PRINTER'S NO. 2538
No. 1930 Session of 1984
INTRODUCED BY MANDERINO, PIEVSKY, RIEGER, O'DONNELL, GALLAGHER,
F. E. TAYLOR, PRATT, BURD, DORR, J. L. WRIGHT, SERAFINI,
ARTY, DOMBROWSKI, SWEET, HUTCHINSON AND FEE, FEBRUARY 14,
1984
REFERRED TO COMMITTEE ON APPROPRIATIONS, FEBRUARY 14, 1984
AN ACT
1 Amending the act of April 9, 1929 (P.L.343, No.176), entitled
2 "An act relating to the finances of the State government;
3 providing for the settlement, assessment, collection, and
4 lien of taxes, bonus, and all other accounts due the
5 Commonwealth, the collection and recovery of fees and other
6 money or property due or belonging to the Commonwealth, or
7 any agency thereof, including escheated property and the
8 proceeds of its sale, the custody and disbursement or other
9 disposition of funds and securities belonging to or in the
10 possession of the Commonwealth, and the settlement of claims
11 against the Commonwealth, the resettlement of accounts and
12 appeals to the courts, refunds of moneys erroneously paid to
13 the Commonwealth, auditing the accounts of the Commonwealth
14 and all agencies thereof, of all public officers collecting
15 moneys payable to the Commonwealth, or any agency thereof,
16 and all receipts of appropriations from the Commonwealth and
17 imposing penalties; affecting every department, board,
18 commission, and officer of the State government, every
19 political subdivision of the State, and certain officers of
20 such subdivisions, every person, association, and corporation
21 required to pay, assess, or collect taxes, or to make returns
22 or reports under the laws imposing taxes for State purposes,
23 or to pay license fees or other moneys to the Commonwealth,
24 or any agency thereof, every State depository and every
25 debtor or creditor of the Commonwealth," further providing
26 for security from State depositions.
27 The General Assembly of the Commonwealth of Pennsylvania
28 hereby enacts as follows:
29 Section 1. Section 505(a) of the act of April 9, 1929
1 (P.L.343, No.176), known as The Fiscal Code, amended June 28,
2 1951 (P.L.601, No.152), December 14, 1967 (P.L.810, No.347), and
3 July 11, 1980 (P.L.554, No.115), is amended to read:
4 Section 505. State Depositories.--The Board of Finance and
5 Revenue shall have the power, and its duty shall be,
6 (a) To select and designate, as depositories for the State
7 moneys, banks, banking institutions, trust companies or savings
8 and loan associations, which are subject to national or State
9 supervision, and the accounts of which are insured by a
10 corporation organized under the Laws of the Commonwealth, or by
11 an instrumentality of the Federal Government, and each of which,
12 1. Has made written application to the State Treasurer for a
13 deposit of State moneys, designating the amount of deposit
14 solicited, and accompanying its application by a written
15 statement showing the amount of its capital actually paid in,
16 the amount of its surplus, the number of its stockholders, and
17 whether its stock is well distributed or largely held by a few
18 individuals, and the length of time that said institution has
19 been engaged in business under its charter. Each such statement
20 shall be verified by the oath or affirmation of the president,
21 cashier, or trust officer, as the case may be, and the State
22 Treasurer shall present the same to the board for its
23 consideration within thirty days after the receipt thereof.
24 2. Shall, upon the receipt of notice of its selection as a
25 depository of State moneys, furnish a bond to secure payment of
26 deposits and interests to the Commonwealth of Pennsylvania, with
27 a proper warrant of attorney to confess judgment in favor of the
28 Commonwealth, secured by a surety company or individual sureties
29 to be approved by the board, in the amount of the deposit to be
30 made. If a corporate bond be given, no one surety company shall
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1 be approved in an aggregate amount in excess of five times its
2 capital surplus, and reserve, and, whenever individual sureties
3 are presented for approval, they shall qualify in an aggregate
4 over and above their individual liabilities to three times the
5 amount of the deposit. No one person may qualify for more than
6 one-fourth of the total amount of the bond required: Provided,
7 That when any deposit of State moneys is insured with the
8 Federal Deposit Insurance Commissioner or any other corporation
9 hereafter organized by the United States for the purpose of
10 insuring deposits, such depository shall not be required to
11 furnish bond or security to cover the amount of such deposit so
12 insured: And provided further, That, in lieu of the surety bonds
13 of surety companies or of individuals as aforesaid, the deposit
14 of State moneys may be secured by the deposit with the State
15 Treasurer, with the Federal Reserve Bank of Philadelphia or
16 Pittsburgh, or with any bank or bank and trust company organized
17 under the laws of this Commonwealth or any national association
18 located in this Commonwealth which shall be approved by the
19 State Treasurer, subject to such regulations as may be
20 prescribed by the Board of Finance and Revenue or the State
21 Treasurer, or both, as the case may be, of bonds or notes of the
22 United States, or bonds or notes which the United States fully
23 guarantees both as to principal and interest, bonds of the
24 Delaware River Joint Commissions, bonds of the Pennsylvania
25 Turnpike Commission, bonds of the State Public School Building
26 Authority, bonds of The General State Authority, bonds of the
27 State Highway and Bridge Authority, bonds of the Pennsylvania
28 Housing Agency, bonds or tax anticipation notes of this
29 Commonwealth, or of any municipal subdivision, institution
30 district, or school district or county thereof, to be approved
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1 by the board, investments in a private placement separate
2 account established by the Milrite Council or investments in
3 venture capital funds created to enhance economic development in
4 Pennsylvania or investments in a small business investment
5 corporation or investments in a venture capital subsidiary of a
6 bank in an amount measured by their actual market value equal to
7 the amount of deposit so secured [and twenty per centum in
8 addition thereto]. A minimum of twenty-five per centum of such
9 posted security must be investments in a private placement
10 separate account established by the Milrite Council or
11 investments in venture capital funds created to enhance economic
12 development in Pennsylvania or investments in a small business
13 investment corporation or investments in a venture capital
14 subsidiary of a bank. Said bonds and any additions to and
15 substitutions and exchanges therefor shall be subject to proper
16 assignment, or right to sell, or power of attorney to transfer
17 the same, and said trust deposit of securities shall be
18 maintained, on request, at the amount aforesaid, in case of any
19 depreciation in the value thereof: Provided, That no bonds, or
20 other security, shall be required of State depositories for
21 State deposits to the extent, that such State deposits are
22 insured under the provisions of Section 12 B of the Federal
23 Reserve Act, approved the twenty-third day of December, one
24 thousand nine hundred and thirteen, its amendments and
25 supplements.
26 3. Shall agree to pay interest upon all State deposits, at
27 the rate to be fixed every six months by the Board of Finance
28 and Revenue, having due regard to the then prevailing money
29 market: Provided, That such agreement is not in conflict with
30 law or any regulation of the Comptroller of the Currency, or of
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1 the Federal Reserve Board of the United States. The said board
2 may fix different rates of interest for active and inactive
3 depositories, not in conflict with law or any regulation of the
4 Comptroller of the Currency, or of the Federal Reserve Board of
5 the United States, and may adopt and promulgate rules governing
6 the time when interest shall begin to run on deposits of
7 uncollected items. The board shall fix the specific day on which
8 any change in interest rate shall become effective, and shall
9 notify, in writing, every depository of such change and the
10 effective date thereof. Pending action by the board the interest
11 rates heretofore fixed by law shall remain in force. All
12 collections shall be made for the Commonwealth without cost or
13 compensation.
14 * * *
15 Section 2. This act shall take effect in 60 days.
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