HomeMy WebLinkAboutResolution 144-93 RESOLUTION NO. 144-93
A RESOLUTION OF THE CITY COUNCIL
OF THE CITY OF ATASCADERO
TO ADOPT ITS ANNUAL INVESTMENT POLICY
WHEREAS, The City of Atascadero was required by state law to adopt an
Annual City Investment Policy for idle funds; and
WHEREAS, To maintain consistency and in accordance with Section 10.0 of
the previous policy set forth in Resolution No. 126-92; and
WHEREAS, It is the responsibility of the City Treasurer to propose such a
policy as well as it is an indication of good business sense and prudent practice.
NOW, THEREFORE BE IT RESOLVED that the City Council of the City of
Atascadero does re-adopt the attached Investment Policy (Exhibit "A") to be
followed by the City Treasurer in the investment of the City's idle funds.
On Motion by Councilmember Luna, seconded by Councilmember Bewley,
the foregoing resolution is hereby adopted on the following roll-call vote:
AYES: Councilmembers Borgeson, Bewley, Luna and Mayor Nimmo
NOES: None
ABSENT: One (1) Seat Vacant
ADOPTED: December 14, 1993
ATTEST CITY OF ATASCADERO
By:
LEE R BOIN, City dlerk ROBERT P. NIMMO, Mayor
APPROVED AS TO FORM:
AR tHEb R_ ON, City Attorney
APPROVED AS TO CONTENT:
MURIEL C. KORBA, City Treasurer
Resolution No. 144-93
EXHIBIT "A"
Page 1
CITY OF ATASCADERO
STATEMENT OF INVESTMENT POLICY
1 .0 POLICY
It is the policy of the City of Atascadero to invest public funds in a manner
which will provide the highest investment return with the maximum security while
meeting the daily cash flow demands of the City of Atascadero and conforming to
all state, county and local statutes governing the investment of public funds --
safety, liquidity, and yield (SLY).
2.0 SCOPE
This investment policy applies to all financial assets of the City of
Atascadero. These funds are accounted for in the City of Atascadero's
Comprehensive Annual Financial Report and include:
2.1 Funds
2.1 .1 General Fund
2.1 .2 Special Revenue Funds
2.1 .3 Capital Project Funds
2.1 .4 Enterprise Funds
2.1 .5 Trust and Agency Funds
2.1 .6 Retirement/Pension Funds
2.1 .7 Any new funds unless specifically exempted.
3.0 PRUDENCE - Civil Code #2261
Investments shall be made with judgment and care -- under circumstances
then prevailing -- which persons of prudence, discretion and intelligence exercise in
the management of their own affairs, not for speculation, but for investment,
considering the probable safety of their capital as well as the probable income to
be derived.
3.1 The standard of prudence to be used by investment officials shall be the
"prudent person" standard and shall be applied in the context of managing an
overall portfolio. Investment officers acting in accordance with written procedures
and the investment policy and exercising due diligence shall be relieved of personal
responsibility for an individual 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 adverse developments.
Resolution No. 144-93
EXHIBIT "A"
Page 2
4.0 DELEGATION OF AUTHORITY - Per Government Code #53607
4.1 All solicitations for investments shall be made to and through the City
Treasurer.
4.2 All brokers/dealers must have an application on file that has been previously
approved before any investment can be made through them.
4.3 Two signatures shall be required for any purchase of C.D.'s or other type of
investment, except LAIF and Orange Co. Investment Pool. The two signatures
shall be that of City Treasurer and Finance Director. If the latter is unavailable, the
City Manager may substitute.
4.4 Any out-of-state investment shall require consultation with and approval of
the City Attorney. State laws differ and additional requirements may be
appropriate for the safety of any investment.
5.0 REPORTING
5.1 The Treasurer shall submit a monthly investment report to the City Council
This report will include all required elements of the monthly report as prescribed by
California Government Code Section 41001 .
Required elements of the monthly report:
5.1 .1 Type of Investment
5.1 .2 Institution
5.1 .3 Date of Maturity
5.1 .4 Amount of Deposit or Cost of the Security
5.1 .5 Current market value of securities with maturity in
excess of 12 months.
5.1 .6 Rate of Interest
5.1 .7 Statement relating the report to the Statement of Investment
Policy.
5.1 .8 Statement that there are sufficient funds to meet the next 30
days' obligations.
5.1 .9 Effective January 1, 1991 accrued Interest as prescribed by the
California Government Code Section 53646.
Resolution No. 144-93
EXHIBIT "A"
Page 3
6.0 SAFEKEEPING AND CUSTODY
All security transactions, including collateral for repurchase agreements,
entered into by the City of Atascadero shall be conducted on a delivery - versus -
payment (DVP) basis. Securities will be held by a third party custodian designated
by the Treasurer and evidenced by safekeeping receipts.
7.0 DIVERSIFICATION:
The City of Atascadero will diversify its investments by security type and
institution. With the exceptions of U.S. Treasury securities and authorized pools --
such as the State LAIF and Orange County Agency Investment Fund -- no more
than 10% of the City of Atascadero's total investment portfolio will be invested in
a single security type or with a single financial institution.
7.1 Permitted investments/deposits
Securities of the U.S. Government
Certificates of Deposits
Negotiable Certificates of Deposit
Bankers Acceptances
Commercial Paper
Local Agency Investment Fund (State Pool)
County Agency Investment Fund
Passbook Deposits
Repurchase Agreement
Reverse Repurchase Agreements
7.2 Competitive Bids-Purchase and sale of securities should be made on the basis
of competitive offers and bids when practical.
7.3 Purchases shall be made only with corporations in a rating category of "A" or
its equivalent or better by a nationally recognized rating service.
8.0 MAXIMUM MATURITIES
To the extent possible, the City of Atascadero will attempt to match its
investments with anticipated cash flow requirements. Unless matched to a
specific cash flow, the City of Atascadero will not directly invest in securities
maturing more than 2 years from the date of purchase.
Resolution No. 144-93
EXHIBIT "A"
Page 4'
9.0 INTERNAL CONTROL
9.1 A system of internal control shall be established and documented in writing.
The controls shall be designed to prevent losses of public funds arising from fraud,
employee error, misrepresentation of third parties, unanticipated changes in
financial markets, or imprudent actions by employees and officers of the City of
Atascadero. Controls deemed most important include: control of collusion,
separation of duties, separating transaction authority from accounting and record-
keeping, custodial safekeeping, clear delegation of authority, specific limitations
regarding securities; losses and remedial action, written confirmation of telephone
transactions, minimizing the number of authorized Investment Officials,
documentation of transactions and strategies, and code of ethics standards.
10.0 STATEMENT OF INVESTMENT POLICY
The Statement of Investment Policy shall be reviewed and submitted
annually to the City Council of the City of Atascadero, State of California.
MURIEL C. KORBA, City Treasurer
City of Atascadero