1999-003-CHAPTER 2256 OF THE TEXAS GOVERNMENT CODE, PUBLIC FUND INVESTMENT ACT

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Notes of Decisions sure:- to invest those f~,cis in accordance with Public Funds lnves=ent Act. Op..oUty.Gen. 1992. No. DM-96. I - GENERAL GOVERNMENT Ch. 2256 deposit. withdrOlw. .tnlnsf<r, or mOlnag< in any or.her mOlnn<r r.he funds of the investing <ntily."; in subsec. (h). inserted "for any investing entity or.h<r r.han for r.hat commission": in subs<c. (i). substituted "a business org,nizOltion offering to engage in an invesunent tr::ms:lction with" for .'an entity seeking to sell an investment ~to". insen<d "For purposes of r.his subsection. an inveslme:1l officer has ol personal business rela. tionship wir.h a business organizOltion if:", and added subds. (I) to (3): in subs<c. (k). substirut- cd "offering to eng01ge in :10 investment tr:lnsac- tion with an investing entity" for "seeking to sell to r.he entity an aur.horiz<d investment", insened "For p;'rposes of r.his subsection. a business organization inc1udos investment pools. Nothing in r.his subs<ction relieves r.h< investing entity of r.h< responsibility for monitor- ing the inveStmenLS made by r.he investing entity to de:e:-rnine r.hat r.hey are in compliance with r.he investment polic)',", substirut<d "quo.lified representative" for "registered principal", sub- stituted "offering to engage in an investment transac::ion with an investine entity" for- "seek. ing to sell an authorized in;estment", insenod "in a form acceptable to r.he investing entity and r.he business oreanization", substirut<d "busi. ness organization" for "regisl<red principal". in subd. (J " deleted "thoroughly", in subd. (2). . Person responsible 1 1. Pe:-:son responsible Commissioners coun may designate which county funds are to be invested and direct Ir<". . 9 2256.006 inserted "business", deleted "imprudent invest- ment activities arising out or', and inserted "r.hat are not aur.horized by the entity's invest- me'll policy: except to the extent that this autho- rintion is dependent on an analysis of the m:>.keup of the entity's entire porJolio or re- quires an interpretation of subjective investment standards"; and in subsec. (/), substiruted "ac. quire or otherwise obtain any authorized invest- ment described in the investment policy of r.he investing entity" for "buy any securities", and substiruted ..the insrr.unent required" for "Oln instrUment in substantially r.he form provided". For applic:>.tion pro';sions of AcLS 1997, 75r.h Leg., ch. 1421, see notes following V.T.C.A.. Gove:nm<nt Code g 2256.002. Prior uws: Ac:s 1979, 66th L~~.. p. 2071. ch. 810. Ac:s 1987. 70th Le2.. ch. BS9. Acts 1989, 71st Le;.. en. 628. g 2. Acts 1989, 71st Leg.. cn. 693, gg 2,3. Vemon's Ann.Civ.SL. ar..s. 8423-2. ~ 5; 4413(3':c), ~g 2(2.1, (b), 3(2.), (b). AcLS 1993, 73rd Le2.. ch. 268. g 1. V.T.C.A.. Gove,m;,ent Code gg 2256.004. 2256.052,2256.0054, 2256.055. J ~ 2256.006. Standard of Care (a) Investments shall be made with judg,uent and care, under prevailing circumstances, . that a person of prudence, discretion, and intelligence would exercise in the management of the person's own affairs, not for speculation, but for investment, considering the probable safety of capit.al and the probable income to be derived. Investment of funds shall be governed bv the following investment objectives, in order of priority: - . - (1) preservation and safety of principal: (2) liquidity; and (3) yield. (b) In detennhling whether an investment officer has exercised prude:1ce with respect to an investment decision. the determination shall be made taking into consideration: . (I) the investment of all funds, or funds under the enr:ity's control, over which the officer had responsibility rather than a consideration as to the ~-;.. prudence of a single investment: and :