Bill Text: MS SB2182 | 2013 | Regular Session | Introduced
Bill Title: Public funds depository; allow credit unions to qualify as.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Failed) 2013-02-05 - Died In Committee [SB2182 Detail]
Download: Mississippi-2013-SB2182-Introduced.html
MISSISSIPPI LEGISLATURE
2013 Regular Session
To: Business and Financial Institutions; Accountability, Efficiency, Transparency
By: Senator(s) Jackson (11th)
Senate Bill 2182
AN ACT TO AMEND SECTIONS 27-105-5, 27-105-6, 27-105-303, 27-105-305, 27-105-315, 27-105-353 AND 27-105-365, MISSISSIPPI CODE OF 1972, TO PROVIDE THAT FINANCIAL INSTITUTIONS MAINTAINING A DEPOSIT-TAKING FACILITY IN THIS STATE WHOSE ACCOUNTS ARE INSURED BY THE NATIONAL CREDIT UNION ADMINISTRATION MAY QUALIFY AS A PUBLIC FUNDS DEPOSITORY; AND FOR RELATED PURPOSES.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:
SECTION 1. Section 27-105-5, Mississippi Code of 1972, is amended as follows:
27-105-5. (1) Any
financial institution maintaining a deposit-taking facility in this state whose
accounts are insured by the National Credit Union Administration or the
Federal Deposit Insurance Corporation, or any successors * * * thereto,
may qualify as a public funds depository by submitting an application to the
State Treasurer as provided by Section 27-105-9, if the institution has a
primary capital to total assets ratio of five and one-half percent (5-1/2%) or
more. That ratio shall be determined not later than December 1 in each
calendar year by the State Treasurer on the basis of balance sheets of applying
institutions at June 30 of the same calendar year, and an institution shall not
be a qualified depository and shall not receive any public funds unless its
ratio has been certified annually by the Treasurer as meeting the prescribed
requirement. Each applicant shall furnish to the State Treasurer such
financial statements, balance sheets or other documentation, sworn to by a duly
elected officer, on such date or dates and on such forms as the State Treasurer
may require. Any knowing or willful misstatement of fact on those forms shall
subject the officer swearing to them to the penalty of perjury, and the
financial institution of which he is an officer shall not be eligible to serve
as a depository for a period of one (1) year beginning with the date on which
the State Treasurer certifies that such a misstatement has been made. When so
approved by the State Treasurer, the institution shall place on deposit with
the State Treasurer qualified bonds, notes and liquid securities in an
aggregate amount at least equal to one hundred five percent (105%) of the
average daily balance of funds on deposit in the aggregate by the State of
Mississippi or any agency or department of the state or by any county,
municipality or other governmental unit in excess of that portion of accounts
insured by the National Credit Union Administration or the Federal
Deposit Insurance Corporation, or any successor thereto.
(2) Any financial
institution maintaining a deposit-taking facility in this state whose accounts
are insured by the National Credit Union Administration or the Federal
Deposit Insurance Corporation, or any successors * * * thereto,
and which has been in existence for three (3) or more years may qualify as a
public funds depository and public funds guaranty pool member under Section 27-105-6
by submitting an application to the State Treasurer as provided by Section 27-105-9,
if the institution has a primary capital to total assets ratio of six and one-half
percent (6-1/2%) or more and otherwise meets the requirements of Section 27-105-6.
That ratio shall be determined not later than December 1 in each calendar year
by the State Treasurer on the basis of balance sheets of applying institutions
at June 30 of the same calendar year, and an institution shall not be a member
of the public funds guaranty pool unless its ratio has been certified annually
by the Treasurer as meeting the prescribed requirement. Each applicant shall
furnish to the State Treasurer such financial statements, balance sheets or
other documentation, sworn to by a duly elected officer, on such date or dates
and on such forms as the State Treasurer may require. Any knowing or willful
misstatement of fact on those forms shall subject the officer swearing to them
to the penalty of perjury and the financial institution of which he is an
officer shall not be eligible to serve as a depository for a period of one (1)
year beginning with the date on which the State Treasurer certifies that such a
misstatement has been made. When so approved by the State Treasurer, the
institution shall meet its security requirement of one hundred five percent (105%)
by placing on deposit with the State Treasurer qualified bonds, notes and
liquid securities in an aggregate amount at least equal to fifty-two and one-half
percent (52-1/2%) of the average daily balance of funds on deposit in the
aggregate by the State of Mississippi or any agency or department of the state
or by any county, municipality or other governmental unit in excess of that
portion of accounts insured by the National Credit Union Administration or
the Federal Deposit Insurance Corporation, or any successor thereto, and
executing a guarantee equal to the balance of fifty-two and one-half percent
(52-1/2%) of the average daily balance of funds on deposit in the aggregate by
the State of Mississippi or any agency or department of the state or by any
county, municipality or other governmental unit in excess of that portion of
accounts insured by the National Credit Union Administration or the
Federal Deposit Insurance Corporation, or any successor thereto.
(3) The term "qualified bonds, notes and liquid securities" as used in this section shall mean:
(a) All securities that are direct obligations of the United States Treasury or any other obligations fully guaranteed by the United States government.
(b) Bonds, notes and other obligations of the Federal Home Loan Bank, Federal National Mortgage Association, Federal Land Banks, Banks for Cooperatives, and Federal Intermediate Credit Banks, the Government National Mortgage Association, the Federal Housing Administration, the Farmers Home Administration, the Farm Credit System Financial Assistance Corporation, the United States Postal Service, the Federal Financing Bank, the Student Loan Marketing Association, the Small Business Administration, the General Services Administration, the Washington Metropolitan Area Transit Authority, the Maritime Administration, the Export-Import Bank, the International Bank for Reconstruction and Development, the Inter-American Development Bank, the Asian Development Bank, loan participations that carry the guarantee of the Commodity Credit Corporation, an instrumentality of the United States Department of Agriculture or other similar agencies approved by the State Treasurer.
(c) Obligations of the Tennessee Valley Authority.
(d) Legal obligation or revenue bonds of the State of Mississippi, its agencies, or any political subdivision of the state, or any municipality located in the State of Mississippi, or the Yazoo Mississippi Delta and the Mississippi Levee Districts, or the Mississippi Higher Education Assistance Corporation or its successors, or any body corporate and politic created under the laws of the State of Mississippi.
(e) General obligations issued by any state or by a county, parish or municipality of any state, the full faith and credit of which are pledged to the payment of principal and interest, that are rated "A" or better by any recognized national rating agency engaged in the business of rating bonds.
(f) Surety bonds of any surety company authorized to do business in the State of Mississippi.
(g) All bonds authorized as security for state funds under paragraphs (c), (d) and (e), inclusive, shall be investment quality, and any bonds under paragraphs (c), (d), (e) and (f), inclusive, which are rated substandard by any of the appropriate supervisory authorities having jurisdiction over the depository or by any recognized national rating agency engaged in the business of rating bonds, shall not be eligible for pledging as security to the State of Mississippi by any qualified state depository.
No bonds shall be accepted as security for more than their stated par value or market value, whichever is lower, except bonds and obligations of the State of Mississippi and Mississippi State Highway bonds or notes, which may be accepted as security at par value or market value, whichever is greater.
The bonds, notes and liquid securities to be placed on deposit shall secure both deposits and the accrued interest thereon.
Money shall be drawn from the depositories so as to leave in each as near as practicable, its equitable proportion of state funds.
The State Treasurer is authorized and empowered to:
(i) Deposit for safekeeping in the vaults of any of the state or national banks located within this state that are members of the National Credit Union Administration or the Federal Deposit Insurance Corporation and that have appropriate safekeeping facilities approved by the State Depository Commission, any federal reserve bank, any federal reserve branch bank, or any bank that is a member of the Federal Reserve System and is located in a city where there is a federal reserve bank or a federal reserve branch bank, the securities placed with him by financial institutions qualifying as state depositories; or
(ii) Accept, in lieu of the securities themselves, safekeeping trust receipts issued to the State Treasurer by the authorized safekeeping banks listed in subparagraph (i) above; the safekeeping trust receipts shall describe the securities and show that the securities are held for safekeeping for the account of the State Treasurer or other governmental unit. The securities so deposited shall not be commingled in any manner with the assets of the safekeeping bank.
The safekeeping banks listed in subparagraph (i) above are authorized to issue to the State Treasurer their safekeeping trust receipts based on safekeeping trust receipts issued to them by any of their correspondent banks that are members of the Federal Reserve System and are located in any federal reserve city and that have physical custody of the pledged securities.
In no event shall the State Treasurer deposit for safekeeping with any depository securities placed by the depository with the State Treasurer in qualifying as a public funds depository, nor shall he accept a safekeeping trust receipt by or from a depository covering securities it owns in order to secure state funds on deposit with it.
(4) In fulfilling the requirements of this Section 27-105-5, the State Treasurer shall:
(a) Maintain perpetual inventory of pledged collateral and perform monthly market valuations and quality ratings.
(b) Monitor and confirm, as often as deemed necessary by the Treasurer, the pledged collateral held by third-party custodians.
(c) Perfect an interest in pledged collateral by having pledged securities moved into an account established in the Treasurer's name. This action shall be taken at the discretion of the Treasurer.
(d) Review the reports of each qualified public funds depository for material changes in capital accounts or changes in name, address or type of institution, record the average daily balances of public deposits held; and monitor the collateral-pledging levels and required collateral based on the average daily balances.
(e) Compare public deposit information reported by qualified public funds depositories and public depositors. That comparison shall be conducted for qualified public depositories based on established financial condition criteria of record on September 30.
(f) Verify the reports of any qualified public funds depository relating to public deposits it holds when necessary to protect the integrity of the public deposits program.
(g) Confirm public deposits, to the extent possible under current law, when needed.
(h) Require at his or her discretion the filing of any information or forms required under this chapter to be by electronic data transmission. Those filings of information or forms shall have the same enforceability as a signed writing.
(5) A qualified public funds depository shall:
(a) Within fifteen (15) days after the end of each calendar month or when requested by the Treasurer, submit to the Treasurer a written report, under oath, indicating the average daily balance of all public deposits held by it during the reported month, required collateral, a detailed schedule of all securities pledged as collateral, selected financial information, and any other information that the Treasurer determines necessary to administer this chapter.
(b) Provide to each public depositor annually, not later than thirty (30) days following the public depositor's fiscal year end, the following information on all open accounts identified as a "public deposit" for that public depositor as of its fiscal year end, to be used for confirmation purposes: the federal employer identification number of the public funds depository, the name on the deposit account record, the federal employer identification number on the deposit account record, and the account number, account type and actual account balance on deposit. Any discrepancy found in the confirmation process shall be reconciled within sixty (60) days of the public depositor's fiscal year end.
(c) Submit to the Treasurer annually, not later than sixty (60) days of the public depositor's fiscal year end, a report of all public deposits held for the credit of all public depositors at the close of business on each public depositor's fiscal year end. The annual report shall consist of public deposit information in a report format prescribed by the Treasurer. The manner of required filing may be as a signed writing or electronic data transmission, at the discretion of the Treasurer.
(6) Public depositors shall comply with the following requirements:
(a) A public depositor shall ensure that the name of the public depositor and its tax identification number are on the account or certificate provided to the public depositor by the qualified public depository in a manner sufficient to disclose the identity of the public depositor;
(b) Not later than thirty (30) days following its fiscal year end, a public depositor shall notify the State Treasurer of its official name, address, federal tax identification number, and provide a listing of all accounts that it had with qualified public depositories, including the deposit balance in those accounts, as of its fiscal year end. A public entity established during the year shall furnish its official name, address and federal tax identification number to the State Treasurer before making any public deposit.
(7) Any information contained in a report of a qualified public funds depository required under Section 27-105-5 or 27-105-6 shall be considered confidential and exempt from disclosure and not subject to dissemination to anyone other than the State Treasurer and the State Auditor under the provisions of this chapter.
(8) The State Treasurer is empowered to assume responsibility as successor pledgee as agent on behalf of any county, municipality or other governmental unit of any and all collateral pledged before July 1, 2001, to that county, municipality or governmental unit by that public funds depository. Upon assuming responsibility as successor pledgee as provided in this subsection (8), the State Treasurer is empowered to sign such documents on behalf of any such county, municipality or governmental unit as may be required by a trustee custodian, including, but not limited to, any documentation necessary to change the pledgee from the county, municipality or governmental unit as pledgee to the State Treasurer as agent.
(9) As used in this section and Section 27-105-6, the following terms shall have the meanings set forth below:
(a) The term "primary capital" means the sum of common stockholders' equity capital, including common stock and related surplus, undivided profits, disclosed capital reserves that represent a segregation of undivided profits, and foreign currency translation adjustments, less net unrealized holding losses on profits, and foreign currency translation adjustments, less net unrealized holding losses on available-for-sale equity securities with readily determinable fair values; noncumulative perpetual preferred stock, including any related surplus; and minority interests in the equity capital accounts of consolidated subsidiaries; the allowance for loan and lease losses; cumulative perpetual preferred stock, long-term preferred stock (original maturity of at least twenty (20) years) and any related surplus; perpetual preferred stock (and any related surplus) where the dividend is reset periodically based, in whole or in part, on the bank's current credit standing, regardless of whether the dividends are cumulative or noncumulative; hybrid capital instruments, including mandatory convertible debt securities; term subordinated debt and intermediate-term preferred stock (original average maturity of five (5) years or more) and any related surplus; and net unrealized holding gains on equity securities.
(b) The term "assets classified loss" means:
(i) When measured as of the date of examination of the financial institution, those assets that have been determined by an evaluation made by a state or federal examiner as of that date to be a loss; and
(ii) When measured as of any other date, those assets:
(A) That have been determined: 1. by an evaluation made by a state or federal examiner at the most recent examination of the financial institution to be a loss, or 2. by evaluations made by the financial institution since its most recent examination to be a loss; and
(B) That have not been charged off from the financial institution's books or collected.
(c) The term "intangible assets" means those assets that would be required to be reported in the item for intangible assets in a Federal Deposit Insurance Corporation (FDIC) banking institution's "Reports of Condition and Income" (Call Reports), regardless of whether the institution is insured by the FDIC.
(d) The term "mandatory convertible debt" means a subordinated debt instrument meeting the requirements of the Federal Deposit Insurance Corporation that requires the issuer to convert the instrument into common or perpetual preferred stock by a date at or before the maturity of the debt instrument. The maturity of these instruments must be twelve (12) years or less.
(e) The term "mortgage servicing rights" means those assets (net of any related valuation allowances) that result from contracts to service loans secured by real estate (that have been securitized or are owned by others) for which the benefits of servicing are expected to more than adequately compensate the servicer for performing the servicing.
(f) The term "perpetual preferred stock" means a preferred stock that does not have a stated maturity date or that cannot be redeemed at the option of the holder and that has no other provisions that will require future redemption of the issue. It includes those issues of preferred stock that automatically convert into common stock at a stated date. It excludes those issues, the rate on which increases, or can increase, in such a manner that would effectively require the issuer to redeem the issue.
(g) The term "total assets" means the average of total assets of any financial institution that are or would be included in a Federal Deposit Insurance Corporation (FDIC) banking institution's "Reports of Condition and Income" (Call Reports), regardless of whether the institution is insured by the FDIC, plus the allowance for loan and lease losses, minus assets classified loss and minus intangible assets other than mortgage servicing rights.
(h) The term "average daily balance" means the average daily balance of public deposits of each governmental unit held during the reported month. The average daily balances must be determined by totaling, by account, the daily balance held by the depositor and then dividing the total by the number of calendar days in the month. Deposit insurance is then deducted from each public depositor's balance and the resulting amounts are totaled to obtain the average daily balance.
(i) The term "public funds" means funds in which the entire beneficial interest is owned by a governmental unit or funds held in the name of a public official of a governmental unit charged with the duty to receive or administer funds and acting in such official capacity.
(j) The term "governmental unit" means the State of Mississippi, and any office, department, agency, division, bureau, commission, board, institution, hospital, college, university, airport authority or other instrumentality thereof, whether or not such body or instrumentality has the authority to levy taxes or to sue or be sued in its own name. Further, it shall mean any body politic or body corporate other than the state responsible for governmental activities only in geographic areas smaller than that of the state, including, but not limited to any county, municipality, school district, community hospital as defined in Section 41-13-10, airport authority or other instrumentality thereof, whether or not such body or instrumentality has the authority to levy taxes or to sue or be sued in its own name. It is the intent to include all state and political subdivisions or instrumentalities thereof whether specifically recited herein or not.
SECTION 2. Section 27-105-6, Mississippi Code of 1972, is amended as follows:
27-105-6. (1) There is established within the State Treasury a public funds guaranty pool to consist of qualified public funds depositories commissioned under Section 27-105-5(2) to be administered by a Guaranty Pool Board and the State Treasurer.
(2) There is established a nine-member Guaranty Pool Board to administer the guaranty pool and to review and recommend criteria to be used by the State Treasurer in order to protect public deposits and the depositories in the program.
(3) Any financial institution qualifying as a guaranty pool member shall guarantee public fund deposits against loss caused by the default or insolvency of other guaranty pool members and shall execute under oath an agreement of contingent liability in addition to a public deposit pledge agreement.
(4) In addition to maintaining the capital requirements of Section 27-105-5, a guaranty pool member shall meet and maintain, on a quarterly basis, at least two (2) of the following ratios:
(a) A ratio of loans past due ninety (90) days or more to total loans of less than two percent (2%);
(b) An annualized return on average assets of more than seventy-five one hundredths of one percent (0.75%); and
(c) A total loans to total assets ratio not exceeding eighty percent (80%).
Failure of a guaranty pool member to meet the capital ratio and at least two (2) of the above three (3) ratios shall subject the member to subsection (9) of this section.
(5) In fulfilling the requirements of this section, the Treasurer has the power to:
(a) Order discontinuance of participation in the guaranty pool program by a qualified public depository upon failure of the financial institution to meet the above requirements of subsection (4) of this section;
(b) Appoint a nine-member Guaranty Pool Board;
(c) Establish goals and objectives and provide other data as may be necessary to assist the Guaranty Pool Board established under subsection (2) in developing standards for the program;
(d) Perform financial analysis of any qualified public funds depository as needed.
(6) The Guaranty Pool Board shall consist of:
(a) One (1) representative of financial institutions with assets of One Billion Dollars ($1,000,000,000.00) or more chosen by the State Treasurer from a list of two (2) bankers nominated by the Mississippi Bankers Association;
(b) One (1) representative of financial institutions with assets of Three Hundred Million Dollars ($300,000,000.00) but less than One Billion Dollars ($1,000,000,000.00) chosen by the State Treasurer from a list of two (2) bankers nominated by the Mississippi Bankers Association;
(c) One (1) representative of financial institutions with assets of less than Three Hundred Million Dollars ($300,000,000.00) chosen by the State Treasurer from a list of two (2) bankers nominated by the Mississippi Bankers Association;
(d) Two (2) representatives of banks at large chosen by the State Treasurer from a list of four (4) bankers nominated by the Mississippi Bankers Association;
(e) One (1) member chosen by the State Treasurer from a list of two (2) supervisors nominated by the Mississippi Supervisors Association;
(f) One (1) member chosen by the State Treasurer from a list of two (2) municipal officials nominated by the Mississippi Municipal League; and
(g) The Commissioner of Banking and Consumer Finance and the State Treasurer.
The Guaranty Pool Board shall determine the effective date of the public funds guaranty pool, which date shall be no earlier than July 1, 2001, and so notify the State Treasurer. All nominees of the Mississippi Bankers Association shall be employed by a financial institution that is a member of the public funds guaranty pool.
Initially, three (3) of the five (5) representatives of financial institutions shall be appointed for a term of one (1) year. The remaining members other than the Commissioner of Banking and Consumer Finance and State Treasurer, who shall be permanent members, shall be appointed for a term of two (2) years. Upon expiration of these terms, members shall be appointed thereafter for two-year terms. Any member is eligible for reappointment and shall serve until a successor qualifies. If a vacancy occurs in the position of any appointed member, a new member shall be appointed in the same manner as the member's predecessor for the remainder of the unexpired term. A member of the board shall receive no compensation for service on the board.
The Guaranty Pool Board shall elect a chair and vice chair and shall also designate a secretary who need not be a member of the Guaranty Pool Board. The secretary shall keep a record of the proceedings of the Guaranty Pool Board and shall be the custodian of all printed materials filed with or by the advisory committee. Notwithstanding the existence of vacancies on the Guaranty Pool Board, a majority of the members constitutes a quorum. The Guaranty Pool Board shall not take official action in the absence of a quorum.
In addition to the requirements of subsection (4) of this section, the Guaranty Pool Board, by a two-thirds (2/3) supermajority vote of the entire Guaranty Pool Board, may establish additional criteria for qualification as a guaranty pool member, including promulgating additional ratios, requiring stricter ratios than provided under subsection (4), or requiring additional collateral; however, any additional criteria shall be uniformly applied to all participants, although higher collateral pledge levels may be based on different financial criteria. Any reduction in previously approved criteria shall likewise be subject to a two-thirds (2/3) supermajority vote of the entire Guaranty Pool Board. Any additional criteria will become effective at the quarter next after the Guaranty Pool Board votes. The Guaranty Pool Board is authorized to promulgate regulations in order to more fully carry out its obligations under this paragraph.
(7) A public funds guaranty pool member shall submit to the State Treasurer not later than the date required to be filed with its primary federal regulatory agency:
(a) A copy of the quarterly Consolidated Reports of Condition and Income, and any amended reports, required by the Federal Deposit Insurance Act, 12 USCS Section 1811 et seq., if the depository is a bank; or
(b) A copy of the Thrift Financial Report, and any amended reports, required to be filed with the Office of Thrift Supervision if the depository is a savings and loan association.
(8) A public funds guaranty pool member may effect a voluntary withdrawal from the guaranty pool by giving written notice to the State Treasurer. Notice of withdrawal shall be mailed or delivered in sufficient time to be received by the State Treasurer at least one hundred eighty (180) days before the effective date of withdrawal. On the effective date of withdrawal, the guaranty pool member shall pledge and place on deposit with the State Treasurer securities equal to one hundred five percent (105%) of the outstanding balances of public funds held less the amount of funds insured by the National Credit Union Administration or the Federal Deposit Insurance Corporation.
The contingent liability for any loss before the effective date of withdrawal of the depository withdrawing from the guaranty pool shall continue after the effective date of the withdrawal for a period of six (6) months.
(9) A public funds guaranty pool member failing to meet the requirements for membership in subsection (4) of this section or as modified by the Guaranty Pool Board under its authority at subsection (6) is required to withdraw from the guaranty pool. The State Treasurer shall notify the public funds guaranty pool member of the effective date of the withdrawal not less than thirty (30) days before that effective date. Not later than the effective date of withdrawal, the withdrawing pool member must pledge and place on deposit with the State Treasurer securities equal to one hundred five percent (105%) of the outstanding balances of public funds held less the amount of funds insured by the National Credit Union Administration or the Federal Deposit Insurance Corporation, or pay over those funds to the public depositor.
The contingent liability for any loss before the effective date of withdrawal of the depository withdrawing from the guaranty pool shall continue for a period of one (1) year after the effective date of the withdrawal.
SECTION 3. Section 27-105-303, Mississippi Code of 1972, is amended as follows:
27-105-303. The amount of money belonging to the several funds in the county treasury of each county in the state which is required to meet the current needs and demands of no more than seven (7) business days shall be kept on deposit in or through qualified financial institutions whose accounts are insured by the National Credit Union Administration, the Federal Deposit Insurance Corporation, or the Federal Savings and Loan Insurance Corporation, or in or through some of them doing business in the several counties, provided that where there is no such financial institution in a county qualifying as a depository, some such financial institution in an adjoining county may qualify as a depository. All such deposits shall be subject to payment when demanded on warrant issued by the clerk of the board of supervisors on the order of the said board or on the allowance of a court authorized to allow the same. Each financial institution qualifying as such county depository shall not be required to pay interest to the county for the privilege of holding the deposits unless federal law permits the payment of interest on such deposits, in which case the maximum permitted interest rate shall be paid on such deposits. Where more than one (1) financial institution in a county offers to qualify as a depository, the board of supervisors may allocate such money to each qualified financial institution as nearly as practicable in proportion to their respective net worth, and may adopt the rules for receiving such deposits.
SECTION 4. Section 27-105-305, Mississippi Code of 1972, is amended as follows:
27-105-305. The board of supervisors
at the regular December 1997 meeting, and annually thereafter or, in the
discretion of the board of supervisors, every two (2) years thereafter, shall
give notice to all financial institutions in its county whose accounts are
insured by the National Credit Union Administration or the Federal
Deposit Insurance Corporation * * *, or any successor thereto * * *, by publication, that bids will be received
from financial institutions at the following January meeting, or some
subsequent meeting, for the privilege of keeping the county funds, or any part
thereof, which notice shall refer by name to this article and it shall not be
necessary to incorporate in the notice the provisions of this article; and at
the January meeting, or a subsequent meeting as may be designated in the
notice, as the case may be, the board of supervisors shall receive such bids or
proposals as the financial institutions may make for the privilege of keeping
the county funds, or any part thereof. The bids or proposals shall designate
the kind of security as authorized by law which the financial institutions
propose to give as security for funds, and the board shall cause the county
funds and all other funds in the hands of the county treasurer to be deposited
in the qualified financial institution or qualified institutions proposing the
best terms and meeting the requirements provided in Section 27-105-315, having
in view the safety of such funds. However, if a bank submits a bid or offer to
the board of supervisors to act as a depository for the county and the bid or
offer, if accepted, would result in a contract in which a member of the board
of supervisors would have a direct or indirect interest, the board of
supervisors may elect to not open or consider any bids received and submit the
matter to the State Treasurer. Upon receipt of the bids received from the
board of supervisors, the State * * * Treasurer shall open and
consider the bids received, select a depository or depositories, make all
decisions and take any action within the authority of the board of supervisors
under this section relating to the selection of a depository or depositories,
including:
(a) The selecting and opening of accounts;
(b) Approval of securities;
(c) The transfer and deposit of funds between depositories; and
(d) All other related functions.
If the board of supervisors elects to open and consider the bids or offers, it shall not open or consider any bid which, if accepted, would result in a contract in which a member of the board of supervisors would have a direct or indirect interest.
SECTION 5. Section 27-105-315, Mississippi Code of 1972, is amended as follows:
27-105-315. (1) Any
financial institution in a county, or in an adjoining county where there is no
financial institution in the county qualifying, whose accounts are insured by
the National Credit Union Administration or the Federal Deposit
Insurance Corporation, or any successors * * * thereto,
may qualify as a county depository, if the institution qualifies as a public
funds depository under Section 27-105-5 or a public funds guaranty pool member
under Sections 27-105-5 and 27-105-6. The qualified financial institution
shall secure those deposits by placing qualified securities on deposit with the
State Treasurer as provided in Section 27-105-5.
(2) Notwithstanding the
foregoing, any financial institution whether or not meeting the prescribed
ratio requirement whose accounts are insured by the National Credit Union
Administration or the Federal Deposit Insurance Corporation, or any
successors * * * thereto, may receive county funds in an
amount not exceeding the amount that is insured by that insurance corporation
and may qualify as a county depository to the extent of that insurance.
(3) For purposes of the foregoing subsection (2), a deposit or investment shall be within the amount that is insured by that insurance corporation if the deposit or investment is made on the following conditions:
(a) The financial institution arranges for the investment of the funds in interest-bearing accounts in one or more banks or savings and loan associations wherever located in the United States, for the account of the public depositor;
(b) The full amount of the principal and accrued interest of each such interest-bearing account is insured by the National Credit Union Administration or the Federal Deposit Insurance Corporation;
(c) The financial institution acts as custodian for the public depositor with respect to the funds invested in the public depositor's account; and
(d) At the same time that such interest-bearing accounts are invested, the financial institution receives an amount of deposits from customers of other financial institutions located in the United States equal to or greater than the amount of the funds invested by the public depositor through the financial institution.
SECTION 6. Section 27-105-353, Mississippi Code of 1972, is amended as follows:
27-105-353. The board of
mayor and aldermen or other municipal authorities of each and every city, town
or village in the state are required to select a depository in the manner
provided by law for the selection of county depositories. Before being
selected, a depository must be certified by the State Treasurer as meeting the
capital ratio requirement specified in Section 27-105-5 or 27-105-6. An
institution shall not be a qualified depository and shall not receive any
municipal funds unless its ratio has been certified annually by the State
Treasurer as meeting the prescribed requirement. Notwithstanding the
foregoing, any financial institution whether or not meeting the prescribed
ratio requirement whose accounts are insured by the National Credit Union
Administration or the Federal Deposit Insurance Corporation, or any
successors * * * thereto, may receive municipal funds in
an amount not exceeding the amount that is insured by that insurance
corporation and may qualify as a municipal depository to the extent of that
insurance as prescribed in Section 27-105-315.
SECTION 7. Section 27-105-365, Mississippi Code of 1972, is amended 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 National Credit Union Administration or 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 National Credit Union Administration or 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 National Credit Union Administration or 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 National Credit Union Administration or 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 8. This act shall take effect and be in force from and after July 1, 2013.
