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HomeMy WebLinkAbout26-City Treasurer , CITY OF SAN BERh_~RDINO ~ REQUEST ~ ")R COUNCIL ACTION From: CRAIG A. GRAVES, City Treasurer Subject: Filing of ~"r-'~ _ ".,..._l,.J!,: r":rr: City'&-rnvestment poiicy ,..... I'" ,.-, ,., ! ': E~ ~ l~:'-:i 1 ~. Dept: CITY TREASURER' S OFFICE Date: April 17, 1990 Synopsis of Previous Council action: March 24, 1986 - Mayor and Common Council receipted and filed Statement of Investment Policy April 6, 1987 - Mayor and Common Council receipted andfiled Statement of Investment Policy February 15, 1988 - Mayor and Common Council receipted and filed Statement of Investment Policy Uarch 22, 1989 - Mayor and Common Council receipted and filed Statement of Investment Policy Recommended motion: Adopt Resolution. Council Notes: 7,,>.n?62 Agenda Item No. ~~ CITY OF SAN BER~ARDINO - REQUEST ~ ~R COUNCIL ACTION STAFF REPORT The City Treasurer is required each year to file a Statement of Investment policy with it's respective legislative body. The attached investment policy sets forth the parameters being used in the investment of City Funds. It states the goals, purpose and objectives of the City's Investment Program. The policy also includes the priorities used for determing investments and the various types of instruments the City uses. There are no changes from last years policy. 7he original policy was reviewed by the Ways and Means Committee and then referred back to the Mayor and Common Council for formal filing in 1985. This policy has been filed annually with the Mayor and Common Council by the City Treasurer to comply with Government Code Section 53646(a). 75.0264 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 1 RESOLUTION NO. 2 RESOLUTION OF THE CITY OF SAN BERNARDINO ACKNOWLEDGING THE RECEIPT AND FILING OF THE ANNUAL STATEMENT OF INVESTMENT POLICY 3 FOR THE YEAR 1990. 4 NOW, THEREFORE, BE IT RESOLVED BY THE MAYOR AND COMMON COUNCIL OF THE CITY OF SAN BERNARDINO AS FOLLOWS: 5 SECTION 1. Recitals. 6 A. The California State Legislature passed legislation 7 8 during the 1984 session requiring the filing of an annual Statement of Investment Policy by local public agencies. 9 B. The Governor of the State of California signed such legislation into law effective January 1, 1985 (Chapter 1226). C. The City Treasurer of the City of San Bernardino declares the annual Statement of Investment Policy is as set forth in Exhibit "A", attached hereto and incorporated herein by this reference as though fully set forth at length. SECTION 2. Implementation. An annual Statement of Investment Policy for the City of San Bernardino has been filed by the City Treasurer for calendar year 1990 in compliance with Section 53646(a) of the Government Code of the State of California. / / / / / / / / / / / / / / / / / / / / / / / / DAB/ses/Receipt.res 1 April 19, 1990 1 RESOLUTION OF THE CITY OF SAN BERNARDINO ACKNOWLEDGING THE RECEIPT AND FILING OF THE ANNUAL STATEMENT OF INVESTMENT POLICY 2 FOR THE YEAR 1990. 3 I HEREBY CERTIFY that the foregoing resolution was duly 4 adopted by the Mayor and Common Council of the City of San meeting thereof, held on the 5 Bernardino at a 6 day of , 1990, by the following vote, to wit: 7 Council Members: AYES NAYS ABSTAIN 8 ESTRADA 9 REILLY 10 FLORES 11 MAUDSLEY 12 MINOR 13 POPE-LUDLAM 14 MILLER 15 16 City Clerk 17 The foregoing resolution is hereby approved this day 18 , 1990. of 19 20 21 W. R. Holcomb, Mayor City of San Bernardino 22 Approved as to form and legal content: 23 JAMES F. PENMAN, City Attorney 24 By: ~ ?l e-..-- o 25 26 27 28 DAB/ses/Receipt.res April 19, 1990 2 CITY OF SAN BERNARDINO Statement of Investment Policy PURPOSE This statement is intended to provide guidelines for the prudent investment of the City's temporary idle cash, and outline the policies for maximizing the efficiency of the City's cash management system. The u1~imate goal is to enhance the economic status of the City while protecting its pooled cash. OBJECTIVE The City's cash management system is designed to accurately monitor and forecast expenditures and revenues, thus enabling the City to invest funds to the fullest extent possible. The City attempts to obtain the highest yield obtainable as long as investments meet the criteria established for safety and liquidity. POLI CY The City of San Bernardino operates its temporary pooled idle cash investments under the prudent man rule (Civil Code Section 2261, et sequl) (copy attached). This affords a broad spectrum of investment opportunities so long as the investment is deemed prudent and is allowable under current legislation of the State of California and other imposed legal restrictions. The City of San Bernardino strives to maintain the level of investment of idle funds as near to 100% as possible, through daily and projected cash flow determination. Idle cash management and investment transactions are the responsibility of the City Treasurer. Investments are made under the terms and conditions of Sections 53600-53683 of the Government Code of California. Criteria for selecting investments and the order of priority are: 1) SAFETY Safety and the minimizing of risks associated with investments refers to attempts to reduce the potential loss of principal, interest, or a combination of the two. The first level of control is in State law which restricts municipalities to certain investment instruments. The second level of risk control is the investment in instruments that appear on examination to be the most credit worthy. The third level of control is in the reduction of market risk by investing in sufficient instruments that have maturities coinciding with dates of disbursement. San Bernardino only invests in those instrumeRts that are considered :i..ery safe. EXHIBIT "A" 2) LIQUIDITY Liquidity is the ability to easily sell at any time with the minimal risk of losing some portion of principal or interest. Liquidity is an extremely important quality as the City may have an unexpected need for funds to be disbursed occasionally. Most investments are highly liquid, with the exception of collateralized or insured term certificates of deposit issued by banks and savings and loans. Certificate maturities are selected to anticipate cash needs, thereby eliminating the need for forced liquidation. 3) YIELD Yield is the potential dollar earning an investment can provide or "rate of return". San Bernardino attempts to obtain the highest yield possible when selecting an investment, provided that the criteria stated in the Investment Policy for safety and liquidity are met and the investment guideline and strategy are adherred to. Investments are made in the following: Securities of the U. S. Government and obligations of its agencies; Registered treasury notes, bonds, or legal obligations of the State of California; Certificates of Deposits, placed with commercial banks and savings and loans; Bankers Acceptances; Repurchase Agreements; Commercial Paper; negotiable Certificates of Deposit; Local Agency Investment Fund Demand Deposits; Passbook Savings Account Demand Deposits; Interest Bearing Demand Deposits; Money-Market Accounts of acceptable instruments. Government and agency securities are the highest quality investments available in terms of safety and liquidity. Certificates of Deposit, savings accounts, repurchase agreements, and bankers acceptances are insured or collateralized. Only commercial paper with both A-l Moody's and P-l Standard and Poor's ratings are purchased. The City of San Bernardino operates its investment program with many Federal and State, and self-imposed constraints. It does not buy stocks, or deal in futures, options, or security loan agreements. To maximize investment income, the City of San Bernardino uses all available economically feasible investment aids. Economic conditions and various money markets are monitored i~order to assess the probable course of interest reates. The final basic premise underlying the City of San Bernardino's investment philosophy is to insure the safety of existing funds and insure that they are always readily available when needed.