KS
Kansas Senate Bill SB115

Kansas 2025-2026 Regular Session

Kansas Senate Bill SB115 Compare Versions

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11 Session of 2025
22 SENATE BILL No. 115
33 By Committee on Federal and State Affairs
44 1-30
55 AN ACT concerning precious metals; relating to gold and silver bullion
66 and specie; enacting the Kansas bullion depository act; authorizing the
77 state treasurer to establish, administer or contract for the administration
88 of bullion depositories; allowing state moneys to be deposited in such
99 bullion depositories and invested in specie legal tender; amending
1010 K.S.A. 2024 Supp. 75-4209 and repealing the existing section.
1111 Be it enacted by the Legislature of the State of Kansas:
1212 New Section 1. The provisions of sections 1 through 10, and
1313 amendments thereto, shall be known and may be cited as the Kansas
1414 bullion depository act.
1515 New Sec. 2. As used in the Kansas bullion depository act:
1616 (a) "Act" means the Kansas bullion depository act.
1717 (b) "Administrator" means the individual or entity appointed by the
1818 state treasurer to oversee the operation and management of the
1919 depositories.
2020 (c) "Bullion" means refined gold or silver in any shape or form with
2121 uniform content and purity, including, but not limited to, coins, rounds,
2222 bars, ingots or any other product that is:
2323 (1) Stamped or imprinted with the weight and purity of the gold or
2424 silver that it contains; and
2525 (2) valued primarily based on its metal content and not on its form
2626 and function.
2727 (d) "Depository" means a bullion depository established by section 9,
2828 and amendments thereto, or established by and located in another
2929 jurisdiction and designated as a depository by the state treasurer pursuant
3030 to section 3, and amendments thereto.
3131 (e) "Depository account" means an account established with a
3232 depository to facilitate the storage, transfer and exchange of bullion.
3333 (f) "Electronic currency" means a representation of actual precious
3434 metals, specie or bullion held in a depository account that may be
3535 transferred by electronic instruction. Such representation shall reflect the
3636 exact units of physical precious metals, specie or bullion in such
3737 depository account in its fractional troy ounce measurement as provided in
3838 this act.
3939 (g) "Precious metal" means gold or silver.
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7676 (h) "Specie" means bullion fabricated into products of uniform shape,
7777 size, design, content, weight and purity that is suitable for or customarily
7878 used as currency, as a medium of exchange or as the medium for purchase,
7979 sale, storage, transfer or delivery of precious metals in retail or wholesale
8080 transactions.
8181 (i) "Specie legal tender" means gold or silver coin or bullion,
8282 including, but not limited to, gold or silver coin issued by the United
8383 States.
8484 New Sec. 3. (a) The state treasurer may:
8585 (1) Establish and administer bullion depositories to provide a secure
8686 location for the storage of bullion;
8787 (2) contract with a third party to act as the administrator to manage
8888 the day-to-day operations of bullion depositories located in this state and
8989 implement the depositories' security, storage and transactional and
9090 administrative procedures in accordance with this act; or
9191 (3) contract with one or more bullion depositories established and
9292 located in another jurisdiction for the secure storage and administration of
9393 bullion deposits made in accordance with this act.
9494 (b) If the state treasurer enters into a contract pursuant to subsection
9595 (a)(3), the state treasurer shall designate the bullion depository named in
9696 such contract as an official state bullion depository.
9797 (c) As used in this section, "security" means physical, online and
9898 logical security standards that meet generally accepted standards within
9999 the information assurance industry.
100100 New Sec. 4. (a) A person, an individual, a corporation, a partnership,
101101 a company, an association, a trust, an estate and a governmental entity,
102102 may establish a depository account by entering into a depository
103103 agreement with a depository.
104104 (b) A depository account holder may purchase, sell, deposit or
105105 withdraw bullion through the holder's account in accordance with this
106106 section and any rules and regulations adopted thereunder. A depository
107107 shall have processes and systems to facilitate timely bullion purchases,
108108 sales, deposits and withdrawals, including, but not limited to:
109109 (1) Physical deposits and withdrawals to and from the depository's
110110 physical location, or a partner organization such as a major mint or refiner
111111 capable of providing bullion that meets standards established by the state
112112 treasurer; and
113113 (2) electronic systems that meet current industry standards for the
114114 purchase and sale of bullion for depository account holders that cannot or
115115 choose not to travel to the physical location.
116116 (c) State agencies, counties, municipalities and other governmental
117117 entities may use a depository for storing bullion. The state treasurer may
118118 deposit a portion of state moneys into a depository in the form of bullion
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162162 and such bullion shall be considered part of the state's official financial
163163 reserves. The state treasurer shall develop guidelines for the state's use of
164164 depositories. All deposits of state moneys into a depository shall be
165165 secured by a pledge of securities as provided in K.S.A. 75-4218, and
166166 amendments thereto.
167167 (d) The administrator shall maintain a record of all depository
168168 accounts and all transactions, deposits and withdrawals associated with
169169 each account. Such records shall be provided to the state treasurer within
170170 five business days after the state treasurer's request. All records shall be
171171 kept and maintained, at a minimum, on an approved state computer system
172172 for a period of at least seven years.
173173 New Sec. 5. (a) The administrator shall ensure that a depository has
174174 state-of-the-art security measures to prevent theft, fraud or other
175175 unauthorized access or removal of bullion.
176176 (b) A depository shall maintain insurance coverage sufficient to cover
177177 the full value of all bullion stored at the depository. Such insurance shall
178178 be provided by an insurer that is rated "A" or higher by am best company
179179 or an equivalent rating by another national rating service acceptable to the
180180 administrator.
181181 (c) An independent third party shall conduct audits at least twice a
182182 year to verify the amount and value of bullion stored in a depository and to
183183 inspect the security measures and protocols in place. Such independent
184184 third party shall be an established provider with a good history of
185185 providing such auditing service. Documentation of audit results shall be
186186 made available within a reasonable timeframe to the public upon request.
187187 Documentation shall include, at a minimum, summary totals of precious
188188 metal amounts assessed, as well as documentation of any discrepancies
189189 found during the audit.
190190 (d) A depository shall comply all with federal and state laws
191191 pertaining to bullion storage, management and transactions. The
192192 administrator shall consult regularly with legal counsel to ensure that each
193193 depository remains compliant with evolving laws and regulations.
194194 New Sec. 6. (a) An employee or official associated with the oversight
195195 or operation of a depository shall:
196196 (1) Have no financial interests in companies or entities that produce,
197197 sell or manage bullion; and
198198 (2) disclose any potential conflict of interest to the state treasurer
199199 immediately upon discovery.
200200 (b) A violation of this section may result in the employee's or
201201 official's removal from position, fines or other legal penalties as
202202 determined by the state treasurer.
203203 New Sec. 7. The state treasurer shall have all authority necessary to
204204 enter into contractual agreements with third parties to administer this act.
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248248 The administrator may enter into contractual agreements with private
249249 entities for the provision of services for bullion storage, transportation or
250250 security. All contractual agreements shall be reviewed and approved by the
251251 state treasurer to ensure that such agreements align with the state's interests
252252 and security requirements.
253253 New Sec. 8. (a) A depository shall not be terminated or transferred to
254254 a private entity unless such termination or transfer is approved by an act of
255255 the legislature. A depository termination or transfer shall ensure the
256256 security of the bullion, the rights of account holders and the financial
257257 interests of the state.
258258 (b) The administrator shall provide a quarterly report to the state
259259 treasurer detailing the operations, transactions and financial status of each
260260 depository.
261261 (c) The state treasurer shall provide an annual report to the legislature
262262 on or before the first day of the regular session of the legislature regarding
263263 the operations and financial status of each depository.
264264 New Sec. 9. The state treasurer shall adopt rules and regulations
265265 necessary to administer the provisions of this act, including, but not
266266 limited to, rules and regulations for the establishment, operation, security
267267 and administration of a depository.
268268 New Sec. 10. (a) A purported confiscation, requisition, seizure or
269269 other attempt to control the ownership, disposition or proceeds of a
270270 withdrawal, transfer, liquidation or settlement of a depository account or
271271 an electronic currency account, including the precious metals represented
272272 by the balance of a depository account or an electronic currency account, if
273273 effected by a governmental or quasi-governmental authority other than an
274274 authority of this state or by a financial institution or other person acting on
275275 behalf of or pursuant to a directive or authorization issued by a
276276 governmental or quasi-governmental authority other than an authority of
277277 this state, in the course of a generalized declaration of illegality or
278278 emergency relating to the ownership, possession or disposition of one or
279279 more precious metals, contracts or other rights to the precious metals,
280280 contracts or derivatives of the ownership, possession, disposition, contracts
281281 or other rights, is hereby declared to be null and void and shall have no
282282 force or effect.
283283 (b) A depository in the case of receiving notice of a purported
284284 confiscation, requisition, seizure or other attempt to control the ownership,
285285 disposition or proceeds of a withdrawal, transfer, liquidation or settlement
286286 of a depository account or an electronic currency account, including the
287287 precious metals represented by the balance of a depository account or an
288288 electronic currency account, if effected by a governmental or quasi-
289289 governmental authority other than an authority of this state or by a
290290 financial institution or other person acting on behalf of or pursuant to a
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334334 directive or authorization issued by a governmental or quasi-governmental
335335 authority other than an authority of this state, in the course of a generalized
336336 declaration of illegality or emergency relating to the ownership, possession
337337 or disposition of one or more precious metals, contracts or other rights to
338338 the precious metals, contracts or derivatives of the ownership, possession,
339339 disposition, contracts or other rights, shall not recognize the governmental
340340 or quasi-governmental authority, financial institution or other person
341341 acting as the lawful successor of the registered holder of the depository
342342 account or the electronic currency account in question.
343343 (c) Upon receipt of notice of any transaction described in subsection
344344 (a), with respect to all or any portion of the balance of a depository
345345 account or an electronic currency account, a depository shall suspend
346346 withdrawal privileges associated with the balances of the depository
347347 account or electronic currency account until suitable substitute
348348 arrangements may be effected in accordance with rules and regulations of
349349 the state treasurer to enable the registered account holder to take delivery
350350 of the precious metals represented by the account balances in question. A
351351 voluntary transfer of a depository account or an electronic currency
352352 account balance or of a depository account or an electronic currency
353353 account among depository account or electronic currency account holders
354354 may continue to take place unaffected by the suspension, and the
355355 depository shall recognize such voluntary transfer to the full extent
356356 authorized by this section and rules and regulations adopted under this act.
357357 (d) The state treasurer shall refer any matter relating to an action
358358 described in subsection (a) to the attorney general for resolution.
359359 Sec. 11. K.S.A. 2024 Supp. 75-4209 is hereby amended to read as
360360 follows: 75-4209. (a) The director of investments may invest and reinvest
361361 state moneys eligible for investment which are not invested in accordance
362362 with K.S.A. 75-4237, and amendments thereto, in the following
363363 investments:
364364 (1) Direct obligations of, or obligations that are insured as to principal
365365 and interest by, the United States of America or any agency thereof and
366366 obligations and securities of the United States sponsored enterprises which
367367 under federal law may be accepted as security for public funds, on and
368368 after the effective date of this act moneys available for investment under
369369 this subsection shall not be invested in mortgage-backed securities of such
370370 enterprises and of the government national mortgage association, except
371371 that any such mortgage-backed securities held prior to the effective date of
372372 this act may be held to maturity;
373373 (2) repurchase agreements with a bank or a primary government
374374 securities dealer which reports to the market reports division of the federal
375375 reserve bank of New York for direct obligations of, or obligations that are
376376 insured as to principal and interest by, the United States government or any
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420420 agency thereof and obligations and securities of United States government
421421 sponsored enterprises which under federal law may be accepted as security
422422 for public funds;
423423 (3) commercial paper that does not exceed 270 days to maturity and
424424 which has received one of the two highest commercial paper credit ratings
425425 by a nationally recognized investment rating firm; and
426426 (4) corporate bonds which have received one of the two highest
427427 ratings by a nationally recognized investment rating firm; and
428428 (5) specie legal tender, as defined in section 2, and amendments
429429 thereto.
430430 (b) When moneys are available for deposit or investments, the
431431 director of investments may invest in SKILL act projects and bonds
432432 pursuant to K.S.A. 74-8920, and amendments thereto, and in state agency
433433 bonds and bond projects.
434434 (c) When moneys are available for deposits or investments, the
435435 director of investments may invest in preferred stock of Kansas venture
436436 capital, inc., under terms and conditions prescribed by K.S.A. 74-8203,
437437 and amendments thereto, but such investments shall not in the aggregate
438438 exceed a total amount of $10,000,000.
439439 (d) When moneys are available for deposits or investments, the
440440 director of investments may invest in loans pursuant to legislative
441441 mandates, except that not more than the greater of 10% or $140,000,000 of
442442 the state moneys shall be invested. The provisions of this subsection shall
443443 not apply to the provisions of subsection (m).
444444 (e) Interest on investment accounts in banks is to be paid at maturity,
445445 but not less than annually.
446446 (f) Investments made by the director of investments under the
447447 provisions of this section shall be made with judgment and care, under
448448 circumstances then prevailing, which persons of prudence, discretion and
449449 intelligence exercise in the management of their own affairs, not for
450450 speculation, but for investment, considering the probable safety of their
451451 capital as well as the probable income to be derived.
452452 (g) Investments under subsection (a) or (b) or under K.S.A. 75-4237,
453453 and amendments thereto, shall be for a period not to exceed four years,
454454 except that linked deposits authorized under the provisions of K.S.A. 2-
455455 3703 through 2-3707, and amendments thereto, shall not exceed a period
456456 of 10 years; agricultural production loan deposits authorized under the
457457 provisions of K.S.A. 75-4268 through 75-4274, and amendments thereto,
458458 shall not exceed a period of eight years and housing loan deposits
459459 authorized under K.S.A. 75-4276 through 75-4282, and amendments
460460 thereto, shall not exceed a period of five years or 20 years, as applicable
461461 pursuant to K.S.A. 75-4279, and amendments thereto.
462462 (h) Investments in securities under subsection (a)(1) shall be limited
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506506 to securities which do not have any more interest rate risk than do direct
507507 United States government obligations of similar maturities. For purposes
508508 of this subsection, "interest rate risk" means market value changes due to
509509 changes in current interest rates.
510510 (i) The director of investments shall not invest state moneys eligible
511511 for investment under subsection (a), in the municipal investment pool
512512 fund, created under K.S.A. 12-1677a, and amendments thereto.
513513 (j) The director of investments shall not invest moneys in the pooled
514514 money investment portfolio in derivatives. As used in this subsection,
515515 "derivatives" means a financial contract whose value depends on the value
516516 of an underlying asset or index of asset values.
517517 (k) Moneys and investments in the pooled money investment
518518 portfolio shall be invested and reinvested by the director of investments in
519519 accordance with investment policies developed, approved, published and
520520 updated on an annual basis by the board. Such investment policies shall
521521 include at a minimum guidelines which identify credit standards, eligible
522522 instruments, allowable maturity ranges, methods for valuing the portfolio,
523523 calculating earnings and yields and limits on portfolio concentration for
524524 each type of investment. Any changes in such investment policies shall be
525525 approved by the pooled money investment board. Such investment policies
526526 may specify the contents of reports, methods of crediting funds and
527527 accounts and other operating procedures.
528528 (l) The board shall adopt rules and regulations to establish an overall
529529 percentage limitation on the investment of moneys in investments
530530 authorized under subsection (a)(3), and within such authorized investment,
531531 the board shall establish a percentage limitation on the investment in any
532532 single business entity.
533533 (m) (1) During the fiscal year ending June 30, 2017, the director of
534534 the budget shall estimate on or before June 27, 2017, the amount of the
535535 unencumbered ending balance in the state general fund for fiscal year
536536 2017. If the amount of such unencumbered ending balance in the state
537537 general fund is less than $50,000,000, the director of the budget shall
538538 certify the difference between $50,000,000, and the amount of such
539539 unencumbered ending balance to the pooled money investment board.
540540 Upon the liquidation of all investments and reinvestments of state moneys
541541 pursuant to K.S.A. 75-2263(j), and amendments thereto, and upon receipt
542542 of such certification by the director of the budget, during the fiscal year
543543 ending June 30, 2017, the pooled money investment board shall authorize
544544 the director of accounts and reports to transfer an amount equal to the
545545 amount certified by the director of the budget pursuant to this subsection
546546 from the pooled money investment portfolio to the state general fund.
547547 Upon receipt of such authorization, the director of accounts and reports
548548 shall make such transfer. The chairperson of the pooled money investment
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592592 board shall transmit a copy of such authorization to the director of
593593 legislative research and the director of the budget.
594594 (2) (A) On or before June 30, 2019, the director of accounts and
595595 reports shall transfer an amount equal to
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597597 /6 of the amount transferred
598598 pursuant to subsection (m)(1) from the state general fund to the pooled
599599 money investment portfolio.
600600 (B) On or before June 30, 2020, the director of accounts and reports
601601 shall transfer an amount equal to
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603603 /2 of the amount transferred pursuant to
604604 subsection (m)(1), reduced by the amount transferred pursuant to
605605 subsection (m)(2)(A) from the state general fund to the pooled money
606606 investment portfolio.
607607 (C) On or before June 30, 2021, and June 30, 2022, during each such
608608 fiscal year, the director of accounts and reports shall transfer an amount
609609 equal to
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611611 /2 of the amount transferred pursuant to subsection (m)(1),
612612 reduced by the amount transferred pursuant to subsection (m)(2)(A) and
613613 (m)(2)(B) from the state general fund to the pooled money investment
614614 portfolio.
615615 (3) During the fiscal year ending June 30, 2018, after any transfer
616616 made pursuant to subsection (m)(1), the pooled money investment board
617617 shall authorize the director of accounts and reports to transfer the
618618 remaining amount of all investments and reinvestments of state moneys
619619 liquidated pursuant to K.S.A. 75-2263(j), and amendments thereto, from
620620 the pooled money investment portfolio to the state general fund. Upon
621621 receipt of such authorization, the director of accounts and reports shall
622622 make such transfer. The chairperson of the pooled money investment
623623 board shall transmit a copy of such authorization to the director of
624624 legislative research and the director of the budget.
625625 (4) (A) On or before June 30, 2019, the director of accounts and
626626 reports shall transfer an amount equal to
627627 1
628628 /6 of the amount transferred
629629 pursuant to subsection (m)(3) from the state general fund to the pooled
630630 money investment portfolio.
631631 (B) On or before June 30, 2020, the director of accounts and reports
632632 shall transfer an amount equal to
633633 1
634634 /2 of the amount transferred pursuant to
635635 subsection (m)(3), reduced by the amount transferred pursuant to
636636 subsection (m)(4)(A) from the state general fund to the pooled money
637637 investment portfolio.
638638 (C) On or before June 30, 2021, and June 30, 2022, during each such
639639 fiscal year, the director of accounts and reports shall transfer an amount
640640 equal to
641641 1
642642 /2 of the amount transferred pursuant to subsection (m)(3),
643643 reduced by the amount transferred pursuant to subsection (m)(4)(A) and
644644 (m)(4)(B) from the state general fund to the pooled money investment
645645 portfolio Investments in specie legal tender under subsection (a)(5) shall
646646 not exceed 20% of the total amount of the pooled money investment
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690690 portfolio at the time such investment is made.
691691 Sec. 12. K.S.A. 2024 Supp. 75-4209 is hereby repealed.
692692 Sec. 13. This act shall take effect and be in force from and after its
693693 publication in the statute book.
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