Florida Senate - 2009 SB 732 By Senator Smith 29-00857-09 2009732__ 1 A bill to be entitled 2 An act relating to surplus public funds; amending ss. 3 17.57 and 218.415, F.S.; requiring that the Chief 4 Financial Officer and local governments deposit 5 surplus funds in financial instruments insured by the 6 Federal Deposit Insurance Corporation rather than in 7 certificates of deposit; providing an effective date. 8 9 Be It Enacted by the Legislature of the State of Florida: 10 11 Section 1. Subsection (7) of section 17.57, Florida 12 Statutes, is amended to read: 13 17.57 Deposits and investments of state money.— 14 (7) In addition to the deposits authorized under this 15 section and notwithstanding any other provisions of law, funds 16 that are not needed to meet the disbursement needs of the state 17 may be deposited by the Chief Financial Officer in accordance 18 with the following conditions: 19 (a) The funds are initially deposited in a qualified public 20 depository, as defined in s. 280.02, selected by the Chief 21 Financial Officer. 22 (b) The selected depository arranges for depositingthe23deposit ofthe funds in financial instruments insured by the 24 Federal Deposit Insurance Corporationcertificates of depositin 25 one or more federally insured banks or savings and loan 26 associations, wherever located, for the account of the state. 27 (c) The full amount of the principal and accrued interest 28 of each financial instrumentsuchcertificate of depositis 29 insured by the Federal Deposit Insurance Corporation. 30 (d) The selected depository acts as custodian for the state 31 with respect to each financial instrumentsuchcertificates of32depositissued for its account. 33 (e) At the same time the state's funds are deposited and 34 the financial instrumentscertificates of depositare issued, 35 the selected depository receives an amount of deposits from 36 customers of other federally insured financial institutions, 37 wherever located, equal to or greater than the amount of the 38 funds initially invested by the Chief Financial Officer through 39 the selected depository. 40 Section 2. Subsection (23) of section 218.415, Florida 41 Statutes, is amended to read: 42 218.415 Local government investment policies.—Investment 43 activity by a unit of local government must be consistent with a 44 written investment plan adopted by the governing body, or in the 45 absence of the existence of a governing body, the respective 46 principal officer of the unit of local government and maintained 47 by the unit of local government or, in the alternative, such 48 activity must be conducted in accordance with subsection (17). 49 Any such unit of local government shall have an investment 50 policy for any public funds in excess of the amounts needed to 51 meet current expenses as provided in subsections (1)-(16), or 52 shall meet the alternative investment guidelines contained in 53 subsection (17). Such policies shall be structured to place the 54 highest priority on the safety of principal and liquidity of 55 funds. The optimization of investment returns shall be secondary 56 to the requirements for safety and liquidity. Each unit of local 57 government shall adopt policies that are commensurate with the 58 nature and size of the public funds within its custody. 59 (23) AUTHORIZED DEPOSITS.—In addition to the investments 60 authorized for local governments in subsections (16) and (17) 61 and notwithstanding any other provisions of law, a unit of local 62 government may deposit any portion of surplus public funds in 63 its control or possession in accordance with the following 64 conditions: 65 (a) The funds are initially deposited in a qualified public 66 depository, as defined in s. 280.02, selected by the unit of 67 local government. 68 (b) The selected depository arranges for depositingthe69deposit ofthe funds in financial instruments insured by the 70 Federal Deposit Insurance Corporationcertificates of depositin 71 one or more federally insured banks or savings and loan 72 associations, wherever located, for the account of the unit of 73 local government. 74 (c) The full amount of the principal and accrued interest 75 of each financial instrumentsuch certificate of depositis 76 insured by the Federal Deposit Insurance Corporation. 77 (d) The selected depository acts as custodian for the unit 78 of local government with respect to each financial instrument 79such certificates of depositissued for its account. 80 (e) At the same time the unit of local government's funds 81 are deposited and the financial instrumentscertificates of82depositare issued, the selected depository receives an amount 83 of deposits from customers of other federally insured financial 84 institutions, wherever located, equal to or greater than the 85 amount of the funds initially invested by the unit of local 86 government through the selected depository. 87 Section 3. This act shall take effect July 1, 2009.