HB121 Alabama 2022 Session

Updated Feb 26, 2026

Notable

Summary

Primary Sponsor: Danny GarrettRepresentative
Republican
Session: Regular Session 2022
Title: Counties and municipalities, investment of certain funds in commercial paper and banker's acceptances, authorized under certain conditions, Sec. 11-81-21 am'd.
Summary: HB121 would broaden Alabama local governments' investment options by allowing high-grade commercial paper and banker's acceptances, while banning investments in closed-end funds.
What This Bill Does
HB121 amends Section 11-81-21 to let municipal and county funds that are not needed for other purposes invest in commercial paper with the highest credit rating at purchase or in banker's acceptances. It also preserves existing allowed investments such as U.S. Treasury obligations, certain federal agency obligations, U.S. dollar deposits and certificates of deposit with qualified public depositories, and pre-refunded public obligations, with conditions. The bill prohibits investing municipal or county funds in closed-end management type investment companies. It also includes non-substantive technical revisions to update the language of the code.

Who It Affects
Municipalities and counties in Alabama (and the offices or agencies that manage their funds) would gain new investment options for funds not needed for other purposes, including high-grade commercial paper and banker's acceptances.
Banks, trust companies, savings associations, and investment managers that handle municipal or county funds would need to follow the new rules, including disclosing the fee basis when they charge investment-related fees.

Key Provisions
Adds authority for municipal funds and county funds to be invested in commercial paper with the highest credit rating at purchase.
Adds authority for municipal funds and county funds to be invested in banker's acceptances.
Prohibits investments of municipal or county funds in closed-end management type investment companies.
Retains existing allowed investments such as direct U.S. Treasury obligations, certain federal agency obligations, U.S. dollar deposits and certificates of deposit with qualified public depositories, and pre-refunded public obligations, with related safeguards.
Includes nonsubstantive technical updates to modernize the language and definitions in the code.

AI-generated summary using openai/gpt-5-nano on Feb 22, 2026. May contain errors — refer to the official bill text for accuracy.
Subjects: Local GovernmentBanks and Banking