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agreement as set forth in paragraph 8 of subdivision three of section
ten of this article.

[3] 4. Notwithstanding any other provision of law, the [aforede-
scribed] governing board of a local government may authorize the afore-
mentioned officers to turn over the physical custody and safekeeping of
the evidences of the investments made pursuant to this section [eleven]
to (a) any bank or trust company incorporated in this state, or (b) any
national bank located in this state, or (c) any private banker duly
authorized by the superintendent of banks of this state to engage in
business here. All such private bankers shall, as private bankers, main-
tain a permanent capital of not less than one million dollars in this
state. The said officers may direct such bank, trust company or private
banker to register and hold any such evidences of investments in its
custody, in the name of its nominee. [These] Such officers may deposit
or authorize such bank, trust company or private banker, to deposit, or
arrange for the deposit of any such evidences of investments with a fed-
eral reserve bank or other book-entry transfer system operated by a fed-
erally, regulated entity to be credited to an account to which the
ownership of, and other interests in, such evidences of investments may
be transferred by entries on the books of such federal reserve bank
other book-entry transfer system operated by a federally regulated en-
tity without physical delivery of any such evidences of investments. The
records of any such bank, trust company or private banker shall show, at
all times, the ownership of such evidences of investments, and they
shall, when held in the possession of such bank, trust company or pri-
vate banker be, at all times, kept separate from the assets

such
bank, trust company or private banker. All evidences of investments
delivered to a bank, trust company, or private banker pursuant to this
subdivision shall be held by such bank, trust company or private banker
pursuant to a written custodial agreement as set forth in paragraph a of
subdivision three of section ten of this article. When any such evi-
dences of investments are so registered in the name of a nominee, such
bank, trust company or private banker shall be absolutely liable for any
loss'occasioned by the acts of such nominee with respect to such

evi-
dences of investments.

[4], 5. A county clerk may, [deposit or] invest any money collected on
behalf of the state until such time as the money is required to be
mitted to the state. The county clerk shall [deposit or] invest the
state money only in those [deposits or] investments authorized by this
section and payable within such time as the proceeds shall be required
to be remitted to the state. Any interest that accrues moneys
[deposited or] invested pursuant to this subdivision shall be payable in
equal shares to the state and to the county provided, however, that
fees service charges associated with the [deposit or] investment
shall be paid from such interest.

6. Except as may otherwise be provided in a contract with bond or note
holders, any moneys of a political subdivision authorized to be invested
pursuant to this section may

be commingled for investment purposes; provided, however, that any investment of commingled moneys shall be payable or redeemable at the option of the owner within such time as the proceeds shall be needed to meet expenditures for which such moneys were obtained or

otherwise specifically provided in this section. The
separate identity of the sources of such funds shall at all times be
maintained and income received on moneys commingled for the purpose of
investment shall be credited on a pro rata basis to the fund or account
from which the moneys were invested.

7. The chief fiscal officer of each local government shall maintain or
cause to be maintained a proper record of, all books, notes, securities
or other evidences of indebtedness held by or for such subdivision for
the purpose of investment. Such record shall at least identify the
security, the fund for which held, the place where kept and entries
shall be made therein showing date of sale or other disposition and the
amount realized therefrom.

§ 14. Sections 212 and 213 of the county law are repealed and a new
section 212 is added to read as follows:

§ 212. Designation of depositaries. All noneys received by the county
treasurer shall be deposited and secured in the manner proyided by Şec-
tion ten of the general municipal law. Nothing herein shall be deemed to
limit the power of a court of competent jurisdiction or

of the state
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comptroller to make directions concerning deposits of court and trust funds.

§ 15. Section 262 of the county law, as added by chapter 1018 of the laws of 1963, is amended to read as follows:

§ 262. Performance of the work. After a district shall have been established, the administrative head or body shall cause to be prepared by the county engineer, or other county officer having equivalent qualifications, or a duly licensed engineer employed for that purpose, detailed plans and specifications for the improvement, a careful estimate of the expense, and, with the assistance of the county attorney, or an attorney employed for that purpose, a proposed contract or contracts for the execution of the work. The administrative head or body shall examine such detailed plans, specifications, estimates and contracts and may adopt, modify, amend or reject the same. Upon adoption of the plans, specifications, estimates and proposed contract, the administrative head or body shall cause contracts to be let in the manner provided for other county construction projects. Nothing herein shall prevent the purchase or condemnation of any existing county system, portion or portions thereof, whether inside or outside of the county, necessary for the purposes of the county district, provided, however, that there shall be no power to condemn property thé legal title to which is vested in a public corporation or a special improvement district unless the shall consent thereto. The cost thereof, together with the cost of construction of those facilities proposed to be constructed, shall not ceed the maximum cost of the project as advertised in the notice of hearing published pursuant to section two hundred fifty-four of this article. In the event that a system owned by a municipal corporation or district is purchased, the county may by agreement with the seller, as

the payment of annual installments of principal of, and interest on, obligations issued by the selling municipality to finance the cost of the facilities so sold. If payment of annual installments of debt service is not assumed, as aforesaid, the selling municipality shall set aside in reserve fund, so much of the purchase price received as is sufficient to meet all future installments of principal of, and interest on,

outstanding obligations issued by it to finance the cost of the facilities sold. Moneys in such a reserve fund

may be invested provided in section (six-f] eleven of the general municipal law.

§ 16. Section 280-m of the county law, as added by chapter 1185 of the laws of 1971, is amended to read as follows:

5 280-m. Performance of the work. After a district shall have been established, the administrative head or body shall cause to be prepared by the county engineer,, or other county officer having equivalent qualifications, or a duly licensed engineer employed for that pụrpose, detailed plans and specifications for the improvement, a careful estimate of the expense, and, with the assistance of the county attorney, or

attorney employed for that purpose, a proposed contract or contracts for the execution of the work. The administrative head or body shall examine such detailed plans, specifications, estimates and contracts and may adopt, modify, amend or reject the same. Upon adoption of the plans, specifications, estimates and proposed contract, the administrative head or body shall cause contracts to be let in the same manner provided for other county construction projects. Nothing herein shall prevent the purchase or condemnation of any existing county system,

portion or portions thereof, whether inside or outside of the county, necessary for the purposes of the county district, provided, however, that there shall be no power to condemn property the legal title to which is vested in a public corporation or a special improvement district unless the owner shall consent thereto. The cost thereof, together with the cost of construction of those facilities proposed to be constructed, shall not ceed the maximum cost of the project as advertised in the notice of hearing published pursuant to section two hundred eighty-e of this article. In the event that a system owned by a municipal corporation or existing district is purchased, the county may by agreement with the seller,

the payment of annual installments of principal of, and interest on, obligations issued by the selling municipality to finance the cost of the facilities so sold. If payment of annual installments of debt service is not assumed, as aforesaid, the selling municipality shall set aside in

reserve fund, much of the purchase price received as is sufficient to meet all future installments of principal of, and interest on, outstanding obligations issued by it to finance the cost of the facilities sold. Moneys in such a reserve fund may be in

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vested as provided in section (six-f] eleven of the general municipal law.

§ 17. Subdivision 1 of section 259 of the education law, as amended by chapter 200 of the laws of 1973, is amended to read as follows:

1. Taxes, in addition to those otherwise authorized, may be voted for library purposes by any authority named in section two hundred fiftyfive of this chapter and shall, unless otherwise directed by such vote, be considered as annual appropriations therefor until changed by further vote and shall be levied and collected yearly, or as directed, as are other general taxes. In the case of a school district the appropriation for library purposes shall be submitted to the voters of the district in a separate resolution and shall not be submitted as a part of the appropriation of the necessary funds to meet the estimated expenditures of the school district. All moneys received from taxes or other public sources for library purposes shall be kept as a separate library fund by the treasurer of the municipality or district making the appropriation and shall be expended only under direction of the library trustees on properly authenticated vouchers, except that money, received from taxes and other public sources for the support of a public library or a free association library or a cooperative library system shall be paid over to the treasurer of such library or cooperative library system upon the written demand of its trustees. All such moneys paid over

to

public library treasurer shall be deposited and secured in the manner provided by section ten of the general municipal law and the library trustees the library treasurer, if the trustees shall delegate such duty to him, may invest such moneys' in the manner provided by section eleven of such law.

§ 18. Section 1604-a of the education law is repealed and a new section 1604-a is added to read as follows:

$ 1604-a. Temporary investment of school moneys. The board of trustees of any common school district may authorize the district treasurer other officer having custody, of district moneys to invest moneys of the district in the manner provided by section eleven of the general municipal law.

§ 19. Section 1723-a of the education law is repealed and a new section 1723-a is added to read as follows:

§ 1723-a. Temporary investment of school moneys. The board of education of any union free school district may authorize the district trea

other officer having custody of district moneys to invest moneys of the district in the manner provided by section eleven of the general municipal law.

§ 20. Paragraph k of subdivision 4 of section 1950 of the education law, as amended by chapter 133 of the laws of 1969 and such section renumbered by chapter 378 of the laws of 1972, is amended to read as follows:

k. Designate a [bank or banks] depositary within the territorial limits of any component district for the deposit of money in the manner provided by section ten of the general municipal law. The receipt, deposit,, investment and disbursement of moneys, and all procedures relating thereto, including, but not limited to the requirements for signatures, the appointment of an auditor to approve claims for purchases, and the optional use of claim forms, shall be subject to the laws relating to union free school [district] districts.

21. Section 2129 of the education law, as amended by chapter 466 of the laws of 1976, is amended to read as follows:

§ 2129. Deposit of moneys by treasurer and collector. [The board of trustees shall designate by

written resolution duly adopted by majority vote of such board which shall be entered in its minutes, banks for the deposit of all] All moneys received by the

treasurer and collector[; provided, that such designation shall be made of a bank within the state.

Such treasurer and collector shall deposit all moneys received by them only in such banks as are so designated. Such designation and deposit of the moneys received by the treasurer and collector shall release them and their sureties from any liabilities for loss of such moneys by reason

of the default insolvency of any such depositary] shall be deposited and secured in the manner provided by section ten of the general municipal law.

Subdivision 4 of section 2130 of the education law, as amended by chapter 466 of the laws of 1976, is amended to read as follows: EXPLANATION-Matter in italics is new; matter in brackets [ ] is old law

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4. The board of education in every union free school district whose limits do not correspond with those of an incorporated village or city shall appoint a district treasurer, and a collector who shall hold office during the pleasure of the board. The board shall also fix the compensation of the treasurer. The board of education of such district may also fix the compensation of the collector, which shall be in lieu of all fees to which a school district collector might be entitled, under the provisions of this chapter. [The board shall designate by writ; ten resolution duly adopted by majority vote of such board which shall be entered in its minutes, a bank, banks or banker for the deposit of all moneys received by the treasurer, collector, village receiver or village collector and town official who acts school collector; provided, that such designation shall be made of a bank or banks or banker or bankers within the state, and except that the board of education of the Fishers Island unión free school district in the town of Southold, Suffolk county, may so designate a bank in the state of Connecticut. ] The treasurer, collector, village receiver or village col, lector and town official who acts as school collector, shall deposit and secure all sums of money received and collected by them [only in a bank or banks so designated by the board. Such designation and deposit of the moneys received by any such officer shall release him and his surety from any liability for loss of such moneys by reason of the default or insolvency of any such depositary. It] in the manner provided by section ten of the general municipal law.

Notwithstanding the provisions of section ten of the general municipal law, the board of education of the Fishers Island union free school district in the town of Southold, Suffolk county may designate a depositary located in the state of Connecticut. The board may require a

report by the cashier of (such bank, banks or banker] the depositaries to be submitted at any regular meeting of the board of the amount of deposit to the credit of the treasurer.

§ 23. Sections 2131 and 3652 of the education law are repealed and a new section 3652 is added to read as follows:

§ 3652. Investment of moneys in reserve funds. The school authorities of any school district or the district treasurer or other officer having custody of the

moneys, if the school authorities shall delegate such duty to him, may invest moneys in any fund established pursuant to this article in the manner provided by section eleven of the general municipal law.

S 24. Section 3-b of the general city law is repealed and a new section 3-b is added to read as follows:

၌ 3-6. Deposit of city funds. Funds of a city shall be deposited and secured in the manner provided by section ten of the general municipal law.

§ 25. Section 54.20 of the local finance law, as added by chapter 1050 of the laws of 1981, is amended to read as follows:

$ 54.20 Funding of capital expenditures duly appropriated in the capital budget for the city of New York. Subject to the provisions of

the New York State

Financial Emergency Act for The City of New York but notwithstanding any other law to the contrary, to facilitate the funding of capital expenditures duly appropriated in the capital budget for the city of New York, the finance board of such city shall establish an count or accounts to receive amounts duly appropriated for capital pur; poses in the expense budget of such city. Any payment pursuant

to such an expense budget appropriation shall be made prior to completion of the annual audit of the fiscal year in which such appropriation was made. At its discretion, the finance board of such city shall apply amounts from any such account to capital expenditures duly appropriated in the capital budget of such city.

The moneys in any such account shall be deposited (in one or more of the banks of trust companies designated, ], and secured in the provided by [law, as depositories of the funds of such municipality] section ten of the general municipal law. The finance board or the chief fiscal officer of such municipality, if the finance board shall delegate such duty to him, may invest the moneys in each such fund in the manner provided in section (six-f] eleven of the general municipal law. Any interest earned or capital gains realized on the moneys so deposited or invested shall accrue to and become part of such account. The separate identity of such account shall be maintained, whether its assets consist of cash or investments or both.

§ 26. Section 165.00 of the local finance law, as amended by chapter 40% of the laws of 1961, paragraph a as amended by chapter 715% of the

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laws of 1963, paragraph b as amended by chapter 770 of the laws of 1969, the opening paragraph of paragraph b as amended by chapter 680 of the laws of 1976, the second and third unnumbered paragraphs of paragraph b as amended by chapter 413 of the laws of 1991 and paragraph < added by chapter 106 of the laws of 1983, is amended to read as follows:

§. 165.00 Deposit and use of proceeds from sale of bonds, bond anticipation notes, capital notes, urban renewal notes or budget notes.

a. The proceeds, inclusive of premiums, from the sale of bonds, bond anticipation notes, capital notes, urban' renewal notes or budget'notes shall be deposited and secured in a special account in [a bank or trust company located and authorized to do business in this state,) the manner provided by section ten of the general municipal law, shall not be commingled with other funds of the issuer, and shall be expended only for the object or purpose for which such obligations were issued. In the event that any portion of the proceeds, inclusive of premiums, from the sale of bonds, bond anticipation notes, capital notes, urban renewal notes or budget notes is not expended for the object purpose for which such obligations were issued, such portion shall be applied only to the payment of the principal of and interest on such obligations, respectively. Notwithstanding the foregoing provisions of this paragraph, the finance board of any municipality, school district, or district corporation may adopt any or all of the following resolutions to provide that:

1. The proceeds, inclusive of premiums, of capital notes issued in amounts of one hundred thousand dollars or léss, and of budget notes, need not be deposited in a special account but may be deposited and commingled with other funds of the issuer in any account of the issuer in a bank

trust company located and authorized to do business in this state, but such power shall not be construed as authorizing the use of such proceeds for object or purpose other than that for which the obligations were issued.

2. The proceeds, inclusive of premiums, from the sale of any two or more issues of bonds, bond anticipation notes, capital notes, urban renewal notes or budget notes need not be deposited in separate special accounts, but may be deposited in a single special account of the

issuer in a bank or trust company located and authorized to do business in this state, but shall not be commingled with other funds of the issuer. The chief fiscal officer shall then maintain a separate accounting record of each issue to insure that the proceeds shall be used only for the object or purpose for which the obligation was issued,

3. Moneys appropriated for a purpose for which bonds, bond anticipation notes, capital notes or urban renewal notes have been authorized may be deposited in the same bank account with the proceeds from the şale of such obligations. Such power shall not be construed as authorizing the use of the proceeds of such obligations for an object or purpose other than that for which they were issued. Provided, however, that any moneys remaining in such bank account after the object or purpose has been completed or abandoned shall be applied to the payment of the principal of and interest on such obligations; any excess remaining thereafter may be used for any lawful purpose.

b. Notwithstanding the provisions of paragraph a of this section, the proceeds, inclusive of premiums, from the sale of bonds, bond anticipa

capital notes and urban renewal notes may be invested in [obligations of the United States of America, or in obligations guaranteed by, agencies of the United States of America where the payment of principal and interest are guaranteed by the United States of America,

in obligations of the state of New York, or with the approval of the state comptroller in obligations issued pursuant to section

24.00 or 25.00 of this chapter by any municipality, school district or district corporation other than the municipality, school district

district corporation investing such proceeds pursuant to this paragraph, subject to the following conditions:

1. Such obligations, unless registered or inscribed in the name of the municipality, school district or district corporation for which the investment

is made, shall be purchased through, delivered to and held in the custody of a bank or trust company or, with respect to the city of New York, a reputable dealer in such obligations as shall be designated by the state comptroller, in this state and shall be sold

presented for redemption

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