Bill Text: MS HB416 | 2024 | Regular Session | Introduced
Bill Title: Proxy Voting Integrity and Transparency Act; create.
Spectrum: Partisan Bill (Republican 1-0)
Status: (Failed) 2024-03-05 - Died In Committee [HB416 Detail]
Download: Mississippi-2024-HB416-Introduced.html
MISSISSIPPI LEGISLATURE
2024 Regular Session
To: Business and Commerce
By: Representative Yancey
House Bill 416
AN ACT TO CREATE THE PROXY VOTING INTEGRITY AND TRANSPARENCY ACT; TO DEFINE THE TERMS "PECUNIARY FACTOR", "PLAN" AND "GOVERNMENTAL ENTITY"; TO PROVIDE THAT A GOVERNMENTAL ENTITY THAT ESTABLISHES OR MAINTAINS A PLAN MUST MAKE ALL DIRECT INVESTMENT DECISIONS BASED SOLELY ON PECUNIARY FACTORS WHEN EVALUATING A PROXY VOTE; TO PROVIDE THAT ALL PROXY VOTES SHALL BE POSTED ON THE RELEVANT PUBLIC PLAN WEBSITE AND SHALL BE AGGREGATED AND REPORTED ANNUALLY TO THE APPLICABLE GOVERNMENT ENTITY OR OFFICIAL TO BE PUBLICLY ARCHIVED; TO PROVIDE THAT A BENEFICIARY OF A PLAN MAY BRING AN ACTION IN DISTRICT COURT TO RESTRAIN OR ENJOIN AN INVESTMENT MANAGER OR PROXY ADVISOR FROM CASTING A PROXY VOTE BASED ON NONPECUNIARY FACTORS; TO PROVIDE THAT ALL MEETINGS OF PUBLIC TRUST FIDUCIARIES, INCLUDING PUBLIC RETIREMENT SYSTEM FIDUCIARIES, SHALL BE OPEN TO THE PUBLIC; TO REQUIRE THE GOVERNING BODY OF A PUBLIC TRUST, INCLUDING A PUBLIC RETIREMENT SYSTEM, TO SUBMIT A REPORT TO THE OFFICE OF THE STATE TREASURER; TO BRING FORWARD SECTIONS 7-7-9, 7-9-9, 17-21-53, 17-21-55, 19-9-29, 21-27-57, 21-41-43, 21-33-323, 25-58-3, 27-105-21, 27-105-33, 27-105-301, 27-105-365, 27-105-367, 29-3-113, 31-19-5, 37-59-37, 37-59-43, 51-29-91, 51-31-17, 51-35-340, 57-61-37, 65-19-47, 65-33-57, 83-43-23, 91-13-8, 25-11-121 AND 25-11-407, MISSISSIPPI CODE OF 1972, WHICH RELATE TO THE STATE FISCAL OFFICER, POWERS AND DUTIES OF THE STATE TREASURER, INVESTING SURPLUS FUNDS OF COUNTIES AND MUNICIPALITIES, USE OF PUBLIC UTILITIES AND TRANSPORTATION REVENUES, SPECIAL IMPROVEMENT BOND FUND, INVESTMENT AUTHORITY OF MUNICIPALITIES, SURPLUS OF FUNDS OF THE GEOGRAPHIC INFORMATION SYSTEM, STATE DEPOSITORIES INTEREST ON FUNDS AND INVESTMENT OF EXCESS FUNDS, DEPOSIT OF FUNDS BY LEVEE DISTRICTS, HOSPITAL FUNDS, LOCAL GOVERNMENTS' AUTHORITY TO TRANSFER FUNDS TO OTHER FUNDS, SIXTEENTH SECTION AND LIEU LANDS INVESTMENT OF FUNDS, PERMITTED INVESTMENTS OF PUBLIC BUSINESS, BONDS AND OBLIGATIONS, SURPLUS FUNDS INVESTED OF SCHOOL BONDS AND OBLIGATIONS, DRAINAGE DISTRICTS, MISSISSIPPI BUSINESS INVESTMENT ACT, SURPLUS FUNDS OF SEPARATE ROAD DISTRICTS, INVESTMENTS OF NONPROFIT DENTAL SERVICE CORPORATIONS, REGISTERED INVESTMENT COMPANIES OR TRUSTS, SOCIAL SECURITY AND PUBLIC EMPLOYEES' RETIREMENT AND DISABILITY BENEFITS INVESTMENT OF EXCESS FUNDS, POWERS AND DUTIES OF THE BOARD OF TRUSTEES OF THE PUBLIC EMPLOYEES' RETIREMENT SYSTEM REGARDING INVESTMENTS, AND DESIGNATION OF CERTAIN INVESTMENT COMPANIES, FOR PURPOSES OF POSSIBLE AMENDMENT; AND FOR RELATED PURPOSES.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:
SECTION 1. This act shall be known and may be cited as the Proxy Voting Integrity and Transparency Act.
SECTION 2. (1) The State Treasurer shall post a current list of the state's investments by name and investment managers on the State Treasurer's publicly accessible website, and shall update any changes to the list within thirty (30) calendar days.
(2) All state investments made by the State Treasurer shall be made in the sole interest of the beneficiary. The State Treasurer's evaluation of an investment must be based on pecuniary factors as prescribed in Section 3 of this act.
SECTION 3. As used in this act, the following words and phrases shall have the meanings as defined in this section unless the context clearly indicates otherwise:
(a) "Pecuniary factor" means a factor that has a material effect on the financial risk or the financial return of an investment based on investment horizons consistent with a plan's investment objectives and funding policy.
(b) "Plan" means any fund or program that is established or maintained by this state or a political subdivision of this state, including a university under the jurisdiction of the state higher education governing body and a community college district, to do any of the following:
(i) Provide retirement income or other retirement benefits to employees or former employees.
(ii) Defer income by employees for a period of time extending to the termination of covered employment or beyond.
(iii) Invest taxpayer monies for any purpose.
(c) "Governmental entity" means any agency, department, institution, instrumentality, or political subdivision of the State of Mississippi, or any agency, department, institution of a political subdivision.
SECTION 4. (1) A governmental entity that establishes or maintains a plan must make all direct investment decisions based solely on pecuniary factors when evaluating a proxy vote.
A factor cannot qualify as a pecuniary factor if the investment agent that has labeled the factor a pecuniary factor cannot demonstrate that the factor is likely to have a material effect on the public fund's financial returns after having undertaken objective analysis of the factor that includes all materially relevant considerations.
(2) A governmental entity that establishes or maintains a plan must vote all directly held shares, or have the governmental entity's directly held shares voted, based solely on pecuniary factors when voting proxies.
(3) If a governmental entity that establishes or maintains a plan has indirect investments or commingled investments, the governmental entity must notify the general partner or investment manager that in all cases where the governmental entity has the option, the general partner or investment manager must:
(a) Make investment decisions based solely on pecuniary factors when evaluating an investment.
(b) Proportionally vote directly held shares, or have the governmental entity's directly held shares proportionally voted, based solely on pecuniary factors.
(4) A plan may not adopt a practice of following the recommendations of a proxy advisory firm or other service provider unless such firm or service provider agrees in writing to following proxy voting guidelines set by plan fiduciaries and that are consistent with the fiduciary's obligation to act based only on pecuniary factors.
(5) A fiduciary violates its duty to act solely in the pecuniary interest of plan participants and beneficiaries when it encourages, promotes, stewards or otherwise pressures a portfolio company to engage in or take action that is not in that company's or its investors' best financial interests or promotes a nonpecuniary benefit.
SECTION 5. (1) All proxy votes shall be posted on the relevant public plan website no later than the earlier of: the seventh day before the date a proxy vote is to be cast; or forty-eight (48) hours after receiving a vote recommendation from the proxy advisor on the proxy vote. For each vote, the report shall contain a vote caption, the plan's vote, the recommendation of company management, and, if applicable, the proxy advisor's recommendation.
(2) All proxy votes shall be aggregated and reported annually to the applicable government entity or official to be publicly archived. For each vote, the report shall contain a vote caption, the plan's vote, the recommendation of company management, and, if applicable, the proxy advisor's recommendation.
(3) Reporting required under this section shall be posted on a publicly available webpage on the relevant public trust's website.
SECTION 6. A beneficiary of a plan may bring an action in district court to restrain or enjoin an investment manager or proxy advisor from casting a proxy vote based on nonpecuniary factors. The court may award court costs and reasonable attorney's fees to a party who prevails in an action brought under this section.
SECTION 7. Notwithstanding any other law to the contrary, all meetings of public trust fiduciaries, including public retirement system fiduciaries, shall be open to the public. Each meeting shall be publicly broadcast in audio and video at the time it is conducted and archived on the website of the system within seven (7) days for future public access and use for no less than ten (10) years.
SECTION 8. Not later than November 1 of each year, the governing body of a public trust, including a public retirement system, shall submit a report to the Office of the State Treasurer that provides the name of each limited partnership the trust was a party to during the previous fiscal year.
SECTION 9. Section 7-7-9, Mississippi Code of 1972, is brought forward as follows:
7-7-9. The Mississippi General Accounting Office shall maintain a complete system of general accounting to comprehend the financial transactions of every state department, division, officer, board, commission, institution or other agency owned or controlled by the state, except those agencies specifically exempted in Section 7-7-1, whether at the seat of government or not and whether the funds upon which they operate are channeled through the State Treasury or not, either through regular procedures having to do with the issuance of the State Fiscal Officer receipt warrants and disbursement warrants or through controls maintained through reports filed periodically as required by the State Fiscal Officer in accordance with the reporting provisions contained in said Section 7-7-1.
All transactions in public funds, as defined in Section 7-7-1, shall either be handled directly through the State Fiscal Officer and the State Treasury, or shall be reported to the State Fiscal Officer at the times and in the form prescribed by the State Fiscal Officer and the Legislative Budget Office, so that a complete and comprehensive system of accounts of the fiscal activities of all state governmental agencies shall be made available at all times in the General Accounting Office.
SECTION 10. Section 7-9-9, Mississippi Code of 1972, is brought forward as follows:
7-9-9. It shall be the duty of the State Treasurer to receive and keep the moneys of the state in the manner provided by law, to disburse the same agreeably to law, and to take receipts or vouchers for moneys which he shall disburse. He shall keep regular, fair, and proper accounts of the receipts and expenditures of the public money; he shall keep accounts in his books in the name of the state, in which he shall enter the amount of all money, stock, securities, and all other property in the Treasury or which may at any time be received by him, keeping the receipts and disbursements of each fiscal year in separate accounts, and closing the same with the close of the fiscal year; and he shall open and keep accounts in his books for all appropriations of money made by law, so that the appropriation of money and the application thereof in conformity thereto may clearly and distinctly appear on the books of the Treasury.
SECTION 11. Section 17-21-53, Mississippi Code of 1972, is brought forward as follows:
17-21-53. (1) Before any money is borrowed under the provisions of this article, the governing authority shall adopt a resolution declaring the necessity for such borrowing and specifying the purpose for which the money borrowed is to be expended, the amount to be borrowed, the date or dates of the maturity thereof, and how such indebtedness is to be evidenced. The resolution shall be certified over the signature of the head of the governing authority.
(2) The borrowing shall be evidenced by negotiable notes or certificates of indebtedness of the governing authority which shall be signed by the head and clerk of such governing authority. All such notes or certificates of indebtedness shall be offered at public sale by the governing authority after not less than ten (10) days' advertising in a newspaper having general circulation within the governing authority. Each sale shall be made to the bidder offering the lowest rate of interest or whose bid represents the lowest net cost to the governing authority; however, the rate of interest shall not exceed that now or hereafter authorized in Section 75-17-101, Mississippi Code of 1972. No such notes or certificates of indebtedness shall be issued and sold for less than par and accrued interest. All notes or certificates of indebtedness shall mature in approximately equal installments of principal and interest over a period not to exceed five (5) years from the dates of the issuance thereof. Principal shall be payable annually, and interest shall be payable annually or semiannually; provided, however, that the first payment of principal or interest may be for any period not exceeding one (1) year. Provided, however, if negotiable notes are outstanding from not more than one (1) previous issue authorized under the provisions of this article, then the schedule of payments for a new or supplementary issue may be so adjusted that the schedule of maturities of all notes or series of notes hereunder shall, when combined, mature in approximately equal installments of principal and interest over a period of five (5) years from the date of the new or supplementary issue, or if a lower interest rate will thereby be secured on notes previously issued and outstanding, a portion of the proceeds of any issue authorized hereunder may be used to refund the balance of the indebtedness previously issued under the authority of this article. Such notes or certificates of indebtedness shall be issued in such form and in such denominations as may be determined by the governing authority and may be made payable at the office of any bank or trust company selected by the governing authority. In such case, funds for the payment of principal and interest due thereon shall be provided in the same manner provided by law for the payment of the principal and interest due on bonds issued by the governing authority.
(3) For the prompt payment of notes or certificates of indebtedness at maturity, both principal and interest, the full faith, credit and resources of the issuing entity are pledged. If the issuing entity does not have available funds in an amount sufficient to provide for the payment of principal and interest according to the terms of such notes or certificates of indebtedness, then the governing authority shall annually levy a special tax upon all of its taxable property at a rate the avails of which will be sufficient to provide such payment. Funds derived from any such tax shall be paid into a sinking fund and used exclusively for the payment of principal of and interest on the notes or certificates of indebtedness. Until needed for expenditure, monies in the sinking fund may be invested in the same manner as the governing authority is elsewhere authorized by law to invest surplus funds.
SECTION 12. Section 17-21-55, Mississippi Code of 1972, is brought forward as follows:
17-21-55. The proceeds of any notes or certificates of indebtedness issued under the provisions of this article shall be placed in a special fund and shall be expended only for the purpose or purposes for which they were issued as shown by the resolution authorizing the issuance thereof. If a balance shall remain of the proceeds of such notes or certificates of indebtedness after the purpose or purposes for which they were issued shall have been accomplished, such balance shall be used to pay such obligations at or before maturity and may be transferred to any sinking fund previously established for the payment thereof.
Proceeds from the sale of notes or certificates of indebtedness not immediately necessary for expenditure shall be invested in the same manner as surplus funds of the governing authority may be invested.
SECTION 13. Section 19-9-29, Mississippi Code of 1972, is brought forward as follows:
19-9-29. Whenever any county shall have on hand any bond and interest funds, any funds derived from the sale of bonds, special funds, or any other funds in excess of the sums which will be required to meet the current needs and demands of no more than seven (7) business days, the board of supervisors of such county shall invest such excess funds in the following manner:
(a) Such excess funds shall be invested for periods of from fourteen (14) days to one (1) year in interest-bearing time certificates of deposit with or through county depositories serving in accordance with Section 27-105-303 which are willing to accept the same, at a negotiated rate of interest. The negotiated rate of interest shall be at the highest rate possible at the date of purchase or investment for such time certificates of deposit or interest-bearing accounts, but such rate of interest shall not be less than the rate of interest paid to the general public on passbook savings. The rate of interest established herein shall be the minimum rate of interest and there shall be no maximum rate of interest.
(b) The balance, if any, of such excess funds shall be invested in interest-bearing time certificates of deposit for the same maturity periods and at the same rate of interest as prescribed in paragraph (a) of this section in or through state depositories located in such county which are willing to accept the same, to the same extent as such depositories are eligible for invested state funds.
(c) To the extent that the board of supervisors finds that such excess funds cannot be invested pursuant to paragraphs (a) and (b) of this section for the stated maturity of from fourteen (14) days to one (1) year, the board of supervisors may invest such funds in any bonds or other direct obligations of the United States of America, the State of Mississippi, or any county, municipality or school district of this state, if such county, municipal or school district bonds have been approved by a reputable bond attorney or have been validated by a decree of the chancery court, or the board of supervisors may invest such funds, together with any other funds required for current operation, in obligations issued or guaranteed in full as to principal and interest by the United States of America which are subject to a repurchase agreement with a county or state depository, or the board of supervisors may deposit such funds in interest-bearing accounts with a county or state depository. Such bonds or obligations purchased may have any maturity date, provided that they shall mature or be redeemable prior to the time that the funds so invested will be needed for expenditure.
Any excess funds invested in certificates of deposit or interest-bearing accounts with county or state depositories under this section shall be secured in the manner required by Section 27-105-315. The proceeds of such certificates of deposit shall be immediately reinvested on the date of maturity in accordance with paragraphs (a), (b) and (c) of this section, unless the board of supervisors determines that such funds are required for current operation.
When bonds or other obligations have been purchased, the same may be sold or surrendered for redemption at any time, except certificates of deposit which must mature, by order or resolution of such board of supervisors. The president of the board of supervisors, when authorized by such order or resolution, shall have the power and authority to execute all instruments and take such other action as may be necessary to effectuate the sale or redemption thereof. When such bonds or other obligations are sold or redeemed, the proceeds thereof, including accrued interest thereon, shall be paid into the same fund as that from which the investment was made and shall in all respects be dealt with as are other monies in such fund. Except as hereinafter provided, any interest derived from the investments authorized in this section may, as an alternative, be deposited into the general fund of the county. Any interest derived from the investment of sums received under the terms of the federal State and Local Fiscal Assistance Act of 1972, and any subsequent revisions or reenactments of that act, shall be paid into the same fund as that from which the investment was made. Any interest derived from the investment of school bond funds shall be handled as provided in Section 37-59-43. Any interest derived from investment of other bond proceeds or from investment of any bond and interest fund, bond reserve fund or bond redemption sinking fund shall be deposited either in the same fund from which the investment was made or in the bond and interest fund established for payment of the principal or interest on the bonds. Any interest derived from special purpose funds which are outside the function of general county government shall be paid into that special purpose fund.
SECTION 14. Section 21-27-57, Mississippi Code of 1972, is brought forward as follows:
21-27-57. In the authorizing order or ordinance, the governing authorities of the municipality shall set aside monthly and shall pledge the revenues of the system or combined system, in separate and special funds as follows: (1) operation and maintenance fund; (2) depreciation fund; (3) bond and interest fund; (4) contingent fund. A sufficient amount shall be set aside each year for the retirement of the bonds and interest. Any surplus revenue remaining shall be disposed of by the governing authorities of the municipality as they may determine from time to time for the best interest of the municipality. However, in the segregation into the several funds the governing authorities may prescribe a reasonable excess amount to be placed in the revenue bond and interest fund from time to time during the earlier years of maturity of such bonds so as to thereby provide and produce a cushion fund to meet any possible deficiencies therein in future years. In the event such excess amounts are provided in the earlier years, the same would be available for such purposes. Bonds pursuant to the authority granted in Sections 21-27-23 and 21-27-51, shall be payable solely from revenues of said project and out of the bond and interest fund.
SECTION 15. Section 21-41-43, Mississippi Code of 1972, is brought forward as follows:
21-41-43. All obligations issued pursuant to Section 21-41-41 shall mature not longer than twenty (20) years from the date thereof, and shall be divided into approximately equal payments, with one (1) payment falling due each year. The obligations shall bear interest at a rate not exceeding that allowed in Section 75-17-101, payable annually or semiannually, and principal and interest on same shall be payable at such place within or without the state as may be designated by the issuing authorities at the time the obligations are issued. The full faith, credit and resources of the issuing municipality shall be pledged for the payment of the principal and interest on the obligations and the governing authorities of the municipality shall annually levy a tax on all taxable property in the municipality sufficient for such purposes, and where the obligations are issued for the purpose of making any of the special improvements set forth in this chapter, the cost of which is to be paid from assessments levied against the property abutting on the special improvement to be made under this chapter, the assessments shall also be pledged for the payment of the obligations. The funds derived from the taxes levied to pay the obligations shall be kept in a special fund to be known as the "Special Improvement Bond Fund," and shall be used only for the purpose of paying principal and interest on the obligations. All funds derived from special assessments levied against the property abutting on the special improvements shall likewise be placed into the Special Improvement Bond Fund and shall be used only for the purpose of paying principal and interest on the obligations. Any surplus funds may be invested as provided by law, and may be used to pay the obligations at or before maturity.
SECTION 16. Section 21-33-323, Mississippi Code of 1972, is brought forward as follows:
21-33-323. (1) Whenever any municipality shall have on hand any bond and interest funds, any funds derived from the sale of bonds, special funds, or any other funds in excess of the sums which will be required for immediate expenditure and which are not needed or cannot by law be used for the payment of the current obligations or expenses of such municipality, the governing authorities of such municipality shall have the power and authority to invest such excess funds in any bonds or other direct obligations of the United States of America or the State of Mississippi, or of any county or municipality of this state, or of any school district, which such county or municipal or school district bonds have been approved by a reputable bond attorney or have been validated by a decree of the chancery court, or in obligations issued or guaranteed in full as to principal and interest by the United States of America which are subject to a repurchase agreement with a qualified depository. In any event the bonds or obligations in which such funds are invested shall mature or be redeemable prior to the time the funds so invested will be needed for expenditure.
(2) However, such excess funds may first be offered for investment in interest-bearing accounts with or through municipal depositories serving in accordance with Section 27-105-353 at a rate of interest not less than a simple interest rate numerically equal to the average bank discount rate on United States Treasury bills of comparable maturity. The rate of interest established herein shall be the minimum rate of interest and there shall be no maximum rate of interest.
(3) Such excess funds may also be invested in interest-bearing accounts in or through state depositories located in such municipality to the same extent as such depositories are eligible for invested state funds.
(4) When bonds or other obligations have been so purchased, the same may be sold or surrendered for redemption at any time by order or resolution of the governing authorities of the municipality, and the mayor of the municipality, when authorized by such order or resolution, shall have the power and authority to execute all instruments and take such other action as may be necessary to effectuate the sale or redemption thereof.
(5) When such bonds or other obligations are sold or redeemed, the proceeds thereof, including accrued interest thereon, shall be paid into the same fund as that from which the investment was made and shall in all respects be dealt with as are other monies in such fund.
(6) Except as hereinafter provided, any interest derived from the investments authorized in this section may, as an alternative, be deposited into the general fund of the municipality. Any interest derived from the investment of sums received under the terms of the federal State and Local Fiscal Assistance Act of 1972 and any subsequent revisions or reenactments of that act shall be paid into the same fund as that from which the investment was made. Any interest derived from the investment of school bond funds shall be handled as provided in Section 37-59-43. Any interest derived from investment of other bond proceeds or from investment of any bond and interest fund, bond reserve fund or bond redemption sinking fund shall be deposited either in the same fund from which the investment was made or in the bond and interest fund established for payment of the principal or interest on the bonds. Any interest derived from special purpose funds which are outside the function of general municipal government shall be paid into that special purpose fund.
(7) The authority granted by this section shall be cumulative and in addition to any other law relating to the investment of funds by municipalities.
SECTION 17. Section 25-58-3, Mississippi Code of 1972, is brought forward as follows:
25-58-3. (1) The board of supervisors of any county and the governing authorities of any municipality (both referred to in this section as "governing authority") are hereby authorized and empowered, in their discretion, to borrow money, pursuant to the provisions of this section to create the geographic information system and prepare the multipurpose cadastre authorized in Section 25-58-1.
(2) Before any money is borrowed under the provisions of this section, the governing authority shall adopt a resolution declaring the necessity for such borrowing and specifying the purpose for which the money borrowed is to be expended, the amount to be borrowed, the date or dates of the maturity thereof, and how such indebtedness is to be evidenced. The resolution shall be certified over the signature of the head of the governing authority.
(3) The borrowing shall be evidenced by negotiable notes or certificates of indebtedness of the governing authority which shall be signed by the principal officer and clerk of such governing authority. All such notes or certificates of indebtedness shall be offered at public sale by the governing authority after not less than ten (10) days' advertising in a newspaper having general circulation within the governing authority. Each sale shall be made to the bidder offering the lowest rate of interest or whose bid represents the lowest net cost to the governing authority; however, the rate of interest shall not exceed that now or hereafter authorized in Section 75-17-101, Mississippi Code of 1972. No such notes or certificates of indebtedness shall be issued and sold for less than par and accrued interest. All notes or certificates of indebtedness shall mature in approximately equal installments of principal and interest over a period not to exceed ten (10) years from the dates of the issuance thereof. Principal shall be payable annually, and interest shall be payable annually or semiannually; provided, however, that the first payment of principal or interest may be for any period not exceeding one (1) year. Provided, however, if negotiable notes are outstanding from not more than one (1) previous issue authorized under the provisions of this section, then the schedule of payments for a new or supplementary issue may be so adjusted that the schedule of maturities of all notes or series of notes hereunder shall, when combined, mature in approximately equal installments of principal and interest over a period of ten (10) years from the date of the new or supplementary issue, or if a lower interest rate will thereby be secured on notes previously issued and outstanding, a portion of the proceeds of any issue authorized hereunder may be used to refund the balance of the indebtedness previously issued under the authority of this article. Such notes or certificates of indebtedness shall be issued in such form and in such denominations as may be determined by the governing authority and may be made payable at the office of any bank or trust company selected by the governing authority. In such case, funds for the payment of principal and interest due thereon shall be provided in the same manner provided by law for the payment of the principal and interest due on bonds issued by the governing authority.
(4) For the prompt payment of notes or certificates of indebtedness at maturity, both principal and interest, the full faith, credit and resources of the issuing entity are pledged. Furthermore, the governing authority may annually levy a special tax in an amount not to exceed three (3) mills upon all of its taxable property, the avails of which shall be paid into a sinking fund and used exclusively for the payment of principal of and interest on the notes or certificates of indebtedness. Until needed for expenditure, monies in the sinking fund may be invested in the same manner as the governing authority is elsewhere authorized by law to invest surplus funds.
(5) The proceeds of any notes or certificates of indebtedness issued under the provisions of this section shall be placed in a special fund and shall be expended only for the purpose or purposes for which they were issued as shown by the resolution authorizing the issuance thereof. If a balance shall remain of the proceeds of such notes or certificates of indebtedness after the purpose or purposes for which they were issued shall have been accomplished, such balance shall be used to pay such obligations at or before maturity and may be transferred to any sinking fund previously established for the payment thereof.
(6) Proceeds from the sale of notes or certificates of indebtedness not immediately necessary for expenditure shall be invested in the same manner as surplus funds of the governing authority may be invested.
(7) Regardless of the method of paying for the creation of a geographic information system or for the preparation of a multipurpose cadastre, and notwithstanding anything in the Mississippi Public Records Act Section 25-61-1 et seq., to the contrary, a county or municipality which has created or acquired a geographic information system or prepared a multipurpose cadastre may assess a fee or charge in accordance with the provisions of Section 25-61-7(2). However, all fees shall be subject to a standard scale adopted by the governing authority. If the governing authority has issued notes or certificates of indebtedness, any fees shall be deposited into the sinking fund and used exclusively for payment of principal and interest on the notes or certificates of indebtedness until paid in full. Thereafter, the fees shall be deposited into the county's or municipality's general fund.
SECTION 18. Section 27-105-21, Mississippi Code of 1972, is brought forward as follows:
27-105-21. All institutions and departments which withdraw funds from the State Treasury, all agencies and departments of the state government whose funds are not deposited in the State Treasury, and all agencies and departments of the state government which maintain imprest funds are hereby authorized, empowered and directed to deposit their funds, except and less an amount approved by the auditor which shall be sufficient to cover disbursements for current operations, at interest with any qualified depository of the state at a rate of interest numerically equal to or greater than one half of one percent (½ of 1%) below the bank discount rate on United States Treasury bills of comparable maturity as determined by the State Depository Commission. Such institutions and departments may, to the extent that they are unable to invest in certificates of deposit for periods of fourteen (14) days or longer at a rate numerically equal to or greater than one half of one percent (½ of 1%) below the treasury bill rate, deposit funds in sums of less than One Hundred Thousand Dollars ($100,000.00) in such other type of interest bearing account as may be now or hereafter authorized by law. Interest earned on funds withdrawn from the General Fund shall be deposited in the General Fund; interest earned on other funds shall be deposited to the fund from which the investment was made, unless otherwise required by law. Any agency not reporting through the State Treasurer's office shall file with the Legislature an annual report showing monthly balances, monthly investments and interest earned for the preceding fiscal year or part thereof. A depository holding funds pursuant to this section shall be eligible to hold such funds to the extent that it is qualified as a depository for state funds.
SECTION 19. Section 27-105-33, Mississippi Code of 1972, is brought forward as follows:
27-105-33. It shall be the duty of the State Treasurer and the Executive Director of the Department of Finance and Administration on or about the tenth day of each month, and in their discretion at any other time, to analyze carefully the amount of cash in the General Fund of the state and in all special funds credited to any special purpose designated by the State Legislature or held to meet the budgets or appropriations for maintenance, improvements and services of the several institutions, boards, departments, commissions, agencies, persons or entities of the state, and to determine in their opinion when the cash in such funds is in excess of the amount required to meet the current needs and demands of no more than seven (7) business days on such funds and report their findings to the Governor. It shall be the duty of the State Treasurer to provide a cash flow model for forecasting revenues and expenditures on a bimonthly basis and providing technical assistance for its operation. The Department of Finance and Administration shall use the cash flow model furnished by the State Treasurer, in analyzing the amount of funds on deposit and available for investment.
The State Treasurer is hereby authorized, empowered and directed to invest all such excess general and special funds of the state in the following manner:
(a) Funds shall be allocated equally among all qualified state depositories which do not have demand accounts in excess of One Hundred Fifty Thousand Dollars ($150,000.00) until each qualified depository willing to accept the same shall have on deposit or in security repurchase agreements or in other securities authorized in paragraph (d) of this section at interest the sum of Three Hundred Thousand Dollars ($300,000.00). For the purposes of this subsection, no branch bank or branch office shall be counted as a separate depository.
(b) The balance, if any, of such excess general and special funds shall be offered to qualified depositories of the state on a pro rata basis as provided in Section 27-105-9. For the purposes of this subsection, the pro rata share of each depository shall be reduced by the amount of the average daily collected earning balance of demand deposits maintained by the State Treasurer pursuant to Section 27-105-9 during the preceding calendar year, and such reduction shall be allocated pro rata among other eligible depositories.
(c) Funds offered pursuant to paragraphs (a) and (b) above shall be invested for periods of up to one (1) year, and shall bear interest at an interest rate no less than that numerically equal to the bond equivalent yield on direct obligations of the United States Treasury of comparable maturity, as determined by the State Treasurer. In determining such rate, the State Treasurer shall consider the Legislature's desire to distribute funds equitably throughout the state to the maximum extent possible.
(d) To the extent that the State Treasurer shall find that general and special funds cannot be invested pursuant to paragraphs (a), (b) and (c) of this section for the stated maturity up to one (1) year, the Treasurer may invest such funds, together with any other funds required for current operation, as determined pursuant to this section, in the following:
(i) Time certificates of deposit or interest-bearing accounts with qualified state depositories. For those funds determined under prudent judgment of the State Treasurer to be made available for investment in time certificates of deposit, the rate of interest paid by the depositories shall be determined by rules and regulations adopted and promulgated by the State Treasurer which may include competitive bids. At the time of investment, the interest rate on such certificates of deposit under the provisions of this subparagraph shall be a rate not less than the bond equivalent yield on direct obligations of the United States Treasury with a similar length of maturity.
(ii) Direct United States Treasury obligations, the principal and interest of which are fully guaranteed by the government of the United States.
(iii) United States government agency, United States government instrumentality or United States government-sponsored enterprise obligations, the principal and interest of which are fully guaranteed by the government of the United States, such as the Government National Mortgage Association; or United States governmental agency, United States government instrumentality or United States government-sponsored enterprise obligations, the principal and interest of which are guaranteed by any United States government agency, United States government instrumentality or United States government-sponsored enterprise contained in a list promulgated by the State Treasurer.
(iv) Direct security repurchase agreements and reverse direct security repurchase agreements of any federal book entry of only those securities enumerated in subparagraphs (ii) and (iii) above. "Direct security repurchase agreement" means an agreement under which the state buys, holds for a specified time, and then sells back those securities and obligations enumerated in subparagraphs (ii) and (iii) above. "Reverse direct securities repurchase agreement" means an agreement under which the state sells and after a specified time buys back any of the securities and obligations enumerated in subparagraphs (ii) and (iii) above. A qualified state depository shall be given preference for such agreements when possible.
(v) Bonds issued, assumed or guaranteed by the Country of Israel, provided that:
1. Investments in such instruments shall be denominated in United States currency;
2. Such bonds must be of investment grade as rated by at least one (1) nationally recognized statistical rating agency; and
3. The amount of funds invested in such bonds at any time shall not exceed Twenty Million Dollars ($20,000,000.00).
(vi) Corporate bonds and taxable municipal bonds; or corporate short-term obligations of corporations or of wholly owned subsidiaries of corporations, whose short-term obligations are rated A-1 or better by Standard and Poor's, rated P-1 or better by Moody's Investment Service, F-1 or better by Fitch Ratings, Ltd., or the equivalent of these ratings if assigned by another United States Securities and Exchange Commission designated Nationally Recognized Statistical Rating Organization.
(e) For the purposes of this section, direct obligations issued by the United States of America shall be deemed to include securities of, or other interests in, any open-end or closed-end management type investment company or investment trust registered under the provisions of 15 USCS Section 80(a)-1 et seq., provided that the portfolio of such investment company or investment trust is limited to direct obligations issued by the United States of America, United States government agencies, United States government instrumentalities or United States government-sponsored enterprises, and to repurchase agreements fully collateralized by direct obligations of the United States of America, United States government agencies, United States government instrumentalities or United States government-sponsored enterprises, and the investment company or investment trust takes delivery of such collateral for the repurchase agreement, either directly or through an authorized custodian. The State Treasurer and the Executive Director of the Department of Finance and Administration shall review and approve the investment companies and investment trusts in which funds invested under paragraph (d) of this section may be invested. The total dollar amount of funds invested in all open-end and closed-end management type investment companies and investment trusts at any one time shall not exceed twenty percent (20%) of the total dollar amount of funds invested under paragraph (d) of this section.
(f) Investments authorized by subparagraphs (ii) and (iii) of paragraph (d) shall mature on such date or dates as determined by the State Treasurer in the exercise of prudent judgment to generate a favorable return to the state and will allow the monies to be available for use at such time as the monies will be needed for state purposes. However, the maturity of securities purchased as enumerated in subparagraphs (ii) and (iii) shall not exceed ten (10) years from date of purchase. Special funds shall be considered those funds created constitutionally, statutorily or administratively which are not considered general funds. All funds invested for a period of thirty (30) days or longer under paragraph (d) shall bear a rate at least equal to the current established rate under paragraph (c) of this section.
(g) Any interest-bearing deposits or certificates of deposit shall not exceed at any time the amount insured by the Federal Deposit Insurance Corporation in any one (1) banking institution, the Federal Savings and Loan Insurance Corporation in any one (1) savings and loan association, or other deposit insurance corporation approved by the State Treasurer, unless the uninsured portion is collateralized by the pledge of securities in the manner provided by Section 27-105-5.
(h) Unless otherwise provided, income from investments authorized by the provisions of this subsection shall be credited to the State General Fund.
(i) Not more than Five Hundred Thousand Dollars ($500,000.00) of funds may be invested with foreign financial institutions, and the State Treasurer may enter into price contracts for the purchase or exchange of foreign currency or other arrangements for currency exchange in an amount not to exceed Five Hundred Thousand Dollars ($500,000.00) upon specific direction of the Department of Economic and Community Development. The State Treasurer shall promulgate all rules and regulations for applications, qualifications and any other necessary matters for foreign financial institutions.
Any liquidating agent of a depository in liquidation, voluntary or involuntary, shall redeem from the state any bonds and securities which have been pledged to secure state funds and such redemption shall be at the par value or market value thereof, whichever is greater; otherwise, The liquidating agent or receiver may pay off the state in full for its deposits and retrieve the pledged securities without regard to par or market value.
The State Treasurer and the Executive Director of the Department of Finance and Administration shall make monthly reports to the Legislative Budget Office containing a full and complete statement of all funds invested by virtue of the provisions of this section and the revenues derived therefrom and the expenses incurred therewith, together with all such other information as may seem to each of them as being pertinent to inform fully the Mississippi Legislature with reference thereto.
The State Treasurer shall not deposit any funds on demand deposit with any authorized depository, unless such depository has contracted for interest-bearing accounts or time certificates of deposit.
Notwithstanding the foregoing, any financial institution not meeting the prescribed ratio requirement set forth in Section 27-105-5 whose accounts are insured by the Federal Deposit Insurance Corporation, or any successor to that insurance corporation, may receive state funds in an amount not exceeding the amount which is insured by such insurance corporations and may qualify as a state depository to the extent of such insurance for this purpose only. The paid-in and earned capital funds of such financial institution shall not be included in the computations specified in Section 27-105-9(a) and (b).
SECTION 20. Section 27-105-301, Mississippi Code of 1972, is brought forward as follows:
27-105-301. The adoption of this code shall not be construed as repealing any law or laws providing for deposits by and loans of the Board of Commissioners for the Yazoo-Mississippi Delta Levee District and the Board of Mississippi Levee Commissioners.
SECTION 21. Section 27-105-365, Mississippi Code of 1972, is brought forward as follows:
27-105-365. (1) The commissioners or board of trustees of any hospital owned and operated separately or jointly by one or more counties, cities, towns, supervisors districts, or election districts or combinations thereof, including hospitals established under the authority of Sections 41-13-1 through 41-13-9, as now or hereafter amended, are hereby authorized and empowered to deposit the funds of such hospital in or through one or more financial institutions whose accounts are insured by the Federal Deposit Insurance Corporation, selected by the board of trustees in the same manner as county depositories are selected by boards of supervisors pursuant to Section 27-105-305, located in its county or counties, except as otherwise provided in the following paragraphs.
At the regular December meeting of the board of trustees in 1995, or at any regular December meeting of the board thereafter, the board may, in its discretion, give notice by publication to all financial institutions in its county or counties whose accounts are insured by the Federal Deposit Insurance Corporation, that bids will be received from financial institutions at the following January meeting, or some subsequent meeting, for the privilege of keeping the hospital funds or any part thereof for a period of three (3) years, subject to earlier termination as authorized in this subsection. Such bids shall be submitted and accepted in the same manner as provided in Section 27-105-305. After the board has selected a depository or depositories as provided in this subsection, the board may, at any regular December meeting during the three-year period, give notice to and receive bids from financial institutions in the manner provided in this subsection, for the privilege of keeping the hospital funds or any part thereof for a period of three (3) years, subject to earlier termination as authorized in this subsection; and after receiving such bids, the board may reject all bids and elect to keep the funds in the current depository or depositories for the remainder of the three-year period under the terms originally agreed to with the depository or depositories, or if the board determines it to be in the best interests of the hospital, it may terminate the agreement with the current depository or depositories and select a new depository or depositories or the same depository or depositories from the bids received, choosing the bid or bids proposing the best terms for the hospital.
Such hospital funds, when so deposited, shall have the same security and protection as required for county funds in Section 27-105-315. When more than one (1) depository of whatever type is authorized, the commissioners or board of trustees may select one or more of such depositories and may apportion such deposits, at their or its discretion, if more than one (1) depository is selected. If there is no financial institution located within such county or counties, the commissioners or board of trustees of such hospital may select, in their or its discretion, a depository located outside of such county or counties.
The commissioners or boards of trustees of such community hospitals shall deposit the funds of such hospital into the depository selected under this section on the day when they are received or collected, or on the next business day thereafter.
(2) The commissioners or board of trustees of any such hospital may, in their or its discretion, maintain one or more special funds for the purpose of making necessary repairs, necessary purchases of equipment, meeting operational and maintenance expenses, allowing for depreciation, providing contingent funds for emergencies, funding hospital improvements, or providing for other special needs, and may deposit any part of such special fund in accordance with the provisions contained in subsection (1) for the deposit of other funds of such hospital. Said commissioners or board of trustees may also invest any part of such special fund, any funds derived from the sale of bonds, or any other funds in excess of the sums which will be required to meet the current needs and demands of no more than seven (7) business days in the following:
(a) In any bonds or other direct obligations of the United States of America or the State of Mississippi, or of any county, school district or municipality of this state, which such county, school district or municipal bonds have been approved by a reputable bond attorney or have been validated by decree of the chancery court;
(b) In obligations issued or guaranteed in full as to principal and interest by the United States of America which are subject to a repurchase agreement with a financial institution certified as a qualified depository;
(c) In any United States government agency, United States government instrumentality, or United States government sponsored enterprise obligations, the principal and interest of which are fully guaranteed by the government of the United States, such as the Government National Mortgage Association; or any United States government agency, United States government instrumentality, or United States government sponsored enterprise obligations, the principal and interest of which are guaranteed by any United States government agency, United States government instrumentality, or United States government sponsored enterprise. However, at no time shall the funds invested in United States government agency, United States government instrumentality, or United States government sponsored enterprise obligations enumerated in the preceding sentence exceed fifty percent (50%) of all monies invested with maturities of thirty (30) days or longer. The limitation set forth in the preceding sentence shall be applicable only at the time of purchase and shall not require the liquidation of any investment at any time;
(d) In an account or accounts in or through one or more financial institutions located in this state, and such funds when so invested shall have the same security and protection as required in Section 27-105-315;
(e) In an insured account or accounts in or through one or more financial institutions in this state whose accounts are insured by the Federal Deposit Insurance Corporation; provided that the amount in any single account shall not exceed the amount which at any one time is insured by the Federal Deposit Insurance Corporation;
(f) In any open-end or closed-end management-type investment company or investment trust registered under the provisions of 15 USCS Section 80(a)-1 et seq., provided that the portfolio of such investment company or investment trust is limited to direct obligations issued by the United States of America, United States government agencies, United States government instrumentalities or United States government sponsored enterprises, and to repurchase agreements fully collateralized by direct obligations of the United States of America, United States government agencies, United States government instrumentalities or United States government sponsored enterprises, and the investment company or investment trust takes delivery of such collateral for the repurchase agreement, either directly or through an authorized custodian. The total dollar amount of funds invested in all open-end and closed-end management-type investment companies and investment trusts at any one time shall not exceed twenty percent (20%) of the total dollar amount of funds invested under this subsection. The limitation set forth in the preceding sentence shall be applicable only at the time of purchase and shall not require the liquidation of any investment at any time;
(g) In a trust fund consisting of pooled or commingled funds of other hospitals, provided that:
(i) The portfolio of such trust fund may include investments in commercial paper and bankers acceptances or other short-term obligations issued by banks having one (1) of the two (2) highest short-term rating categories of either Standard & Poor's Corporation or Moody's Investors Service, or corporate notes and bonds having one (1) of the three (3) highest long-term rating categories of either Standard & Poor's Corporation or Moody's Investors Service, or in any open-ended or closed-ended management-type investment company or investment trust registered under the provisions of 15 USCS Section 80(a)-1 et seq., that would contain the aforementioned securities;
(ii) The portfolio of such trust fund is otherwise limited to investments authorized under this section; provided, however, that such investments shall not be subject to the percentage limitations set forth in subsection (2)(c) or subsection (2)(f) of this section;
(iii) Such trust is managed by an entity with trust powers or by an investment adviser registered with the Securities and Exchange Commission and retained as an investment manager by the commissioners or the board of trustees, as the case may be; and
(iv) Any investment manager approved by the commissioners or the board of trustees, as the case may be, shall invest such commingled funds as a fiduciary.
In addition, the commissioners or the board of trustees, in their or its discretion, may invest such funds as permitted by Section 19-9-29, 21-33-323, 27-105-33 or 37-59-43, as the same may be amended from time to time.
In any event, the bonds or obligations described in paragraph (a), (b) or (c) of this subsection (2) in which such funds are invested shall mature or be redeemable prior to the time the funds so invested will be needed for expenditures. When bonds or other obligations have been so purchased, the same may be sold or surrendered for redemption at any time by order or resolution of the commissioners or board of trustees of any such hospital, and the president or vice president, when authorized by such order or resolution, shall have the power and authority to execute all instruments and take such other action as may be necessary to effectuate the sale or redemption thereof.
When any such special fund is maintained for a purpose that requires contract letting or other action by the governing authority or authorities of the counties, cities, towns, supervisors districts or election districts, separately or jointly owning and operating such hospital, the commissioners or board of trustees of the hospital may transfer the whole or any part of any such special fund to the governing authority or authorities aforesaid on condition that the same be used for such purpose or returned to the transferring commissioners or board of trustees within the time designated in the conditions.
(3) All funds which shall be derived from any tax levied for the support and maintenance of any such hospital, and all other funds which may be made available for the support and maintenance of any such hospital by the state or any county or municipality, and all fees and other monies which may be collected or received by or for such hospital shall be placed in a special fund to the credit of such hospital within sixty (60) days after collection, and all such funds shall be expended and paid out upon the allowance of the board of trustees or commissioners of the hospital, as the case may be, and disbursed by checks signed by such person, officer or officers, as may be designated by such board of trustees or commissioners. Any officer or person who shall be designated by such board of trustees or commissioners to execute such checks shall furnish to such board of trustees or commissioners a good and sufficient surety bond in such amount as such board of trustees may fix, conditioned upon the faithful discharge of his duties, and the premium on such bond shall be paid from the funds available for the support and maintenance of such hospital. No funds shall be disbursed by any such hospital until the board of trustees or the commissioners thereof shall have adopted an annual budget and submitted same to the respective governing authority or authorities of the counties, cities, towns, supervisors districts, or election districts, separately or jointly owning and operating such hospital, and until such budget shall have been approved by the governing authority or authorities, as the case may be, which approval shall be evidenced by a proper order recorded upon the minutes of each such authority. The accounts and records of any such hospital shall be audited by the State Department of Audit at the same time and in the same manner as the accounts and financial records of the county are audited, and for such purpose shall be considered in all respects as county accounts and records; however, this provision with regard to such audits shall be applicable only to hospitals owned wholly or in part by a county.
(4) The provisions of this section shall not apply to hospitals owned jointly by a city and county and operated by lease agreement or contract with a nonprofit hospital corporation.
SECTION 22. Section 27-105-367, Mississippi Code of 1972, is brought forward as follows:
27-105-367. (1) The board of supervisors and municipal governing authorities, by order spread on their minutes, may transfer any balance remaining in a special fund in the treasury of the county or municipality, as the case may be, to the general fund to be used for general purposes for the succeeding fiscal year if the purpose for which the special fund was created has been fully carried out. Taxes imposed for the succeeding fiscal year for county or municipal general purposes shall be reduced by the amount of such balance transferred from the special fund to the general fund.
(2) (a) When there is any surplus monies less than Two Thousand Five Hundred Dollars ($2,500.00) in any special fund in the treasury of any county, road district, school district or other taxing district, or any municipality, and the board of supervisors, acting for the county or any road district, school district or other taxing district thereof, or the governing authorities of the municipality, as the case may be, shall desire to transfer all or part of the surplus monies in the special fund to some other fund of said county, road district, school district or other taxing district, or said municipality, as the case may be, such board of supervisors or the governing authorities of the municipality, as the case may be, shall cause an order to be entered on their minutes declaring their intention so to do, which said order shall show the name of the special fund, the amount of surplus monies to be transferred, and the name of the fund to which it is to be transferred, and same shall be transferred accordingly.
(b) Whenever the surplus monies in any special fund shall be Two Thousand Five Hundred Dollars ($2,500.00) or more, the board of supervisors or the governing authorities of the municipality, as the case may be, desiring to transfer such surplus monies, shall cause notice of same to be published in some newspaper published in the county, district or municipality, as the case may be, for three (3) consecutive weeks or, if there be no newspaper so published, then in some newspaper having a general circulation in the county, district or municipality. Thereafter, the monies shall be transferred as stated in the order not less than thirty (30) days after the first publication in a newspaper as above stated, unless within said thirty (30) days, a petition against the proposed transfer, signed by twenty percent (20%) or fifteen hundred (1500), whichever is less, of the qualified electors residing in the county, district or municipality, as the case may be, shall be filed with the governing body. In the event such petition is filed, an election on the question of such transfer shall be called and held as herein provided. Notice of the election and manner of conducting it shall be the same as other elections conducted within counties or municipalities, as the case may be. The ballot shall have printed thereon the amount of surplus monies sought to be transferred, the purpose for which such monies were authorized to be used and a statement that a surplus exists in such fund, and the purpose for which such monies are sought to be used pursuant to their transfer. If a majority of the qualified electors voting in the election vote in favor of the transfer of surplus monies, then such monies shall be transferred. If a majority of the qualified electors voting in the election do not vote in favor of such transfer of surplus monies, then such monies shall not be transferred. Provided, however, that if the question of transferring the balance remaining in a special fund, the purpose for which such fund was created having been fully carried out, fails at an election held on same, then such monies shall be invested as authorized by law and shall be calculated in the budget for the county or municipality, as the case may be, to be used for general purposes for the succeeding fiscal year. Taxes imposed for the succeeding fiscal year for county or municipal general purposes shall be reduced by the amount of such monies in such special fund.
(3) (a) When the balance remaining in any fund as set forth in subsections (1) and (2) represents a part of the proceeds of bonds sold for such county, district or municipality, and any part of said bonds or interest thereon remains unpaid, then such balance shall be transferred to the bond and interest fund to retire said bonds and interest due thereon, regardless of the amount thereof, without the necessity of publishing the order transferring same.
(b) Surplus monies in a bond and interest fund shall not be transferred unless there remains to the credit of such fund a sufficient balance to fully retire such bonds and interest thereon, including all redeemable bond coupons and the tax levy required to be made to pay principal of and interest on such bonds as they become due has been discontinued by the governing authorities of the county or municipality, as the case may be. Surplus monies in a bond and interest fund may be transferred to the general fund in accordance with subsection (1) of this section or to other funds in accordance with subsection (2)(b) of this section, regardless of the amount of the balance to be transferred.
SECTION 23. Section 29-3-113, Mississippi Code of 1972, is brought forward as follows:
29-3-113. The principal fund shall be a permanent township fund which shall consist of funds heretofore or hereafter derived from certain uses or for certain resources of school trust lands which shall be invested and, except as otherwise provided in this section, only the interest and income derived from such funds shall be expendable by the school district.
The principal fund shall consist of:
(a) Funds received for easements and rights-of-way pursuant to Section 29-3-91;
(b) Funds received for sales of lieu land pursuant to Sections 29-3-15 through 29-3-25;
(c) Funds received from any permanent damage to the school trust land;
(d) Funds received from the sale of nonrenewable resources, including, but not limited to, the sale of sand, gravel, dirt, clays and royalties received from the sale of mineral ores, coal, oil and gas;
(e) Funds received from the sale of buildings pursuant to Section 29-3-77;
(f) Funds received from the sale of timber; and
(g) Funds received pursuant to Section 29-3-23(2).
It shall be the duty of the Board of Education to keep the principal fund invested in any direct obligation issued by or guaranteed in full as to principal and interest by the United States of America or in certificates of deposit issued by a qualified depository of the State of Mississippi as approved by the State Treasurer. The certificates of deposit may bear interest at any rate per annum which may be mutually agreed upon but in no case shall said rate be less than that paid on passbook savings.
The Board of Education is authorized to invest the funds in interest bearing deposits or other obligations of the types described in Section 27-105-33 or in any other type investment in which any other political subdivision of the State of Mississippi may invest, except that one hundred percent (100%) of the funds are authorized to be invested. For the purposes of investment, the principal fund of each township may be combined into one or more district accounts; however, the docket book of the county superintendent shall at all times reflect the proper source of such funds. Provided that funds received from the sale of timber shall be placed in a separate principal fund account, and may be expended for any of the purposes authorized by law.
The Board of Education shall have authority to borrow such funds at a rate of interest not less than four percent (4%) per annum and for a term not exceeding twenty (20) years, for the erection, equipment or repair of said district schools, to provide local funds for any building project approved by the State Board of Education or to provide additional funds for forest stand improvement as set forth in Section 29-3-47. In addition, the board may borrow the funds under the same interest restrictions for a term not exceeding ten (10) years to provide funds for the purchase of school buses. The Board of Education of any school district in any county that has an aggregate amount of assets in its principal fund in excess of Five Million Dollars ($5,000,000.00) may deduct an amount not to exceed Five Hundred Thousand Dollars ($500,000.00) for the purpose of covering the cost of asbestos removal from school district buildings. Such asbestos removal shall be construed to constitute the repair of school district facilities as prescribed in Section 29-3-115.
No school land trust funds may be expended after the annual payment date until the payment is made on such loan. Once a district is current on its loan payments, the district may spend expendable trust funds earned or accumulated in previous years for any purpose for which expendable trust funds may be spent. The annual payment can be made from any funds available to the school district except minimum foundation program funds.
It shall be unlawful for the Board of Education to borrow any sixteenth section school funds in any other manner than that prescribed herein, and if any such funds shall be borrowed or invested in any other manner, any officer concerned in making such loan and investment or suffering the same to be made in violation of the provisions of this section shall be liable personally and on his official bond for the safety of the funds so loaned.
SECTION 24. Section 31-19-5, Mississippi Code of 1972, is brought forward as follows:
31-19-5. Any funds received from the sale of bonds, notes, or certificates of indebtedness heretofore or hereafter sold by the State of Mississippi or any agency or department thereof or by any county, municipality, road district, levee district, development district, utility district, school district, drainage district or other entity authorized by law to issue bonds, notes, or certificates of indebtedness, which are not immediately required for disbursement for the purpose for which issued, may be invested by the proper authorities in any direct obligation issued by or guaranteed in full as to principal and interest by the United States of America or in certificates of deposit issued by or through a qualified depository of the State of Mississippi as approved by the State Treasurer, maturing or being redeemable by the holder on or prior to the date upon which such funds will be required for disbursement and bearing interest at a rate per annum not less than a simple interest rate numerically equal to the average bank discount rate on United States Treasury bills of comparable maturity or the current rate of interest paid on certificates of deposit or on United States Treasury obligations of comparable maturities, whichever is the higher, provided, however, that the proceeds from the sale of bonds issued pursuant to Sections 57-1-131 through 57-1-145, Mississippi Code of 1972, or Chapter 3 of Title 57, Mississippi Code of 1972, may be invested in certificates of deposit issued by or through qualified depositories of the State of Mississippi bearing interest at any rate per annum which may be mutually agreed upon, but in no case shall said rate be less than such average bank discount rate.
Funds received pursuant to this section shall be invested as heretofore described or may be invested, pursuant to rules promulgated by the State Treasurer, in obligations described in Section 27-105-33(d), Mississippi Code of 1972; however, funds described in this section may not be invested in securities of, or interests in, any open-end or closed-end management-type investment company or investment trust, such as those described in Section 27-105-33(e).
SECTION 25. Section 37-59-37, Mississippi Code of 1972, is brought forward as follows:
37-59-37. The school board of any school district shall have the power and authority to borrow money for the anticipated current year's expenses of such school district in anticipation of the collection of ad valorem taxes and other revenues of such school district for the then current fiscal year. The money so borrowed shall bear interest at a rate not greater than that allowed in Section 75-17-105 and shall be repaid within fourteen (14) months from the date of such borrowing out of the taxes and revenues in anticipation of which such money is borrowed. Such money shall be used for no other purpose than the payment of the current year's expenses of such school district. Pending the expenditure of funds borrowed under the provisions of this section, such funds may be invested in any manner in which any school district, municipality, county, state agency or other public body may invest surplus funds.
The amount borrowed under the provisions of this section shall in no event exceed the estimated amount of taxes and revenues collected or to be collected during the last preceding fiscal year, unless the tax levy for the current fiscal year has been made, then the amount borrowed under the provisions of this section shall in no event exceed the estimated amount of taxes and revenues collected or to be collected during the current fiscal year. Revenue anticipation notes issued under the provisions of this section shall be issued within the same fiscal year during which the tax levy is or will be made and other revenues received which it is anticipated will produce the funds from which the said notes will be repaid.
In borrowing money under the provisions of this section, it shall not be necessary to publish notice of intention so to do or to secure the consent of the qualified electors of such school district, either by election or otherwise. Such borrowing shall be authorized by order or resolution of the school board and may be evidenced by negotiable note or notes, signed and executed in such form as may be prescribed in such order or resolution. Such note or notes may be sold at a negotiated sale. Money may be borrowed in anticipation of ad valorem taxes and other revenues under the provisions of this section, regardless of whether or not such borrowing shall create an indebtedness in excess of statutory limitations.
Money may likewise be borrowed by any such school district, as herein provided, for the purpose of paying current interest maturities on any bonded indebtedness of such school district in anticipation of the collection of taxes for the retirement of such bonded indebtedness and the payment of any interest thereon.
SECTION 26. Section 37-59-43, Mississippi Code of 1972, is brought forward as follows:
37-59-43. (1) Whenever any school district or levying authority, as defined in Section 37-57-1(1)(b), acting on behalf of a school district, shall have on hand any bond and interest funds, any funds derived from the sale of bonds, or any other funds in excess of the sums which will be required for payment of current obligations and expenses as they come due, and which are not needed or cannot by law be used for the payment of the current obligations or expenses of the school district, the school board of the district shall have the power and authority to invest such excess funds in any bonds or other direct obligations of the United States of America or the State of Mississippi, or of any county or municipality of this state, which such county or municipal bonds have been approved by a reputable bond attorney or have been validated by a decree of the chancery court; or in interest-bearing time certificates of deposit or interest-bearing accounts with or through any financial institution approved for the deposit of state funds; and such institution shall be eligible to hold school district funds to the extent that it is qualified as a depository for state funds; or in any type of investment permitted by Sections 27-105-33(d) and 27-105-33(e). The rate of interest on such time certificates of deposit and interest-bearing accounts may be negotiated. The negotiated rate of interest shall be at the highest rate possible at the date of purchase or investment for such time certificates of deposit or interest-bearing accounts. In any event, the bonds or obligations in which such funds are invested shall mature or be redeemable prior to the time the funds so invested will be needed for expenditure. When bonds or other obligations have been so purchased, the same may be sold or surrendered for redemption at any time, except certificates of deposit which must mature, by order or resolution of such school board, and the president of the school board, when authorized by such order or resolution, shall have the power and authority to execute all instruments and take such other action as may be necessary to effectuate the sale or redemption thereof. In addition to the foregoing, any school board may invest any such funds in the same manner as provided for the investment of sixteenth section principal funds pursuant to Section 29-3-113.
(2) The provisions of subsection (1) of this section shall also apply to funds of community and junior college districts, and the governing authorities of such districts are vested with all power and authority with respect to such funds and matters herein mentioned as are vested in the other boards mentioned above with respect to such matters.
(3) All earnings from funds other than bond funds or bond sinking funds in excess of One Hundred Dollars ($100.00) in any fiscal year, invested according to the provisions of subsections (1) and (2) of this section shall be deposited in the district fund from which the investment was made, or the treasury of the junior college, as the case may be. Earnings from such school district funds which are less than One Hundred Dollars ($100.00) in any fiscal year may be deposited in the school district maintenance fund, or in the district fund from which the investment was made, in the discretion of the school board. Earnings from funds invested out of bond funds or bond sinking funds, together with the principal thereof, shall be deposited in the fund from which the investment was made.
(4) Nothing contained in this section shall be construed to prevent the payment of a portion of the earnings derived from the investment of bond proceeds or any other amounts in the bond fund or related reserve or sinking funds to the federal government to the extent required by the federal laws applicable to such bonds or the interest income thereon in order to maintain their tax exempt status.
SECTION 27. Section 51-29-91, Mississippi Code of 1972, is brought forward as follows:
51-29-91. To the payment of both principal and interest of the bonds and other negotiable evidences of debt to be issued under the provisions of this chapter, the entire revenues of the district from any and all sources and all real estate and railroads subject to taxation in the district are by this chapter pledged, in an amount not to exceed the amount of betterments assessed against said lands and railroads. The board of commissioners is hereby required to set aside annually from the first revenues collected from any source whatever a sufficient amount to secure and pay the interest on said bonds and evidences of indebtedness and a sinking fund for their ultimate retirement, if a sinking fund is provided for.
SECTION 28. Section 51-31-17, Mississippi Code of 1972, is brought forward as follows:
51-31-17. After the organization of a drainage district, the commissioners shall elect a secretary and treasurer, who may be a member of the board or may be any person qualified to fill the position. He shall give bond in such sum as the commissioners, with the approval of the chancellor, may determine and shall receive such compensation as the commissioners may allow, subject to approval by the chancellor. Such secretary and treasurer shall receive from the county tax collector, whose duty it shall be to collect, all monies levied by said drainage commissioners. The commissioners, with the approval of the chancellor, may designate the depository for such funds; such depository to be a qualified county depository; and upon their failure so to do, the funds shall be deposited as is now provided by law for funds belonging to the treasury of the county. The drainage commissioners of a district which has no bonds outstanding or which has a surplus fund in the treasury, by and with the approval of the chancellor, may place the surplus funds in a qualified county depository on savings account for six (6) months or more, at a rate of interest of not less than two percent (2%), or may loan said surplus funds on land in the county in which the district is organized, at a rate of interest of not less than six percent (6%) and on such terms and for such time as the chancellor may direct. Any such depository shall be eligible to hold funds of the district to the extent that it is qualified as a depository for county funds.
It shall be the duty of the treasurer to keep proper books to be furnished him by the commissioners, in which he shall keep an accurate account of all moneys received by him and of all disbursements of the same. He shall pay out no money except upon the order of a majority of the commissioners, shall carefully preserve on file all orders for the payment of money given him by the commissioners, and shall turn over all books, papers, vouchers, moneys and other property belonging to said district, in his hands as such treasurer, to his successor in office.
SECTION 29. Section 51-35-340, Mississippi Code of 1972, is brought forward as follows:
51-35-340. The board of directors of the district is hereby authorized and empowered, in its discretion, to borrow money from time to time, in an amount not to exceed Nine Hundred Thousand Dollars ($900,000.00) in the aggregate outstanding at any one (1) time, in order to defray expenses of the district for the purpose of acquiring, repairing, maintaining, strengthening and rebuilding dams, reservoirs, channels, levees, pumps and other flood control works and improvements for the district.
Before any money is borrowed under the provisions of this section, the board of directors shall adopt a resolution declaring the necessity for such borrowing and specifying the purpose for which the money borrowed is to be expended, the amount to be borrowed, the date or dates of the maturity thereof, and how such indebtedness is to be evidenced. The resolution shall be certified over the signature of the president of the board of directors.
The borrowing shall be evidenced by negotiable notes or certificates of indebtedness of the district which shall be signed by the president and secretary of the district. All such notes or certificates of indebtedness shall be offered at public sale by the district after not less than ten (10) days' advertising in a newspaper having general circulation within the district. Each sale shall be made to the bidder offering the lowest rate of interest or whose bid represents the lowest net cost to the district; however, the rate of interest shall not exceed ten percent (10%). No such notes or certificates of indebtedness shall be issued and sold for less than par and accrued interest. All notes or certificates of indebtedness shall mature in approximately equal installments of principal and interest over a period not to exceed fifteen (15) years from the dates of the issuance thereof. Principal shall be payable annually, and interest shall be payable annually or semiannually; provided, however, that the first payment of principal or interest may be for any period not exceeding one (1) year. Provided, however, if negotiable notes are outstanding from not more than one (1) previous issue authorized under the provisions of this section, then the schedule of payments for a new or supplementary issue may be so adjusted that the schedule of maturities of all notes or series of notes hereunder shall, when combined, mature in approximately equal installments of principal and interest over a period of fifteen (15) years from the date of the new or supplementary issue; or, if a lower interest rate will thereby be secured on notes previously issued and outstanding, a portion of the proceeds of any issue authorized hereunder may be used to refund the balance of the indebtedness previously issued under the authority of this section. Such notes or certificates of indebtedness shall be issued in such form and in such denominations as may be determined by the board of directors and may be made payable at the office of any bank or trust company selected by the board of directors. In such case, funds for the payment of principal and interest due thereon shall be provided in the same manner provided by law for the payment of the principal and interest due on bonds issued by the board of directors.
For the prompt payment of notes or certificates of indebtedness at maturity, both principal and interest, there is hereby pledged the avails of the ad valorem tax authorized in Section 51-35-333, Mississippi Code of 1972, and any other available funds of the district designated by the board of directors. Pledged funds shall be paid into a sinking fund and used exclusively for the payment of principal of and interest on the notes or certificates of indebtedness. Until needed for expenditure, monies in the sinking fund may be invested in the same manner as municipalities are authorized by law to invest surplus funds.
The proceeds of any notes or certificates of indebtedness issued under the provisions of this section shall be placed in a special fund and shall be expended only for the purpose or purposes for which they were issued as shown by the resolution authorizing the issuance thereof. If a balance shall remain of the proceeds of such notes or certificates of indebtedness after the purpose or purposes for which they were issued shall have been accomplished, such balance shall be used to pay such obligations at or before maturity and may be transferred to any sinking fund previously established for the payment thereof.
Proceeds from the sale of notes or certificates of indebtedness not immediately necessary for expenditure shall be invested in the same manner as surplus funds of municipalities may be invested.
SECTION 30. Section 57-61-37, Mississippi Code of 1972, is brought forward as follows:
57-61-37. (1) Each municipality is hereby authorized and empowered to borrow money from the board pursuant to the terms and provisions of this chapter. Each municipality is further authorized and empowered to pay to the board such fees and charges for services hereunder as the board may prescribe.
(2) Each municipality is hereby authorized to evidence the borrowing of money from the board pursuant to this chapter by the issuance of evidences of indebtedness under the provisions of this section and to sell such evidences of indebtedness to the board to raise money for any purpose or purposes for which the board is authorized to loan money to such municipality under the terms of this chapter. Except as specifically provided in this chapter, such evidences of indebtedness shall be issued in accordance with the provisions of Sections 21-33-307, 21-33-309, 21-33-311, 21-33-313, 21-33-315, 21-33-317, 21-33-319, 21-33-321 and 21-33-323 in the case of cities or incorporated towns, and in accordance with the provisions of Sections 19-9-7, 19-9-9, 19-9-11, 19-9-13, 19-9-15, 19-9-17, 19-9-19, 19-9-21, 19-9-23, 19-9-25 and 19-9-29 in the case of counties. Bonds or other evidences of indebtedness which are issued either pursuant to this chapter, or pursuant to any other law as evidence of loans made pursuant to this chapter, shall not be deemed indebtedness within the meaning specified in Section 21-33-303 with regard to cities or incorporated towns, and in Section 19-9-5 with regard to counties. The preceding sentence shall apply to all such bonds and evidences of indebtedness outstanding as of February 19, 1987, and to all such bonds and evidences of indebtedness hereafter issued.
(3) In connection with the issuance of evidences of indebtedness under the provisions of this chapter by cities, incorporated towns and counties, the following provisions shall specifically apply:
(a) When publishing notice of intent to issue bonds as required under the terms of Section 21-33-307 or Section 19-9-11, as the case may be, the municipality shall publish such notice once a week for three (3) consecutive weeks, the first publication to be not less than twenty-one (21) days prior to the date set for authorizing such issuance and the last publication to be not more than seven (7) days prior to such date.
(b) Such evidences of indebtedness shall be secured: (i) by the revenues derived by the municipality from the ownership, operation or lease of the project or improvements funded with proceeds of the loan from the board to such municipality under the terms of this chapter or by loan repayments from the private company derived by the municipality from the loan to the private company of the proceeds of the loan from the board to such municipality under the terms of this chapter, but only to the extent, in whole or in part, pledged by the municipality, which pledge may be on a basis subordinate to other obligations or agreements of the municipality; (ii) by the sources of repayment provided for under the terms of subsections (7) and (8) of Section 57-61-15 of this chapter; (iii) and as provided by Chapter 33, Title 21, Mississippi Code of 1972, in the case of cities and incorporated towns, and Chapter 9, Title 19, Mississippi Code of 1972, in the case of counties but only in the event that the sources provided by items (i) and (ii) hereof are insufficient therefor. For the purposes of Section 27-39-321, the evidences of indebtedness issued hereunder shall be deemed to be "general obligation bonds."
(c) Such evidences of indebtedness may be sold only to the board at private sale and may be sold at such price or prices, in such manner and at such times as may be agreed to by the municipality and the board, and the municipality may pay all expenses, premiums, fees and commissions which it may deem necessary and advantageous in connection with the issuance and sale thereof and such evidences of indebtedness shall mature at such time or times not exceeding thirty (30) years and in such amounts and shall bear interest at such rate or rates as required for loans made under the provisions of this chapter and as may be agreed upon by the board and the municipality; provided, that in connection with financing a Navy home port, the municipality may obtain a letter of credit and pledge to the repayment thereof the same sources pledged to such evidences of indebtedness or negotiate and enter into a credit agreement, trust indenture or other agreement with any bank, trust company or other lending institution for the purpose of making or receiving any payments required to be made to the United States Navy to accommodate a Navy home port.
(d) The proceeds of such evidences of indebtedness shall be applied to the following: (i) the purpose for which such evidences of indebtedness were issued; (ii) the payment of all costs of issuance of such evidences of indebtedness; (iii) the payment of any fees and charges established by the board; (iv) the payment of interest on such evidences of indebtedness for a period of time not greater than the period of time estimated to be required to complete the purpose for which the evidences of indebtedness were issued or to the extent provided by resolution of the municipality and approved by the board; (v) the payment of any costs relating to obtaining or entering into a credit agreement, loan disbursement agreement, trust indenture or other agreement with any bank, trust company or other lending institution for the purpose of securing, making or receiving any payments required to be made to the United States Navy to accommodate a Navy home port.
(e) Evidences of indebtedness issued under this section may be validated in the manner and with the force and effect provided in Section 31-13-1 et seq.
(f) This section shall be deemed to provide an additional, alternate and complete method for the doing of the things authorized hereby and shall be deemed and construed to be supplemental to any provisions of any other laws and not in derogation of any such provisions. In connection with the issuance of evidences of indebtedness, a municipality shall not be required to comply with the provisions of any other law except as provided herein.
SECTION 31. Section 65-19-47, Mississippi Code of 1972, is brought forward as follows:
65-19-47. The commissioners are hereby authorized to loan out any surplus funds of the district, and where such loans are secured by real estate, they shall be made in the manner and under the terms and provisions of the laws now relating to the loan of funds of the sixteenth sections; or they may purchase the bonds or evidences of debts of this state or of any county, municipality, drainage or road district situated in the State of Mississippi, or notes or bonds of the United States, or accept same as security for loans therein.
SECTION 32. Section 65-33-57, Mississippi Code of 1972, is brought forward as follows:
65-33-57. In any county wherein a seawall or road protection structure is maintained under the provisions of this chapter, which has invested surplus funds belonging to a road protection bond and interest sinking fund in the purchase of any notes, certificates of indebtedness, bonds, or other interest bearing obligations issued under the authority of Section 65-33-49, or refunding bonds issued or authorized to be issued in lieu thereof, and such notes, bonds, certificates of indebtedness, or refunding bonds are now held by such county for the use and benefit of such fund, and the board of supervisors of such county finds, by order spread upon its minutes, that the needs of such sinking fund demands it, or that it is to the best interest of the county to reduce such obligations so held to cash, such board of supervisors may authorize to be issued and issue and sell new road protection bonds in the aggregate amount of such notes, bonds, or certificates of indebtedness so held and authorized for the purpose of providing funds with which to take up, redeem, and cancel such obligations now held in such sinking fund. Upon the issuance of such road protection bonds, the said bonds, notes, certificates of indebtedness, and refunding bonds issued under authority of said section shall be cancelled.
SECTION 33. Section 83-43-23, Mississippi Code of 1972, is brought forward as follows:
83-43-23. Surplus funds, if any, of any such corporation may be invested and, if invested, shall be in compliance with the requirements of law for the investment of the surplus of life insurance companies.
SECTION 34. Section 91-13-8, Mississippi Code of 1972, is brought forward as follows:
91-13-8. All trustees, guardians, administrators, executors and other fiduciaries, whenever a governing instrument or order directs, requires, authorizes or permits investment in direct obligations of the United States of America, may invest in such obligations either directly or in the form of securities of, or other interests in, any open-end or closed-end management type investment company or investment trust registered under the provisions of 15 USC Section 80(a)-1 et seq., provided that the portfolio of such investment company or investment trust is limited to direct obligations of the United States of America and to repurchase agreements fully collateralized by direct obligations of the United States of America, and that such investment company or investment trust takes delivery of the collateral for any repurchase agreement, either directly or through an authorized custodian. This section shall not be construed to apply to the investment of any public funds; provided, however, that this section shall be construed to apply to the investment of public funds deposited with a bank trustee acting in a fiduciary capacity in connection with the sale and redemption of bonds, notes and other certificates of indebtedness, notwithstanding Section 31-19-5, Mississippi Code of 1972.
SECTION 35. Section 25-11-121, Mississippi Code of 1972, is brought forward as follows:
25-11-121. (1) The board shall, from time to time, determine the current requirements for benefit payments and administrative expense which shall be maintained as a cash working balance, except that such cash working balance shall not exceed at any time an amount necessary to meet the current obligations of the system for a period of ninety (90) days. Any amounts in excess of such cash working balance shall be invested, as follows:
(a) Funds may be deposited in any institution insured by the Federal Deposit Insurance Corporation that maintains a facility that takes deposits in the State of Mississippi or a custodial bank;
(b) Corporate bonds and taxable municipal bonds; or corporate short-term obligations of corporations or of wholly owned subsidiaries of corporations, whose short-term obligations are rated A-2 or better by Standard and Poor's, rated P-2 or better by Moody's Investment Service, F-2 or better by Fitch Ratings, Ltd., or the equivalent of these ratings if assigned by another United States Securities and Exchange Commission designated Nationally Recognized Statistical Rating Organization;
(c) Agency and nonagency residential and commercial mortgage-backed securities and collateralized mortgage obligations;
(d) Asset-backed securities;
(e) Bank loans;
(f) Convertible bonds;
(g) Bonds of the Tennessee Valley Authority;
(h) Bonds, notes, certificates and other valid obligations of the United States, and other valid obligations of any federal instrumentality that issues securities under authority of an act of Congress and are exempt from registration with the Securities and Exchange Commission;
(i) Bonds, notes, debentures and other securities issued by any federal instrumentality and fully guaranteed by the United States;
(j) Interest-bearing revenue bonds or notes or bonds or notes which are general obligations of any state in the United States or of any city or county therein;
(k) Bonds of established non-United States companies and foreign government securities. The board may take requisite action to effectuate or hedge transactions or invest in currency through foreign or domestic banks, including the purchase and sale, transfer, exchange, or otherwise disposal of, and generally deal in foreign exchange through the use of foreign currency, interbank forward contracts, futures contracts, options contracts, swaps and other related derivative instruments, notwithstanding any other provisions of this article to the contrary;
(l) Shares of stocks, common and/or preferred, of corporations created by or existing under the laws of the United States or any state, district or territory thereof and shares of stocks, common and/or preferred, and convertible securities of non-United States companies; provided:
(i) The maximum investments in stocks shall not exceed eighty percent (80%) of the total book value of the total investment fund of the system;
(ii) The stock of such corporation shall:
1. Be listed on a national stock exchange; or
2. Be traded in the over-the-counter market;
(iii) The outstanding shares of such corporation shall have a total market value of not less than Fifty Million Dollars ($50,000,000.00);
(iv) The amount of investment in any one (1) corporation shall not exceed three percent (3%) of the book value of the assets of the system;
(v) The shares of any one (1) corporation owned by the system shall not exceed five percent (5%) of that corporation's outstanding stock.
The board may take requisite action utilizing foreign currency as an investment vehicle, or to effectuate or hedge transactions for shares of stocks and convertible securities of non-United States companies through foreign or domestic banks, including the purchase and sale, transfer, exchange, or otherwise disposal of, and generally deal in foreign exchange through the use of foreign currency, interbank forward contracts, futures contracts, options contracts, swaps and other related derivative instruments, notwithstanding any other provisions of this article to the contrary;
(m) Covered call and put options on securities or indices traded on one or more of the regulated exchanges;
(n) Pooled or commingled funds managed by a corporate trustee or by a Securities and Exchange Commission registered investment advisory firm retained as an investment manager by the board of trustees, and shares of investment companies and unit investment trusts registered under the Investment Company Act of 1940, where such pooled or commingled funds or shares are comprised of common or preferred stocks, bonds, money market instruments or other investments authorized under this section. Such investment in commingled funds or shares shall be held in trust; provided that the total book value of investments under this paragraph shall at no time exceed five percent (5%) of the total book value of all investments of the system. Any investment manager approved by the board of trustees shall invest such commingled funds or shares as a fiduciary;
(o) Pooled or commingled real estate funds or real estate securities managed by a corporate trustee or by a Securities and Exchange Commission registered investment advisory firm retained as an investment manager by the board of trustees. Such investment in commingled funds or shares shall be held in trust; provided that the total book value of investments under this paragraph shall at no time exceed ten percent (10%) of the total book value of all investments of the system. Any investment manager approved by the board of trustees shall invest such commingled funds or shares as a fiduciary. The ten percent (10%) limitation in this paragraph shall not be subject to the five percent (5%) limitation in paragraph (n) of this subsection;
(p) Types of investments not specifically authorized by this subsection if the investments are in the form of a separate account managed by a Securities and Exchange Commission registered investment advisory firm retained as an investment manager by the board; or a limited partnership or commingled fund approved by the board; provided that the total book value of investments under this paragraph shall at no time exceed twenty percent (20%) of the total book value of all investments of the system. Any person or entity who exercises any discretionary authority or discretionary control respecting management of the separate account, limited partnership or commingled fund, or who exercises any authority or control respecting management or disposition of the assets of the separate account, limited partnership or commingled fund, shall exercise such authority or control as a fiduciary.
(2) All investments shall be acquired at prices not exceeding the prevailing market values for such investments.
(3) Any limitations herein set forth shall be applicable only at the time of purchase and shall not require the liquidation of any investment at any time. All investments shall be clearly marked to indicate ownership by the system and to the extent possible shall be registered in the name of the system.
(4) Subject to the above terms, conditions, limitations and restrictions, the board shall have power to sell, assign, transfer and dispose of any of the securities and investments of the system, provided that said sale, assignment or transfer has the majority approval of the entire board. The board may employ or contract with investment managers, evaluation services or other such services as determined by the board to be necessary for the effective and efficient operation of the system.
(5) Except as otherwise provided herein, no trustee and no employee of the board shall have any direct or indirect interest in the income, gains or profits of any investment made by the board, nor shall any such person receive any pay or emolument for his services in connection with any investment made by the board. No trustee or employee of the board shall become an endorser or surety, or in any manner an obligor for money loaned by or borrowed from the system.
(6) All interest derived from investments and any gains from the sale or exchange of investments shall be credited by the board to the account of the system.
(7) The board of trustees shall credit regular interest to the annuity savings account monthly. Regular interest shall mean such per centum rate to be compounded annually as set by the board of trustees through regulation.
(8) The board of trustees shall be the custodian of the funds of the system. All retirement allowance payrolls shall be certified by the executive director who shall furnish the board a surety bond in a company authorized to do business in Mississippi in such an amount as shall be required by the board, the premium to be paid by the board from the expense account.
(9) For the purpose of meeting disbursements for retirement allowances, annuities and other payments, cash may be kept available, not exceeding the requirements of the system for a period of ninety (90) days, on deposit in one or more banks or trust companies organized under the laws of the State of Mississippi or the laws of the United States, provided that the sum on deposit in any one (1) bank or trust company shall not exceed thirty-five percent (35%) of the paid-up capital and regular surplus of such bank or trust company.
(10) The board, the executive director and employees shall discharge their duties with respect to the investments of the system solely for the interest of the system with the care, skill, prudence and diligence under the circumstances then prevailing that a prudent investor acting in a like capacity and familiar with such matters would use in the conduct of an enterprise of a like character and with like aims, including diversifying the investments of the system so as to minimize the risk of large losses, unless under the circumstances it is clearly prudent not to do so.
(11) Documentary material or data made or received by the system which consists of trade secrets or commercial or financial information that relates to the investments of the system shall be exempt from the Mississippi Public Records Act of 1983 if the disclosure of the material or data is likely to impair the system's ability to obtain such information in the future, or is likely to cause substantial harm to the competitive position of the person or entity from whom the information was obtained.
SECTION 36. Section 25-11-407, Mississippi Code of 1972, is brought forward as follows:
25-11-407. The Board of Trustees of the Public Employees' Retirement System shall designate not less than three (3) nor more than five (5) companies to provide annuity contracts, mutual fund accounts or similar investment products, and the types of investment contracts or funds that may be offered by those companies. In making those designations, the board of trustees shall consider and be guided by:
(a) The nature and extent of the rights and benefits to be provided by those contracts or accounts, or both, for participants and their beneficiaries;
(b) The relation of those rights and benefits to the amount of contributions to be made;
(c) The suitability of those rights and benefits to the needs of the participants;
(d) The efficacy of the contracts or accounts, or both, in the recruitment and retention of faculty and administrators;
(e) The ability and experience of the designated companies in providing those suitable rights and benefits under those contracts or accounts, or both; and
(f) The ability and experience of the designated companies to provide both suitable participant investment guidance and investment options.
The companies shall act in a fiduciary capacity in selecting investment products that are suitable for the optional retirement program. It shall be the duty of the companies to report to and seek approval from the board for the investment products made available under this paragraph and to report the participant use of those options annually. The board reserves the right to refuse or discontinue any product offered by those companies.
SECTION 37. This act shall take effect and be in force from and after July 1, 2024.
