3824.03.02  GROUP II FUNDS

Group II funds may be invested utilizing:

	1.	The Surplus Money Investment Fund.

	2.	Banks and savings and loan associations;  however, compliance 
		with SAM sections 19462 and 19463 must be maintained.  (These 
		sections require that accounts must be insured or collaterized 
		and reports must be submitted to the Treasurer at the time of 
		deposit or purchase and with year-end financial statements.)

	3.	Purchase of any of the securities authorized for investment by 
		Section 16430 of the Government Code, or investment by the 
		State Treasurer in those securities.  A handbook prepared by the 
		First Boston Corporation, Investment Bankers, 20 Exchange 
		Place, New York, New York 10005, which describes various 
		federal government securities and related money market 	
		instruments, may be obtained if more information is needed 
		than is provided in Section 16430 of the Government Code.