(a)
For purposes of this section, “security” has the same meaning as defined in Section 25019 of the Corporations Code.
(b)
The Sacramento Municipal Utility District may operate a program under which the board of directors of the district may hold nonstock security in a corporation or other private entity if acquired as part of a procurement of goods or services from that entity, or as full or partial consideration for providing that entity services or access to district facilities, if separate funding is not expended solely for the nonstock security. The board of directors of the district may sell or otherwise dispose of the nonstock security when, in its judgment, it is in the best
interests of the district to do so.
(c)
Before exercising the authority described in subdivision (b), the district’s board of directors shall do all of the following:
(1)
Make all of the following findings:
(A)
The acquisition furthers the purposes of the district, pursuant to this division.
(B)
The acquisition is in the interest of the district’s ratepayers and the public.
(2)
Establish a policy governing acquisitions that includes, but is not limited to, all of the following:
(A)
Procedures for preventing conflicts of interest and
violations of Article 4 (commencing with Section 1090) of Chapter 1 of Division 4 of Title 1 of the Government Code.
(B)
Procedures for determining how much of an acquisition to accept in lieu of, or in addition to, other forms of remuneration, in order to ensure the district secures a reasonable return on any intellectual property or other resources it provides the private entity.
(C)
Procedures governing the approval process for accepting any acquisitions.
(D)
Procedures that ensure acquisition of a nonstock security does not unduly influence the amount paid for the associated goods and services.
(3)
Post the policy described in paragraph (2) on the
district’s internet website.
(4)
Adopt a resolution at a regular meeting of the board stating the intent of the board to exercise the authority described in subdivision (b).
(d)
The authority described in subdivision (b) shall be limited to a total of six acquisitions. Any profit or other gain earned by an acquisition shall be used to benefit the district’s ratepayers.
(e)
The value, at the time of acquisition, of any single nonstock security acquired pursuant to the authority described in subdivision (b) shall be limited to no more than 3 percent of the
district’s annual revenue in the fiscal year the district makes the acquisition.
(f)
This section shall remain in effect only until January 1, 2035, and as of that date is repealed.
