Court Opinion

ID: 3464778
Source: CourtListenerOpinion
Date Created: 2016-07-05 20:29:29.454416+00
Date Added: 2024-06-11T12:49:08.327999
License: Public Domain

Dear Mr. Delahaye:
You have requested an opinion of the Attorney General regarding a Fiscal Agent Agreement currently being negotiated between the Iberville Parish Police Jury ("Police Jury") and various banks located in the parish. You state that Iberville Parish has a population of less than 100,000 and, as such, is generally exempt from the provisions of R.S. 39:1211 through39:1242, as provided for in R.S. 39:1217.1.
A question has arisen as to the minimum interest rate governing investments made by the Police Jury. In answer to your question, I refer you to R.S. 39:1217.1 which provides, in pertinent part, the following:
      "All funds under the control of such depositing authorities shall be placed in interest bearing accounts at an interest rate of not less than twenty-five percent below the discount treasury bill rate with regard to treasury bills of comparable maturity on deposit within the parish or municipality, in state banks, national banks or investments and obligations guaranteed by the federal government."
As can be seen from the above, state law requires depositing authorities, such as the Police Jury, with a population of less than 100,000, to place their funds in interest bearing accounts at an interest rate of not less than 25% below the discount treasury bill rate with regard to treasury bills of a comparable maturity.
However, once the Police Jury makes an administrative decision to invest these funds in other investment vehicles, the provisions of R.S. 33:2955 are applicable. Thus, for example, Section 2955(A)(d) authorizes the Police Jury to invest in time certificates of deposit. For those funds made available for this type of investment, the statute requires the rate of interest to be paid at not less than fifty basis points below the prevailing market interest rate on direct obligations of the United States Treasury with a similar length of maturity.
In summary, the interest rate provisions contained in R.S.39:1217.1 control relative to parish funds placed in interest bearing accounts, while the rates specified in R.S. 33:2955
control once these funds are moved to qualifying certificates of deposit.
Trusting this adequately responds to your inquiry, I am
Very truly yours,
 RICHARD P. IEYOUB ATTORNEY GENERAL
                              BY: ___________________________ ROBERT E. HARROUN, III Assistant Attorney General