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HomeMy WebLinkAboutR-01-0448J-01-275 3/29/01 RESOLUTION NO. oi- 448 A RESOLUTION OF THE MIAMI CITY COMMISSION, WITH ATTACHMENT(S), ADOPTING THE INVESTMENT POLICY OF THE CITY OF MIAMI, FLORIDA, ATTACHED AND INCORPORATED, PURSUANT TO THE STATE OF FLORIDA'S INVESTMENT OF PUBLIC FUNDS ACT TO ESTABLISH GUIDELINES FOR THE INVESTMENT AND MANAGEMENT OF PUBLIC FUNDS; FURTHER DIRECTING THE CITY MANAGER TO IMMEDIATELY IMPLEMENT THE GUIDELINES CONTAINED IN THE POLICY. WHEREAS, the State of Florida signed into law the Revised Investment of Public Funds Act 1218.415, Florida Statutes (2000)] to provide uniform guidelines for the investment of public funds by municipalities, school districts, counties, and special districts; and WHEREAS, the Act specifically establishes investment policy guidelines, limitations, and conditions for the investment of the assets of local retirement plans, and of other public funds available to units of local governments and authorizes the Florida Department of Barking and Finance to withhold certain TTA CA QW9ENT fen. '7MOM cr" COM USSION MEETING OF MANY 10 101 `L— 148 0 ! funds from local governments which fail to meet the requirements of the Statute; and WHEREAS, the City Commission wishes to comply with the mandates of the Investment of Public Funds Act by adopting and implementing an investment policy for the City of Miami; NOW, THEREFORE, BE IT RESOLVED BY THE COMMISSION OF THE CITY OF MIAMI, FLORIDA: Section 1. The recitals and findings contained in the Preamble to this Resolution are hereby adopted by reference and incorporated as if fully set forth in this Section. Section 2. The Investment Policy of the City of Miami, Florida, attached and incorporated, is adopted pursuant to the State of Florida's Investment of Public Funds Act to establish guidelines for the investment and management of public funds. Section 3. The City Manager is directed to immediately implement the guidelines contained in the in the Policy. Page 2 of 3 Section 4. This Resolution shall become effective immediately upon its adoption and signature of the Mayor.11 PASSED AND ADOPTED this 10th day of Mary , 2001. .70E CAROLLO, MAYOR 1n with. Miami Cade Sec. 2_W, since the Msyar did not indicate apptvvol of 10A*b*w by Signing it in the designated pace rovided, said fegislatiDn .:ry bOOMUS 419=11ve with the elapse of ten (10 fl f tho0QwNMVC19rk ) gyp, same, without the Mayor ATTEST: Walter WALTER J. FOEMAN CITY CLERK App D Tjooloolr NQ CORREC'1'NESS :t/ 01- 448 Page 3 of 3 CITY OF' MIAMI 1NN`F TMENT POI.IC'Y RvN ►tilt» !?r► ►:► .► n ►? - , 240H0 I. PURPOSE It. SCOPE 3 III. INVESTMENT OBJECTIVES 3 IV. DELEGATION OF AUTHORITY 4 V. STANDARDS OF PRUDENCE d VI. ETIIICS AND CONFLICTS OF INTEREST 5 VII. INTERNAL CONTROLS AND 1 WESTMENT PROCEDURES 5 VIII. CONTINUING EDUCATION 5 IX. AUTHORIZED INVESTMENT INSTITUTIONS AND DEALERS 5 X. MATURITY AND LIQUIDITY REQUIREMENTS 6 XI. COMPETITIVF SELECTION OF INVESTMENT INSTRUMENTS 6 X11. AUTIIORI7.ED INVESTMENTS AND PORTFOLIO COMPOSITION 7 XIU. DERIVATIVE'S AND REVERSE REPURCHASE AGREEMENTS 14 XIV. PERFORMANCE MEASUREMENTS 15 XV. REPORTING 15 XVI. THIRD -PARTY CUSTODIAL AGREEMENTS 16 XVII. INVESTMENT POLICY ADOPTION 16 City of Miami 7� Investment Policy 01- 448 Page Investment Policy City of Miami. Florida 1. PURPOSE The purpose of this policy is to set forth the investment objectives and parameters for the management of public funds of the City of Miami, Florida (hereinafter "City"). These policies arc designed to safeguard the City's funds, the availability of operating and capital funds when needed, and an investment return competitive with comparable funds and financial market indices. II. SCONE in accordance with Suction 219.415, Florida Statues, this investment policy applies to all cash and investments held or controlled by the City And shall he identified as "general operating funds" of the City with the exception of the City's Pension Funds, Deferred Compensation & Section 401(a) Plans, and finds related to the issuance of debt where there are other existing policies or indentures in effect for such funds. Additionally, any future revenues, which have statutory investment requirements conflicting with this Investment Policy and funds held by state agencies (e.g., Department of Revenue), are not subject to the provisions of this policy. Ill. INVESTMENT OB CTIVES We)y of PringinaI The foremost objective of this investment program is the safety of the principal of those funds within the portfolios, Investment transactions shall seek to keep capital losses at a minimum, whether they are from securities defaults or erosion of market value. To attain this objective, diversification is required to order that potential losses on individual securities do not exceed the income generated from the remainder of the portfolio. From time to time. securities may be traded for other similar securities to improve yield, maturity or credit risk. For these transactions, a loss may be incurred for accounting purposes, provided any of the following occurs with respect to the replacement security: A. Yield has been increased, or H. Maturity has been reduced, or lengthen C. Quality of the investment has been improved. City of Miami investment Policy 01— 448 Page 3 4141iI1P)A aintenAncc_of Liquidity The portfolios shall be managed in such a manner that funds are available to meet reasonably anticipated cash flow requirements in an orderly manner. Periodical cash flow analyses will be completed to order to ensure that the portfolios arc positioned to provide sufficient liquidity. Returnon Investment Inveshttent portfolios shall be designed with the objective of attaining a market rate of return throughout budgetary and economic cycles, taking into account the investment risk constraints and liquidity needs. Return on investment is of least importance compared to the safety and liquidity objectives described above. 'The core of investments is limited to relatively low risk securities in anticipation of earning a fair return relative to the risk being assumed. 1V. DELEGATION Of? AUTIIORITY M accordance with the City's Administrative Policies, the responsibility for providing oversight and direction in regard to the rnanagentcnt of the investment program resides with the City's Finance Director. The management responsibility for all City funds in the investment program and investment transactions is deiegatcd to lite Finance Director or designce. The Finance Director shall establish written procedures for the operation of the investment portfolio and a system of internal accounting and administrative controls to regulate the activities of ernployees. The (-it), may employ an Investment Advisor to assist in managing some of the City's portlblios. Such Investment Advisor must he registered under the Investment Advisors Act of 1940. V. STANDARDS OF PRUDENCE The standard of prudence to be used by investment officials shall he the "Prudent Person" standard and shall be applied in the context of managing the overall investment program. 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 expectation are reported to the nireclor of Finance in a timely fashion and the liquidity and tits sale of securities arc carred out to accordance with the ternis of this policy. "rhe "Prudent Person" rule states the following: investments shall be made with judbnnent and care, carder 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 Nvcll as the probable income to be derived from the investment. While the standard of prudence to be used by investment officials who are officers or employees is the "Prudent Person" standard, any person or firm hired or retained to invest, monitor, or advise concerning these assets shall be held to the higher standard of "Prudent Expert". The standard shall be that in investing and reinvesting moneys and in acquiring, retaining, managing, and disposing of investments of these funds, the contractor shall exercise: the judgment, care, skill, prudence, and diligence under the circumstances then prevailing, which persons of prudence, discretion, and intelligence, acting in a like capacity and familiar with such matters would use in the conduct of an enterprise of like character and with like anus by diversifying lite investments of the funds, so us to minimize the risk, considering the probable invotne as well as the probable safety of their capital. City of Mianti Im estntent Policy 0.1— 448 Page 4 VI. ETHICS AND CONFLICTS OF INTEREST Employees involved in the investment process shall refrain from personal business activity that could conflict with proper execution of the investment program, or which could impair their ability to make impartial investment decisions. Also, employees involved in the investment process shall disclose to the City Manager any material financial interests in financial institutions that conduct business with the City, and they shall further disclose any material personal financial/investment positions that could he related to the performance of the City's investment program. V11. INTERNAL CONTROLS AND INVESTMENT PROCEDIIRFS The Finance Director shall establish a system of internal controls and operational procedures that are in writing and made a part of the City's operational procedures. The internal controls should be designed to prevent losses of funds, which might arise from fraud, employee error, and misrepresentation, by third parties, or imprudent actions by employees. The written procedures should include reference to safekeeping, repurchase abr:ements, separation of transaction authority trom accounting and recordkeeping, wire transfer agreements, banking service contracts, collateraPdepository agreements, and "delivery -vs -payment" procedures. No person may engage in in investment transaction except as authorized under the terms of this policy. Independent auditors as a normal part of the annual financial audit to the City shall conduct a review of the system of internal controls to ensure compliance with policies and procedures. Vill. CONTINUING EDUCATION The Finance Director, 7 rcasurer, and appropriate staff' shall annually complete 8 hours of continuing education in subjects or courses of study related to investment practices and products. IX. AUTHORIZED INVESTMENT INSTITUTIONS AND DEALERS Authorized City stuff' shall only purchase securities from the following financial and investment institutions. A. Certificates of Deposit or Savings Accounts These investments may only be purchased from public depositories qualified by the Treasurer of the State of Florida, in accordance with Chapter 280, Florida Statutes. H. Overnight Repurchase Agreement Collateral for the City's "Sweep Accounts" shall be held at City's depository bank that must be a State Qualified Public Depository. City of Miami Investment Policy 01- 448 Page 5 111 C. All Other Investments For purchases and sales of securities by the City, dealers designated as "Primary Securities Dealers" by the Federal Reserve Bank of New York or from direct issuers of commercial paper and bankers' acceptances will be utilized, and all approved non-primary securities dealers that qualify under Securities and Exchange Commission Rule ISC3-1 (uniform net capital rule) must provide the following information priur to executing investment trades with the City: 1. Annual financial statement, as well as most recent quarterly statement. 2. Regulatory history. through either the Office of the Comptroller of the Currency for dealer banks, or the NASI) fin securities firms. 3. Statement of any pending lawsuits materially aft'ecting the tirm's business. Each Dealer's representative will be required to complete the "City's Investment Firm Certification Form" prior to the City conducting any business with the Dealer oi- its representative. X. MATURITY AND LIQUIDITY REQUIREMENTS To the extent possible, an attcntpt will be made to match investment maturities with known cash needs and anticipated cash flow requirements. A. Maturity Guidelines Securities purchased by or on behalf of the City shall have a final maturity of five (5) years or less from the date of purchase. The overall weighted average duration of principal return for the portfolio shall be le::s than three (3) years. The maturities of the underlying securities of a repurchase agreement will follow the requirements of the Master Repurchase Agreement. H. Liquidity Requirements in order to meet the day-to-day expenditure needs of the City, $3,000,000 will be the targeted cash balance in the City's depository bank. All funds in the depository bank will be "swept" each night into a fully eollatcrahmd repurchase agreement account. XI. COMPETITIVE SELECTION OF INVESTMENT INSTRUMENTS After the Finance Director or Designee has determined the approximate maturity date based on cash flow needs and market conditions and has analyzed and selected one, or more optimal types of investments, a minimum of three (3) qualified banks and/or approved broker/dealers must be contacted and asked to provide bids/offers on securities in questions. Bids will be held in confidence until the bid deemed to best meet the investment objectives is detennined and selected. However, if' obtaining bids/offers are not feasible and appropriate, securities may be purchased utilizing the comparison to current market price method on an exception busts. Acceptable current market price providers include, but are not limited to: A. Telerate Information System City of Miami Investment Policy 01— 448 Page 6 B. Bloomberg Intormation Systems C. Wall Street ,toutnal or a comparable nationally recognized financial publication providing daily market pricing D. Daily market pricing provided by the City's custodian or their correspondent institutions The Finance Director or designee shall utiliec 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 only be utilized when, in judgment of the Finance Director or designee, competitive bidding would inhibit the selection process. Examples of when this method inay be used include: A. When time constraints due to unusual circumstances preclude the use of the competitive bidding process B. When no active market exists for the issue being traded due to the age or depth of the issue C. When a security is unique to a single dealer, for example, a private placement D. When the transaction involves new issues or issues in the "when issued" market Overnight sweep repurchase agreements will not be bid, but may be placed with the City's depository bank relating to the demand account for which the repurchase agreement was purchased. X11. AIITIIORIZND INVESTMENTS AND PORTFOLIO COMPOSITION Investments should be made subject to the cash flow needs and such cash flows are subject to revisions as market conditions and the City's needs change. ilowever, when the invested funds are needed in whole or in part for the purpose originally intended or for more optimal investments, the Finance Director or designee may sell the investment at the then -prevailing market price and place the proceeds into the proper account at the City's custodian. The following are the investment requirements and allocation limits on security types, issuers, and maturities as established by the City. Diversification strategies wilhin the established guidelines shall be reviewed and revised periodically as necessary by the Investment Committee. 1 h hivestment Committee, Director of Finance or designee shall have the option to further restrict investment percentages from time to time based on market conditions, risk and diversification investment strategies. The percentage allocations requirements for investment types and issuers are calculated bused on the original cont of each investment. Investments not listed in this policy are prohibited. A. The Florida Local Government Surplus Funds Trust Fund ("SBA") Investment Authorization The Finance Director or designee may invest in the MIA. Portfolio Composition City of Mianu investment policy 01— 44v age? IIIi1IlI!�i -- • A maximum of 100% of available funds may be invested in the SHA. B. United States Government Securities 1. Purchase Authorization The Finance Director or designee may invest in negotiable direct obligations, or obligations the principal and interest of which are unconditionally guaranteed by the United States Government. Such securities will include, but not be limited to the following: Cash Management Bills Treasury Securities — State and Local Government Series ("SI.GS'l Treasury Bills Treasury Notes Treasury Bonds Treasury Strips 2. Portfolio Composition A maximum of 100% of available funds may be invested in the United States Government Securities with the exception of Treasury Strips are limited to 10% of available funds. 3. Maturity Limitations The maximum length to maturity of any direct investment in the United States Government Securities is five (S) years from the date of purchase. C. United States Government Agencies 1. Purchase Authorization The Finance Director or designee may invest in bonds, debentures, notes or callables issued or guaranteed by the United States Governments agencies, provided such obligations are backed by the full faith and credit of the United States Government. Such securities will include, but not be limited to the tbilowing: United States Export— Import Bank -Direct obligations or fully guaranteed certificates of beneficial ownership Farmer Home Administration -Certificates of beneficial ownership Federal Financing Bank -Discount notes, notes and bonds Federal Housing Administration Debentures Government National Mortgage Association (GNMA) -GNMA guaranteed mortgage-backed bonds -GNMA guaranteed pass-through obligations City of Miami Invosttnent Policy 01-- 448 Page 8 • • General Services Administration United States Maritime Administration Guaranteed -Title XI Financing New Communities Debentures -United States Government guaranteed debentures United States Public Housing Notes and Hands -United States Croverltment guaranteed public housing notes and bonds United States Department of housing and Urban Development -Project notes and local authority bonds 2. Portfolio Composition A maximum of 50°/, of available funds may be invested in United States Government agencies. 3. Limits on Individual Issuers A maximum of 10% of available funds may be invested in individual United States Government agencies. 4. Maturity Limitations The maximum length to maturity for an investment in any United States Government agency security is five (5) years from the date of purchase. D. Federal Instrumentalities (united States Government sponsored agencies) 1. Purchase Authorization The Finance Director or designee may invest in bonds, debentures, notes or callable& issued or guaranteed by United States Government sponsored agencies (Federal Instrumentalities) which are non -full faith and credit agencies limited to the following: I-ederal Farm Credit Hank (FFCB) Federal Borne loan Bank or its City banks (FHI.B) Federal National Mortgage Association (FNMA) Federal home I.rlalt Mortgage Corporation (Freddie -Macs) including Federal - IIome loan Mortgage Corporation participation certificates 2. Portfolio Composition A maximum of 100% of available funds may be invested in Federal Instrumentalities. 3. Limits on Individual Issuers A maximum of 25% of available funds may be invested in any one issuer. 4. Maturity Limitations City of Mianu InvesmKnl Policy 01-- 448 Page 9 • The maximum length to maturity for an investment in any Federal Instrumentality security is five (5) years from the date of purchase. E. Interest Bearing Time Deposit or Saving Accounts 1. Purchase Authorization The Finance Director or designee may invest in non-negotiable interest bearing time certificates of deposit or savings accounts in banks organized under the laws of this state and/or in national hanks organized under the laws of the United States and doing business and situated in the State of Florida, provided that any such deposits are secured by the Florida Security for Public Deposits Act, Chapter 280, Florida Statutes. Additionally, the bank shall not be listed with any recognized credit watch information service. 2. Portfolio Composition A maximum of 10% of available funds may be invested in non-negotiable interest bearing time certificates of deposit. 3. Limits on Individual Issuers A maximum of 10% of available funds may be deposited with any one issuer. 4. The maximum maturity on any certificate shall be no greater than one (1) year from the date of purchase. F. Repurchase Agreements 1. Purchase Authorization a. 'rhe Finance Director or designee may invest in repurchase agreements composed of only those investments authorized in Section XII.B, C, and D. All firms are required to sign the City's Master Repurchase Agreement prior to the execution of a repurchase agreement transaction. b. A third party custodian with whom the City has a current custodial agreement shall hold the collateral for all repurchase agreements with a term longer than one (1) business day. A clearly marked receipt that shows evidence of ownership must be supplied to the Finance Director or designee and retained. C. Securities authorized for collateral must have maturities under ten (10) years and with market value for the principal and accrued interest of 102 percent of the value and for the term of the repurchase agreement. Immaterial short-term deviations from 102 percent requirement are permissible only upon the approval of the Finance Director or designee. d. The overnight sweep arrangement shall adhere to the agreement between the City and the City's depository bank. 01- 448 City of Miami Investment Policy Page 10 2. Portfolio Composition A maximum of 20% of available funds may be invested in repurchase agreements excluding one (1) business day agreements and overnight sweep agreements. 3. Limits on Individual Issuers A maximum of 10% of available funds may be invested with any one institution excluding one (1) business day agreements and overnight sweep agreements. 4. limits on Maturities The maximum length to maturity of any repurchase agreement is 90 days from the date of purchase. G. Commercial Paper 1. Purchase Authorization 'rhe Finance Director or designee may invest in commercial paper of any United States company that is rated, at the time or purchase, "Prime -1" by Moody's and "A-1" by Standard &c Poor's (prime commercial paper). if the commercial paper is backed by a letter of credit ("LOC."), the long-term debt of the LOC provider must be rated "A" or better by at least two nationally recognized rating agencies. 2. Portfolio Composition A maximum of 351% of available funds may be directly invested in prime commercial paper. 3. Limits on Individual Issuers A maximum of 10% of available funds may be invested with any one issuer. 4. Maturity Limitations The maximum length to maturity for prime commercial paper shall be 270 days from the date of purchase. H. Corporate Notes 1. Purchase Authorization The Finance Director or designee may invest in corporate notes issued by corporations organized and operating within the Unitcd States or by depository institutions licensed by the United States that have a long term debt rating, at the time or purchase, at a minimum "Aa" by Moody's and a minimum long term debt rating of "AA" by Standard & Poor's. City of Miami Investment Policy 01— 448 page 11 m uffiE sy • • 2. Portfolio Composition A maximum of 25% of available funds may be directly invested in corporate notes. 3. Limits on Individual Issuers A maximum of 10% of available funds may be invested with any one issuer. 4. Maturity Limitations The maximum length to maturity for corporate notes shall be (2) two years from the date of purchase. 1. Bankers' Acceptances 1. Purchase Authorization The Finance Director or designee may invest in Bankers' Acceptances issued by a domestic bank or a federally chartered domestic office of a foreign bank, which are eligible for purchase by the Federal Reserve System, at the time or purchase, the short- term pater is rated, at a minimum, "P-1" by Moody's Investors Services and "A-1" Standard & Poor's. 2. Portfolio Composition A maximum of l0% of available funds may be directly invested in Bankers' Acceptances 3. Limits on Individual Issuers A maximum of 5'% of available funds may be invested with any one issuer. 4. Maturity !.imitations The maximum length to maturity for hankers' Acceptances shall be 180 days from the date of purchase. J. State and/or Local Government Taxable and/or Tax -Exempt Debt 1. Purchase Authori7ation 1'he Finance Director or designee may invest in state and/or local government taxable and/or tax-exempt debt, general obligation and/or revenue bonds, rated at least "An" by Moody's and "AA" by Standard & Poor's for long-term debt, or rated at least "MIG -2" by Moody's and "SP -2" by Standard & Poor's for short-term debt. 2. Portfolio Composition A maximum of 25% of available funds may be invested in taxable and tax-exempt General Obligation bonds. City of Miami Investn►cr►t Policy 01.E 448 Pagc 12 0=01— " - 0 0 A maximum of 10% of available funds may be invested in taxable and tax-exempt Revenue and Excise tax bonds of the various municipalities of the State of Florida, provided none of such securities have been in default within five (5) years prior to the date of purchase. 3. Maturity Limitations A maximum length to maturity for an investment in any state or local government debt security is (2) two years from the date of purchase. K. Registered Investment Companies (Money Market Mutual funds) 1. Investment Authorization The Finance Director or designee may invest in shares in open-end and no-load money market funds provided such funds are registered under the Federal Investment Company Act of 1940 and operate in accordance with 17 C.F.R. § 270.2a-7, which stipulates that money market funds must have an average weighted maturity of 90 days or less. 2. Portfolio Composition A maximum of 20% of available funds may be invested in money market funds. 3. Limits of Individual Issuers A maximum of 10% of available funds may be invested with any one money market fund. 4. Rating Requirements The money market funds shall be rated "AAm" or "AAm-G" or better by Standard & Poor's, or the equivalent by another rating agency. 5. Due Diligence Requirements A thorough review of any money market fund is required prior to investing„ and on a continual basis. There shall be a questionnaire developed by the Finance Director or designee that will contain a list of questions that covers the major aspects of any investment pool/fund. L. Intergovernmental Investment Pool 1. Investment Authorization 01— 448 City of Miami Investment Policy Yasc 13 0 r� 'rhe Finance Director or designee may invest in intergovernmental investment pools that are authorized pursuant to the Flonda Interlocal Cooperation Act, as provided in Section 163.01, Florida Statutes and provided that said funds contain no derivatives. 2. Portfolio Composition A nuiximum of 25% of available funds may he invested in intergovernmental investment pools. Due Diligence Requirements A thorough review of any investment pool/fund is required prior to investing, and on a continual basis. There shall be a questionnaire developed by the Finance Director or Designee that will contain a list of questions that covers the major aspects of any investment pool/fund. XIII. DERIVATIVES AND REVERSE REPURCHASE AGREEMENTS The City may invest in investment products that include the use of derivatives as long as the dollar amount invested by the investment product is minuscule to the total dollar amount invested by the investment product. The Finance Director or designee shall develop sufficient understanding of the derivative products and have the expertise to manage them. A "derivative" is defined as a financial instrument the value of which depends on, or is denved from, the value of one or more underlying assets or indices or asset values. If the Finance Director approves the use of reverse repurchase agreements or other forms of leverage, the investment shall be limited to transactions in which the proceeds are intended to provide liquidity and for which the City has sufficient resources and expertise to manage them. XIV. PERFORMANCE MEASUREMFNTS In order to assist in the evaluation of the portfolios' performance, the City will use performance benchmarks for short-term and long-term portfolios. The use of benchmarks will allow the City to measure its returns against other investors to the same mc.rkets. A. The short-term investment portfolio shall be designed with the annual objective of exceeding the weighted average return (not book value rate of return) of the Florida Local Government Surplus Funds Trust Fund (SBA). H. The long-term investment portfolio shall be designed with the annual objective of exceeding the return of the Merrill Lynch 1-3 Year 'Treasury Index compared to the portfolio's total rate of return. The Merrill Lynch 1-3 Year Treasury Index reprex:nts all U.S. Treasury securities maturing over one year, but less than three years. This maturity range is an appropriate benchmark based on the objectives of the City. XV, REPORTING City of Miami Investment Policy 01 � 448 Page 14 A. The Finance Director or designee will prepare quarter]), investment reports. Schedules in the quarterly report should include the following: 1. A listing of individual securities held at the end of the reporting period 2. Pereentage of available funds tepresented by each investment type 3. Coupon, discount or earning rate 4. Average lite or duration and final maturity of all investments 5. Par value, and market value 13. Annual Investment Report On an annual basis, the Finance Director shall prepare and submit to the City Commissi(m a written report on all invested tends. The annual report shall provide all, but not limited to, the following: a complete list of all invested funds, name or type of security in which the funds are invested, the amount invested, the maturity date, earned income, the book value, the market value and the yield on each investment. The annual report will show performance on both a hook value and total rate of return basis and will compare (lie results to the above -stated performance benchmarks. All investments shall be reported at fair value per GASB standards. Investment reports shall be available to the public. C. Investment Committee The City shall have an investment committee comprised of the Finance Director, Assistant Finance Director, Treasurer, and investment Coordinator to report to this committee as often us requested. Reports shall be prepared and distributed to the committee quarterly. XVI. THIRD -PARTY CUSToDIAL AGREEMENTS Securities, with the exception of certificates of deposits, shall be held with a third party cusludiam and all securities purchased by, and all collateral obtained by; the City should he properly designated as an asset of the City. The securities must be held in an account separate and apart from the assets of the financial institution. A third party custodian is defined as any bank depository chartered by the Federal Government, the state of Florida, or any other state or territory of the I I nitcd States which has a branch or principal place of business to the State of Florida as defined in Sectiun 658.12, Florida Statutes, or by a national association organized and existing under the laws of the United Stutcs which is authorized to accept and execute trusts and which is doing business in the State of Florida. Certificates ot'deposits will be placed in the provider's safekeeping department for the term of the deposit. The custodian shall accept transaction instructions only from those persons who have been duly authorized by the Director of Finance and which authorization has been provided, in writing, to the custodian. No withdrawal of securities, in whole or in pan, shall be made from safekeeping, shall he permitted unless by such a duly authorized person. The custodian shall provide the Finance Director or designee with safekeeping receipts that provide detail information on the securiucs held by the custodian, In addition, the custodian shall report at lcust City of.Mianii Investment Policy 0I — 4448 Page 15 PIII Ll quarterly and the Finance Director or designee shall verify the reports. Security transactions between a broker/dealer and the custodian involving the purchase or sale of securities by transfer of money or securities must be made on a "delivery vs. payment" basis, if applicable, to ensure that the custodian will have the security or money, as appropriate, in hand at the conclusion of the transaction. Only after receiving written authorization from the Director of Finanec shall the City Treasurer be authorized to deliver securities "free". Securities held as collateral shall be held free and clear of any liens. XVII. INVESTMENT POLICY ADOPTION The investment policy shall he adopted by City resolution. The Director of Finance, Treasurer, and the Investment Committee shall review the policy annually and the City Commission shall approve any modification made thereto. PASSED AND ADOPTED BY THE CITY COMMISSION ON ATTEST: wAt; ('ER J. FOREMAN CITY CLERK Approved as to form and correctness AL17JANDRO VILARELLO C117YATTORNEY City of'Vtianu Investment Policy JOT: CAROLLO, MAYOR 01- 448 Page 16 G 7 • Cl`f 0C M A`.11 FLOROA •20 INTER -OFFICE MEMORANDUM Honorable Mayor and Members LE of the City Commission 5..S.Ec" Resolution Approving Investment Policy = Carlos A. Gimenez City Manager r Recommendation: It is respectfully recommended that the City Commission adopt the attached resolution establishing a written Investment Policy in accordance with Section 218.415, Florida Statute. This resolution further directs the City Manager to implement the Investment Policy. Background In accordance with Section 218.415, Florida Statutes, this Investment Policy applies to all cash and investments held or controlled by the City and shall be identified as "General Operating Funds" of the City. The objective of this investment program is the safety of the principal of those funds within the portfolios. To attain this objective, diversification' is required in order generate maximum yield at the same time reduce investment risk. 0 B&sz-- CAG/RJN/SS/PC Q1— 448