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Page 30 of 37 <br />and have a stated final maturity that is not later than the third <br />anniversary of the date the corporate bonds were purchased. <br />(d) An independent school district subject to this section is <br />not authorized by this section to: <br />(1) invest in the aggregate more than 15 percent of its <br />monthly average fund balance, excluding bond proceeds, reserves, and <br />other funds held for the payment of debt service, in corporate bonds; <br />or <br />(2) invest more than 25 percent of the funds invested in <br />corporate bonds in any one domestic business entity, including <br />subsidiaries and affiliates of the entity. <br />(e) An independent school district subject to this section may <br />purchase, sell, and invest its funds and funds under its control in <br />corporate bonds if the governing body of the district: <br />(1) amends its investment policy to authorize corporate <br />bonds as an eligible investment; <br />(2) adopts procedures to provide for: <br />(A) monitoring rating changes in corporate bonds <br />acquired with public funds; and <br />(B) liquidating the investment in corporate bonds; and <br />(3) identifies the funds eligible to be invested in <br />corporate bonds. <br />(f) The investment officer of an independent school district, <br />acting on behalf of the district, shall sell corporate bonds in which <br />the district has invested its funds not later than the seventh day <br />after the date a nationally recognized investment rating firm: <br />(1) issues a release that places the corporate bonds or <br />the domestic business entity that issued the corporate bonds on <br />negative credit watch or the equivalent, if the corporate bonds are <br />rated "AA-" or the equivalent at the time the release is issued; or <br />(2) changes the rating on the corporate bonds to a rating <br />lower than "AA-" or the equivalent. <br />(g) Corporate bonds are not an eligible investment for a public <br />funds investment pool. <br />Added by Acts 2011, 82nd Leg., R.S., Ch. 1347 (S.B. 1543), Sec. 1, <br />eff. June 17, 2011. <br />4/18/2018 <br />