WSR 16-13-013 PROPOSED RULES OFFICE OF THE STATE TREASURER [Filed June 3, 2016, 8:16 a.m.]
Original Notice.
Preproposal statement of inquiry was filed as WSR 16-09-110.
Title of Rule and Other Identifying Information: Chapter 210-10 WAC, Operations of the local government investment pool (LGIP), this chapter is being amended to permit the contribution and withdrawal of funds into the LGIP by automated clearing house (ACH) as well as by wire, and to set parameters regarding ACH transactions.
Hearing Location(s): Office of the State Treasurer, 1110 Capitol Way South, Room 260, Olympia, WA 98504, on July 26, 2016, at 1:00 p.m.
Date of Intended Adoption: July 26, 2016.
Submit Written Comments to: Johnna Craig, 1110 Capitol Way South, P.O. Box 40200, Olympia, WA 98504, e-mail Johnna.Craig@tre.wa.gov, fax (360) 704-5181, by July 24, 2016.
Assistance for Persons with Disabilities: Contact Johnna S. Craig by July 25, 2016, TTY dial 711 for telecommunications relay services.
Purpose of the Proposal and Its Anticipated Effects, Including Any Changes in Existing Rules: The amendments to the existing rules will clarify that electronic funds transfer also includes the contribution and withdrawal of funds, by pool participants by ACH as well as by wire. This change will allow greater flexibility to users of the LGIP.
Reasons Supporting Proposal: The proposed amendment will allow for greater flexibility to users of the LGIP and will clarify a potential inconsistency in the current rules.
Statutory Authority for Adoption: RCW 43.250.060.
Statute Being Implemented: Chapter 43.250 RCW.
Rule is not necessitated by federal law, federal or state court decision.
Name of Proponent: Washington state treasurer, governmental.
Name of Agency Personnel Responsible for Drafting, Implementation, and Enforcement: Doug Extine, 416 Syd Snyder Avenue S.W., Legislative Building, Room 230, Olympia, WA 98504, (360) 902-9012.
No small business economic impact statement has been prepared under chapter 19.85 RCW. The proposed rules are "rules relating only to internal governmental operations that are not subject to violation by a nongovernmental entity" as stated in RCW 34.05.310 and therefore such requirement is not applicable to these proposed rules. Further, the rules are not being proposed by the state board of education as addressed in section 1, chapter 210, Laws of 2012.
A cost-benefit analysis is not required under RCW 34.05.328. The proposed rules are "rules relating only to internal governmental operations that are not subject to violation by a nongovernmental entity" as stated in RCW 34.05.328 (5)(b) and therefore such requirement is not applicable to these proposed rules.
June 3, 2016
Douglas D. Extine
Deputy Treasurer
AMENDATORY SECTION (Amending WSR 13-03-043, filed 1/9/13, effective 2/9/13)
WAC 210-10-050 Contribution procedures.
(1) Contribution procedures for the money market fund:
(a) All contributions will be effected by electronic funds transfer to an account in the money market fund designated by the state treasurer. It is the responsibility of each pool participant to pay any bank charges associated with such electronic transfers to the state treasurer.
(b) Funds transmitted by automated clearing house (ACH) will be held for a period of time as designated by the state treasurer in the prospectus.
(c) Failure to ((wire)) transmit funds by a pool participant after notification to the state treasurer of an intended transfer will result in penalties. Penalties for failure to timely ((wire)) transmit funds will be assessed to the account of the pool participant responsible. Reversal of an ACH transmission will constitute a failure to transmit funds.
(d) Contribution requests received in good order will receive the net asset value per unit of the money market fund next determined after the order is accepted by the state treasurer.
(2) Contribution procedures for the extended asset fund:
Direct investments into the extended asset fund are not permitted. Contributions to the extended asset fund may only be effected by means of a contribution from the money market fund. Contributions will take place monthly, on the 10th calendar day of the month (or on the next business day, if the 10th does not fall on a business day).
Pool participants must notify the state treasurer of any contribution on the business day prior to a permitted contribution date no later than the time on that day specified in the prospectus. The state treasurer may allow contributions with less than the required notice in its sole discretion.
Contributions to the extended asset fund will be effected by way of a corresponding withdrawal from the pool participant's specified money market fund account. On the contribution date, shares will be sold from the specified money market fund account at the net asset value determined as of the order acceptance date. Shares of the extended asset fund will be purchased using the extended asset fund's net asset value determined as of the order acceptance date.
AMENDATORY SECTION (Amending WSR 13-03-043, filed 1/9/13, effective 2/9/13)
WAC 210-10-060 Contribution limits and earnings credit.
(1) Contribution limits and earnings credit for the money market fund:
To ensure same day credit, a pool participant must inform the state treasurer of any contribution over one million dollars, except for funds transmitted by ACH, no later than 9 a.m. on the same day the contribution is made. Contributions for one million dollars or less, other than those funds transmitted by ACH, can be requested at any time prior to 10 a.m. on the day of contribution.
For all other contributions over one million dollars that are requested prior to 10 a.m., a pool participant may receive same day credit at the sole discretion of the state treasurer. Contributions that receive same day credit will count, for earning rate purposes, as of the day in which the contribution was made. Contributions for which no notice is received prior to 10 a.m. will be credited as of the following business day.
Participants transmitting a contribution via ACH must notify the state treasurer no later than 2 p.m. the business day prior to the contribution date.
(2) Earnings credit:
Income earnings credit on funds contributed to a subpool will be credited to each subpool in the timing and manner described in the prospectus.
AMENDATORY SECTION (Amending WSR 13-03-043, filed 1/9/13, effective 2/9/13)
WAC 210-10-070 Withdrawal procedures.
(1) Withdrawal procedures for the money market fund:
Each pool participant shall file with the state treasurer a letter designating the financial institution at which funds withdrawn from the money market fund shall be deposited. This letter shall contain the name of the financial institution, the location of the financial institution, the account name, and the account number to which funds will be deposited. This letter shall be signed by local officials authorized to receive and disburse funds, as described in WAC 210-10-020. Disbursements from the subpool will be effected by electronic funds transfer. Failure by the state treasurer to ((wire)) transmit funds to a pool participant after proper notification to the state treasurer to disburse funds to a pool participant may result in a bank overdraft in the pool participant's bank account. The state treasurer will reimburse a pool participant for such bank overdraft penalties charged to the pool participant's bank account.
In order to withdraw funds from the money market fund, a pool participant must notify the state treasurer of any withdrawal over one million dollars no later than 9 a.m. on the same day the withdrawal is made except for funds transmitted by ACH. Withdrawals for one million dollars or less, other than those funds transmitted by ACH, can be requested at any time prior to 10 a.m. on the day of withdrawal.
For all other withdrawals from the money market fund over one million dollars that are requested prior to 10 a.m., a pool participant may receive such withdrawal on the same day it is requested at the sole discretion of the state treasurer.
Participants requesting withdrawals via ACH must notify the state treasurer no later than 2 p.m. the business day prior to the requested withdrawal date. Funds contributed by ACH will not be available for withdrawal for a period of time as designated by the state treasurer in the prospectus.
Withdrawal requests with respect to the money market fund received in good order will receive the net asset value per unit of the money market fund next determined after the order is accepted by the state treasurer.
(2) Withdrawal procedures for the extended asset fund.
Withdrawal orders will be accepted on a quarterly basis and must be received two business days prior to the intended withdrawal date. Withdrawals will occur on the 10th calendar day of the months so designated in the prospectus. If the 10th is not a business day, the withdrawal will occur on the following business day. Other withdrawals may be permitted due to necessity, if the governing body of a pool participant sets forth, by resolution or other appropriate official action, that a withdrawal is necessary to meet the cash flow needs of the pool participant.
Withdrawals from the extended asset fund will be effected by way of a corresponding contribution into the pool participant's specified money market fund account. On the withdrawal date, shares will be sold from the specified extended asset fund account at the net asset value determined as of the next business day after the order acceptance date. Shares of the money market fund will be purchased using the money market fund's net asset value determined as of the next business day after the order acceptance date.
Pool participants must notify the state treasurer of any withdrawal two business days prior to a permitted withdrawal date no later than the time on that day specified in the prospectus. The state treasurer may allow withdrawals with less than the required notice in its sole discretion.
AMENDATORY SECTION (Amending WSR 13-03-043, filed 1/9/13, effective 2/9/13)
WAC 210-10-080 Transfer procedures.
A pool participant may transfer funds from one money market fund account to another. To ensure same day credit, a pool participant must inform the state treasurer of any transfer no later than 10 a.m. on the same day the transfer is made. Contributions to the money market fund through ACH will not be available for transfer for a period of time as designated by the state treasurer in the prospectus.
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