LOCAL GOVERNMENT CODE
CHAPTER 116. DEPOSITORIES FOR COUNTY PUBLIC FUNDS
SUBCHAPTER A. GENERAL PROVISIONS
§ 116.001. DEFINITIONS. In this chapter:
(1) "Bank" means a:
(A) bank organized under the laws of this state,
another state, or federal law that has its main office or a branch
office in this state; or
(B) savings and loan association or savings bank
organized under the laws of this state, another state, or federal
law that has its main office or a branch office in this state.
(2) "Demand deposit" means a deposit of funds that may
be withdrawn on the demand of the depositor.
(3) "Time deposit" means a deposit of funds subject to
a contract between the depositor and the depository under which the
depositor may not withdraw any of the funds by check or by another
manner until the expiration of a certain period following written
notice of the depositor's intent to withdraw the funds.
(4) "Subdepository bank" means an authorized bank,
other than a depository, that holds demand deposits, not exceeding
the Federal Deposit Insurance Corporation's limit, of a district,
county, or precinct officer.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987. Amended
by Acts 1991, 72nd Leg., ch. 527, § 1, eff. Sept. 1, 1991; Acts
1993, 73rd Leg., ch. 234, § 4, eff. Sept. 1, 1993; Acts 1999,
76th Leg., ch. 344, § 5.009, eff. Sept. 1, 1999.
§ 116.002. MONEY AFFECTED. (a) This chapter applies
to money collected or held by a district, county, or precinct
officer in a county and by the officers of a defined district or
subdivision in the county, including the funds of a municipal or
quasi-municipal subdivision or corporation that has the power to
select its own depository but has not done so. The money shall be
deposited under this chapter, and the money shall be considered in
fixing, and is protected by, a county depository's bond.
(b) Warrants, checks, and vouchers evidencing the money
deposited in the county depository under Subsection (a) are subject
to audit and countersignature as provided by law.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
SUBCHAPTER B. ESTABLISHMENT OF DEPOSITORY
§ 116.021. DEPOSITORY AND SUBDEPOSITORY
CONTRACTS. (a) The commissioners court of a county at its May
regular term immediately following each general election for state
and county officers shall contract with one or more banks in the
county for the deposit of the county's public funds. The county
shall contract with a bank under this section for a two-year or
four-year contract term.
(b) If the contract is for a four-year term, the contract
shall allow the bank to establish, on the basis of negotiations with
the county, new interest rates and financial terms of the contract
that will take effect during the final two years of the four-year
contract if:
(1) the new financial terms do not increase the prices
to the county by more than 10 percent; and
(2) the county has the option to choose to use the
initial variable interest rate option or to change to the new fixed
or variable interest rate options proposed by the bank.
(c) If for any reason a county depository is not selected
under Subsection (a), the commissioners court, at any subsequent
time after 20 days' notice, may select, by the process described by
Section 116.024 or by negotiated bid, one or more depositories in
the same manner as at the regular time.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987. Amended
by Acts 1991, 72nd Leg., ch. 527, § 2, eff. Sept. 1, 1991; Acts
1995, 74th Leg., ch. 65, § 1, eff. Aug. 28, 1995.
§ 116.022. NOTICE. (a) Once each week for at least 20
days before the May regular term of a commissioners court at which
the court will make a depository contract, the county judge shall
place over the judge's name in a newspaper published in the county a
notice that the commissioners court intends to make the contract. A
notice shall also be posted at the courthouse door of the county.
(b) If a newspaper is not published in the county, the
newspaper notice shall be placed in a newspaper published in the
nearest county.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987. Amended
by Acts 1995, 74th Leg., ch. 65, § 2, eff. Aug. 28, 1995.
§ 116.023. APPLICATIONS. (a) A bank in the county that
wants to be a county depository must deliver its application to the
county judge on or before the first day of the term of the
commissioners court at which depositories are to be selected.
(b) The application must state the amount of the bank's
paid-up capital stock and permanent surplus, and the application
must be accompanied by:
(1) a statement showing the financial condition of the
bank on the date of the application; and
(2) a certified check or cashier's check for at least
one-half percent of the county's revenue for the preceding year.
(c) The certified or cashier's check that accompanies an
application is a good-faith guarantee on the part of the applicant
that if accepted as a county depository it will execute the bond
required under this chapter. If a bank is selected as a depository
and does not provide the bond, the county shall retain the amount of
the check as liquidated damages, and the county judge shall
readvertise for applications, if necessary, to obtain a depository
for the county.
(d) A bank in the county that wants to be a county
subdepository must comply with Subsections (a) and (b)(1). The
subdepository's application must include a proposal outlining its
security for the county public funds to be held in addition to
revenue offers.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987. Amended
by Acts 1989, 71st Leg., ch. 628, § 4, eff. Aug. 28, 1989; Acts
1991, 72nd Leg., ch. 527, § 3, eff. Sept. 1, 1991.
§ 116.024. SELECTION OF DEPOSITORIES AND
SUBDEPOSITORIES. (a) At 10 a.m. on the first day of each term at
which banks are to be selected as county depositories, the
commissioners court shall:
(1) enter in the minutes of the court all applications
filed with the county judge;
(2) consider all applications; and
(3) select the qualified applicants that offer the
most favorable terms and conditions for the handling of the county
funds.
(b) The commissioners court may reject those applicants
whose management or condition, in the opinion of the commissioners
court, does not warrant placing county funds in their possession.
(c) After selecting one or more county depositories, the
commissioners court shall immediately return the certified checks
of the rejected applicants. The commissioners court shall return
the check of a successful applicant when the applicant executes and
files a depository bond that is approved by the commissioners
court.
(d) The conflict of interests provisions of Section 131.903
apply to the selection of the depositories.
(e) After selecting one or more subdepositories, the
commissioners court shall immediately notify each selected
applicant of its selection. Within 15 days, the selected applicant
must file a bond or other security as approved by the commissioners
court.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987. Amended
by Acts 1991, 72nd Leg., ch. 527, § 4, 5, eff. Sept. 1, 1991;
Acts 1993, 73rd Leg., ch. 268, § 29, eff. Sept. 1, 1993.
§ 116.025. DESIGNATION OF DEPOSITORY OR
SUBDEPOSITORY. When security is provided in accordance with
Subchapter C and is approved by the commissioners court, the
commissioners court shall, by an order entered in its minutes,
designate the bank as a depository or subdepository for the funds of
the county. The designation is effective until the end of the 60th
day after the date fixed for the next selection of a depository or
subdepository.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987. Amended
by Acts 1991, 72nd Leg., ch. 527, § 6, eff. Sept. 1, 1991.
§ 116.026. APPLICANTS OUTSIDE COUNTY. If no bank
located in the county applies to be designated as the county
depository, the commissioners court may advertise, in the same
manner provided by Section 116.022 for advertising for a depository
within the county, for applications from banks in an adjoining
county or any other county in this state.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
§ 116.027. SELECTION OF NONAPPLICANT
DEPOSITORY. (a) If no application to be a county depository is
submitted, or if all of the applications are declined, the
commissioners court shall deposit the funds of the county with any
one or more banks in the county or in the adjoining counties in the
amounts and for the periods as the commissioners court considers
advisable.
(b) A bank that receives deposits under this section shall
provide security in the manner and form, and subject to the same
conditions, as is required for a depository of county funds. The
penalty of the security must at least equal the total amount of
county funds deposited with the bank.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
SUBCHAPTER C. SECURITY FOR FUNDS HELD BY DEPOSITORY
§ 116.051. QUALIFICATION AS DEPOSITORY OR
SUBDEPOSITORY. Within 15 days after the date a bank is selected as
a county depository or subdepository, the bank must qualify as the
depository or subdepository by providing security for the funds to
be deposited by the county with the bank. The depository or
subdepository may secure these funds, at the option of the
commissioners court, by:
(1) personal bond; surety bond; bonds, notes, and
other securities; first mortgages on real property; real
property; certificates of deposit; or a combination of these
methods, as provided by this subchapter; or
(2) investment securities or interests in them as
provided by Chapter 726, Acts of the 67th Legislature, Regular
Session, 1981 (Article 2529b-1, Vernon's Texas Civil Statutes).
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987. Amended
by Acts 1989, 71st Leg., ch. 1, § 15(b), eff. Aug. 28, 1989; Acts
1991, 72nd Leg., ch. 527, § 7, eff. Sept. 1, 1991.
§ 116.052. PERSONAL BOND. (a) One or more personal
bonds executed and filed with the commissioners court, payable to
the county judge and the judge's successors in office, qualify as
security under this subchapter if:
(1) the bonds are signed by at least five solvent
sureties who own unencumbered real property in the state that is not
exempt from execution under the constitution and other laws of this
state;
(2) the unencumbered and nonexempt real property owned
by the sureties has a value at least equal to the amount of the
bonds; and
(3) the bonds are approved by the commissioners court.
(b) When a bond is filed for approval with the commissioners
court under Subsection (a), the sureties shall also file a
statement containing:
(1) a description of the unencumbered and nonexempt
real property sufficient to identify it on the ground; and
(2) the value of each tract of real property listed,
including the value of the improvements on the property.
(c) After the commissioners court approves a personal bond,
it shall be filed in the county clerk's office with the statement of
the sureties attached to the bond.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
§ 116.053. SURETY BOND. (a) One or more bonds issued
and executed by one or more solvent surety companies authorized to
do business in this state, payable to the county judge and the
judge's successors in office and filed with the commissioners
court, qualifies as security under this subchapter if the bond is
approved by the commissioners court.
(b) After the commissioners court approves a surety bond, it
shall be filed in the county clerk's office.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
§ 116.054. BONDS, NOTES, AND OTHER SECURITIES. (a) A
county depository may pledge with the commissioners court as
security under this subchapter:
(1) a bond, note, security of indebtedness, or other
evidence of indebtedness of the United States if the evidence of
indebtedness is supported by the full faith and credit of the United
States or is guaranteed as to principal and interest by the United
States;
(2) a bond of this state or of a county, municipality,
independent school district, or common school district;
(3) a bond issued under the federal farm loan acts;
(4) a road district bond;
(5) a bond, pledge, or other security issued by the
board of regents of The University of Texas System;
(6) bank acceptances of banks having a capital stock
of at least $500,000;
(7) a note or bond secured by mortgages insured and
debentures issued by the Federal Housing Administration;
(8) shares or share accounts of a savings and loan
association organized under the laws of this state or of a federal
savings and loan association domiciled in this state if the payment
of the share or share accounts is insured by the Federal Savings and
Loan Insurance Corporation; or
(9) a bond issued by a municipal corporation in this
state.
(b) Securities provided under this section must have a total
market value equal to the amount of the depository bond.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
§ 116.055. FIRST MORTGAGES ON IMPROVED REAL
PROPERTY. (a) If approved by the commissioners court, closed
first mortgages on improved and unencumbered real property located
in this state that are assigned to the county judge in a duly
acknowledged instrument qualify as security under this subchapter.
(b) Before approving a mortgage as security, the
commissioners court shall require:
(1) a written opinion by an attorney selected by the
commissioners court showing that the lien is superior to any other
claim to or right in the real property; and
(2) insurance approved by the county judge covering
the improvements on each tract of pledged real property and
providing that a loss is payable to the county judge.
(c) An insurance policy required under Subsection (b) must
be issued by a stock fire insurance company or mutual fire insurance
company that has a $100,000 surplus in excess of all legal reserves
and other liabilities.
(d) A mortgage accepted as security under this section shall
immediately be recorded in each county in which part of the real
property is located.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
§ 116.056. REAL PROPERTY. (a) If approved by the
commissioners court, improved and unencumbered real property,
pledged directly by deed of trust to a trustee selected by the
commissioners court, with the county judge as beneficiary,
qualifies as security under this subchapter.
(b) Before approving real property offered as security, the
commissioners court shall require:
(1) a written opinion by an attorney selected by the
commissioners court showing that the lien is superior to any other
claim to or right in the real property; and
(2) insurance approved by the county judge covering
the improvements on the pledged real property and providing that a
loss is payable to the county judge.
(c) An insurance policy required under Subsection (b) must
be issued by a stock fire insurance company or mutual fire insurance
company that has a $100,000 surplus in excess of all legal reserves
and other liabilities.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
§ 116.0565. CERTIFICATE OF DEPOSIT. (a) A certificate
of deposit qualifies as security under this subchapter if the
certificate is:
(1) held in the custody of a Federal Reserve Bank for
safekeeping and made the subject of a valid pledge agreement
designating the county as the beneficiary of the pledge agreement;
(2) insured in full by the Federal Savings and Loan
Insurance Corporation or the Federal Deposit Insurance
Corporation;
(3) described in detail by a safekeeping receipt
issued to the county by the Federal Reserve Bank having custody of
the certificates; and
(4) issued with the county as registered owner.
(b) A person to whom presentment of a certificate of deposit
pledged to secure county funds is made may not pay or otherwise
accept the certificate unless the certificate or the safekeeping
receipt required by this section has been endorsed by the county and
the depository.
Added by Acts 1989, 71st Leg., ch. 1, § 15(b), eff. Aug. 28,
1989.
§ 116.057. CONDITION OF PERSONAL BOND OR CONTRACT FOR
SECURITIES. (a) A personal bond provided or a contract for the
pledge of securities under this subchapter must be conditioned that
the depository will:
(1) faithfully keep the county funds and faithfully
perform all duties and obligations imposed by law on the
depository;
(2) pay all checks drawn on a demand deposit account in
a depository on presentation by the county treasurer;
(3) pay all checks drawn on a time deposit account on
presentation after the expiration of the required period of notice;
and
(4) account for the county funds as required by law.
(b) A suit on a personal bond or a contract for securities
provided or pledged under this subchapter must be tried in the
county for which the depository is selected.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
§ 116.058. AMOUNT OF SECURITY REQUIRED. (a) Personal
or surety bonds that secure county deposits must be in an amount
equal to the estimated highest daily balance of the county, as
determined by the commissioners court. However, the commissioners
court may not estimate the highest daily balance at an amount that
is less than 75 percent of the highest daily balance of the county
for the preceding year, less the amount of bond funds received and
expended.
(b) Securities pledged to secure county funds on deposit in
a depository must be in an amount equal to the amount of those
funds. However, real property securities may not be required in an
amount greater than 25 percent of the assessed value of the property
in the county, as shown by the certified tax roll for the preceding
year.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
§ 116.059. VALUATION OF REAL PROPERTY PROVIDED AS
SECURITY. The commissioners court shall investigate all real
property security and determine the value at which the property
will be accepted. The commissioners court may not accept real
property as security at a value greater than 50 percent of the
reasonable market value of the property covered by a mortgage
unless the mortgage is insured or guaranteed by the Federal Housing
Administration.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
§ 116.060. SECURITY NOT REQUIRED FOR FEDERALLY INSURED
DEPOSITS. A depository is not required to provide security for the
deposit of county funds to the extent the deposits are insured under
12 U.S.C.A. Sections 1811-1832.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
SUBCHAPTER D. MAINTENANCE AND MODIFICATION OF SECURITY
§ 116.081. NEW BOND. (a) The commissioners court may
by written order require a depository to execute a new bond whenever
the commissioners court considers it advisable or considers it
necessary for the protection of the county.
(b) Except for an additional bond required under Section
116.087, if a depository fails for any reason to file the required
new bond within five days after the date the depository is served
with a copy of the order, the commissioners court may select a new
depository in the same manner as it would select a depository at the
regular time.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
§ 116.082. SUBSTITUTION OF SECURITIES. (a) After
reasonable notice to the commissioners court, a depository is
entitled to substitute one type of security for another or replace
particular securities with others of the same type if the
substituting or replacing security meets the requirements of law
and is approved by the commissioners court. Instead of approval of
each substitute or replacement security by the commissioners court,
the commissioners court may:
(1) adopt a procedure for approving a substitute or
replacement security under this section; and
(2) designate a county employee or official, including
a county judge, to approve the substitute or replacement security
under the procedure adopted under Subdivision (1).
(b) The county judge shall execute the necessary
instruments to transfer to the depository or its order a lien
withdrawn from real property for which another security is
substituted.
(c) The commissioners court may direct the manner in which
securities pledged in place of personal or surety bonds are to be
deposited.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987. Amended
by Acts 2003, 78th Leg., ch. 742, § 1, eff. June 20, 2003.
§ 116.083. RELEASE OF EXCESS SECURITY. If the
securities pledged by a depository to secure county funds exceed
the amount required under this chapter, the commissioners court
shall permit the release of the excess.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
§ 116.084. INADEQUATE SECURITY. If for any reason the
county funds on deposit with the county depository exceed the
amount of security pledged, the depository shall immediately pledge
additional security with the commissioners court.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
§ 116.085. SOLVENCY OF PERSONAL SURETY. (a) At least
twice each year while a personal bond securing the county's
deposits is in effect, the commissioners court shall investigate
the solvency of each surety on the bond. The commissioners court
may require the surety to make an itemized and verified financial
statement correctly showing the surety's financial position and, if
the bond requires the surety to own real property, identifying each
tract of real property owned by the surety and stating its value.
(b) The commissioners court shall require a depository to
provide a new bond meeting the requirements of this chapter if a
financial statement provided under Subsection (a) indicates that:
(1) a surety is insolvent;
(2) a surety's net worth is less than the amount
required by this chapter;
(3) the assets listed on the statement are depreciated
or their value is in any way impaired; or
(4) real property required by the bond has been
disposed of or encumbered and the value of the surety's remaining
unencumbered and nonexempt real property is inadequate to meet the
requirements of this chapter.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
§ 116.086. SOLVENCY OF SURETY COMPANY AND ADEQUACY OF
SECURITIES. Whenever the commissioners court considers it
necessary for the protection of the county, the commissioners court
may investigate the solvency of a surety company that issues a bond
on behalf of a depository of county funds or investigate the value
of securities pledged by a depository to secure county funds.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
§ 116.087. ADDITIONAL BOND. (a) If after a county
establishes a depository the county or a subdivision of the county
receives funds from the sale of bonds or otherwise, at the next
meeting of the commissioners court, or as soon afterward as is
practical, the commissioners court may make written demand on the
depository to provide an additional bond in an amount equal to the
amount of funds received. If county funds derived from the sale of
county securities during the term of a depository bond are
deposited with the depository, the commissioners court shall
require an additional bond in an amount equal to the additional
county funds. The depository shall continue the additional bond in
effect as long as the additional funds remain in the depository.
(b) The depository may cancel this extra or special bond and
concurrently substitute a new bond for it as the additional funds
are reduced. However, the additional bond must always at least
equal the amount of the additional funds.
(c) If a depository does not provide an additional bond
under Subsection (a) within 30 days after the date the
commissioners court demands the additional bond, the commissioners
court may withdraw the additional funds from the depository by the
draft of the county treasurer and deposit them in a solvent national
or state bank that has a combined capital stock and surplus greater
than the amount of the additional funds. The commissioners court
may leave the additional funds on deposit with this alternative
bank until the county depository files the required additional bond
with the commissioners court, after which the commissioners court
shall redeposit the balance of the additional funds with the county
depository.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
§ 116.088. RELEASE OF SURETY COMPANY. (a) A surety
company may be relieved of its obligations under a surety bond
executed on behalf of a county depository after the 30th day after
the date it gives written notice to the commissioners court
requesting to be released.
(b) A surety company is not relieved under Subsection (a) of
liability for a loss sustained by the county before the expiration
of the bond.
(c) If a depository's surety company requests to be relieved
from its obligations under Subsection (a), the depository shall
provide further security acceptable to the commissioners court to
secure county funds under this chapter. The depository shall
provide the further security before termination of the surety's
obligations under the bond. The new security shall be filed in the
county clerk's office.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
§ 116.089. SURRENDER OF INTEREST ON SECURITIES. On the
request of a county depository, the commissioners court shall
surrender, when due, interest coupons or other evidence of interest
on securities deposited by the depository with the commissioners
court if the securities remaining pledged by a depository are
adequate to meet the requirements of the commissioners court.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
SUBCHAPTER E. DEPOSITORY ACCOUNTS
§ 116.111. CHARACTER AND AMOUNT OF DEPOSITS. The
commissioners court may determine and designate the character and
amount of county funds that will be demand deposits and that will be
time deposits. The commissioners court may contract with a
depository for interest on time deposits at any legal rate under a
federal law or under a rule adopted by the board of governors of the
Federal Reserve System or by the board of directors of the Federal
Deposit Insurance Corporation.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
§ 116.112. INVESTMENT OF FUNDS. (a) The commissioners
court may direct the county treasurer to withdraw any county funds
deposited in a county depository that are not immediately required
to pay obligations of the county and invest those funds as provided
by this section unless such an investment or withdrawal is
prohibited by law or the withdrawal is contrary to the terms of the
depository contract.
(b) The funds may be invested in accordance with Subchapter
A, Chapter 2256, Government Code. In addition to the obligations,
certificates, and agreements described by that Act, the funds may
be invested in certificates of deposit issued by a state or federal
savings and loan association domiciled in this state, the payment
of which is insured in full by the Federal Savings and Loan
Insurance Corporation or its successor.
(c) If a county purchases a security repurchase agreement,
the agreement must be purchased under a master contractual
agreement that specifies the rights and obligations of both parties
and that requires that securities involved in the transaction be
held in a safekeeping account subject to the control and custody of
the county.
(d) Repealed by Acts 1989, 71st Leg., ch. 754, § 2, eff.
June 15, 1989.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987. Amended
by Acts 1989, 71st Leg., ch. 1, § 15(c), eff. Aug. 28, 1989; Acts
1989, 71st Leg., ch. 754, § 1, 2, eff. June 15, 1989; Acts 1995,
74th Leg., ch. 76, § 5.95(11), eff. Sept. 1, 1995.
§ 116.113. DEPOSIT OF FUNDS. (a) Immediately after
the commissioners court designates a county depository, the county
treasurer shall transfer to the depository all of the county's
funds and the funds of any district or municipal subdivision of the
county that does not select its own depository. The treasurer shall
also immediately deposit with the depository to the credit of the
county, district, or municipality any money received after the
depository is designated.
(b) A county tax assessor-collector shall immediately
deposit in the county depository taxes collected on behalf of the
state, the county, or a district or municipal subdivision of the
county. The taxes remain on deposit pending the preparation and
settlement of the assessor-collector's report on the tax
collections.
(c) If a commissioners court that controls school district
funds elects to transfer the funds during a school year from a
county depository to another bank, the school district may require
the commissioners court to delay the transfer until the earlier of
the end of the school district's current fiscal year or the next
September 1.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
§ 116.114. COLLECTIONS BY DEPOSITORY. A county
depository shall collect all checks, drafts, and demands for money
deposited with it by the county.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
§ 116.115. CLEARINGHOUSE FOR MULTIPLE DEPOSITORIES. If
the funds of a county are deposited with more than one depository,
the commissioners court shall by order name one of the depositories
to act as a clearinghouse for the others. All county warrants are
finally payable at the depository named as the clearinghouse.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
§ 116.116. OBLIGATIONS PAYABLE AT COUNTY
DEPOSITORY. (a) A county depository shall pay a check or warrant
drawn by the county treasurer against funds deposited with the
depository on presentation of the check or warrant if the funds
subject to the check or warrant are in the possession of the
depository, and, in the case of a time deposit, if the agreed period
of notice has expired.
(b) If the commissioners court selects a depository in
another county under Section 116.026, the depository shall file a
statement with the county treasurer designating the place in the
county governed by the commissioners court where, and the person by
whom, deposits by the treasurer may be received and checks will be
paid, or the place in another county where deposits may be made and
checks may be paid. The statement must be filed within five days
after the date notice is given to the depository of its selection.
(c) A warrant or check, including a warrant or check issued
prior to September 1, 1993, issued by the county treasurer in
settlement of a claim against a county that is not presented for
payment before the 366th day following the date of issuance is
overdue and nonnegotiable. The sum of the overdue warrant or check
shall be credited as revenue to the county if delivery to the payees
was attempted or occurred within a reasonable time following the
issuance of the warrant or check. No right to full settlement of a
proper unpaid claim is extinguished by this subsection.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987. Amended
by Acts 1991, 72nd Leg., ch. 326, § 1, eff. June 5, 1991; Acts
1993, 73rd Leg., ch. 931, § 1, eff. Aug. 30, 1993; Acts 1997,
75th Leg., ch. 329, § 1, eff. May 26, 1997.
§ 116.117. STATEMENTS OF ACCOUNT. A depository shall
make a detailed monthly statement to the commissioners court at
each regular term of the court. The statement must show the daily
balance credited to each of the funds on deposit.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
§ 116.118. DEBTS PAYABLE OTHER THAN AT COUNTY
TREASURY. The commissioners court may instruct the county
treasurer to deposit money adequate to pay a bond, coupon, or other
indebtedness of the county at a place other than at the county
treasury if by its terms the indebtedness is payable on maturity at
the other location and if the payment is otherwise made in the
manner required by law.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
§ 116.119. REQUIREMENTS FOR AUDITING AND COUNTERSIGNING
UNAFFECTED. This chapter does not affect the application of a law
or regulation providing for auditing and countersigning.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
§ 116.120. COLLECTION OF CERTAIN OVERDUE COUNTY WARRANTS
OR CHECKS. (a) This section applies only to a warrant or check
issued by a county treasurer in settlement of a claim against a
county that has not been presented for payment.
(b) A person attempting to recover funds from the county for
a check or warrant issued by the county treasurer may not charge the
person to whom the check or warrant was issued and on whose behalf
the attempted recovery is made, or that person's successors or
assigns, a fee in an amount equal to more than 10 percent of the face
value of the check or warrant.
(c) A county treasurer may collect a reasonable research fee
to determine if a claim submitted under this section is valid. The
treasurer may include the costs of inquiries to depository banks,
research of accounting records, and other similar actions in
setting the fee. A county treasurer may require the fee to be paid
before a claim may be processed or researched under this section.
Added by Acts 1997, 75th Leg., ch. 142, § 1, eff. Sept. 1, 1997.
SUBCHAPTER F. LIABILITIES
§ 116.151. LIABILITIES OF SURETIES ON SEPARATE
BONDS. If a county depository provides separate bonds to secure
county funds, each surety under a bond is liable only for that part
of a loss resulting from the failure of the depository that bears to
the total loss the same ratio as the amount of the bond bears to the
total amount of all bonds and securities held by the county for the
protection of the funds covered by the bond.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
§ 116.152. SUBROGATION OF SURETIES. If a personal
surety or a surety company pays for a loss to a county under a
depository bond, the surety is subrogated to the rights of the
county in an amount equal to the amount of the surety's payment.
However, the amount of the subrogation may not exceed the amount of
the deposit secured by the surety at the time of the depository's
default.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
§ 116.153. PRO RATA RECOVERY BY STATE AND COUNTY. If a
county depository becomes insolvent and it becomes necessary to
resort to the depository's bond or bonds to recover funds of the
county and the state, the state and county are entitled to share pro
rata in the recovery.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
§ 116.154. LIABILITY OF DEPOSITORY PENDING COLLECTION OF
DEPOSITS. A county depository that uses due diligence to collect a
check, draft, or demand for money deposited by the county with the
depository is not liable for the collection until the proceeds have
been received by the depository. The depository shall charge the
county and the county shall pay a collection expense that the
depository may not pay or absorb because of a federal law or a
regulation adopted by the board of governors of the Federal Reserve
System or by the board of directors of the Federal Deposit Insurance
Corporation.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
§ 116.155. FAILURE OF DEPOSITORY TO PAY CHECK OR
WARRANT. A depository that does not pay a check or warrant as
required by Section 116.116(a) is liable for and shall pay to the
holder 10 percent of the amount of the check or warrant, and the
commissioners court shall revoke the order creating the depository.
Acts 1987, 70th Leg., ch. 149, § 1, eff. Sept. 1, 1987.
