California Government Code 53665 – If a depository fails to pay all or part of the deposits of a local …
If a depository fails to pay all or part of the deposits of a local agency secured by pooled securities in accordance with the contract provided for in Section 53649, and on demand of its treasurer or other authorized official and the treasurer files a report with the administrator, or if the depository fails:
(a) In case the pooled securities consist of securities other than securities of the class described in subdivision (p) of Section 53651, the administrator shall order the agent of depository holding the pooled securities to convert into money that portion of the pooled securities necessary to produce an amount equal to the sum of (i) the deposits of the local agency, (ii) any accrued interest due on the deposits, and (iii) the reasonable expenses of the agent of depository in complying with the order of the administrator and to pay the sum of items (i) and (ii) to the treasurer in satisfaction of the deposits. The agent of depository shall be reimbursed out of the proceeds of the conversion for its reasonable expenses in complying with the order of the administrator, as approved by the administrator. Any excess moneys resulting from the conversion shall be retained by the agent of depository as part of the securities pool until the depository substitutes for the excess moneys securities having a market value sufficient to bring the total of pooled securities up to the amount required by Section 53652.
Terms Used In California Government Code 53665
- Administrator: means the Administrator of Local Agency Security of the State of California. See California Government Code 53630
- Agent of depository: means a trust company or trust department of a state or national bank located in this state, including the trust department of a depository where authorized, and the Federal Home Loan Bank of San Francisco, which is authorized to act as an agent of depository for the purposes of this article pursuant to Section 53657. See California Government Code 53630
- Contract: A legal written agreement that becomes binding when signed.
- Depository: means a state or national bank, savings association or federal association, a state or federal credit union, or a federally insured industrial loan company, in this state in which the moneys of a local agency are deposited. See California Government Code 53630
- Local agency: means county, city, city and county, including a chartered city or county, a community college district, or other public agency or corporation in this state. See California Government Code 53630
- Pooled securities: means eligible securities held by an agent of depository for a depository and securing deposits of one or more local agencies. See California Government Code 53630
- Security: means any of the eligible securities or obligations listed in Section 53651. See California Government Code 53630
- Subdivision: means a subdivision of the section in which the term occurs unless some other section is expressly mentioned. See California Government Code 10
- Treasurer: means treasurer of the local agency. See California Government Code 53630
(b) In case the pooled securities consist of a security of the class described in subdivision (p) of Section 53651, the administrator shall draw on the letter of credit an amount equal to the sum of (i) the deposits of the local agency, (ii) any accrued interest on the deposits, and (iii) the reasonable expenses of the administrator in paying the deposits and pay the sum of items (i) and (ii) to the treasurer in satisfaction of the deposits.
(Amended by Stats. 1986, Ch. 1132, Sec. 30.)