Relating to the investment of public funds by a local government in investment pools.

HB 5260 requires Texas local governments (such as cities and counties) to invest public funds only in investment pools managed by the state comptroller or the Texas Treasury Safekeeping Trust Company. It mandates that local governments remove all funds from non-compliant pools within 360 days, with at least half withdrawn within 180 days of discovery. Local governments may delay divestment only if they provide documented evidence that selling would cause financial loss, and must report their justification to state officials. This bill directly affects all local entities managing public investments, centralizing oversight under state-managed pools.