Meeting Packet — Insurance & Banking Subcommittee (February 16, 2022)
Summary
Meeting packet for the Insurance & Banking Subcommittee of the Commerce Committee, Wednesday, February 16, 2022, 8:30 AM in Morris Hall (17 HOB). The agenda lists HB 649 Transfers in Divorce by Driskell and HB 1559 Public Deposits by Harding and Rizo. The staff analysis of HB 649 describes an Individual Retirement Account (IRA) and how its assets may be transferred in a divorce by name change or direct transfer. The packet closes with the text of HB 1559, whose Section 34 provides that the act takes effect July 1, 2022.
Summary drafted by a model from the document's text below and checked by script against that text before publication. It is a navigation aid, not a reading of what the document proves. Where AI is used
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Insurance & Banking Subcommittee
Wednesday, February 16, 2022
8:30 AM - 10:00 AM
Morris Hall (17 HOB)
Meeting Packet
Chris Sprowls Nick DiCeglie
Speaker Chair
The Florida House of Representatives
Commerce Committee
Insurance & Banking Subcommittee
Chris Sprowls Nick DiCeglie
Speaker Chair
Meeting Agenda
Wednesday, February 16, 2022
8:30 AM – 10:00 AM
Morris Hall (17 HOB)
I. Call to Order
II. Roll Call
III. Welcome and Opening Remarks
IV. Consideration of the following bill(s):
• HB 649 Transfers in Divorce by Driskell
• HB 1559 Public Deposits by Harding, Rizo
V. Closing Remarks
VI. Adjournment
303 House Office Building, 402 South Monroe Street, Tallahassee, FL 32399-1300
(850) 717-4870
HB 649
HOUSE OF REPRESENTATIVES STAFF ANALYSIS
BILL #: HB 649 Transfers in Divorce
SPONSOR(S): Driskell
TIED BILLS: IDEN./SIM. BILLS: SB 968
REFERENCE ACTION ANALYST STAFF DIRECTOR or
BUDGET/POLICY CHIEF
1) Civil Justice & Property Rights Subcommittee 17 Y, 0 N Mathews Jones
2) Insurance & Banking Subcommittee Hinshelwood Luczynski
3) Judiciary Committee
SUMMARY ANALYSIS
An Individual Retirement Account (IRA) is a retirement savings account that provides the account owner with
certain tax benefits which are not available for a traditional savings account. An IRA is intended to be the
property of its owner and may only be transferred to another person upon the owner’s death or incident to
divorce during a dissolution of marriage. If an IRA is transferred to a spouse or ex-spouse incident to a divorce,
the spouse receiving the IRA becomes the new owner of the interest in the assets in the other spouse's IRA on
the effective date of the transfer. In order to effect the transfer incident to a divorce, the parties must give the
IRA custodian a copy of the court’s order directing how the account must be split, and the custodian may then
split the account or transfer the account accordingly, in a tax-free transfer. The assets in an IRA may be
transferred in a divorce by:
Name change, where the transfer is executed by changing the name of the IRA owner from that of one
spouse or former spouse to that of the other; or
Direct transfer, where the assets in one spouse's IRA are directly transferred or rolled over to a new or
existing IRA of the other spouse.
Under the U.S. Bankruptcy Code, a state may specify assets which are exempt from creditors’ claims in a
bankruptcy proceeding, and Florida has done so. Florida law provides a number of exemptions for various
retirement related assets, such as IRAs. Florida provides protection against creditor claims for IRA accounts
that are exempt from taxation under s. 408 of the Internal Revenue Code (IRC), and the IRC tax exemption for
an IRA account awarded incident to a divorce provides tax-exempt status for a former spouse’s interest in such
an account at the time the transfer is made, and thereafter. Although there is no current controversy in Florida
regarding the protection afforded an IRA account awarded incident to a divorce, recent bankruptcy court
decisions from other jurisdictions may indicate the need to clarify such protection under Florida law.
HB 649 clarifies that any interest in an IRA awarded or received in a transfer incident to divorce is exempt from
creditors upon being awarded or received and remains exempt from creditors’ claims after the transfer is
complete. The bill applies retroactively to all transfers made incident to divorce.
The bill has an indeterminate fiscal impact on the private sector but does not appear to have a fiscal impact on
state or local government.
The bill is effective upon becoming a law.
This docum ent does not reflect the intent or official position of the bill sponsor or House of Representatives .
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FULL ANALYSIS
I. SUBSTANTIVE ANALYSIS
A. EFFECT OF PROPOSED CHANGES:
Background
The Employee Retirement Income Security Act (ERISA)
ERISA is a federal law that sets minimum standards for most voluntarily established retirement plans in
the private industry to provide protection for individuals in those plans.1 ERISA identifies requirements
for plans for the protection of plan participants.
401(k) Plan
A 401(k) plan is a feature of a qualified profit-sharing plan that allows employees to contribute a portion
of their wages to individual accounts.2 An employee’s elective contributions are excluded from the
employee’s taxable income; however, distributions, including earnings, are considered taxable income
at retirement.
Individual Retirement Accounts
An Individual Retirement Account (IRA) is “…a trust created or organized in the United States for the
exclusive benefit of an individual or his beneficiaries.” 3 An IRA is created by a written document which
shows that the account meets the following criteria: 4
The account’s trustee or custodian must be a bank, federally insured credit union, savings and
loan association, or other entity approved by the Internal Revenue Service (IRS) to act as such.
The trustee or custodian generally may not accept contributions in an amount more than the
account’s deductible amount for the year, but rollover contributions and employer contributions
to a simplified employee pension (SEP) 5 can be more than this amount.
Contributions, except for rollover contributions, must be in cash.
The account owner must have a non-forfeitable right to the amount in the account at all times.
Money in the account cannot be used to buy a life insurance policy.
Assets in the account cannot be combined with other property, except in a common trust fund or
common investment fund.
The account owner must begin receiving distributions from the account in April of the year after
he or she reaches age 70 1/2.6
An IRA may be a traditional IRA or a Roth IRA. While a traditional IRA allows an account owner to
make tax deductible contributions into the account and defer being taxed on the income until making
1 U.S. Department of Labor, Employee Retirement Income Security Act (ERISA), https://www.dol.gov/general/topic/retirement/erisa (last
visited Feb. 7, 2022).
2
Internal Revenue Service, 401(k) Plans, (Sep. 23, 2020), https://www.irs.gov/retirement-plans/401k-plans (last visited Feb. 7, 2022).
3 26 U.S.C. s. 408(a).
4 IRS Publication 590-A, Contrib utions to Individual Retirement Arrangements (IRAs), (2021), https://www.irs.gov/publications/p590a
(last visited Feb. 7, 2022).
5 An SEP is a written arrangement that allows your employer to make deductible contributions to a traditional IRA (an SEP IRA) set up
for the account owner to receive such contributions. Generally, distributions from SEP IRAs are subject to the wit hdrawal and tax rules
that apply to traditional IRAs. Id.
6 The federal Setting Every Community Up for Retirement Enhancement Act of 2019 (SECURE Act) became law on December 20,
2019, and made changes to the required minimum distribution rules for IRAs. If you reached the age of 70½ in 2019, the prior rule
applies, and you must take your first required minimum distribution by April 1, 2020. If you reach age 70 ½ in 2020 or later, you must
take your first required minimum distribution by April 1 of the year after you reach age 72. Internal Revenue Service, Retirement Plan
and IRA Required Minimum Distributions FAQs, https://www.irs.gov/retirement-plans/retirement-plans-faqs-regarding-required-
minimum-distributions (last visited Feb. 14, 2022).
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withdrawals after retirement,7 a Roth IRA allows an account owner to make non-tax-deductible
contributions into the account and make tax-free withdrawals after retirement.8
An IRA is intended to be the property of its owner and may only be transferred to another person upon
the owner’s death or incident to divorce in a dissolution of marriage proceeding. When an IRA account
owner dies, the account may be transferred to a named beneficiary.
If the beneficiary is not the account owner’s spouse, the IRA is considered an inherited IRA. 9 The
beneficiary of an inherited IRA:
May not make contributions to the account;
Must make withdrawals regardless of his or her age; and
Is not subject to a penalty for early withdrawals from the account.
If the beneficiary is the account owner’s spouse, the beneficiary may do one of the following: 10
Treat the IRA as his or her own IRA by designating himself or herself as the account owner;
Treat the IRA as his or her own by rolling it over into his or her own IRA, or to the extent it is
taxable, into a:
o Qualified employer plan;
o Qualified employee annuity plan (section 403(a) plan);
o Tax-sheltered annuity plan (section 403(b) plan); or
o State or local government deferred compensation plan (section 457 plan).
Treat himself or herself as the beneficiary of the IRA.
When an IRA is transferred to a spouse or ex-spouse incident to a divorce, the spouse receiving the
IRA becomes the new owner of the assets in the other spouse's IRA on the effective date of the
transfer. There is no legal authority for an IRA to be split or transferred until the divorce is finalized, and
a court order is entered directing how the account must be split. The parties must give the IRA
custodian a copy of the court’s order, and the custodian may then split the account or transfer the
account accordingly, in a tax-free transfer. The assets in an IRA may be transferred by:
Changing the name of the IRA owner from that of one spouse or former spouse to that of the
other; or
Making a direct transfer of the IRA assets or a portion of the assets from one spouse's IRA
directly into the other spouse’s new or existing IRA.
IRA Asset Protection
A state’s laws may affect an IRA in a case involving a trust, real estate, or a bankruptcy exemption that
protects the IRA from the claims of creditors. A person may file for bankruptcy to assist in discharging
debt or committing to a plan to repay debts. All bankruptcy cases are handled in federal courts under
rules outlined in the U.S. Bankruptcy Code (Code).11 In general, filing for bankruptcy serves two
purposes: to convert the estate of the debtor into cash and distribute it among creditors; and to give the
debtor a fresh start by providing certain exemptions and rights to assets that bankruptcy does not
reach.12 A person may file one of two primary forms of bankruptcy.13 In a proceeding under Chapter 7
of the Code, a debtor must surrender his or her assets to a trustee who then liquidates the assets and
distributes all proceeds to the debtor’s creditors.14 A Chapter 13 bankruptcy petition allows a debtor to
stay creditor actions and propose a plan to pay all creditors, thus rehabilitating the debtor financially.15
7 Id.
8 Id.
9 26 U.S.C. s. 401(a)(9).
10 IRS, supra note 2, at 20.
11 11 U.S.C. s. 101, et seq.
12 9 Am. Jur. 2d Bankruptcy s. 5.
13 An individual may also file a petition under Chapter 11, but such petitions are rare.
14 11 U.S.C. ss. 704 & 726.
15 9 Am Jur. 2d Bankruptcy s. 72.
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In either a Chapter 7 or Chapter 13 bankruptcy, a debtor may claim certain property as exempt from
creditors in the bankruptcy proceedings.16 The Code provides many exemptions to protect certain
assets from creditors’ claims, but under the Code, a state may choose to opt out of these exemptions.17
If a state chooses to opt out, the federal Code exemptions are not available to debtors within that state,
unless the state specifically opts in to a Code exemption within state law. A state may also provide
greater asset protections than the Code.
Florida is an opt-out state, meaning that when a Florida resident files for bankruptcy or is otherwise
subject to a creditor’s judgment, Florida law, rather than the federal Code, provides the exemptions
available to the debtor.18 Florida law provides a number of exemptions for various retirement-related
assets, such as IRAs and other pension, profit-sharing, and retirement benefits.19 Florida also exempts
all inherited IRA accounts from creditors’ claims, while the Code does not.20
Transfers Incident to Divorce
Florida provides protection against creditor claims for IRA accounts that are exempt from taxation
under s. 408 of the Internal Revenue Code (IRC),21 and the IRC tax exemption for an IRA account
awarded incident to a divorce provides tax-exempt status for a former spouse’s interest in such an
account at the time the transfer is made, and thereafter.22
Although there is no current controversy in Florida regarding the protection afforded an IRA account
awarded incident to a divorce, recent bankruptcy court decisions from other jurisdictions may indicate
the need to clarify such protection under Florida law. In a 2018 opinion, the U.S. Bankruptcy Appellate
Court for the Eighth Circuit held that a debtor’s funds must satisfy two requirements to be considered
exempt retirement funds under the Code:
The amount must be retirement funds; and
The retirement funds must be in an account that is exempt from taxation under one of the
provisions of the IRC.23
The Court found that the funds in an IRA account awarded to a transferee spouse incident to his
divorce years before he filed for chapter 7 bankruptcy, but which he never transferred from his former
wife’s IRA account or designated himself as the owner of, were not retirement funds for purposes of a
bankruptcy exemption.24 As such, these funds were subject to creditors’ claims.
Effect of Proposed Changes
HB 649 clarifies that any interest in an IRA awarded or received in a transfer incident to divorce is
exempt from creditors upon being awarded or received and remains exempt from creditors’ claims after
the transfer is complete.
The bill provides that it is effective upon becoming a law and applies retroactively to all transfers made
incident to divorce.
B. SECTION DIRECTORY:
Section 1: Amends s. 222.21, F.S., relating to exemption of pension money and certain tax-exempt
funds or accounts from legal processes.
Section 2: Provides that the bill is effective upon becoming a law.
16 11.U.S.C. s. 522.
17 11.U.S.C. ss. 522(b)(3)(A) & (d).
18 S. 222.20, F.S.
19 S. 222.21(2), F.S.
20 S. 222.21(2)(c), F.S.
21 S. 222.21(2), F.S.
22 28 U.S.C. s. 408(d)(6).
23 In re Lerb akken, 590 B.R. 895 (2018); see Clark v. Rameker, 573 U.S. 122 (2014).
24 Lerb akken, 590 B.R. at 897, 898.
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II. FISCAL ANALYSIS & ECONOMIC IMPACT STATEMENT
A. FISCAL IMPACT ON STATE GOVERNMENT:
1. Revenues:
None.
2. Expenditures:
None.
B. FISCAL IMPACT ON LOCAL GOVERNMENTS:
1. Revenues:
None.
2. Expenditures:
None.
C. DIRECT ECONOMIC IMPACT ON PRIVATE SECTOR:
Indeterminate. The bill may make it more difficult for creditors to access certain interests in IRAs
transferred pursuant to dissolution of marriage actions.
D. FISCAL COMMENTS:
None.
III. COMMENTS
A. CONSTITUTIONAL ISSUES:
1. Applicability of Municipality/County Mandates Provision:
Not applicable. The bill does not appear to affect county or municipal governments.
2. Other:
None.
B. RULE-MAKING AUTHORITY:
Not applicable.
C. DRAFTING ISSUES OR OTHER COMMENTS:
None.
IV. AMENDMENTS/COMMITTEE SUBSTITUTE CHANGES
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
HB 649 2022
1 A bill to be entitled
2 An act relating to transfers in divorce; amending s.
3 222.21, F.S.; specifying that certain interests
4 received by a transferee after a divorce are exempt
5 from claims of creditors upon being awarded to or
6 received by the transferee; specifying that such
7 interests remain exempt; providing retroactive
8 applicability; providing an effective date.
9
10 Be It Enacted by the Legislature of the State of Florida:
11
12 Section 1. Paragraph (c) of subsection (2) of section
13 222.21, Florida Statutes, is amended to read:
14 222.21 Exemption of pension money and certain tax -exempt
15 funds or accounts from legal processes.—
16 (2)
17 (c) Any money or other assets or any interest in any fund
18 or account that is exempt from claims of creditors of the owner,
19 beneficiary, or participant under paragraph (a) does not cease
20 to be exempt after the owner's death by reason of a direct
21 transfer or eligible rollover that is excluded from gross income
22 under the Internal Revenue Code of 1986, including, but not
23 limited to, a direct transfer or eligible rollover to an
24 inherited individual retirement account as defined in s.
25 408(d)(3) of the Internal Revenue Code of 1986, as amended. An
Page 1 of 2
CODING: Words stricken are deletions; words underlined are additions.
hb0649-00
F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
HB 649 2022
26 interest in any fund or account awarded or received in a
27 transfer incident to divorce described in s. 408(d)(6) of the
28 Internal Revenue Code of 1986, as amended, is exempt upon the
29 interest being awarded or received and continues to be exempt
30 thereafter. This paragraph is intended to clarify existing law,
31 is remedial in nature, and shall have retroactive application to
32 all inherited individual retirement accounts and to each
33 transfer incident to divorce without regard to the date an
34 account was created or the transfer was made.
35 Section 2. This act shall take effect upon becoming a law.
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CODING: Words stricken are deletions; words underlined are additions.
hb0649-00
HB 1559
HOUSE OF REPRESENTATIVES STAFF ANALYSIS
BILL #: HB 1559 Public Deposits
SPONSOR(S): Harding and others
TIED BILLS: IDEN./SIM. BILLS: SB 1318
REFERENCE ACTION ANALYST STAFF DIRECTOR or
BUDGET/POLICY CHIEF
1) Insurance & Banking Subcommittee Hinshelwood Luczynski
2) State Administration & Technology Appropriations
Subcommittee
3) Commerce Committee
SUMMARY ANALYSIS
State and local governments are required, unless exempted by law, to deposit public funds in a qualified public
depository (QPD) pursuant to the Florida Security for Public Deposits Act (Act), which is administered by the
Chief Financial Officer (CFO) and the Department of Financial Services (DFS). Before a QPD accepts or
retains a public deposit, it must deposit collateral with an approved custodian in an amount commensurate with
the amount of public deposits held and commensurate with the financial stability of the QPD. Currently, banks,
savings banks, and savings associations are the only types of financial institutions eligible to be a QPD or a
custodian for another QPD’s pledged collateral.
The bill makes the following amendments to the Act:
Makes state-chartered and federally-chartered credit unions eligible to become QPDs and custodians
for another QPD’s pledged collateral;
Provides criteria that a credit union must meet before the CFO can designate a credit union as a QPD;
Creates separate mutual responsibility and contingent liability provisions for credit unions, in order to
prevent banks from sharing liability with credit unions in the event of a credit union QPD’s default or
insolvency, and vice versa; and
Requires the CFO to segregate and separately account for any collateral proceeds, assessments, or
administrative penalties attributable to a credit union from those attributable to any bank, savings bank,
or savings association.
Although there is potential for the bill to have a positive impact on revenues of state government, the bill will
require recurring and non-recurring expenditures. See Fiscal Impact on State Government section. The bill
does not include an appropriation to fund DFS’s implementation and ongoing maintenance of credit unions as
QPDs. The bill has an indeterminate fiscal impact on local governments and the private sector.
The bill provides an effective date of July 1, 2022.
This docum ent does not reflect the intent or official position of the bill sponsor or House of Representatives .
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FULL ANALYSIS
I. SUBSTANTIVE ANALYSIS
A. EFFECT OF PROPOSED CHANGES:
Background
Public Depositories
State and local governments are required, unless exempted by law, to deposit public funds in a
qualified public depository (QPD)1 pursuant to the Florida Security for Public Deposits Act (Act).2 A
QPD is any bank, savings bank, or savings association that:
Is organized and exists under the laws of the United States, the laws of this state or any other
state or territory of the United States (i.e., state or federally chartered);
Has its principal place of business in this state or has a branch office in this state which is
authorized under the laws of this state or of the United States to receive deposits in this state;
Has deposit insurance under the provision of the Federal Deposit Insurance Act, as amended,
12 U.S.C. ss. 1811 et seq.;
Has procedures and practices for accurate identification, classification, reporting, and
collateralization of public deposits;
Meets all the requirements of the Act; and
Has been designated by the Chief Financial Officer (CFO) as a QPD.3
Upon approval by the CFO, these banks, savings banks, and savings associations may accept “public
deposits”4 from state and local governments. The Act does not permit credit unions to become QPDs,
due to their absence from the definition of “qualified public depository.” As of January 25, 2022, there
are 119 active QPDs in this state.5
Before a QPD accepts or retains a public deposit, it must deposit collateral with an approved custodian
in an amount commensurate with the amount of public deposits held and commensurate with the
financial stability of the QPD.6 The Act’s collateral requirements protect public deposits against loss in
the event of certain triggering events, most notably, a QPD’s insolvency or default. 7 Losses are
satisfied first through the standard maximum federal deposit insurance of $250,000, 8 and then through
the CFO’s demand for payment under letters of credit or the sale of collateral pledged or deposited by
the defaulting QPD. Any shortfall would then be covered by the CFO’s authority to impose assessments
against the other solvent QPDs, who must agree to share mutual responsibility and contingent liability
as a condition of acting as a QPD.9
A “custodian” can be any state or federally chartered bank, savings association, and trust company that
is approved by the CFO to hold the collateral that QPDs have pledged to secure public deposits. 10
These are referred to as “regular” custodians. Subject to specified requirements, QPDs also have the
option to pledge their collateral with custodians who are bound under a custody contract directly with
1 S. 280.03(1)(b), F.S.
2 Ch. 280, F.S.
3 S. 280.02(26), F.S.
4 Public deposits include, but are not limited to, time deposit accounts, demand deposit accounts, and nonnegotiable
certificates of deposits, but do not include moneys in deposit notes, securities, mutual funds, and sim ilar investments. S.
280.02(23), F.S.
5 A list of active QPDs is available at: https://myfloridacfo.com/docs-sf/treasury-libraries/treasury-
documents/listofactiveqpds.pdf (last visited Feb. 11, 2022).
6 S. 280.04, F.S. See also ch. 69C-2, F.A.C.
7 S. 280.041(6), F.S.
8 12 U.S.C. § 1821(a)(1)(E).
9 S. 280.07, F.S.
10 Ss. 280.02(10) and 280.041(1)(a), F.S.
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the CFO (“CFO’s custodians”);11 pursuant to an agreement with a Federal Reserve Bank;12 or may use
a Federal Home Loan Bank letter of credit that names the CFO as beneficiary.13
DFS oversees the Act’s reporting and collateral pledging requirements through its public deposits
program and Bureau of Collateral Management.14 The CFO has authority to take action against
noncompliant QPDs, as well as financial institutions that accept public deposits without a certificate of
qualification from the CFO. In the event of loss to public depositors, the CFO has authority to oversee
the payment of losses.
Regulation of Credit Unions
Like banks, savings banks, and savings associations, credit unions accept deposits and make loans,
and can be state-chartered or federally-chartered:
State-chartered credit unions may be formed under the Florida Credit Union Act (FCUA), which
became law in 1980.15 The FCUA provides that “[a] credit union is a cooperative, nonprofit
association, organized . . . for the purposes of encouraging thrift among its members, creating
sources of credit at fair and reasonable rates of interest, and providing an opportunity for its
members to use and control their resources on a democratic basis in order to improve their
economic and social condition.”16 State-chartered credit unions have both a state regulator, the
Office of Financial Regulation, and a federal regulator, the National Credit Union Association
(NCUA).
Federally-chartered credit unions are chartered under the Federal Credit Union Act of 193417
and are regulated by the NCUA.
In addition to regulating both state-chartered and federally-chartered credit unions, the NCUA also
operates and manages the National Credit Union Share Insurance Fund (NCUSIF), which insures
share (deposit) accounts for members of all federally-chartered credit unions and most state-chartered
credit unions.18 All state-chartered credit unions operating in Florida must carry NCUSIF insurance. 19
The standard maximum share insurance amount is $250,000.20
Effect of Proposed Changes
The bill makes state-chartered and federally-chartered credit unions eligible to become QPDs and
custodian for another QPD’s pledged collateral.
The bill creates s. 280.042, F.S., to provide criteria that a credit union must meet before the CFO can
designate a credit union as a QPD. These provisions are designed to protect public deposits. The credit
union is required to submit its agreement of contingent liability and its collateral agreement to the CFO
and meet the following requirements:
The credit union must submit a signed statement from a public depositor (i.e., a state or local
government) indicating that, if the credit union is designated as a QPD, the public depositor
intends to deposit public funds with the credit union; and
There are at least four other credit unions that are designated as QPDs or have applied to be
designated as QPDs and have submitted an agreement of contingent liability, a collateral
11 S. 280.041(1)(c) and (4), F.S.
12 S. 280.041(1)(b) and (3), F.S.
13 S. 280.041(1)(d) and (5), F.S.
14 Id.
15 Ch. 80-258, Laws of Fla.; codified at ch. 657, F.S.
16 S. 657.003, F.S.
17 Public Law 73-467, codified at 12 U.S.C. § 1751 et seq.
18 Federally-chartered credit unions must be insured through NCUSIF, and state-chartered credit unions may be insured
through NCUSIF, though some state-chartered credit unions may be insured by private insurance or guaranty
corporations. See NCUA, How Your Accounts Are Federally Insured, available at
https://www.ncua.gov/files/publications/guides-manuals/NCUAHowY ourAcctInsured.pdf (last visited Feb. 11, 2022).
19 Ss. 657.005(7), 657.008(5)(a)2., and 657.033(9), F.S.
20 NCUA, supra note 18.
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agreement, and a signed statement from a public depositor of intent to deposit public funds with
the credit union.
The CFO must withdraw from a collateral agreement previously entered into with a credit union if,
during any 90 calendar days, the combined total of the number of credit unions designated as QPDs
and the number of eligible credit unions applying to be designated as QPDs is less than five. As a result
of the CFO’s withdrawal, the credit union loses its designation as a QPD, and must within 10 days after
the CFO’s notification of such withdrawal, return all public deposits that the credit union holds to the
public depositor who deposited the funds. Additionally, the CFO may limit the amount of public deposits
any one credit union may hold in order to make sure that no single credit union holds an amount of
public deposits that might adversely affect the integrity of the public deposits program.
In order to prevent credit unions from sharing contingent liability with banks, and vice versa, the bill
creates separate mutual responsibility and contingent liability provisions for credit unions. Any credit
union that is designated as a QPD and that is not insolvent must guarantee public depositors against
loss caused by the default or insolvency of other credit unions that are designated as QPDs. In the
event of a default or insolvency of a credit union QPD, any loss to public depositors would be satisfied
through any applicable share insurance and then through demanding payment under letters of credit or
the sale of collateral pledged or deposited by the defaulting depository. The CFO may assess QPDs,
subject to the segregation of contingent liability provided in s. 280.07, F.S., for the total loss if the
demand for payment or sale of collateral cannot be accomplished within 7 business days.
The bill requires the CFO to segregate and separately account for any collateral proceeds,
assessments, or administrative penalties attributable to a credit union from those attributable to any
bank, savings bank, or savings association. Subject to this segregation of funds requirement, the CFO
is authorized to pay any losses to public depositors from the Public Deposits Trust Fund.
Lastly, the bill makes conforming changes to allow credit unions to participate in the public deposit
program and to subject credit union QPDs to the regulatory oversight of the CFO.
B. SECTION DIRECTORY:
Section 1. Amends s. 17.68, F.S., relating to Financial Literacy Program for Individuals with
Developmental Disabilities.
Section 2. Amends s. 280.02, F.S., relating to definitions.
Section 3. Amends s. 280.03, F.S., relating to public deposits to be secured; prohibitions;
exemptions.
Section 4. Creates s. 280.042, F.S., relating to credit union designations as qualified public
depositories; withdrawal by the Chief Financial Officer from collateral agreements;
limits on public deposits.
Section 5. Amends s. 280.05, F.S., relating to powers and duties of the Chief Financial Officer.
Section 6. Amends s. 280.052, F.S., relating to order of suspension or disqualification;
procedure.
Section 7. Amends s. 280.053, F.S., relating to period of suspension or disqualification;
obligations during period; reinstatement.
Section 8. Amends s. 280.055, F.S., relating to cease and desist order; corrective order;
administrative penalty.
Section 9. Amends s. 280.07, F.S., relating to mutual responsibility and contingent liability.
Section 10. Amends s. 280.08, F.S., relating to procedure for payment of losses.
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Section 11. Amends s. 280.085, F.S., relating to notice to claimants.
Section 12. Amends s. 280.09, F.S., relating to Public Deposits Trust Fund.
Section 13. Amends s. 280.10, F.S., relating to effect of merger, acquisition, or consolidation;
change of name or address.
Section 14. Amends s. 280.13, F.S., relating to eligible collateral.
Section 15. Amends s. 280.17, F.S., relating to requirements for public depositors; notice to public
depositors and governmental units; loss of protection.
Sections 16-33. Reenacts various sections of statutes to incorporate amendments to ch. 280, F.S.
Section 34. Provides an effective date of July 1, 2022.
II. FISCAL ANALYSIS & ECONOMIC IMPACT STATEMENT
A. FISCAL IMPACT ON STATE GOVERNMENT:
1. Revenues:
The bill’s impact on state government revenues is indeterminate. However, the potential positive
impact to revenues of state government is the same as the potential positive impact to revenues of
local governments. See Fiscal Impact on Local Governments section below.
2. Expenditures:
According to DFS, allowing credit unions to be QPDs will require: 21
$188,650 in non-recurring expenditures for DFS’s Office of Information Technology (OIT) to
make:
o Significant programming changes to the Collateral Administration Program (CAP), a
computer application used to administer Florida’s public deposits program.
o Modifications to the Florida Planning Accounting, and Ledger Management (PALM)
system to accommodate the required segregated accounting of collateral proceeds,
assessments, or administrative penalties attributable to credit unions.
$5,728 in recurring expenditures for independent ranking service data on credit unions.
$75,450 in recurring expenditures for one additional Financial Examiner/Analyst II FTE,
class code 1564, pay grade 023.
The cost estimate for OIT changes described above may differ, as the cost of such changes has not
been evaluated as of the current year.22 The addition of credit unions as QPDs may also require
additional ongoing OIT support, especially at the outset. 23
The bill does not include an appropriation to fund DFS’s implementation and ongoing maintenance
of credit unions as QPDs.
B. FISCAL IMPACT ON LOCAL GOVERNMENTS:
1. Revenues:
21 Department of Financial Services, Agency Analysis of 2022 House Bill 1559 (Jan. 27, 2022).
22 Id.
23 Id.
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The bill’s impact on local government revenues is indeterminate. However, a 2014 study by the
Office of Program Policy Analysis and Government Accountability explained the potential positive
impact to local government public depositors:
Federal and state tax differences between credit unions and banks may allow credit
unions a competitive advantage when bidding for local government public deposits.
Credit unions may also benefit from lower overhead costs since these institutions may
use office space belonging to a sponsoring organization. The combined effect of
lower taxes and overhead may allow credit unions to pay higher interest rates for
public deposits and to provide other business services to local governments at a
lower cost than banks.24
2. Expenditures:
None.
C. DIRECT ECONOMIC IMPACT ON PRIVATE SECTOR:
Allowing credit unions to accept public deposits may generate additional income for the credit unions
and provide more options for the public depositors. It is unclear what impact the bill will have on
existing QPDs (banks, savings banks, or savings associations). The bill’s impact on the private sector
is indeterminate due to the number of variables involved in determining such impact.
D. FISCAL COMMENTS:
None.
III. COMMENTS
A. CONSTITUTIONAL ISSUES:
1. Applicability of Municipality/County Mandates Provision:
Not Applicable. This bill does not appear to require counties or municipalities to spend funds or take
action requiring the expenditures of funds; reduce the authority that counties or municipalities have
to raise revenues in the aggregate; or reduce the percentage of state tax shared with counties or
municipalities.
2. Other:
None.
B. RULE-MAKING AUTHORITY:
The CFO has rulemaking authority to administer ch. 280, F.S. 25 In order to add credit unions as QPDs,
rulemaking is necessary to amend ch. 69C-2, F.A.C., and several forms incorporated by reference in
the rules.
C. DRAFTING ISSUES OR OTHER COMMENTS:
DFS recommends that the effective date be changed to July 1, 2023.26
IV. AMENDMENTS/ COMMITTEE SUBSTITUTE CHANGES
24 Office of Program Policy Analysis and Government Accountability, Issues Related to Credit Unions Operating as
Qualified Public Depositories, Nov. 13, 2014, at 5.
25 S. 280.19, F.S.
26 Department of Financial Services, supra note 21.
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1 A bill to be entitled
2 An act relating to public deposits; amending s. 17.68,
3 F.S.; providing requirements for credit unions that
4 are qualified public depositories; requiring the
5 Department of Financial Services to provide its
6 brochures to such credit unions upon request; amending
7 s. 280.02, F.S.; revising definitions; amending s.
8 280.03, F.S.; providing that public deposits in credit
9 unions by specified trust departments or trust
10 companies are exempt from certain requirements and
11 protection; creating s. 280.042, F.S.; prohibiting the
12 Chief Financial Officer from designating credit unions
13 as qualified public depositories unless certain
14 requirements are met; requiring the Chief Financial
15 Officer to withdraw from specified collateral
16 agreements under certain circumstances; prohibiting
17 credit unions from being designated as qualified
18 public depositories if the Chief Financial Officer
19 withdraws from collateral agreements; requiring
20 specified credit unions to return all public deposits
21 in the credit unions within a specified timeframe
22 under certain circumstances; authorizing the Chief
23 Financial Officer to limit the amount of public
24 deposits in credit unions for a specified purpose;
25 amending s. 280.05, F.S.; revising the losses for
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26 which the Chief Financial Officer may sell securities
27 to protect the integrity of the public deposits
28 program; amending s. 280.052, F.S.; providing
29 requirements for the suspension or disqualification of
30 credit unions as qualified public depositories;
31 amending s. 280.053, F.S.; authorizing credit unions
32 to be reinstated, or to reapply for qualification, as
33 qualified public depositories under specified
34 circumstances; amending s. 280.055, F.S.; authorizing
35 the Chief Financial Officer to issue a cease and
36 desist order and a corrective order to credit unions
37 upon certain determinations; providing penalties;
38 amending s. 280.07, F.S.; specifying the losses
39 against which certain solvent banks, savings banks,
40 savings associations, and credit unions must guarantee
41 public depositors; amending s. 280.08, F.S.; revising
42 the Chief Financial Officer's procedures upon a
43 default or insolvency of a qualified public
44 depository; amending s. 280.085, F.S.; revising the
45 exemptions to the notice to claimants upon a default
46 or insolvency of a qualified public depository;
47 amending s. 280.09, F.S.; requiring the Chief
48 Financial Officer to segregate and separately account
49 for certain proceeds, assessments, and administrative
50 penalties; revising the payment of any losses to
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51 public depositors; amending s. 280.10, F.S.; revising
52 the duties and responsibilities of qualified public
53 depositories as a result of specified mergers,
54 acquisitions, or consolidations; amending s. 280.13,
55 F.S.; providing that the limits imposed on specified
56 securities apply to qualified public depositories,
57 rather than to banks and savings associations;
58 amending s. 280.17, F.S.; revising the evidence that
59 public depositors must submit when a qualified public
60 depository is in default or insolvent; reenacting ss.
61 17.57(7)(a), 24.114(1), 125.901(3)(e), 136.01,
62 159.608(11), 175.301, 175.401(8), 185.30, 185.50(8),
63 190.007(3), 191.006(16), 215.34(2), 218.415(16)(c),
64 (17)(c), and (23)(a), 255.502(4)(h), 331.309(1) and
65 (2), 373.553(2), 631.221, and 723.06115(3)(c), F.S.,
66 relating to deposits and investments of state money;
67 bank deposits and control of lottery transactions;
68 children's services and independent special districts;
69 county depositories; powers of housing finance
70 authorities; depositories for pension funds; retiree
71 health insurance subsidies; depositories for
72 retirement funds; retiree health insurance subsidies;
73 board of supervisors; general powers; state funds and
74 noncollectible items; local government investment
75 policies; definitions; treasurer, depositories, and
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76 fiscal agent; treasurer of the board, payment of
77 funds, and depositories; deposit of moneys collected;
78 and the Florida Mobile Home Relocation Trust Fund,
79 respectively, to incorporate the amendments made by
80 the act; providing an effective date.
81
82 Be It Enacted by the Legislature of the State of Florida:
83
84 Section 1. Subsection (4) of section 17.68, Florida
85 Statutes, is amended to read:
86 17.68 Financial Literacy Program for Individuals with
87 Developmental Disabilities.—
88 (4) Within 90 days after the department establishes the
89 website clearinghouse and publishes the brochure, each bank,
90 credit union, savings association, and savings bank that is a
91 qualified public depository as defined in s. 280.02 shall:
92 (a) Make copies of the department's brochures available,
93 upon the request of the consumer, at its principal place of
94 business and each branch office located in this state which has
95 in-person teller services by having copies of the brochure
96 available or having the capability to print a copy of the
97 brochure from the department's website. Upon request, the
98 department shall provide copies of the brochure to a bank,
99 credit union, savings association, or savings bank.
100 (b) Provide on its website a hyperlink to the department's
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101 website clearinghouse. If the department changes the website
102 address for the clearinghouse, the bank, credit union, savings
103 association, or savings bank must update the hyperlink within 90
104 days after notification by the department of such change.
105 Section 2. Subsections (6), (10), (21), (23), and (26) of
106 section 280.02, Florida Statutes, are amended to read:
107 280.02 Definitions.—As used in this chapter, the term:
108 (6) "Capital account" or "tangible equity capital" means
109 total equity capital, as defined on the balance-sheet portion of
110 the Consolidated Reports of Condition and Income (call report),
111 or net worth, as described in the National Credit Union
112 Administration 5300 Call Report, less intangible assets, as
113 submitted to the regulatory financial banking authority.
114 (10) "Custodian" means the Chief Financial Officer or a
115 bank, credit union, savings association, or trust company that:
116 (a) Is organized and existing under the laws of this
117 state, any other state, or the United States;
118 (b) Has executed all forms required under this chapter or
119 any rule adopted hereunder;
120 (c) Agrees to be subject to the jurisdiction of the courts
121 of this state, or of the courts of the United States which are
122 located within this state, for the purpose of any litigation
123 arising out of this chapter; and
124 (d) Has been approved by the Chief Financial Officer to
125 act as a custodian.
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126 (21) "Pool figure" means the total average monthly
127 balances of public deposits held by all banks, savings banks, or
128 savings associations or held separately by all credit unions
129 qualified public depositories during the immediately preceding
130 12-month period.
131 (23) "Public deposit" means the moneys of the state or of
132 any state university, county, school district, community college
133 district, special district, metropolitan government, or
134 municipality, including agencies, boards, bureaus, comm issions,
135 and institutions of any of the foregoing, or of any court, and
136 includes the moneys of all county officers, including
137 constitutional officers, which are placed on deposit in a bank,
138 credit union, savings bank, or savings association. This
139 includes, but is not limited to, time deposit accounts, demand
140 deposit accounts, and nonnegotiable certificates of deposit.
141 Moneys in deposit notes and in other nondeposit accounts such as
142 repurchase or reverse repurchase operations are not public
143 deposits. Securities, mutual funds, and similar types of
144 investments are not public deposits and are not subject to this
145 chapter.
146 (26) "Qualified public depository" means a bank, credit
147 union, savings bank, or savings association that:
148 (a) Is organized and exists under the laws of the United
149 States, or the laws of this state, or the laws of any other
150 state or territory of the United States.
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151 (b) Has its principal place of business in this state or
152 has a branch office in this state which is authorized under the
153 laws of this state or of the United States to receive deposits
154 in this state.
155 (c) Is insured by the Federal Deposit Insurance
156 Corporation or the National Credit Union Share Insurance Fund
157 Has deposit insurance pursuant to the Federal Deposit Insurance
158 Act, as amended, 12 U.S.C. ss. 1811 et seq.
159 (d) Has procedures and practices for accurate
160 identification, classification, reporting, and collateralization
161 of public deposits.
162 (e) Meets all the requirements of this chapter.
163 (f) Has been designated by the Chief Financial Officer as
164 a qualified public depository.
165 Section 3. Paragraph (a) of subsection (3) of section
166 280.03, Florida Statutes, is amended to read:
167 280.03 Public deposits to be secured; prohibitions;
168 exemptions.—
169 (3) The following are exempt from the requirements of, and
170 protection under, this chapter:
171 (a) Public deposits deposited in a bank, credit union, or
172 savings association by a trust department or trust company which
173 are fully secured under trust business laws.
174 Section 4. Section 280.042, Florida Statutes, is created
175 to read:
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176 280.042 Credit union designations as qualified public
177 depositories; withdrawal by the Chief Financial Officer from
178 collateral agreements; limits on public deposits.—
179 (1) The Chief Financial Officer may not designate a credit
180 union as a qualified public depository unless, at the time the
181 credit union submits its agreement of contingent liability and
182 its collateral agreement:
183 (a) The credit union submits a signed statement from a
184 public depositor indicating that if the credit union is
185 designated as a qualified public depository, the public
186 depositor intends to deposit public funds with the credit union.
187 (b) The combined total of the numbers in subparagraphs 1.
188 and 2. is at least four:
189 1. The number of credit unions designated as qualified
190 public depositories.
191 2. The number of credit unions that meet all of the
192 following requirements:
193 a. Apply to be designated as qualified public
194 depositories.
195 b. Meet the requirements in paragraph (a).
196 (2) The Chief Financial Officer must withdraw from a
197 collateral agreement previously entered into with a credit union
198 if, during any 90 calendar days, the combined total of the
199 number of credit unions designated as qualified public
200 depositories and the number of eligible credit unions applying
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201 to be designated as qualified public depositories is less than
202 five.
203 (3) A credit union that is a party to a collateral
204 agreement from which the Chief Financial Officer withdraws in
205 accordance with subsection (2) may no longer be designated as a
206 qualified public depository. Within 10 business days after the
207 Chief Financial Officer notifies the credit union that the Chief
208 Financial Officer has withdrawn from the collateral agreement,
209 the credit union must return all public deposits that the credit
210 union holds to the public depositor who deposited the funds. The
211 notice provided for in this subsection may be sent to a credit
212 union by regular mail or by e-mail.
213 (4) The Chief Financial Officer may limit the amount of
214 public deposits that a credit union may hold in order to make
215 sure that no single credit union holds an amount of public
216 deposits that might adversely affect the integrity of the public
217 deposits program.
218 Section 5. Subsection (11) of section 280.05, Florida
219 Statutes, is amended to read:
220 280.05 Powers and duties of the Chief Financial Officer.—
221 In fulfilling the requirements of this act, the Chief Financial
222 Officer has the power to take the following actions he or she
223 deems necessary to protect the integrity of the publi c deposits
224 program:
225 (11) Sell securities for the purpose of paying losses to
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226 public depositors not covered by deposit or share insurance.
227 Section 6. Subsection (1) of section 280.052, Florida
228 Statutes, is amended to read:
229 280.052 Order of suspension or disqualification;
230 procedure.—
231 (1) The suspension or disqualification of a bank, credit
232 union, or savings association as a qualified public depository
233 must be by order of the Chief Financial Officer and must be
234 mailed to the qualified public depository by registered or
235 certified mail.
236 Section 7. Paragraph (c) of subsection (1) and paragraph
237 (c) of subsection (2) of section 280.053, Florida Statutes, are
238 amended to read:
239 280.053 Period of suspension or disqualification;
240 obligations during period; reinstatement.—
241 (1)
242 (c) Upon expiration of the suspension period, the bank ,
243 credit union, or savings association may, by order of the Chief
244 Financial Officer, be reinstated as a qualified public
245 depository, unless the cause of the suspension has not been
246 corrected or the bank, credit union, or savings association is
247 otherwise not in compliance with this chapter or any rule
248 adopted pursuant to this chapter.
249 (2)
250 (c) Upon expiration of the disqualification period, the
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251 bank, credit union, or savings association may reapply for
252 qualification as a qualified public depository. If a
253 disqualified bank, credit union, or savings association is
254 purchased or otherwise acquired by new owners, it may reapply to
255 the Chief Financial Officer to be a qualified public depository
256 before prior to the expiration date of the disqualification
257 period. Redesignation as a qualified public depository may occur
258 only after the Chief Financial Officer has determined that all
259 requirements for holding public deposits under the law have been
260 met.
261 Section 8. Section 280.055, Florida Statutes, is amended
262 to read:
263 280.055 Cease and desist order; corrective order;
264 administrative penalty.—
265 (1) The Chief Financial Officer may issue a cease and
266 desist order and a corrective order upon determining that:
267 (a) A qualified public depository has requested and
268 obtained a release of pledged collateral without approval of the
269 Chief Financial Officer;
270 (b) A bank, credit union, savings association, or other
271 financial institution is holding public deposits without a
272 certificate of qualification issued by the Chief Financial
273 Officer;
274 (c) A qualified public depository pledges, deposits, or
275 arranges for the issuance of unacceptable collateral;
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276 (d) A custodian has released pledged collateral without
277 approval of the Chief Financial Officer;
278 (e) A qualified public depository or a custodian has not
279 furnished to the Chief Financial Officer, when the Chief
280 Financial Officer requested, a power of attorney or bond power
281 or bond assignment form required by the bond agent or bond
282 trustee for each issue of registered certificated securities
283 pledged and registered in the name, or nominee name, of the
284 qualified public depository or custodian; or
285 (f) A qualified public depository; a bank, credit union,
286 savings association, or other financial institution; or a
287 custodian has committed any other violation of this chapter or
288 any rule adopted pursuant to this chapter that the Chief
289 Financial Officer determines may be remedied by a cease and
290 desist order or corrective order.
291 (2) Any qualified public depository or other bank, credit
292 union, savings association, or financial institution or
293 custodian that violates a cease and desist order or corrective
294 order of the Chief Financial Officer is subject to an
295 administrative penalty not exceeding $1,000 for each violation
296 of the order. Each day the violation of the order continues
297 constitutes a separate violation.
298 Section 9. Section 280.07, Florida Statutes, is amended to
299 read:
300 280.07 Mutual responsibility and contingent liability.—
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301 (1) A Any bank, savings bank, or savings association that
302 is designated as a qualified public depository and that is not
303 insolvent shall guarantee public depositors against loss caused
304 by the default or insolvency of other banks, savings banks, or
305 savings associations that are designated as qualified public
306 depositories.
307 (2) A credit union that is designated as a qualified
308 public depository and that is not insolvent shall guarantee
309 public depositors against loss caused by the default or
310 insolvency of other credit unions that are designated as
311 qualified public depositories.
312
313 Each qualified public depository shall execute a form prescribed
314 by the Chief Financial Officer for such guarantee which must
315 shall be approved by the board of directors and must shall
316 become an official record of the institution.
317 Section 10. Subsections (1) and (3) of section 280.08,
318 Florida Statutes, are amended to read:
319 280.08 Procedure for payment of losses.—When the Chief
320 Financial Officer determines that a default or insolvency has
321 occurred, he or she shall provide notice as required in s.
322 280.085 and implement the following procedures:
323 (1) The Division of Treasury, in cooperation with the
324 Office of Financial Regulation of the Financial Ser vices
325 Commission or the receiver of the qualified public depository in
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326 default, shall ascertain the amount of funds of each public
327 depositor on deposit at such depository and the amount of
328 deposit or share insurance applicable to such deposits.
329 (3)(a) The loss to public depositors shall be satisfied,
330 insofar as possible, first through any applicable deposit or
331 share insurance and then through demanding payment under letters
332 of credit or the sale of collateral pledged or deposited by the
333 defaulting depository. The Chief Financial Officer may assess
334 qualified public depositories as provided in paragraph (b) ,
335 subject to the segregation of contingent liability in s. 280.07,
336 for the total loss if the demand for payment or sale of
337 collateral cannot be accomplished within 7 business days.
338 (b) The Chief Financial Officer shall provide coverage of
339 any remaining loss by assessment against the other qualified
340 public depositories. The Chief Financial Officer shall determine
341 such assessment for each qualified public depository by
342 multiplying the total amount of any remaining loss to all public
343 depositors by a percentage which represents the average monthly
344 balance of public deposits held by each qualified public
345 depository during the previous 12 months divided by the total
346 average monthly balances of public deposits held by all
347 qualified public depositories, excluding the defaulting
348 depository, during the same period. The assessment calculation
349 must shall be computed to six decimal places.
350 Section 11. Subsection (4) of section 280.085, Florida
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351 Statutes, is amended, and subsection (1) of that section is
352 republished, to read:
353 280.085 Notice to claimants.—
354 (1) Upon determining the default or insolvency of a
355 qualified public depository, the Chief Financial Officer shall
356 notify, by first-class mail, all public depositors that have
357 complied with s. 280.17 of such default or insolvency. The
358 notice must direct all public depositors having claims or
359 demands against the Public Deposits Trust Fund occasioned by the
360 default or insolvency to file their claims with the Chief
361 Financial Officer within 30 days after the date of the notice.
362 (4) The notice required in subsection (1) is not required
363 if the default or insolvency of a qualified public depository is
364 resolved in a manner in which all Florida public deposits are
365 acquired by another insured bank, credit union, savings bank, or
366 savings association.
367 Section 12. Section 280.09, Florida Statutes, is amended
368 to read:
369 280.09 Public Deposits Trust Fund.—
370 (1) In order to facilitate the administration of this
371 chapter, there is created the Public Deposits Trust Fund,
372 hereafter in this section designated "the fund." The proceeds
373 from the sale of securities or draw on letters of credit held as
374 collateral or from any assessment pursuant to s. 280.08 must
375 shall be deposited into the fund. The Chief Financial Officer
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376 must segregate and separately account for any collateral
377 proceeds, assessments, or administrative penalties attributable
378 to a credit union from any collateral proceeds, assessments, or
379 administrative penalties attributable to any bank, savings bank,
380 or savings association. Any administrative penalty collected
381 pursuant to this chapter shall be deposited into the Treasury
382 Administrative and Investment Trust Fund.
383 (2) The Chief Financial Officer is authorized to pay any
384 losses to public depositors from the fund, subject to the
385 limitations provided in subsection (1), and there are hereby
386 appropriated from the fund such sums as may be necessary from
387 time to time to pay the losses. The term "losses," for purposes
388 of this chapter, must shall also include losses of interest or
389 other accumulations to the public depositor as a result of
390 penalties for early withdrawal required by Depository
391 Institution Deregulatory Commission Regulations or applicable
392 successor federal laws or regulations because of suspension or
393 disqualification of a qualified public depository by the Chief
394 Financial Officer pursuant to s. 280.05 or because of withdrawal
395 from the public deposits program pursuant to s. 280.11. In that
396 event, the Chief Financial Officer is authorized to assess
397 against the suspended, disqualified, or withdrawing public
398 depository, in addition to any amount authorized by any other
399 provision of this chapter, an administrative penalty equal to
400 the amount of the early withdrawal penalty and to pay that
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401 amount over to the public depositor as reimbursement for such
402 loss. Any money in the fund estimated not to be needed for
403 immediate cash requirements shall be invested pursuant to s.
404 17.61.
405 Section 13. Subsections (1) and (3) of section 280.10,
406 Florida Statutes, are amended to read:
407 280.10 Effect of merger, acquisition, or consolidation;
408 change of name or address.—
409 (1) When a qualified public depository is merged into,
410 acquired by, or consolidated with a bank, credit union, savings
411 bank, or savings association that is not a qualified public
412 depository:
413 (a) The resulting institution shall automatically become a
414 qualified public depository subject to the requirements of the
415 public deposits program.
416 (b) The contingent liability of the former institution
417 shall be a liability of the resulting institution.
418 (c) The public deposits and associated collateral of the
419 former institution shall be public deposits and collateral of
420 the resulting institution.
421 (d) The resulting institution shall, within 90 calendar
422 days after the effective date of the merger, acquisition, or
423 consolidation, deliver to the Chief Financial Officer:
424 1. Documentation in its name as required for participation
425 in the public deposits program; or
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426 2. Written notice of intent to withdraw from the program
427 as provided in s. 280.11 and a proposed effective date of
428 withdrawal which shall be within 180 days after the effective
429 date of the acquisition, merger, or consolidation of the former
430 institution.
431 (e) If the resulting institution does not meet
432 qualifications to become a qualified public depository or does
433 not submit required documentation within 90 calendar days after
434 the effective date of the merger, acquisition, or consolidation,
435 the Chief Financial Officer shall initiate mandatory withdrawal
436 actions as provided in s. 280.11 and shall set an effective date
437 of withdrawal that is within 180 days after the effective date
438 of the acquisition, merger, or consolidation of the former
439 institution.
440 (3) If the default or insolvency of a qualified public
441 depository results in acquisition of all or part of its Florida
442 public deposits by a bank, credit union, savings bank, or
443 savings association that is not a qualified public depository,
444 the bank, credit union, savings bank, or savings association
445 acquiring the Florida public deposits is subject to subsection
446 (1).
447 Section 14. Subsection (1) of section 280.13, Florida
448 Statutes, is amended to read:
449 280.13 Eligible collateral.—
450 (1) Securities eligible to be pledged as collateral by
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451 qualified public depositories banks and savings associations
452 shall be limited to:
453 (a) Direct obligations of the United States Government.
454 (b) Obligations of any federal agency that are fully
455 guaranteed as to payment of principal and interest by the United
456 States Government.
457 (c) Obligations of the following federal agencies:
458 1. Farm credit banks.
459 2. Federal land banks.
460 3. The Federal Home Loan Bank and its district banks.
461 4. Federal intermediate credit banks.
462 5. The Federal Home Loan Mortgage Corporation.
463 6. The Federal National Mortgage Association.
464 7. Obligations guaranteed by the Government National
465 Mortgage Association.
466 (d) General obligations of a state of the United States,
467 or of Puerto Rico, or of a political subdivision or municipality
468 thereof.
469 (e) Obligations issued by the Florida State Board of
470 Education under authority of the State Constitution or
471 applicable statutes.
472 (f) Tax anticipation certificates or warrants of counties
473 or municipalities having maturities not exceeding 1 year.
474 (g) Public housing authority obligations.
475 (h) Revenue bonds or certificates of a state of the United
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476 States or of a political subdivision or municipality thereof.
477 (i) Corporate bonds of any corporation that is not an
478 affiliate or subsidiary of the qualified public depository.
479 Section 15. Paragraph (b) of subsection (4) of section
480 280.17, Florida Statutes, is amended to read:
481 280.17 Requirements for public depositors; notice to
482 public depositors and governmental units; loss of protection.—In
483 addition to any other requirement specified in this chapter,
484 public depositors shall comply with the following:
485 (4) If public deposits are in a qualified public
486 depository that has been declared to be in default or insolvent,
487 each public depositor shall:
488 (b) Submit to the Chief Financial Officer for each public
489 deposit, within 30 days after the date of official notification
490 from the Chief Financial Officer, the following:
491 1. A claim form and agreement, as prescribed by the Chief
492 Financial Officer, executed under oath, accompanied by proof of
493 authority to execute the form on behalf of the public depositor.
494 2. A completed public deposit identification and
495 acknowledgment form, as described in subsection (2).
496 3. Evidence of the insurance afforded the deposit pursuant
497 to the Federal Deposit Insurance Act or the Federal Credit Union
498 Act, as appropriate.
499 Section 16. For the purpose of incorporating the amendment
500 made by this act to section 280.02, Florida Statutes, in a
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501 reference thereto, paragraph (a) of subsection (7) of section
502 17.57, Florida Statutes, is reenacted to read:
503 17.57 Deposits and investments of state money.—
504 (7) In addition to the deposits authorized under this
505 section and notwithstanding any other provisions of law, funds
506 that are not needed to meet the disbursement needs of the state
507 may be deposited by the Chief Financial Officer in accordance
508 with the following conditions:
509 (a) The funds are initially deposited in a qualified
510 public depository, as defined in s. 280.02, selected by the
511 Chief Financial Officer.
512 Section 17. For the purpose of incorporating the amendment
513 made by this act to section 280.02, Florida Statutes, in a
514 reference thereto, subsection (1) of section 24.114, Florida
515 Statutes, is reenacted to read:
516 24.114 Bank deposits and control of lottery transactions. —
517 (1) All moneys received by each retailer from the
518 operation of the state lottery, including, but not limited to,
519 all ticket sales, interest, gifts, and donations, l ess the
520 amount retained as compensation for the sale of the tickets and
521 the amount paid out as prizes, shall be remitted to the
522 department or deposited in a qualified public depository, as
523 defined in s. 280.02, as directed by the department. The
524 department shall have the responsibility for all administrative
525 functions related to the receipt of funds. The department may
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526 also require each retailer to file with the department reports
527 of the retailer's receipts and transactions in the sale of
528 lottery tickets in such form and containing such information as
529 the department may require. The department may require any
530 person, including a qualified public depository, to perform any
531 function, activity, or service in connection with the operation
532 of the lottery as it may deem advisable pursuant to this act and
533 rules of the department, and such functions, activities, or
534 services shall constitute lawful functions, activities, and
535 services of such person.
536 Section 18. For the purpose of incorporating the amendment
537 made by this act to section 280.02, Florida Statutes, in a
538 reference thereto, paragraph (e) of subsection (3) of section
539 125.901, Florida Statutes, is reenacted to read:
540 125.901 Children's services; independent special district;
541 council; powers, duties, and functions; public records
542 exemption.—
543 (3)
544 (e)1. All moneys received by the council on children's
545 services shall be deposited in qualified public depositories, as
546 defined in s. 280.02, with separate and distinguishable accounts
547 established specifically for the council and shall be withdrawn
548 only by checks signed by the chair of the council and
549 countersigned by either one other member of the council on
550 children's services or by a chief executive officer who shall be
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551 so authorized by the council.
552 2. Upon entering the duties of office, the chair and the
553 other member of the council or chief executive officer who signs
554 its checks shall each give a surety bond in the sum of at least
555 $1,000 for each $1 million or portion thereof of the council's
556 annual budget, which bond shall be conditioned that each shall
557 faithfully discharge the duties of his or her office. The
558 premium on such bond may be paid by the district as part of the
559 expense of the council. No other member of the council shall be
560 required to give bond or other security.
561 3. No funds of the district shall be expended except by
562 check as aforesaid, except expenditures from a petty cash
563 account which shall not at any time exceed $100. All
564 expenditures from petty cash shall be recorded on the books and
565 records of the council on children's services. No funds of the
566 council on children's services, excepting expenditures from
567 petty cash, shall be expended without prior approval of the
568 council, in addition to the budgeting thereof.
569 Section 19. For the purpose of incorporating the amendment
570 made by this act to section 280.02, Florida Statutes, in a
571 reference thereto, section 136.01, Florida Statutes, is
572 reenacted to read:
573 136.01 County depositories.—Each county depository shall
574 be a qualified public depository as defined in s. 280.02 for the
575 following funds: county funds; funds of all county officers,
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576 including constitutional officers; funds of the school board;
577 and funds of the community college district board of trustees.
578 This enumeration of funds is made not by way of limitation, but
579 of illustration; and it is the intent hereof that all funds of
580 the county, the board of county commissioners or the several
581 county officers, the school board, or the community college
582 district board of trustees be included.
583 Section 20. For the purpose of incorporating the amendment
584 made by this act to section 280.02, Florida Statutes, in a
585 reference thereto, subsection (11) of section 159.608, Florida
586 Statutes, is reenacted to read:
587 159.608 Powers of housing finance authorities.—A housing
588 finance authority shall constitute a public body corporate and
589 politic, exercising the public and essential governmental
590 functions set forth in this act, and shall exercise its power to
591 borrow only for the purpose as provided herein:
592 (11) To invest and reinvest surplus funds of the housing
593 finance authority in accordance with s. 218.415. However, in
594 addition to the investments expressly authorized in s.
595 218.415(16)(a)-(g) and (17)(a)-(d), a housing finance authority
596 may invest surplus funds in interest-bearing time deposits or
597 savings accounts that are fully insured by the Federal Deposit
598 Insurance Corporation regardless of whether the bank or
599 financial institution in which the deposit or investment is made
600 is a qualified public depository as defined in s. 280.02. This
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601 subsection is supplementary to and may not be construed as
602 limiting any powers of a housing finance authority or providing
603 or implying a limiting construction of any other statutory
604 provision.
605 Section 21. For the purpose of incorporating the amendment
606 made by this act to section 280.02, Florida Statutes, in a
607 reference thereto, section 175.301, Florida Statutes, is
608 reenacted to read:
609 175.301 Depository for pension funds.—For any
610 municipality, special fire control district, chapter plan, local
611 law municipality, local law special fire control district, or
612 local law plan under this chapter, all funds of the
613 firefighters' pension trust fund of any chapter plan or local
614 law plan under this chapter may be deposited by the b oard of
615 trustees with the treasurer of the municipality or special fire
616 control district, acting in a ministerial capacity only, who
617 shall be liable in the same manner and to the same extent as he
618 or she is liable for the safekeeping of funds for the
619 municipality or special fire control district. However, any
620 funds so deposited with the treasurer of the municipality or
621 special fire control district shall be kept in a separate fund
622 by the treasurer or clearly identified as such funds of the
623 firefighters' pension trust fund. In lieu thereof, the board of
624 trustees shall deposit the funds of the firefighters' pension
625 trust fund in a qualified public depository as defined in s.
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626 280.02, which depository with regard to such funds shall conform
627 to and be bound by all of the provisions of chapter 280.
628 Section 22. For the purpose of incorporating the amendment
629 made by this act to section 280.02, Florida Statutes, in
630 references thereto, subsection (8) of section 175.401, Florida
631 Statutes, is reenacted to read:
632 175.401 Retiree health insurance subsidy.—For any
633 municipality, special fire control district, chapter plan, local
634 law municipality, local law special fire control district, or
635 local law plan under this chapter, under the broad grant of home
636 rule powers under the Florida Constitution and chapter 166,
637 municipalities have the authority to establish and administer
638 locally funded health insurance subsidy programs. In addition,
639 special fire control districts may, by resolution, establish and
640 administer locally funded health insurance subsidy programs.
641 Pursuant thereto:
642 (8) DEPOSIT OF HEALTH INSURANCE SUBSIDY FUNDS.—All funds
643 of the health insurance subsidy fund may be deposited by the
644 board of trustees with the treasurer of the municipality or
645 special fire control district, acting in a ministerial capacity
646 only, who shall be liable in the same manner and to the same
647 extent as he or she is liable for the safekeeping of funds for
648 the municipality or special fire control district. Any funds so
649 deposited shall be segregated by the treasurer in a separate
650 fund, clearly identified as funds of the health insurance
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651 subsidy fund. In lieu thereof, the board of trustees shall
652 deposit the funds of the health insurance subsidy fund in a
653 qualified public depository as defined in s. 280.02, which shall
654 conform to and be bound by the provisions of chapter 280 with
655 regard to such funds. In no case shall the funds of the health
656 insurance subsidy fund be deposited in any financial
657 institution, brokerage house trust company, or other en tity that
658 is not a public depository as provided by s. 280.02.
659 Section 23. For the purpose of incorporating the amendment
660 made by this act to section 280.02, Florida Statutes, in a
661 reference thereto, section 185.30, Florida Statutes, is
662 reenacted to read:
663 185.30 Depository for retirement fund.—For any
664 municipality, chapter plan, local law municipality, or local law
665 plan under this chapter, all funds of the municipal police
666 officers' retirement trust fund of any municipality, chapter
667 plan, local law municipality, or local law plan under this
668 chapter may be deposited by the board of trustees with the
669 treasurer of the municipality acting in a ministerial capacity
670 only, who shall be liable in the same manner and to the same
671 extent as he or she is liable for the safekeeping of funds for
672 the municipality. However, any funds so deposited with the
673 treasurer of the municipality shall be kept in a separate fund
674 by the municipal treasurer or clearly identified as such funds
675 of the municipal police officers' retirement trust fund. In lieu
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676 thereof, the board of trustees shall deposit the funds of the
677 municipal police officers' retirement trust fund in a qualified
678 public depository as defined in s. 280.02, which depository with
679 regard to such funds shall conform to and be bound by all of the
680 provisions of chapter 280.
681 Section 24. For the purpose of incorporating the amendment
682 made by this act to section 280.02, Florida Statutes, in
683 references thereto, subsection (8) of section 185.50, Florida
684 Statutes, is reenacted to read:
685 185.50 Retiree health insurance subsidy.—For any
686 municipality, chapter plan, local law municipality, or local law
687 plan under this chapter, under the broad grant of home rule
688 powers under the Florida Constitution and chapter 166,
689 municipalities have the authority to establish and administer
690 locally funded health insurance subsidy programs. Pursuant
691 thereto:
692 (8) DEPOSIT OF PENSION FUNDS.—All funds of the health
693 insurance subsidy fund may be deposited by the board of trustees
694 with the treasurer of the municipality, acting in a ministerial
695 capacity only, who shall be liable in the same manner and to the
696 same extent as he or she is liable for the safekeeping of funds
697 for the municipality. Any funds so deposited shall be segregated
698 by said treasurer in a separate fund, clearly identified as
699 funds of the health insurance subsidy fund. In lieu thereof, the
700 board of trustees shall deposit the funds of the health
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701 insurance subsidy fund in a qualified public depository as
702 defined in s. 280.02, which shall conform to and be bound by the
703 provisions of chapter 280 with regard to such funds. In no case
704 shall the funds of the health insurance subsidy fund be
705 deposited in any financial institution, brokerage house trust
706 company, or other entity that is not a public depository as
707 provided by s. 280.02.
708 Section 25. For the purpose of incorporating the amendment
709 made by this act to section 280.02, Florida Statutes, in a
710 reference thereto, subsection (3) of section 190.007, Florida
711 Statutes, is reenacted to read:
712 190.007 Board of supervisors; general duties.—
713 (3) The board is authorized to select as a depository for
714 its funds any qualified public depository as defined in s.
715 280.02 which meets all the requirements of chapter 280 and has
716 been designated by the Chief Financial Officer as a qualified
717 public depository, upon such terms and conditions as to the
718 payment of interest by such depository upon the funds so
719 deposited as the board may deem just and reasonable.
720 Section 26. For the purpose of incorporating the amendment
721 made by this act to section 280.02, Florida Statutes, in a
722 reference thereto, subsection (16) of section 191.006, Florida
723 Statutes, is reenacted to read:
724 191.006 General powers.—The district shall have, and the
725 board may exercise by majority vote, the following powers:
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726 (16) To select as a depository for its funds any qualified
727 public depository as defined in s. 280.02 which meets all the
728 requirements of chapter 280 and has been designated by the Chief
729 Financial Officer as a qualified public depository, upon such
730 terms and conditions as to the payment of interest upon the
731 funds deposited as the board deems just and reasonable.
732 Section 27. For the purpose of incorporating the amendment
733 made by this act to section 280.02, Florida Statutes, in a
734 reference thereto, subsection (2) of section 215.34, Florida
735 Statutes, is reenacted to read:
736 215.34 State funds; noncollectible items; procedure. —
737 (2) Whenever a check, draft, or other order for the
738 payment of money is returned by the Chief Financial Officer, or
739 by a qualified public depository as defined in s. 280.02, to a
740 state officer, a state agency, or the judicial branch for
741 collection, the officer, agency, or judicial branch shall add to
742 the amount due a service fee of $15 or 5 percent of t he face
743 amount of the check, draft, or order, whichever is greater. An
744 agency or the judicial branch may adopt a rule which prescribes
745 a lesser maximum service fee, which shall be added to the amount
746 due for the dishonored check, draft, or other order tend ered for
747 a particular service, license, tax, fee, or other charge, but in
748 no event shall the fee be less than $15. The service fee shall
749 be in addition to all other penalties imposed by law, except
750 that when other charges or penalties are imposed by an age ncy
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751 related to a noncollectible item, the amount of the service fee
752 shall not exceed $150. Proceeds from this fee shall be deposited
753 in the same fund as the collected item. Nothing in this section
754 shall be construed as authorization to deposit moneys outside
755 the State Treasury unless specifically authorized by law.
756 Section 28. For the purpose of incorporating the amendment
757 made by this act to section 280.02, Florida Statutes, in
758 references thereto, paragraph (c) of subsection (16), paragraph
759 (c) of subsection (17), and paragraph (a) of subsection (23) of
760 section 218.415, Florida Statutes, are reenacted to read:
761 218.415 Local government investment policies.—Investment
762 activity by a unit of local government must be consistent with a
763 written investment plan adopted by the governing body, or in the
764 absence of the existence of a governing body, the respective
765 principal officer of the unit of local government and maintained
766 by the unit of local government or, in the alternative, such
767 activity must be conducted in accordance with subsection (17).
768 Any such unit of local government shall have an investment
769 policy for any public funds in excess of the amounts needed to
770 meet current expenses as provided in subsections (1)-(16), or
771 shall meet the alternative investment guidelines contained in
772 subsection (17). Such policies shall be structured to place the
773 highest priority on the safety of principal and liquidity of
774 funds. The optimization of investment returns shall be secondary
775 to the requirements for safety and liquidity. Each unit of local
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776 government shall adopt policies that are commensurate with the
777 nature and size of the public funds within its custody.
778 (16) AUTHORIZED INVESTMENTS; WRITTEN INVESTMENT POLICIES. —
779 Those units of local government electing to adopt a written
780 investment policy as provided in subsections (1)-(15) may by
781 resolution invest and reinvest any surplus public funds in their
782 control or possession in:
783 (c) Interest-bearing time deposits or savings accounts in
784 qualified public depositories as defined in s. 280.02.
785 (17) AUTHORIZED INVESTMENTS; NO WRITTEN INVESTMENT
786 POLICY.—Those units of local government electing not to adopt a
787 written investment policy in accordance with investment policies
788 developed as provided in subsections (1)-(15) may invest or
789 reinvest any surplus public funds in their control or possession
790 in:
791 (c) Interest-bearing time deposits or savings accounts in
792 qualified public depositories, as defined in s. 280.02.
793
794 The securities listed in paragraphs (c) and (d) shall be
795 invested to provide sufficient liquidity to pay obligations as
796 they come due.
797 (23) AUTHORIZED DEPOSITS.—In addition to the investments
798 authorized for local governments in subsections (16) and (17)
799 and notwithstanding any other provisions of law, a unit of l ocal
800 government may deposit any portion of surplus public funds in
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801 its control or possession in accordance with the following
802 conditions:
803 (a) The funds are initially deposited in a qualified
804 public depository, as defined in s. 280.02, selected by the uni t
805 of local government.
806 Section 29. For the purpose of incorporating the amendment
807 made by this act to section 280.02, Florida Statutes, in a
808 reference thereto, paragraph (h) of subsection (4) of section
809 255.502, Florida Statutes, is reenacted to read:
810 255.502 Definitions; ss. 255.501-255.525.—As used in this
811 act, the following words and terms shall have the following
812 meanings unless the context otherwise requires:
813 (4) "Authorized investments" means and includes without
814 limitation any investment in:
815 (h) Savings accounts in, or certificates of deposit of,
816 qualified public depositories as defined in s. 280.02, in an
817 amount that does not exceed 15 percent of the net worth of the
818 institution, or a lesser amount as determined by rule by the
819 State Board of Administration, provided such savings accounts
820 and certificates of deposit are secured in the manner prescribed
821 in chapter 280.
822
823 Investments in any security authorized in this subsection may be
824 under repurchase agreements or reverse repurchase agreements .
825 Section 30. For the purpose of incorporating the amendment
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826 made by this act to section 280.02, Florida Statutes, in
827 references thereto, subsections (1) and (2) of section 331.309,
828 Florida Statutes, are reenacted to read:
829 331.309 Treasurer; depositories; fiscal agent.—
830 (1) The board shall designate an individual who is a
831 resident of the state, or a qualified public depository as
832 defined in s. 280.02, as treasurer of Space Florida, who shall
833 have charge of the funds of Space Florida. Such funds shal l be
834 disbursed only upon the order of or pursuant to the resolution
835 of the board by warrant, check, authorization, or direct deposit
836 pursuant to s. 215.85, signed or authorized by the treasurer or
837 his or her representative or by such other persons as may be
838 authorized by the board. The board may give the treasurer such
839 other or additional powers and duties as the board may deem
840 appropriate and shall establish the treasurer's compensation.
841 The board may require the treasurer to give a bond in such
842 amount, on such terms, and with such sureties as may be deemed
843 satisfactory to the board to secure the performance by the
844 treasurer of his or her powers and duties. The board shall audit
845 or have audited the books of the treasurer at least once a year.
846 (2) The board is authorized to select as depositories in
847 which the funds of the board and of Space Florida shall be
848 deposited any qualified public depository as defined in s.
849 280.02, upon such terms and conditions as to the payment of
850 interest by such depository upon the funds so deposited as the
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851 board may deem just and reasonable. The funds of Space Florida
852 may be kept in or removed from the State Treasury upon written
853 notification from the chair of the board to the Chief Financial
854 Officer.
855 Section 31. For the purpose of incorporating the amendment
856 made by this act to section 280.02, Florida Statutes, in a
857 reference thereto, subsection (2) of section 373.553, Florida
858 Statutes, is reenacted to read:
859 373.553 Treasurer of the board; payment of funds;
860 depositories.—
861 (2) The board is authorized to select as depositories in
862 which the funds of the board and of the district shall be
863 deposited in any qualified public depository as defined in s.
864 280.02, and such deposits shall be secured in the manner
865 provided in chapter 280.
866 Section 32. For the purpose of incorporating the amendment
867 made by this act to section 280.02, Florida Statutes, in a
868 reference thereto, section 631.221, Florida Statutes, is
869 reenacted to read:
870 631.221 Deposit of moneys collected.—The moneys collected
871 by the department in a proceeding under this chapter shall be
872 deposited in a qualified public depository as defined in s.
873 280.02, which depository with regards to such funds shall
874 conform to and be bound by all the provisions of chapter 280, or
875 invested with the Chief Financial Officer pursuant to chapter
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876 18. For the purpose of accounting for the assets and
877 transactions of the estate, the receiver shall use such
878 accounting books, records, and systems as the court directs
879 after it hears and considers the recommendations of the
880 receiver.
881 Section 33. For the purpose of incorporating the amendment
882 made by this act to section 280.02, Florida Statutes, in a
883 reference thereto, paragraph (c) of subsection (3) of section
884 723.06115, Florida Statutes, is reenacted to read:
885 723.06115 Florida Mobile Home Relocation Trust Fund. —
886 (3) The department shall distribute moneys in the Florida
887 Mobile Home Relocation Trust Fund to the Florida Mobile Home
888 Relocation Corporation in accordance with the following:
889 (c) Funds transferred from the trust fund to the
890 corporation shall be transferred electronically and shall be
891 transferred to and maintained in a qualified public depository
892 as defined in s. 280.02 which is specified by the corporation.
893 Section 34. This act shall take effect July 1, 2022.
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CODING: Words stricken are deletions; words underlined are additions.
hb1559-00
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