Investment of Funds by Political Subdivisions, the official text

(Text matches printed bills. Document has been reformatted to meet World Wide Web specifications.)

(A223, R226, S420)

AN ACT TO AMEND THE SOUTH CAROLINA CODE OF LAWS BY AMENDING SECTION 6-5-10, RELATING TO AUTHORIZED INVESTMENTS OF FUNDS BY POLITICAL SUBDIVISIONS, SO AS TO AUTHORIZE CERTAIN INVESTMENT-GRADE CORPORATE DEBT INVESTMENTS BY QUALIFIED RETIREE POST-EMPLOYMENT BENEFITS TRUSTS AND TO PROVIDE REQUIREMENTS AND LIMITATIONS FOR SUCH INVESTMENTS.

Be it enacted by the General Assembly of the State of South Carolina:

Investment in certain U.S. corporate-issued debt instruments authorized

SECTION 1. Section 6-5-10 of the S.C. Code is amended by adding:

(9)(a) A qualified retiree post-employment benefits trust may invest in notes, bonds, debentures, or other debt instruments issued by a United States corporation, provided that the instruments are rated investment grade by at least two of the following nationally recognized statistical rating organizations: S&P Global Ratings, Moody's Investors Service, and Fitch Ratings. The lowest rating assigned by any of the rating organizations shall control. Further, if an instrument held pursuant to this item is subsequently downgraded below investment grade by any such rating organization, the governing body of the political subdivision shall take prudent action within a reasonable period of time to address such downgrade, consistent with its fiduciary duties.

(b) Assets invested pursuant to this item must be separately accounted for and shall not be commingled with other funds of the political subdivision for purposes of investment authority under this section.

(c) Notwithstanding any other provision of this section, the investment authority provided in this item applies exclusively to assets held in a qualified retiree post-employment benefits trust and shall not apply to any other funds of a political subdivision.

(d) For purposes of this item, a qualified retiree post-employment benefits trust means a trust to provide for the employer costs of retiree post-employment benefits for retired employees of political subdivisions of the State.

Severability

SECTION 2. If any section, subsection, paragraph, subparagraph, sentence, clause, phrase, or word of this act is for any reason held to be unconstitutional or invalid, such holding shall not affect the constitutionality or validity of the remaining portions of this act, the General Assembly hereby declaring that it would have passed this act, and each and every section, subsection, paragraph, subparagraph, sentence, clause, phrase, and word thereof, irrespective of the fact that any one or more other sections, subsections, paragraphs, subparagraphs, sentences, clauses, phrases, or words hereof may be declared to be unconstitutional, invalid, or otherwise ineffective.

Time effective

SECTION 3. This act takes effect upon approval by the Governor.

Ratified the 15th day of May, 2026.

Approved the 19th day of May, 2026.

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