2006 New York Code - Temporary Investments.

 
    §  11.  Temporary  investments.  1.  For purposes of this section, the
  terms "local government", "bank" and "trust company" shall have the same
  meanings as in section ten of this article.
    2. The governing board of any local government or,  if  the  governing
  board  so  delegates,  the  chief fiscal officer or other officer having
  custody of the moneys may temporarily invest  moneys  not  required  for
  immediate   expenditure,  except  moneys  the  investment  of  which  is
  otherwise provided for by law, in special time deposit accounts  in,  or
  certificates  of  deposit issued by, a bank or trust company located and
  authorized to do business in this state,  provided  however,  that  such
  time  deposit  account or certificate of deposit shall be payable within
  such time as the proceeds shall be needed to meet expenditures for which
  such moneys were obtained and provided further that  such  time  deposit
  account  or  certificate  of deposit be secured in the same manner as is
  provided for securing deposits of public funds by subdivision  three  of
  section ten of this article.
    * 3.  a.  Investments pursuant to this section may also be made in the
  following:
    (1) obligations of the United States  of  America  or  in  obligations
  guaranteed by agencies of the United States of America where the payment
  of principal and interest are guaranteed by the United States of America
  or  in obligations of the state of New York, or with the approval of the
  state comptroller in obligations issued pursuant  to  section  24.00  or
  25.00  of  the local finance law by any municipality, school district or
  district corporation other than the  municipality,  school  district  or
  district  corporation  investing such moneys pursuant to this paragraph.
  In addition, moneys in any reserve fund established pursuant to  section
  six-c,  six-d, six-e, six-f, six-g, six-h, six-j, six-k, six-l, six-m or
  six-n  of  this  article  may  be  invested  in   obligations   of   the
  municipality,  school  district,  fire  district or district corporation
  which has established the reserve fund, or in  the  case  of  a  capital
  reserve  fund  established  for  a  town or county improvement district,
  obligations of the town or  county  issued  for  the  purposes  of  such
  district.
    (2)  notwithstanding  any other provision of general, special or local
  law, any city having a population of one million or more may  also  make
  investments in the following:
    (i)  general  obligation  bonds and notes of any state other than this
  state, provided that such bonds and notes receive the highest rating  of
  at   least  one  independent  rating  agency  designated  by  the  state
  comptroller;
    (ii) obligations of any corporation organized under the  laws  of  any
  state  in  the  United  States maturing within two hundred seventy days,
  provided that  such  obligations  receive  the  highest  rating  of  two
  independent rating services designated by the state comptroller and that
  the  issuer  of  such obligations has maintained such ratings on similar
  obligations during the preceding six months, provided, however, that the
  issuer of such obligations need not have received such rating during the
  prior six month period if such issuer has received the highest rating of
  two independent rating services designated by the state comptroller  and
  is  the  successor  or  wholly  owned  subsidiary  of an issuer that has
  maintained such ratings on similar obligations during the preceding  six
  month  period or if the issuer is the product of a merger of two or more
  issuers, one of which has maintained such ratings on similar obligations
  during the preceding six month period, provided, however, that  no  more
  than  two  hundred  fifty  million  dollars  may  be  invested  in  such
  obligations of any one corporation; or
    (iii) bankers' acceptances maturing within two  hundred  seventy  days
  which  are  eligible  for purchase in the open market by federal reserve
  banks and which have been accepted by a bank or trust company  which  is
  organized  under  the  laws of the United States or of any state thereof
  and which is a member of the federal reserve system and whose short-term
  obligations   meet   the  criteria  outlined  in  clause  (ii)  of  this
  subparagraph. Provided, however, that no more  than  two  hundred  fifty
  million  dollars may be invested in such bankers' acceptances of any one
  bank or trust company; or
    (iv) obligations of, or instruments issued by or fully  guaranteed  as
  to  principal  and  interest  by,  any  agency or instrumentality of the
  United States acting pursuant to a grant of authority from the  congress
  of  the  United  States,  including but not limited to, any federal home
  loan bank or banks, the Tennessee valley authority, the federal national
  mortgage association, the federal home loan mortgage corporation and the
  United States postal service, provided, however, that no more  than  two
  hundred fifty million dollars may be invested in such obligations of any
  one agency.
    (v)  no-load money market mutual funds registered under the Securities
  Act of 1933, as amended, and operated in accordance with  Rule  2a-7  of
  the Investment Company Act of 1940, as amended, provided that such funds
  are  limited  to  investments in obligations issued or guaranteed by the
  United  States  of  America   or   in   obligations   of   agencies   or
  instrumentalities  of  the United States of America where the payment of
  principal and interest are guaranteed by the United  States  of  America
  (including   contracts   for   the  sale  and  repurchase  of  any  such
  obligations), and are rated in the highest rating category by  at  least
  one  nationally  recognized  statistical  rating organization, provided,
  however, that no more than two hundred  fifty  million  dollars  may  be
  invested in such funds.
    b.  All investments made pursuant to this subdivision shall be subject
  to the following conditions:
    (1) Such obligations shall be payable or redeemable at the  option  of
  the  owner  within  such  times  as  the proceeds will be needed to meet
  expenditures for purposes for which the moneys were provided and, in the
  case of obligations purchased with the proceeds of bonds or notes, shall
  be payable or redeemable in any event,  at  the  option  of  the  owner,
  within two years of the date of purchase. Obligations that are purchased
  pursuant  to  a  repurchase  agreement  shall be deemed to be payable or
  redeemable for purposes of this paragraph  on  the  date  on  which  the
  purchased  obligations  are  scheduled  to  be repurchased by the seller
  thereof. Any obligation that provides for the adjustment of its interest
  rate on set dates shall be  deemed  to  be  payable  or  redeemable  for
  purposes of this paragraph on the date on which the principal amount can
  be recovered through demand by the holder thereof.
    (2)  Such  obligations,  unless registered or inscribed in the name of
  the local government, shall be purchased through, delivered to and  held
  in  the  custody of a bank or trust company or, with respect to the city
  of New York,  a  reputable  dealer  in  such  obligations  as  shall  be
  designated  by  the  state  comptroller, in this state. Such obligations
  shall be purchased, sold or presented for redemption or payment by  such
  bank  or  trust company or dealer in obligations only in accordance with
  prior written authorization from the  officer  authorized  to  make  the
  investment.  All  such transactions shall be confirmed in writing to the
  local government by the bank or trust company. All obligations  held  in
  the  custody of a bank or trust company pursuant to this paragraph shall
  be held by such bank or trust company pursuant to  a  written  custodial
  agreement  as  set  forth in paragraph a of subdivision three of section
  ten of this article.
    * NB Effective until July 1, 2008
    * 3.  Investments  pursuant  to  this  section  may  also  be  made in
  obligations of the United States of America or in obligations guaranteed
  by agencies of the  United  States  of  America  where  the  payment  of
  principal and interest are guaranteed by the United States of America or
  in  obligations  of  the  state of New York,. In addition, moneys in any
  reserve fund established pursuant to section six-c, six-d, six-e, six-f,
  six-g, six-h, six-j, six-k, six-l, six-m or six-n of this article may be
  invested in obligations  of  the  municipality,  school  district,  fire
  district or district corporation which has established the reserve fund,
  or  in  the  case  of  a  capital reserve fund established for a town or
  county improvement district, obligations of the town  or  county  issued
  for the purposes of such district.
    All  investments made pursuant to this subdivision shall be subject to
  the following conditions:
    a. Such obligations shall be payable or redeemable at  the  option  of
  the  owner  within  such  times  as  the proceeds will be needed to meet
  expenditures for purposes for which the moneys were provided and, in the
  case of obligations purchased with the proceeds of bonds or notes, shall
  be payable or redeemable in any event,  at  the  option  of  the  owner,
  within two years of the date of purchase. Obligations that are purchased
  pursuant  to  a  repurchase  agreement  shall be deemed to be payable or
  redeemable for purposes of this paragraph  on  the  date  on  which  the
  purchased  obligations  are  scheduled  to  be repurchased by the seller
  thereof. Any obligation that provides for the adjustment of its interest
  rate on set dates shall be  deemed  to  be  payable  or  redeemable  for
  purposes of this paragraph on the date on which the principal amount can
  be recovered through demand by the holder thereof.
    b. Such obligations, unless registered or inscribed in the name of the
  local  government,  shall be purchased through, delivered to and held in
  the custody of a bank or trust company or, with respect to the  city  of
  New  York, a reputable dealer in such obligations as shall be designated
  by the state comptroller, in  this  state.  Such  obligations  shall  be
  purchased,  sold  or presented for redemption or payment by such bank or
  trust company or dealer in obligations only  in  accordance  with  prior
  written   authorization   from   the  officer  authorized  to  make  the
  investment. All such transactions shall be confirmed in writing  to  the
  local  government  by the bank or trust company. All obligations held in
  the custody of a bank or trust company pursuant to this paragraph  shall
  be  held  by  such bank or trust company pursuant to a written custodial
  agreement as set forth in paragraph a of subdivision  three  of  section
  ten of this article.
    * NB Effective July 1, 2008
    4.  Notwithstanding any other provision of law, the governing board of
  a local government may authorize the  aforementioned  officers  to  turn
  over  the  physical  custody  and  safekeeping  of  the evidences of the
  investments made pursuant to this section  to  (a)  any  bank  or  trust
  company  incorporated in this state, or (b) any national bank located in
  this  state,  or  (c)  any  private  banker  duly  authorized   by   the
  superintendent  of  banks  of this state to engage in business here. All
  such private bankers shall, as private  bankers,  maintain  a  permanent
  capital  of  not  less  than one million dollars in this state. The said
  officers may direct such  bank,  trust  company  or  private  banker  to
  register  and  hold any such evidences of investments in its custody, in
  the name of its nominee. Such officers may  deposit  or  authorize  such
  bank,  trust  company  or private banker, to deposit, or arrange for the
  deposit of any such evidences of investments with a federal reserve bank
  or other book-entry transfer system operated by  a  federally  regulated
  entity  to  be  credited to an account as to which the ownership of, and
  other  interests in, such evidences of investments may be transferred by
  entries on the books of such federal reserve bank  or  other  book-entry
  transfer  system  operated  by  a  federally  regulated  entity  without
  physical delivery of any such evidences of investments. The  records  of
  any such bank, trust company or private banker shall show, at all times,
  the  ownership  of  such  evidences of investments, and they shall, when
  held in the possession of such bank, trust company or private banker be,
  at all times, kept separate from the assets of such bank, trust  company
  or  private  banker.  All  evidences of investments delivered to a bank,
  trust company, or private banker pursuant to this subdivision  shall  be
  held by such bank, trust company or private banker pursuant to a written
  custodial  agreement as set forth in paragraph a of subdivision three of
  section ten of this article. When any such evidences of investments  are
  so  registered  in  the  name  of a nominee, such bank, trust company or
  private banker shall be absolutely liable for any loss occasioned by the
  acts of such nominee with respect to such evidences of investments.
    5. A county clerk may invest any money  collected  on  behalf  of  the
  state  until  such  time  as the money is required to be remitted to the
  state.  The county clerk shall invest the  state  money  only  in  those
  investments  authorized  by this section and payable within such time as
  the proceeds shall be required to be remitted to the state. Any interest
  that accrues on moneys invested pursuant to this  subdivision  shall  be
  payable  in  equal  shares  to  the  state  and  to the county provided,
  however, that any fees or service charges associated with the investment
  shall be paid from such interest.
    6. Except as may otherwise be provided in a contract with bond or note
  holders, any moneys of a political subdivision authorized to be invested
  pursuant to this section may  be  commingled  for  investment  purposes;
  provided,  however,  that  any  investment of commingled moneys shall be
  payable or redeemable at the option of the owner within such time as the
  proceeds shall be needed to meet expenditures for which such moneys were
  obtained or as otherwise specifically  provided  in  this  section.  The
  separate  identity  of  the  sources of such funds shall at all times be
  maintained and income received on moneys commingled for the  purpose  of
  investment  shall be credited on a pro rata basis to the fund or account
  from which the moneys were invested.
    7. The chief fiscal officer of each local government shall maintain or
  cause to be maintained a proper record of all books,  notes,  securities
  or  other  evidences of indebtedness held by or for such subdivision for
  the purpose of investment. Such  record  shall  at  least  identify  the
  security,  the  fund  for  which  held, the place where kept and entries
  shall be made therein showing date of sale or other disposition and  the
  amount realized therefrom.