treasurer; qualified Arizona-based investment managers

SB1682 - 572R - I Ver

REFERENCE TITLE:
treasurer; qualified Arizona-based investment managers

State of Arizona

Senate

Fifty-seventh Legislature

Second Regular Session

2026

SB 1682

Introduced by

Senator
Carroll

AN
ACT

Amending sections 35-317 and 41-1504,
Arizona Revised Statutes; relating to state management of public monies.

(TEXT OF BILL BEGINS ON NEXT PAGE)

Be it enacted by the Legislature of the State of Arizona:

Section 1. Section 35-317, Arizona Revised
Statutes, is amended to read:

START_STATUTE
35-317.

State treasurer; duties; safekeeping of securities; interest;
exemptions; responsibilities; definition

A. The state treasurer is responsible for the
safekeeping of all securities acquired by
him
the state treasurer
under this article and those for which
he
the state treasurer
is the lawful
custodian.� Securities may be deposited for safekeeping with any bank eligible
to be the state servicing bank pursuant to section 35-315 or any trust
company or trust department of any bank qualified to do business in this state
, except not less than ten percent of trust and treasury monies shall
be invested with qualified arizona-based investment managers chosen from
a list that is maintained and updated by the arizona commerce authority
.

B. The state treasurer may at the expense of the
state enter into an agreement with any of those entities listed in subsection A
of this section or authorized by section 35-311, subsection E for the
safekeeping and handling of securities. The agreement shall be
entered into under terms and conditions
which
that
secure the proper safeguarding, inventory, withdrawal and
handling of the securities and lending of securities to the financial or dealer
community pursuant to section 35-313, subsection C.� Access to deposits
or withdrawals of the securities from any place of deposit selected by the
officers shall not be permitted or made except as the terms of the agreement
provide. The agreement need not require that securities be
physically located in this state, if the securities are represented by
safekeeping receipts issued for the account of the state treasurer by a federal
reserve bank or any bank located in a reserve city whose combined capital and
surplus on the date of the safekeeping receipt are
ten million
dollars
$10,000,000
or more.

C. The state treasurer shall regularly account for,
itemize and inventory according to general public fund accounting practices all
securities coming lawfully into
his
the
state treasurer's
possession.� Such practice shall be audited by the
auditor general at the time of the regular audit as prescribed by law.

D. When securities acquired under this article
mature and become due and payable, the state treasurer shall present them for
payment according to their terms and collect the monies payable on
them. The monies collected shall be treated as treasury monies
subject to reinvestment under the appropriate section of this article.

E. Interest and appreciation realized on any
investment authorized by this article shall be collected by the state treasurer
and credited by
him
the state treasurer

in accordance with general public fund accounting practices.

F. All interest realized on any investment of
treasury monies not otherwise apportioned by law shall be credited to the
general fund of this state.

G. The investment of treasury monies as provided in
this article is exempt from
the provisions of
section 35-142,
subsection B and sections 35-154, 35-181.01, 35-181.02, 35-182
,

through
35-183, 35-184
and
35-185, 35-185.01, 35-185.02, 35-186
,

through

35-187, 35-188,
35-189, 35-190 35-191,
35-192, 35-192.01,
35-192.02, 35-193, 35-193.02 and 41-732.

H. The state treasurer is responsible for the
safekeeping, management and disbursement of any investment made and any
interest received in compliance with this article.

i. for the purposes of this section,
"qualified arizona-based investment manager" means an
investment manager that is all of the following:

1. Has its global headquarters
located in this state.

2. Employs at least three employees
and at least two of whom work in this state.

3. Is not a wholly owned SUBSIDIARY
of or a sub-entity of an INSTITUTION that is not based in this state.

4. Has been in OPERATION for at least
three years.

5. Is registered with the appropriate
regulatory agency for the investment manager's ASSET class and manages a
minimum of $100,000,000 for investors other than this state or affiliates of
this state.

END_STATUTE

Sec. 2. Section 41-1504, Arizona Revised
Statutes, is amended to read:

START_STATUTE
41-1504.

Powers and duties; e-verify requirement

A. The board of directors, on behalf of the
authority, may:

1. Adopt and use a corporate seal.

2. Sue and be sued.

3. Enter into contracts as necessary to carry out
the purposes and requirements of this chapter, including intergovernmental
agreements pursuant to title 11, chapter 7, article 3 and interagency service
agreements as provided by section 35-148.

4. Lease real property and improvements to real
property for the purposes of the authority. Leases by the authority
are exempt from chapter 4, article 7 of this title, relating to management
of state properties.

5. Employ or retain legal counsel and other
consultants as necessary to carry out the purposes of the authority.

6. Develop and use written policies, procedures and
guidelines for the terms and conditions of employing officers and employees of
the authority and may include background checks of appropriate personnel.

B. The board of directors, on behalf of the
authority, shall:

1. Develop comprehensive long-range strategic
economic plans for this state and submit the plans to the governor.

2. Annually update a strategic economic plan for
submission to the governor.

3. Accept gifts, grants and loans and enter into
contracts and other transactions with any federal or state agency,
municipality, private organization or other source.

C. The authority shall:

1. Assess and collect fees for processing
applications and administering incentives.� The board shall adopt the manner of
computing the amount of each fee to be assessed.� Within thirty days after
proposing fees for adoption, the chief executive officer shall submit a
schedule of the fees for review by the joint legislative budget committee.� It
is the intent of the legislature that a fee shall not exceed one percent of the
amount of the incentive.

2. Determine and collect registry fees for the
administration of the allocation of federal tax exempt industrial development
bonds and student loan bonds authorized by the authority. Such
monies collected by the authority shall be deposited, pursuant to sections 35-146
and 35-147, in an application fees fund.� Monies in the fund shall be
used, subject to annual appropriation by the legislature, by the authority to
administer the allocations provided in this paragraph and are exempt from the
provisions of section 35-190 relating to the lapsing of appropriations.

3. Determine and collect security deposits for the
allocation, for the extension of allocations and for the difference between
allocations and principal amounts of federal tax exempt industrial development
bonds and student loan bonds authorized by the authority. Security
deposits forfeited to the authority shall be deposited in the state general
fund.

4. At the direction of the board, establish and
supervise the operations of full-time or part-time offices in other
states and foreign countries for the purpose of expanding direct investment and
export trade opportunities for businesses and industries in this state if,
based on objective research, the authority determines that the effort would be
beneficial to the economy of this state.

5. Establish a program by which entrepreneurs become
aware of permits, licenses or other authorizations needed to establish, expand
or operate in this state.

6. Post on its website on an annual basis a report
that contains at least the following information, and submit a copy to the
governor, the president of the senate and the speaker of the house of
representatives:

(a) The cumulative progress made toward its goals
for direct job creation, capital investment and higher average wages and the
estimated number of indirect jobs and induced jobs created as a result of the
work and the programs of the authority.

(b) To the extent not prohibited by law, information
on each incentive application approved by the authority in the fiscal year,
including the amount of the incentive approved or awarded and the applicant's
activity that is projected or has been achieved, whichever is applicable, to
qualify for the incentive.

(c) Rural economic development outreach and impact
data.

(d) Small business outreach and impact data.

7. Develop and implement written policies and
procedures relating to the administration of grants from the Arizona competes
fund established by section 41-1545.01, including the following elements:

(a) Procedures for documenting grantee selection and
due diligence.

(b) Procedures for verification of information
submitted by grantees.

(c) Procedures for evaluating requests to amend
grant terms and for documenting decisions relating to those requests.

8. Notwithstanding any other law, on request of the
office of economic opportunity, disclose to the office of economic opportunity
applicant information for incentives administered, in whole or in part, by the
authority. Any confidentiality requirements provided by law
applicable to the information disclosed pursuant to this paragraph apply to the
office of economic opportunity.

9. On or before December 31 of each year, compile
the data collected pursuant to subsection F of this section and submit a report
to the governor, the president of the senate, the speaker of the house of
representatives and the secretary of state.

10. Maintain and update a list of
qualified Arizona-based investment managers pursuant to section 35-317. Any
qualified arizona-based investment manager who wants to be included on
the list shall be added.

D. The authority, through the chief executive
officer, may:

1. Contract and incur obligations reasonably
necessary or desirable within the general scope of the authority's activities
and operations to enable the authority to adequately perform its duties.

2. Use monies, facilities or services to provide
matching contributions under federal or other programs that further the
objectives and programs of the authority.

3. Accept gifts, grants, matching monies or direct
payments from public or private agencies or private persons and enterprises for
the conduct of programs that are consistent with the general purposes and
objectives of this chapter.

4. Assess business fees for promotional services
provided to businesses that export products and services from this
state. The fees shall not exceed the actual costs of the services
provided.

5. Establish and maintain one or more accounts in
banks or other depositories, for public or private monies of the authority,
from which operational activities, including payroll, vendor and grant
payments, may be conducted. Individual funds that are established by
law under the jurisdiction of the authority may be maintained in separate
accounts in banks or other depositories, but shall not be commingled with any
other monies or funds of the authority.

E. The chief executive officer shall:

1. Hire employees and prescribe the terms and
conditions of their employment as necessary to carry out the purposes of the
authority. The board of directors shall adopt written policies,
procedures and guidelines, similar to those adopted by the department of
administration, regarding officer and employee compensation, observed holidays,
leave and reimbursement of travel expenses and health and accident
insurance. The officers and employees of the authority are exempt from
any laws regulating state employment, including:

(a) Chapter 4, articles 5 and 6 of this title,
relating to state service.

(b) Title 38, chapter 4, article 1 and chapter 5,
article 2, relating to state personnel compensation, leave and retirement.

(c) Title 38, chapter 4, article 2, relating to
reimbursement of state employee expenses.

(d) Title 38, chapter 4, article 4, relating to
health and accident insurance.

2. Maintain three full-time employees to serve as
advocates for small and rural businesses on economic development and regulatory
matters before cities, towns, counties or state agencies. Two of the
full-time employees shall be dedicated to small business growth, support
and regulation, one of whom shall serve as a small business ombudsman.� One of
the full-time employees shall be dedicated to rural economic development.

3. On a quarterly basis, provide public record data
in a manner prescribed by the department of administration related to the
authority's revenues and expenditures for inclusion in the comprehensive
database of receipts and expenditures of state monies pursuant to section 41-725.

F. On or before September 30 of each year, each
city, town and county in this state shall submit to the authority the city's,
town's or county's statistics for the preceding fiscal year that include all of
the following:

1. The average time from the submission of an
initial building permit application to a certificate of occupancy.

2. The average time from the submission of a zoning
application to zoning approval.

3. The average time from the submission of a final
plat to the recordation of the final plat.

4. Any other statistics as determined by the
authority or the municipality time frames advisory committee established by
section 41-1527 relating to municipal and county support for economic
development projects.

G. In addition to any
other requirement, in order to qualify for any grant, loan, reimbursement, tax
incentive or other economic development incentive pursuant to this chapter, an
applicant that is an employer must register with and participate in the
e-verify program in compliance with section 23-214. The
authority shall require verification of compliance with this subsection as part
of any application process.

H. Notwithstanding any other law, the authority is
subject to chapter 3.1, article 1 of this title, relating to risk management.

I. The authority is exempt from title 18, chapter 1,
articles 1 and 2, relating to statewide information technology. The
authority shall adopt policies, procedures and guidelines regarding information
technology.

J. The authority is exempt from state general
accounting and finance practices and rules adopted pursuant to chapter 4,
article 3 of this title, but the board shall adopt written accounting
practices, systems and procedures for the economic and efficient operation of
the authority. The authority shall adopt policies pursuant to this
subsection that prohibit using state monies as defined in section 35-321
to provide business executives lodging, alcoholic beverages, personal
transportation or tickets to entertainment events for the purposes of
attracting businesses to this state.

K. The authority is exempt from section 41-712,
relating to the installation and maintenance of telecommunication systems.

L. The authority may lease or purchase motor
vehicles for use by employees to conduct business activities. The
authority is exempt from section 28-472, relating to the state motor
vehicle fleet, and title 38, chapter 3, article 10, relating to vehicle usage
and markings.

M. Any tangible or intangible record submitted to or
compiled by the board or the authority in connection with its work, including
the award of monies, is subject to title 39, chapter 1, unless an applicant
shows, or the board or authority determines, that specific information meets
either of the following:

1. If made public, the information would divulge the
applicant's or potential applicant's trade secrets, as defined in section 44-401.

2. If made public, the information could potentially
harm the applicant's, the potential applicant's or this state's competitive
position relating to potential business development opportunities and
strategies.

N. The authority is exempt from chapter 25, article
1 of this title, relating to government competition with private enterprise.
END_STATUTE