By: Elkins H.B. No. 3795
A BILL TO BE ENTITLED
AN ACT
relating to authorized investments for governmental entities.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 2256.003, Government Code, is amended by
adding a new Subsection (d) to read as follows:
Sec. 2256.003. Authority to Invest Funds; Entities Subject
to This Chapter
(a) Each governing body of the following entities may
purchase, sell, and invest its funds and funds under its control in
investments authorized under this subchapter in compliance with
investment policies approved by the governing body and according to
the standard of care prescribed by Section 2256.006:
(1) a local government;
(2) a state agency;
(3) a nonprofit corporation acting on behalf of a
local government or a state agency; or
(4) an investment pool acting on behalf of two or more
local governments, state agencies, or a combination of those
entities.
(b) In the exercise of its powers under Subsection (a), the
governing body of an investing entity may contract with an
investment management firm registered under the Investment
Advisers Act of 1940 (15 U.S.C. Section 80b-1 et seq.) or with the
State Securities Board to provide for the investment and management
of its public funds or other funds under its control. A contract
made under authority of this subsection may not be for a term longer
than two years. A renewal or extension of the contract must be made
by the governing body of the investing entity by order, ordinance,
or resolution.
(c) This chapter does not prohibit an investing entity or
investment officer from using the entity's employees or the
services of a contractor of the entity to aid the investment officer
in the execution of the officer's duties under this chapter.
(d) Notwithstanding any other law, each governing body must
invest a minimum five percent of their total portfolio in
Texas-based, publicly-traded corporations.
SECTION 2. EFFECTIVE DATE. This Act takes effect September
1, 2011.