32 V.S.A. § 433 — Investments of State money

(a) Investments of State funds shall be made in:
(1) obligations of the United States, its agencies, and instrumentalities, which have
a liquid market with readily determinable market value;
(2) certificates of deposit and other evidences of deposit at banks, community development
credit unions as defined in 8 V.S.A. § 30101, and savings and loan associations approved by the Treasurer;
(3) bankers’ acceptances issued by domestic banks where the guaranteeing bank is rated
in the highest tier assigned to the investments by at least two nationally recognized
rating agencies;
(4) commercial paper rated in the highest tier by at least two nationally recognized rating
agencies;
(5) investment-grade obligations of state or local governments, instrumentalities, and
public authorities;
(6) repurchase agreements whose underlying purchased securities consist of any of the
investments specified in subdivisions (1) through (5) of this subsection;
(7) investment agreements or guaranteed investment contracts rated or guaranteed by a
financial institution whose senior long-term debt obligations are rated, at the time
such agreement or contract is entered into, in the highest tier assigned to such investments
by a nationally recognized rating agency, and where the Treasurer has the option to
terminate each agreement in the event such rating is downgraded below the highest
rating tier; and
(8) money market mutual funds that either are regulated by the Securities and Exchange
Commission and whose portfolios consist only of dollar-denominated securities or are
managed in a manner consistent with Rule 2a-7 of the Investment Company Act of 1940.
(b) Investments of State funds shall be made with judgment and care, under circumstances
then prevailing, which persons of prudence, discretion, and intelligence exercise
in the management of their own affairs, not for speculation but for investment, considering
the probable safety of their capital as well as the probable income to be derived.
(c) Investments of State funds shall be made in accordance with written guidelines adopted
by the Treasurer. Such guidelines shall address the liquidity, diversification, safety
of principal, yield, maturity, and quality and capability of investment management,
with primary emphasis on safety and liquidity. (Amended 1991, No. 238 (Adj. Sess.), § 1, eff. May 28, 1992; 2005, No. 46, § 1; 2009, No. 76 (Adj. Sess.), § 1, eff. April 13, 2010.)