Date: 02/23/2006

Final
BILL SUMMARY for HB06-1287

HOUSE COMMITTEE ON FINANCE

Votes: View--> Action Taken:
Moved a "no" vote on severed section II of amendme
Moved severed section 1 of amendment L.001 (severe
Refer House Bill 06-1287, as amended, to the Commi
Pass Without Objection
Pass Without Objection
PASS


10:21 AM -- House Bill 06-1287 - Concerning the Investment of Public Funds

Representative Stafford, prime sponsor, explained that House Bill 06-1287 clarifies and amends existing language regarding the investment of public funds. It clarifies the duration of security maturity periods, reorganizes requirements for investing public funds in certain securities, and requires public entities to update their investment policies. Representative Stafford said that the bill includes nonprofit corporations in the definition of public entity, and specifies that funds invested for employee retirement or pensions are not public funds. She said the bill also provides additional flexibility for public entities to manage investments which could potentially increase investment earnings.

The following persons testified:

10:27 AM --
Mr. John Lefebvre, Colorado County Treasurer's Association and Adams County Treasurer, testified in support of the measure.

10:34 AM -- Mr. Glenn Scott, Colorado County Treasurer's Association, responded to committee questions and testified in support of the measure. Mr. Scott said that the bill addresses a number of out-dated statutes that guide the investment of public funds. The last time the statutes have been changed was in the early 1980s. Mr. Scott discussed and explained how reverse repurchase agreements on securities work and commented on the entities that trade and sell these investments. The committee and Mr. Scott discussed the county fee-structure and administration of county investment portfolios. Mr. Scott talked about the fees that are charged by outside vendors and said that county governments pay low fees for these transactions. The discussion continued on the bill's language on page 16 that pertains to eligible broker-dealers and the competition that insurance companies could receive from non-insurers should the language on page 16 remain in the bill.

Representative Stafford distributed amendment L.001 to committee members (Attachment A). The committee engaged in a discussion on severing the amendment and the language on lines 14 through 17 on amendment L.001. After a brief discussion, Mr. Ben Stein, Deputy State Treasurer, was called upon to respond to committee questions.

10:43 AM -- Mr. Ben Stein, Deputy State Treasurer, responded to committee questions and explained that the State Treasurer's Office was mainly involved in the technical questions generated by the bill and spoke to investment practices allowed under current law. Mr. Stein said that the bill does not make any substantive changes to current law but clarifies a number of gray areas that have developed over the years. The bill would mainly apply to county treasurers that do not have to comply with specific county-investment statutes. Mr. Stein spoke to a number of issues in amendment L.001 and discussed language that would remain in the amendment. Mr. Stein closed by saying that the amendment adds more public disclosure and transparency to the investment process for public funds. After a brief committee discussion, Mr. Scott was called back to respond to committee questions.

10:49 AM -- Mr. Scott spoke to amendment L.001 saying that the language on page 12, lines 11 through 16, applies to the sale and investment of bond proceeds. Mr. Scott continued to discuss current law and the amendment commenting on the investment practices of insurance companies when investing public funds. Provisions of the amendment limit the entities that can invest public funds.

11:05 AM -- Ms. Ester van Mourik, Office of Legislative Legal Services, responded to committee questions and commented on changing provisions in amendment L.001. After a brief committee discussion, Representative Vigil, Chairman, said that the committee would take action on the amendment by severing the amendment into two sections; severed section 1 would include lines 1 through 13 of amendment L.001 and severed section 2 would include the remaining provisions in the amendment or lines 14 through 17. The committee took action and adopted severed section 1 of amendment L.001 thus, adopting lines 1 through 13 of the amendment. After severed section 1 of amendment L.001 was adopted, House Bill 06-1287 was referred to the Committee of the Whole.
BILL:HB06-1287
TIME: 11:18:46 AM
MOVED:Judd
MOTION:Moved severed section 1 of amendment L.001 (severed section 1 includes page 1, lines 1 through 13 of L.001). The motion passed without objection by those members present.
SECONDED:Benefield
VOTE
Benefield
Cloer
Crane
Frangas
Garcia
Harvey
Jahn
Kerr
Marshall
Massey
McCluskey
Excused
Judd
Vigil
Not Final YES: 0 NO: 0 EXC: 1 ABS: 0 FINAL ACTION: Pass Without Objection
BILL:HB06-1287
TIME: 11:20:03 AM
MOVED:Judd
MOTION:Moved a "no" vote on severed section II of amendment L.001 (severed section II includes page 1, lines 14 through 17 of L.001). The motion passed without objection by those members present. (This motion strikes lines 14 through 17 in amendment L.001).
SECONDED:Harvey
VOTE
Benefield
Cloer
Crane
Frangas
Garcia
Harvey
Jahn
Kerr
Marshall
Massey
McCluskey
Excused
Judd
Vigil
Not Final YES: 0 NO: 0 EXC: 1 ABS: 0 FINAL ACTION: Pass Without Objection
BILL:HB06-1287
TIME: 11:20:45 AM
MOVED:Judd
MOTION:Refer House Bill 06-1287, as amended, to the Committee of the Whole. The motion passed on a 12-0-1 vote.
SECONDED:Cloer
VOTE
Benefield
Yes
Cloer
Yes
Crane
Yes
Frangas
Yes
Garcia
Yes
Harvey
Yes
Jahn
Yes
Kerr
Yes
Marshall
Yes
Massey
Yes
McCluskey
Excused
Judd
Yes
Vigil
Yes
Final YES: 12 NO: 0 EXC: 1 ABS: 0 FINAL ACTION: PASS