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56.863 Powers and duties of the commission.

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Page 1 of 2 56.863 Powers and duties of the commission. The commission shall have the power and duty to: <br>(1) Maintain the records and perform the functions necessary and proper to accomplish the purposes of KRS 56.860 to 56.869; (2) Promulgate administrative regulations relating to KRS 56.860 to 56.869; <br>(3) Conduct analysis to determine the impact of fluctuating receipts of revenues on the budget of the Commonwealth, fluctuating interest rates upon the interest-sensitive <br>assets and interest-sensitive liabilities of the Commonwealth, and the resulting <br>change in the net interest margin on the budget of the Commonwealth; (4) Develop strategies to mitigate the impact of fluctuating receipts of revenues on the budget of the Commonwealth and of fluctuating interest rates on the <br>Commonwealth's interest-sensitive assets and interest-sensitive liabilities; (5) Report its findings to the State Investment Commission at least annually to assist the State Investment Commission in developing and implementing its investment <br>strategy. The State Investment Commission shall provide the commission with a <br>copy of its monthly investment income report to aid the commission in developing <br>and implementing its strategies; (6) Issue funding notes, project notes, and tax and revenue anticipation notes or other obligations on behalf of any state agency to fund authorized projects or to satisfy <br>judgments; (7) Refund any funding notes, project notes, or tax and revenue anticipation notes issued under KRS 56.860 to 56.869 to achieve economic savings, to better match <br>receipts with expenditures, or as a part of a continuing finance program; (8) Designate individual employees or officers of the Office of Financial Management within the Office of the Controller as agents for purposes of approving the principal <br>amount of tax and revenue anticipation notes, the interest rate, the discount, <br>maturity date, and other relevant terms of tax and revenue anticipation notes, project <br>notes, and funding notes or refunding notes issued within constraints established by <br>the commission and to execute agreements, including notes and financial <br>agreements, for the commission; (9) Enter into financial agreements for the purpose of hedging its current or projected interest-sensitive assets and interest-sensitive liabilities to stabilize the <br>Commonwealth's net interest margin, as deemed necessary by the commission, <br>subject to administrative regulations promulgated by the commission that limit the <br>net exposure of the Commonwealth as a result of these financial agreements; (10) Deposit net interest payments and premiums received by the commission under financial agreements into a restricted account, which shall not lapse at the end of the <br>fiscal year but shall continue to accumulate to act as security for these financial <br>agreements. This duty is mandatory in nature. Any accumulated funds in excess of <br>the amount determined by the commission to be necessary to establish this security <br>may be applied to debt service payments, net interest payments, and premiums and <br>expenses related to interest-sensitive liabilities; and Page 2 of 2 (11) Report to the Capital Projects and Bond Oversight Committee and the Interim Joint Committee on Appropriations and Revenue on a semiannual basis, by September 30 <br>and March 31 of each year, the following: <br>(a) A description of the Commonwealth's investment and debt structure; <br>(b) The plan developed to mitigate the impact of fluctuating revenue receipts on the budget of the Commonwealth and fluctuating interest rates on the interest-<br>sensitive assets and interest-sensitive liabilities of the Commonwealth, <br>including an analysis of the impact that a change in the net interest margin <br>would have on the budget of the Commonwealth. The report due by March 31 <br>of each year shall reflect the strategy for January through June of the fiscal <br>year, and the report due by September 30 shall reflect the strategy for July <br>through December of the fiscal year; (c) The principal amount of notes issued, redeemed, and outstanding; and a description of all financial agreements entered into during the reporting <br>period. The report due by March 31 shall include information about <br>agreements entered into from July through December of the fiscal year. The <br>report due by September 30 shall include information about agreements <br>entered into between January and June of the prior fiscal year; and (d) A summary of gains and losses associated with financial agreements and any other cash flow strategies undertaken by the commission to mitigate the effect <br>of fluctuating interest rates during each reporting period. The report due by <br>March 31 shall include information about agreements and strategies entered <br>into or undertaken from July through December of the fiscal year. The report <br>due by September 30 shall include information about agreements and <br>strategies entered into or undertaken from January through June of the prior <br>fiscal year. Effective: June 20, 2005 <br>History: Amended 2005 Ky. Acts ch. 85, sec. 86, effective June 20, 2005. -- Amended 2004 Ky. Acts ch. 99, sec. 2, effective July 13, 2004. -- Amended 2000 Ky. Acts <br>ch. 46, sec. 22, effective July 14, 2000. -- Created 1997 (1st Extra. Sess.) Ky. Acts <br>ch. 4, sec. 5, effective May 30, 1997.