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HomeMy WebLinkAboutReso 142-86 Investment Policy87RESOLUTION NO. 142 - 86 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF DUBLIN SETTING FORTH THE INVESTMENT POLICY FOR THE CITY OF DUBLIN FOR 1987 WHEREAS, the City has a fiduciary responsibility to maximize the productive use of assets entrusted to its care and to invest and manage those public funds prudently; and WHEREAS, the General Law City of Dublin operates its pooled idle cash under the prudent man's rule; and WHEREAS, the City shall strive to make investments that benefit the loCal area; and WHEREAS, Exhibit "A" sets forth the details of the Investment Policy for the City of Dublin and is incorporated as part of this resolutions. NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Dublin does hereby adopt the Investment Policy for 1987. 1986. PASSED, APPROVED AND ADOPTED this 22nd day of December, AYE S: Councilmembers Hegarty, Moffatt, Snyder, Vonheeder and Mayor Jeffery NOES: None ABSENT: None City ~l~rk EXHIBIT "A" CITY OF DUBLIN STATEMENT OF INVESTMENT POLICY AND STRATEGY CITY OF DUBLIN STATEMENT OF INVESTMENT POLICY Introduction The availability of cash on a short term basis in the City of Dublin treasury offers an opportunity for a substantial amount of revenue to be generated by a prudent investment program. A growing number of investment instruments makes it imperative that the City establish a policy for managing its investment portfolio. With first concern being for the safety of principal and the second to provide additional earnings, the following investment policy is hereby authorized: ~ Policy Realizing that the Treasurer's first responsibility is to retain sufficient cash to pay existing debts, it is the policy of the City of Dublin to invest the maximum amount of idle cash available to the City in order to generate interest earnings to supplement other City revenue sources. The investment program is subject to the following parameters presented in the order of importance. Safety. The first priority for the investment program shall be the safety of principal investment. Speculation or risky investment media will be avoided even though high interest rates might be offered. Basic consideration for safety shall include: Government and agency paper and repurchase agreements are the highest quality investment available in terms of safety and liquidity. Certificates of deposit (negotiable and non-negotiable), savings accounts must be insured by FSLIC, FDIC or collateralized. Banks acceptances must be secured as the irrevocable primary obligation of the accepting bank. The Local Agency Investment Fund shall be considered as a proper investment for safety inasmuch as the State Treasurer of California is the State Elected Officer responsible for that investment portfolio. Liquidity - Spacing Maturity. Investments must be carefully coordinated with the City's periodic cash needs. It is urgent that current available cash not be assigned to an investment with a time commitment which will result in the shortage of cash for either operations or capital purposes at some future time. The need for liquidity will take precedence over the higher rates of interest often offered with longer term investments. Basic considerations for liquidity shall include: Most of the investments listed in Paragraph ~1 are highly liquid (there is a good secondary market for selling the investments), with the exception of certificates of deposits held by banks and savings and loans. Maturities of certificates of deposits shall be selected to anticipate cash needs, thereby avoiding the need for forced liquidation. Maximum Earnings. After exercising maximum safety in investment instruments and responsible spacing of maturity, every effort shall then be made to obtain the highest earnings from investments of City money within the limits prescribed by State Law for local government investments. The City shall lengthen its maturities when rates are falling and shorten maturities when rates are rising. The City shall attempt to take advantage of imperfections in the market where a security's price is out of line with other similar investments always keeping an eye towards safety. The Treasurer shall comply with the reporting procedures and format as provided by Assembly Bill No. 1073 enacted into law September 17, 1984. As required by this legislation, the City's investment policy shall be reviewed annually by the City Council.