As used in this chapter, "INVESTMENT OBLIGATIONS" shall mean any of the following, if and to the extent the following are legal investments for the moneys held in the Bond Fund established pursuant to this chapter:
(A) Obligations of the United States and of its agencies and instrumentalities, including obligations subject to repurchase agreements, if delivery of these obligations subject to repurchase agreements is taken either directly or through an authorized custodian, which investments may be accomplished through repurchase agreements reached with sources including, but not limited to, national or state banks chartered in Kentucky;
(B) Obligations and contracts for future delivery or purchase of obligations backed by the full faith and credit of the United States or a United States government agency, including but not limited to:
(1) United States Treasury;
(2) Export-Import Bank of the United States;
(3) Government National Mortgage Corporation; and
(4) Merchant Marine;
(C) Obligations of any corporation of the United States government, including but not limited to:
(1) Federal Home Loan Mortgage Corporation;
(2) Federal Farm Credit Banks;
(3) Bank for Cooperatives;
(4) Federal Intermediate Credit Banks;
(5) Federal Land Banks;
(6) Federal Home Loan Banks;
(7) Federal National Mortgage Association; and
(8) Tennessee Valley Authority;
(D) Certificates of deposit issued by or other interest bearing accounts of any bank or savings and loan institution, including the paying agent and bond registrar or any of its affiliates, which are insured by the Federal Deposit Insurance Corporation or similar entity or which are collateralized, to the extent uninsured, by any obligations, including surety bonds, permitted by KRS 41.240(4);
(E) Uncollateralized certificates of deposit, time deposits, trust accounts, trust deposits and demand deposits, including interest bearing money market accounts, of any bank or savings and loan institution, including any paying agent and bond registrar of any Bonds or any of its affiliates, rated in one of the three highest categories by a nationally recognized rating agency;
(F) Bankers’ acceptances for banks, including any paying agent and bond registrar of any bonds or any of its affiliates, rated in one of the three highest categories by a nationally recognized rating agency;
(G) Commercial paper rated in the highest category by a nationally recognized rating agency, including commercial paper issued by any paying agent and bond registrar of any bonds or any of its affiliates, if so rated;
(H) Bonds or certificates of indebtedness of the Commonwealth of Kentucky and of its agencies and instrumentalities;
(I) Securities issued by a state or local government, or any instrumentality or agency thereof, in the United States, and rated in one of the three highest categories by a nationally recognized rating agency; and
(J) Shares of mutual funds, each of which shall have the following characteristics:
(1) The mutual fund shall be an open-end diversified investment company registered under the Federal Investment Company Act of 1940, as amended;
(2) The management company of the investment company shall have been in operation for at least five years;
(3) All of the securities in the mutual fund shall be investments in any one or more of the investments described in divisions(A) through (I) above; and
(4) The mutual funds may include, without limitation, any mutual fund for which any paying agent and bond registrar of any bonds or any of its affiliates, serves as investment manager, administrator, shareholder servicing agent, and/or custodian or subcustodian, notwithstanding that:
(a) Any paying agent and bond registrar of any bonds or any of its affiliates, receives fees from such funds for services rendered;
(b) Any paying agent and bond registrar of any bonds or any of its affiliates, charges and collects fees for services rendered pursuant to this chapter, which fees are separate from the fees received from such funds; and
(c) Services performed for such funds and pursuant to this chapter may at times duplicate those provided to such funds by any paying agent and bond registrar of any bonds or any of its affiliates.
(Ord. B2010-09, passed 6-15-10)