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HomeMy Public PortalAboutResolution - 02-05- 20020116 - Annual Investment Policy RESOLUTION NO. 02-05 RESOLUTION OF THE BOARD OF DIRECTORS OF THE MIDPENINSULA REGIONAL OPEN SPACE DISTRICT ADOPTING A STATEMENT OF INVESTMENT POLICY AND AUTHORIZING THE CONTROLLER TO INVEST SURPLUS FUNDS ALLOWED BY GOVERNMENT CODE WHEREAS, the District needs to maximize the yield on surplus temporarily idle funds in order to help meet land acquisition objectives; and WHEREAS, Chapter 4, Division 2 of Title 5 of the Government Code authorizes the District to deposit and invest surplus funds in investments which, at times, yield interest rates higher than achievable through the Santa Clara County Pooled Fund, or the California Pooled Investment Authority; and WHEREAS, the District can often improve its yield on surplus funds without sacrificing financial safety flexibility. NOW, THEREFORE, BE IT RESOLVED AS FOLLOWS: Section One. The Board of Directors of the Midpeninsula Regional Open Space District does hereby authorize the Controller to invest surplus or temporarily idle funds according to the Investment Goals and Guidelines attached hereto as Exhibit "A" and by reference made a part hereof. Section Two. Before any particular investments the Controller shall consult with the General Manager, or a District employee authorized to act in his/her behalf, to determine anticipated cash flow needs of the District. Section Three. This Resolution supersedes Resolution No. 00-03 adopted January 12, 2000. This Resolution shall no longer be in effect as of January 15, 2003, unless extended in time, and inactive funds shall then be deposited in the Santa Clara County Pooled Investment Fund, with the California Pooled Investment Authority, or invested through the District's bank. RESOLUTION No. 02-05 PASSED AND ADOPTED by the Board of Directors of the Midpeninsula Regional Open Space District on January 16, 2002, at a regular meeting thereof, by the following vote: AYES: D. LittQe, L. Ha�s�sett, N. Nanko, M. Davey, J. Cyt, P. Siemen'5, K. N.itz NOES: none ABSTAIN: none ABSENT: none ATTEST: APPROVED: Secreta President Boar of Directors Board of Directors I, the District Clerk of the Midpeninsula Regional Open Space District, hereby certify that the above is a true and correct copy of a resolution duly adopted by the Board of Directors of the Midpeninsula Regional Open Space District by the above vote at a meeting thereof duly held and called on the above day. Distn Jerk EXHIBIT"A" INVESTMENT GOALS AND GuilDELINES GOALS Goal 1. Capital Preservation The primary goal shall be to safeguard the principal of invested funds. Temporarily idle funds shall be invested in a conservative manner, such that funds can always be withdrawn at,or just above or below,full invested value. Investments that offer opportunities for significant capital gams and losses are excluded. Goal 2. Liquidity Temporarily idle funds will be managed so that normal operating cash needs and scheduled extraordinary cash needs can be met on a same day basis. Investments will be sufficiently liquid to provide a steady and reliable flow of cash to the District to insure that all land purchases can be made promptly(within two weeks). Goal 3. Income Temporarily idle funds shall cam the highest rate of return that is consistent with capital preservation and liquidity goals and the Government Code. GUIDELINES 1. Determination of Idle F The Controller will prepare a complete cash flow projection prior to all investment decisions. This cash flow projection will be reviewed and evaluated by the General Manager. The General Manager is responsible for approving the Controller's designation of the amount of funds not required for the immediate necessity of the District and available for investment. 2. Contingency Reserve A contingency reserve of between$500,000 and$2,000,000 shall be maintained with the Santa Clara County Pooled investment fund. The General Manager is responsible for approving the Controller's designation of the size of this contingency reserve. At all times this contingency reserve will be sufficient to satisfy the requirements for all Note Funds. 3. Non-Invested Funds Idle District funds not otherwise invested or maintained with paying agents will be deposited with the Santa Clara County Pooled investment fund. 4. Selection of Investments The Controller is responsible for selecting investments that fit within the amounts and maturities recommended by the Controller and by the General Manager. The Controller is also responsible for directing security transactions. Page 2 5. Investments Instruments Investments shall be limited to those allowed by Government Code Section 53601 et seq. and 53635 et seq. Investments shall not be leveraged. investments,and"derivatives,"that offer opportunities for significant capital gains and losses are excluded. All investments,other than funds held in trust for note holders and trust funds released after posting surety bonds, shall mature within 180 days. 6. Diversification Investments other than insured or collateralized deposits at banks and savings and loan associations shall be diversified. 7. Marketability For investments other than deposits,the breadth of ownership and number of securities outstanding will be sufficient to establish a secondary market in which investments can be readily converted to cash without causing a material change in their market value. 8. Acceptable Banks Bankers'Acceptances and Negotiable Certificates of Deposit may be purchased only from banks and savings and loan associations with over$1,000,000,000 of deposits and reporting profitable operations and which meet all applicable criteria of the Government Code. 9. Acceptable Collateral Securities collateralizing bank or savings and loan deposits must be rated"A"or higher. 10. Investments in Name of District All investments purchased shall stand in the name of the District. 11. Reportina The Controller shall report all security transactions to the Administration and Budget Committee no later than the next Regular Meeting of the Board of Directors after any transaction has been made. The Controller shall submit a report of the District's investments and security transactions to the Administration and Budget Committee by the fourth Wednesday of each month in accordance with Government Code Section 53607. The Controller will render a quarterly investment report to the Board of Directors as required by Government Code Section 53646. Such reports shall also be submitted to the General Manager and to the District's' auditor. The Administration and Budget Committee shall act on behalf of the Board of Directors in receiving reports from the Controller required by Government Code Section 53607. 12. Purchase of Securities Through Bank The Controller is authorized to purchase securities through the investment department of the District's bank. The Bank shall be instructed in writing only to purchase securities in the name of the District and that all matured funds shall be returned to the District's bank account. The Bank shall also be instructed to send receipts for transactions to the General Manager. RESOLUTION NO. 02-05 RESOLUTION OF THE BOARD OF DIRECTORS OF THE MIDPENINSULA REGIONAL OPEN SPACE DISTRICT ADOPTING A STATEMENT OF INVESTMENT POLICY AND AUTHORIZING THE CONTROLLER TO INVEST SURPLUS FUNDS ALLOWED BY GOVERNMENT CODE WHEREAS, the District needs to maximize the yield on surplus temporarily idle y� rP P Y funds in order to help meet land acquisition objectives; and WHEREAS, Chapter 4, Division 2 of Title 5 of the Government Code authorizes the District to deposit and invest surplus funds in investments which, at times, yield interest rates higher than achievable through the Santa Clara County Pooled Fund, or the California Pooled Investment Authority; and WHEREAS, the District can often improve its yield on surplus funds without sacrificing financial safety flexibility. NOW, THEREFORE, BE IT RESOLVED AS FOLLOWS: Section One. The Board of Directors of the Midpeninsula Regional Open Space District does hereby authorize the Controller to invest surplus or temporarily idle funds according to the Investment Goals and Guidelines attached hereto as Exhibit "A" and by reference made a part hereof. Section Two. Before any particular investments the Controller shall consult with the General Manager, or a District employee authorized to act in his/her behalf, to determine anticipated cash flow needs of the District. Section Three. This Resolution supersedes Resolution No. 00-03 adopted January 12, 2000. This Resolution shall no longer be in effect as of January 15, 2003, unless extended in time, and inactive funds shall then be deposited in the Santa Clara County Pooled Investment Fund, with the California Pooled Investment Authority, or invested through the District's bank. RESOLUTION NO. 02-05 PASSED AND ADOPTED by the Board of Directors of the Midpeninsula Regional Open Space District on January 16, 2002, at a regular meeting thereof, by the following vote: AYES: D. L.ittte, L. Hassett, N. Hanko, M. Davey, J. CyA, P. S.Lemenz, K. Ndtz NOES: none ABSTAIN: none ABSENT: none ATTEST: APPROVED: Secreta President Boar of Directors Board of Directors I, the District Clerk of the Midpeninsula Regional Open Space District, hereby certify that the above is a true and correct copy of a resolution duly adopted by the Board of Directors of the Midpeninsula Regional Open Space District by the above vote at a meeting thereof duly held and called on the above day. Y Distri&tlerk 0MBIT 44A" INVESTMENT GOALS AND GUIDELINES GOALS Goal 1. Capital Preservation The primary goal shall be to safeguard the principal of invested funds. Temporarily idle fimds shall be invested in a conservative manner, such that funds can always be withdrawn at, or just above or below,full invested value. Investments that offer opportunities for significant capital gains and losses are excluded. Goal 2. Liquidity Temporarily idle funds will be managed so that normal operating cash needs and scheduled extraordinary cash needs can be met on a same day basis. Investments will be sufficiently liquid to provide a steady and reliable flow of cash to the District to insure that all land purchases can be made promptly(within two weeks). Goal 3. Income Temporarily idle funds shall earn the highest rate of return that is consistent with capital preservation and liquidity goals and the Government Code. GUIDELINES 1. Determination of Idle Funds The Controller will prepare a complete cash flow projection prior to all investment decisions. This cash flow projection will be reviewed and evaluated by the General Manager. The General Manager is responsible for approving the Controller's designation of the amount of funds not required for the immediate necessity of the District and available for investment. 2. Contingency Reserve A contingency reserve of between$500,000 and$2,000,000 shall be maintained with the Santa Clara County Pooled investment fund. The General Manager is responsible for approving the Controller's designation of the size of this contingency reserve. At all times this contingency reserve will be sufficient to satisfy the requirements for all Note Funds. 3. Non-Invested Funds Idle District funds not otherwise invested or maintained with paying agents will be deposited with the Santa Clara County Pooled investment fund. 4. Selection of Investments The Controller is responsible for selecting investments that fit within the amounts and maturities recommended by the Controller and by the General Manager. The Controller is also responsible for directing security transactions. Page 2 5. Investments Instruments Investments shall be limited to those allowed by Government Code Section 53601 et seq. and 53635 et seq. Investments shall not be leveraged. Investments, and"derivatives,"that offer opportunities for significant capital gains and losses are excluded. All investments, other than funds held in trust for note holders and trust funds released after posting surety bonds, shall mature within 180 days. 6. Diversification Investments other than insured or collateralized deposits at banks and savings and loan associations shall be diversified. 7. Marketability For investments other than deposits,the breadth of ownership and number of securities outstanding will be sufficient to establish a secondary market in which investments can be readily converted to cash without causing a material change in their market value. 8. Acceptable Banks Bankers'Acceptances and Negotiable Certificates of Deposit may be purchased only from banks and savings and loan associations with over$1,000,000,000 of deposits and reporting profitable operations and which meet all applicable criteria of the Government Code. 9. Acceptable Collateral Securities collateralizing bank or savings and loan deposits must be rated"A"or higher. 10. Investments in Name of District All investments purchased shall stand in the name of the District. 11. Reporting The Controller shall report all security transactions to the Administration and Budget Committee no later than the next Regular Meeting of the Board of Directors after any transaction has been made. The Controller shall submit a report of the District's investments and security transactions to the Administration and Budget Committee by the fourth Wednesday of each month in accordance with Government Code Section 53607. The Controller will render a quarterly investment report to the Board of Directors as required by Government Code Section 53646. Such reports shall also be submitted to the General Manager and to the District's' auditor. The Administration and Budget Committee shall act on behalf of the Board of Directors in receiving reports from the Controller required by Government Code Section 53607. 12. Purchase of Securities Through Bank The Controller is authorized to purchase securities through the investment department of the District's bank. The Bank shall be instructed in writing only to purchase securities in the name of the District and that all matured funds shall be returned to the District's bank account. The Bank shall also be instructed to send receipts for transactions to the General Manager.