May 9, 1991
TO: STATE SECURITIES MEMBERS NO. 21-91
RE: COLORADO RECOMMENDS FUNDS DELAY SUBMITTING RENEWALS
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As you know, legislation was effective July 1, 1990 in
Colorado that completely revised the Colorado Securities Act and
included a blue chip exemption for qualified mutual funds and
unit trusts. The term of the blue chip exemption is twelve
months from the date the original notice and fee were filed with
the Division. Thereafter, an additional notice and fee are
required in order to claim the exemption. Last year, the
majority of funds claiming the blue chip exemption were granted
an effective date of July 1, 1990; thus, in order to continue to
rely on the blue chip exemption, an additional notice and fee are
due July 1, 1991.
However, please be advised that inasmuch as the Colorado
Securities Division may only collect in fees an amount equal to
its budget as set by the Legislature, the fee for claiming the
exemption and for registering securities must be adjusted
annually. Therefore, since the Division's fiscal year ends on
June 30 and the amount of its appropriation has not yet been
determined, the staff of the Division recommends that funds delay
submitting their renewals to claim the blue chip until the
exemption fee has been finalized. The staff of the Division
anticipates that the fees for fiscal year 1991-92 will be set by
mid-May.
In recognition of the fact that many funds submit their
renewal applications well in advance of the expiration of their
effectiveness, the staff has informed the Institute that it will
allow funds at least a thirty day grace period (i.e., to July 31,
1991) to submit their renewals. The effective date of all such
renewals will be retroactively granted a renewal date of July 1,
1991.
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We will keep you advised of developments.
Patricia Louie
Assistant General Counsel