An act TO AMEND THE LAW CONCERNING THE INVESTMENT OF 10 STATE FUNDS, the official text

Stricken language would be deleted from and underlined language would be added to present law.

1 State of Arkansas                 A Bill
2 95th General Assembly

3 Regular Session, 2025                                      SENATE BILL 480

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5 By: Senator K. Hammer

6 By: Representative Wing

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8                          For An Act To Be Entitled

9         AN ACT TO AMEND THE LAW CONCERNING THE INVESTMENT OF

10        STATE FUNDS; AND FOR OTHER PURPOSES.

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13                                      Subtitle

14                       TO AMEND THE LAW CONCERNING THE

15                       INVESTMENT OF STATE FUNDS.

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17 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF ARKANSAS:

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19        SECTION 1. Arkansas Code � 19-3-518(b)(1)(B)(vii)--(xiv), concerning

20 the investment of state funds in the State Treasury in securities and bank

21 certificates of deposit, are amended to read as follows:

22                         (vii) Obligations issued by the State Board of

23 Education under authority of the Arkansas Constitution or applicable statutes

24 that are not general obligations of a municipality, county, or other

25 political subdivision of the state;

26                         (viii) Warrants of a political subdivision or

27 municipality of the State of Arkansas having maturities not exceeding one (1)

28 year;

29                         (ix) Prerefunded municipal bonds, if the principal

30 and interest of the municipal bonds are fully secured by the principal and

31 interest of a direct obligation of the United States Government;

32                         (x) The sale of federal funds with a maturity of not

33 more than one (1) business day;

34                         (xi) Demand, savings, or time deposits or accounts

35 of a depository institution chartered by the United States, a state of the

36 United States, or the District of Columbia if funds invested in the demand,

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1 savings, or time deposits or accounts are fully insured by a federal deposit

2 insurance agency;

3                       (xii)(ix) Repurchase agreements that are fully

4 collateralized by securities stated in subdivisions (b)(1)(B)(ii)-(v) of this

5 section if the repurchase agreement provides for taking delivery of the

6 collateral directly or through an authorized custodian;

7                       (xiii)(x) A securities or other interest in an open-

8 end type investment company or investment trust registered under the

9 Investment Company Act of 1940 and that is defined as a "money market fund"

10 under 17 C.F.R. � 270.2a-7 if:

11                      (a) The portfolio of the investment company or

12 investment trust is limited principally to United States Government

13 obligations and to repurchase agreements fully collateralized by United

14 States Government obligations; and

15                      (b) The investment company or investment trust

16 takes delivery of the collateral either directly or through an authorized

17 custodian; or

18                      (xiv)(xi) As approved by the guidelines established

19 by the State Treasury investment policy approved by the State Board of

20 Finance, a corporate obligation with an investment grade rating of at least

21 BBB, A2, P2, or an equivalent rating as indicated by at least two (2) one (1)

22 nationally recognized statistical rating organizations.

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24  SECTION 2. Arkansas Code � 19-3-518(b)(3)(B), concerning the

25 investment of state funds in the State Treasury in securities and bank

26 certificates of deposit, is amended to read as follows:

27                   (B) All purchases and sales of securities by the Treasurer

28 of State shall be made using a competitive procedure that:

29                      (i) Is approved by the State Board of Finance; and

30                      (ii) Has the goals of:

31                      (a) Obtaining the optimal price and value for

32 the securities; and

33                      (b) Not showing preference toward any

34 securities broker.

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36  SECTION 3. Arkansas Code � 19-3-518(d)(5), concerning the investment

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1 of funds deposited into the State Treasury by state agencies, boards, and

2 commissions that were previously held as cash funds in a bank depository or

3 investment depository, is amended to read as follows:

4   (5) On the second business day that the State Treasury is open

5 after the twenty-fifth day of the month, the Treasurer of State shall

6 transfer or credit to the participants of the fund interest earned on all

7 State Treasury funds invested as authorized under this section during the

8 preceding month less the proportionate share of any assessments for the

9 expenses of administration.

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