State Codes and Statutes
Statutes > Texas > Local-government-code > Title-4-finances > Chapter-131-depository-provisions-affecting-funds-of-municipalities-counties-and-other-local-governm
LOCAL GOVERNMENT CODE
TITLE 4. FINANCES
SUBTITLE C. FINANCIAL PROVISIONS APPLYING TO MORE THAN ONE TYPE
OF LOCAL GOVERNMENT
CHAPTER 131. DEPOSITORY PROVISIONS AFFECTING FUNDS OF
MUNICIPALITIES, COUNTIES, AND OTHER LOCAL GOVERNMENTS
SUBCHAPTER A. SPECIAL DEPOSITORY
Sec. 131.001. SPECIAL DEPOSITORY AUTHORIZED. If a financial
institution that is a depository under state law for the public
funds of a county, municipality, or district suspends business or
is taken charge of by a state or federal bank regulatory agency,
the local government authority authorized to select the original
depository may select by contract a special depository for the
public funds in the suspended financial institution.
Acts 1987, 70th Leg., ch. 149, Sec. 1, eff. Sept. 1, 1987.
Amended by Acts 1999, 76th Leg., ch. 344, Sec. 5.010, eff. Sept.
1, 1999.
Sec. 131.002. DUTIES OF SPECIAL DEPOSITORY. The special
depository shall assume the payment of the amount of public funds
due by the suspended bank on the date of its suspension,
including interest to that date, and shall pay that amount to the
designated local government authority in accordance with the
contract entered into by the special depository.
Acts 1987, 70th Leg., ch. 149, Sec. 1, eff. Sept. 1, 1987.
Sec. 131.003. SPECIAL DEPOSITORY CONTRACT. (a) The contract
must require the payment of the deposit in installments as agreed
to by the parties. The last installment must be paid not later
than three years from the date of the contract.
(b) The parties may contract for the installments or the amount
due to be evidenced by negotiable certificates of deposit or
cashier's checks, payable at specified dates.
(c) The contract must set the rate of interest applicable to the
funds placed in the special depository under this subchapter
unless the parties agree that the funds are not to bear interest.
Acts 1987, 70th Leg., ch. 149, Sec. 1, eff. Sept. 1, 1987.
Sec. 131.004. BOND. (a) To secure the performance of a special
depository contract, the special depository shall execute a bond,
or bonds in the case of installments, with the same character of
sureties required for regular depository bonds.
(b) The local government authority authorized by law to approve
a bond of a regularly selected depository must approve a bond of
a special depository.
Acts 1987, 70th Leg., ch. 149, Sec. 1, eff. Sept. 1, 1987.
Sec. 131.005. STATE FUNDS. (a) The comptroller shall determine
the amount of state funds held by a county depository that
suspends business or is taken charge of by a state or federal
bank regulatory agency. The comptroller may:
(1) contract with a special depository selected by the county
authorities as provided by this subchapter for the custody and
payment of those funds; and
(2) approve a bond for the deposit contract.
(b) State funds placed in a special depository as provided by
Subsection (a) shall bear the average rate of interest received
by the state on state funds placed with regularly selected state
depositories.
(c) The comptroller may proceed with available legal remedies
against a suspended bank that is a depository for state funds if
the comptroller considers that action to be in the best interest
of the public.
Added by Acts 1993, 73rd Leg., ch. 268, Sec. 35, eff. Sept. 1,
1993. Amended by Acts 1999, 76th Leg., ch. 344, Sec. 5.011, eff.
Sept. 1, 1999.
SUBCHAPTER Z. MISCELLANEOUS PROVISIONS
Sec. 131.901. OUT-OF-STATE DEPOSITORY PROHIBITED. (a) The
governing body of a political subdivision, including a county,
municipality, school district, or other district, may not
designate a financial institution located outside the state as a
depository for funds under the governing body's jurisdiction. An
out-of-state financial institution is not considered to be
located outside this state to the extent the governing body
designates a branch office of such institution that is located in
this state.
(b) An institution selected as a paying agent or trustee for
specific bonds or obligations or an institution selected by the
governing body to provide safekeeping services is not considered
a depository for purposes of this section.
Acts 1987, 70th Leg., ch. 149, Sec. 1, eff. Sept. 1, 1987.
Amended by Acts 1993, 73rd Leg., ch. 234, Sec. 3, eff. Sept. 1,
1993; Acts 1999, 76th Leg., ch. 344, Sec. 5.012, eff. Sept. 1,
1999.
Sec. 131.902. PURSUIT OF LEGAL REMEDIES AGAINST SUSPENDED BANK.
A county, municipality, or district authority may proceed with
available legal remedies against a suspended bank that is a
depository for public funds of the authority if the authority
considers that action to be in the best interest of the public.
Acts 1987, 70th Leg., ch. 149, Sec. 1, eff. Sept. 1, 1987.
Sec. 131.903. CONFLICT OF INTEREST. (a) A bank is not
disqualified from serving as a depository for funds of a
political subdivision if:
(1) an officer or employee of the political subdivision who does
not have the duty to select the political subdivision's
depository is an officer, director, or shareholder of the bank;
or
(2) one or more officers or employees of the political
subdivision who have the duty to select the political
subdivision's depository are officers or directors of the bank or
own or have a beneficial interest, individually or collectively,
in 10 percent or less of the outstanding capital stock of the
bank, if:
(A) a majority of the members of the board, commission, or other
body of the political subdivision vote to select the bank as a
depository; and
(B) the interested officer or employee does not vote or take
part in the proceedings.
(b) This section may not be construed as changing or superseding
a conflicting provision in the charter of a home-rule
municipality.
Added by Acts 1993, 73rd Leg., ch. 268, Sec. 36, eff. Sept. 1,
1993.
State Codes and Statutes
Statutes > Texas > Local-government-code > Title-4-finances > Chapter-131-depository-provisions-affecting-funds-of-municipalities-counties-and-other-local-governm
LOCAL GOVERNMENT CODE
TITLE 4. FINANCES
SUBTITLE C. FINANCIAL PROVISIONS APPLYING TO MORE THAN ONE TYPE
OF LOCAL GOVERNMENT
CHAPTER 131. DEPOSITORY PROVISIONS AFFECTING FUNDS OF
MUNICIPALITIES, COUNTIES, AND OTHER LOCAL GOVERNMENTS
SUBCHAPTER A. SPECIAL DEPOSITORY
Sec. 131.001. SPECIAL DEPOSITORY AUTHORIZED. If a financial
institution that is a depository under state law for the public
funds of a county, municipality, or district suspends business or
is taken charge of by a state or federal bank regulatory agency,
the local government authority authorized to select the original
depository may select by contract a special depository for the
public funds in the suspended financial institution.
Acts 1987, 70th Leg., ch. 149, Sec. 1, eff. Sept. 1, 1987.
Amended by Acts 1999, 76th Leg., ch. 344, Sec. 5.010, eff. Sept.
1, 1999.
Sec. 131.002. DUTIES OF SPECIAL DEPOSITORY. The special
depository shall assume the payment of the amount of public funds
due by the suspended bank on the date of its suspension,
including interest to that date, and shall pay that amount to the
designated local government authority in accordance with the
contract entered into by the special depository.
Acts 1987, 70th Leg., ch. 149, Sec. 1, eff. Sept. 1, 1987.
Sec. 131.003. SPECIAL DEPOSITORY CONTRACT. (a) The contract
must require the payment of the deposit in installments as agreed
to by the parties. The last installment must be paid not later
than three years from the date of the contract.
(b) The parties may contract for the installments or the amount
due to be evidenced by negotiable certificates of deposit or
cashier's checks, payable at specified dates.
(c) The contract must set the rate of interest applicable to the
funds placed in the special depository under this subchapter
unless the parties agree that the funds are not to bear interest.
Acts 1987, 70th Leg., ch. 149, Sec. 1, eff. Sept. 1, 1987.
Sec. 131.004. BOND. (a) To secure the performance of a special
depository contract, the special depository shall execute a bond,
or bonds in the case of installments, with the same character of
sureties required for regular depository bonds.
(b) The local government authority authorized by law to approve
a bond of a regularly selected depository must approve a bond of
a special depository.
Acts 1987, 70th Leg., ch. 149, Sec. 1, eff. Sept. 1, 1987.
Sec. 131.005. STATE FUNDS. (a) The comptroller shall determine
the amount of state funds held by a county depository that
suspends business or is taken charge of by a state or federal
bank regulatory agency. The comptroller may:
(1) contract with a special depository selected by the county
authorities as provided by this subchapter for the custody and
payment of those funds; and
(2) approve a bond for the deposit contract.
(b) State funds placed in a special depository as provided by
Subsection (a) shall bear the average rate of interest received
by the state on state funds placed with regularly selected state
depositories.
(c) The comptroller may proceed with available legal remedies
against a suspended bank that is a depository for state funds if
the comptroller considers that action to be in the best interest
of the public.
Added by Acts 1993, 73rd Leg., ch. 268, Sec. 35, eff. Sept. 1,
1993. Amended by Acts 1999, 76th Leg., ch. 344, Sec. 5.011, eff.
Sept. 1, 1999.
SUBCHAPTER Z. MISCELLANEOUS PROVISIONS
Sec. 131.901. OUT-OF-STATE DEPOSITORY PROHIBITED. (a) The
governing body of a political subdivision, including a county,
municipality, school district, or other district, may not
designate a financial institution located outside the state as a
depository for funds under the governing body's jurisdiction. An
out-of-state financial institution is not considered to be
located outside this state to the extent the governing body
designates a branch office of such institution that is located in
this state.
(b) An institution selected as a paying agent or trustee for
specific bonds or obligations or an institution selected by the
governing body to provide safekeeping services is not considered
a depository for purposes of this section.
Acts 1987, 70th Leg., ch. 149, Sec. 1, eff. Sept. 1, 1987.
Amended by Acts 1993, 73rd Leg., ch. 234, Sec. 3, eff. Sept. 1,
1993; Acts 1999, 76th Leg., ch. 344, Sec. 5.012, eff. Sept. 1,
1999.
Sec. 131.902. PURSUIT OF LEGAL REMEDIES AGAINST SUSPENDED BANK.
A county, municipality, or district authority may proceed with
available legal remedies against a suspended bank that is a
depository for public funds of the authority if the authority
considers that action to be in the best interest of the public.
Acts 1987, 70th Leg., ch. 149, Sec. 1, eff. Sept. 1, 1987.
Sec. 131.903. CONFLICT OF INTEREST. (a) A bank is not
disqualified from serving as a depository for funds of a
political subdivision if:
(1) an officer or employee of the political subdivision who does
not have the duty to select the political subdivision's
depository is an officer, director, or shareholder of the bank;
or
(2) one or more officers or employees of the political
subdivision who have the duty to select the political
subdivision's depository are officers or directors of the bank or
own or have a beneficial interest, individually or collectively,
in 10 percent or less of the outstanding capital stock of the
bank, if:
(A) a majority of the members of the board, commission, or other
body of the political subdivision vote to select the bank as a
depository; and
(B) the interested officer or employee does not vote or take
part in the proceedings.
(b) This section may not be construed as changing or superseding
a conflicting provision in the charter of a home-rule
municipality.
Added by Acts 1993, 73rd Leg., ch. 268, Sec. 36, eff. Sept. 1,
1993.
State Codes and Statutes
Statutes >
Texas >
Local-government-code >
Title-4-finances >
Chapter-131-depository-provisions-affecting-funds-of-municipalities-counties-and-other-local-governm LOCAL GOVERNMENT CODE
TITLE 4. FINANCES
SUBTITLE C. FINANCIAL PROVISIONS APPLYING TO MORE THAN ONE TYPE
OF LOCAL GOVERNMENT
CHAPTER 131. DEPOSITORY PROVISIONS AFFECTING FUNDS OF
MUNICIPALITIES, COUNTIES, AND OTHER LOCAL GOVERNMENTS
SUBCHAPTER A. SPECIAL DEPOSITORY
Sec. 131.001. SPECIAL DEPOSITORY AUTHORIZED. If a financial
institution that is a depository under state law for the public
funds of a county, municipality, or district suspends business or
is taken charge of by a state or federal bank regulatory agency,
the local government authority authorized to select the original
depository may select by contract a special depository for the
public funds in the suspended financial institution.
Acts 1987, 70th Leg., ch. 149, Sec. 1, eff. Sept. 1, 1987.
Amended by Acts 1999, 76th Leg., ch. 344, Sec. 5.010, eff. Sept.
1, 1999.
Sec. 131.002. DUTIES OF SPECIAL DEPOSITORY. The special
depository shall assume the payment of the amount of public funds
due by the suspended bank on the date of its suspension,
including interest to that date, and shall pay that amount to the
designated local government authority in accordance with the
contract entered into by the special depository.
Acts 1987, 70th Leg., ch. 149, Sec. 1, eff. Sept. 1, 1987.
Sec. 131.003. SPECIAL DEPOSITORY CONTRACT. (a) The contract
must require the payment of the deposit in installments as agreed
to by the parties. The last installment must be paid not later
than three years from the date of the contract.
(b) The parties may contract for the installments or the amount
due to be evidenced by negotiable certificates of deposit or
cashier's checks, payable at specified dates.
(c) The contract must set the rate of interest applicable to the
funds placed in the special depository under this subchapter
unless the parties agree that the funds are not to bear interest.
Acts 1987, 70th Leg., ch. 149, Sec. 1, eff. Sept. 1, 1987.
Sec. 131.004. BOND. (a) To secure the performance of a special
depository contract, the special depository shall execute a bond,
or bonds in the case of installments, with the same character of
sureties required for regular depository bonds.
(b) The local government authority authorized by law to approve
a bond of a regularly selected depository must approve a bond of
a special depository.
Acts 1987, 70th Leg., ch. 149, Sec. 1, eff. Sept. 1, 1987.
Sec. 131.005. STATE FUNDS. (a) The comptroller shall determine
the amount of state funds held by a county depository that
suspends business or is taken charge of by a state or federal
bank regulatory agency. The comptroller may:
(1) contract with a special depository selected by the county
authorities as provided by this subchapter for the custody and
payment of those funds; and
(2) approve a bond for the deposit contract.
(b) State funds placed in a special depository as provided by
Subsection (a) shall bear the average rate of interest received
by the state on state funds placed with regularly selected state
depositories.
(c) The comptroller may proceed with available legal remedies
against a suspended bank that is a depository for state funds if
the comptroller considers that action to be in the best interest
of the public.
Added by Acts 1993, 73rd Leg., ch. 268, Sec. 35, eff. Sept. 1,
1993. Amended by Acts 1999, 76th Leg., ch. 344, Sec. 5.011, eff.
Sept. 1, 1999.
SUBCHAPTER Z. MISCELLANEOUS PROVISIONS
Sec. 131.901. OUT-OF-STATE DEPOSITORY PROHIBITED. (a) The
governing body of a political subdivision, including a county,
municipality, school district, or other district, may not
designate a financial institution located outside the state as a
depository for funds under the governing body's jurisdiction. An
out-of-state financial institution is not considered to be
located outside this state to the extent the governing body
designates a branch office of such institution that is located in
this state.
(b) An institution selected as a paying agent or trustee for
specific bonds or obligations or an institution selected by the
governing body to provide safekeeping services is not considered
a depository for purposes of this section.
Acts 1987, 70th Leg., ch. 149, Sec. 1, eff. Sept. 1, 1987.
Amended by Acts 1993, 73rd Leg., ch. 234, Sec. 3, eff. Sept. 1,
1993; Acts 1999, 76th Leg., ch. 344, Sec. 5.012, eff. Sept. 1,
1999.
Sec. 131.902. PURSUIT OF LEGAL REMEDIES AGAINST SUSPENDED BANK.
A county, municipality, or district authority may proceed with
available legal remedies against a suspended bank that is a
depository for public funds of the authority if the authority
considers that action to be in the best interest of the public.
Acts 1987, 70th Leg., ch. 149, Sec. 1, eff. Sept. 1, 1987.
Sec. 131.903. CONFLICT OF INTEREST. (a) A bank is not
disqualified from serving as a depository for funds of a
political subdivision if:
(1) an officer or employee of the political subdivision who does
not have the duty to select the political subdivision's
depository is an officer, director, or shareholder of the bank;
or
(2) one or more officers or employees of the political
subdivision who have the duty to select the political
subdivision's depository are officers or directors of the bank or
own or have a beneficial interest, individually or collectively,
in 10 percent or less of the outstanding capital stock of the
bank, if:
(A) a majority of the members of the board, commission, or other
body of the political subdivision vote to select the bank as a
depository; and
(B) the interested officer or employee does not vote or take
part in the proceedings.
(b) This section may not be construed as changing or superseding
a conflicting provision in the charter of a home-rule
municipality.
Added by Acts 1993, 73rd Leg., ch. 268, Sec. 36, eff. Sept. 1,
1993.
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