Chapter 871
AN ACT
HB 2901
Relating to public funds; creating new provisions; amending ORS
182.470, 284.365, 294.847, 295.005, 295.008, 295.015, 295.018, 295.025,
295.027, 295.035, 295.055, 295.115, 295.205, 377.840, 576.375, 706.720, 708A.535
and 711.410; repealing ORS 295.045, 295.065, 295.085, 295.105, 295.125, 295.175
and 295.185; appropriating money; and limiting expenditures.
Be It Enacted by the People of
the State of
SECTION 1. ORS 295.027 and sections 2 to 14 of this 2007
Act are added to and made a part of ORS 295.005 to 295.165.
SECTION 2. (1) Within five business days after the
State Treasurer receives notice from a custodian pursuant to ORS 295.035 (2)(e) indicating that a bank depository has failed to pledge
adequate collateral with its custodian, the treasurer shall send written notice
of the failure to each public official who has public funds on deposit in the
bank depository with respect to which the notice under ORS 295.035 (2)(e) was
given.
(2) Within five business
days after the State Treasurer receives notice from a custodian pursuant to ORS
295.035 (2)(f) indicating that a bank depository has
once again pledged adequate collateral with its custodian, the treasurer shall
send written notice to each public official who was notified under subsection
(1) of this section stating that the bank depository once again has adequate
collateral.
SECTION 3. (1) Within 20 business days after a public
official receives a notice from the State Treasurer pursuant to ORS 295.018
(5)(a) or section 2 (1) of this 2007 Act, the public official shall withdraw
from the bank depository to which the notice applies all public funds deposits
except those deposits that are insured by the Federal Deposit Insurance
Corporation.
(2) If a public official
receives a notice from the State Treasurer pursuant to ORS 295.018 (5)(a) or
section 2 (1) of this 2007 Act, beginning 20 business days after the public
official receives the notice, the public official may not deposit into the bank
depository to which the notice applies any public funds deposits if, as a
result of such a deposit, the total public funds of the public official on
deposit with the bank depository exceed the deposit insurance limit of the
Federal Deposit Insurance Corporation. The prohibition on deposits continues
until the public official receives notice under ORS 295.018 (5)(b) or section 2
(2) of this 2007 Act indicating that the bank depository is in compliance with
ORS 295.018 or 295.035, as applicable.
(3) Except as required
by any applicable law or regulation, a bank depository may not impose any early
withdrawal penalty or any forfeiture of interest with respect to a withdrawal
made by a public official pursuant to this section.
SECTION 4. (1) The deposit of securities by a bank
depository with its custodian pursuant to ORS 295.005 to 295.165 constitutes
consent by the bank depository to the disposition of the securities in
accordance with this section.
(2) When a loss has
occurred in a bank depository, the bank depository shall as soon as possible
make payment to the proper public officials of all funds subject to the loss,
pursuant to the following procedures:
(a) The Director of the
Department of Consumer and Business Services or the receiver shall, within 20
days after the issuance of a restraining order or taking possession of any bank
depository, ascertain the amount of public funds on deposit in the bank
depository as disclosed by its records and the amount of the public funds
covered by deposit insurance and certify the amounts to the State Treasurer and
to each public official who has public funds on deposit in the bank depository.
(b) Each public official
who has public funds on deposit in the bank depository shall, within 10 days
after receipt of the certification from the Director of the Department of
Consumer and Business Services or the receiver, furnish to the State Treasurer
verified statements of the public funds that the public official has on deposit
in the bank depository.
(3) Upon receipt of the
certification from the Director of the Department of Consumer and Business
Services or the receiver and the verified statements from the public officials
who have public funds on deposit in the bank depository, the State Treasurer
shall ascertain and fix the amount of public funds on deposit in the bank
depository, plus interest to the date the funds are distributed to the public
official at the rate the bank depository agreed to pay on the funds, minus any
amount covered by deposit insurance.
(4) After making the
calculation described in subsection (3) of this section, the State Treasurer
shall assess the net amount of public funds against all bank depositories, as
follows:
(a) First, against the
bank depository that suffered the loss, to the extent of the full value of its
collateral deposited with its custodian pursuant to ORS 295.005 to 295.165; and
(b) Second, against the
collateral of all other bank depositories, on a proportionate basis determined
as provided in subsection (5) of this section.
(5) For purposes of
subsection (4) of this section, the proportionate share of each of the other
bank depositories shall be determined by:
(a) Averaging the
amounts of the total public funds deposits reported on the bank depository’s
last four treasurer reports;
(b) Averaging the total
amounts of the total public funds deposits reported on the last four treasurer
reports of all of the bank depositories; and
(c) Dividing the result
of the calculation performed under paragraph (a) of this subsection by the result
of the calculation performed under paragraph (b) of this subsection.
(6) Notwithstanding the
assessment provisions of subsection (4) of this section, the State Treasurer
shall assess the net amount of public funds deposits of a public official only
against the bank depository that suffered the loss, and not against the
collateral of other bank depositories, if the public official:
(a) Was given
appropriate notice about the bank depository by the State Treasurer under
section 2 (1) of this 2007 Act or ORS 295.018 (5)(a);
and
(b) The public official
did not comply with section 3 of this 2007 Act.
(7) Assessments made by
the State Treasurer are payable on the fifth business day following demand. If
any bank depository fails to pay its assessment, the State Treasurer shall take
possession of the securities segregated as collateral by the bank depository
and liquidate the securities for the purpose of paying the assessment.
(8) The State Treasurer
shall distribute the net proceeds of the assessments and of any liquidated
collateral, to the extent that they do not exceed the total net amount of
public funds deposits and accrued interest claimed by the public officials,
among the public officials entitled to the proceeds in proportion to the public
officials’ respective claims.
(9) If the net proceeds
of the assessments and of any liquidated collateral are inadequate, after all
other available sources are applied, to meet the total claims of the public
officials entitled to the proceeds, the public officials may make claims
against the closed bank depository as general creditors.
(10) The prohibition on
transfers of assets set forth in ORS 711.410 does not apply to assessments,
payments, transfers or sales of securities made pursuant to this section.
SECTION 5. The State Treasurer may charge bank
depositories for the reasonable expenses of the State Treasurer in connection
with the services, duties and activities of the State Treasurer related to ORS
295.005 to 295.165. The State Treasurer shall deposit all moneys received under
this section in the Miscellaneous Receipts Account established in the General
Fund for the State Treasurer. Moneys received under this section are
continuously appropriated to the State Treasurer for the payment of the
reasonable expenses of the State Treasurer in connection with the services,
duties and activities of the State Treasurer related to ORS 295.005 to 295.165.
A bank depository shall pay to the State Treasurer all fees and other amounts
charged under this section or under rules adopted to implement this section.
SECTION 6. Upon the distribution of the proceeds of
assessments and liquidated collateral pursuant to section 4 of this 2007 Act by
the State Treasurer to any public official, the State Treasurer shall be
subrogated to all of the right, title and interest of the public official
against the closed bank depository, and shall share in any distribution of its
assets ratably with other depositors. Any sums received from any distribution
shall be paid to the public officials to the extent of any unpaid net deposit
liability and the balance remaining shall be paid to the bank depositories
against which the assessments were made, pro rata in proportion to the
assessments actually paid by each bank depository. However, the closed bank
depository may not share in any distribution of the balance remaining. If the
State Treasurer incurs expenses in enforcing the treasurer’s rights under this
section, the expenses may be charged as provided in section 5 of this 2007 Act.
The State Treasurer shall submit a claim for expenses to the bank depository,
and if the charges are thereafter paid to the treasurer, they shall be treated
as a liquidation expense of the closed bank depository.
SECTION 7. (1) On or before each treasurer report due
date, each bank depository that has in its possession public funds deposits of
one or more public officials that exceed the limits specified in ORS 295.025
shall file its treasurer report with its custodian bank and with the State
Treasurer.
(2) Each bank depository
that files reports with the State Treasurer under subsection (1) of this
section shall notify the State Treasurer in writing or by electronic means
within 10 business days of:
(a) The date on which
the bank depository’s net worth is reduced by an amount greater than 10 percent
of the amount shown as its net worth on the most recent report submitted
pursuant to subsection (1) of this section; or
(b) The date on which
the bank depository ceases to be well capitalized and becomes adequately
capitalized or undercapitalized, or ceases to be adequately capitalized and
becomes undercapitalized.
(3) An undercapitalized
bank depository shall report the actual amount of public funds deposits held by
it at least weekly to its custodian bank and to the State Treasurer.
SECTION 8. (1) The State Treasurer may request that the
Director of the Department of Consumer and Business Services or another state
or federal agency with primary regulatory authority over any financial
institution that is a bank depository or that applies to become a bank
depository investigate and report to the State Treasurer concerning the
condition of the financial institution.
(2) The financial
institution examined under this section shall pay the expenses of the
investigation and report.
(3) In lieu of an
investigation and report, the State Treasurer may rely upon information made
available to the State Treasurer or the Director of the Department of Consumer
and Business Services by the Office of the Comptroller of the Currency, the
Office of Thrift Supervision, the Federal Deposit Insurance Corporation, the
Board of Governors of the Federal Reserve System or any state bank or thrift
regulatory agency.
SECTION 9. The Director of the Department of Consumer
and Business Services shall advise the State Treasurer of any action the
director takes or directs any bank depository to take that will result in a
reduction of greater than 10 percent of the net worth of the bank depository as
shown on the most recent treasurer report submitted pursuant to section 7 of
this 2007 Act.
SECTION 10. (1) A bank depository may not accept a
deposit of public funds if the deposit would cause the aggregate of public
funds deposits made by any one public official in the bank depository to exceed
at any time the net worth of the bank depository. If a bank depository’s net
worth is reduced, the bank depository may allow public funds on deposit in
excess of the reduced net worth to remain if the bank depository deposits with
its custodian eligible securities valued at market value in an amount at least
equal to the amount of the excess public funds deposits. If the additional
securities required by this section are not deposited with the custodian, the
bank depository shall permit the public official to withdraw deposits prior to
maturity, including accrued interest, in accordance with applicable statutes
and governmental regulations.
(2) The limitations of
subsection (1) of this section do not apply to public funds deposits held by a
bank depository in a certificate of deposit or time deposit under the program
described in ORS 295.027.
SECTION 11. (1) Notwithstanding section 10 of this 2007
Act, a bank depository may not permit the aggregate of public funds deposits on
deposit with the bank depository from all public officials to exceed at any
time:
(a) 100 percent of the
value of the bank depository’s net worth, if the bank depository is an
undercapitalized bank depository;
(b) 150 percent of the
value of the bank depository’s net worth, if the bank depository is an
adequately capitalized bank depository;
(c) 200 percent of the
value of the bank depository’s net worth, if the bank depository is a well
capitalized bank depository; or
(d) 30 percent of the
total aggregate public funds deposits of all public officials in all bank
depositories as reported in the most recent notice received by the bank
depository from the State Treasurer.
(2) The State Treasurer
shall notify each bank depository and its custodian of the total aggregate
public funds deposits of all public officials in all bank depositories, based
on the most recently submitted treasurer reports. The treasurer shall give the
notification required by this subsection by the last day of the month in which
bank depositories are required to submit a treasurer report.
(3) If a bank depository’s
aggregate of public funds deposits exceeds the amount set forth in subsection
(1) of this section, the bank depository shall, not later than 20 business days
after receipt of notice from the State Treasurer, cease accepting deposits of
public funds.
(4) Notwithstanding
subsections (1) and (3) of this section:
(a) A bank depository
may accept and hold public funds deposits in excess of the limits provided in
subsection (1) of this section if the State Treasurer, upon good cause shown,
approves the request of the bank depository to hold public funds in excess of
the limits provided in subsection (1) of this section for a period not
exceeding 90 days.
(b) The limitations of
subsection (1) of this section do not apply to public funds deposits held by a
bank depository in a program described in ORS 295.027.
(c) A well capitalized
bank depository or an adequately capitalized bank depository may accept and
hold public funds deposits in excess of the limit provided in subsection (1)(d) of this section if eligible securities are deposited
with the bank depository’s custodian as collateral in an amount at least equal
to the amount of the public funds deposits in excess of the limitation
prescribed in subsection (1)(d) of this section.
SECTION 12. When public funds deposits are made in
accordance with ORS 295.005 to 295.165, a public official may not be held
liable for any loss of public funds that results from the failure or default of
any depository without fault or neglect on the public official’s part or on the
part of the public official’s officers or employees.
SECTION 13. (1) If a bank depository ceases holding
public funds deposits, the bank depository’s custodian shall continue to hold
the pledged securities of the bank depository as collateral pursuant to ORS
295.005 to 295.165. Unless the State Treasurer directs that the bank depository’s
securities be held for a longer period, the custodian shall hold the bank
depository’s pledged securities for a period of:
(a) 30 days, in the case
of a bank depository that was well capitalized as of the date the bank
depository ceased holding any public funds deposits;
(b) 90 days, in the case
of a bank depository that was adequately capitalized as of the date the bank
depository ceased holding any public funds deposits; or
(c) One year, in the
case of a bank depository that was undercapitalized as of the date the bank
depository ceased holding any public funds deposits.
(2) If any of a bank
depository’s pledged securities mature during the periods described in
subsection (1) of this section, the bank depository shall pledge substitute
securities that shall be held by its custodian until the expiration of the
period.
(3) At the end of the
applicable holding period, if the bank depository has not, during that period,
had on deposit any public funds deposits, the custodian shall tender the bank
depository’s securities to the bank depository.
(4) Notwithstanding the
release of a bank depository’s securities pursuant to subsection (3) of this
section, the bank depository shall continue to be treated as a bank depository
and shall be subject to assessment under section 4 of this 2007 Act until one
year after the bank depository ceased holding any public funds deposits. If the
bank depository no longer has pledged collateral that may be used to pay the
assessment, the bank depository shall remain liable for payment of the
assessment from its other assets.
SECTION 14. (1) The State Treasurer shall adopt rules
implementing the provisions of ORS 295.005 to 295.165.
(2) The State Treasurer
shall design the treasurer report required by section 7 of this 2007 Act. The
report shall be designed to minimize the regulatory burden of completing and
submitting the report and, to the greatest extent practicable, the form of the
report and the content required in the report shall be consistent with the
information required by the bank depository’s report of condition and income.
SECTION 15. ORS 295.005 is amended to read:
295.005. As used in ORS
295.005 to 295.165, unless the context requires otherwise:
[(1) “Certificate of participation” or “certificate” means a
nonnegotiable document issued by a pool manager to a public official.]
(1) “Adequately
capitalized” means a bank depository that is classified as adequately
capitalized by its primary federal regulatory authority.
(2) “Bank depository”
means an insured institution or trust company that:
(a) Maintains a head
office or branch in this state in the capacity of an insured institution or
trust company; and
(b) Complies with ORS
295.008.
(3) “Business day” means
any day other than a federal or State of Oregon legal holiday or a day on which
offices of the State of Oregon are otherwise authorized by law to remain
closed.
(4) “Credit union
depository” means a credit union as defined in ORS 723.006 or a federal credit
union if:
(a) The shares and
deposits of the credit union or federal credit union are insured by the
National Credit Union Share Insurance Fund; and
(b) The credit union or
federal credit union maintains a head office or branch in this state in the
capacity of a credit union or federal credit union.
[(2)] (5) “Custodian bank” or “custodian” means one of
the following institutions designated by the bank depository [bank] for its own account:
[(a) The Federal Reserve Bank designated to
serve this state, or any branch of that bank;]
[(b)] (a) The Federal Home Loan Bank designated to serve this
state, or any branch of that bank; or
[(c)] (b) Any insured institution or
trust company[, as those terms are
defined in ORS 706.008,] that:
(A) Is authorized to accept deposits or transact
trust business in this state; [and
that]
(B) Complies with
ORS 295.008; and
(C) Has been approved
by the State Treasurer to serve as a custodian bank, if the State Treasurer has
approved custodians under ORS 295.008.
[(d) The fiscal agency of the State of Oregon, duly appointed and acting
as such agency pursuant to ORS 288.010 to 288.110.]
[(3)] (6) “Custodian’s receipt” or “receipt” means a document
issued by a custodian bank [to a pool
manager] describing the securities deposited with it by a bank
depository [bank] to secure public
fund deposits.
[(4)] (7) [“Depository
bank” or] “Depository” means a bank depository or a credit union depository.
[an insured institution or trust company,
as those terms are defined in ORS 706.008, a credit union, as defined in ORS
723.006, the shares and deposits of which are insured by the National Credit
Union Share Insurance Fund, or a federal credit union, if the institution,
trust company or credit union:]
[(a) Maintains a head office or a branch in this state in the capacity
of an insured institution, trust company, credit union or federal credit union;
and]
[(b) In the case of an insured institution or trust company, complies
with ORS 295.008.]
[(5) “Pool manager” means:]
[(a) The State Treasurer;]
[(b) Any insured institution or trust company, as those terms are
defined in ORS 706.008, a credit union, as defined in ORS 723.006, the shares
and deposits of which are insured by the National Credit Union Share Insurance
Fund, or a federal credit union, if the institution, trust company or credit
union:]
[(A) Is authorized to accept deposits or
transact trust business in this state; and]
[(B) In the case of an insured institution or trust company, complies
with ORS 295.008;]
[(c) The Federal Reserve Bank designated to serve this state, or any
branch of that bank; or]
[(d) The Federal Home Loan Bank designated to serve this state, or any
branch of that bank.]
(8) “Financial
institution outside this state” means a financial institution, as defined in
ORS 706.008, that is not an extranational institution, as defined in ORS
706.008, and is not a bank depository or credit union depository, as defined in
this section.
(9) “Insured institution”
means an insured institution as defined in ORS 706.008.
(10) “Loss” means the
issuance of an order by a regulatory or supervisory authority or a court of
competent jurisdiction:
(a)
Restraining a bank depository from making payments of deposit liabilities; or
(b) Appointing a
receiver for a public depository.
(11) “Maximum liability”
of a bank depository on any given date means a sum equal to:
(a) For a well
capitalized bank depository, 10 percent of the greater of:
(A) All public funds
held by the bank depository, as shown on the most recent treasurer report;
(B) The average of the
balances of public funds held by the bank depository, as shown on the last four
immediately preceding treasurer reports; or
(C) An amount otherwise
prescribed in ORS 295.005 to 295.165.
(b) For an adequately
capitalized bank depository, 25 percent of the greater of:
(A) All public funds
held by the bank depository, as shown on the most recent treasurer report;
(B) The average of the
balances of public funds held by the bank depository, as shown on the last four
immediately preceding treasurer reports; or
(C) An amount otherwise
prescribed in ORS 295.005 to 295.165.
(c) For an
undercapitalized bank depository, 110 percent of the greater of:
(A) All public funds
held by the bank depository; or
(B) The average of the
balances of public funds held by the bank depository, as shown on the last four
immediately preceding treasurer reports.
(12) “Net worth” of a
bank depository means:
(a) The equity capital
of the bank depository, as shown on the immediately preceding report of
condition and income, and may include capital notes and debentures that are
subordinate to the interests of depositors; or
(b) An amount of equity
capital designated by the State Treasurer.
(13) “Pledge agreement”
means a written agreement among an insured institution or trust company, the
State Treasurer and a custodian that pledges the securities deposited by the
insured institution or trust company with the custodian as collateral for
deposits of public funds held by the insured institution or trust company. The
agreement must be approved by the board of directors or loan committee of the
insured institution or trust company and must be continuously maintained as a
written record of the insured institution or trust company.
[(6)] (14) “Public funds” or “funds” means
funds under the control or in the custody of a public official by virtue of
office.
(15) “Public official”
means each officer or employee of this state or any agency, political
subdivision or public or municipal corporation
thereof, or any housing authority, who by law is made the custodian of or has
control of any public funds.
(16) “Report of
condition and income” means the quarterly report submitted to a bank depository’s
primary federal regulatory authority.
[(7)] (17) “Security” or “securities” means:
(a) Obligations of the
(b) Obligations of the
International Bank for Reconstruction and Development;
(c) Bonds of any state
of the
(A) That are rated in
one of the four highest grades by a recognized investment service organization
that has been engaged regularly and continuously for a period of not less than
10 years in rating state and municipal bonds; or
(B) Having once been so
rated are ruled to be eligible securities for the
purposes of ORS 295.005 to 295.165, notwithstanding the loss of such rating;
(d) Bonds of any county,
city, school district, port district or other public body in the United States
payable from or secured by ad valorem taxes [levied generally on substantially all property within the issuing body]
and that meet the rating requirement or are ruled to be eligible securities as
provided in paragraph (c) of this subsection;
(e) Bonds of any county,
city, school district, port district or other public body issued pursuant to
the Constitution or statutes of the State of Oregon or the charter or ordinances
of any county or city within the State of Oregon, if the issuing body has not
been in default with respect to the payment of principal or interest on any of
its bonds within the preceding 10 years or during the period of its existence
if that is less than 10 years;
(f) With the
permission of the State Treasurer and in accordance with rules adopted by the
State Treasurer, loans made to any county, city, school district, port district
or other public body in the State of Oregon, if the borrower has not been in
default with respect to the payment of principal or interest on any of its
loans within the preceding 10 years or during the period of its existence if
that is less than 10 years;
[(f)] (g) With the permission of the State Treasurer and in accordance
with rules adopted by the State Treasurer, bond anticipation notes issued,
sold or assumed by an authority under ORS 441.560;
[(g) One-family to four-family housing mortgage loan notes related to
property situated in the State of Oregon, which are owned by a depository bank,
no payment on which is more than 90 days past due, and which are eligible
collateral for loans from the Federal Reserve Bank of San Francisco under
section 10(b) of the Federal Reserve Act and regulations thereunder;]
(h) Bonds, notes,
letters of credit or other securities or evidence of indebtedness constituting
the direct and general obligation of a federal home loan bank or Federal
Reserve bank;
(i) Debt obligations of
domestic corporations that are rated in one of the three highest grades by a
recognized investment service organization that has been engaged regularly and
continuously for a period of not less than 10 years in rating corporate debt
obligations; and
(j) Collateralized
mortgage obligations and real estate mortgage investment conduits that are
rated in one of the two highest grades by a recognized investment service
organization that has been engaged regularly and continuously for a period of
not less than 10 years in rating corporate debt obligations[; and].
[(k) One-family to four-family housing mortgages that have been secured
by means of a guarantee as to full repayment of principal and interest by an
agency of the United States Government, including the Government National
Mortgage Association, the Federal National Mortgage Association and the Federal
Home Loan Mortgage Corporation.]
[(8) “Public official” means each officer or employee of this state or
any agency, political subdivision or public or municipal corporation thereof
who by law is made the custodian of or has control of any public funds.]
(18) “Treasurer
report” means a written report signed or authenticated by an officer of a bank
depository setting forth as of the close of business on a specified date:
(a) The total amount of
public funds on deposit with the bank depository;
(b) The net worth of the
bank depository;
(c) The amount and
nature of eligible collateral then on deposit with its custodian to
collateralize the bank depository’s public funds deposits; and
(d) The identity of its
custodian.
(19) “Treasurer report
due date” means a date not less than 10 business days after the date a bank
depository’s report of condition and income is due to be submitted to its
federal regulatory authority.
(20) “Trust company”
means a trust company as defined in ORS 706.008.
(21) “Undercapitalized”
means a bank depository that is classified as undercapitalized by its primary
federal regulatory authority.
[(9)] (22) “Value” means the current market value of
securities.
(23) “Well
capitalized” means a bank depository that is classified as well capitalized by
its primary federal regulatory authority.
SECTION 15a. If House Bill 3265 becomes law, section 15
of this 2007 Act (amending ORS 295.005) is repealed and ORS 295.005, as amended
by section 123, chapter 783, Oregon Laws 2007 (Enrolled House Bill 3265), is
amended to read:
295.005. As used in ORS
295.005 to 295.165, unless the context requires otherwise:
[(1) “Certificate of participation” or “certificate” means a
nonnegotiable document issued by a pool manager to a public official.]
(1) “Adequately
capitalized” means a bank depository that is classified as adequately
capitalized by its primary federal regulatory authority.
(2) “Bank depository”
means an insured institution or trust company that:
(a) Maintains a head
office or branch in this state in the capacity of an insured institution or
trust company; and
(b) Complies with ORS
295.008.
(3) “Business day” means
any day other than a federal or State of Oregon legal holiday or a day on which
offices of the State of Oregon are otherwise authorized by law to remain
closed.
(4) “Credit union
depository” means a credit union as defined in ORS 723.006 or a federal credit
union if:
(a) The shares and
deposits of the credit union or federal credit union are insured by the
National Credit Union Share Insurance Fund; and
(b) The credit union or
federal credit union maintains a head office or branch in this state in the
capacity of a credit union or federal credit union.
[(2)] (5) “Custodian bank” or “custodian” means one of
the following institutions designated by the bank depository [bank] for its own account:
[(a) The Federal Reserve Bank designated to
serve this state, or any branch of that bank;]
[(b)] (a) The Federal Home Loan Bank designated to serve this
state, or any branch of that bank; or
[(c)] (b) Any insured institution or
trust company[, as those terms are
defined in ORS 706.008,] that:
(A) Is authorized to accept deposits or transact
trust business in this state; [and
that]
(B) Complies with
ORS 295.008; and
(C) Has been approved
by the State Treasurer to serve as a custodian bank, if the State Treasurer has
approved custodians under ORS 295.008.
[(d) The fiscal agency of the State of Oregon, duly appointed and acting
as such agency pursuant to section 21 of this 2007 Act.]
[(3)] (6) “Custodian’s receipt” or “receipt” means a document
issued by a custodian bank [to a pool
manager] describing the securities deposited with it by a bank
depository [bank] to secure public
fund deposits.
[(4)] (7) [“Depository
bank” or] “Depository” means a bank depository or a credit union
depository. [an insured institution
or trust company, as those terms are defined in ORS 706.008, a credit union, as
defined in ORS 723.006, the shares and deposits of which are insured by the
National Credit Union Share Insurance Fund, or a federal credit union, if the
institution, trust company or credit union:]
[(a) Maintains a head office or a branch in this state in the capacity
of an insured institution, trust company, credit union or federal credit union;
and]
[(b) In the case of an insured institution or trust company, complies
with ORS 295.008.]
[(5) “Pool manager” means:]
[(a) The State Treasurer;]
[(b) Any insured institution or trust company, as those terms are
defined in ORS 706.008, a credit union, as defined in ORS 723.006, the shares
and deposits of which are insured by the National Credit Union Share Insurance
Fund, or a federal credit union, if the institution, trust company or credit
union:]
[(A) Is authorized to accept deposits or
transact trust business in this state; and]
[(B) In the case of an insured institution or trust company, complies
with ORS 295.008;]
[(c) The Federal Reserve Bank designated to serve this state, or any
branch of that bank; or]
[(d) The Federal Home Loan Bank designated to serve this state, or any
branch of that bank.]
(8) “Financial
institution outside this state” means a financial institution, as defined in
ORS 706.008, that is not an extranational institution, as defined in ORS
706.008, and is not a bank depository or credit union depository, as defined in
this section.
(9) “Insured institution”
means an insured institution as defined in ORS 706.008.
(10) “Loss” means the
issuance of an order by a regulatory or supervisory authority or a court of
competent jurisdiction:
(a)
Restraining a bank depository from making payments of deposit liabilities; or
(b) Appointing a
receiver for a public depository.
(11) “Maximum liability”
of a bank depository on any given date means a sum equal to:
(a) For a well
capitalized bank depository, 10 percent of the greater of:
(A) All public funds
held by the bank depository, as shown on the most recent treasurer report;
(B) The average of the
balances of public funds held by the bank depository, as shown on the last four
immediately preceding treasurer reports; or
(C) An amount otherwise
prescribed in ORS 295.005 to 295.165.
(b) For an adequately
capitalized bank depository, 25 percent of the greater of:
(A) All public funds held
by the bank depository, as shown on the most recent treasurer report;
(B) The average of the
balances of public funds held by the bank depository, as shown on the last four
immediately preceding treasurer reports; or
(C) An amount otherwise
prescribed in ORS 295.005 to 295.165.
(c) For an
undercapitalized bank depository, 110 percent of the greater of:
(A) All public funds
held by the bank depository; or
(B) The average of the
balances of public funds held by the bank depository, as shown on the last four
immediately preceding treasurer reports.
(12) “Net worth” of a
bank depository means:
(a) The equity capital
of the bank depository, as shown on the immediately preceding report of
condition and income, and may include capital notes and debentures that are
subordinate to the interests of depositors; or
(b) An amount of equity
capital designated by the State Treasurer.
(13) “Pledge agreement”
means a written agreement among an insured institution or trust company, the
State Treasurer and a custodian that pledges the securities deposited by the
insured institution or trust company with the custodian as collateral for
deposits of public funds held by the insured institution or trust company. The
agreement must be approved by the board of directors or loan committee of the
insured institution or trust company and must be continuously maintained as a
written record of the insured institution or trust company.
[(6)] (14) “Public funds” or “funds” means
funds under the control or in the custody of a public official by virtue of
office.
(15) “Public official”
means each officer or employee of this state or any agency, political
subdivision or public or municipal corporation
thereof, or any housing authority, who by law is made the custodian of or has
control of any public funds.
(16) “Report of
condition and income” means the quarterly report submitted to a bank depository’s
primary federal regulatory authority.
[(7)] (17) “Security” or “securities” means:
(a) Obligations of the
(b) Obligations of the
International Bank for Reconstruction and Development;
(c) Bonds of any state
of the
(A) That are rated in
one of the four highest grades by a recognized investment service organization
that has been engaged regularly and continuously for a period of not less than
10 years in rating state and municipal bonds; or
(B) Having once been so
rated are ruled to be eligible securities for the
purposes of ORS 295.005 to 295.165, notwithstanding the loss of such rating;
(d) Bonds of any county,
city, school district, port district or other public body in the United States
payable from or secured by ad valorem taxes [levied generally on substantially all property within the issuing body]
and that meet the rating requirement or are ruled to be eligible securities as
provided in paragraph (c) of this subsection;
(e) Bonds of any county,
city, school district, port district or other public body issued pursuant to
the Constitution or statutes of the State of Oregon or the charter or
ordinances of any county or city within the State of Oregon, if the issuing
body has not been in default with respect to the payment of principal or
interest on any of its bonds within the preceding 10 years or during the period
of its existence if that is less than 10 years;
(f) With the
permission of the State Treasurer and in accordance with rules adopted by the
State Treasurer, loans made to any county, city, school district, port district
or other public body in the State of Oregon, if the borrower has not been in
default with respect to the payment of principal or interest on any of its
loans within the preceding 10 years or during the period of its existence if
that is less than 10 years;
[(f)] (g) With the permission of the State Treasurer and in
accordance with rules adopted by the State Treasurer, bond anticipation
notes issued, sold or assumed by an authority under ORS 441.560;
[(g) One-family to four-family housing mortgage loan notes related to
property situated in the State of Oregon, which are owned by a depository bank,
no payment on which is more than 90 days past due, and which are eligible
collateral for loans from the Federal Reserve Bank of San Francisco under
section 10(b) of the Federal Reserve Act and regulations thereunder;]
(h) Bonds, notes,
letters of credit or other securities or evidence of indebtedness constituting
the direct and general obligation of a federal home loan bank or Federal Reserve
bank;
(i) Debt obligations of
domestic corporations that are rated in one of the three highest grades by a
recognized investment service organization that has been engaged regularly and
continuously for a period of not less than 10 years in rating corporate debt
obligations; and
(j) Collateralized
mortgage obligations and real estate mortgage investment conduits that are
rated in one of the two highest grades by a recognized investment service
organization that has been engaged regularly and continuously for a period of
not less than 10 years in rating corporate debt obligations[; and].
[(k) One-family to four-family housing mortgages that have been secured
by means of a guarantee as to full repayment of principal and interest by an
agency of the United States Government, including the Government National
Mortgage Association, the Federal National Mortgage Association and the Federal
Home Loan Mortgage Corporation.]
[(8) “Public official” means each officer or employee of this state or
any agency, political subdivision or public or municipal corporation thereof
who by law is made the custodian of or has control of any public funds.]
(18) “Treasurer
report” means a written report signed or authenticated by an officer of a bank
depository setting forth as of the close of business on a specified date:
(a) The total amount of
public funds on deposit with the bank depository;
(b) The net worth of the
bank depository;
(c) The amount and
nature of eligible collateral then on deposit with its custodian to
collateralize the bank depository’s public funds deposits; and
(d) The identity of its
custodian.
(19) “Treasurer report
due date” means a date not less than 10 business days after the date a bank
depository’s report of condition and income is due to be submitted to its
federal regulatory authority.
(20) “Trust company”
means a trust company as defined in ORS 706.008.
(21) “Undercapitalized”
means a bank depository that is classified as undercapitalized by its primary
federal regulatory authority.
[(9)] (22) “Value” means the current market value of
securities.
(23) “Well
capitalized” means a bank depository that is classified as well capitalized by
its primary federal regulatory authority.
SECTION 16. ORS 295.008 is amended to read:
295.008. (1)(a) An
insured institution or trust company [described
in ORS 295.005 (2)(c)] may not be a custodian bank under ORS 295.005 to
295.165, unless it certifies in writing to the State Treasurer that it will
furnish the reports required under ORS 714.075 to the Director of the
Department of Consumer and Business Services.
[(b) With the approval of the State Treasurer, a depository bank may be
a custodian bank with respect to its own securities.]
(b) The State
Treasurer may approve one or more insured institutions or trust companies to
serve as custodians for bank depositories. The State Treasurer shall promptly
notify all bank depositories of the approval of an insured institution or trust
company to serve as a custodian.
(2) An insured
institution or trust company [described
in ORS 295.005 (4)] may not be a bank depository [bank] under ORS 295.005 to 295.165,
unless it:
(a) Certifies in writing
to the State Treasurer that it will furnish the reports required under ORS
714.075 to the Director of the Department of Consumer and Business Services; [and]
(b) Except as provided
in subsection [(3)] (4) of
this section, enters into a [written
agreement with the State Treasurer and a custodian that pledges the securities
deposited by the insured institution or trust company with the custodian as
collateral for deposits of public funds held by the insured institution or
trust company. The agreement must be approved by the board of directors or loan
committee of the insured institution or trust company and shall be continuously
maintained as a written record of the insured institution or trust company.]
pledge agreement; and
(c)
Complies with subsection (3) of this section.
(3) After the operative
date of sections 1 to 14 of this 2007 Act, any insured institution or trust
company that is not acting as a bank depository on the operative date of
sections 1 to 14 of this 2007 Act and that wishes to become a bank depository
shall file with the State Treasurer an initial written report signed or
authenticated by an officer of the insured institution or trust company setting
forth, as of the date the insured institution or trust company intends to
commence acting as a bank depository:
(a) The estimated total
amount of public funds that will be on deposit with the insured institution or
trust company;
(b) The estimated net
worth of the insured institution or trust company;
(c) The amount and
nature of the collateral that will be deposited with its custodian to
collateralize the public funds deposits; and
(d) The identity of its
custodian.
[(3)] (4) An insured institution or trust company [described in ORS 295.005 (4)] may be a bank
depository [bank] under ORS 295.005
to 295.165 without entering into [the]
a pledge agreement [described in
subsection (2) of this section] or complying with subsection (3) of this
section if the insured institution or trust company does not hold any funds
on deposit for a public official that exceed the limits specified in ORS
295.025 for that type of depository. The provisions of ORS 295.015, 295.018,
295.035[, 295.045,] and
295.055[, 295.065, 295.105 and 295.185]
and sections 4 and 7 of this 2007 Act do not apply to an insured
institution or trust company that is a bank depository [bank] under this subsection.
[(4) An insured institution or trust company may not be a pool manager
with respect to securities that it deposits with its custodians as collateral
for the security of public fund deposits, and an insured institution or trust
company may not be a pool manager unless it certifies in writing to the State
Treasurer that it will furnish the reports required under ORS 714.075 to the
Director of the Department of Consumer and Business Services.]
SECTION 17. ORS 295.015 is amended to read:
295.015. Except as
provided in ORS 295.018:
(1)(a) Each bank
depository throughout the period of its possession of public fund deposits in
excess of the amounts insured or guaranteed as described in ORS 295.025 (1)(a) and (b) shall maintain on deposit with its [custodians] custodian, at its own
expense, securities having a value [not
less than 25 percent of the certificates of participation issued by its pool
manager.] at least equal to its maximum liability and as otherwise
prescribed in ORS 295.005 to 295.165. Such collateral shall be deposited with
the bank depository’s custodian and shall be clearly designated as security for
the benefit of depositors of public funds under ORS 295.005 to 295.165.
(b) For purposes of this
section, when pledged as collateral for public funds deposits, loans described
in ORS 295.005 (17)(f) shall be discounted to 75 percent of the unpaid
principal balance owing on the loan from time to time, or to a lower value
determined by the State Treasurer from time to time.
(c) When a bond
anticipation note is pledged as collateral for public funds deposits, if there
is no readily determinable market value for the note, it shall be discounted to
75 percent of the unpaid principal balance owing on the note from time to time,
or to a lower value determined by the State Treasurer from time to time.
(2) The bank
depository may deposit other eligible securities with its custodian and
withdraw from deposit securities theretofore pledged to secure deposits of
public funds, if the remaining securities have a value not less than [25 percent of outstanding certificates of
participation of the pool manager] its maximum liability. The [pool manager] State Treasurer
shall execute such releases and surrender such custodian’s receipts as are
appropriate to effect substitutions and withdrawals of matured and
excess pledged securities.
(3) If a bank
depository’s maximum liability increases because it ceases to be a well
capitalized bank depository or because it ceases to be an adequately
capitalized bank depository, within five business days after the date on which
the bank depository’s maximum liability increases, the bank depository shall:
(a) Notify its custodian
and the State Treasurer in writing that the bank depository’s maximum liability
has increased, setting forth the bank depository’s new maximum liability; and
(b) Tender to its
custodian additional securities having sufficient value to increase the total
value of its securities pledged as collateral for public funds deposits to the
new maximum liability of the bank depository.
(4) If a bank depository’s
maximum liability decreases because it moves from being an undercapitalized
bank depository to being a well capitalized bank depository or an adequately
capitalized bank depository, or because it moves from being an adequately
capitalized bank depository to a well capitalized bank depository, the bank
depository may:
(a) Notify its custodian
and the State Treasurer in writing that the bank depository’s maximum liability
has decreased, setting forth the bank depository’s new maximum liability; and
(b) With the written
approval of the State Treasurer, withdraw from its custodian any securities
that exceed the bank depository’s new maximum liability.
(5) The State Treasurer
shall act upon requests for releases and withdrawals of securities under subsections
(2) and (4)(b) of this section within three business
days after the receipt of each request.
SECTION 18. ORS 295.018 is amended to read:
295.018. (1) The State
Treasurer may require any bank depository [bank] during any period when it has in its possession public fund
deposits to maintain on deposit with its custodians securities having a value
not less than 110 percent of the greater of: [the certificates of participation issued by its pool manager.]
(a) All public funds
held by the bank depository; or
(b) The average of the
balances of public funds held by the bank depository, as shown on the last four
immediately preceding treasurer reports.
(2) [The]
An increase in collateral under subsection (1)
of this section shall be ordered upon the advice of the Director of the
Department of Consumer and Business Services. If the bank depository [bank] is a national bank or a
federally chartered savings bank or savings and loan association, in
giving [its] advice to the State
Treasurer the director may rely exclusively on information provided to the
director by federal regulatory agencies and by the association on forms
prescribed by the director[;].
As a condition of being analyzed and reviewed by the director, a federal
association shall agree and consent to provide the director with accurate,
pertinent and timely information.
[(2)] (3) Failure of the director to inform the State
Treasurer of the condition of any bank depository does not give any
public depositor any right or impose any liability on the director. The State
Treasurer shall not be liable to any public depositor or to any bank
depository [bank] for increasing or
not increasing the collateral requirement as authorized in subsection (1) of
this section.
[(3)] (4) Any bank depository [bank] notified by the State Treasurer of the increased collateral
requirement shall comply with the order within [10] five business days by increasing the collateral in the
same manner as required for the initial deposit of collateral in ORS 295.015[. The bank] and, within the same five
days, shall notify the State Treasurer [and
the pool manager] of its compliance by supplying copies of the custodian’s
receipts for, or statement of activity showing, the increased
collateral.
[(4)] (5)(a) If [any
depository bank notified by the State Treasurer of an increased collateral
requirement fails to notify the State Treasurer of compliance therewith within
10] the State Treasurer does not receive the notice required in
subsection (4) of this section within the required five business days, the
State Treasurer shall immediately notify the director of the failure and shall
send notice to [the pool manager and]
all public [depositors] officials
served by that bank depository [bank]
of its failure to comply.
(b) If, after giving
notice as required by paragraph (a) of this subsection, the State Treasurer
receives notice that the bank depository is in compliance with the increased
collateral requirements, the treasurer shall notify the public officials served
by the bank depository that the bank depository is once again in compliance.
[(5)] (6) A bank depository [bank described in] that does not comply with subsection (4)
of this section shall accept no further public funds deposits that
are not insured by the Federal Deposit Insurance Corporation.
[(6)] (7) The names of financial institutions [named] contained in records
received or compiled by the State Treasurer pursuant to the provisions of this
section shall be exempt from public disclosure unless the public interest requires
disclosure in the particular instance.
SECTION 19. ORS 295.025 is amended to read:
295.025. (1) Any public official may retain undeposited such reasonable
cash working fund as is fixed by the governing body of the political
subdivision or public corporation for which the public official acts. Except to
the extent of such cash working fund, each public official shall deposit public
funds in the custody or control of the public official in one or more
depositories currently qualified pursuant to ORS 295.005 to 295.165. The public
official may not have on deposit in any one credit union depository [bank that is a credit union or federal
credit union] an aggregate sum in excess of [$100,000] the deposit insurance limits established by the
National Credit Union Administration. With respect to [other depository banks] bank depositories, unless a bank
depository has entered into the agreement described in ORS 295.008 (2)(b) and has deposited securities pursuant to ORS 295.015
(1), the public official[, without
procuring certificates of participation issued by the pool manager of the
depository in an amount equal to the excess deposit,] shall not have on
deposit in any one bank depository [bank]
and its branches a sum in excess of:
(a) The amount insured
by the Federal Deposit Insurance Corporation; or
(b) For any amount over
the amount insured by the Federal Deposit Insurance Corporation, the amount
insured or guaranteed by private deposit insurance or a deposit guaranty bond
issued by an insurance company rated A- or better by a recognized insurance
rating service.
[(2) Whenever a public official holds a certificate of participation
issued by a pool manager in an amount exceeding the amount required by
subsection (1) of this section, upon the written request of the depository bank
the public official shall surrender it to the pool manager or direct the pool
manager in writing to cancel it in whole or in a designated part.]
[(3)] (2) Compliance with ORS 295.005 to 295.165 relieves the
public official of personal liability on account of the loss of the public
funds in the custody or control of the public official.
SECTION 20. ORS 295.027 is amended to read:
295.027. (1) A public
official may deposit public funds in a bank depository in an amount in
excess of the amount allowed in ORS 295.025 without [procuring a certificate of participation] requiring the bank
depository to show that it has entered into the agreement described in ORS
295.008 (2)(b) or deposited securities pursuant to ORS
295.015 (1) if the funds are initially deposited into a bank
depository in Oregon and the Oregon bank depository participates in a
program through which:
(a) The Oregon bank
depository arranges for deposit of the funds into one or more certificates of
deposit or time deposits issued by other financial institutions in the
(b) Each certificate of
deposit or time deposit is fully insured by the Federal Deposit Insurance
Corporation;
(c) The Oregon bank
depository administers the funds on behalf of the public official; and
(d) Other financial
institutions participating in the program place funds into the
(2) Until the Oregon
bank depository places public funds into one or more certificates of deposit or
time deposits as provided in subsection (1) of this section, any public funds
held by the Oregon bank depository pending such placement that are in excess of
the amounts allowed in ORS 295.025 must be collateralized as provided in ORS
295.005 to 295.165 for other public funds deposits.
[(2)] (3) The provisions of ORS 295.015, 295.018, 295.035 and
295.055 and section 4 of this 2007 Act do not apply to public funds deposits
deposited into a bank depository in Oregon that the bank depository arranges
for under the provisions of the program described in this section. The
provisions of ORS 294.035 and 295.005 requiring deposit of public funds into
depositories that have offices or branches in
[(3) As used in this section, “public funds” and “public official” have
the meanings given those terms in ORS 295.005.]
SECTION 21. ORS 295.035 is amended to read:
295.035. (1) Upon receipt of securities from the bank depository [bank], the custodian bank shall issue to
[the pool manager designated by the
depository] the State Treasurer, with a copy to the bank depository,
a custodian’s receipt describing the securities.
(2) Each custodian
shall:
(a) Maintain an accurate
inventory of the securities of each bank depository described in the custodian’s
receipts issued by the custodian to the State Treasurer, and adjust the
inventory to reflect withdrawals and substitutions of securities previously
inventoried.
(b) Appraise the value
of the securities added to and withdrawn from the inventory of the bank
depository, and appraise the value of the entire inventory of the bank
depository on the last day of each month and at such other times as the State
Treasurer directs.
(c) Provide a monthly
report to the State Treasurer listing the securities pledged by each bank depository
and setting forth the value of each security and of the entire inventory of
securities pledged by the bank depository.
(d) Notify a bank
depository in writing whenever the value of the securities held by the
custodian for the bank depository is less than:
(A) For a bank
depository that is subject to increased collateral requirements under ORS
295.018, 110 percent of the greater of:
(i) All public funds
held by the bank depository; or
(ii) The average of the
balances of public funds held by the bank depository, as shown on the last four
immediately preceding treasurer reports; or
(B) For a bank
depository that is not subject to increased collateral requirements under ORS
295.018, the maximum liability for the bank depository.
(e) Notify the State
Treasurer in writing if a bank depository fails to increase the value of its
securities within five business days after receipt of notice under paragraph
(d) of this subsection.
(f) Notify the State
Treasurer in writing if a bank depository increases the value of its securities
to an adequate amount after receipt of notice under paragraph (d) of this
subsection.
(g) Notify the State
Treasurer whenever a bond in the inventory of a bank depository no longer meets
the rating requirements described in ORS 295.005 (17)(c) or (d).
SECTION 22. ORS 295.055 is amended to read:
295.055. (1) Each bank depository [bank] shall keep on file with the State Treasurer the [names and addresses of each of its custodian
banks and pool managers] name and address of its custodian bank.
(2) Each public
official shall keep on file with the State Treasurer the names, addresses and
such other information as the State Treasurer shall prescribe by rule of each
depository in which the public official deposits public funds.
SECTION 23. ORS 295.115 is amended to read:
295.115. (1) Subject
to ORS 295.015, 295.018 and 295.025, any depository may offer in writing to
accept from the State Treasurer time deposits without limitation in amount or
in an aggregate amount therein stated and to pay interest on the time deposits
at rates specified in the offer. The offer shall be a continuing offer until it
is modified or withdrawn by notice in writing delivered or mailed by registered
or certified mail to the State Treasurer. While the offer continues in effect,
the depository is bound to accept upon the terms therein specified time
deposits tendered by the State Treasurer.
(2) Any funds deposited
by the State Treasurer on a time basis shall be deposited at the highest rate
of interest available for the amount and term of the deposit.
(3) The State Treasurer
shall establish time deposits so as to make the deposited moneys as productive
as possible, and shall exercise the judgment and care which persons of
prudence, discretion and intelligence exercise in the management of their own
affairs, considering the probable income and the probable safety of the moneys
deposited, including the distribution of the deposits among depositories so as
to minimize the possibility of loss of moneys.
SECTION 24. ORS 295.205 is amended to read:
295.205. (1) Notwithstanding any other law:
(a) The State Treasurer
may establish demand deposit accounts in financial institutions outside this
state for the purpose of accepting deposits of funds related to the state
investments in the geographical areas respectively serviced by the
institutions.
(b) Moneys paid to or
collected by a financial institution or other entity under an agreement to
provide loan servicing for a state agency, political subdivision or public
corporation may be deposited in accounts in financial institutions outside this
state for the purpose of:
(A) Accepting payments
of loan principal and interest;
(B) Accepting and
holding escrow funds;
(C) Accepting and
holding funds required to be held in reserve with or on behalf of the state
agency, political subdivision or public corporation; or
(D) Collecting and
holding any other moneys required by the agreement for loan servicing to be
collected or held by the financial institution or other entity prior to
remittance to the state agency, political subdivision or public corporation or
a third party.
(c) Moneys held by a
trustee or escrow agent pursuant to a bond indenture, certificate of
participation indenture or escrow agreement with a state agency, political
subdivision or public corporation in this state that are public funds, as
defined in ORS 295.005, may be deposited in accounts in financial institutions
outside this state.
(2) The State Treasurer
shall establish the demand deposit accounts described in subsection (1)(a) of
this section in accordance with rules adopted pursuant to ORS 183.310 to
183.410 that[, to the extent practicable,
provide that deposits of state investment funds are collateralized and managed
in the manner otherwise required for deposits of public funds in the state
under ORS 295.005 to 295.165.] ensure that reasonable and prudent
measures are taken to protect the state investment funds from loss.
(3) When accounts are
established for a state agency, political subdivision or public corporation
under subsection (1)(b) or (c) of this section, the
state agency, political subdivision or public corporation in the agreement to
provide loan servicing or the bond indenture, certificate of participation
indenture or escrow agreement shall [require
that:] ensure that reasonable and prudent measures are taken to protect
the moneys in the accounts from loss.
[(a) All moneys deposited in the accounts, to the extent practicable,
must be collateralized at the same level and managed in the same manner
otherwise required for deposits of public funds in this state under ORS 295.005
to 295.165;]
[(b) Compliance with the collateralization and management requirements
of this subsection be monitored and evidence of compliance that is satisfactory
to the state agency, political subdivision or public corporation be
periodically supplied to the state agency, political subdivision or public
corporation; and]
[(c) Failure by a financial institution or other entity to maintain
deposits collateralized and managed as required by this subsection shall
constitute a breach of the applicable loan servicing agreement, bond indenture,
certificate of participation indenture or escrow agreement.]
(4) A public official
may not have on deposit in any credit union that is a financial institution
outside this state an aggregate sum in excess of the deposit insurance limit
established by the National Credit Union Administration.
(5) As used in this
section, the terms “financial institution outside this state” and “public
official” have the meanings given those terms in ORS 295.005.
SECTION 25. ORS 182.470 is amended to read:
182.470. (1)
Notwithstanding ORS 670.335, except where otherwise specifically provided by
statute pursuant to ORS 182.462 (5), all moneys collected or received by a
board, placed to the credit of that board and remaining unexpended and
unobligated on the date that the board is established as a semi-independent
state agency, and all moneys collected or received by a board after the date that
the board is established as a semi-independent state agency, must be deposited
into an account established by that board in a depository [bank] insured by the Federal Deposit Insurance Corporation or the
National Credit Union Share Insurance Fund. In a manner consistent with the
requirements of [ORS chapter 295]
ORS 295.005 to 295.165, the chairperson, president or administrator of a
board shall ensure that sufficient collateral secures any amount of funds on
deposit that exceeds the limits of the coverage of the Federal Deposit
Insurance Corporation or the National Credit Union Share Insurance Fund. All
moneys in the account are continuously appropriated to the board making the
deposit for the purpose of carrying out the functions of the board.
(2) Subject to the
approval of the chairperson, president or administrator, a board may invest
moneys collected or received by the board. Investments made by a board are:
(a) Limited to
investments described in ORS 294.035;
(b) Subject to the
investment maturity date limitations described in ORS 294.135; and
(c)
Subject to the conduct prohibitions listed in ORS 294.145.
(3) Interest earned from
any accounts invested under subsection (2) of this section shall be made
available to a board in a manner consistent with the board’s annual budget.
(4) Subject to the
approval of the chairperson, president or administrator, all necessary board
expenses shall be paid from the moneys collected or earned by a board.
(5) As used in this
section, “depository [bank]” has the meaning
given that term in ORS 295.005.
SECTION 26. ORS 284.365 is amended to read:
284.365. (1) All moneys collected, received or appropriated to the Oregon
Film and Video Office shall be deposited in an account established in a
depository [bank] insured by the
Federal Deposit Insurance Corporation or the National Credit Union Share
Insurance Fund. In a manner consistent with the requirements of [ORS chapter 295] ORS 295.005 to
295.165, the chairperson of the Film and Video Board shall insure that
sufficient collateral secures any amount of funds on deposit that exceeds the
limits of the coverage of the Federal Deposit Insurance Corporation or the
National Credit Union Share Insurance Fund. Subject to approval by the
chairperson, the board may invest moneys collected or received by the office.
Investments made by the board are limited to the types of investments listed in
ORS 294.035 (3)(a) to (i). Interest earned from any
amounts invested must be made available to the office in a manner consistent
with the biennial budget approved by the board.
(2) Subject to the
approval of the director of the office, all necessary expenses of the office
and the board must be paid from the moneys collected, appropriated or earned by
the office.
(3) The office shall adopt
a budget on a biennial basis using the classifications of expenditures and
revenues required by ORS 291.206 (1). The budget is not subject to review and
approval by the Legislative Assembly or to modification by the Emergency Board
or the Legislative Assembly. However, the budget must be included in the
biennial report required by ORS 284.335 (5).
(4) The board shall
adopt a budget only after holding a public hearing on the proposed budget. At
least 15 days prior to any public hearing on the proposed budget, the board
shall give notice of the hearing to all persons known to be interested in the
proceedings of the board and to any person who requests notice.
(5) All expenditures
from the account established for the office under subsection (1) of this section
are exempt from any state expenditure limitation. The office shall follow
generally accepted accounting principles and keep such financial and
statistical information that is necessary to completely and accurately disclose
the financial condition and financial operations of the office as may be
required by the Secretary of State.
(6) As used in this
section, “depository [bank]” has the
meaning given that term in ORS 295.005.
SECTION 27. ORS 294.847 is amended to read:
294.847. In making
investments pursuant to ORS 294.805 to 294.895, the investment officer shall
not:
(1) Make a commitment to
invest funds or sell securities more than 14 business days prior to the
anticipated date of settlement of the purchase or sale transaction;
(2) Enter into any
agreement to invest funds or sell securities for future delivery for a fee
other than interest;
(3) Lend securities to
any person or institution, except on a fully collateralized basis;
(4) Pay for any
securities purchased by the investment officer until the investment officer has
received physical possession, or other sufficient evidence, as determined under
ORS 293.751 (1), of title thereof. However, the investment officer may instruct
any custodian bank, defined in ORS 295.005 [(2)],
to accept securities on the investment officer’s behalf against payment
therefor previously deposited with the institution by the investment officer;
or
(5) Deliver securities
to the purchaser thereof upon sale prior to receiving payment in full therefor.
However, the investment officer may deliver the securities to any custodian
bank, defined in ORS 295.005 [(2)],
upon instructions to hold the same pending receipt by the institution of full
payment therefor.
SECTION 28. ORS 377.840 is amended to read:
377.840. (1) All moneys collected or received by the Travel Information
Council shall be deposited into a Travel Information Council account
established in a depository [bank]
insured by the Federal Deposit Insurance Corporation or the National Credit
Union Share Insurance Fund. In a manner consistent with the requirements of [ORS chapter 295] ORS 295.005 to
295.165, the chairperson of the council shall insure that sufficient
collateral secures any amount of funds on deposit that exceeds the limits of
the coverage of the Federal Deposit Insurance Corporation or the National
Credit Union Share Insurance Fund. Subject to the chairperson’s approval, the
council may invest moneys collected or received by the council. Investments
made by the council are limited to the types of investments listed in ORS
294.035. Interest earned from any amounts invested shall be made available to
the council in a manner consistent with the council’s approved biennial budget.
(2) Subject to the
approval of the chairperson or director of the Travel Information Council, all
necessary council expenses shall be paid from the moneys collected or earned by
the council.
(3)(a) The Travel
Information Council shall adopt a budget on a biennial basis using the
classifications of expenditures and revenues required by ORS 291.206 (1).
However, the budget shall not be subject to review and approval by the
Legislative Assembly or to future modification by the Emergency Board or
Legislative Assembly.
(b) The council shall
adopt a budget only after a public hearing thereon. At least 15 days prior to
any public hearing on the budget, the council shall give notice of the hearing
to all persons known to be interested in the proceedings of the council and to
any person who requests notice.
(4) All expenditures
from the Travel Information Council account are exempt from any state
expenditure limitation. The Travel Information Council shall follow generally
accepted accounting principles and keep such other financial and statistical
information as may be necessary to completely and accurately disclose the
financial condition and financial operations of the council as may be required
by the Secretary of State.
(5) As used in this
section, “depository [bank]” has the
meaning given in ORS 295.005.
SECTION 29. ORS 576.375 is amended to read:
576.375. (1) All moneys
collected or received by any person from the assessment levied under the
authority of ORS 576.325 and all other moneys received by a commodity
commission must be paid to the authorized agent of the commission and promptly
deposited into an account established by the commission in a depository [bank], as defined in ORS 295.005, that
is insured by the Federal Deposit Insurance Corporation. In a manner consistent
with the requirements of [ORS chapter 295]
ORS 295.005 to 295.165, the chairperson and vice chairperson for a
commission shall ensure that sufficient collateral secures any amount of funds
on deposit that exceeds the limits of the Federal Deposit Insurance Corporation’s
coverage. All moneys in the account are continuously appropriated to the
commission making the deposit for the purpose of carrying out the duties,
functions and powers of the commission.
(2) Moneys may not be
withdrawn from or paid out of the account except upon order of the commission,
and upon checks or other orders upon such accounts signed by the
secretary-treasurer or such other member of the commission as the commission
designates and countersigned by such other member, officer or employee of the
commission as the commission designates. The commission shall keep a receipt,
voucher or other written record, showing clearly the nature and items covered
by each check or other order.
(3) Subject to approval
by the Director of Agriculture, a commission may invest moneys collected or
received by the commission. Investments made by a commission are:
(a) Limited to
investments described in ORS 294.035;
(b) Subject to the
investments maturity date limitations described in ORS 294.135; and
(c)
Subject to the conduct prohibitions listed in ORS 294.145.
(4) Interest earned from
any moneys invested by a commission under subsection (3) of this section is
available to the commission in a manner consistent with the commission’s annual
budget.
SECTION 30. ORS 706.720 is amended to read:
706.720. (1) The
Director of the Department of Consumer and Business Services shall receive and
file in the Department of Consumer and Business Services all reports required
by the Bank Act.
(2) Except as provided
in subsection (3) of this section and ORS 706.730, the records of the
Department of Consumer and Business Services pertaining to the administration
of the Bank Act are available for public inspection unless the director
determines in the particular instance that the public interest in disclosure of
the records is outweighed by the interests of an Oregon operating institution
or its directors, stockholders, officers, employees and customers in keeping
the records confidential, or that the records are exempt from disclosure under
ORS 192.501 to 192.505. A determination by the director under this subsection
is subject to review under ORS 192.410 to 192.505.
(3) Except as provided
in subsections (4) and (5) of this section, the following records of the
department are exempt from disclosure or production and shall be treated as
confidential as provided in ORS 705.137:
(a) Examination reports
and work papers, directives, orders and correspondence that relate to
examination reports.
(b) Investigatory
information concerning persons subject to investigation by the director under
ORS 707.070, 707.080, 707.110, 707.140, 707.145, 707.155 or 707.705 and
financial statements of such persons.
(c) Proprietary
information.
(d) Reviews of financial
statements submitted to the director.
(e) Reports filed under
ORS 706.655.
(f) Stockholder lists.
(4) Notwithstanding
subsection (3) of this section, the director may disclose any record of the
department specified in this subsection pertaining to an Oregon operating
institution that has been liquidated under ORS 711.400 to 711.615 if the
director determines in the particular instance that the public interest in
disclosure of the record outweighs the interests of the Oregon operating
institution or its directors, stockholders, officers, employees or customers in
keeping the record confidential. Under no circumstances, however, shall the
director disclose any such record or portion thereof that contains any
proprietary information or any information relating to the individual financial
activities or affairs of persons unless the director concludes that those
activities or affairs were a direct and substantial contributing factor in the
failure of the Oregon operating institution. This subsection applies to the
following records of the department:
(a) Examination reports
and work papers, directives, orders and correspondence relating to examination
reports;
(b) Investigatory
information concerning persons subject to investigation by the director under
ORS 707.070, 707.080, 707.110, 707.140, 707.145, 707.155 or 707.705;
(c) Reviews of financial
statements; and
(d) Reports filed under
ORS 706.655.
(5) Notwithstanding ORS
40.270, an officer of the department may be examined concerning records that
are exempt from disclosure under subsection (2) or (3) of this section and ORS
706.730 and the records are subject to production if the court before which a
civil or criminal action is pending finds that such examination and production
is essential for establishing a claim or defense. In making a finding under
this subsection, if the court views the records, the court shall do so in
camera.
(6) A civil penalty
imposed by the director under the Bank Act shall become subject to public
inspection after the 20th day after the director imposes the civil penalty.
(7) All records of the
department pertaining to the condition of
(a) The Federal Reserve
Bank and its examiners.
(b) The Comptroller of
the Currency of the
(c) The Federal Deposit
Insurance Corporation and its examiners.
(d) The Federal Home
Loan Bank of which the operating institution is a member or to which the
operating institution has applied for membership.
(e) The State Treasurer
if the
(f) Any supervisory
authority that regulates financial institutions, financial holding companies or
bank holding companies.
(g)
The respective
(8) The director shall
prescribe and furnish to interested persons the forms for all reports required
by the Bank Act.
(9) If the director is
requested to disclose any record subject to this section and the record
contains both material that is exempt from disclosure under this section or any
other provision of law and material that is not exempt from disclosure, the
director shall separate the exempt and nonexempt material and shall disclose
only the nonexempt material.
SECTION 31. ORS 708A.535 is amended to read:
708A.535. (1) An institution may only grant security interests in its
assets:
(a) To secure its
indebtedness to a Federal Reserve Bank or Federal Home Loan Bank.
(b) To secure its
borrowings from others with a maturity of 90 days or less,
provided the value of the assets pledged shall not be more than 50 percent
greater than the amount borrowed. If the value of the assets pledged is more
than 25 percent greater than the amount borrowed or if the amount borrowed is
greater than the stockholders’ equity of the bank, the transaction shall first
be approved in writing by the Director of the Department of Consumer and
Business Services.
(c) To secure its
deposits that are not insured by the Federal Deposit Insurance Corporation
provided:
(A) The value of
aggregate assets pledged does not exceed 20 percent of its stockholders’
equity; and
(B) The prior written
approval of the director is obtained.
(d) To secure public
funds pursuant to ORS 295.005 to 295.165, trust funds awaiting
investment or distribution, or trust funds deposited with it by an institution.
(2) Notwithstanding any
other provision of state law, when an institution grants a security interest in
assets to secure public funds, the depositor of the public funds and any bailee
of pledged securities or other assets shall be entitled to the status of a lien
creditor as defined in ORS 79.0102.
(3) An institution shall
grant a security interest in its assets only when authorized by a general or
specific prior resolution [or] of
its board of directors.
(4) As used in this
section, “public funds” means deposits belonging to:
(a) The State of
(b) Any county within
this state deposited to the official credit of the county treasurer, including
the funds of any irrigation or drainage district organized under the laws of
this state, or any school district within this state where funds of the school
district are deposited with the county treasurer, and funds that may be
deposited in an official capacity by any county officer.
(c) Any port, port
commission, dock or dock commission within this state that may be deposited to
the credit of the port, port commission, dock or dock commission, or the
treasurer thereof.
(d) Any city within this
state deposited to the official credit of the city treasurer, and funds that
may be deposited in an official capacity by any officer of any municipal
corporation.
(e) Any school district
within this state.
(f) Any district
organized under the laws of this state with the power to levy taxes.
(g) Any housing
authority organized and operating pursuant to ORS 456.055 to 456.235.
(h) The
SECTION 32. ORS 711.410 is amended to read:
711.410. Except for
transfers by a bank depository or the State Treasurer of public funds or
securities as required by ORS 295.005 to 295.165, all transfers of assets
made after the commission of an act of insolvency or in contemplation of
insolvency, to prevent the application of the assets in the manner prescribed
by the Bank Act or to the preference of one creditor to another are void.
SECTION 33. On or before July 1, 2008, each insured
institution and trust company that wishes to act as a bank depository under ORS
295.005 to 295.165 from and after July 1, 2008, shall file with the State
Treasurer an initial written report signed or authenticated by an officer of
the insured institution or trust company, together with an executed copy of its
pledge agreement. The report shall set forth:
(1) The estimated total
amount of public funds that will be on deposit with the insured institution or
trust company as of July 1, 2008;
(2) The estimated net
worth of the insured institution or trust company on July 1, 2008;
(3) The amount and
nature of the collateral that will be deposited with its custodian to
collateralize the public funds deposits; and
(4) The identity of its
custodian.
SECTION 34. Notwithstanding any other law limiting
expenditures of the State Treasurer for the payment of expenses from fees,
moneys or other revenues, including Miscellaneous Receipts, but excluding
lottery funds and federal funds, for the biennium beginning July 1, 2007, the
limitation on expenditures for the State Treasurer established by section 1
(1), chapter 109, Oregon Laws 2007 (Enrolled House Bill 5049), is increased by
$86,786 for the purpose of carrying out the provisions of sections 1 to 14 of
this 2007 Act and the amendments to ORS 182.470, 284.365, 294.847, 295.005,
295.008, 295.015, 295.018, 295.025, 295.027, 295.035, 295.055, 295.115,
295.205, 377.840, 576.375, 706.720, 708A.535 and 711.410 by sections 15 to 32
of this 2007 Act.
SECTION 35. ORS 295.045, 295.065, 295.085, 295.105,
295.125, 295.175 and 295.185 are repealed.
SECTION 36. Sections 1 to 14 of this 2007 Act, the
amendments to ORS 182.470, 284.365, 294.847, 295.005, 295.008, 295.015,
295.018, 295.025, 295.027, 295.035, 295.055, 295.115, 295.205, 377.840,
576.375, 706.720, 708A.535 and 711.410 by sections 15 to 32 of this 2007 Act
and the repeal of ORS 295.045, 295.065, 295.085, 295.105, 295.125, 295.175 and
295.185 by section 35 of this 2007 Act become operative July 1, 2008.
SECTION 37. The provisions of sections 1 to 14 of this
2007 Act and the amendments to ORS 182.470, 284.365, 294.847, 295.005, 295.008,
295.015, 295.018, 295.025, 295.027, 295.035, 295.055, 295.115, 295.205,
377.840, 576.375, 706.720, 708A.535 and 711.410 by sections 15 to 32 of this
2007 Act apply to all public funds on deposit on or after July 1, 2008.
SECTION 38. If House Bill 3265 becomes law, section 34 of
this 2007 Act is amended to read:
Sec.
34. Notwithstanding any other law limiting expenditures of the State
Treasurer for the payment of expenses from fees, moneys or other revenues,
including Miscellaneous Receipts, but excluding lottery funds and federal
funds, for the biennium beginning July 1, 2007, the limitation on expenditures
for the State Treasurer established by section 1 (1), chapter 109, Oregon Laws
2007 (Enrolled House Bill 5049), is increased by $86,786 for the purpose of
carrying out the provisions of sections 1 to 14 of this 2007 Act and the
amendments to ORS 182.470, 284.365, 294.847, 295.005, 295.008, 295.015,
295.018, 295.025, 295.027, 295.035, 295.055, 295.115, 295.205, 377.840,
576.375, 706.720, 708A.535 and 711.410 by sections [15] 15a to 32 of this 2007 Act.
SECTION 39. If House Bill 3265 becomes law, section 36 of
this 2007 Act is amended to read:
Sec.
36. Sections 1 to 14 of this 2007 Act, the amendments to ORS
182.470, 284.365, 294.847, 295.005, 295.008, 295.015, 295.018, 295.025,
295.027, 295.035, 295.055, 295.115, 295.205, 377.840, 576.375, 706.720,
708A.535 and 711.410 by sections [15]
15a to 32 of this 2007 Act and the repeal of ORS 295.045, 295.065,
295.085, 295.105, 295.125, 295.175 and 295.185 by section 35 of this 2007 Act
become operative July 1, 2008.
SECTION 40. If House Bill 3265 becomes law, section 37 of
this 2007 Act is amended to read:
Sec.
37. The provisions of sections 1 to 14 of this 2007 Act and the
amendments to ORS 182.470, 284.365, 294.847, 295.005, 295.008, 295.015,
295.018, 295.025, 295.027, 295.035, 295.055, 295.115, 295.205, 377.840,
576.375, 706.720, 708A.535 and 711.410 by sections [15] 15a to 32 of this 2007 Act apply to all public funds on
deposit on or after July 1, 2008.
Approved by the Governor July 31, 2007
Filed in the office of Secretary of State July 31, 2007
Effective date January 1, 2008
__________