Section 301.1. Investment of Moneys.--(a) The Treasury Department may, from time to time, invest in direct short-term obligations of the United States government such amounts of the moneys of the Commonwealth, with the exception of moneys in any fund authorized by law to be invested by any board, commission or State officer, on deposit from time to time in State depositories, as shall have accumulated beyond the ordinary needs of various funds. The Treasury Department shall, from time to time as necessary, sell such short-term obligations and deposit the proceeds in State depositories as provided by this act. The Treasury Department shall not, at any one time, have invested in short-term obligations of the United States government more than an aggregate of such total sum as the Board of Finance and Revenue shall, by resolution, with the Governor's approval, have prescribed.
(b) The Treasury Department may, from time to time, invest its excess funds in United States Treasury and United States Agency obligations, with a maturity of up to and including two years.
(c) The Treasury Department may, from time to time, subject to the hereinafter stated conditions and limitations, invest and reinvest the moneys of any fund as shall have accumulated beyond the ordinary needs of the various funds, and which are not authorized by law to be invested by any board, commission or State officer in commercial paper.
As used herein, "commercial paper" shall mean unsecured promissory notes issued either in discount or interest-bearing form by any industrial, common carrier, or finance company and must bear Moody's Credit Service "Prime One Rating," or the equivalent by Standard and Poor's or Fitch's Rating Service.
The Treasury Department shall not, at any time, have invested in commercial paper more than an aggregate of such total sum as the Board of Finance and Revenue shall, by resolution, with the Governor's approval, have prescribed.
(d) The Treasury Department may, from time to time pursuant to regulations adopted by the Board of Finance and Revenue invest and reinvest such moneys of any fund as shall be accumulated beyond the ordinary needs of the various funds and which are not authorized by law to be invested by any other board or commission or State officer by purchasing certificates of deposit from commercial banks domiciled in this Commonwealth up to the level equal to twenty per centum of such bank's total capital and surplus. Certificates of deposit may likewise be purchased from savings and loan associations or savings banks domiciled in the Commonwealth up to a level equal to twenty per centum of such association's or savings bank's assets minus liabilities. Such certificates of deposit need not be collateralized. In applying the proceeding limitation on investments in certificates of deposit, the Treasury Department must include the similar investments of the State Employees' Retirement Board and the Public School Employees' Retirement Board. The Treasury Department shall not at anytime have invested in uncollateralized certificates of deposit more than the total amount authorized by resolution of the Board of Finance and Revenue and approved by the Governor. The Treasury Department shall purchase certificates of deposit under this subsection pursuant to procedures established in regulations by the Board of Finance and Revenue and shall take into account the differences, if any, in competitive bids, the financial strength of each of the bidders and the services provided to or at the request of the Commonwealth and any of its departments, agencies or bureaus by each of the bidders.
(e) The Treasury Department may from time to time enter into repurchase agreements secured by Federal obligations.
(f) The Treasury Department may, from time to time, invest its excess funds in Banker's Acceptances.
As used herein, "Banker's Acceptances" shall mean short term trade financing agreements secured by the accepting bank and the goods being purchased, and shall be limited to domestic banks whose parent companies bear a Moody's Credit Service "AA Rating," or the equivalent by Standard and Poor's or Fitch's Rating Service.
(g) Notwithstanding any limitations, conditions or restrictions imposed on the making of investments by this act, except those contained in subsection (h), and notwithstanding any limitations, conditions or restrictions imposed by any other law, the Treasury Department may, at its discretion, invest a maximum of ten per centum of the book value of the assets of the fund in any investments except common stock not otherwise specifically authorized.
(h) All investments allowed under this section must be made with the exercise of that degree of judgment and care under the circumstances then prevailing which persons of prudence, discretion and intelligence exercise in the management of their own affairs not in regard to speculation, but in regard to the permanent disposition of the funds, considering the probable income to be derived therefrom as well as the probable safety of their capital. The exercise of such degree of judgment and care shall include, but shall not be limited to:
(1) The daily investment of available investable funds necessary to maintain maximum effectiveness of the Treasury Department investment portfolio at all times.
(2) The maintenance of portfolio reporting system.
(3) The adherence to Moody's Credit Service "Prime One Rating" or the equivalent of Standard and Poor's or Fitch's Rating Service for institutions with whom investments are transacted pursuant to subsection (g).
(4) At least quarter-annual bank performance ranking according to maximum efficiency in cash management.
(h) amended May 2, 1986, P.L.145, No.45)
(i) (1) Notwithstanding subsections (a) through (h), the Treasury Department shall have the exclusive management and full power to invest and reinvest the moneys of any fund as shall be accumulated beyond the ordinary needs of the various funds and which are not authorized by law to be invested by any board, commission or State officer, subject, however, to the exercise of that degree of judgment and care under the circumstances then prevailing which persons of prudence, discretion and intelligence who are familiar with such matters exercise in the management of their own affairs not in regard to speculation but in regard to the permanent disposition of the funds, considering the probable income to be derived therefrom as well as the probable safety of their capital. The Treasury Department shall have the power to hold, purchase, sell, assign, transfer and dispose of any securities and investments in any such fund as well as the proceeds of such investments and of the money belonging to any such fund. The Treasury Department shall, through the Governor, submit to the General Assembly annually, at the same time the Treasury Department submits its budget covering administrative expenses, a report identifying the nature and amount of all existing investments made pursuant to this section.
(2) ((2) repealed June 22, 1999, P.L.99, No.15)
((i) added May 7, 1998, P.L.345, No.53)
(301.1 amended May 7, 1982, P.L.390, No.113)