                                 CODE OF VIRGINIA

INVESTMENT OF FUNDS OF COMMONWEALTH, POLITICAL SUBDIVISIONS, AND PUBLIC BODIES
IN &#8220;PRIME QUALITY&#8221; COMMERCIAL PAPER (§ 2.2-4502)

A. The Commonwealth, all public officers, municipal corporations, other
political subdivisions and all other public bodies of the Commonwealth may
invest any and all moneys belonging to them or within their control other than
sinking funds in &#8220;prime quality&#8221; commercial paper, with a maturity
of 270 days or less, of issuing corporations organized under the laws of the
United States, or of any state thereof including paper issued by banks and bank
holding companies. &#8220;Prime quality&#8221; means that the paper has received
at least two of the following ratings: (i) at least prime 1 by Moody&#8217;s
Investors Service, Inc.; (ii) at least A1 by Standard &#038; Poor&#8217;s; or
(iii) at least F1 by Fitch Ratings, Inc., provided that at the time of any such
investment:

   1. The issuing corporation, or its guarantor, has a net worth of at least $50
   million; and

   2. The net income of the issuing corporation, or its guarantor, has averaged
   $3 million per year for the previous five years; and

   3. All existing senior bonded indebtedness of the issuer, or its guarantor,
   has received at least two of the following ratings: (i) at least A by
   Moody&#8217;s Investors Service, Inc.; (ii) at least A by Standard &amp;
   Poor&#8217;s; or (iii) at least A by Fitch Ratings, Inc.
   				Not more than 35 percent of the total funds available for investment may
   be invested in commercial paper, and not more than five percent of the total
   funds available for investment may be invested in commercial paper of any one
   issuing corporation.

B. Notwithstanding subsection A, the Commonwealth, municipal corporations, and
other political subdivisions and public bodies of the Commonwealth may invest
any and all moneys belonging to them or within their control, except for sinking
funds, in commercial paper other than &#8220;prime quality&#8221; commercial
paper as defined in this section, provided that:

   1. Prior written approval is obtained from the governing board, committee, or
   other entity that determines investment policy. The Treasury Board shall be
   the governing body for the Commonwealth; and

   2. A written internal credit review justifying the creditworthiness of the
   issuing corporation is prepared in advance and made part of the purchase file.

HISTORY: 1973, c. 232, § 2.1-328.1; 1974, c. 295; 1976, c. 665; 1986, c. 170;
1987, c. 73; 1988, c. 834; 1992, c. 769; 2001, c. 844; 2020, c. 333.