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Resolution No. 94-53 CITY OF TIGARD, OREGON RESOLUTION NO. 94-53 A RESOLUTION UPDATING THE INVESTMENT POLICY SET FORTH IN RESOLUTION 89-59 DATED JULY 24, 1989. Whereas, Ors 294.035 requires investment officers to obtain a written order from the governing body of a mu:iicipality before investing surplus funds, and Whereas, Resolution 89-59 dated July 24, 1989 established such a written order in the form of an investment policy, and Whereas, the City council desires to update the investment policy to provide more flexibility in the investment of public funds and to expand the scope of the policy to clearly _ elude water funds managed by the City for Durham, King City, and the Tigard Water District. NOW, THEREFORE BE IT RESOLVED by the Tigard City Council that: Section 1: The investment Policy is amended as indicated on attached Exhibit A. l PASSED: This 11�C day of 1994. John Sc wartz, Ma r ATTEST: 4f;!e� r, Cathy Wh tley Safekeenincr Certificates of Deposit will be placed in a secured area within the vault on the premises at the City of Tigazd. All bearer instruments, treasury and agency securities, and bankers acceptances shall be placed in safekeeping with a qualified third party. h:\word\invest.pol "EXHIBIT All CITY OF TIGARD INVESTWENT POLICY The following Investment Policies are intended to meet the requirements of ORS 294.035 and to provide the framework within which City of Tigard funds may be invested. Authority The Finance Director shall serve as the Investment Officer of the City. The investment officer is responsible to ensure that funds __e invested so as to make necessary cash available to meet current obligations and to invest excess cash i_� accordance with ORS 294.035 through ORS 2294.047 and these investment Policies. In the absence of the Finance Director, the Accounting Manager may act as Investment Officer with prior approval of the City Administrator. Scope These investment policies apply to all excess cash related to all activities and funds under the direction of the Tigard City Council includinci water funds on behalf of Durham Kinn City, and Tigard Wacer District. Cash accumulations related to bond proceeds or, short—term borrowing are included,unless more restrictive state or federal regulations are applicable. Excess cash shall be defined as all liquid assets not necessary to meet current obligations. Deferred Compensation Deferred compensation funds are placed with a third party for investment and are therefore <•xcluded from the restrictions set forth in these guidelines. Oblectives The objectives of these policies are to provide for the preservation of City assets, the availability of such assets to .—act obligations as they come due, and to provide for a reasonable rate of return on those assets, in that order, - Prudent Investor Investments shall be made under the prudent investors rule, which Ltates, "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." Internal Controls The investment off icer shall maintain a system of written internal controls, which will be reviewed annually by the independent auditor. Cash Flow Analysis The investment officer shall maintain a historical -:ash flow record and a cash flow projection which extend, twel.• me iths into the future. The projection shall be reviewer? ''-nd upda.ad on a regular basis. No fixed maturity securities sha__ be purchased unless the cash flow projection indicates that the funds invested will not be required until the maturity date of the investment. Bond Proceeds Surplus funds resulting from debt issuance shall be considered as a separate portfolio and shall not be restricted by the maturity and instrument diversification section of these policies. Such funds may be invested for periods exceeding 18 months and up to 36 months. Such maturities shall coincide with the projected cash flow needs resulting from the projected construction schedule. Such funds are restricted to the following instruments: Treasury/Agency Securities 90 percent maximum Local Government Investment Pool 100 percent maximum Diversification The investment officer will diversify the general portfolio to avoid unreasonable risks within the following parameters: • Maturity Diversification Investment maturities shall be scheduled to co-*ncide with projected cash flow needs. Tit majer! y300 of the portfolio will mature in less than 90 days. No investments will be made for a period to exceed 18 months_ • Instrument Diversification Certificates of Deposit 25% maximum Commercial Paper 25% maximum Bankers Acceptance 50€ maximum Treasury/Agency securities 75% G% maxizurid Local Government Investment Pool 100% maximum Demand Deposits 10% maximum Other Authorized Instruments 25% maximum Institution Diversification Bank liabilities with any one qualified financial institution shall not ey-eed 20 percent of the portfolio. Bank liabilities of any one qualified financial institution shall not exceed one percent of the institution's total assets. Investment in commercial paper shall not exceed 10 percent of the portfolio in any one Oregon corporate entity mee l g the rating requirements of P-2/1-2 or better, or five percent of the portfolio in any one corporate entity outside the State of Oregon Savings and loan institutions shall be distinguished from commercial banks in that Certificates of Deposit with savings and loan institutions shall not exceed $100,000 unless the excess is 100 percent collateralized by certificate in the State Collateral Pool. For purposes of these guidel___es, the state local government investment pool shall be considered to have a one day liquidity. Selection of Investment Instruments Investments shall be made by the investment officer through the exercise of his/her judgment after requesting quotes from financial institutions_ Selections will be made so as to provide the highest rate of return within the parameters of these policies. Qualified Institutions The investment officer shall maintain a list of all authorized institutions which are approved for investment purposes. The investment officer will request, analyze, and keep on file, periodic financial statements and related information to satisfy himself as to the creditworthiness of each institution on the approved list. Reporting The investment officer shall prepare an investment activity report at the end of each month for review by the City Administrator. Amendments. These investment policies may be amended at the request of the investment officer, the City Administrator, or members of City Council. Such amendments shall be approved by the City Council in the same manner as the investment policies. Authorized Investment Instruments The following investment instruments listed in ORS 294.035 as "approved securities.. ." shall be authorized investments for the City of Tigard. • Legally issued general obligations of the United States, its agencies and instrumentalities, and those of the states of Oregon, Washington, Idaho or California. • Time deposit open accounts, certificates of deposit, and savings accounts in banks, mutual savings banks, and savings and loan associations which maintain a head office or branch in the state of Oregon. • Trusts in which deferred compensation funds from other public employers are pooled. • Banker's acceptances that are guaranteed by a qualified financial_ institution. A qualified financial institution being one which is located in the state of Oregon licensed to do a banking business and not required under ORS 295.018 to maintain a reserve deposit of collateral for 110 percent of its public fund deposits. • Commercial paper issued by or on behalf of a qualified financial institution, a holding company owning a majority of such an _nstitutio n, .r a corporate entity having its headquarters in Oregon or employs 50 percent of its workforce in Oregon, or, has 50 percent of its tangible assets in Oregon. Commercial paper issued by a publicly held corporation organized under the laws of a state other than Oregon and that is rated P-1 or A-1. • Repurchase agreements involving legally issued general obligations of the United States and its agencies and instrumentalities. The seller must agree to repurchase the securities within 90 days following the date of the investment. I£ the maturity of the underlying security exceeds 18 months, the price paid shall not exceed 98 percent of the current market value Investment in repurchase agreements must be accompanied by a signed agreement with the seller and a confirmation including a full description of securities held in safekeeping.