Amends TCA Title 9, Chapter 4.

This bill revises various provisions regarding eligible collateral and the collateral pool board, as follows: (1) Under present law, "eligible collateral" includes bonds of the United States or any of its agencies. This bill revises this provision to instead include as eligible collateral, bonds, notes, and treasury bills of the United States or other obligations guaranteed as to principal and interest by the United States or any of its agencies; (2) Under present law, "eligible collateral" also includes obligations guaranteed by the United States or any of its agencies, the payments of which are fully guaranteed both as to principal and interest by the United States. This bill revises this provision to instead include obligations guaranteed as to principal and interest by the federal home loan mortgage corporation, federal national mortgage association, student loan marketing association, and other United States government-sponsored corporations; (3) Under present law, "eligible collateral" also includes state or municipal bonds from other states or from municipalities in other states, if the bonds meet certain requirements. One such requirement is that the bond meet the definition of “qualified tax-exempt obligation” under federal law; this bill removes this requirement; (4) Under present law, "eligible collateral" also includes loans to students guaranteed 100 percent by the Tennessee student assistance corporation, during the dormant period of such loan; this bill removes such loans from the list of eligible collateral; (5) This bill adds bonds of the small business administration to the list of eligible collateral; (6) This bill specifies that it is within the state treasurer's discretion to accept or decline certain forms of eligible collateral; (7) This bill specifies that the collateral pool board's rulemaking authority specifically includes authority to promulgate rules to increase or decrease collateral pledge levels, except as otherwise provided in the Collateral Pool for Public Deposits Act; (9) This bill authorizes the collateral pool board to admit public depositories for participation in the collateral pool and to delegate the board's duties to the state treasurer as the board deems appropriate. In exercising such delegation, the state treasurer will be authorized to exercise such powers as are vested in the board that are necessary to fulfill the delegated duties and responsibilities, and may assign any such duties and responsibilities to the state treasurer's staff as the state treasurer deems necessary and proper. This bill also authorizes the board to revise the benchmark levels to be less stringent upon applicants; and (10) This bill authorizes the collateral pool board to make temporary changes to the required collateral and collateral pledge levels contained in the board's rules, including, but not limited to, the qualitative and quantitative standards for determining collateral pledge levels and the admission criteria, if certain conditions (specified in the bill) are met, which include public notice. This bill specifies that the board must make a determination, to be included in the minutes of the meeting, that exigent circumstances exist to necessitate a change in the required collateral or collateral pledge levels. Such changes approved by the board must be made on a defined temporary basis. Once the changes expire, the required collateral and collateral pledge levels, including, but not limited to, the qualitative and quantitative standards for collateral pledge levels, and the admission criteria, must revert to the standards contained in the board's rules.