AB 338 — Revises provisions governing the investment of certain public money in foreign bonds, notes or other obligations. (BDR 31-787)

or - 81st Session (2021) – 5 – (c) Become an endorser, surety or obligor for money that is borrowed from the Trust Fund.

If the annual actuarial study performed pursuant to NRS 353B.190 reveals that there is insufficient money to ensure the actuarialterms soundness of thesubsequent Trustprepaid Fund,tuition thecontracts.rd Board shall modify the terms11. of subsequent prepaid tuition contracts.

11.

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.

- *AB338* – 6 – (1) Is denominated in United States dollars;

and [(7)]- (6)81st IsSession rated(2021) by– a6 nationally– recognized rating service as [“AA”] “A” or its equivalent, or better,better,y recognized rating service as  except that investments 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.

(i) Loans at a rate of interest of not less than 6 percent per annum, secured by mortgage on agricultural lands in this state of not less than three times the value of the amount loaned, exclusive ofofnot perishable improvements, of unexceptional title and free from all encumbrances.

(1)(1)(I) TheListed stockon ofa thenational corporationstock is:exchange;

(I)or Listed(II) onTraded ain nationalthe over-the-counter market, if the price quotations for the over-the-counter stock exchange;are quoted by the National Association of Securities Dealers Automated Quotation System (NASDAQ);

or - *AB338* – 7 – (II) Traded in the over-the-counter market, if the price quotations for the over-the-counter stock are quoted by the National Association of Securities Dealers Automated Quotation System (NASDAQ);

- 81st Session (2021) – 7 – (3) The maximum investment in stock is not greater than 50 percent of the book value of the total investments of the State Permanent School Fund;

(4) Except for investments made pursuant to paragraph (m), the amount of an investment in a single corporation is not greater than 3 percent of the book value of the assets of the State Permanent School Fund;

The State Treasurer shall not invest any money in the State Permanent School Fund pursuant to paragraph (k), (l), (m) or (n) of subsection 2 unless the State Treasurer obtains a judicial determination that the proposed investment or category ofofl investments will not violate the provisions of Section 9 of Article 8 of the Constitution of the State of Nevada.

In addition to the investments authorized by subsection 2, the State Treasurer may make loans of money from the State - *AB338* – 8 – Permanent School Fund to school districts pursuant to NRS 387.526.

- 81st Session (2021) – 8 – Sec.

In addition to other investments provided for by a specific statute, the following bonds and other securities are proper and lawful investments of any of the money of this state, of its variousInsurance departments,Fund:ents, institutions and agencies, and of the State Insurance(a) Fund:Bonds and certificates of the United States;

(a) Bonds and certificates of the United States;

(h) Bonds of school districts within this state;

(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 - *AB338* – 9 – amount loaned, exclusive of perishable improvements, and of unexceptional title and free from all encumbrances;

(l)- Farm81st loanSession bonds,(2021) consolidated– farm9 loan– bonds, debentures, consolidated debentures and other obligations issued by federal land banks and federal intermediate credit banks under the authority of the Federal Farm Loan Act, formerly 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,System,or trust 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;

(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 - 81st Session (2021) – 10 – operating in the United States or by depository institutions licensed - *AB338* – 10 – by the United States or any state and operating in the United States that:

(2) At the time of purchase have a remaining term to maturity of not more than 5 years;

andande a remaining term to (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 (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 aggregateportfolio value,as exceeddetermined 15at percent of the totaltime parof purchase;par value of the portfolio(r) asA determinedbond, atnote or other obligation publicly issued in the timeUnited ofStates purchase;by a foreign financial institution, corporation or government that:

(r) A bond, note or other obligation publicly issued in the United States by a foreign financial institution, corporation or government that:

and [(7)] (6) Is rated by a nationally recognized rating service as [“AA”] “A” or its equivalent, or better, - except81st thatSession investment(2021) pursuant– to11 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;

- *AB338* – 11 – (s) Money market mutual funds which:

Repurchase agreements are proper and lawful investments of money of the State and the State Insurance Fund for the purchase or salesubsection of1 securitiesif whichmade arein negotiableaccordance andwith of the typesfollowing listedconditions:n in(a) subsectionThe 1State ifTreasurer madeshall designate in accordanceadvance withand thethereafter followingmaintain conditions: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 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,Act(b) 11In U.S.C.all repurchase agreements:

§§ 101 et seq.

(b) In all repurchase agreements:

- 81st Session (2021) – 12 – (I) Disburse cash for repurchase agreements only upon receipt of the underlying securities;

- *AB338* – 12 – (III) Hold the securities separate from the assets of the custodian;

andand) Hold the securities separate from the assets of the (IV) Report periodically to the State concerning the market value of the securities;

(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;

(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.

- 81st Session (2021) – 13 – (b) 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:

(1) Is denominated in United States dollars;

- *AB338* – 13 – (3) At the time of purchase has a remaining term to maturity of 5 years or less;

and [(7)] (6) Is rated by a nationally recognized rating service as [“AA”] “A” or its equivalent, or better,  except that investments 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.

(f)- Obligations81st ofSession an(2021) agency– or14 instrumentality– of the United States of America or a corporation sponsored by the government,government,d the maturity date of which is not more than 10 years after the date of purchase.

- *AB338* – 14 – (h) Securities which have been expressly authorized as investments for local governments by any provision of Nevada Revised Statutes or by any special law.

For the purposes of this paragraph, any reference in NRS 356.133 to a “county treasurer” or “board of county commissioners” shall be deemed to refer to the appropriate financial officer or governing body of the local government purchasing the certificates.

(1) If:(I) The interest on the obligation is exempt from gross income for federal income tax purposes;

(I) The interest on the obligation is exempt from gross income for federal income tax purposes;

- 81st Session (2021) – 15 – (m) Commercial paper issued by a corporation organized and operating in the United States or by a depository institution licensed by the United States or any state and operating in the United States that:

(1) At the time of purchase has a remaining term to maturity of no more than 270 days;

andandchase has a remaining term to maturity (2) Is rated by a nationally recognized rating service as “A- 1,” “P-1” 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 not more than - *AB338* – 15 – 5 percent of the total par value of the portfolio may be invested in commercial paper issued by any one corporation or depository institution.

(1) Are registered with the Securities and Exchange Commission;Commiss(2) Are rated by a nationally recognized rating service as “AAA” or its equivalent;

(2) Are rated by a nationally recognized rating service as “AAA” or its equivalent;

2.- 81st Session (2021) – 16 – money of a governing body of a local government for the purchaseof 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 are proper and lawful investments of money of a governing body of a local government 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:

and - *AB338* – 16 – (3) Have executed a written master repurchase agreement in a form satisfactory to the governing body of the local government pursuant to which all repurchase agreements are entered into.

The master repurchase agreement must require the prompt delivery to the governing body of the local government and the appointed custodian of written confirmations of all transactions conducted thereunder, and must be developed giving consideration to thetheted Federal Bankruptcy Act.

(II) Notify the governing body of the local government when the securities are marked to the market if the required margin on the agreementagr(III) isHold notthe maintained;securities separate from the assets of the custodian;

(III) Hold the securities separate from the assets of the custodian;

(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;

(4)- The81st dateSession on(2021) which– the17 securities– are to be repurchased must not be more than 90 days after the date of purchase;

andandased (5) The purchased securities must not have a term to maturity at the time of purchase in excess of 10 years.

The securities described in paragraphs (a), (d) and (e) of subsection 1 and the repurchase agreements described in subsection 2 may be purchased when, in the opinion of the governing body of the local government, there is sufficient money in any fund of the local government to purchase those securities and the purchase will not result in the impairment of the fund for the purposes for which it was created.

When the governing body of the local government has determined that there is available money in any fund or funds for the purchase of bonds as set out in subsection 1 or 2, those purchases may be made and the bonds paid for out of any one or more of the - *AB338* – 17 – funds, but the bonds must be credited to the funds in the amounts purchased, and the money received from the redemption of the bonds, as and when redeemed, must go back into the fund or funds from which the purchase money was taken originally.originally.fund or funds 5.

5.

This section does not authorize the investment of money administered pursuant to a contract, debenture agreement or grant in agrant.er manner not authorized by the terms of the contract, agreement or grant.8.

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and - 81st Session (2021) – 18 – (3) In full compliance with all applicable capital requirements.

(c) “Repurchase agreement” means a purchase of securities by the governing body of a local government from a counterparty by 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.

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