By: Huffman S.B. No. 767
 
 
 
   
 
 
A BILL TO BE ENTITLED
 
AN ACT
  relating to investments made by the comptroller of public accounts
  with state funds not deposited in state depositories.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Section 404.024, Government Code, is amended by
  amending Subsections (b) and (c) and adding Subsections (c-1) and
  (c-2) to read as follows:
         (b)  Subject to Chapter 2270, state funds not deposited in
  state depositories shall be invested by the comptroller in:
               (1)  direct security repurchase agreements;
               (2)  reverse security repurchase agreements;
               (3)  direct obligations of or obligations the principal
  and interest of which are guaranteed by the United States;
               (4)  direct obligations of or obligations guaranteed by
  agencies or instrumentalities of the United States government;
               (5)  bankers' acceptances that:
                     (A)  are eligible for purchase by the Federal
  Reserve System;
                     (B)  do not exceed 270 days to maturity; and
                     (C)  are issued by a bank whose other comparable
  short-term obligations are rated in the highest short-term rating
  category, within which there may be subcategories or gradations
  indicating relative standing, including such subcategories or
  gradations as "rating category" or "rated," by a nationally
  recognized statistical rating organization, as defined by 15 U.S.C.
  Section 78c;
               (6)  commercial paper that:
                     (A)  does not exceed 365 [270] days to maturity;
  and
                     (B)  except as provided by Subsection (i), is
  issued by an entity whose other comparable short-term obligations
  are rated in the highest short-term rating category by a nationally
  recognized statistical rating organization;
               (7)  contracts written by the treasury in which the
  treasury grants the purchaser the right to purchase securities in
  the treasury's marketable securities portfolio at a specified price
  over a specified period and for which the treasury is paid a fee and
  specifically prohibits naked-option or uncovered option trading;
               (8)  direct obligations of or obligations guaranteed by
  the Inter-American Development Bank, the International Bank for
  Reconstruction and Development (the World Bank), the African
  Development Bank, the Asian Development Bank, and the International
  Finance Corporation that have received the highest long-term rating
  categories for debt obligations by a nationally recognized
  statistical rating organization;
               (9)  bonds issued, assumed, or guaranteed by the State
  of Israel;
               (10)  obligations of a state or an agency, county,
  city, or other political subdivision of a state;
               (11)  mutual funds secured by obligations that are
  described by Subdivisions (1) through (6) or by obligations
  consistent with Rule 2a-7 (17 C.F.R. Section 270.2a-7), promulgated
  by the Securities and Exchange Commission, including pooled funds:
                     (A)  established by the Texas Treasury
  Safekeeping Trust Company;
                     (B)  operated like a mutual fund; and
                     (C)  with portfolios consisting only of
  dollar-denominated securities;
               (12)  foreign currency for the sole purpose of
  facilitating investment by state agencies that have the authority
  to invest in foreign securities;
               (13)  asset-backed securities, as defined by the
  Securities and Exchange Commission in Rule 2a-7 (17 C.F.R. Section
  270.2a-7), that are rated at least A or its equivalent by a
  nationally recognized statistical rating organization and that
  have a weighted-average maturity of five years or less; and
               (14)  corporate debt obligations that are rated at
  least A or its equivalent by a nationally recognized statistical
  rating organization and mature in five years or less from the date
  on which the obligations were "acquired," as defined by the
  Securities and Exchange Commission in Rule 2a-7 (17 C.F.R. Section
  270.2a-7).
         (c)  Investments in direct security repurchase agreements
  and reverse security repurchase agreements may be:
               (1)  placed through [made with] state or national banks
  doing business in this state or with primary dealers as approved by
  the Federal Reserve System; or
               (2)  made directly with a state agency with the
  authority to invest in repurchase agreements.
         (c-1)  For purposes of Subsection (c), "state agency" means:
               (1)  an office, department, commission, board, or
  agency that is part of any branch of state government;
               (2)  an institution of higher education; or
               (3)  a nonprofit corporation acting on behalf of an
  entity described by Subdivision (1) or (2).
         (c-2)  Notwithstanding any other law, the term of any reverse
  security repurchase agreement made by the comptroller may not
  exceed 90 days after the date the reverse security repurchase
  agreement is delivered. Money received by the comptroller under
  the terms of a reverse security repurchase agreement may be used to
  acquire additional authorized investments, but the term of the
  authorized investments acquired must mature not later than the
  expiration date stated in the reverse security repurchase
  agreement.
         SECTION 2.  This Act takes effect September 1, 2021.