2007 California Government Code Article 11. Local Agency Investment Fund

CA Codes (gov:16429.1-16429.4)

16429.1.  (a) There is in trust in the custody of the Treasurer the
Local Agency Investment Fund, which fund is hereby created.  The
Controller shall maintain a separate account for each governmental
unit having deposits in this fund.
   (b) Notwithstanding any other provisions of law, a local
governmental official, with the consent of the governing body of that
agency, having money in its treasury not required for immediate
needs, may remit the money to the Treasurer for deposit in the Local
Agency Investment Fund for the purpose of investment.
   (c) Notwithstanding any other provisions of law, an officer of any
nonprofit corporation whose membership is confined to public
agencies or public officials, or an officer of a qualified
quasi-governmental agency, with the consent of the governing body of
that agency, having money in its treasury not required for immediate
needs, may remit the money to the Treasurer for deposit in the Local
Agency Investment Fund for the purpose of investment.
   (d) Notwithstanding any other provision of law or of this section,
a local agency, with the approval of its governing body, may deposit
in the Local Agency Investment Fund proceeds of the issuance of
bonds, notes, certificates of participation, or other evidences of
indebtedness of the agency pending expenditure of the proceeds for
the authorized purpose of their issuance.  In connection with these
deposits of proceeds, the Local Agency Investment Fund is authorized
to receive and disburse moneys, and to provide information, directly
with or to an authorized officer of a trustee or fiscal agent engaged
by the local agency, the Local Agency Investment Fund is authorized
to hold investments in the name and for the account of that trustee
or fiscal agent, and the Controller shall maintain a separate account
for each deposit of proceeds.
   (e) The local governmental unit, the nonprofit corporation, or the
quasi-governmental agency has the exclusive determination of the
length of time its money will be on deposit with the Treasurer.
   (f) The trustee or fiscal agent of the local governmental unit has
the exclusive determination of the length of time proceeds from the
issuance of bonds will be on deposit with the Treasurer.
   (g) The Local Investment Advisory Board shall determine those
quasi-governmental agencies which qualify to participate in the Local
Agency Investment Fund.
   (h) The Treasurer may refuse to accept deposits into the fund if,
in the judgment of the Treasurer, the deposit would adversely affect
the state's portfolio.
   (i) The Treasurer may invest the money of the fund in securities
prescribed in Section 16430.  The Treasurer may elect to have the
money of the fund invested through the Surplus Money Investment Fund
as provided in Article 4 (commencing with Section 16470) of Chapter 3
of Part 2 of Division 4 of Title 2.
   (j) Money in the fund shall be invested to achieve the objective
of the fund which is to realize the maximum return consistent with
safe and prudent treasury management.
   (k) All instruments of title of all investments of the fund shall
remain in the Treasurer's vault or be held in safekeeping under
control of the Treasurer in any federal reserve bank, or any branch
thereof, or the Federal Home Loan Bank of San Francisco, with any
trust company, or the trust department of any state or national bank.

   (l) Immediately at the conclusion of each calendar quarter, all
interest earned and other increment derived from investments shall be
distributed by the Controller to the contributing governmental units
or trustees or fiscal agents, nonprofit corporations, and
quasi-governmental agencies in amounts directly proportionate to the
respective amounts deposited in the Local Agency Investment Fund and
the length of time the amounts remained therein.  An amount equal to
the reasonable costs incurred in carrying out the provisions of this
section, not to exceed a maximum of one-half of 1 percent of the
earnings of this fund, shall be deducted from the earnings prior to
distribution.  The amount of this deduction shall be credited as
reimbursements to the state agencies, including the Treasurer, the
Controller, and the Department of Finance, having incurred costs in
carrying out the provisions of this section.
   (m) The Treasurer shall prepare for distribution a monthly report
of investments made during the preceding month.
   (n) As used in this section, "local agency," "local governmental
unit," and "local governmental official" includes a campus or other
unit and an official, respectively, of the California State
University who deposits moneys in funds described in Sections 89721,
89722, and 89725 of the Education Code.



16429.2.  There is created the Local Investment Advisory Board
consisting of five members.  The chairman shall be the State
Treasurer or his or her designated representative.  Two members who
are qualified by training and experience in the field of investment
or finance, shall be appointed by the State Treasurer.  Two members
who are treasurers, finance or fiscal officers or business managers,
employed by any county, city or local district or municipal
corporation of this state, shall be appointed by the Treasurer.
   The term of office of each appointed member of the board is two
years, but each appointed member serves at the pleasure of the
appointing authority.  A vacancy in the appointed membership,
occurring other than by expiration of term, shall be filled in the
same manner as the original appointment, but for the unexpired term
only.
   Members of the board who are not state officers or employees shall
not receive a salary, but shall be entitled to a per diem allowance
of fifty dollars () for each day's attendance at a meeting of the
board, not to exceed three hundred dollars (0) in any month.  All
members shall be entitled to reimbursement for expenses incurred in
the performance of their duties under this part, including travel and
other necessary expenses.
   The board's primary purpose shall be to advise and assist the
State Treasurer in formulating the investment and reinvestment of
moneys in the Local Agency Investment Fund, and the acquisition,
retention, management, and disposition of investments of the fund.
The board, from time to time, shall review those policies and advise
therein as it considers necessary or desirable.  The board shall
advise the State Treasurer in the management of the fund and consult
the State Treasurer on any matter relating to the investment and
reinvestment of moneys in the fund.



16429.3.  Moneys placed with the Treasurer for deposit in the Local
Agency Investment Fund by cities, counties, special districts,
nonprofit corporations, or qualified quasi-governmental agencies
shall not be subject to either of the following:
   (a) Transfer or loan pursuant to Sections 16310, 16312, or 16313.

   (b) Impoundment or seizure by any state official or state agency.



16429.4.  The right of a city, county, city and county, special
district, nonprofit corporation, or qualified quasi-governmental
agency to withdraw its deposited moneys from the Local Agency
Investment Fund, upon demand, may not be altered, impaired, or
denied, in any way, by any state official or state agency based upon
the state's failure to adopt a State Budget by July 1 of each new
fiscal year.