(a) A fully collateralized repurchase agreement is an authorized investment under this subchapter if the repurchase agreement:
(1) has a defined termination date;
(2) is secured by a combination of cash and obligations described by § 2256.009(a)(1) or 2256.013 or, if applicable, § 2256.0204;
(3) requires the securities being purchased by the entity or cash held by the entity to be pledged to the entity either directly or through a joint account approved by the entity, held in the entity’s name either directly or through a joint account approved by the entity, and deposited at the time the investment is made with the entity or with a third party selected and approved by the entity; and
(4) is placed through a primary government securities dealer, as defined by the Federal Reserve, or a financial institution doing business in this state.
(a-1) A repurchase agreement made by an investing entity under this section may be submitted for clearing and settlement to a covered clearing agency, as defined by the Securities and Exchange Commission in Rule 17Ad-22 (17 C.F.R. § 240.17Ad-22).

(b) In this section:
(1) “Joint account” means an account maintained by a custodian bank and established on behalf of two or more parties to engage in aggregate repurchase agreement transactions.
(2) “Repurchase agreement” means a simultaneous agreement to buy, hold for a specified time, and sell back at a future date obligations described by § 2256.009(a)(1) or 2256.013 or, if applicable, § 2256.0204, at a market value at the time the funds are disbursed of not less than the principal amount of the funds disbursed. The term includes a direct security repurchase agreement and a reverse security repurchase agreement.
(c) Notwithstanding any other law, the term of any reverse security repurchase agreement may not exceed 90 days after the date the reverse security repurchase agreement is delivered.
(d) Money received by an entity under the terms of a reverse security repurchase agreement shall be used to acquire additional authorized investments, but the term of the authorized investments acquired must mature not later than the expiration date stated in the reverse security repurchase agreement.
(e) § 1371.059(c) applies to the execution of a repurchase agreement by an investing entity.
(f) An investing entity that contracts with an investment management firm under § 2256.003(b) may authorize the firm to invest the entity’s public funds or other funds under the entity’s control in repurchase agreements as provided by this section using a joint account.
(g) An investment management firm responsible for managing a repurchase agreement transaction using a joint account on behalf of an investing entity as authorized under Subsection (f) must ensure that:
(1) accounting and control procedures are implemented to document the investing entity’s aggregate daily investment and pro rata share in the joint account;
(2) each party participating in the joint account retains the sole rights of ownership to the party’s pro rata share of assets invested in the joint account, including investment earnings on those assets; and
(3) policies and procedures are implemented to prevent a party participating in the joint account from using any part of a balance of the joint account that is credited to another party.