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UTAH CODE (Last Updated: January 16, 2015) |
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Title 51. Public Funds and Accounts |
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Chapter 7. State Money Management Act |
§ 51-7-11. Authorized deposits or investments of public funds.
Latest version.
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(1) (a) Except as provided in Subsections (1)(b) and (1)(c), a public treasurer shall conduct investment transactions through qualified depositories, certified dealers, or directly with issuers of the investment securities. (b) A public treasurer may designate a certified investment adviser to make trades on behalf of the public treasurer. (c) A public treasurer may make a deposit in accordance with Section 53B-7-601 in a foreign depository institution as defined in Section 7-1-103. (2) The remaining term to maturity of the investment may not exceed the period of availability of the funds to be invested. (3) Except as provided in Subsection (4), all public funds shall be deposited or invested in the following assets that meet the criteria of Section 51-7-17: (a) negotiable or nonnegotiable deposits of qualified depositories; (c) qualifying repurchase agreements and reverse repurchase agreements with certified dealers, permitted depositories, or qualified depositories using collateral consisting of: (i) Government National Mortgage Association mortgage pools; (ii) Federal Home Loan Mortgage Corporation mortgage pools; (iii) Federal National Mortgage Corporation mortgage pools; (iv) Small Business Administration loan pools; or (v) other investments authorized by this section; (d) commercial paper that is classified as "first tier" by two nationally recognized statistical rating organizations, which has a remaining term to maturity of: (i) 270 days or fewer for paper issued under 15 U.S.C. Sec. 77c(a)(3); or (ii) 365 days or fewer for paper issued under 15 U.S.C. Sec. 77d(2); (e) bankers' acceptances that: (i) are eligible for discount at a Federal Reserve bank; and (ii) have a remaining term to maturity of 270 days or fewer; (f) fixed rate negotiable deposits issued by a permitted depository that have a remaining term to maturity of 365 days or fewer; (g) obligations of the United States Treasury, including United States Treasury bills, United States Treasury notes, and United States Treasury bonds; (h) obligations other than mortgage pools and other mortgage derivative products issued by, or fully guaranteed as to principal and interest by, the following agencies or instrumentalities of the United States in which a market is made by a primary reporting government securities dealer, unless the agency or instrumentality has become private and is no longer considered to be a government entity: (i) Federal Farm Credit banks; (ii) Federal Home Loan banks; (iii) Federal National Mortgage Association; (iv) Federal Home Loan Mortgage Corporation; (v) Federal Agriculture Mortgage Corporation; and (vi) Tennessee Valley Authority; (i) fixed rate corporate obligations that: (i) are rated "A" or higher or the equivalent of "A" or higher by two nationally recognized statistical rating organizations; (ii) are senior unsecured or secured obligations of the issuer, excluding covered bonds; (iii) are publicly traded; and (iv) have a remaining term to final maturity of 15 months or less or are subject to a hard put at par value or better, within 365 days; (j) tax anticipation notes and general obligation bonds of the state or a county, incorporated city or town, school district, or other political subdivision of the state, including bonds offered on a when-issued basis without regard to the limitations in Subsection (7); (k) bonds, notes, or other evidence of indebtedness of a county, incorporated city or town, school district, or other political subdivision of the state that are payable from assessments or from revenues or earnings specifically pledged for payment of the principal and interest on these obligations, including bonds offered on a when-issued basis without regard to the limitations in Subsection (7); (l) shares or certificates in a money market mutual fund; (m) variable rate negotiable deposits that: (i) are issued by a qualified depository or a permitted depository; (ii) are repriced at least semiannually; and (iii) have a remaining term to final maturity not to exceed three years; (n) variable rate securities that: (i) (A) are rated "A" or higher or the equivalent of "A" or higher by two nationally recognized statistical rating organizations; (B) are senior unsecured or secured obligations of the issuer, excluding covered bonds; (C) are publicly traded; (D) are repriced at least semiannually; and (E) have a remaining term to final maturity not to exceed three years or are subject to a hard put at par value or better, within 365 days; (ii) are not mortgages, mortgage-backed securities, mortgage derivative products, or a security making unscheduled periodic principal payments other than optional redemptions; and (o) reciprocal deposits made in accordance with Subsection 51-7-17(4). (4) The following public funds are exempt from the requirements of Subsection (3): (a) the Employers' Reinsurance Fund created in Section 34A-2-702; (b) the Uninsured Employers' Fund created in Section 34A-2-704; (c) a local government other post-employment benefits trust fund under Section 51-7-12.2; and (d) a nonnegotiable deposit made in accordance with Section 53B-7-601 in a foreign depository institution as defined in Section 7-1-103. (5) If any of the deposits authorized by Subsection (3)(a) are negotiable or nonnegotiable large time deposits issued in amounts of $100,000 or more, the interest shall be calculated on the basis of the actual number of days divided by 360 days. (6) A public treasurer may maintain fully insured deposits in demand accounts in a federally insured nonqualified depository only if a qualified depository is not reasonably convenient to the entity's geographic location. (7) Except as provided under Subsections (3)(j) and (k), the public treasurer shall ensure that all purchases and sales of securities are settled within: (a) 15 days of the trade date for outstanding issues; and (b) 30 days for new issues.