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90_HB2630ham001 LRB9008551JMmbam02 1 AMENDMENT TO HOUSE BILL 2630 2 AMENDMENT NO. . Amend House Bill 2630 by replacing 3 everything after the enacting clause with the following: 4 "Section 5. The Public Funds Investment Act is amended 5 by adding Section 2.5 as follows: 6 (30 ILCS 235/2.5 new) 7 Sec. 2.5. Investment policy. 8 (a) Investment of public funds by a public agency shall 9 be governed by a written investment policy adopted by the 10 public agency. The level of detail and complexity of the 11 investment policy shall be appropriate to the nature of the 12 funds, the purpose for the funds, and the amount of the 13 public funds within the investment portfolio. The policy 14 shall address safety of principal, liquidity of funds, and 15 return on investment and shall require that the investment 16 portfolio be structured in such manner as to provide 17 sufficient liquidity to pay obligations as they come due. In 18 addition, the investment policy shall include or address the 19 following: 20 (1) a listing of authorized investments; 21 (2) a rule, such as the "prudent person rule", 22 establishing the standard of care that must be maintained -2- LRB9008551JMmbam02 1 by the persons investing the public funds; 2 (3) investment guidelines that are appropriate to 3 the nature of the funds, the purpose for the funds, and 4 the amount of the public funds within the investment 5 portfolio; 6 (4) a policy regarding diversification of the 7 investment portfolio that is appropriate to the nature of 8 the funds, the purpose for the funds, and the amount of 9 the public funds within the investment portfolio; 10 (5) guidelines regarding collateral requirements, 11 if any, for the deposit of public funds in a financial 12 institution made pursuant to this Act, and, if 13 applicable, guidelines for contractual arrangements for 14 the custody and safekeeping of that collateral; 15 (6) a policy regarding the establishment of a 16 system of internal controls and written operational 17 procedures designed to prevent losses of funds that might 18 arise from fraud, employee error, misrepresentation by 19 third parties, or imprudent actions by employees of the 20 entity; 21 (7) identification of the chief investment officer 22 who is responsible for establishing the internal controls 23 and written procedures for the operation of the 24 investment program; 25 (8) performance measures that are appropriate to 26 the nature of the funds, the purpose for the funds, and 27 the amount of the public funds within the investment 28 portfolio; 29 (9) a policy regarding appropriate periodic review 30 of the investment portfolio, its effectiveness in meeting 31 the public agency's needs for safety, liquidity, rate of 32 return, and diversification, and its general performance; 33 (10) a policy establishing at least quarterly 34 written reports of investment activities by the public -3- LRB9008551JMmbam02 1 agency's chief financial officer for submission to the 2 governing body and chief executive officer of the public 3 agency. The reports shall include information regarding 4 securities in the portfolio by class or type, book value, 5 income earned, and market value as of the report date; 6 (11) a policy regarding the selection of investment 7 advisors, money managers, and financial institutions; and 8 (12) a policy regarding ethics and conflicts of 9 interest. 10 (b) For purposes of the State or a county, the 11 investment policy shall be adopted by the elected treasurer 12 and presented to the chief executive officer and the 13 governing body. For purposes of any other public agency, the 14 investment policy shall be adopted by the governing body of 15 the public agency. 16 (c) The investment policy shall be made available to the 17 public at the main administrative office of the public 18 agency. 19 (d) The written investment policy required under this 20 Section shall be developed and implemented by January 1, 21 2000. 22 Section 99. Effective date. This Act takes effect upon 23 becoming law.".
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