Division of Banking
Kenneth Boldt
Acting State Bank Commissioner	

	John W. Hickenlooper
	Governor

	Barbara J. Kelley
	Executive Director

March 20, 2014

STATE BANKING BOARD
RULE PDP3
PERTAINING TO TITLE 11, ARTICLE 10.5, SECTION 107(1)
COLORADO REVISED STATUTES

STATEMENT OF BASIS, PURPOSE AND SPECIFIC AUTHORITY

Statutory Basis

The Public Deposit Protection Act (PDPA), Title 11 Article 10.5, provides protection for public funds held on deposit at eligible public depositories. Due to a scrivener’s error, paragraph G of PDP3 includes a 50 percent limitation of certain securities. Without an emergency amendment to PDP3, the amount of public deposits that an eligible public depository may legally accept is reduced, and, in the event of an involuntary liquidation, the Federal Deposit Insurance Corporation’s deposit insurance coverage and PDPA coverage determinations may be adversely affected. The Colorado State Banking Board, pursuant to section 24-4-103(6), C.R.S. has an obvious and stated need to immediately adopt this rule and restore the status quo ante.

Specific Purpose of this Rulemaking

The specific purpose of this emergency rule is to correct a scrivener’s error that resulted in an inadvertent, substantive modification of PDP3.  The limitation that “[i]n no event shall an eligible public depository's pledged collateral portfolio consist of more than 50% of the above-described obligations” now found in paragraph G of PDP3 is being removed.  Additionally, the definition of eligible first lien mortgages or deeds of trust on 1-to-4 family residential real property is no longer incorporated by reference from FFIEC call report instructions, but is now explicitly stated in paragraph C.

Rulemaking Authority

Pursuant to sections 11-101-102, 11-102-104(1)(a), 11-10.5-102, 11-10.5-105, and 11‑10.5‑107, C.R.S., the Colorado State Banking Board shall have the authority to amend rules related to the Public Deposit Protection Act.