BILL ANALYSIS �
AB 2298
Page 1
CONCURRENCE IN SENATE AMENDMENTS
AB 2298 (Rodriguez)
As Amended June 10, 2014
Majority vote
-----------------------------------------------------------------
|ASSEMBLY: |73-0 |(May 8, 2014) |SENATE: |35-0 |(July 3, 2014) |
-----------------------------------------------------------------
Original Committee Reference: B. & F.
SUMMARY : Allows state chartered financial institutions that
maintain local agency deposits to submit their Local Agency
Deposit Weekly Reports via email or other electronic means.
The Senate amendments provide that the Local Agency Deposit
Weekly Reports may be provided by other electronic means rather
than by facsimile.
EXISTING LAW , pursuant to Government Code Section 53663,
provides that financial institutions that hold local agency
deposits must report on the status of those deposits on a weekly
basis. These reports must be hand delivered, or sent via United
States Postal Service mail.
Government Code Sections 16340, 16429.1, 53601, 53601.6,
53601.8, 53635, 53635.2, 53638,
and 53684 specify permissible types of investments that local
agencies may invest in.
FISCAL EFFECT : According to the Senate Appropriations
Committee, pursuant to Senate Rule 28.8, negligible state costs.
COMMENTS : California law allows local agencies to invest
surplus funds into various specified investment vehicles. For
example, up to 30% of local agency funds can be invested in
certificates of deposit at financial institutions. California
regulated state banks and credit unions are required to report
weekly on the status of those investments to the Department of
Business Oversight. This bill would simply allow the weekly
reports to be provided electronically via email or facsimile.
Local Agency Investments. While not addressed specifically in
this bill, it may be worthy to note some background information
AB 2298
Page 2
regarding the permissible investments allowed under the
Government Code for local agencies.
To be eligible to receive local agency money, a financial
institution must receive an overall rating of not less than
"satisfactory" from the appropriate federal supervisory agency
for meeting the criteria specified in Title 12 of the United
States Code Section 2906 (Community Reinvestment Act of 1977).
The Community Reinvestment Act of 1977 requires financial
institutions to demonstrate their commitment to meeting the
credit needs of local communities in which they are chartered to
do business.
Analysis Prepared by : Mark Farouk / B. & F. / (916) 319-3081
FN: 0004070