LB483 LB483
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LEGISLATURE OF NEBRASKA
ONE HUNDRED EIGHTH LEGISLATURE
FIRST SESSION
LEGISLATIVE BILL 483
Introduced by Raybould, 28.
Read first time January 17, 2023
Committee: Banking, Commerce and Insurance
1 A BILL FOR AN ACT relating to investment of public funds; to amend
2 sections 14-556, 15-847, 15-849, 16-691.01, 16-713, 16-715, 16-716,
3 17-607, 17-720, 30-3209, 72-1268.03, 77-2302, 77-2318, 77-2326.04,
4 77-2340, 77-2344, 77-2345, 77-2352, 77-2355, 77-2362, 77-2365.01,
5 77-2365.02, 77-2375, 77-2385, and 77-2389, Reissue Revised Statutes
6 of Nebraska, and sections 77-2387, 77-2388, 77-2392, 77-2395,
7 77-2398, 77-23,100, 77-23,101, 77-23,102, and 77-23,105, Revised
8 Statutes Cumulative Supplement, 2022; to add credit unions to the
9 definition of a qualifying mutual financial institution; to redefine
10 terms; to harmonize provisions; and to repeal the original sections.
11 Be it enacted by the people of the State of Nebraska,
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1 Section 1. Section 14-556, Reissue Revised Statutes of Nebraska, is
2 amended to read:
3 14-556 (1) The city treasurer of a city of the metropolitan class
4 shall place all funds of the city on deposit in such banks, capital stock
5 financial institutions, or qualifying mutual financial institutions
6 within the city as shall agree to pay the highest rate of interest for
7 the use of such funds so deposited. The city council is hereby directed
8 to advertise for bids for rates for the deposit of such funds as provided
9 in this section.
10 (2) The banks, capital stock financial institutions, or qualifying
11 mutual financial institutions referred to in subsection (1) of this
12 section, so selected, shall:
13 (a) Give bond to the city for the safekeeping of such funds, and
14 such city shall not have on deposit in any bank, capital stock financial
15 institution, or qualifying mutual financial institution giving a guaranty
16 bond more than the amount insured or guaranteed by the Federal Deposit
17 Insurance Corporation or the National Credit Union Administration plus
18 the maximum amount of the bond given by the bank, capital stock financial
19 institution, or qualifying mutual financial institution or in any bank,
20 capital stock financial institution, or qualifying mutual financial
21 institution giving a personal bond more than the amount insured or
22 guaranteed by the Federal Deposit Insurance Corporation or the National
23 Credit Union Administration plus one-half of the amount of the bond of
24 the bank, capital stock financial institution, or qualifying mutual
25 financial institution. All bonds of such banks, capital stock financial
26 institutions, or qualifying mutual financial institutions shall be
27 deposited with and held by the city treasurer; or
28 (b) Give security as provided in the Public Funds Deposit Security
29 Act.
30 (3) The fact that a stockholder, director, or other officer of such
31 bank, capital stock financial institution, or qualifying mutual financial
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1 institution is also serving as mayor, as a member of the city council, as
2 a member of a board of public works, or as any other officer of the city
3 shall not disqualify such bank, capital stock financial institution, or
4 qualifying mutual financial institution from acting as a depository for
5 such city funds.
6 (4) Section 77-2366 shall apply to deposits in capital stock
7 financial institutions.
8 (5) Section 77-2365.01 shall apply to deposits in qualifying mutual
9 financial institutions.
10 Sec. 2. Section 15-847, Reissue Revised Statutes of Nebraska, is
11 amended to read:
12 15-847 In lieu of the bond required by section 15-846, any bank,
13 capital stock financial institution, or qualifying mutual financial
14 institution making application to become a depository may give security
15 as provided in the Public Funds Deposit Security Act to the city
16 treasurer. The penal sum of such bond or the sum of such security may be
17 reduced in the amount of such deposit insured or guaranteed by the
18 Federal Deposit Insurance Corporation or the National Credit Union
19 Administration. Section 77-2366 shall apply to deposits in capital stock
20 financial institutions. Section 77-2365.01 shall apply to deposits in
21 qualifying mutual financial institutions.
22 Sec. 3. Section 15-849, Reissue Revised Statutes of Nebraska, is
23 amended to read:
24 15-849 The city treasurer may purchase certificates of deposit from
25 and make time deposits in banks, capital stock financial institutions, or
26 qualifying mutual financial institutions selected as depositories of city
27 funds pursuant to sections 15-846 to 15-848. The certificates of deposit
28 purchased and time deposits made shall bear interest and shall be secured
29 as prescribed in such sections. The penal sum of such bond or the sum of
30 such security shall be reduced in the amount of the time deposit or
31 certificate of deposit insured or guaranteed by the Federal Deposit
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1 Insurance Corporation or the National Credit Union Administration.
2 Section 77-2366 shall apply to deposits in capital stock financial
3 institutions. Section 77-2365.01 shall apply to deposits in qualifying
4 mutual financial institutions.
5 Sec. 4. Section 16-691.01, Reissue Revised Statutes of Nebraska, is
6 amended to read:
7 16-691.01 Any surplus funds remaining in the hands of the city
8 treasurer of a city of the first class, to the credit of such various
9 funds, may be invested by the board of public works, with the approval of
10 the mayor and city council, in accordance with the provisions of sections
11 16-712, 16-713, and 16-715, in interest-bearing securities of the State
12 of Nebraska or any political subdivision thereof, in certificates of
13 deposit of banks, capital stock financial institutions, or qualifying
14 mutual financial institutions which are members of the Federal Deposit
15 Insurance Corporation or the National Credit Union Administration, or in
16 interest-bearing securities of the United States upon an order for that
17 purpose drawn by the board of public works upon the city treasurer. Such
18 securities may be purchased, sold, or hypothecated by the board of public
19 works with the approval of the mayor and city council, at their fair
20 market value, and the interest earned by such securities shall be
21 credited to the account of the utility from which the funds paid for the
22 securities were originally drawn. In cities which have not conferred upon
23 any board of public works the active direction and supervision of the
24 city's system of waterworks, power plant, sewerage, and heating or
25 lighting plant, the powers and duties conferred upon the board of public
26 works as to the purchase, sale, and hypothecation of such securities
27 shall be exercised by the city treasurer. Securities so purchased shall
28 be held by the city treasurer who shall provide adequate bond for their
29 safekeeping. When sold, the treasurer shall deliver such securities to
30 the purchaser and collect the sale price.
31 Sec. 5. Section 16-713, Reissue Revised Statutes of Nebraska, is
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1 amended to read:
2 16-713 The city treasurer of a city of the first class may, upon
3 resolution of the mayor and city council authorizing the action, purchase
4 certificates of deposit from and make time deposits in banks, capital
5 stock financial institutions, or qualifying mutual financial institutions
6 selected as depositories of city funds under the provisions of sections
7 16-712, 16-714, and 16-715. The certificates of deposit purchased and
8 time deposits made shall bear interest and shall be secured as set forth
9 in sections 16-714 and 16-715, except that the penal sum of such bond or
10 the sum of such security shall be reduced in the amount of the time
11 deposit or certificate of deposit insured or guaranteed by the Federal
12 Deposit Insurance Corporation or the National Credit Union
13 Administration. Section 77-2366 shall apply to deposits in capital stock
14 financial institutions. Section 77-2365.01 shall apply to deposits in
15 qualifying mutual financial institutions.
16 Sec. 6. Section 16-715, Reissue Revised Statutes of Nebraska, is
17 amended to read:
18 16-715 In lieu of the bond required by section 16-714, any bank,
19 capital stock financial institution, or qualifying mutual financial
20 institution making application to become a depository may give security
21 as provided in the Public Funds Deposit Security Act to the city clerk.
22 The penal sum of such bond shall be equal to or greater than the amount
23 of the deposit in excess of that portion of such deposit insured or
24 guaranteed by the Federal Deposit Insurance Corporation or the National
25 Credit Union Administration. Section 77-2366 shall apply to deposits in
26 capital stock financial institutions. Section 77-2365.01 shall apply to
27 deposits in qualifying mutual financial institutions.
28 Sec. 7. Section 16-716, Reissue Revised Statutes of Nebraska, is
29 amended to read:
30 16-716 The city treasurer of a city of the first class shall not
31 have on deposit in any bank, capital stock financial institution, or
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1 qualifying mutual financial institution at any time more than the amount
2 insured or guaranteed by the Federal Deposit Insurance Corporation or the
3 National Credit Union Administration plus the maximum amount of the bond
4 given by the bank, capital stock financial institution, or qualifying
5 mutual financial institution if the bank, capital stock financial
6 institution, or qualifying mutual financial institution gives a surety
7 bond, nor in any bank, capital stock financial institution, or qualifying
8 mutual financial institution giving a personal bond, more than the amount
9 insured or guaranteed by the Federal Deposit Insurance Corporation or the
10 National Credit Union Administration plus one-half of the amount of the
11 bond of such bank, capital stock financial institution, or qualifying
12 mutual financial institution, and the amount so on deposit any time with
13 any such bank, capital stock financial institution, or qualifying mutual
14 financial institution shall not in either case exceed the amount insured
15 or guaranteed by the Federal Deposit Insurance Corporation or the
16 National Credit Union Administration plus the paid-up capital stock and
17 surplus of such bank, capital stock financial institution, or qualifying
18 mutual financial institution.
19 The city treasurer shall not be liable for any loss sustained by
20 reason of the failure of any such bonded depository whose bond has been
21 duly approved by the mayor as provided in section 16-714 or which has, in
22 lieu of a surety bond, given security as provided in section 16-715.
23 Sec. 8. Section 17-607, Reissue Revised Statutes of Nebraska, is
24 amended to read:
25 17-607 (1) The treasurer of a city of the second class or village
26 shall deposit, and at all times keep on deposit, for safekeeping, in
27 banks, capital stock financial institutions, or qualifying mutual
28 financial institutions of approved and responsible standing, all money
29 collected, received, or held by him or her as city treasurer or village
30 treasurer. Such deposits shall be subject to all regulations imposed by
31 law or adopted by the city council or village board of trustees for the
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1 receiving and holding thereof. The fact that a stockholder, director, or
2 other officer of such bank, capital stock financial institution, or
3 qualifying mutual financial institution is also serving as mayor, as a
4 member of the city council, as a member of the village board of trustees,
5 as a member of a board of public works, or as any other officer of such
6 municipality shall not disqualify such bank, capital stock financial
7 institution, or qualifying mutual financial institution from acting as a
8 depository for such municipal funds. Section 77-2366 shall apply to
9 deposits in capital stock financial institutions. Section 77-2365.01
10 shall apply to deposits in qualifying mutual financial institutions.
11 (2) The city council or village board of trustees shall require from
12 all banks, capital stock financial institutions, or qualifying mutual
13 financial institutions (a) a bond in such penal sum as may be the maximum
14 amount on deposit at any time less the amount insured or guaranteed by
15 the Federal Deposit Insurance Corporation or the National Credit Union
16 Administration or, in lieu thereof, (b) security given as provided in the
17 Public Funds Deposit Security Act, to secure the payment of all such
18 deposits and accretions. The city council or village board of trustees
19 shall approve such bond or giving of security. The city treasurer or
20 village treasurer shall not be liable for any loss of any money sustained
21 by reason of the failure of any such depository so designated and
22 approved.
23 Sec. 9. Section 17-720, Reissue Revised Statutes of Nebraska, is
24 amended to read:
25 17-720 The city treasurer or village treasurer of cities of the
26 second class and villages may, upon resolution of the mayor and city
27 council or village board of trustees authorizing the same, purchase
28 certificates of deposit from and make time deposits in any bank, capital
29 stock financial institution, or qualifying mutual financial institution
30 in the State of Nebraska to the extent that such certificates of deposit
31 or time deposits are insured or guaranteed by the Federal Deposit
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1 Insurance Corporation or the National Credit Union Administration.
2 Deposits may be made in excess of the amounts so secured by the
3 municipality, and the amount of the excess deposit shall be secured by a
4 bond or by security given in the same manner as is provided for cities of
5 the first class in sections 16-714 to 16-716 as of the time the deposit
6 is made. Section 77-2366 shall apply to deposits in capital stock
7 financial institutions. Section 77-2365.01 shall apply to deposits in
8 qualifying mutual financial institutions.
9 Sec. 10. Section 30-3209, Reissue Revised Statutes of Nebraska, is
10 amended to read:
11 30-3209 (1) Corporate trustees authorized by Nebraska law to
12 exercise fiduciary powers and holding retirement or pension funds for the
13 benefit of employees or former employees of cities, villages, school
14 districts, or other governmental or political subdivisions may invest and
15 reinvest such funds in such securities and investments as are authorized
16 for trustees, guardians, conservators, personal representatives, or
17 administrators under the laws of Nebraska. Retirement or pension funds of
18 such cities, villages, districts, or subdivisions may be invested in
19 annuities issued by life insurance companies authorized to do business in
20