HomeMy WebLinkAboutResolution 95-20
RESOLUTION NO. 95-20
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A RESOLUTION OF THE CITY OF OCOEE, FLORIDA,
REPEALING RESOLUTION NO. 86-2; ADOPTING IN
ACCORDANCE WITH SECTIONS 218.415, FLORIDA
STATUTES, A NEW WRITTEN INVESTMENT POLICY AND
PLAN FOR THE INVESTMENT OF THE CITY'S CASH
RESERVES, INCLUDING ANY CITY FUNDS IN EXCESS
OF THE AMOUNTS NEEDED TO MEET CURRENT
EXPENSES; PROVIDING FOR SEVERABILITY;
PROVIDING AN EFFECTIVE DATE.
WHEREAS, the City Commission of the City of Ocoee,
Florida has heretofore adopted Resolution Number 86-2 establishing
a formal investment policy for city funds; and
WHEREAS, the City Commission desires to repeal Resolution
No. 86-2 and adopt a new investment policy and plan for City funds
in order to assure that the City is in compliance with the
requirements of Section 218.415, Florida Statutes.
NOW, THEREFORE, BE IT ENACTED BY THE CITY COMMISSION OF
THE CITY OF OCOEE, FLORIDA, AS FOLLOWS:
SECTION 1. The City Commission of the City of Ocoee has
the authority to adopt this Resolution pursuant to Article VIII of
the Constitution of the State of Florida and Chapters 166 and 280,
Florida Statutes, and Section 218.415, Florida Statutes.
SECTION 2. Resolution Number 86-2, adopted February 5,
1986, is hereby repealed in its entirety.
SECTION 3.
The City Commission of the City of Ocoee
hereby adopts the following as the written investment policy and
plan of the City of Ocoee:
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See Exhibit II All attached hereto and by this
reference made a part hereof.
SECTION 4. Severability.
If any section, subsection,
sentence, clause, phrase or portion of this Resolution is for any
reason held invalid or unconstitutional by any court of competent
jurisdiction, such portion shall be deemed a separate, distinct and
independent provision and such holding shall not affect the
~ validity of the remaining portion hereto.
SECTION 5. Effective Date. This Resolution shall become
~
I
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effective immediately upon passage and adoption.
PASSED AND ADOPTED this /7iS day of D~ "NJBt;ol(
APPROVED:
ATTEST:
CITY OF OCOEE, FLORIDA
~~4~
. Scott Vandergrift ayor
Clerk
(SEAL)
, 1995.
FOR USE AND RELIANCE ONLY BY
THE CITY OF OCOEE, FLORIDA
APPROVED AS TO FO~ ~ LEGALITY
this U day of UL ivb-o-- , 1995.
APPROVED BY THE CITY OF OCOEE
COMMISSION AT A MEETING
HELD ON THE ABOVE DATE
UNDER AGENDA ITEM NO. :a: B
FOLEY &
L(jN~R ..
tfoJ/( ~
City Attorney
By:
C:\WP51\DOCS\OCOE\lNVESTME.RES 110/12/951 DEBBIEH 1 PER:dh
2
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EXHIBIT "A"
TO RESOLUTION NO. 95-20
CITY OF OCOEE
INVESTMENT POLICY AND PLAN
PURPOSE
The purpose of this policy is to set forth the policy and
objectives governing the investment management of the City's cash
reserves, including any public funds in excess of amounts needed by
the City to meet current expenses. The city recognizes that
liquidity needs must be met and has established cash flow
proj ections for the debt service funds, capital proj ect funds,
general operating funds and enterprise funds.
SCOPE
This investment policy applies to all the investment activity of
the city of Ocoee, except for its employees' pension funds which
are organized and administered separately.
Funds subject to this policy include:
- General Fund
Special Revenue Funds
Capital Project Funds
Enterprise Funds
Internal Service Funds
Debt Service Funds
Any new fund created by the City, unless specifically exempt at
its inception and/or by state statute or federal law.
Obiectives
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The primary objectives for the City's cash reserves are first,
protection and safety of the City's funds, second, provision for
liquidity, and third, maximized return on the portfolio but
minimized risk, in that order. The investment portfolio will
maintain sufficient liquidity to ensure cash availability for
operating cash flow requirements. Funds of the city will be
invested and handled in accordance with sections 166.261 and
218.415 and Chapter 280, Florida Statutes, this policy and City
Resolution 94-08.
DELEGATION OF AUTHORITY
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The Director of Administrative Services and Finance Manager are
designated as Investment Officers of the City and are responsible
for investment decisions and activities, under the direction of the
ci ty Manager. The daily administration of the cash management
program is handled by the Director of Administrative Services and
the Finance Manager. No person may engage in an investment
transaction except as provided under the terms of this policy and
the procedures so established. The City may appoint an outside
investment manager as "Agent" for the City's cash reserves.
positions authorized as investment signatories are City Manager,
Director of Administrative Services and Finance Manager. The
persons holding these positions are also authorized to initiate
wire transfers for the City in conformance with Resolution 94-08.
Investment transactions shall be approved by any two of the above
depositories signatories.
PRUDENCE AND ETHICAL STANDARDS
The level of prudence and ethical standards to be applied by the
investment officers shall be the "Prudent Person Rule" as it
appears in the Government Finance Officers Association's Committee
on Cash Management's Model Investment Legislation, which states:
"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 from the investment." The "Prudent Person Rule"
shall be applied in the context of managing the overall portfolio.
The investment officers and staff, acting in accordance with the
written procedures and exercising due diligence, shall not be held
personally responsible for a specific security's credit risk or
market price changes, provided that any changes in the credit risk
or market price are reported immediately to the Financial Advisors
and that appropriate action is taken to control adverse
developments.
INTERNAL CONTROLS
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The Director of Administrative Services and Finance Manager shall
establish and monitor internal and procedural controls designed to
protect the City's assets and ensure proper accounting and
reporting of the related transactions. Such controls shall include
but not be limited to the following:
* transfer of all funds (purchases, sales, etc) through a
central account only
* separation of functions including transaction authority
from accounting and record-keeping
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*
*
*
*
*
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custodial safekeeping
avoidance of bearer-form or non wireable securities
delegation of authority to staff members
written confirmation of telephone transactions
supervisory control of employee actions
specific guidelines regarding securities losses and
remedial action
documentation of transaction by investment officials
review of selected investment transactions by external
Auditors.
*
*
All securities purchased by and all collateral obtained by the City
shall be properly designated as an asset of the city.
All securities purchased will be transferred when possible only
under the "del i very versus payment" (D. V. P.) method but on all
securities sold on the "payment versus delivery" method to insure
that funds for securities are not released until all criteria
relating to the specific transaction are met.
The investment officers are authorized to accept, on the behalf of
and in the name of the city of Ocoee, bank trust receipts or
confirmations from a third party custodian in return for
investment of temporarily idle funds as evidence of actual delivery
of the obligations or securities. Any such trust receipt or
confirmation shall fully describe the various obligations or
securities held, together with the specific number of each
obligation or security held, and that they are held for the city in
the City's name. The actual obligations or securities, whether in
book entry or physical form, on which trust receipts or
confirmations are issued may be held by a bank jdepository
chartered by the united states Government or the state of Florida.
The internal controls set forth in this policy shall be reviewed by
the independent auditors of the City as part of any financial audit
periodically required of the city.
MONITORING AND ADJUSTING THE PORTFOLIO
The investment officers will routinely monitor the contents of the
portfolio, the available markets and the relative values of
competing instruments and will adjust the portfolio accordingly.
AUTHORIZED INSTITUTIONS AND DEALERS
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The city shall purchase securities only through qualified pUblic
depositories of the state of Florida as identified by the State
Treasurer, in accordance with Chapter 280 of the state statutes.
Repurchase agreements shall only be entered into with primary
securities dealers and financial institutions which are state
qualified public depositories.
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Before engaging in investment transactions with an institution, the
investment officers shall receive a signed certification form
attesting that the individual responsible for the City's account
with that firm has reviewed the City's investment policy and that
they agree to undertake reasonable efforts to preclude imprudent
transactions involving city funds or transactions in violation of
the City's investment policy.
SECURITY SELECTION PROCESS
When purchasing or selling securities, the investment officers
shall select the security which provides the highest rate of return
within the parameters of this policy and given the current
objectives and needs of the City's portfolio. These selections
shall be made utilizing one of the following methods:
1. Competitive bids, wherein the City solicits quotes from a
minimum of three firms.
2. comparison to the current market price as indicated by one of
the market pricing resources available to the city (such as
the City's financial advisors, the Wall street Journal, or a
comparable nationally recognized financial publication
providing daily market pricing.)
In most situations, the City shall utilize the competitive bid
process to select the securities to be purchased or sold.
Selection by comparison to a current market price, as indicated
above , shall be utilized when, in the judgement of the investment
staff, competitive bidding would inhibit the process to select the
securities to be purchased or sold.
AUTHORIZED INVESTMENTS AND MAXIMUM MATURITIES
Cash in Bank and cash reserves of the City of Ocoee may be invested
only in the following and for the maturities indicated:
1. U.S. Treasury Bills, Notes and Bonds
-with maturity dates within five years or less
2. Insured or fully collateralized Certificates of Deposit of
banks
-must be a state-certified pUblic funds depository in the
State of Florida, as defined in Section 280.02, Florida
Statutes
-maturities of three years or less
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3. Full faith or general faith and credit obligations of the
Uni ted States Government or united States Government Agency
Securities.
-maximum maturity shall be five years or less
-maximum portfolio mix shall not exceed 25% for these
instruments, inclusive of all types
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4. Repurchase Agreements
A. Term Repurchase Agreements collateralized by U. S.
Treasury Securities and market-to-market.
-purchased only from authorized dealers as provided
for in this policy
-any authorized institution with whom the City
transacts repurchase agreements must have on file
a fully executed copy of the city's Master
Repurchase Agreement
-must adhere to requirements of the city's Master
Repurchase Agreement
B. overnight (sweep) Repurchase Agreements collateralized
by full faith or general faith and credit obligations
of the united states Government or United states
Government Agency securities.
-purchased only from the City's contracted banking
service provider
-securities used as collateralization for the
overnight (sweep) Repurchase Agreement will be held
for the benefit of the city with a third party, the
Federal Reserve Bank or the contracted bank's
correspondent bank in an amount not less than 101%
of the overnight amount of the Repurchase Agreement
-any authorized institution with whom the city
transacts overnight (sweep) repurchase agreements
must have on file an executed copy of the city's
Master Repurchase Agreement for overnight
repurchases and an executed Sweep Investment
Service Agreement
-must adhere to requirements of the City's Master
Repurchase Agreement
5. State Board of Administration local government surplus
funds investment pool.
-portfolio mix shall not exceed 75% at anyone time
6. State Board of Administration intermediate term investment
pool.
7. Money Market Funds placed only with financial institutions
qualifying as public depositories as provided for in
chapter 280, Florida Statutes.
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8. Securities of, or other interests in, any open-end or
closed-end management type investment company or investment
trust registered under the Investment Company Act of 1940,
provided the portfolio of such investment company or
investment trust is limited to united States Government
obligations and to repurchase agreements fully
collateralized by such united States Government
obligations.
Investment in derivative products and the use of reverse repurchase
agreements or other forms of leverage is prohibited.
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To the extent possible, the investment officers shall attempt to
match investment maturities with known cash needs and anticipated
cash-flow requirements.
DEBT SERVICE REQUIREMENTS
Any debt service requirements or bond covenants will supersede this
investment policy.
EXISTING INVESTMENTS
Should any investments currently held not meet the guidelines of
this policy, said investments shall be exempted from the
requirements of this policy. At maturity or liquidation, such
monies so invested shall be reinvested only as provided for in this
policy.
DIVERSIFICATION. LIQUIDITY AND RISK
The investment officers shall diversify use of investment
instruments to avoid incurring unreasonable risks inherent in over
investing in specific instruments, individual financial
institutions or maturities. Diversification strategies shall be
determined and revised periodically by the investment officers.
Liquidity shall be assured through practices ensuring that funds
are readily available for current liabilities when due.
Minimizing credit risk will be accomplished by limiting the maximum
percentage that may be invested in anyone entity or instrument at
anyone time, as outlined in this policy.
ACCOUNTING METHOD
Investments will be carried at cost. Gains or losses from
investments will be credited or charged to investment income at the
time of sale. Premiums of discounts on securities may be amortized
over the life of the securities. The City shall comply with
Government Accounting Standards Board (GASB) requirements.
REPORTING
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The investment officers shall submit quarterly investment reports
to the city Commission that summarizes types of investments and
quarterly yield. The report shall include securities in the
portfolio by class or type, book value, income earned and market
value as of the report date. Such reports shall be available to
the public.