HOUSE BILL 542

47th legislature - STATE OF NEW MEXICO - second session, 2006

INTRODUCED BY

W. Ken Martinez

AN ACT

RELATING TO PUBLIC MONEY; CREATING AN IN-HOUSE FINANCIAL ADVISOR IN THE OFFICE OF THE STATE TREASURER; PROVIDING POWERS AND DUTIES; MAKING AN APPROPRIATION.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:

     Section 1. A new section of Chapter 8, Article 6 is enacted to read:

     "[NEW MATERIAL] STATE TREASURER INVESTMENTS--FINANCIAL ADVISOR--QUALIFICATIONS--POWERS AND DUTIES.--

          A. The state treasurer shall appoint a financial advisor who shall manage and oversee investments made by the office of the state treasurer.

          B. The financial advisor shall have at least five years of professional experience as a financial advisor to persons other than families or individuals.

          C. Subject to the limitations, conditions or rules of the office of the state treasurer and subject to prior authorization by the state treasurer, the financial advisor may, pursuant to laws regulating investments of the office of the state treasurer, invest the assets of funds administered under the supervision of the state treasurer. The financial advisor shall see that money invested is at all times handled in the best interests of the state.

          D. Pursuant to laws regulating investments of the office of the state treasurer, the financial advisor shall formulate and recommend to the state treasurer for approval investment rules pertaining to the kind or nature of investments made and limitations, conditions and restrictions upon the methods and practices or procedures used for investment that should govern the activities of the office of the state treasurer.

          E. The financial advisor may hire an investment management firm to advise the office of the state treasurer with respect to the overall investment plan for the investment of funds managed by the office of the state treasurer and pay reasonable compensation for such advisory services, subject to appropriation by the legislature. The terms of any such investment management services contract shall incorporate the statutory requirements for investment of funds under the state treasurer's jurisdiction.

          F. The financial advisor shall provide quarterly performance reports to the legislative finance committee. Annually, the financial advisor shall provide written investment rules that have been approved by the state treasurer, including any amendments, to the legislative finance committee."

     Section 2. APPROPRIATION.--Two hundred fifty thousand dollars ($250,000) is appropriated from the general fund to the office of the state treasurer for expenditure in fiscal year 2007 to implement the provisions of Section 1 of this act. Any unexpended or unencumbered balance remaining at the end of fiscal year 2007 shall revert to the general fund.

- 3 -