State Codes and Statutes

State Codes and Statutes

Statutes > Nebraska > Chapter30 > 30-3209

30-3209. Corporate trustee; retirement orpension funds of governmental employees; investments authorized.(1) Corporate trustees authorized by Nebraska law to exercise fiduciarypowers and holding retirement or pension funds for the benefit of employeesor former employees of cities, villages, school districts, public power districts,or other governmental or political subdivisions may invest and reinvest suchfunds in such securities and investments as are authorized for trustees, guardians,conservators, personal representatives, or administrators under the laws ofNebraska. Retirement or pension funds of such cities, villages, districts,or subdivisions may be invested in annuities issued by life insurance companiesauthorized to do business in Nebraska. Except as provided in subsection (2)of this section, any other retirement or pension funds of cities, includingcities operating under home rule charters, villages, school districts exceptas provided in section 79-9,107, public power districts, and all other governmentalor political subdivisions may be invested and reinvested, as the governingbody of such city, village, school district, public power district, or othergovernmental or political subdivision may determine, in the following classesof securities and investments: (a) Bonds, notes, or other obligations of theUnited States or those guaranteed by or for which the credit of the UnitedStates is pledged for the payment of the principal and interest or dividendsthereof; (b) bonds or other evidences of indebtedness of the State of Nebraskaand full faith and credit obligations of or obligations unconditionally guaranteedas to principal and interest by any other state of the United States; (c)bonds, notes, or obligations of any municipal or political subdivision ofthe State of Nebraska which are general obligations of the issuer thereofand revenue bonds or debentures of any city, county, or utility district ofthis state when the earnings available for debt service have, for a five-yearperiod immediately preceding the date of purchase, averaged not less thanone and one-half times such debt service requirements; (d) bonds and debenturesissued either singly or collectively by any of the twelve federal land banks,the twelve intermediate credit banks, or the thirteen banks for cooperativesunder the supervision of the Farm Credit Administration; (e) certificatesof deposit of banks which are members of the Federal Deposit Insurance Corporationor capital stock financial institutions, and if the amount deposited exceedsthe amount of insurance available thereon, then the excess shall be securedin the same manner as for the deposit of public funds; (f) accounts with buildingand loan associations, qualifying mutual financial institutions, or federalsavings and loan associations in the State of Nebraska to the extent thatsuch accounts are insured orguaranteed by the Federal Deposit Insurance Corporation; (g) bondsor other interest-bearing obligations of any corporation organized under thelaws of the United States or any state thereof if (i) at the time the purchaseis made, they are given, by at least one statistical organization whose publicationis in general use, one of the three highest ratings given by such organizationand (ii) not more than five percent of the fund shall be invested in the obligationsof any one issuer; (h) direct short-term obligations, generally classifiedas commercial paper, of any corporation organized or existing under the lawsof the United States or any state thereof with a net worth of ten milliondollars or more; and (i) preferred or common stock of any corporation organizedunder the laws of the United States or of any state thereof with a net worthof ten million dollars or more if (i) not more than fifty percent of the totalinvestments at the time such investment is made is in this class and not morethan five percent is invested in each of the first five years and (ii) notmore than five percent thereof is invested in the securities of any one corporation.Notwithstanding the percentage limits stated in this subsection, the cashproceeds of the sale of such preferred or common stock may be reinvested inany securities authorized under this subdivision. No city, village, schooldistrict, public power district, or other governmental subdivision or thegoverning body thereof shall be authorized to sell any securities short, buyon margin, or buy, sell, or engage in puts and calls. Section 77-2366 shallapply to deposits in capital stock financial institutions. Section 77-2365.01shall apply to deposits in qualifying mutual financial institutions.(2) Notwithstanding the limitations prescribed in subsection (1) ofthis section, trustees holding retirement or pension funds for the benefitof employees or former employees of any city of the metropolitan class, metropolitanutilities district, or county in which a city of the metropolitan class islocated shall invest such funds in investments of the nature which individualsof prudence, discretion, and intelligence acquire or retain in dealing withthe property of another. Such investments shall not be made for speculationbut for investment, considering the probable safety of their capital as wellas the probable income to be derived. The trustees shall not buy on margin,buy call options, or buy put options. The trustees may lend any security ifcash, United States Government obligations, or United States Government agencyobligations with a market value equal to or exceeding the market value ofthe security lent are received as collateral. If shares of stock are purchasedunder this subsection, all proxies may be voted by the trustees. The assetallocation restrictions set forth in subsection (1) of this section shallnot be applicable to the funds of pension or retirement systems administeredby or on behalf of a city of the metropolitan class, metropolitan utilitiesdistrict, or county in which a city of the metropolitan class is located. SourceLaws 1967, c. 257, § 1, p. 678; Laws 1984, LB 752, § 1; Laws 1989, LB 33, § 25; R.S.Supp.,1989, § 24-601.04; Laws 1992, LB 757, § 21; Laws 1996, LB 900, § 1036; Laws 1998, LB 1321, § 78; Laws 2001, LB 362, § 29; Laws 2001, LB 408, § 12; Laws 2009, LB259, § 12.