is created to

456

read:

457

218.421 Fund B Surplus Funds Trust Fund; purpose;

458

rulemaking; administration; reporting.--

459

(1)(a) The purpose of the Fund B Surplus Funds Trust Fund

460

is to maximize the payout of principal on invested surplus funds

461

of units of local government formerly in Fund B of the Local

462

Government Surplus Funds Trust Fund through a prudent work out of

463

the trust fund with the ultimate goal of self-liquidating the

464

trust fund through maturity and payout of the investments.

465

(b) The State Board of Administration may adopt rules

466

pursuant to ss. 120.536(1) and 120.54 to administer this section.

467

(2)(a) The board or a professional money management firm

468

shall administer the trust fund on behalf of the participants

469

based on a written investment policy, approved by the trustees,

470

and shall have the power to work out, restructure, or invest such

471

funds. The trustees shall annually certify to the Joint

472

Legislative Auditing Committee that the trustees have conducted a

473

review of the trust fund and that the trust fund is in compliance

474

with the requirements of this section. Any new investments must

475

be made in money market or equivalent funds. The board or a

476

professional money management firm shall keep a separate account,

477

designated by name and number of each participating local

478

government. Individual transactions and totals of all

479

investments, or the share belonging to each participant, shall be

480

recorded in the accounts. Any moneys accrued in the trust fund

481

shall be subject to payment from the trust fund on a monthly

482

basis to the trust fund participants according to their

483

proportional interest in the trust fund so long as at least

484

$100,000 is in the trust fund at the end of that month. After all

485

securities have matured, been sold, or worked out, a final

486

distribution shall be made to the participants in the trust fund.

487

Participants may not conduct transactions in the trust fund.

488

(b) The board or a professional money management firm and

489

all employees of the board or firm have an affirmative duty to

490

immediately disclose any material impact to the trust fund to the

491

participants. To ensure such disclosure, a system of internal

492

controls shall be established by the board, which shall be

493

documented in writing as part of the investment policy. The

494

controls shall be designed to prevent the loss of public funds

495

arising from fraud, employee error, and misrepresentation by

496

third parties, unanticipated changes in financial markets, or

497

imprudent actions by employees and officers of the board or a

498

professional money management firm. The controls shall also

499

include formal escalation reporting guidelines for all employees.

500

The guidelines shall establish procedures to address material

501

impacts on the trust fund that require reporting and action.

502

503

the trustees upon the transfer of the funds into the trust fund

504

or when market changes dictate, and in each event, the investment

505

policy shall be reviewed by the Investment Advisory Council and

506

by the Participant Local Government Advisory Council.

507

(d) Costs incurred in carrying out the provisions of this

508

section, which shall be prorated among the participants in the

509

percentage that each participant's deposits bear to the total

510

trust fund, may be deducted from any interest earned in the trust

511

fund. The board or a professional money management firm may not

512

transfer the interest or use the interest for any other purpose,

513

including, but not limited to, making up investment losses.

514

(e) After the trust fund self-liquidates, any remaining

515

reserve may be transferred by the trustees at their sole

516

discretion back to the trust fund from which the assets were

517

originally separated.

518

(3)(a) The board or a professional money management firm

519

shall provide a report at a minimum, monthly, or upon the

520

occurrence of a material event, to every participant having a

521

beneficial interest in the trust fund, the board's executive

522

director, the trustees, the Joint Legislative Auditing Committee,

523

the Investment Advisory Council, and the Participant Local

524

Government Advisory Council. The report shall include:

525

1. Reports of any material impacts on the trust fund, and

526

any actions or escalations taken by staff to address such

527

impacts. The trustees shall provide quarterly a report to the

528

Joint legislative Auditing Committee that the trustees have

529

reviewed and approved the monthly reports and actions taken, if

530

any, to address any impacts.

531

2. A management summary that provides an analysis of the

532

status of the current investment portfolio and the individual

533

transactions executed over the last month. This management

534

summary shall be prepared in a manner that will allow anyone to

535

ascertain whether investment activities during the reporting

536

period have conformed to investment policies. Such reporting

537

shall be in conformance with best market practices.

538

3. The board or a professional money management firm shall

539

furnish upon request the details of an investment transaction to

540

any participant, the trustees, the Investment Advisory Council,

541

and the Participant Local Government Advisory Council.

542

(b) Additional reporting may be made to participants in the

543

trust fund through regular and frequent ongoing multi-media

544

educational materials and communications, including, but not

545

limited to, historical performance, investment holdings,

546

amortized cost and market value of the trust fund, credit

547

quality, and average maturity of the trust fund investments.

548

(4) The trustees shall review the board's progress in

549

returning the principal in the trust fund to the participants at

550

each meeting of the board until the trust fund self-liquidates or

551

is terminated by law.

552

Section 10. Section 218.422, Florida Statutes, is created

553

to read:

554

218.422 Fund B Surplus Funds Trust Fund; review.--Unless

555

the Fund B Surplus Funds Trust Fund has been terminated by law or

556

through self-liquidation, prior to the 2013 Regular Session of

557

the Legislature, the Auditor General shall review the trust fund

558

and the steps taken up to that time to return as much of the

559

principal to the participants as possible and provide a summary

560

report to the board, the trustees, the President of the Senate,

561

the Speaker of the House of Representatives, the Investment

562

Advisory Council, and the Participant Local Government Advisory

563

Council.

564

Section 11. Sections 218.418, 218.421, and 218.422, Florida

565

Statutes, as created by this act, shall expire at the time the

566

Fund B Surplus Funds Trust Fund is terminated by law or self-

567

liquidates as determined and announced by the executive director

568

of the State Board of Administration, whichever occurs first.

569

Section 12. This act shall take effect upon becoming a law,

570

if House Bill 7097 or similar legislation is adopted in the same

571

legislative session or an extension thereof and becomes law.

CODING: Words stricken are deletions; words underlined are additions.