HomeMy WebLinkAboutReso 002-89 InvestmentPolicyRESOLUTION NO. 2 - 89
A RESOLUTION OF THE CITY COUNCIL
OF THE CITY OF DUBLIN
SETTING FORTH THE
INVESTMENT POLICY FOR THE CITY OF DUBLIN
FOR 1989
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 resolution.
NOW, THEREFORE, BE IT RESOLVED that the City Council of the
City of Dublin does hereby adopt the Investment Policy for1989.
PASSED, APPROVED AND ADOPTED this 9th day of January, 1989.
AYES:
Councilmembers Hegarty, Jeffery, Snyder, Vonheeder
and Mayor Moffatt
NOES: None
ATTEST:
ABSENT: None
City
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 an 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.
1. 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), and savings accounts
must be insured by FSLIC, FDIC, or collateralized.
Bankers acceptances must be secured by the irrevocable
primary obligation of the accepting domestic 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. Commercial
paper of "prime" quality from a domestic corporation
having total assets in excess of five hundred million
dollars and an "A" rating or higher shall be considered
as a safe investment. Only money market account that
have 100% of their assets invested in Federal Notes,
and Federal Bills shall be considered safe.
2. 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.
3. 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.