(a) A public entity may contract with a bank that has its main office or a branch office in this state to secure a deposit of public funds.
(b) The contract may contain a term or condition relating to an investment security used as security for a deposit of public funds, including a term or condition relating to the:
(1) possession of the collateral;
(2) substitution or release of an investment security;
(3) ownership of the investment securities of the bank used to secure a deposit of public funds; and
(4) method by which an investment security used to secure a deposit of public funds is valued.