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Serlet, Mike <br />From: Susan Schneider [Susan.Schneider@state.co.us] <br />Sent: Thursday, July 02, 2009 10:31 AM <br />To: Serlet, Mike <br />Subject: Fwd: Re: Investment of Public Funds <br />»> Linda Shubow 5/12/2009 1:34 PM »> <br />I am notororiouly bad at deleting old e-mails. Every once in a while it comes in handy. <br />Hopefully, this is what you need. If not, give me a call, I'll be all afternoon. <br />Linda <br />»> Susan Schneider 1/16/2009 3:43 PM »> <br />Thanks a ton, Linda! <br />»> Linda Shubow 1/16/2009 3:27 PM »> <br />Susan, <br />CRS section 37-45-118(1) authorizes the district to invest or deposit surplus money not <br />required for immediate necessities in any legal investment or depository authorized in by <br />Part 6 of Article 75 of Title 24, which delineates legal investments for public funds. <br />Under CRS section 24-75-601.1(1), a public entity may invest in (I) any guaranteed investment <br />contract, guaranteed interest contract, annuity contract, or funding agreement, if the <br />issuing entity is rated in one of the two highest rating categories by two or more nationally <br />recognized securities rating agencies. <br />(III)(A) provides that contracts purchased under (I) above cannot have a maturity period <br />greater than of 3 years, except as permitted under (III)(B). <br />(III)(B) provides that contracts with a maturity period greater than 3 years can be <br />purchased only if purchased with the proceeds of the sale of securities (e.g. bonds) of a <br />public entity or proceeds of certificates participation (e.g. rights to payment) or other <br />securities evidencing rights in payments to be made by a public entity under a lease, lease- <br />purchase agreement or if purchased with revenues pledged for payment of any the foregoing. <br />The exception in (III)(B) does not apply to proceeds which are held in escrow or otherwise <br />for the purposes of refunding bonds or other obligations of a public entity. <br />If the Investment Agreement with MBIA is terminated, any subsequent investment by the <br />district will be subject to the limitations of CRS section 24-75-601.1(1). <br />If MBIA assigns the Investment Agreement to a qualified third party insurer, the third party <br />will assume the Agreement and stand in the shoes of MBIA. The original investment will <br />continue and a new investment (subject to 24-75-601.1(1)) will not be required. <br />If the Loan Agreement between CWCB and the district contains restrictions on the <br />assignability of the Investment Agreement, the prior consent of CWCB to the assignment may be <br />required. <br />Please let me know if any of the above is confusing or if you have any questions. <br />Linda <br />1 <br />