{"data":{"id":"us-ky/krs-42.500","jurisdiction":"us-ky","citation":"KRS 42.500","heading":"State Investment Commission -- Powers.","body":"(1) There shall be a State Investment Commission composed of:\n(a) The State Treasurer who shall be chairman;\n(b) The secretary of the Finance and Administration Cabinet;\n(c) The state controller; and\n(d) Two (2) persons appointed by the Governor.\n(2) The individuals appointed by the Governor shall be selected as follows: one (1) to\nbe selected from a list of five (5) submitted to the Governor by the Kentucky\nBankers Association, and one (1) to be selected from a list of five (5) submitted to\nthe Governor by the Independent Community Bankers Association.\n(3) The State Investment Commission shall meet at least quarterly to review investment\nperformance and conduct other business. This provision shall not prohibit the\ncommission from meeting more frequently as the need arises.\n(4) The State Treasurer and secretary of the Finance and Administration Cabinet shall\neach have the authority to designate, by an instrument in writing over his or her\nsignature and filed with the secretary of the commission as a public record  of the\ncommission, an alternate with full authority to:\n(a) Attend in the member's absence, for any reason, any properly convened\nmeeting of the commission; and\n(b) Participate in the consideration of, and vote upon, business and transactions of\nthe commission.\nEach alternate shall be a person on the staff of the appointing member or in the\nemploy of the appointing member's state agency or department.\n(5) Any designation of an alternate may, at the appointing member's direction:\n(a) Be limited upon the fa ce of the appointing instrument to be effective for only\na specific meeting or specified business;\n(b) Be shown on the face of the appointing instrument to be a continuing\ndesignation, for a period of no more than four (4) years, whenever the\nappointing member is unable to attend; or\n(c) Be revoked at any time by the appointing member in an instrument in writing,\nover his or her signature, filed with the secretary of the commission as a\npublic record of the commission.\n(6) Any person transacting business with, or materially affected by, the business of the\ncommission may accept and rely upon a joint certificate of the secretary of the\ncommission and any member of the commission concerning the designation of any\nalternate, the time and scope of the designation, and, if it is of a continuing nature,\nwhether and when the designation has been revoked. The joint certificate shall be\nmade and delivered to the person requesting it within a reasonable time after it has\nbeen requested  in writing, with acceptable identification of the business or\ntransaction to which it refers and the requesting person's interest in the business or\ntransaction.\n(7) Any three (3) persons who are members of the commission or alternates authorized\nunder subsections (4) and (5) of this section shall constitute a quorum and may, by\nmajority vote, transact any business of the commission. Any three (3) members of\nthe commission may call a meeting.\n(8) The provisions of KRS 61.070 shall not apply to members of the commission.\n(9) The commission shall have authority and may, if in its opinion the cash in the State\nTreasury is in excess of the amount required to meet current expenditures, invest\nany and all of the excess cash in:\n(a) Obligations and contracts for f uture delivery of obligations backed by the full\nfaith and credit of the United States or a United States government agency,\nincluding but not limited to:\n1. United States Treasury;\n2. Export-Import Bank of the United States;\n3. Farmers Home Administration;\n4. Government National Mortgage Corporation; and\n5. Merchant Marine bonds;\n(b) Obligations of any corporation of the United States government or\ngovernment-sponsored enterprise, including but not limited to:\n1. Federal Home Loan Mortgage Corporation;\n2. Federal Farm Credit Banks:\na. Bank for Cooperatives;\nb. Federal Intermediate Credit Banks; and\nc. Federal Land Banks;\n3. Federal Home Loan Banks;\n4. Federal National Mortgage Association; and\n5. Tennessee Valley Authority obligations;\n(c) Collateralized or uncollateralized certificates of deposit, issued by banks rated\nin one (1) of the three (3) highest categories by a nationally recognized\nstatistical rating organization or other interest -bearing accounts in depository\ninstitutions chartered by this state or by the United States, except for shares in\nmutual savings banks;\n(d) Bankers acceptances for banks rated in the highest short -term category by a\nnationally recognized statistical rating organization;\n(e) Commercial paper rated in the highest short -term category by a nationally\nrecognized statistical rating organization;\n(f) Securities issued by a state or local government, or any instrumentality or\nagency thereof, in the United States, and rated in one (1) of the three (3)\nhighest long -term categories b y a nationally recognized statistical rating\norganization;\n(g) United States denominated corporate, Yankee, and Eurodollar securities,\nexcluding corporate stocks, issued by foreign and domestic issuers, including\nsovereign and supranational governments, ra ted in one (1) of the three (3)\nhighest long -term categories by a nationally recognized statistical rating\norganization;\n(h) Asset-backed securities rated in the highest category by a nationally\nrecognized statistical rating organization;\n(i) Shares of mutual funds, each of which shall have the following characteristics:\n1. The mutual fund shall be an open -end diversified investment company\nregistered under Federal Investment Company Act of 1940, as amended;\n2. The management company of the inv estment company shall have been\nin operation for at least five (5) years;\n3. The mutual fund shall be rated in the highest category by a nationally\nrecognized statistical rating organization;\n4. All of the securities in the mutual fund shall be eligible in vestments\npursuant to this section; and\n(j) State and local delinquent property tax claims which upon purchase shall\nbecome certificates of delinquency secured by interests in real property not to\nexceed twenty -five million dollars ($25,000,000) in the agg regate. For any\ncertificates of delinquency that have been exonerated pursuant to KRS\n132.220(5), the Department of Revenue shall offset the loss suffered by the\nFinance and Administration Cabinet against subsequent local distributions to\nthe affected taxing districts as shown on the certificate of delinquency.\n(10) The State Investment Commission shall promulgate administrative regulations for\nthe investment and reinvestment of state funds in shares of mutual funds, and the\nregulations shall specify:\n(a) The long and short term goals of any investment;\n(b) The specification of moneys to be invested;\n(c) The amount of funds which may be invested per instrument;\n(d) The qualifications of instruments; and\n(e) The acceptable maturity of investments.\n(11) Any in vestment in obligations and securities pursuant to subsection (9) of this\nsection shall satisfy this section if these obligations are subject to repurchase\nagreements, provided that delivery of these obligations is taken either directly or\nthrough an authorized custodian.\n(12) (a) Income earned from investments made pursuant to this section shall accrue to\nthe credit of the investment income account of the general fund, except that\ninterest from investments of excess cash in the road fund shall be credited to\nthe surplus account of the road fund and interest from investments of excess\ncash in the game and fish fund shall be credited to the game and fish fund,\ninterest earned from investments of imprest cash funds and funds in the trust\nand revolving fund for  each state public university shall be credited to the\nappropriate institutional account, and interest earned from the investment of\nfunds accumulated solely by means of contributions and gifts shall not be\ndiverted to any purpose other than that stipulate d by the donor, when the\ndonor shall have designated the use to which the interest shall be placed.\n(b) Except as otherwise provided by law, or by the obligations and covenants\ncontained in resolutions and trust indentures adopted or entered into for state\nbond issues, interest earned from the investment of moneys appropriated to\nthe capital construction accounts, trust and agency accounts, and trust and\nagency revolving accounts shall accrue to the capital construction investment\nincome account.\n(c) If there is a revenue shortfall, as defined in KRS 48.010, of five percent (5%)\nor less, the secretary of the Finance and Administration Cabinet, upon the\nrecommendation of the state budget director, may direct the transfer of excess\nunappropriated capital const ruction investment income to the general fund\ninvestment income account. The amount of the transfer shall not exceed the\namount of the shortfall in general fund revenues.\n(d) If the capital construction investment income is less than that amount\nappropriated by the General Assembly, the secretary of the Finance and\nAdministration Cabinet may, upon recommendation of the state budget\ndirector, direct the transfer of excess unappropriated general fund investment\nincome to the capital construction investment in come account. The transfer of\ngeneral fund investment income revenues to the capital construction\ninvestment income account shall be made only when the actual general fund\nrevenues are in excess of the enacted estimates under KRS 48.120 and shall be\nlimited to the amount of the excess general fund revenues. The amount of the\ntransfer shall not exceed the amount of the shortfall in the capital construction\nfund revenues.\n(13) The authority granted by this section to the State Investment Commission shall not\nextend to any funds that are specifically provided by law to be invested by some\nother officer or agency of the state government.\n(14) The authority granted by this section to the State Investment Commission shall only\nbe exercised pursuant to the administrative regulations mandated by KRS 42.525.\n(15) Each member of the State Investment Commission shall post bond for his or her\nacts or omissions as a member thereof identical in amount and kind to that posted\nby the State Treasurer.","path":["KRS Chapter 42"],"source_url":"https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=51389","current_through":"Includes enactments through the 2026 Regular Session","vintage":"09/05/2026","retrieved_at":"2026-09-05T20:49:02Z","sha256":"a5f2f9193522ff56847d24bebd740f8d1864442dec41c669f23be46a2877cde9","source_id":"us-ky","stale":false,"prev":"us-ky/krs-42.495","next":"us-ky/krs-42.505"},"notice":"GroundRules: Original legal text. Not legal advice."}