Nevada 2021 Regular Session Status: Enacted

SB 68 — Revises provisions governing public investments. (BDR 31-399)

Last action — Approved by the Governor. Chapter 323.

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  1. ✓
    Introduced
  2. ✓
    In Committee
  3. ✓
    Passed Senate
  4. ✓
    Passed Assembly
  5. ✓
    To Executive
  6. 6
    Enacted

This bill has been enacted into law. Introduced November 18, 2020. Enacted.

Prognosis

Advancing 50% · moderate confidence

Where this bill stands today.

Odds of enactment

High

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  • Enacted

    Current position in the legislative process.

  • 1 sponsor

    1 primary, 0 co-sponsors signed on.

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Bill Text

What changed in the latest version

364 added · 391 removed

364 line(s) added, 391 removed.

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EXEMPT (Reprinted with amendments adopted on April 12, 2021) FIRST REPRINT S.B.
Senate Bill No.
68 S ENATE B ILLN O.
68–Committee on Government Affairs CHAPTER..........
68–COMMITTEE ON G OVERNMENT A FFAIRS (O NB EHALF OF THE STATE T REASURER ) PREFILED N OVEMBER 18, 2020 ____________ Referred to Committee on Government Affairs SUMMARY—Revises provisions governing public investments.
(BDR 31-399) FISCAL NOTE:
Effect on Local Government:
No.
Effect on the State:
No.
~ EXPLANATION – Matter in bolded italics is new;
matter between brackets [omitted material] is material to be omitted.
(2) the date on which the State same issuer, description, issue date and maturity is not more than 90 days aftere the date on which the counterparty purchased the securities from the State;
(2) the date on which the State commits to repurchase a security purchased by a counterparty or securities of the same issuer, description, issue date and maturity is not more than 90 days after the date on which the counterparty purchased the securities from the State;
and (3) the money received by the appointed custodian is used by the State only to purchase securities whose maturity matches or is not longer than the term of the reverse-repurchase agreement.
and (3) purchase securities whose maturity matches or is not longer than the term of the reverse-repurchase agreement.
- *SB68_R1* – 2 – the State Permanent School Fund.
Existing law charges the State Treasurer with the investment of the money in the State Permanent School Fund.
However, the State Treasurer is prohibited under existing law from making certain investments unless he or she obtains a judicial determination that such an investment does not violate the prohibition in the Nevada Constitution against the State of Nevada donating or loaning state money or credit, or subscribing to or being interested in the stock of any company, association or corporation, except a corporation that is formed for such a judicial determination, existing law authorizes the State Treasurer to transfer up to $50,000,000 from the State Permanent School Fund to a corporation for public benefit to provide private equity funding to businesses engaged in certain industries that are located or seeking to locate in Nevada.
However, the State Treasurer is prohibited under existing law from making certain investments unless he or she obtains a judicial determination that such an investment does not violate the prohibition in the Nevada Constitution against the State of Nevada donating or any company, association or corporation, except a corporation that is formed fork of educational or charitable purposes.
(NRS 355.270, 355.280) On April 20, 2011, the State Treasurer obtained a judicial determination that investment of money contained in the State Permanent School Fund in the common or preferred stock of a corporation did not violate Section 9 of Article 8 of the Nevada Constitution.
(Nev.
(In re State Treasurer, No.
Const.
11 OC 00092 1B (Nev.
Art.
First Jud.
8, § 9;
Dist.
NRS 355.060) Upon such a judicial determination, existing law authorizes the State Treasurer to transfer up to $50,000,000 from the State Permanent School Fund to a corporation for public benefit to provide private equity funding to businesses engaged in certain industries that are located or seeking to locate in Nevada.
(NRS 355.270, 355.280) On April 20, 2011, the State Treasurer obtained a judicial determination that investment of money contained in the State Permanent School Fund in the common or preferred stock of a corporation did not violate Section 9 of Article 8 of the Dist.
20, 2011)) Section 2 of this bill increases the maximum amount of School Fund to the corporation for public benefit to provide such private equity funding from $50,000,000 to $75,000,000.
20, 2011)) Section 2 of this bill increases the maximum amount of money the State Treasurer is authorized to transfer from the State Permanent School Fund to the corporation for public benefit to provide such private equity funding from $50,000,000 to $75,000,000.
Existing law authorizes the board of trustees of a school district to apply to the State Treasurer for a guarantee agreement whereby money in the State Permanent School Fund may be used to guarantee the payment of the debt service on bonds to be issued by the school district.
- 81st Session (2021) – 2 – Existing law authorizes the board of trustees of a school district to apply to the State Treasurer for a guarantee agreement whereby money in the State Permanent School Fund may be used to guarantee the payment of the debt service on bonds to be issued by the school district.
Under existing law, the State Treasurer is authorized to use money in the State Permanent School Fund to guarantee up to $40,000,000 in bonds issued by a school district at any one time.
Under existing law, the State Treasurer is $40,000,000 in bonds issued by a school district at any one time.
(NRS 387.516) Section 3 of this bill increases the maximum allowable amount of outstanding bonUpon receipt of an application for such a guarantee agreement from a school district, existing law requires the State Treasurer to provide a copy of the application to the Executive Director of the Department of Taxation.
(NRS 387.516) Section 3 of this bill increases the maximum allowable amount of outstanding bonds of a school district that may be so guaranteed to $60,000,000.
The Executive Director is required under existing law to:
Upon receipt of an application for such a guarantee agreement from a school district, existing law requires the State Treasurer to provide a copy of the application to the Executive Director of the Department of Taxation.
(1) investigate the ability of the school district to make timely payments on the debt service of the bonds for which the guarantee is requested;
The Executive district to make timely payments on the debt service of the bonds for which theschool guarantee is requested;
(NRS 387.516) Existing law prescribes certain conditions including a requirement that the State Board of Finance approve the reportagreement, submitted to it by the Executive Director.
(NRS 387.516) Existing law prescribes certain conditions under which the State Treasurer is authorized to enter into the guarantee agreement, submitted to it by the Executive Director.
- *SB68_R1* – 3 – THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:
EXPLANATION – Matter in bolded italics is new;
matter between brackets [omitted material] is material to be omitted.
THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:
(e) Bonds of any county of this state or of other states;
- 81st Session (2021) – 3 – (f) Bonds of incorporated cities in this state or in other states of the Union, including special assessment district bonds if those bonds provide that any deficiencies in the proceeds to pay the bonds are to be paid from the general fund of the incorporated city;
(f) Bonds of incorporated cities in this state or in other states of the Union, including special assessment district bonds if those bonds provide that any deficiencies in the proceeds to pay the bonds are to be paid from the general fund of the incorporated city;
is 200,000 or more and which is situated in two or more counties of this state or of any other state, if:
(i) Bonds of any general improvement district whose population is 200,000 or more and which is situated in two or more counties of this state or of any other state, if:
and (2) That property is of an assessed valuation of not less than five times the amount of the bonded indebtedness of the district;
and five times the amount of the bonded indebtedness of the district;than (j) Medium-term obligations for counties, cities and school districts authorized pursuant to chapter 350 of NRS;
(j) Medium-term obligations for counties, cities and school districts authorized pursuant to chapter 350 of NRS;
(k) Loans bearing interest at a rate determined by the State Board of Finance when secured by first mortgages on agricultural lands in this state of not less than three times the value of the amount loaned, exclusive of perishable improvements, and of unexceptional title and free from all encumbrances;
(k) Loans bearing interest at a rate determined by the State Board of Finance when secured by first mortgages on agricultural lands in this state of not less than three times the value of the - *SB68_R1* – 4 – amount loaned, exclusive of perishable improvements, and of unexceptional title and free from all encumbrances;
§§ 2001 to 2259, inclusive, and bonds, debentures, consolidated debentures and other obligations issued by banks for cooperatives under the authority of the Farm Credit Act of 1933, formerly 12 U.S.C.
§§ 2001 to 2259, inclusive, and bonds, debentures, consolidated debentures and other obligations issued by 1933, formerly 12 U.S.C.
§§ 1131 to 1138e, inclusive, and the Farm Credit Act of 1971, 12 U.S.C.
§§ 1131 to 1138e, inclusive, and the Farmof Credit Act of 1971, 12 U.S.C.
(n) Bankers’ acceptances of the kind and maturities made eligible by law for rediscount with Federal Reserve banks or trust companies which are members of the Federal Reserve System, except that acceptances may not exceed 180 days’ maturity, and may not, in aggregate value, exceed 20 percent of the total par value of the portfolio as determined at the time of purchase;
- 81st Session (2021) – 4 – eligible by law for rediscount with Federal Reserve banks or trust companies which are members of the Federal Reserve System, except that acceptances may not exceed 180 days’ maturity, and may not, in aggregate value, exceed 20 percent of the total par value of the portfolio as determined at the time of purchase;
If the rating of an obligation is reduced to a level that does not meet the requirements of this paragraph, the State Treasurer shall take such action as he or she deems appropriate to preserve the principal value and integrity of the portfolio as a whole and report to the State Board of Finance any action taken by the State Treasurer pursuant to this paragraph;
If the rating of an of this paragraph, the State Treasurer shall take such action as he or she deems appropriate to preserve the principal value and integrity of the portfolio as a whole and report to the State Board of Finance any action taken by the State Treasurer pursuant to this paragraph;
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(p) Notes, bonds and other unconditional obligations for the payment of money, except certificates of deposit that do not qualify pursuant to paragraph (m), issued by corporations organized and operating in the United States or by depository institutions licensed - *SB68_R1* – 5 – by the United States or any state and operating in the United States that:
(p) Notes, bonds and other unconditional obligations for the payment of money, except certificates of deposit that do not qualify pursuant to paragraph (m), issued by corporations organized and operating in the United States or by depository institutions licensed by the United States or any state and operating in the United States that:
and (3) Are rated by a nationally recognized rating service as “A” or its equivalent, or better, except that investments pursuant to this paragraph may not, in aggregate value, exceed 25 percent of the total par value of the portfolio as determined at the time of purchase.
and (3) Are rated by a nationally recognized rating service as “A” or its equivalent, or better, aggregate value, exceed 25 percent of the total par value of the portfolio as determined at the time of purchase.
(q) A bond, note or other obligation issued or unconditionally guaranteed by the International Bank for Reconstruction and Development, the International Finance Corporation or the Inter- American Development Bank that:
(q) A bond, note or other obligation issued or unconditionally guaranteed by the International Bank for Reconstruction and - 81st Session (2021) – 5 – Development, the International Finance Corporation or the Inter- American Development Bank that:
(3) At the time of purchase has a remaining term to maturity of 5 years or less;
of 5 years or less;
and (4) Is rated by a nationally recognized rating service as “AA” or its equivalent, or better, except that investments pursuant to this paragraph may not, in aggregate value, exceed 15 percent of the total par value of the portfolio as determined at the time of purchase;
andof purchase has a remaining term to maturity (4) Is rated by a nationally recognized rating service as “AA” or its equivalent, or better, except that investments pursuant to this paragraph may not, in aggregate value, exceed 15 percent of the total par value of the portfolio as determined at the time of purchase;
and (7) Is rated by a nationally recognized rating service as “AA” or its equivalent, or better, except that investment pursuant to this paragraph may not, in aggregate value, exceed 10 percent of the total par value of the portfolio as determined at the time of purchase;
and (7) Is rated by a nationally recognized rating service as “AA” or its equivalent, or better, except that investment pursuant to this paragraph may not, in aggregate value, exceed 10 percent of the total par value of the por(s) Money market mutual funds which:purchase;
- *SB68_R1* – 6 – (s) Money market mutual funds which:
Repurchase agreements and reverse-repurchase agreements are proper and lawful investments of money of the State and the State Insurance Fund for the purchase or sale of securities which are negotiable and of the types listed in subsection 1 if made in accordance with the following conditions:
Repurchase agreements and reverse-repurchase agreements are proper and lawful investments of money of the State and the State Insurance Fund for the purchase or sale of securities which are - 81st Session (2021) – 6 – accordance with the following conditions:section 1 if made in (a) The State Treasurer shall designate in advance and thereafter maintain a list of qualified counterparties which:
(a) The State Treasurer shall designate in advance and thereafter maintain a list of qualified counterparties which:
The master repurchase agreement and master reverse-repurchase agreement must require the prompt delivery to the State Treasurer and the appointed custodian of written confirmations of all transactions conducted thereunder, and must be developed giving consideration to the Federal Bankruptcy Act, 11 U.S.C.
The master repurchase agreement and master reverse-repurchase agreement must require the prompt delivery to the State Treasurer and the appointed custodian of written confirmations of all transactions conducted thereunder, and Act, 11 U.S.C.
§§ 101 et seq.
§§ 101 et seq.ideration to the Federal Bankruptcy (b) In all repurchase agreements:
(b) In all repurchase agreements:
- *SB68_R1* – 7 – (II) Notify the State when the securities are marked to the market if the required margin on the agreement is not maintained;
(II) Notify the State when the securities are marked to the market if the required margin on the agreement is not maintained;
(III) Hold the securities separate from the assets of the custodian;
(III) Hold the securities separate from the assets of the custodian;(IV) Report periodically to the State concerning the market value of the securities;
and (IV) Report periodically to the State concerning the market value of the securities;
(3) The market value of the purchased securities must exceed percent of the repurchase price to be paid by the counterparty and the value of the purchased securities must be marked to the market weekly;
(3) The market value of the purchased securities must exceed 102 percent of the repurchase price to be paid by the counterparty and the value of the purchased securities must be marked to the market weekly;
and (5) The purchased securities must not have a term to maturity at the time of purchase in excess of 10 years.
and - 81st Session (2021) – 7 – (5) The purchased securities must not have a term to maturity at the time of purchase in excess of 10 years.
(1) The State must enter into a written contract with the appointed custodian which authorizes the custodian to transfer the securities underlying the reverse-repurchase agreement only at or after the time at which money to pay the purchase price of the securities is transferred to the custodian;
(1) The State must enter into a written contract with the securities underlying the reverse-repurchase agreement only at ore after the time at which money to pay the purchase price of the securities is transferred to the custodian;
(2) The date on which the State commits to repurchase a security purchased by a counterparty or securities of the same issuer, description, issue date and maturity must not be more than 90 days after the date on which the counterparty purchased the securities from the State;
(2) The date on which the State commits to repurchase a security purchased by a counterparty or securities of the same issuer, description, issue date and maturity must not be more than days after the date on which the counterparty purchased the securities from the State;
(b) “Repurchase agreement” means a purchase of securities by the State or State Insurance Fund from a counterparty which commits to repurchase those securities or securities of the same issuer, description, issue date and maturity on or before a specified date for a specified price.
(b) “Repurchase agreement” means a purchase of securities by commits to repurchase those securities or securities of the same issuer, description, issue date and maturity on or before a specified date for a specified price.
- *SB68_R1* – 8 – [4.
[4.
355.280 If the State Treasurer obtains the judicial determination required by subsection 3 of NRS 355.060, the State Treasurer may transfer an amount not to exceed [$50 million] $75,000,000 from the State Permanent School Fund to the corporation for public benefit.
355.280 If the State Treasurer obtains the judicial determination required by subsection 3 of NRS 355.060, the State Treasurer may transfer an amount not to exceed [$50 million] - 81st Session (2021) – 8 – $75,000,000 from the State Permanent School Fund to the corporation for public benefit.
1.
companies described in subsection 1 of NRS 355.270, private equitylity funding;
Provide, through the limited partnerships or limited-liability companies described in subsection 1 of NRS 355.270, private equity funding;
The board of trustees of a school district may apply to the State Treasurer for a guarantee agreement whereby money in the State Permanent School Fund is used to guarantee the payment of the debt service on bonds that the school district will issue.
The board of trustees of a school district may apply to the State Treasurer for a guarantee agreement whereby payment of the debt service on bonds that the school district will issue.
- *SB68_R1* – 9 – 2.
2.
As soon as practicable after receipt of a copy of an application, the Executive Director shall investigate the ability of the school district to make timely payments on the debt service of the bonds for which the guarantee is requested.
As soon as practicable after receipt of a copy of an application, the Executive Director shall investigate the ability of - 81st Session (2021) – 9 – the school district to make timely payments on the debt service of the bonds for which the guarantee is requested.
[1.] (a) The report submitted by the Executive Director indicates that a school district has the ability to make timely payments on the debt service of the bonds;
[1.] (a) The report submitted by the Executive Director indicates that a school district has the ability to make timely pay[2.
[2.
The] the debt service of the bonds;
The] (b) Except as otherwise provided in subsection 2, the State Board of Finance approves the report submitted by the Executive Director;
(b) Except as otherwise provided in subsection 2, the State Board of Finance approves the report submitted by the Executive Director;
H - *SB68_R1*
~~~~~ 21 - 81st Session (2021)
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Amendments

1 amendment

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Action History

  1. Approved by the Governor. Chapter 323.

  2. Enrolled and delivered to Governor.

  3. From committee: Do pass. Declared an emergency measure under the Constitution. Read third time. Passed. Title approved. (Yeas: 26, Nays: 16.) To Senate. In Senate. To enrollment.

  4. In Assembly. Read first time. Referred to Committee on Ways and Means. To committee.

  5. Read third time. Amended. (Amend. No. 54.) To printer. From printer. To engrossment. Engrossed. First reprint. Read third time. Passed, as amended. Title approved. (Yeas: 18, Nays: 3.) To Assembly.

  6. Taken from General File. Placed on General File for next legislative day.

  7. From committee: Amend, and do pass as amended.

  8. Notice of eligibility for exemption. Read second time. Taken from General File. Re-referred to Committee on Finance. To committee. Exemption effective.

  9. From committee: Do pass.

  10. Read first time. To committee.

  11. From printer.

  12. Prefiled. Referred to Committee on Government Affairs. To printer.

Sponsors

  • Senate Committee on Government Affairs · Primary

Sponsorship breakdown

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1 sponsors · 0 co-sponsors · 66 not signed on

Sponsors (1)

  • Senate Committee on Government Affairs

Co-sponsors (0)

None.

Not signed on (66)

66 members have not signed on to this bill.

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"Not signed on" means a member has not sponsored or co-sponsored this bill — it does not imply opposition. Members flagged Voted No have a recorded No vote on this bill.

Whip count is in markup. Polling the chamber and every recorded vote this session. Only the first open is slow. It’s instant for you after this. Calling the roll · Tallying · Engrossing

Subjects

finance
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SB 68 is sponsored by Senate Committee on Government Affairs.
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This bill has been enacted into law. Introduced November 18, 2020. Enacted.
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