[HISTORY: Adopted by the Board of Trustees
of the Village of Scottsville 10-11-1994. Amendments noted where applicable.]
GENERAL REFERENCES
Code of Ethics — See Ch. 17.
This investment policy applies to all moneys
and other financial resources available for investment on its own
behalf or on behalf of any other entity or individual.
The primary objectives of the local government's
investment activities are, in priority order, to:
The governing board's responsibility for administration
of the investment program is delegated to the Treasurer, who shall
establish written procedures for the operation of the investment program
consistent with these investment guidelines. Such procedures shall
include an adequate internal control structure to provide a satisfactory
level of accountability based on a data base or records incorporating
the description and amounts of investments, transaction dates and
other relevant information and to regulate the activities of subordinate
employees.
A.
All participants in the investment process shall seek
to act responsibly as custodians of the public trust and shall avoid
any transaction that might impair public confidence in the Village
of Scottsville to govern effectively.
B.
Investments shall be made with judgment 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 safety of
the principal as well as the probable income to be derived.
C.
All participants 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.
A.
It is the policy of the Village of Scottsville for
all moneys collected by any officer or employee of the government
to transfer those funds to the chief fiscal officer within five days
of deposit or within the time period specified in law, whichever is
shorter.
B.
The Treasurer is responsible for establishing and
maintaining an internal control structure to provide reasonable, but
not absolute, assurance that deposits and investments are safeguarded
against loss from unauthorized use or disposition and that transactions
are executed in accordance with management's authorization and recorded
properly and are managed in compliance with applicable laws and regulations.
[Amended 4-3-1995[1]]
The approved list of depositors of the Village
of Scottsville to which funds may be invested is on file in the Village
Clerk's office.
In accordance with the provisions of General
Municipal Law § 10, all deposits of the Village of Scottsville,
including certificates of deposit and special time deposits, in excess
of the amount insured under the provisions of the Federal Deposit
Insurance Act shall be secured as follows:
A.
By a pledge of eligible securities with an aggregate market value or provided by General Municipal Law § 10 equal to the aggregate amount of deposits from the categories designated in Appendix A to this policy.[1]
[1]
Editor's Note: Appendix A is located at the end of this chapter.
B.
By an eligible irrevocable letter of credit issued
by a qualified bank other than the bank with the deposits in favor
of the government for a term not to exceed 90 days with an aggregate
value equal to 140% of the aggregate amount of deposits and the agreed-upon
interest, if any. A qualified bank is one whose commercial paper and
other unsecured short-term debt obligations are rated in one of the
three highest rating categories by at least one nationally recognized
statistical rating organization or by a bank that is in compliance
with applicable federal minimum risk-based capital requirements.
C.
By an eligible surety bond payable to the government
for an amount at least equal to 100% of the aggregate amount of deposits
and the agreed-upon interest, if any, executed by an insurance company
authorized to do business in New York State, whose claims-paying ability
is rated in the highest rating category by at least two nationally
recognized statistical rating organizations.
A.
Eligible securities used for collateralizing deposits
shall be held by (the depositary and/or a third party) bank or trust
company subject to security and custodial agreements.
B.
The security agreement shall provide that eligible
securities are being pledged to secure local government deposits,
together with agreed-upon interest, if any, and any costs or expenses
arising out of the collection of such deposits upon default. It shall
also provide the conditions under which the securities may be sold,
presented for payment, substituted or released and the events which
will enable the local government to exercise its rights against the
pledged securities. In the event that the securities are not registered
or inscribed in the name of the local government, such securities
shall be delivered in a form suitable for transfer or with an assignment
in blank to the depository or its custodial bank.
C.
The custodial agreement shall provide that securities
held by the bank or trust company or agent of and custodian for the
local government will be kept separate and apart from the general
assets of the custodial bank or trust company and will not, in any
circumstances, be commingled with or become part of the backing for
any other deposit or other liabilities. The agreement should also
describe that the custodian shall confirm the receipt, substitution
or release of the securities. The agreement shall provide for the
frequency of revaluation of eligible securities and for the substitution
of securities when a change in the rating of a security may cause
ineligibility. Such agreement shall include all provisions necessary
to provide the local government a perfected interest in the securities.
B.
Investments may be made only in commercial banks and
the United States government and must be collateralized to the extent
that amounts exceed Federal Deposit Insurance Corporation (FDIC) Insurance.
[Amended 4-3-1995]
C.
All investment obligations shall be payable or redeemable
at the option of the Village of Scottsville within such times as the
proceeds will be needed to meet expenditures for purposes for which
the moneys were provided and, in the case of obligations purchased
with the proceeds of bonds or notes, shall be payable or redeemable
at the option of the Village of Scottsville within two years of the
date of purchase.
The Village of Scottsville shall maintain a
list of financial institutions and dealers approved for investment
purposes and establish appropriate limits to the amount of investments
which can be made with each financial institution or dealer. All financial
institutions with which the local government conducts business must
be creditworthy. Banks shall provide their most recent Consolidated
Report of Condition (Call Report) at the request of the Village of
Scottsville. Security dealers not affiliated with a bank shall be
required to be classified as reporting dealers affiliated with the
New York Federal Reserve Bank as primary dealers. The Treasurer is
responsible for evaluating the financial position and maintaining
a listing of proposed depositaries, trading partners and custodians.
Such listing shall be evaluated at least annually.
A.
The Treasurer is authorized to contract for the purchase
of investments as follows:[1]
(1)
Directly, including through a repurchase agreement,
from an authorized trading partner.
(2)
By participation in a cooperative investment program
with another authorized governmental entity pursuant to Article 5G
of the General Municipal Law where such program meets all the requirements
set forth in the Office of the State Comptroller Opinion No. 88-46,
and the specific program has been authorized by the governing board.
(3)
By utilizing an ongoing investment program with an
authorized tracking partner pursuant to a contract authorized by the
governing board.
B.
All purchased obligations, unless registered or inscribed
in the name of the local government, shall be purchased through, delivered
to and held in the custody of a bank or trust company. Such obligations
shall be purchased, sold or presented for redemption or payment by
such bank or trust company only in accordance with prior written authorization
from the officer authorized to make the investment. All such transactions
shall be confirmed, in writing, to the Village of Scottsville by the
bank or trust company. Any obligations held in the custody of a bank
or trust company shall be held pursuant to a written custodial agreement
as described in General Municipal Law § 10.
C.
The custodial agreement shall provide that securities
held by the bank or trust company, as agent of and custodian for the
local government, will be kept separate and apart from the general
assets of the custodial bank or trust company and will not, in any
circumstances, be commingled with or become part of the backing for
any other deposit or other liabilities. The agreement shall describe
how the custodian shall confirm the receipt and release of the securities.
Such agreement shall include all provisions necessary to provide the
local government a perfected interest in the securities.
Repurchase agreements are authorized subject
to the following restrictions:
A.
All repurchase agreements must be entered into subject
to a master repurchase agreement.
B.
Trading partners are limited to banks or trust companies
authorized to do business in New York State and primary reporting
dealers.
C.
Obligations shall be limited to obligations of the
United States of America and obligations of agencies of the United
States of America where principal and interest are guaranteed by the
United States of America.
D.
No substitution of securities will be allowed.
E.
The custodian shall be a party other than the trading
partner.
