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  • Acts
  • 2009
  • Chapter 10 AN ACT EXTENDING THE COMMONWEALTH’S AUTHORITY TO GUARANTEE OBLIGATIONS OF THE MASSACHUSETTS TURNPIKE AUTHORITY.

Whereas, The deferred operation of this act would tend to defeat its purpose, which is to provide forthwith for the extension of the commonwealth’s authority to guarantee certain obligations of the Massachusetts Turnpike Authority, therefore it is hereby declared to be an emergency law, necessary for the immediate preservation of the public convenience.

Be it enacted by the Senate and House of Representatives in General Court assembled, and by the authority of the same as follows:

SECTION 1. Chapter 6 of the General Laws is hereby amended by striking out section 98, as appearing in section 3 of chapter 304 of the acts of 2008, and inserting in place thereof the following section:-

Section 98. (a) As used in this section, “state entities” shall mean the commonwealth, any quasi public entities, independent authorities or other state entities with responsibility for managing and overseeing public funds.

(b) The board shall promote transparency, public accountability and adherence to best practices by all state entities with respect to investments, borrowing or other financial transactions made or entered into by state entities and involving public funds. The board shall make an annual written report to the secretary of administration and finance, the state treasurer, the state auditor, the house and senate committees on ways and means and the senate and house committees on bonding, capital expenditures and state assets with respect to its findings regarding investments, borrowing and other financial transactions carried out by state entities and its activities to promote transparency, public accountability and best practices with respect thereto.

The board shall conduct a review, prior to the execution thereof, of any transaction relating to derivative financial products, proposed to be entered into by any state entities. All state entities shall submit to the board the terms of the proposed transaction and any supporting documents. The board shall complete its review of the proposed transaction and notify the submitting entity of its conclusions within a reasonable period of time after receiving the proposal. As used herein, the term “derivative financial products” shall mean financial instruments with values derived from or based upon the value of other assets or on the level of an interest rate index including, but not limited to, a call option on a bond, interest rate swaptions, caps, floors, collars, inverse floaters and auction rate securities; provided, however, that the term “derivative financial products” shall not include fixed-rate, long-term borrowing.

(c) In order to carry out its duty, the board may:

(1) adopt regulations or guidelines requiring state entities to report, adopt appropriate policies and adhere to best practices with respect to investments, borrowing and other financial transactions;
(2) make recommendations to state entities or state officers and propose legislative changes to improve the management of public funds;
(3) employ staff and engage professionals to review and advise it on financial transactions entered into by state entities; and
(4) conduct oversight hearings with respect to investment, borrowing and other financial transactions made or entered into by state entities.

SECTION 2. Clause (l) of section 4 of chapter 81A of the General Laws, as amended by section 7 of chapter 304 of the acts of 2008, is hereby amended by striking out the words “and the joint committee” and inserting in place thereof the following words:- and the senate and house committees.

SECTION 3. The first sentence of subsection (c) of section 26 of said chapter 304 is hereby amended by adding the following words:- ; provided, however, that the secretary of administration and finance shall consult with the state treasurer prior to extending credit support pursuant to this section.

SECTION 4. The third sentence of said subsection (c) of said section 26 of said chapter 304 is hereby amended by striking out the words “and the chairpersons of the joint committee” and inserting in place thereof the following words:- and the chairpersons of the senate and house committees.

SECTION 5. The fourth sentence of subsection (a) of section 27 of said chapter 304 is hereby amended by striking out the words “and the chairpersons of the joint committee” and inserting in place thereof the following words:- and the chairpersons of the senate and house committees.

SECTION 6.
Subsection (b) of said section 27 of said chapter 304 is hereby amended by striking out the words “and the chairpersons of the joint committee” and inserting in place thereof, in each instance, the following words:- and the chairpersons of the senate and house committees.

SECTION 7.
Section 27 of said chapter 304 is hereby amended by adding the following subsection:-
(c) Prior to taking any action authorized pursuant to this section, the secretary of administration and finance shall consult with the state treasurer.

SECTION 8.
Said chapter 304 is hereby amended by striking out section 32 and inserting in place thereof the following section:-
Section 32. Section 27 shall take effect as of October 1, 2008 and shall expire on June 30, 2009.

SECTION 9.
Section 8 of this act shall take effect as of January 15, 2009.

Approved April 24, 2009