Additional deposit placement services proposed

A bill designed to authorize state and local political subdivisions use of deposit placement services advanced to select file Feb. 1.

Boys Town Sen. Rich Pahls, sponsor of LB836, said current law allows state and local political subdivisions to invest in certificates of deposit and time deposits through the Certificate of Deposit Account Registry Service (CDARS) program or similar programs.

Under the bill, state and political subdivisions would be allowed to use additional programs to redeposit public funds invested in an interest-bearing money market deposit account at multiple insured institutions in amounts up to the FDIC deposit insurance coverage limit.

“The mechanism stays the same,” Pahls said. “We are only being asked to authorize an additional investment vehicle.”

Following adoption of a technical amendment offered by the Banking, Commerce and Insurance Committee, LB836 advanced to select file on a 31-0 vote.