TX SB404

Local governments would be restricted to investing public funds only in investment pools managed by the Texas Comptroller or the Texas Treasury Safekeeping Trust Company

Local governments with funds in non-qualifying "restricted investment pools" must divest at least 50% within 180 days of discovery and 100% within 360 days

Divestment may be delayed if clear and convincing evidence shows it would result in a loss in value or benchmark deviation, but local governments must report justification to legislative presiding officers, the attorney general, and comptroller every six months

The restrictions apply only to contracts entered into on or after September 1, 2025; existing contracts remain governed by prior law