(1) Bonds of the United States or any of its agencies;

(2) Obligations guaranteed by the United States or any of its agencies, the payments of which are fully guaranteed both as to principal and interest by the United States;

(3) [Deleted by 2013 amendment, effective April 23, 2013.]

(4) Bonds of the state of Tennessee, including any revenue bond issued by any agency of the state specifically including institutions under the control of the state board of regents, the board of trustees of the University of Tennessee and bonds issued in the name of the state school bond authority;

(5) Bonds of any utility district, county or municipal corporation of the state of Tennessee, including bonds payable from revenues (expressly excluding bonds of any road, levee or drainage district) upon which such bonds there has been no default in the payment of interest more than thirty (30) days upon any one (1) installment of interest, for the five (5) years next preceding the deposit of such bonds;

(6) Loans to students guaranteed one hundred percent (100%) by the Tennessee student assistance corporation, during the dormant period of such loan;

(7) Bonds issued under title 7, chapters 37 and 53, or under title 48, chapter 101, part 3, that are rated “A” or higher by any nationally recognized rating service;

(8) In addition, the state treasurer, with the concurrence of the commissioners of finance and administration and of financial institutions, may accept any other collateral security which is acceptable to the secretary of the treasury to secure the United States for deposits of public money in tax and/or loan accounts;

(9) An irrevocable letter of credit issued by the federal home loan bank; provided, that:

(A) The federal home loan bank is rated investment grade by at least one (1) nationally recognized securities rating service; and

(B) The state treasurer may require the state depository to promptly pledge securities in lieu of the letter of credit if the state treasurer believes it necessary to protect public funds;

(10) A surety bond issued by an insurance company licensed under the laws of this state that meets the following:

(A)

(i) The company has a financial strength rating, also known as claims-paying ability, in one (1) of the two (2) highest categories by at least one (1) nationally recognized statistical rating agency; and

(ii) Any other financial or participation criteria and conditions established by the state funding board;

(B) The company offering the surety bond and the form of the bond is approved by the state funding board;

(C) The amount of surety bond pledged by any one (1) state depository or qualified public depository in lieu of other eligible collateral shall not exceed thirty million dollars ($30,000,000) or fifty percent (50%) of all collateral for that institution required to be pledged to the state treasurer or to the collateral pool, whichever is lower;

(D) The treasurer shall monitor the financial strength rating of a qualified insurance company no less than weekly, and at least annually shall file a report with the state funding board and the collateral pool board on the condition of the qualified insurance company. If the condition of an insurer changes to the extent that the issuer would no longer be qualified under the requirements of subdivision (10)(A), the treasurer shall immediately notify the state funding board and the collateral pool board; and the insurer shall thereafter become disqualified;

(E) In the event an insurer becomes disqualified under subdivision (10)(D), the state depository or qualified public depository using the insurer's surety bond shall be required within thirty (30) days' notice from the treasurer to substitute other eligible collateral or to otherwise meet the required collateral level;

(F) Notwithstanding the disqualification of an insurer under subdivisions (10)(D) and (E), the surety bond of the insurer shall remain in effect until its expiration, nonrenewal or termination as otherwise permitted by law;

(G) In addition to the authority otherwise provided in this section or by law, the state treasurer may require the state depository or qualified public depository to promptly pledge eligible collateral in lieu of the surety bond if the treasurer makes a finding that additional collateral is necessary to protect public funds;

(H) A surety bond authorized in this subdivision (10) may only be used to secure funds in the custody of the state treasurer or to secure funds covered by the collateral pool created under part 5 of this chapter; and

(I) In the event that an issuer of surety bonds desires to withdraw from the program or to terminate a surety bond, the bond issuer shall give the state treasurer and the insured state depository or qualified public depository no less than sixty (60) days' advance notice of the withdrawal, nonrenewal or cancellation of the bonds; or

(11) State or municipal bonds from other states or from municipalities in other states; provided, that:

(A) The bond meets the definition of “qualified tax-exempt obligation” as defined in Section 265(b)(3) of the Internal Revenue Code of 1986 (26 U.S.C. § 265(b)(3));

(B) The bond is rated AA-, Aa3, or a higher rating by a nationally recognized bond rating service;

(C) The bond is not a structured debt instrument; and

(D) If the bond is downgraded below the minimum rating, the state depository shall substitute other eligible collateral or otherwise meet the required collateral levels within two (2) working days.