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| [ Introduced ] | [ Engrossed ] | [ House Amendment 001 ] |
92_HB3336sam001
LRB9207099BDdvam01
1 AMENDMENT TO HOUSE BILL 3336
2 AMENDMENT NO. . Amend House Bill 3336 by replacing
3 everything after the enacting clause with the following:
4 "Section 5. The Deposit of State Moneys Act is amended
5 by changing Sections 11 and 11.1 as follows:
6 (15 ILCS 520/11) (from Ch. 130, par. 30)
7 Sec. 11. Protection of public deposits; eligible
8 collateral.
9 (a) For deposits not insured by an agency of the federal
10 government, the State Treasurer, in his discretion, may
11 accept as collateral any of the following classes of
12 securities, provided there has been no default in the payment
13 of principal or interest thereon:
14 (1) Bonds, notes, or other securities constituting
15 direct and general obligations of the United States, the
16 bonds, notes, or other securities constituting the direct
17 and general obligation of any agency or instrumentality
18 of the United States, the interest and principal of which
19 is unconditionally guaranteed by the United States, and
20 bonds, notes, or other securities or evidence of
21 indebtedness constituting the obligation of a U.S. agency
22 or instrumentality.
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1 (2) Direct and general obligation bonds of the
2 State of Illinois or of any other state of the United
3 States.
4 (3) Revenue bonds of this State or any authority,
5 board, commission, or similar agency thereof.
6 (4) Direct and general obligation bonds of any
7 city, town, county, school district, or other taxing body
8 of any state, the debt service of which is payable from
9 general ad valorem taxes.
10 (5) Revenue bonds of any city, town, county, or
11 school district of the State of Illinois.
12 (6) Obligations issued, assumed, or guaranteed by
13 the International Finance Corporation, the principal of
14 which is not amortized during the life of the obligation,
15 but no such obligation shall be accepted at more than 90%
16 of its market value.
17 (7) Illinois Affordable Housing Program Trust Fund
18 Bonds or Notes as defined in and issued pursuant to the
19 Illinois Housing Development Act.
20 (8) Any securities or other eligible collateral
21 allowed under Section 1 of the Public Funds Deposit Act
22 (30 ILCS 225/1) or subsection (d) of Section 6 of the
23 Public Funds Investment Act (30 ILCS 235/6).
24 (b) The State Treasurer may establish a system to
25 aggregate permissible securities received as collateral from
26 financial institutions in a collateral pool to secure State
27 deposits of the institutions that have pledged securities to
28 the pool.
29 (c) The Treasurer may at any time declare any particular
30 security ineligible to qualify as collateral when, in the
31 Treasurer's judgment, it is deemed desirable to do so.
32 (d) Notwithstanding any other provision of this Section,
33 as security the State Treasurer may, in his discretion,
34 accept a bond, executed by a company authorized to transact
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1 the kinds of business described in clause (g) of Section 4 of
2 the Illinois Insurance Code, in an amount not less than the
3 amount of the deposits required by this Section to be
4 secured, payable to the State Treasurer for the benefit of
5 the People of the State of Illinois, in a form that is
6 acceptable to the State Treasurer.
7 (Source: P.A. 87-510; 87-575; 87-895; 88-93.)
8 (15 ILCS 520/11.1) (from Ch. 130, par. 30.1)
9 Sec. 11.1. The State Treasurer may, in his discretion,
10 accept as security for State deposits insured certificates of
11 deposit or share certificates issued to the depository
12 institution pledging them as security and may require
13 security in the amount of 125% of the value of the State
14 deposit. Such certificate of deposit or share certificate
15 shall:
16 (1) be fully insured by the Federal Deposit Insurance
17 Corporation, the Federal Savings and Loan Insurance
18 Corporation or the National Credit Union Share Insurance Fund
19 or issued by a depository institution which is rated within
20 the 3 highest classifications established by at least one of
21 the 2 standard rating services;
22 (2) be issued by a financial institution having assets
23 of $15,000,000 $30,000,000 or more; and
24 (3) be issued by either a savings and loan association
25 having a capital to asset ratio of at least 2%, by a bank
26 having a capital to asset ratio of at least 6% or by a credit
27 union having a capital to asset ratio of at least 4%.
28 The depository institution shall effect the assignment of
29 the certificate of deposit or share certificate to the State
30 Treasurer and shall agree, that in the event the issuer of
31 the certificate fails to maintain the capital to asset ratio
32 required by this Section, such certificate of deposit or
33 share certificate shall be replaced by additional suitable
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1 security.
2 (Source: P.A. 85-803.)
3 Section 10. The Public Funds Deposit Act is amended by
4 changing Section 1 as follows:
5 (30 ILCS 225/1) (from Ch. 102, par. 34)
6 Sec. 1. Deposits. Any treasurer or other custodian of
7 public funds may deposit such funds in a savings and loan
8 association, savings bank, or State or national bank in this
9 State. When such deposits become collected funds and are not
10 needed for immediate disbursement, they shall be invested
11 within 2 working days at prevailing rates or better. The
12 treasurer or other custodian of public funds may require such
13 bank, savings bank, or savings and loan association to
14 deposit with him or her securities guaranteed by agencies and
15 instrumentalities of the federal government equal in market
16 value to the amount by which the funds deposited exceed the
17 federally insured amount. Any treasurer or other custodian of
18 public funds may accept as security for public funds
19 deposited in such bank, savings bank, or savings and loan
20 association any class of securities or other eligible
21 collateral authorized by subsection (a), (b), or (c) of
22 Section 11 of the Deposit of State Moneys Act (15 ILCS
23 520/11), by Section 11.1 of the Deposit of State Moneys Act
24 (15 ILCS 520/11.1), or by subsection (d) of Section 6 of the
25 Public Funds Investment Act (30 ILCS 235/6). Such treasurer
26 or other custodian is authorized to enter into an agreement
27 with any such bank, savings bank, or savings and loan
28 association, with any federally insured financial institution
29 or trust company, or with any agency of the U.S. government
30 relating to the deposit of such securities. Any such
31 treasurer or other custodian shall be discharged from
32 responsibility for any funds for which securities are so
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1 deposited with him or her, and the funds for which securities
2 are so deposited shall not be subject to any otherwise
3 applicable limitation as to amount.
4 No bank, savings bank, or savings and loan association
5 shall receive public funds as permitted by this Section,
6 unless it has complied with the requirements established
7 pursuant to Section 6 of the Public Funds Investment Act.
8 (Source: P.A. 91-211, eff. 7-20-99.)
9 Section 15. The State Officers and Employees Money
10 Disposition Act is amended by changing Section 2c as follows:
11 (30 ILCS 230/2c) (from Ch. 127, par. 173a)
12 Sec. 2c. Every such officer, board, commission,
13 commissioner, department, institution, arm or agency is
14 authorized to demand and receive a bond and securities in
15 amount and kind satisfactory to him from any bank or savings
16 and loan association in which moneys held by such officer,
17 board, commission, commissioner, department, institution, arm
18 or agency for or on behalf of the State of Illinois, may be
19 on deposit, such securities to be held by the officer, board,
20 commission, commissioner, department, institution, arm or
21 agency for the period that such moneys are so on deposit and
22 then returned together with interest, dividends and other
23 accruals to the bank or savings and loan association. The
24 bond or undertaking and such securities shall be conditioned
25 for the return of the moneys deposited in conformity with the
26 terms of the deposit.
27 Whenever funds deposited with a bank or savings and loan
28 association exceed the amount of federal deposit insurance
29 coverage, a bond, or pledged securities, or other eligible
30 collateral shall be obtained. Only the types of securities or
31 other eligible collateral which the State Treasurer may, in
32 his or her discretion, accept for amounts not insured by the
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1 Federal Deposit Insurance Corporation or the Federal Savings
2 and Loan Insurance Corporation under Section 11 of "An Act in
3 relation to State moneys", approved June 28, 1919, as
4 amended, may be accepted as pledged securities. The market
5 value of the bond or pledged securities shall at all times be
6 equal to or greater than the uninsured portion of the deposit
7 unless the funds deposited are collateralized pursuant to a
8 system established by the State Treasurer to aggregate
9 permissible securities received as collateral from financial
10 institutions in a collateral pool to secure State deposits of
11 the institutions that have pledged securities to the pool.
12 All securities deposited by a bank or savings and loan
13 association under the provisions of this Section shall remain
14 the property of the depositary and may be stamped by the
15 depositary so as to indicate that such securities are
16 deposited as collateral. Should the bank or savings and loan
17 association fail or refuse to pay over the moneys, or any
18 part thereof, deposited with it, the officer, board,
19 commission, commissioner, department, institution, arm or
20 agency may sell such securities upon giving 5 days notice to
21 the depositary of his intention to so sell such securities.
22 Such sale shall transfer absolute ownership of the securities
23 so sold to the vendee thereof. The surplus, if any, over the
24 amount due to the State and the expenses of the sale shall be
25 paid to the bank or savings and loan association. Actions may
26 be brought in the name of the People of the State of Illinois
27 to enforce the claims of the State with respect to any
28 securities deposited by a bank or savings and loan
29 association.
30 No bank or savings and loan association shall receive
31 public funds as permitted by this Section, unless it has
32 complied with the requirements established pursuant to
33 Section 6 of "An Act relating to certain investments of
34 public funds by public agencies", approved July 23, 1943, as
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1 now or hereafter amended.
2 (Source: P.A. 85-257.)
3 Section 20. The Public Funds Investment Act is amended
4 by changing Section 6 as follows:
5 (30 ILCS 235/6) (from Ch. 85, par. 906)
6 Sec. 6. Report of financial institutions.
7 (a) No bank shall receive any public funds unless it has
8 furnished the corporate authorities of a public agency
9 submitting a deposit with copies of the last two sworn
10 statements of resources and liabilities which the bank is
11 required to furnish to the Commissioner of Banks and Real
12 Estate or to the Comptroller of the Currency. Each bank
13 designated as a depository for public funds shall, while
14 acting as such depository, furnish the corporate authorities
15 of a public agency with a copy of all statements of resources
16 and liabilities which it is required to furnish to the
17 Commissioner of Banks and Real Estate or to the Comptroller
18 of the Currency; provided, that if such funds or moneys are
19 deposited in a bank, the amount of all such deposits not
20 collateralized or insured by an agency of the federal
21 government shall not exceed 75% of the capital stock and
22 surplus of such bank, and the corporate authorities of a
23 public agency submitting a deposit shall not be discharged
24 from responsibility for any funds or moneys deposited in any
25 bank in excess of such limitation.
26 (b) No savings bank or savings and loan association
27 shall receive public funds unless it has furnished the
28 corporate authorities of a public agency submitting a deposit
29 with copies of the last 2 sworn statements of resources and
30 liabilities which the savings bank or savings and loan
31 association is required to furnish to the Commissioner of
32 Banks and Real Estate or the Federal Deposit Insurance
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1 Corporation. Each savings bank or savings and loan
2 association designated as a depository for public funds
3 shall, while acting as such depository, furnish the corporate
4 authorities of a public agency with a copy of all statements
5 of resources and liabilities which it is required to furnish
6 to the Commissioner of Banks and Real Estate or the Federal
7 Deposit Insurance Corporation; provided, that if such funds
8 or moneys are deposited in a savings bank or savings and loan
9 association, the amount of all such deposits not
10 collateralized or insured by an agency of the federal
11 government shall not exceed 75% of the net worth of such
12 savings bank or savings and loan association as defined by
13 the Federal Deposit Insurance Corporation, and the corporate
14 authorities of a public agency submitting a deposit shall not
15 be discharged from responsibility for any funds or moneys
16 deposited in any savings bank or savings and loan association
17 in excess of such limitation.
18 (c) No credit union shall receive public funds unless it
19 has furnished the corporate authorities of a public agency
20 submitting a share deposit with copies of the last two
21 reports of examination prepared by or submitted to the
22 Illinois Department of Financial Institutions or the National
23 Credit Union Administration. Each credit union designated as
24 a depository for public funds shall, while acting as such
25 depository, furnish the corporate authorities of a public
26 agency with a copy of all reports of examination prepared by
27 or furnished to the Illinois Department of Financial
28 Institutions or the National Credit Union Administration;
29 provided that if such funds or moneys are invested in a
30 credit union account, the amount of all such investments not
31 collateralized or insured by an agency of the federal
32 government or other approved share insurer shall not exceed
33 50% of the unimpaired capital and surplus of such credit
34 union, which shall include shares, reserves and undivided
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1 earnings and the corporate authorities of a public agency
2 making an investment shall not be discharged from
3 responsibility for any funds or moneys invested in a credit
4 union in excess of such limitation.
5 (d) Whenever a public agency deposits any public funds
6 in a financial institution, the public agency may enter into
7 an agreement with the financial institution requiring any
8 funds not insured by the Federal Deposit Insurance
9 Corporation or the National Credit Union Administration or
10 other approved share insurer to be collateralized by (i)
11 securities, (ii) mortgages, (iii) letters of credit issued by
12 a Federal Home Loan Bank, (iv) any class of securities or
13 other eligible collateral allowed by subsection (a), (b), or
14 (c) of Section 11 of the Deposit of State Moneys Act (15 ILCS
15 520/11), by Section 11.1 of the Deposit of State Moneys Act
16 (15 ILCS 520/11.1), or by Section 1 of the Public Funds
17 Deposit Act (30 ILCS 225/1), or (v) loans covered by a State
18 Guaranty under the Illinois Farm Development Act, in an
19 amount equal to at least market value of that amount of funds
20 deposited exceeding the insurance limitation provided by the
21 Federal Deposit Insurance Corporation or the National Credit
22 Union Administration or other approved share insurer.
23 (e) Paragraphs (a), (b), (c), and (d) of this Section do
24 not apply to the University of Illinois, Southern Illinois
25 University, Chicago State University, Eastern Illinois
26 University, Governors State University, Illinois State
27 University, Northeastern Illinois University, Northern
28 Illinois University, Western Illinois University, the
29 Cooperative Computer Center and public community colleges.
30 (Source: P.A. 91-324, eff. 1-1-00; 91-773, eff. 6-9-00.)
31 Section 99. Effective date. This Act takes effect upon
32 becoming law.".