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<br />I <br /> <br />Minnesota Statutes 2001, II8A.03 <br /> <br />Page] of2 <br /> <br />Minnesota~tat!ltes 2QQl~t!lpk..Qf Cl:1gpter~ <br /> <br />Tqbl~9f content~.JorJ::hallj.er 13 8A <br /> <br />IlSA.03 When and what collateral required. <br /> <br />Subdivision 1. To the extent that funds deposited are in <br />excess of available federal deposit insurance, the government <br />entity shall require the financial institution to furnish <br />collateral security or a corporate surety bond executed by a <br />company authorized to do business in the state. <br /> <br />Subd. 2. <br />the allowable <br />bond, <br /> <br />In lieu of surety bond. The following are <br />forms of collateral in lieu of a corporate surety <br /> <br />(1) United States government treasury bills, treasury <br />notes, treasury bonds; <br /> <br />(2) issues of United States government agencies and <br />instrumentalities as quoted by a recognized industry quotation <br />service available to the government entity; <br /> <br />(3) general obligation securities of any state or local <br />government with taxing powers which is rated HAil or better by a <br />national bond rating service, or revenue obligation securities <br />of any state or local government with taxing powers which is <br />rated 11M" or better by a national bond rating service; <br /> <br />(4) irrevocable standby letters of credit issued by Federal <br />Home Loan Banks ta a municipality accompanied by written <br />evidence that the bank I s public debt is rated "MII or better by <br />Moody's Investors Service, Inc" or Standard &> Poarls <br />Corporation; and <br /> <br />(5) time deposits that are fully insured by the Federal <br />Deposit Insurance Corporation. <br /> <br />Subd. 3. Amount. The total amount of the collateral <br />computed at its market value shall be at least ten percent more <br />than the amount on deposit plus accrued interest at the close of <br />the business day. The financial institution may furnish both a <br />surety bond and collateral aggregating the required amount. <br /> <br />Subd. 4. Assignment. Any collateral pledged shall be <br />accompanied by a written assignment to the government entity <br />from the financial institution. The written assignment shall <br />recite that, upon default, the financial institution shall <br />release to the government entity on demand, tree of exchange or <br />any other charges, the collateral pledged. Interest earned on <br />assigned collateral will be remitted to the financial <br />institution so long as it is not in default. The government <br />entity may sell the collateral to recover the amount due. Any <br />surplus from the sale of the collateral shall be payable to the <br />financial institution} its assigns, or both. <br /> <br />. <br /> <br />Subd. 5. Withdrawal of excess collateral. A <br />financial institution may withdraw excess collateral or <br /> <br />hUr:! /www.revisor.leg.state.mn.us/stats/l]8N03.html <br /> <br />9/13/2002 <br />