Pursuant to section 120.745(5), Florida Statutes
ADMINISTRATION OF CERTAIN STATE FUND INVESTMENTS: ASSESSMENT FOR INVESTMENT
SERVICES
DEPARTMENT OF FINANCIAL SERVICES
DIVISION OF TREASURY
March 29, 2012

Section 17.29, Florida Statutes, provides the Chief Financial Officer (CFO) the authority to adopt rules to implement Chapter 17, Florida Statutes.
Section 215.535, Florida Statutes, created in 1981 and effective October 1, 1981, gave the State
Treasurer the power to invest all trust funds and agency funds formerly performed by the
Florida State Board of Administration. It also required the State Treasurer to make an annual assessment of .00005 against the average daily balance of moneys made available pursuant to section 215.535(3), Florida Statutes. The annual assessment was required to be used to cover the cost of administration and to be deposited in the General Revenue Fund. At that time, the estimated fiscal impact of the annual assessment of .00005 on state agencies/state funds was an increase of $80,000 to General Revenue. The statute also provided that the State Treasurer may adopt rules necessary to administer the section.
Currently, section 17.61(4)(b), Florida Statutes, mandates that the Chief Financial Officer make an annual assessment of 0.12 percent against the average daily balance of those moneys made available pursuant to section 17.61, Florida Statutes, and 0.2 percent against the average daily balance of those funds requiring investment in a separate account. The Department rule associated with this statutorily required annual assessment, 69C-3.007, F.A.C., describes how and when the assessments (based upon statutory rates cited above) will be made against the investment accounts. Citing section 17.61(4)(b), Florida Statutes, the rule provides that the proceeds from this assessment shall be deposited in the Treasury Administrative and
Investment Trust Fund. As required by statute, the annual assessment is used to defray the expense of the Chief Financial Officer’s office in the discharge of the administrative and investment powers and duties, including supplies, equipment, other materials, salaries, expenses of required personnel, and all other legitimate expenses related to the administrative and investment powers and duties imposed upon and charged to the CFO under Chapter 17,
Florida Statutes. The unencumbered balance in the trust fund at the close of each quarter shall not exceed $750,000. Any funds in excess of this amount shall be transferred unallocated to the
General Revenue Fund. However, fees received from deferred compensation participants pursuant to section 112.215, Florida Statutes, shall not be transferred to the General Revenue
Funds and shall be used to operate the deferred compensation program.
Over the last five fiscal years, $71.8 million in administrative fees have been assessed. During this time, $43 million was transferred unallocated to the General Revenue Fund for an average annual contribution of $8.6 million to the General Revenue Funds.

1.
Direct or indirect economic impact:
Likelihood of the regulatory cost, including transactional costs, of more than $1 million cumulatively over five years.
For the past five fiscal years, the administrative fees assessed pursuant to this rule averaged $14.4 million on an annual basis. It is almost a certainty that costs will continue to exceed $1 million over the next five fiscal years. Based on historical data, the final costs are expected to fall within a range of $14 - $16 million per fiscal year.
Over the last five fiscal years, $71.8 million in administrative fees have been assessed, in aggregate. During this same period, $43 million was transferred unallocated to the General Revenue Fund for an average annual contribution of
$8.6 million to the General Revenue Funds.
2.
Types and numbers of individuals or entities likely to be required to comply with this rule:
State agencies and participants in the Division of Treasury’s Special Purpose
Investment Pool (SPIA) are required to pay the annual assessment. SPIA participants may be any board, association, or entity created by the State
Constitution or by law, except for those excluded by statute. As of June 30, 2011, there were 26 state agencies and 70 SPIA participants subject to the annual assessment fee.
3.
Cost to the Division and other state or local governments to implement the rule and enforce the rule:
This rule is implemented and enforced by two positions within the Division of
Treasury at an annual cost totaling approximately $32,000.

4.
Effect on state or local revenues:
For the past five fiscal years, the administrative fees assessed pursuant to this rule averaged $14.4 million per fiscal year. Costs are expected to continue to exceed $1 million for each of the next five fiscal years. Based on historical data, the final costs over the next five fiscal years are expected to fall within a range of
$14 - $16 million per fiscal year.
Over the last five fiscal years, $71.8 million in administrative fees have been assessed. During this time, $43 million was transferred as unallocated revenues to the General Revenue Fund for an average of $8.6 million annual increase to
General Revenue Funds.
5.
Transactional costs:
There are no other costs other than those mentioned in 3 and 4 above.
6.
Impact on small business:
None.
7.
Impact on small counties and small cities:
An administrative fee is assessed to counties and cities participating in SPIA.
8.
Additional information:
There is no additional information. The positive impact of this rule is described in the justification section of this document.
The number of entities affected by this rule was determined using Treasury’s list of state agencies and SPIA participants with investment balances at June 30, 2011. The cost to each entity is calculated using the percentages in section 17.61(4)(b), Florida Statutes, and is assessed on the entity’s average daily investment balance. The assessment is charged on a monthly basis.