state treasurer; technical
changes
Makes technical changes to conform with existing standards
for State Treasurer language and makes various substantive changes to
administrative policies within the State Treasurer’s Office.
History:
Laws 2000, Chapter 193, made numerous technical corrections to fix inaccurate and obsolete statutory language relating to the State Treasurer’s office. These changes were related to creation of funds, deposit of monies, investment of monies and various other statutes related to the State Treasurer’s Office. This bill also makes substantive changes to the State Treasurer’s office practices. The following is background information on these issues.
Urban In-Lieu Fund: Under current statutes, any
municipality, which is exempt from property taxes and owns remote property, may
pay a voluntary in-lieu payment of property taxes to the county in which the
property is located. In order to allow
for the bonding of these monies, the payments are made to the State Treasurer’s
Office and dispersed to the counties in monthly increments. However, the option to bond the funds has
never been utilized and, according to the State Treasurer’s Office, there is no
benefit from this pass-through function.
Special Taxing Districts: Also under current statute, all special taxing districts must submit their annual reports to the county board of supervisors and the State Treasurer’s Office. The State Treasurer’s Office serves in a library capacity, housing the annual reports without any oversight or auditing functions. According to the State Treasurer’s Office, there is no formal connection between special taxing districts and the Treasurer’s Office and their involvement in this process provides no benefit.
Investments: Currently, several funds are restricted to investment in bonds or notes bearing the full faith and credit of the United States. While this restriction is necessary for numerous funds, several other funds that do not require such language are similarly restricted limiting investment yields to these funds.
Criminal Background Checks: The Arizona State Treasurer’s Office anticipates some employee turnover and is currently unable to request criminal background checks from the Department of Public Safety (DPS) and would have to rely on private agencies for criminal background checks.
According to the State Treasurer’s Office, there is no expected fiscal impact to either the state general fund or the State Treasurer’s Office as a result of S.B. 1138
Provisions:
· References the appropriate statutes relating to the State Treasurer’s deposit process.
· Changes the process from crediting to depositing funds that are moved from the new school facilities fund to the capitol reserve fund.
· Changes existing bonds, public monies and state highway fund investment language with standardized language recommended by Legislative Council.
· Repeals language relating to endorsement fund and securities sales.
· Consolidates exiting language relating to equity investment of trusts and adds language that conforms to Article X of the Arizona State Constitution, which both restricts the stocks eligible for purchase and limits the percentage of a fund that may be invested in equity securities in the same institution to five percent.
· Eliminates references to appropriations for the deficiencies correction fund, the building renewal fund and the state school facilities revenue bond debt service fund.
· Specifies that monies resulting from the Arizona Power Authority’s operations are deposited in the Arizona Power Authority fund.
· Specifies that the percentage of equity investment shall be calculated at cost.
· Eliminates the Urban-In-Lieu Payment Fund and the pass-through requirement for Urban-In-Lieu payments. Transactions would occur between the city and county government involved.
· Eliminates the dual-reporting requirement for Special Taxing Districts to the State Treasurer and the County Supervisors; instead it would only require reporting to the County Supervisors.
· Allows funds that requires US Government investment instruments the additional authority to invest in US Government agency bonds issued by agencies other than the Treasury Department.
· Expands authorized investment instruments for the Highway User Revenue Fund, Local Transportation Assistance Fund and the State Aviation Fund to the authorized investments allowed. These include any obligations issued or guaranteed by the United States or any of its agencies, sponsored agencies, corporations, or instrumentalities.
· Eliminates outdated, unused and duplicative language regarding investment programs and instruments.
· Allows the State Treasurer to request criminal history reports from DPS for personnel purposes.
· Contains several technical changes and conforming language for blending purposes.
SB 1138 was amended in
the Ways and Means Committee as follows: