HLS 25RS-889 ORIGINAL
2025 Regular Session
HOUSE BILL NO. 579
BY REPRESENTATIVE EMERSON
Prefiled pursuant to Article III, Section 2(A)(4)(b)(i) of the Constitution of Louisiana.
FUNDS/FUNDING: Provides for the transfer, deposit, and use of monies among state funds
1 AN ACT
2To amend and reenact R.S. 17:3801(A) and (C) and 3802(A)(1), R.S. 39:98.1, 98.2(A) and
3 (E), 98.3(A) and (C)(introductory paragraph), and 100.161(B)(3) and to repeal R.S.
4 17:3801 through 3805 and R.S. 39:98.3(C) and (E), relative to certain treasury funds;
5 to provide for the transfer, deposit, and use, as specified, of monies in certain
6 treasury funds and accounts; to provide for the investment of certain treasury funds
7 and accounts; to repeal certain treasury funds and accounts; to provide for
8 effectiveness; and to provide for related matters.
9Be it enacted by the Legislature of Louisiana:
10 Section 1. R.S. 17:3801(A) and (C) and 3802(A)(1) are hereby amended and
11reenacted to read as follows:
12 §3801. Louisiana Education Quality Trust Fund, hereinafter referred to in this Part
13 as the "Kevin P. Reilly, Sr. Louisiana Education Quality Trust Fund"
14 A.(1) There shall be established in the state treasury as a special permanent
15 trust fund, the "Kevin P. Reilly, Sr. Louisiana Education Quality Trust Fund",
16 henceforth referred to as the "Permanent Trust Fund". After allocation of money to
17 the Bond Security and Redemption Fund as provided in Article VII, Section 9(B) of
18 the constitution, and notwithstanding Article XIV, Section 10 of the constitution, the
19 treasurer shall deposit in and credit to the Permanent Trust Fund all money which is
20 received from the federal government under Section 1337(g) of Title 43 of the
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1 United States Code which is attributable to mineral production activity or leasing
2 activity on the Outer Continental Shelf which has been held in escrow pending a
3 settlement between the United States and the state of Louisiana, except the first one
4 hundred million dollars so received; twenty-five percent of the recurring revenues
5 received under Section 1337(g) of Title 43 of the United States Code which are
6 attributable to mineral production activity or leasing activity on the Outer
7 Continental Shelf; twenty-five percent of the interest income earned on investment
8 of monies in the Permanent Trust Fund; and seventy-five percent of realized capital
9 gains and twenty-five percent of dividend income earned on investment of the
10 Permanent Trust Fund. No appropriation shall be made from the Permanent Trust
11 Fund.
12 (2) After six hundred million dollars has been credited to the Permanent
13 Trust Fund from those monies received from the federal government under Section
14 1337(g) of Title 43 of the United States Code which are attributable to mineral
15 production activity or leasing activity on the Outer Continental Shelf which has been
16 held in escrow pending a settlement between the United States and the state of
17 Louisiana, the sum of fifty million dollars shall be credited from such monies to the
18 Coastal Environment Protection Trust Fund, as established in R.S. 30:313; all such
19 funds in excess of seven hundred fifty million dollars shall be credited to the
20 Permanent Trust Fund.
21 (3) After allocation of money to the Bond Security and Redemption Fund as
22 provided in Article VII, Section 9(B) of the constitution, and notwithstanding Article
23 XIV, Section 10 of the constitution, seventy-five percent of the recurring revenues
24 received under Section 1337(g) of Title 43 of the United States Code which are
25 attributable to mineral production activity or leasing activity, seventy-five percent
26 of the interest income earned on investment of the Permanent Trust Fund, and
27 twenty-five percent of realized capital gains and seventy-five percent of the dividend
28 income earned on investment of the Permanent Trust Fund shall be deposited and
29 credited to a There is hereby created a special fund which is hereby created in the
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1 state treasury, and which shall be known as the Louisiana Quality Education Support
2 Fund, hereinafter hereafter referred to in this Section as the "Support Fund".
3 Beginning July 1, 2001, and only as to and in the accounting of earnings after that
4 date, the treasurer shall account for earnings from the Permanent Fund in a manner
5 which allocates the earnings between the Permanent Fund and the Support Fund in
6 the proportions as herein provided as such earnings are realized. Beginning July 1,
7 2001, and only as to and in the accounting of earnings after that date, the treasurer
8 shall account for earnings attributable to Support Fund balances due the boards of
9 education separately and allocate such earnings to the credit of each board
10 respectively.
11 (4) All recurring revenues and interest earnings shall be credited to the
12 respective funds as provided in Paragraphs (1) and (2) above until the balance in the
13 Permanent Trust Fund equals two billion dollars. After the Permanent Trust Fund
14 reaches a balance of two billion dollars, all interest earnings on the Permanent Trust
15 Fund shall be credited to the Support Fund and all recurring revenues shall be
16 credited to the State General Fund.
17 * * *
18 C.(1) The amounts in the Support Fund shall be available for appropriation
19 to pay expenses incurred for outside investment managers for the investment and
20 management of the Permanent Trust Fund and for other custody, investment, and
21 disbursement costs directly attributable to the Permanent Trust Fund, and for
22 educational purposes only as provided in these Sections.
23 (2) The State Board of Elementary and Secondary Education and the Board
24 of Regents each shall annually submit to the legislature and the governor not less
25 than sixty days prior to the beginning of each regular session of the legislature a
26 proposed program and budget for the expenditure of the monies in the Support Fund.
27 Proposals for such expenditures shall be designed to improve the quality of
28 education. Except for monies appropriated to pay expenses incurred in investment
29 and management of the Permanent Trust Fund, monies appropriated from the
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1 Support Fund by the legislature shall be disbursed to the Board of Regents and the
2 State Board of Elementary and Secondary Education to be allocated by them as
3 provided by law or the constitution to the programs as previously approved by the
4 legislature.
5 (3) The treasurer shall disburse not more than fifty percent of the monies in
6 the Support Fund as that money is appropriated by the legislature and allocated by
7 the Board of Regents for any or all of the following higher educational purposes to
8 enhance economic development:
9 (a) The carefully defined research efforts of public and private universities
10 in Louisiana.
11 (b) The endowment of chairs for eminent scholars.
12 (c) The enhancement of the quality of academic, research, or agricultural
13 departments or units within a community college, college, or university. These funds
14 shall not be used for athletic purposes or programs.
15 (d) The recruitment of superior graduate students.
16 (4) (3) The treasurer shall disburse not more than fifty percent of the monies
17 in the Support Fund as that money is appropriated by the legislature and allocated by
18 the State Board of Elementary and Secondary Education for any or all of the
19 following elementary and secondary educational purposes:
20 (a) To provide compensation to city or parish school board professional
21 instructional employees.
22 (b) To insure an adequate supply of superior textbooks, library books,
23 equipment, and other instructional materials.
24 (c) To fund exemplary programs in elementary, secondary, or vocational-
25 technical schools designed to improve elementary and secondary student academic
26 achievement, or vocational-technical skill.
27 (d) To fund carefully defined research efforts, including pilot programs,
28 designed to improve elementary and secondary student academic achievement.
29 (e) To fund summer school remediation programs and preschool programs.
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1 (f) To fund the teaching of foreign languages in elementary and secondary
2 schools.
3 (g) To fund an adequate supply of teachers by providing scholarships or
4 stipends to prospective teachers in academic areas where there is a critical teacher
5 shortage.
6 * * *
7 §3802. Appropriations; procedure; limitation; administration
8 A.(1) Consistent with the provisions of the Constitution of Louisiana, the
9 The legislature shall appropriate the total amount of the funds in the Louisiana
10 Quality Education Support Fund, hereinafter referred to as the "support fund",
11 intended for higher educational purposes to the Board of Regents and the total
12 amount intended for elementary and secondary educational purposes to the State
13 Board of Elementary and Secondary Education itemized by program or other
14 recipient purpose. Such itemization shall occur in both the executive budget and in
15 the general appropriation bill and, except as otherwise provided by the constitution,
16 budget and appropriation functions shall be conducted as provided by law. Passage
17 of the general appropriation bill shall constitute legislative approval of the programs
18 or purposes to which money is appropriated.
19 * * *
20 Section 2. R.S. 39:98.1, 98.2(A) and (E), 98.3(A) and (C)(introductory paragraph),
21and 100.161(B)(3) are hereby amended and reenacted to read as follows:
22 §98.1. Creation of Funds; Millennium Trust
23 A. There shall be established in the state treasury as a special permanent trust
24 fund known as the Millennium Trust. After allocation of money to the Bond
25 Security and Redemption Fund as provided in Article VII, Section 9(B) (13)(B) of
26 the Constitution of Louisiana, the treasurer shall deposit in and credit to the
27 Millennium Trust certain monies received as a result of the Master Settlement
28 Agreement, hereinafter the "Settlement Agreement", executed November 23, 1998,
29 and approved by Consent Decree and Final Judgment entered in the case "Richard
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1 P. Ieyoub, Attorney General, ex rel. State of Louisiana v. Philip Morris,
2 Incorporated, et al.", bearing Number 98-6473 on the docket of the Fourteenth
3 Judicial District for the parish of Calcasieu, state of Louisiana; and all dividend and
4 interest income and all realized capital gains on investment of monies in the
5 Millennium Trust. The treasurer shall deposit in and credit to the Millennium Trust
6 the following amounts of monies received as a result of the Settlement Agreement:
7 (1) Fiscal Year 2000-2001, forty-five percent of the total monies received
8 that year.
9 (2) Fiscal Year 2001-2002, sixty percent of the total monies received that
10 year.
11 (3) Fiscal Year 2002-2003 and each fiscal year thereafter, seventy-five
12 percent of the total monies received that year. each fiscal year as a result of the
13 Settlement Agreement. However, beginning in Fiscal Year 2011-2012 after the
14 balance in the Millennium Trust reaches a total of one billion three hundred eighty
15 million dollars, the The monies deposited in and credited to the Millennium Trust,
16 received by the state as a result of the Settlement Agreement, shall be allocated to
17 the various funds within the Millennium Trust as provided in Subsections B, C, and
18 D of this Section TOPS Fund.
19 (4) For Fiscal Year 2000-2001, Fiscal Year 2001-2002, and Fiscal Year
20 2002-2003, ten percent of the total monies received in each of those years for credit
21 to the Education Excellence Fund which, notwithstanding the provisions of R.S.
22 39:98.3(A), shall be appropriated for the purposes provided in R.S. 39:98.3(C)(4).
23 B.(1) The Health Excellence Fund shall be established as a special fund
24 within the Millennium Trust. The treasurer shall credit to the Health Excellence Fund
25 one-third of the Settlement Agreement proceeds deposited each year into the
26 Millennium Trust and one-third one-half of all dividend and interest income and all
27 realized capital gains on investment of monies in the Millennium Trust. The
28 treasurer shall report annually to the legislature as to the amount of Millennium Trust
29 investment earnings credited to the Health Excellence Fund.
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1 (2) Beginning Fiscal Year 2011-2012, and each fiscal year thereafter, the
2 treasurer shall credit to the Health Excellence Fund one-third of all dividend and
3 interest income and all realized capital gains on investment of monies in the
4 Millennium Trust.
5 (3) Beginning July 1, 2012, after After allocation of money to the Bond
6 Security and Redemption Fund as provided in Article VII, Section 9(B) 13(B) of the
7 Constitution of Louisiana, the treasurer shall deposit in and credit to the Health
8 Excellence Fund the revenues derived from the tax imposed by R.S. 47:841(B)(3).
9 C.(1) The Education Excellence Fund shall be established in the state
10 treasury as a special fund within the Millennium Trust. The treasurer shall credit to
11 the Education Excellence Fund one-third of the Settlement Agreement proceeds
12 deposited into the Millennium Trust and one-third of all dividend and interest
13 income and all realized capital gains on investment of monies in the Millennium
14 Trust.
15 (2) Beginning Fiscal Year 2011-2012, and each fiscal year thereafter, the
16 treasurer shall credit to the Education Excellence Fund one-third of all dividend and
17 interest income and all realized capital gains on investment of monies in the
18 Millennium Trust.
19 D.(1) The TOPS Fund shall be established in the state treasury as a special
20 fund within the Millennium Trust. The treasurer shall credit to the TOPS Fund one-
21 third of the Settlement Agreement proceeds deposited into the Millennium Trust and
22 one-third of all dividend and interest income and all realized capital gains on
23 investment of monies in the Millennium Trust.
24 (2) Beginning Fiscal Year 2011-2012, and each fiscal year thereafter, the
25 treasurer shall credit to the TOPS Fund one hundred percent of the Settlement
26 Agreement proceeds deposited into the Millennium Trust and one-third one-half of
27 all dividend and interest income and all realized capital gains on investment of
28 monies in the Millennium Trust. The treasurer shall report annually to the legislature
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1 as to the amount of Millennium Trust settlement agreement proceeds investment
2 earnings credited to the TOPS Fund.
3 (3) Upon the effective date of this Section, the state treasurer shall deposit,
4 transfer, or otherwise credit funds in an amount equal to such Settlement Agreement
5 proceeds deposited in and credited to the Millennium Trust received by the state
6 between April 1, 2011, and the effective date of this Section to the TOPS Fund.
7 D. Monies credited to the Millennium Trust pursuant to Subsection A of this
8 Section shall be invested by the treasurer. A portion of the monies, not to exceed
9 thirty-five percent, may be invested in stock. However, the portion of monies in the
10 Millennium Trust which may be invested in stock may be increased to no more than
11 fifty percent by a specific legislative instrument which receives a favorable vote of
12 two-thirds of the elected members of each house of the legislature. The legislature
13 shall provide for procedures for the investment of such monies as provided in R.S.
14 39:98.2. The treasurer may contract, subject to the approval of the State Bond
15 Commission, for the management of such investments and, if a contract is entered
16 into, amounts necessary to pay the costs of the contract shall be appropriated from
17 the Millennium Trust.
18 §98.2. Investment of Millennium Trust
19 A. The treasurer is authorized and directed to invest monies in the
20 Millennium Trust which are available for investment in the investments permitted
21 for the Louisiana Education Quality Trust Fund, also known as the Kevin P. Reilly
22 Sr. Louisiana Education Quality Trust Fund, as set forth in R.S. 17:3803(B), (D), and
23 (E). any of the following:
24 (1) Time certificates of deposit of any bank domiciled or having a branch
25 office in the state of Louisiana, savings accounts or shares of savings and loan
26 associations and savings banks, as defined by R.S. 6:703(16) and (17), or share
27 accounts and share certificate accounts of federally or state-chartered credit unions
28 issuing time certificates of deposit, issued for the state treasurer under this authority.
29 For those funds determined under prudent judgment of the state treasurer to be made
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1 available for investment in time certificates of deposit, the rate of interest paid by the
2 banks shall be determined by rules and regulations adopted and promulgated by the
3 state treasurer. Competitive bidding may be used to establish the rate of interest on
4 fifty percent or less of the amount determined to be available as of that date for
5 investment in time certificates of deposit. Those financial institutions bidding on
6 time certificates of deposit shall meet the financial criteria established by rules and
7 regulations adopted and promulgated by the state treasurer. At the time of
8 investment, the interest rate under the provisions of this Subsection shall be a rate not
9 less than the prevailing market interest rate on direct obligations of the United States
10 Treasury with a similar length of maturity. The funds so invested shall not exceed
11 at any time the amount insured by the Federal Deposit Insurance Corporation (FDIC)
12 in any one bank, savings bank, or savings and loan association and shall not exceed
13 at any time the amount insured by the National Credit Union Administration, or other
14 deposit insurance corporation, in any one credit union, unless the uninsured portion
15 is collateralized by the pledge of securities in the manner provided by R.S. 49:321.
16 (2) Direct obligations of the United States government, a United States
17 government agency, a United States government instrumentality, or a United States
18 government-sponsored enterprise, the timely payment of the principal and interest
19 of which is fully and explicitly guaranteed by the full faith and credit of the
20 government of the United States of America, and contained in a list promulgated by
21 the state treasurer.
22 (3) Direct obligations of a United States government agency, United States
23 government instrumentality, or United States government-sponsored enterprise, the
24 timely payment of principal and interest of which is fully guaranteed by the issuing
25 entity, but are not explicitly guaranteed by the full faith and credit of the government
26 of the United States, and contained in a list promulgated by the state treasurer.
27 (4) Stocks of any corporation listed on the New York Stock Exchange, the
28 American Stock Exchange, the National Association of Securities Dealers
29 Automated Quotations System, or other such stock exchange domiciled in the United
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1 States and registered with the United States Securities and Exchange Commission,
2 provided that the total investment in such stocks at any one time shall not exceed
3 thirty-five percent of the market value of all funds held by the treasurer in the
4 Millennium Trust.
5 (5)(a) Investment grade commercial paper issued in the United States, traded
6 in the United States markets, denominated in United States dollars, with a short-term
7 rating of at least A-1 by Standard & Poor's Financial Services LLC or P-1 by
8 Moody's Investor Service, Inc. or the equivalent rating by a nationally recognized
9 statistical rating organization.
10 (b) Investment grade corporate notes and bonds issued in the United States,
11 traded in United States markets, denominated in United States dollars, rated BAA or
12 better by Moody's Investor Service, Inc., or BBB or better by Standard & Poor's
13 Financial Services LLC, and the trades of which are settled through The Depository
14 Trust & Clearing Corporation, a national clearinghouse in the United States for the
15 settlement of securities trades.
16 (6) Money market funds consisting solely of securities otherwise eligible for
17 investment by the treasurer pursuant to this Section.
18 (7) Open-end mutual funds, closed-end mutual funds, and unit investment
19 trusts consisting solely of securities otherwise eligible for investment by the state
20 treasurer.
21 (8)(a) Tax exempt bonds and other taxable governmental bonds. In addition
22 to all other investment authority related to the Millennium Trust, the state treasurer
23 may invest in tax exempt bonds as defined in R.S. 49:342(C) and in taxable bonds
24 issued by any state or a political subdivision or public corporation of any state,
25 provided that such taxable bonds are rated at the time the investment is made by a
26 nationally recognized rating agency in one of the three highest rating categories of
27 that rating agency.
28 (b) Bonds, debentures, notes, or other similar obligations issued in the
29 United States market, denominated in United States dollars and which are the direct
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1 legal obligations of a foreign nation which the International Monetary Fund lists as
2 an industrial country, for which investments in and/or business transactions with are
3 not prohibited or restricted by any law, regulation, or rule of the United States or the
4 state of Louisiana, and for which the full faith and credit of such nation has been
5 pledged for the payment of principal and interest; provided that any such security
6 shall be rated at least A- or better by Standard & Poor's Corporation or A3 or better
7 by Moody's, Inc., or an equivalent investment grade by a securities ratings
8 organization accepted by the National Association of Insurance Commissioners; and,
9 provided further that the total investment in such foreign securities at any one time
10 shall not exceed five percent of the market value of all investments held by the
11 treasurer in the Millennium Trust, or any other fund or investment of funds subject
12 to this investment authority.
13 (9) Any investment managers hired on a contract basis to advise the treasurer
14 regarding such investments shall be selected by the treasurer, subject to the approval
15 of the State Bond Commission, in accordance with a request for proposal process
16 using strict selection criteria based on sound industry principles. The contract, as
17 approved by the State Bond Commission, shall be on a fee, together with minimum
18 exchange fee, basis or on a commission basis only. The state treasurer shall adopt
19 and promulgate rules and regulations for such investments and for the selection of
20 outside investment managers.
21 (10) Open-end mutual funds, closed-end mutual funds, exchange-traded
22 funds, and unit investment trusts consisting solely of international securities
23 constructed to match or track the components of a market index provided by globally
24 recognized index providers, including but not limited to MSCI, FTSE, Dow Jones,
25 Standard & Poor's, Barclays, Citigroup, or any of their affiliates or successors and
26 assigns; however, the total investment in any and all such index funds at any one
27 time shall not exceed ten percent of the market value of all funds held by the
28 treasurer in the Millennium Trust. Nothing in this Paragraph shall be construed to
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1 allow the state treasurer to invest directly in the common stock of foreign companies
2 known to do business with nations that support terrorism.
3 * * *
4 E. On or before December first of each year, the treasurer shall prepare and
5 submit a report on the performance of the Millennium Trust to the Joint Legislative
6 Committee on the Budget and the commissioner of administration for their review.
7 With respect to the Education Excellence Fund, the report shall also be provided to
8 the state superintendent of education.
9 * * *
10 §98.3. Appropriations from the Health Excellence Fund, the Education Excellence
11 Fund, and the TOPS Fund Appropriations from funds within the Millennium
12 Trust
13 A.(1) Appropriations from the Education Excellence Fund shall be limited
14 to an annual amount not to exceed the estimated aggregate annual earnings from
15 interest, dividends, and realized capital gains on investment of the Millennium Trust
16 allocated as provided by R.S. 39:98.1(B) and (C) as recognized by the Revenue
17 Estimating Conference. Amounts determined to be available for appropriation shall
18 be those aggregate investment earnings which are in excess of an inflation factor as
19 determined by the Revenue Estimating Conference. The amount of estimated
20 aggregate investment earnings available for appropriation shall be determined by
21 subtracting the product of the inflation factor multiplied by the amount of aggregate
22 investment earnings for the previous fiscal year from the amount of such estimated
23 aggregate investment earnings. The amount of realized capital gains on investment
24 which may be included in the aggregate earnings available for appropriation from the
25 Millennium Trust in any fiscal year shall not exceed the aggregate of earnings from
26 interest and dividends for that year.
27 (2)(a) For Fiscal Year 2011-2012 appropriations from the Health Excellence
28 Fund shall be limited to an annual amount not to exceed the estimated aggregate
29 annual earnings from interest, dividends, and realized capital gains on investment of
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1 the trust and credited to the Health Excellence Fund as provided by R.S.
2 39:98.1(B)(2) and as recognized by the Revenue Estimating Conference.
3 (b) For Fiscal Year 2012-2013, and For each fiscal year thereafter,
4 appropriations from the Health Excellence Fund shall be limited to an annual amount
5 not to exceed the estimated aggregate annual earnings from interest, dividends, and
6 realized capital gains on investment of the trust and credited to the Health Excellence
7 Fund as provided by R.S. 39:98.1(B)(2) R.S. 39:98.1(B)(1) and as recognized by the
8 Revenue Estimating Conference and the amount of proceeds credited to and
9 deposited into the Health Excellence Fund as provided by R.S. 39:98.1(B)(3) R.S.
10 39:98.1(B)(2).
11 (3)(a) For Fiscal Year 2011-2012, appropriations from the TOPS Fund shall
12 be limited to the amount of Settlement Agreement proceeds credited to and deposited
13 into the TOPS Fund as provided by R.S. 39:98.1(D)(2) and (3), and an annual
14 amount not to exceed the estimated aggregate annual earnings from interest,
15 dividends, and realized capital gains on investment of the trust and credited to the
16 TOPS Fund as provided by R.S. 39:98.1(D)(2) and as recognized by the Revenue
17 Estimating Conference.
18 (b) (2)(a) For Fiscal Year 2012-2013, and each fiscal year thereafter,
19 appropriations from the TOPS Fund shall be limited to the amount of annual
20 Settlement Agreement proceeds credited to and deposited into the TOPS Fund as
21 provided in R.S. 39:98.1(D)(2) R.S. 39:98.1(C), and an annual amount not to exceed
22 the estimated aggregate annual earnings from interest, dividends, and realized capital
23 gains on investment of the trust and credited to the TOPS Fund as provided in R.S.
24 39:98.1(D)(2) R.S. 39:98.1(C) and as recognized by the Revenue Estimating
25 Conference.
26 (c) For Fiscal Year 2011-2012, and each fiscal year thereafter, (b) The
27 amounts determined to be available for appropriation from the TOPS Fund from
28 interest earnings shall be those aggregate investment earnings which are in excess
29 of an inflation factor as determined by the Revenue Estimating Conference. The
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1 amount of realized capital gains on investment which may be included in the
2 aggregate earnings available for appropriation in any year shall not exceed the
3 aggregate of earnings from interest and dividends for that year.
4 (4) (3) Actual earnings from interest, dividends, and capital gains during the
5 fiscal year in excess of the amounts estimated as available for appropriation shall be
6 credited to the appropriate fund and available for appropriation in subsequent years.
7 Appropriations from the Health Excellence Fund, the Education Excellence Fund,
8 and the TOPS Fund shall include performance expectations to ensure accountability
9 in the expenditure of such monies.
10 * * *
11 C. The Education Excellence Fund shall be established in the state treasury
12 as a special fund within the Millennium Trust. Appropriations from the Education
13 Excellence Fund shall be restricted as follows:
14 * * *
15 §100.161. Louisiana Unclaimed Property Permanent Trust Fund
16 * * *
17 B.
18 * * *
19 (3) Subject to the limitations provided in this Subsection, the state treasurer
20 may invest the monies deposited in and credited to the UCP Permanent Trust Fund
21 in the same manner as authorized for the Louisiana Education Quality Trust Fund as
22 set forth in R.S. 17:3803. any of the following:
23 (i) Time certificates of deposit of any bank domiciled or having a branch
24 office in the state of Louisiana, savings accounts or shares of savings and loan
25 associations and savings banks, as defined by R.S. 6:703(16) and (17), or share
26 accounts and share certificate accounts of federally or state-chartered credit unions
27 issuing time certificates of deposit, issued for the state treasurer under this authority.
28 For those funds determined under prudent judgment of the state treasurer to be made
29 available for investment in time certificates of deposit, the rate of interest paid by the
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1 banks shall be determined by rules and regulations adopted and promulgated by the
2 state treasurer. Competitive bidding may be used to establish the rate of interest on
3 fifty percent or less of the amount determined to be available as of that date for
4 investment in time certificates of deposit. Those financial institutions bidding on
5 time certificates of deposit shall meet the financial criteria established by rules and
6 regulations adopted and promulgated by the state treasurer. At the time of
7 investment, the interest rate under the provisions of this Subsection shall be a rate not
8 less than the prevailing market interest rate on direct obligations of the United States
9 Treasury with a similar length of maturity. The funds so invested shall not exceed
10 at any time the amount insured by the Federal Deposit Insurance Corporation (FDIC)
11 in any one bank, savings bank, or savings and loan association and shall not exceed
12 at any time the amount insured by the National Credit Union Administration, or other
13 deposit insurance corporation, in any one credit union, unless the uninsured portion
14 is collateralized by the pledge of securities in the manner provided by R.S. 49:321.
15 (ii) Direct obligations of the United States government, a United States
16 government agency, a United States government instrumentality, or a United States
17 government-sponsored enterprise, the timely payment of the principal and interest
18 of which is fully and explicitly guaranteed by the full faith and credit of the
19 government of the United States of America, and contained in a list promulgated by
20 the state treasurer.
21 (iii) Direct obligations of a United States government agency, United States
22 government instrumentality, or United States government-sponsored enterprise, the
23 timely payment of principal and interest of which is fully guaranteed by the issuing
24 entity, but are not explicitly guaranteed by the full faith and credit of the government
25 of the United States, and contained in a list promulgated by the state treasurer.
26 (iv) Stocks of any corporation listed on the New York Stock Exchange, the
27 American Stock Exchange, the National Association of Securities Dealers
28 Automated Quotations System, or other such stock exchange domiciled in the United
29 States and registered with the United States Securities and Exchange Commission,
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1 provided that the total investment in such stocks at any one time shall not exceed
2 thirty-five percent of the market value of all funds held by the treasurer in the UCP
3 Permanent Trust Fund.
4 (v)(aa) Investment grade commercial paper issued in the United States,
5 traded in the United States markets, denominated in United States dollars, with a
6 short-term rating of at least A-1 by Standard & Poor's Financial Services LLC or P-1
7 by Moody's Investor Service, Inc., or the equivalent rating by a nationally recognized
8 statistical rating organization.
9 (bb) Investment grade corporate notes and bonds issued in the United States,
10 traded in United States markets, denominated in United States dollars, rated BAA or
11 better by Moody's Investor Service, Inc., or BBB or better by Standard & Poor's
12 Financial Services LLC, and the trades of which are settled through The Depository
13 Trust & Clearing Corporation, a national clearinghouse in the United States for the
14 settlement of securities trades.
15 (vi) Money market funds consisting solely of securities otherwise eligible
16 for investment by the treasurer pursuant to this Section.
17 (vii) Open-end mutual funds, closed-end mutual funds, and unit investment
18 trusts consisting solely of securities otherwise eligible for investment by the state
19 treasurer.
20 (viii) Tax exempt bonds and other taxable governmental bonds. In addition
21 to all other investment authority related to the UCP Permanent Trust Fund, the state
22 treasurer may invest in tax exempt bonds as defined in R.S. 49:342(C), and in
23 taxable bonds issued by any state or a political subdivision or public corporation of
24 any state, provided that such taxable bonds are rated at the time the investment is
25 made by a nationally recognized rating agency in one of the three highest rating
26 categories of that rating agency.
27 (ix) Bonds, debentures, notes, or other similar obligations issued in the
28 United States market, denominated in United States dollars and are the direct legal
29 obligations of a foreign nation which the International Monetary Fund lists as an
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1 industrial country, for which investments in and/or business transactions with are not
2 prohibited or restricted by any law, regulation, or rule of the United States or the
3 state of Louisiana, and for which the full faith and credit of such nation has been
4 pledged for the payment of principal and interest; provided that any such security
5 shall be rated at least A- or better by Standard & Poor's Corporation or A3 or better
6 by Moody's, Inc., or an equivalent investment grade by a securities ratings
7 organization accepted by the National Association of Insurance Commissioners; and,
8 provided further that the total investment in such foreign securities at any one time
9 shall not exceed five percent of the market value of all investments held by the
10 treasurer in the UCP Permanent Trust Fund, or any other fund or investment of funds
11 subject to this investment authority.
12 (x) Any investment managers hired on a contract basis to advise the treasurer
13 regarding such investments shall be selected by the treasurer, subject to the approval
14 of the State Bond Commission, in accordance with a request for proposal process
15 using strict selection criteria based on sound industry principles. The contract, as
16 approved by the State Bond Commission, shall be on a fee, together with minimum
17 exchange fee, basis or on a commission basis only. The state treasurer shall adopt
18 and promulgate rules and regulations for such investments and for the selection of
19 outside investment managers.
20 (xi) Open-end mutual funds, closed-end mutual funds, exchange-traded
21 funds, and unit investment trusts consisting solely of international securities
22 constructed to match or track the components of a market index provided by globally
23 recognized index providers, including but not limited to MSCI, FTSE, Dow Jones,
24 Standard & Poor's, Barclays, Citigroup, or any of their affiliates or successors and
25 assigns; however, the total investment in any and all such index funds at any one
26 time shall not exceed ten percent of the market value of all funds held by the
27 treasurer in the UCP Permanent Trust Fund. Nothing in this Item shall be construed
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1 to allow the state treasurer to invest directly in the common stock of foreign
2 companies known to do business with nations that support terrorism.
3 * * *
4 Section 3. R.S. 17:3801(B), (C)(4) and (F) and R.S. 39:98.3(E) are hereby repealed
5in their entirety.
6 Section 4. R.S. 17:3801 through 3805 and R.S. 39:98.3(C) are hereby repealed in
7their entirety.
8 Section 5. The provision of Section 4 of this Act shall take effect and become
9operative on July 1, 2027, if and when the proposed amendment of Article VII of the
10Constitution of Louisiana contained in the Act which originated as House Bill No. ____ of
11this 2025 Regular Session of the Legislature is adopted at a statewide election and becomes
12effective.
13 Section 6. The provision of Sections 1, 2, and 3 of this Act shall take effect and
14become operative if and when the proposed amendment of Article VII of the Constitution
15of Louisiana contained in the Act which originated as House Bill No. ____ of this 2025
16Regular Session of the Legislature is adopted at a statewide election and becomes effective.
17 Section 7. This Section and Sections 5 and 6 of this Act shall become effective upon
18signature by the governor or, if not signed by the governor, upon expiration of the time for
19bills to become law without signature by the governor, as provided by Article III, Section
2018 of the Constitution of Louisiana. If vetoed by the governor and subsequently approved
21by the legislature, this Act shall become effective on the day following such approval.
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HB NO. 579
DIGEST
The digest printed below was prepared by House Legislative Services. It constitutes no part
of the legislative instrument. The keyword, one-liner, abstract, and digest do not constitute
part of the law or proof or indicia of legislative intent. [R.S. 1:13(B) and 24:177(E)]
HB 579 Original 2025 Regular Session Emerson
Abstract Provides for the transfer, deposit, and use of monies among state funds
Louisiana Education Quality Trust Fund (LEQTF)
and the Louisiana Quality Education Support Fund (Support Fund)
Present law provides for allocations to the LEQTF and the Support Fund and appropriations
from these funds.
Proposed law repeals provisions related to the allocations made to the LEQTF and the
Support Fund. Retains provisions related to appropriations from the funds. Proposed law
repeals all provisions related to both funds effective July 1, 2027.
Millennium Trust
Present law creates a special fund in the state treasury called the Millennium Trust. Provides
for deposits into the fund from monies received as a result of the tobacco settlement, as well
as any interest income and realized capital gains on investment of monies in the fund.
Provides for 75% of the tobacco settlement funds to be deposited into the Millennium Trust.
Creates three special subfunds within the Millennium Trust: (1) the Health Excellence Fund;
(2) the Education Excellence Fund; and (3) the TOPS Fund.
Present law provides that beginning in FY 2012, deposits shall be made as follows: (1) 1/3
of all dividend and interest income and all realized capital gains on investments of monies
in the fund to the Health Excellence Fund; (2) 1/3 of all dividend and interest income and
all realized capital gains on investments of monies into the Education Excellence Fund; and
(3) 100% (of the 75%) of the tobacco settlement proceeds deposited into the Millennium
Trust Fund and 1/3 of all dividend and interest income and all realized capital gains of
monies invested into the TOPS Fund. Requires the treasurer to report annually to the
legislature the amount of investment earnings credited to the TOPS fund.
Proposed law retains the Millennium Trust as a special fund within the state treasury.
Retains the Health Excellence Fund and the TOPS Fund, but repeals the Education
Excellence Fund. Provides for deposits as follows: (1) ½ of all dividend and interest income
and all realized capital gains of monies invested to the Health Excellence Fund; and (2)
100% (of the 75%) of the tobacco settlement proceeds deposited into the Millennium Trust
and ½ of all dividend and interest income and all realized capital gains of monies invested
into the TOPS fund. Repeals language regarding deposit and the distribution of monies in
the fund for prior fiscal years.
Present law provides for the investment of the Millennium Trust. Directs the treasurer to
invest monies in the trust in the same investments permitted for the LEQTF. Provides for
investment maturity and interest rates on certificates of deposit. Authorizes the treasurer to
enter into direct security repurchase agreements, reverse security repurchase agreements, and
securities lending contracts in order to generate passive income. Provides definition for
direct security repurchase agreements, reverse security repurchase agreements, and securities
lending contracts. Requires the treasurer to annually submit a report on the performance of
the trust to the Joint Legislative Committee on the Budget and the commissioner of
administration. Requires the treasurer to annually submit a report on the performance of the
Education Excellence Fund to the state superintendent of education.
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Proposed law provides for the investment of the Millennium Trust; however, proposed law
adds the types of investments allowable for monies in the LEQTF. Requires any investment
managers hired on a contract basis to advise the treasurer to be selected by the treasurer and
approved by the state bond commission. Removes the provision in present law that requires
submission of the annual report regarding the performance of the Education Excellence Fund
to the state superintendent of education. Retains all other provisions in present law.
Present law provides for appropriations from the subfunds within the Millennium Trust: (1)
the Education Excellence Fund; (2) the Health Excellence Fund; and (3) the TOPS fund.
Provides limitations to the amounts appropriated from the Education Excellence Fund, the
Health Excellence Fund, and the TOPS fund. Provides for specific purposes for monies
appropriated from the Health Excellence Fund, the Education Excellence Fund, and the
TOPS fund.
Proposed law retains provisions in present law regarding appropriations from the Health
Excellence Fund and the TOPS fund. Proposed law repeals prior year limitations on
amounts that may be appropriated from the funds.
Proposed law repeals provisions related to the allocations made to the Education Excellence
Fund and retains the provisions in present law regarding appropriations from the fund.
Proposed law repeals all provisions of the Education Excellence Fund effective July 1, 2027.
Louisiana Unclaimed Property Permanent Trust Fund
Present law creates a special fund in the state treasury called the Louisiana Unclaimed
Property Permanent Trust Fund. Prohibits appropriations from the fund. Provides for the
fund to ensure a source of payment for claims made by owners of unclaimed property.
Deposits into the fund derive from the amount of all monies received as a result of the
Uniform Unclaimed Property Act of 1997. Provides for realized capital gains, dividend
income, and interest income earned on the investments in the fund to be deposited into the
state general fund. Proposed law retains present law.
Present law directs the treasurer to invest monies in the trust in the same manner as
investments for the LEQTF.
Proposed law adds the types of investments allowable for monies in the LEQTF and allows
for contractors selected by the treasurer and approved by the bond commission to manage
fund assets.
Effectiveness
Repealed provisions of law become effective if and when the proposed amendment of Art.
7 of the Constitution of La. contained in the Act which originated as House Bill No. __ of
the 2025 Regular Session of the Legislature is adopted at a statewide election and becomes
effective.
(Amends R.S. 17:3801(A) and (C), 3802(A)(1), R.S. 39:98.1, 98.2(A) and (E), 98.3(A) and
(C)(introductory paragraph), and 100.161(B)(3); Repeals R.S. 17:3801 - 3805 and R.S.
39:98.3(C) and (E))
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