HomeMy WebLinkAboutAB 2011 - Vargas\I L M
CITY OF PALM DESERT
Community Services Division
Staff Report
REQUEST: CONSIDERATION OF LEGISLATIVE REVIEW COMMITTEE ACTION
ON AB 2011 (VARGAS) AT ITS MEETING OF FEBRUARY 28, 2006
SUBMITTED BY: Patricia Scully, CFEE, Senior Management Analyst
DATE: March 23, 2006
CONTENTS: AB 2011 Language
RECOMMENDATION:
By Minute Motion, concur with the action taken by the Legislative Review Committee at its
Meeting of February 28, 2006, and direct staff to prepare a letter of opposition for the Mayor's
signature with regard to AB 2011 (Vargas) relative to local agency investments.
EXECUTIVE SUMMARY:
Passage of AB 2011 would authorize the investment of local funds in certificates of deposits
under specified conditions.
BACKGROUND:
Current law prescribes the instruments in, and criteria by, which local agencies may invest
surplus funds. AB 2011 would authorize the investments of funds and certificates of deposits
under specified conditions.
Passage of AB 2011 would defeat the provisions of a bill previously sponsored by Senator Jim
Battin at the request of the City of Palm Desert with regard to investment of surplus funds.
Unless the author of this bill is willing to exempt small cities from its language, the City of Palm
Desert would oppose this legislation, as it would eliminate the previously enacted provisions
for investment of these types of funds.
CITY COUNCIL STAFF REPORT
RE: AB 2011 (VARGAS) MARCH 23, 2006
Therefore, the Legislative Review Committee recommends that the City Council oppose AB
2011 and direct staff to prepare a letter stating that position to appropriate legislators for the
Mayor's signature.
aX.
PATRICIA SCULLY; CF
SENIOR AGEMENT ANALYST
SHEILA ' . ILLIGAN CARLOS L. ORTEGA
ACM/COMMUNITY ' ER ICES CITY MANAGER
PS:mpg
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AB 2011 Assembly Bill - INTRODUCED Page 1 of 1
BILL NUMBER: AB 2011 INTRODUCED
BILL TEXT
INTRODUCED BY Assembly Member Vargas
FEBRUARY 9, 2006
An act to add Section 53601.8 tc the Government Code, relating to
local_ agency investments.
LEGISLATIVE COUNSEL'S DIGEST
AB 2011, as introduced, Vargas Local agency investments.
Existing law prescribes the instruments in, and criteria by, which
local agencies, as defined, may invest surplus funds.
This bill would authorize the investment of those funds in
certificates of deposit under specified conditions.
Vote: majority. Appropriation: no. Fiscal committee: no.
State -mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 53601.8 is added to the Government Code, to
read:
53601.8. Notwithstanding Sections 53601 and 53635, or any other
provision of state or local law, a local agency may invest any
portion of the funds that it deems wise or expedient in accordance
with all of the following conditions.
(a) The money is invested through a federally or state -chartered
bank or savings and loan association in this state selected by the
local agency.
(b) The selected bank or savings and loan association arranges for
the deposit of the funds in certificates of deposit in one or more
banks or savings and loan associations wherever located in the United
States, for the account of the local agency.
(c) The full amount of principal and accrued interest of each such
certificate of deposit is insured by the Federal Deposit Insurance
Corporation.
(d) The selected bank or savings and loan association acts as
custodian for the local agency with respect to such certificates of
deposit issued for the local agency's account.
(e) At the same time the local agency's funds are deposited and
the certificates of deposit are issued, the selected bank or savings
and loan association receives an amount of deposits from customers of
other financial institutions wherever located in the United States
equal to or greater than the amount of the funds invested by the
local agency through the selected bank or savings and loan
association.
http://info.sen.ca.gov/pub/bill/asm/ab_2001-2050/ab_201 l _bill_20060209_introduced.html 3/2/2006