Loading...
HomeMy Public PortalAboutORD16044BILL NO. 2019-137 SPONSORED BY: Councilman Mihalevich ORDINANCE NO. l(o 044 AN ORDINANCE OF THE CITY OF JEFFERSON, MISSOURI, ENACTING AN UPDATED INVESTMENT POLICY. BE IT ENACTED BY THE COUNCIL OF THE CITY OF JEFFERSON, MISSOURI, AS FOLLOWS: Section 1. The document entitled Investment Policy dated May 21, 2020, and attached hereto as Exhibit A, is hereby adopted as the office investment policy for the City of Jefferson. Section 2. This Ordinance shall be in full force and effect from and after the date of its passage and approval. Passed: � p 15.2020 Presiding Officer ATTEST: Approved:�-0 Mayor Carrie Tergin APPROVED AS TO FORM: City Cie City �An or EXHIBIT A City of Jefferson, Missouri INVESTMENT POLICY The City of Jefferson, Missouri, as an organization established to serve and protect the interest of its citizens, has as one of its many responsibilities, the proper management of money entrusted to its care. The stipulations of the policy are designed to allow good management of those funds by investment so they will work for the good of the citizens, while keeping in mind that maintenance of the principal is more critical and a higher priority than any consequential gain that might be made. With the language and resulting controls established herein, both objectives should be addressed in the best possible fashion. This investment policy for the City shall be reviewed by the Council on a periodic basis after its adoption. Any changes must be approved by the Council. I. Policy It is the policy of the City to invest public funds in a manner which will provide maximum security of capital, meet daily cash flow demands, and earn a market rate of return on investment for like maturities and securities instruments, while conforming to all applicable statutes governing the investment of public funds. II. Scope A. Funds included in the investment policy are accounted for in the City's Comprehensive Annual Financial Report and include: 1. General Fund 2. Special Revenue Funds 3. Debt Service Funds 4. Capital Projects Funds 5. Enterprise Funds 6. Internal Service Funds 7. Trust and Agency Funds Exceptions to the above include: 1 May 21, 2020 IV. EXHIBIT A a) Investments in employees' Deferred Compensation plans b) Public not-for-profit corporations created by the City under Chapter 355, or other sections of the revised statutes of Missouri, as amended, for the purposes of issuing tax —exempt debt instruments. Permitted investments are identified within the issuance documents and agreements for specific issues and approved by the corporation Board of Directors. C) Investments of Bonds Proceeds. The agents of our trust agreements for debt issues will, with the advice and consent of the Finance Director, invest such funds as are available in reserve accounts entrusted in their care per the applicable debt indenture. B. Pooling of Funds Except for cash in certain restricted and special funds, the City of Jefferson will consolidate cash and reserve balances from all funds to maximize investment earnings and to increase efficiencies with regard to investment pricing, safekeeping and administration. Investment income will be allocated to the various funds based on their respective participation and in accordance with generally accepted accounting principles. Diversification The City's Investments will be diversified to minimize the risk of loss resulting from over concentration of assets is (1) a specific investment type, (2) a specific issuer, or (3) a specific maturity. The following guidelines represent limits established for diversification by instrument: Diversification of Percent of Portfolio Investment Type and Issuer Minimum — Maximum U.S. Treasury Obligations 0%-100% U.S. Government Agency Securities and Instrumentalities of Government 0%-80% Certificates of Deposit (CDs) 0%-50% Repurchase Agreements, Demand Deposit Accounts (DDAs), or Negotiable Order of Withdrawal (NOW) Accounts 0%-100% Full faith and credit obligations of the State or any Missouri local government entity 0%-25% Delegation of Authority Authority to manage the Investment program is granted to the Director of Finance. 2 May 21, 2020 EXHIBIT A V. Standards of Care A. Prudence The standard of prudence to be used by investment officials shall be the "uniform prudent investor act" standard and shall be applied in the context of managing an overall portfolio. Investment officers acting in accordance with written procedures and this 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 the liquidity and the sale of securities are carried out in accordance with the terms of this policy. Investments shall be made with judgement 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. The "prudent person" concept discourages speculative transactions. It attaches primary significance to the preservation of capital, and secondary importance to the generation of income and capital gains. The "prudent person" is expected to be a reasonably well informed person, not a professional investor or market maker, who is obligated to act responsibly. B. Ethics and Conflicts of Interest Officers and employees involved in the investment process shall refrain from personal business activity that could conflict with the proper execution and management of the investment program, or that could impair their ability to make impartial decisions. Employees and investment officials shall disclose any material interests in financial institutions with which they conduct business, in accordance with applicable laws. They shall further disclose any personal financial/investment positions that could be related to the performance of the investment portfolio. VI. Investments, Safekeeping and Custody A. Permissible Investment Types The following investments will be permitted by this policy: 1. U.S. Treasury Obligations 2. U.S. Government Agency Securities and instrumentalities of Government sponsored enterprises 3. Repurchase Agreements 4. Collateralized DDA or NOW Accounts 5. Certificates of Deposit (CDs) 6. Any full faith and credit obligations of the United States Government 7. Any full faith and credit obligations of the State of Missouri 8. Any full faith and credit obligations of a Missouri local government unit 9. Missouri local government investment pools May 21, 2020 EXHIBIT A B. Credit Ratings Except for bonds of the City of Jefferson, any bonds accepted for investment or pledged as collateral shall have a credit rating of "A" or better by a nationally recognized ratings agency. VII. Reporting The Finance Director shall prepare an investment report at least annually, including a succinct management summary that provides a clear picture of the status of the current investment portfolio. This management summary will be prepared in a manner which will demonstrate that investment activities during the reported period have conformed to the investment policy. The report will include the following: A. A listing of individual securities held at the end of the reporting period, summarized by maturity date and investment category. B. Percentage of the total portfolio which each type of investment represents. C. The fair value of the portfolio. Fair values for investments are determined by the closing market prices as reported by the custodian. 4 May 21, 2020