2003-2004 Bill 668: Letter of credit; local governments, political subdivisions and school districts authorized to secure deposits made in the name of

South Carolina General Assembly
115th Session, 2003-2004

Download This Bill in Microsoft Word format

A270, R341, S668

STATUS INFORMATION

General Bill
Sponsors: Senator Ritchie
Document Path: l:\council\bills\dka\3484dw03.doc

Introduced in the Senate on April 29, 2003
Introduced in the House on April 13, 2004
Last Amended on April 6, 2004
Passed by the General Assembly on May 26, 2004
Governor's Action: July 16, 2004, Signed

Summary: Letter of credit; local governments, political subdivisions and school districts authorized to secure deposits made in the name of

HISTORY OF LEGISLATIVE ACTIONS

     Date      Body   Action Description with journal page number
-------------------------------------------------------------------------------
   4/29/2003  Senate  Introduced and read first time SJ-33
   4/29/2003  Senate  Referred to Committee on Judiciary SJ-33
   3/17/2004  Senate  Committee report: Favorable with amendment Judiciary 
                        SJ-30
    4/6/2004  Senate  Amended SJ-32
    4/6/2004  Senate  Read second time SJ-32
    4/7/2004  Senate  Read third time and sent to House SJ-23
   4/13/2004  House   Introduced and read first time HJ-12
   4/13/2004  House   Referred to Committee on Labor, Commerce and Industry 
                        HJ-13
   5/19/2004  House   Committee report: Favorable Labor, Commerce and Industry
   5/25/2004  House   Read second time HJ-30
   5/26/2004  House   Read third time and enrolled HJ-8
    6/2/2004          Ratified R 341
   7/16/2004          Signed By Governor
   7/26/2004          Copies available
   7/26/2004          Effective date 07/16/04
   7/28/2004          Act No. 270

View the latest legislative information at the LPITS web site

VERSIONS OF THIS BILL

4/29/2003
3/17/2004
4/6/2004
5/19/2004

(Text matches printed bills. Document has been reformatted to meet World Wide Web specifications.)

(A270, R341, S668)

AN ACT TO AMEND THE CODE OF LAWS OF SOUTH CAROLINA, 1976, BY ADDING SECTION 6-5-15 SO AS TO AUTHORIZE A BANK OR SAVINGS AND LOAN ASSOCIATION, UPON DEPOSIT OF FUNDS BY A MUNICIPALITY, COUNTY, SCHOOL DISTRICT, OTHER LOCAL GOVERNMENT UNIT OR POLITICAL SUBDIVISION, OR A COUNTY TREASURER, TO SECURE THE DEPOSITS BY DEPOSIT INSURANCE, SURETY BONDS, COLLATERAL SECURITIES, OR LETTERS OF CREDIT TO PROTECT THE LOCAL ENTITY AGAINST LOSS, AND TO PROVIDE THE REQUIREMENTS FOR SECURING DEPOSITS THAT EXCEED THE AMOUNT OF INSURANCE COVERAGE PROVIDED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION.

Be it enacted by the General Assembly of the State of South Carolina:

Securing deposits of certain local governments

SECTION 1. Chapter 5, Title 6 of the 1976 Code is amended by adding:

"Section 6-5-15. (A) As used in this section, 'local entity' means the governing body of a municipality, county, school district, other local government unit or political subdivision, or a county treasurer.

(B) A bank or savings and loan association, upon the deposit of funds by a local entity, must secure these deposits by deposit insurance, surety bonds, collateral securities, or letters of credit to protect the local entity against loss in the event of insolvency or liquidation of the institution or for any other cause.

(C) To the extent that these deposits exceed the amount of insurance coverage provided by the Federal Deposit Insurance Corporation, the bank or savings and loan association at the time of deposit must:

(1) furnish an indemnity bond in a responsible surety company authorized to do business in this State; or

(2) pledge as collateral:

(a) obligations of the United States;

(b) obligations fully guaranteed both as to principal and interest by the United States;

(d) obligations of the Federal National Mortgage Association, the Federal Home Loan Bank, Federal Farm Credit Bank, or the Federal Home Loan Mortgage Corporation; or

(3) provide an irrevocable letter of credit issued by the Federal National Mortgage Association, the Federal Home Loan Bank, Federal Farm Credit Bank, or the Federal Home Loan Mortgage Corporation, in which the local entity is named as beneficiary and the letter of credit otherwise meets the criteria established and prescribed by the local entity.

(D) The local entity must exercise prudence in accepting collateral securities or other forms of deposit security."

Time effective

SECTION 2. This act takes effect upon approval by the Governor.

Ratified the 2nd day of June, 2004.

Approved the 16th day of July, 2004.

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This web page was last updated on Monday, December 7, 2009 at 10:18 A.M.