It is enacted by the General Assembly as follows:

SECTION 1. Section 35-4-4.3 of the General Laws in Chapter 35-4 entitled "State Funds" is hereby amended to read as follows:

{ADD 35-4-4.3. Deposit of state funds. -- ADD} The state, its agencies and quasi-public authorities shall invest or hold funds on deposit, whether temporarily or permanently, only at federal {ADD ly ADD} insured and regulated banks that are deemed to be financially sound or in money funds offered by banks directly or through their affiliates or subsidiaries, according to state investment commission rules, regulations and guidelines and also in full compliance with the federal community reinvestment act (CRA). Initially, full compliance shall mean that the bank has been reviewed at least once by the appropriate federal regulatory authority and has achieved the "outstanding" or "satisfactory" rating for compliance at the time of its latest review. Should a bank's rating fall below "satisfactory", the state shall have a reasonable amount of time to withdraw its funds. After January 1, {DEL 1994 DEL} {ADD 1995 ADD} , preference will be given in the placement of state funds to those banks which have achieved a CRA rating of "outstanding". A system for determining said preference will be established in writing by the general treasurer after consultation with the State Investment Commission.

SECTION 2. This act shall take effect upon passage.