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S06464 Summary:

S06464 Text:

 
                STATE OF NEW YORK
        ________________________________________________________________________
 
                                          6464
 
                               2019-2020 Regular Sessions
 
                    IN SENATE
 
                                      June 12, 2019
                                       ___________
 
        Introduced  by Sen. STAVISKY -- (at request of the State Comptroller) --
          read twice and ordered printed, and when printed to  be  committed  to
          the Committee on Rules
 
        AN  ACT  to  amend  the state finance law, in relation to the investment
          standard for investments of the New York state college choice  tuition
          savings  program  and  the New York achieving a better life experience
          (ABLE) savings account program
 
          The People of the State of New York, represented in Senate and  Assem-
        bly, do enact as follows:
 
     1    Section  1.  Paragraph (a) of subdivision 3 of section 78 of the state
     2  finance law, as amended by chapter 328 of the laws of 2003,  is  amended
     3  to read as follows:
     4    (a)  The comptroller, as trustee, shall invest the assets of the trust
     5  fund [in investments authorized by article four-A of the retirement  and
     6  social security law, provided however, that:
     7    (i)  the provisions of paragraph (a) of subdivision two of section one
     8  hundred seventy-seven of the retirement and social  security  law  shall
     9  not apply except for the first clause of subparagraph (ii) of such para-
    10  graph; and
    11    (ii)  notwithstanding  the  provisions of subdivision seven of section
    12  one hundred seventy-seven of the retirement and social security  law  or
    13  any  other  law  to  the  contrary,  the assets of the trust fund may be
    14  invested in any funding agreement  issued  in  accordance  with  section
    15  three thousand two hundred twenty-two of the insurance law by a domestic
    16  life  insurance  company or a foreign life insurance company doing busi-
    17  ness in this state, subject to the following:
    18    (1) such a funding agreement may provide for a guaranteed minimum rate
    19  of return;
    20    (2) such a funding agreement may be allocated  as  either  a  separate
    21  account  or  a  general  account  of  the issuer, as the comptroller may
    22  decide;

         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD09007-02-9
        S. 6464                             2

     1    (3) total investments of the trust fund pursuant to this paragraph  in
     2  any  funding  agreements issued by a single life insurance company which
     3  are allocated as a general account of  the  issuer  shall  not,  in  the
     4  aggregate, exceed three hundred fifty million dollars; and
     5    (4)  no assets of the trust fund shall be invested in any such funding
     6  agreement unless, at the time of  such  investment,  the  general  obli-
     7  gations  or  financial  strength  of the issuer have received either the
     8  highest or second highest rating by  two  nationally  recognized  rating
     9  services  or  by  one  nationally recognized rating service in the event
    10  that only one such service rates such obligations] with the care, skill,
    11  prudence and diligence under the circumstances then  prevailing  that  a
    12  prudent  person acting in a like capacity and familiar with such matters
    13  would use in the conduct of an enterprise of a like character  and  with
    14  like aims.
    15    §  2.  Paragraph  (a)  of  subdivision  3 of section 99-x of the state
    16  finance law, as added by chapter 576 of the laws of 2015, is amended  to
    17  read as follows:
    18    (a)  The comptroller, as trustee, shall invest the assets of the trust
    19  fund [in investments authorized by article four-A of the retirement  and
    20  social security law, provided however, that: (i) the provisions of para-
    21  graph (a) of subdivision two of section one hundred seventy-seven of the
    22  retirement  and social security law shall not apply except for the first
    23  clause of subparagraph (ii) of such paragraph; and (ii)  notwithstanding
    24  the provisions of subdivision seven of section one hundred seventy-seven
    25  of  the  retirement  and  social  security  law  or any other law to the
    26  contrary, the assets of the trust fund may be invested  in  any  funding
    27  agreement  issued  in accordance with section three thousand two hundred
    28  twenty-two of the insurance law by a domestic life insurance company  or
    29  a  foreign  life insurance company doing business in this state, subject
    30  to the following: (1) such a funding agreement may provide for a guaran-
    31  teed minimum rate of return; (2) such a funding agreement may  be  allo-
    32  cated  as  either a separate account or a general account of the issuer,
    33  as the comptroller may decide; (3) total investments of the  trust  fund
    34  pursuant  to this paragraph in any funding agreements issued by a single
    35  life insurance company which are allocated as a general account  of  the
    36  issuer  shall  not, in the aggregate, exceed three hundred fifty million
    37  dollars; and (4) no assets of the trust fund shall be  invested  in  any
    38  such  funding  agreement  unless,  at  the  time of such investment, the
    39  general obligations or financial strength of the  issuer  have  received
    40  either the highest or second highest rating by two nationally recognized
    41  rating  services  or  by one nationally recognized rating service in the
    42  event that only one such service rates such obligations] with the  care,
    43  skill,  prudence  and  diligence under the circumstances then prevailing
    44  that a prudent person acting in a like capacity and familiar  with  such
    45  matters  would  use  in the conduct of an enterprise of a like character
    46  and with like aims.
    47    § 3. This act shall take effect immediately.