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F I S C A L I M P A C T R E P O R T

SPONSOR Moore

ORIGINAL DATE

LAST UPDATED

1/24/07

1/31/07 HB 194/a HHGAC

SHORT TITLE Municipality Deposits of Public Money

SB

ANALYST Propst

APPROPRIATION (dollars in thousands)

Appropriation

Recurring

or Non-Rec

Fund

Affected

FY07

FY08

NFI

(Parenthesis ( ) Indicate Expenditure Decreases)

SOURCES OF INFORMATION

LFC Files

Responses Received From

Department of Finance and Administration (DFA)

SUMMARY

Synopsis of HHGAC Amendment

The amendment to the original bill retains the five working day requirement for deposits, except

in cases where inclement weather or natural disaster conditions exist. In cases where inclement

weather or natural disaster conditions exist, a municipality would have up to 10 days to make the

deposit.

Synopsis of Original Bill

The bill increases the time within which certain municipalities may deposit receipt of public

money. Municipalities or villages not having suitable banking facilities within their boundaries

in which to deposit collected receipts of public money currently must deposit those funds within

a period not to exceed five working days. The bill extends the period to 10 days from the date of

receipt if inclement weather or natural disaster conditions exist. Otherwise the period remains

the same, five working days.

House Bill 194/aHHGAC – Page

2

SIGNIFICANT ISSUES

Remote municipalities and villages without suitable banking facilities generally do not gather

large deposits during a five day work week. The extended time to make small deposits, in cases

of inclement weather or natural disaster, would reduce the expense of time and money currently

expensed to make deposits within the current five day work week.

OTHER SUBSTANTIVE ISSUES

In its analysis on the original bill, DFA noted that, when a municipality or village does collect a

large public deposit, which is to be defined by rule, it should be made in a timely manner not to

exceed five working days.

Additionally, accessibility to electronic communications technology exists in most remote

municipalities and villages. If accessibility exists, public entities should make every effort to use

this form of communication to make timely deposits with a financial institution within its

boundaries that have the technology to accept electronic deposits. In this case the five day work

week should also apply.

Finally, a municipality or village should obtain safekeeping furniture, fixtures and equipment to

secure the cash if given the additional time to make deposits.

The sponsor proposed an amendment to the original bill retaining the five working day

requirement for deposits, except in cases where inclement weather or natural disaster conditions

exist. In cases where inclement weather or natural disaster conditions exist, a municipality

would have up to 10 days to make the deposit.

WHAT WILL BE THE CONSEQUENCES OF NOT ENACTING THIS BILL

There would be no exception for inclement weather or natural disasters to the current five day

rule for deposits would remain in effect.

WEP/mt:nt