HCS HB 883 -- INVESTMENTS BY THE STATE TREASURER

This bill changes the laws regarding the State Treasurer's asset
allocation plan which limits the total amount of state moneys
that may be invested in any particular investment authorized by
Section 15, Article IV of the Missouri Constitution.  In its main
provisions, the bill:

(1)  Requires the plan to establish diversification limits
including a restriction limiting the total amount of time
deposits of state moneys, not including linked deposits, placed
with any one single banking institution to no greater than 10% of
all time deposits of state moneys;

(2)  Requires, beginning January 1, 2010, the rate of interest
payable by all banking institutions on time deposits, other than
linked deposits, to be the same as the average rate paid during
the week next preceding the week in which the deposit was made
for United States Treasury securities maturing and becoming
payable closest to the time of termination of the deposit on the
first $7 million of state moneys deposited.  The rate of interest
on any deposits in excess of the $7 million must be set at the
market rate as specified in Section 30.260.6, RSMo.  The $7
million amount will decrease by $2 million annually until January
1, 2013, then decrease by $1 million when it reaches zero
beginning January 1, 2014, and the rate of interest on all
deposits must be set at the market rate.  Currently, the rate of
interest must be the same as the average rate paid during the
week next preceding the week in which the deposit was made;

(3)  Allows bonds or other obligations of certain political
subdivisions to be acceptable securities for moneys deposited by
the State Treasurer in approved banks or financial institutions.
Currently, certain political subdivisions can only use bonds;

(4)  Prohibits United States Treasury securities and United
States federal agency debentures issued by Fannie Mae, Freddie
Mac, Federal Home Loan Bank, or Federal Farm Credit Bank valued
at market and deposited as collateral from exceeding 105% of the
aggregate amount of time deposits and demand deposits.  All other
securities, except as noted elsewhere in Section 30.270, cannot
exceed 115% of the aggregated amount of the time deposits and
demand deposits;

(5)  Adds eligible multitenant development enterprises,
alternative energy consumers, and governmental entities as
specified in Section 30.750 to those who may acquire a loan
through the Linked Deposit Program;

(6)  Expands the definition of "eligible job enhancement
business" as it relates to the program to include when the
applicant can demonstrate significant costs for equipment,
capital outlay, or capital improvements associated with the
physical expansion, renovation, or modernization of a facility or
equipment.  The maximum amount of the linked deposit cannot
exceed $50,000 per job created or retained plus the initial cost
of the physical expansion, renovation, or capital outlay; and

(7)  Increases the number of employees in the definition of
"eligible small business" as it relates to the program from less
than 25 to less than 100.

Missouri House of Representatives
95th General Assembly, 1st Regular Session
Last Updated November 17, 2009 at 9:25 am