Colorado Legislative Council Staff

STATE

FISCAL NOTE

General Fund Revenue Impact

Cash Fund Revenue Impact

TITLE:            CONCERNING THE ELIMINATION OF THE MANAGEMENT FEE IMPOSED ON THE INVESTMENT OF CERTAIN STATE MONEYS BY THE STATE TREASURER.

Summary of Legislation

            Under current law, the State Treasurer charges a monthly management fee in the amount of 15 percent of the investment earnings of certain cash funds. The fee is deducted from the investment income on the fund or account, and is credited to the state General Fund. This bill would eliminate this management fee.

            The bill will increase revenues to affected cash funds, and reduce the revenues to the General Fund by a corresponding amount. Therefore, the bill is assessed as having state fiscal impact. The bill will become effective at 12:01 a.m. on the day following the ninety-day period after adjournment sine die of the General Assembly, or on the date of the official declaration of the vote of the people as proclaimed by the Governor, if a referendum petition is filed pursuant to Article V, Section 1 (3) of the State Constitution.

State Revenues

          The bill would eliminate the 15 percent monthly management fee charged by the State Treasurer on the investment earnings of certain cash funds. During FY 1996-97, management fee earnings credited to the state General Fund was $8.9 million. The impact of the bill in future years will be based on cash balances earning interest in funds that are affected by the bill. The amount of the reduction in General Fund earnings will be offset by a corresponding increase in cash fund interest earnings.

Spending Authority

            The fiscal note would imply that no appropriations or spending authority are required in FY 1998-99 to implement the provisions of the bill.

Departments Contacted

          State Treasurer