SB 998

  • California Senate Bill
  • 2019-2020 Regular Session
  • Introduced in Senate Feb 13, 2020
  • Passed Senate Jun 11, 2020
  • Passed Assembly Aug 30, 2020
  • Signed by Governor Sep 28, 2020

Local government: investments.


Existing law, the Joint Exercise of Powers Act, generally authorizes 2 or more public agencies to agree to jointly exercise a common power. Existing law specifically authorizes 2 or more public agencies that have the authority to invest funds in their treasuries to agree to jointly exercise that common power and describes how funds subject to that agreement may be invested. This bill would authorize a joint powers authority formed as described above to establish the terms and conditions pursuant to which agencies may participate and invest in pool shares. The bill would specify that a federally recognized Indian tribe is eligible to participate in a joint powers authority formed for this purpose, consistent with its status as a public agency under the Joint Exercise of Powers Act, or to otherwise invest in pool shares consistent with the terms and conditions established by the joint powers authority. Existing law regulates the investment of public funds by local agencies, as defined. Existing law authorizes the legislative body of a local agency, as specified, that has money in a sinking fund or in its treasury not required for immediate needs to invest the money as it deems wise or expedient in certain securities and financial instruments. In this regard, existing law authorizes investment in prime quality commercial paper issued by entities meeting certain criteria. Existing law prohibits local agencies, other than counties, from investing more than 25% of their moneys in eligible commercial paper and further prohibits these agencies from purchasing more than 10% of the outstanding commercial paper of any single issuer. Existing law authorizes local agencies, as specified, to invest in medium-term notes, which are defined as corporate and depository institution debt securities with a maximum remaining maturity of 5 years or less, issued by specified corporations or by depository institutions. This bill would prohibit a local agency, other than a county or a city and a county, from investing more than 10% of its total investment assets in the commercial paper and the medium-term notes of any single issuer. This bill, until January 1, 2026, for local agencies that have more than $100,000,000 of investment assets under management, would instead prohibit investing more than 40% of their moneys in eligible commercial paper. Existing law generally prohibits a local agency from investing any funds pursuant to specified authorizations in a security that could result in zero-interest accrual if held to maturity. This bill, until January 1, 2026, would create an exception to this prohibition by authorizing a local agency to invest in securities issued by, or backed by, the United States government that could result in zero- or negative-interest accrual if held to maturity, as specified.

Bill Sponsors (2)



Sep 28, 2020

California State Legislature

Chaptered by Secretary of State. Chapter 235, Statutes of 2020.

California State Legislature

Approved by the Governor.

Sep 10, 2020

California State Legislature

Enrolled and presented to the Governor at 3 p.m.

Aug 30, 2020


In Senate. Ordered to engrossing and enrolling.


Read third time. Passed. (Ayes 75. Noes 0. Page 5280.) Ordered to the Senate.

Aug 12, 2020


Read second time. Ordered to consent calendar.

Aug 11, 2020


From committee: Do pass. Ordered to consent calendar. (Ayes 8. Noes 0.) (August 11).


Coauthors revised.

Jun 18, 2020


Referred to Com. on L. GOV.

  • Referral-Committee
Com. on L. GOV.

Jun 11, 2020


Read third time. Passed. (Ayes 39. Noes 0. Page 3675.) Ordered to the Assembly.


In Assembly. Read first time. Held at Desk.

May 22, 2020


Read second time and amended. Ordered to third reading.

May 21, 2020


From committee: Do pass as amended. (Ayes 7. Noes 0. Page 3576.) (May 21).

May 15, 2020


Set for hearing May 21.

May 06, 2020


From committee with author's amendments. Read second time and amended. Re-referred to Com. on GOV. & F.

  • Reading-1
  • Reading-2
  • Amendment-Passage
  • Committee-Passage
  • Referral-Committee
Com. on GOV. & F.

Feb 27, 2020


Referred to Com. on GOV. & F.

  • Referral-Committee
Com. on GOV. & F.

Feb 14, 2020


From printer. May be acted upon on or after March 15.

Feb 13, 2020


Introduced. Read first time. To Com. on RLS. for assignment. To print.

Bill Text

Bill Text Versions Format
02/13/20 - Introduced PDF
05/06/20 - Amended Senate PDF
05/22/20 - Amended Senate PDF
09/04/20 - Enrolled PDF
09/28/20 - Chaptered PDF

Related Documents

Document Format
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