Introduction to Treasurys Cash Management Operations

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AGENDA

• Office of State Treasurer
• Overview
• SAFE
• ATF
• Unclaimed Property
• Treasury Website www.treasury.alabama.gov

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Overview

• Established 1819 Alabama Constitution
• Treasurer is elected by people
• Staff 48 employees
• Divisions
• Bonds
• Cash Management
• College Savings
• SAFE
• Unclaimed Property

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SAFE PROGRAM

• Security for Alabama Funds Enhancement SAFE
• Title 41, Chapter 14A, Code of Alabama
• i.e., Collateral pool to protect public deposits
  in Alabama banks
  
• Basic Description of Program

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Key Definitions

• Covered Public Entity means the various
  governmental units of the state, counties,
  municipalities, and other government entities or
  officials. Funds owned by a covered public
  entity are considered public funds.
• Public Deposits means monies of any covered
  public entity or covered public official
  deposited in a bank, such as demand deposit
  accounts, savings accounts, and certificates of
  deposit.
• Qualified Public Depository or QPD means any
  bank that has met all of the following
  requirements of the SAFE Program and has been
  designated by the Treasurer to receive and hold
  public deposits. By law, a bank must be a QPD in
  order to have public deposits. A QPD must
• be organized and existing in the USA
• be authorized to conduct the business of making
  loans and taking deposits in the State of
  Alabama
  
• have FDIC insurance
• execute necessary SAFE Program forms

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What is a Public Entity?

• the state and its political subdivisions,
  including its agencies, departments, boards,
  commissions, officers, public institutions of
  higher learning as defined in Section 16-5-1, and
  courts
• counties, including the offices of their public
  officials, whether elected or appointed, and any
  of their agencies, departments, boards, school
  districts, commissions, and courts
• municipalities, and any of their agencies,
  departments, boards, school districts,
  commissions, and courts
  
• public corporations, including any public board,
  authority, or district, heretofore or hereafter
  organized or created in this state pursuant to
  authorization or determination of any
  municipality or municipalities or by any county
  or counties or the governing body of any one or
  more thereof and that receive any appropriations
  of funds by action of the Legislature of this
  state or any governing body of any political
  subdivision, municipality, or county of this
  state or that receive proceeds of any tax levied
  pursuant to any statute of this state
• any improvement authority incorporated under
  Chapter 7 of Title 39
  
• any public corporation or instrumentality created
  under the statutes of this state enacted prior to
  January 1, 2001, that expressly provide that
  depositories of funds of such public corporation
  or instrumentality shall pledge collateral to
  secure that public corporation's or
  instrumentality's deposits
• and any other public corporation created under
  statutes of this state enacted on or after
  January, 1, 2001, that provide that the public
  corporation shall be subject to the provisions of
  this chapter."

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Responsibilities of Public DepositorSAFE Rules
892-X-1-.09

• Deposit monies in QPD
• Declare monies are public deposits
• Verify account info received from bank as of
  9/30
  
• Contact bank if no statement received or info is
  incorrect
  
• If bank defaults, submit claim form to SAFE

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Certificate of Qualified Public Depository

• I hereby certify that
• AnyTown National Bank
• has fulfilled the necessary requirements and is
  designated a qualified public depository
  
• under the Security for Alabama Funds Enhancement
  Act (SAFE), as prescribed in
  
• Section 41-14A of the Code of Alabama 1975, as
  amended. Upon this designation, said
  
• financial institution is hereby qualified to
  receive and hold public funds.
  
• Given under my hand and seal this 21st day of
  July, 2005.
  
• _______________________
• Kay Ivey
• State Treasurer
• Chairman, SAFE Board of Directors

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Alabama Trust Fund

• Created in 1985, Amendment 450
• Royalties received from the production of
  natural gas reserves in Mobile Bay
  
• Irrevocable, permanent trust fund
• 3 billion
• Numerous amendments since creation

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ATF Distributions to Cities/Counties

• Income
• 10 to Cities
• 10 to Counties
• April 15
• Amount based on flat amount plus population
• FY 07 - 11.1 million distributed to cities
• - 11.1 million distributed to
  counties
  
• Last 5 years average 10.78 million/year/per

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Distributions

• Royalties
• 7 to County Municipal Government Improvement
  Trust Fund annually
  
• FY 07 25.9 million
• Balance in Trust Fund 186.1 million
• Income distributed in April
• FY 07 2.89 million to cities
• 2.89 million to counties
• No provision for distribution of principal

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Distributions

• ETF Rainy Day Account
• City/County Trust Fund receives 25 of the amount
  of the withdrawal
  
• No repayment to ATF of the 25
• Result to cities/counties increased principal,
  increased interest income
  

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QUESTIONS ???
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Unclaimed Property

• Is unclaimed property (more than one may apply)
• A. Land
• B. Safe deposit box items
• C. Money