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Home My WebLink AboutTC Res 1998-06-17 (4) -..------ " RESOLUTION N0.3285-A r-- A RESOLUTION OF THE TOWN COUNOL OF THE TOWN OF TIBURON ADOPTING A STATEMENT OF INVESTMENT POLICY FOR CALENDAR YEAR 1998 WHEREAS, State ofCa1ifomia Assembly Bill 1073, ChaPter 1226 amended Government Code Section 53646 (a) to require "The treasurer or chief fiscal officer shal1 annually render to the legislative body of the local agency a statem""t ofinvesunent policy." WHEREAS, State of Ca1ifomia Assembly Bill 1073 also requires monthly reporting of local agency investments, Government Code Section 53646 (b) provides that "The treasurer or chief fiscal officer shal1 render a monthly report to the chief executive officer and legislative body of the local agency showing the type of investment, institution, date of maturity, amount of deposit, rate of interest, and such data as may be required by the local agency." NOW, THEREFORE, BE IT RESOLVED that the Town Council of the Town of Tiburon does hereby adopt a revised Statement of Investment Policy (attached), and the Finance Director is directed to continue to submit a monthly invesunent summary statement to the Town Council. PASSED AND ADOPTED at a regular meeting of the Town Council of the Town of Tiburon on June 17, 1998, by the following vote: I""" AYES: NOES: ABSENT: COUNCIL MEMBERS: COUNCIL MEMBERS: COUNCIL MEMBERS: Bach, Gram, Hennessy, Metthews, Thompson None. None. -;AV1-G( S. /JIG-teL HARRY.MATTHEWS, MAYOR TOWN OF TlBURON ATlltfu DIANE L. CRANE TOWN CLERK r"' Replaces Tiburon Resolution No. 3207, February 1997. ..; J Town of Tiburon, Investment Policy Statement I""" I L PURPOSE This Policy sets forth the inveslment guidelines for the prudent management of all surplus funds of the Town of Tiburon, Tiburon Redevelopment AfI:DcY and TiburonPublic Facilities Financing Authority. It is the goal of this Policy to establish inveslmart objectives in accordance with the provisions of the Stale of California Government Code Sections 53600 et seq., and inveslmart policy guidelines to ensure that funds under its purview are prudently invested to preserve capita!, provide necessary liquidity and to achieve a rate of return consistent with the Town's needs and objectives. Investments may be made as authorized by this Investment Policy and subsequent revisions. This Statement of Investment Policy shall be reviewed annually by the Tiburon Town Council. The Town is therefure affirded a broad range of investment opportunities if the investment is deemed prudent and is allowable under current legislation of the State of California. I D. OBJECTIVES I"" The Town's cash management system is designed to accurately monitor and forecast revenues and expenditures, thus enabling the Town to invest these surplus funds to the fullest extent possible. Surplus funds sball be invested in accordance with sound treaswy management principles, State of California Government Code Sections 53600 et. seq, and this Policy. When investing, reinvesting, acquiring, selling and managing Town funds, objectives for selecting investments, in priority of order, are 1. sw. The primaIy objective sball be to safeguard the principal of the funds. The Town shall invest only in those investments considered safe. Investment in instnnnents and with institutions permitted under Section 5. Investment Guidelines, are deemed to constitute safe investments within the meaning of this Policy. 2. Lioniditv The secondary objective shall be to meet the liquidity needs of the Town. It is important that the portfolio contain investments that provide flexibility and may easily be sold with minimal risk of loss of principal or interest. 3. fuJlL. The third objective sball be to achieve a reasonable rate of return on the portfolio. The investment portfolio sball be designed to attain safety and liquidity of principal first, and thereafter attain a market rate of return that is consistent with portfolio design and Policy principles. r"' I m PRUDENCE Town Council Members, The Town Manager, Finance Director and Town Treasurer, and any persons authorized to make investment decisions on bebalf of the Town, are trustees and therefore fiduciaries subject to the Prudent Investor Standard. When investing, reinvesting, acquiring, selling and managing Town funds, a trustee sball act with care, skill, prudence and diligence under the circumstances then prevailing, that a prudent person acting in a like capacity and familiarity with those matters would use in the conduct of funds of a like character and with like aims to safeguard the principal and to maintain the liquidity needs of the Town (Government Code Section 53600.3) The Prudent Investor Standard sball be applied in managing an overall portfolio. Investment officers acting in accordance with written procedures and the Investment Policy and exercising due diligence sball be relieved of personal responsibility for a particular security's credit risk or market price changes, provided deviations from expectations are reported in a timely fashion and appropriate action is taken to control developments. I IV. DELEGATION OF AUTIlORITY Authority to manage the Town's investment program is derived from approval of Town Council. Management responsibility for the Town's cash management systems and investments are delegated to the Town Manager and Finance DirectDr. No person may engage in an investment transaction except as provided under the teIIns of this Investment Policy Statement and procedures established by the Town Council. IV. INVESTMENT GUIDELINES Investments are to be made in high quality securities or instruments as permitted by the Government Code and subject to the Limitations of this Investment Policy. A. Eligible securities for investment sball include the following: 1. U.S. Treasurv Securities. Uuited States Treasury notes, bonds, strips, bills or certificates of indebtedness, or obligations for which the full faith and credit of the U.S. Government are pledged for the timely payment of principle and interest. 2. Federa) Allencies and II S Government Snonsored Rnteq>ri""-" Obligations, participations, or other instnnnents of or issued by a federal agency or federal government sponsored enterprise. This includes, and is not restricted to, obligations of the: Federal Home Loan Bank (FHLB), Federal Home Loan Mortgage Corporation (FHLMC), Federal National Mortgage Association (FNMA), Federal Farm Credit Bank (FFCB), Government National Mortgage Association (GNMA), Small Business Administration (SBA), Export- lmpooBankofthe United States, and the U.S. Department of Housing and Urban Development (HUD). 1 .~ Town of Tiburon, Investment Policy Statement I""" 3. Stale of California and Local AlleIlCV Oblillations. Registered Stale warrants, Treasury notes, or bonds of the State of California, and bonds, notes, warrants or other evidence of indebtedness of any local agency of the Stale (including bonds payable solely out of revenues from a revenue producing property or asset owned, controlled, or operated by the State or local agency, or by a department, board, agency or authority of the State or local agency.) Such obligations must be rated AI, SP-I, its equivalent or higher short term, or "A" or higher long term, by a nationaJly recognized rating agency. 4. Cornmereial Paner. Commercial paper oC.prime" quality rated AIII' I or higher by Moody's Investor Services, Inc. Or Standard & Poor's Corporation. Eligible paper is further limited to issuing corporations that: (a) are organized withing the United States, (b) have total assets in excess of five hundred million dollars ($500,000,000), and have a long tenn debt rating of" A" or higher. I""" 5. NellOtiable Certificates of Deoosit. Negotiable certificates of deposit issued by a nationally or state-chartered bank or savings association, or federal association, or a state or federal credit union, or by a state-licensed branch of a foreign bank canying an individnal rating of at least BlC by the Thompson Bank Watch or mCA rating services, a short term debt rating of AIII' I or higher, and a long tenn debt rating of "A" or higher. 6 Monev Market Foods. Shares of beneficial interest issued by diversified management companies as authorized by California Government Code Section 536350). B. State Local Agency Investment Food (LAlF). The Town may invest all or a portion of its investments, up to the State-mandated maximum, in LAIF pursuant to California Government Section 16429.1. C. Diversity and Maturity Guidelines: r"' Maximum Maximum %of % of one Maximum Tvne of Investment Portfolio Issuer Maturitv U.S. Treaswy Securities 100 100 5 years Federal Agencies and 65 20 5 years U.S. GSEs Commercial Paper 15 5 180 days Negotiable Certificates 25 5 3 years of Deposit Money Market Foods 15 15 N/A State LAIF 100 100 N/A * VL REPORTING Within thirty (30) days following the end of each quarter Staff shall render a report to the Town Cooocil, which shall include the following information I. A portfolio appraisal that includes the type of . investment, issuer" date of maturity, par and dollar amooot invested for all securities and investments of the Town, and sha11 additionally include a description of any Town monies that are under the management of any outside parties. 2. The current market value, as of the report date, of all investments, as well as the source of this same valuation. 3. A statement of the status of the compliance (or non- compliance) of the portfolio to this Investment Policy Statement. 4. A statement denoting the ability (or inability)ofthe Town to meet its expenditure requirements for the next six (6) months. For investments placed in LAIF, a bank, or savings and loan association, the most recent statements received by the Town from the institution may suffice in lieu of the requirements listed above. I VII. SAFEKEEPING AND DELIVERY OF SECURITIES All transactions sha11 be executed on a Deliver versus Payment (DVP) basis. To protect against potential fraud or embezzlement, the assets of the Town shall be held in safekeeping by the Town's safe keeping agent, or secured through third-party custody and safekeeping procedures pursuant to the limitations set forth in Government Code Section 53608. These procedures will be reviewed annually by an external auditor. All investments are to be held in the name of the Town of Tiburon. Adopted at a regular meeting of the Town Council of the Town ofTiburon, June 17,1998 2