House Study Bill 504 - Introduced HOUSE FILE _____ BY (PROPOSED COMMITTEE ON COMMERCE BILL BY CHAIRPERSON COWNIE) A BILL FOR An Act authorizing political subdivisions to invest in certain 1 joint investment trusts that are operated in accordance with 2 the governmental accounting standards board. 3 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 4 TLSB 5448YC (2) 86 gh/sc
H.F. _____ Section 1. Section 12B.10, subsection 5, paragraph a, 1 subparagraph (7), Code 2016, is amended to read as follows: 2 (7) (a) A joint investment trust organized pursuant 3 to chapter 28E prior to and existing in good standing on 4 the effective date of this Act or a joint investment trust 5 organized pursuant to chapter 28E after April 28, 1992, 6 provided that the joint investment trust shall either be rated 7 one of the following: 8 (i) Rated within the two highest classifications by at 9 least one of the standard rating services approved by the 10 superintendent of banking by rule adopted pursuant to chapter 11 17A and operated in accordance with either 17 C.F.R. §270.2a-7, 12 or be registered with the requirements of the governmental 13 accounting standards board for external investment pools. 14 (ii) Registered with the federal securities and exchange 15 commission under the federal Investment Company Act of 1940, 16 15 U.S.C. §80a-1, and operated in accordance with 17 C.F.R. 17 §270.2a-7. 18 (b) The manager or investment advisor of the joint 19 investment trust shall be registered with the federal 20 securities and exchange commission under the Investment Advisor 21 Act of 1940, 15 U.S.C. §80b-1. 22 EXPLANATION 23 The inclusion of this explanation does not constitute agreement with 24 the explanation’s substance by the members of the general assembly. 25 Under current law, political subdivisions are authorized 26 to invest public funds in joint investment trusts that are 27 operated in accordance with federal law relating to money 28 market funds and that have either achieved a specified rating 29 or are registered with the federal Securities and Exchange 30 Commission. 31 This bill provides that those joint investment trusts that 32 have achieved the required specified rating must be operated in 33 accordance with either the federal law relating to money market 34 funds or with the governmental accounting standards board’s 35 -1- LSB 5448YC (2) 86 gh/sc 1/ 2
H.F. _____ requirements for external investment pools. 1 -2- LSB 5448YC (2) 86 gh/sc 2/ 2