[HISTORY: Adopted by the Town Board of the Town of Milo 7-18-1988 (Ch. 19 of the 1997 Code). Amendments noted where applicable.]
The objectives of the investment policy of the local government are to minimize risk; to ensure that investments mature when the cash is required to finance operations; and to ensure a competitive rate of return.
In accordance with this policy, the Milo Town Board designates the following banks and/or trust companies as official depositories: Community Bank; Fleet Bank; and the National Bank of Geneva, in which the Town of Milo Supervisor is hereby authorized to invest all funds, including proceeds of obligations and reserve funds, in:
[Amended 10-27-1997 by L.L. No. 2-1997]
Certificates of deposit issued by a commercial bank or trust company authorized to do business in New York State.
Time deposit accounts in a commercial bank or trust company authorized to do business in New York State.
Obligations of the United States Government.
Obligations of New York State.
Only reserve funds may be invested in obligations of the local government.
All other local government officials receiving money in their official capacity must deposit such funds in negotiable order of withdrawal accounts if such accounts can maintain minimum balances to avoid unnecessary service charges and thus operate efficiently, otherwise to be deposited in least costly checking account.
All investments made pursuant to this investment policy shall comply with the following conditions:
Certificates of deposit shall be fully secured by insurance of the Federal Deposit Insurance Corporation or by obligations of New York State or obligations of the United States or obligations of federal agencies, the principal and interest of which are guaranteed by the United States, or obligations of New York State local governments. Collateral shall be delivered to the local government of a custodial bank with which the local government has entered into a custodial agreement. The market value of collateral shall at all times equal or exceed the principal amount of the certificate of deposit. Collateral that is subject to change shall be monitored no less frequently than weekly and market value shall mean the bid or closing price as quoted in the Wall Street Journal or as quoted by another recognized pricing service.
Collateral shall not be required with respect to the direct purchase of obligations of New York State, obligations of the United States and obligations of federal agencies, the principal and interest of which are guaranteed by the United States Government.
Delivery of securities. Payment shall be made by or on behalf of the local government for obligations of New York State, obligations the principal and interest of which are guaranteed by the United States, United States obligations, certificates of deposit and other purchased securities upon the delivery thereof to the custodial bank, or in the case of a book-entry transaction, when the purchased securities are credited to the custodial bank's federal reserve system account. All transactions shall be confirmed in writing.
Written contracts. Written contracts are required for certificates of deposit and custodial undertakings. With respect to the purchase of obligations of United States, New York State, or other governmental entities, etc., in which moneys may be invested, the interests of the local government will be adequately protected by conditioning payment on the physical delivery of purchased securities to the local government or custodian, or in the case of book-entry transactions, on the crediting of purchased securities to the custodian's federal reserve system account. All purchases will be confirmed in writing to the local government. It is therefore, the policy of the local government, to require written contracts as follows:
Designation of custodial bank. Custodial bank. A commercial bank or trust company as specified in a resolution upon the minutes of the Town Board of Milo and chartered by the State of New York shall be designated to act as custodial bank of the local government's investments. However, securities may not be purchased through a repurchase agreement with the custodial bank.
Financial strength of institutions.
All trading partners must be creditworthy. Their financial statements must be reviewed at least annually by the Chief Fiscal Officer to determine satisfactory financial strength or the Chief Fiscal Officer may use credit rating agencies to determine credit worthiness of trading partners. Concentration of investments in financial institutions should be avoided. The general rule is not to place more than a definite maximum amount as specified by the Town Board of Milo in overnight investments with any one institution. If none is specified then no more than covered by collateral or FDIC insurance.
Investments in time deposits and certificates of deposit are to be made with banks or trust companies. Their annual reports must be reviewed by the Chief Fiscal Officer to determine satisfactory financial strength.
When purchasing eligible securities the seller shall be required to deliver the securities to our custodial bank.
Operations, audit and reporting.
The Chief Fiscal Officer or the Deputy Fiscal Officer shall authorize the purchase and sale of all securities and execute contracts for certificates of deposit on behalf of the local government. Oral directions concerning the purchase or sale of securities shall be confirmed in writing. The local government shall pay for purchased securities upon the delivery or book-entry thereof.
The Chief Fiscal Officer or the Deputy Fiscal Officer shall contact at least two commercial banks or trust companies, authorized to do business in New York State, within the immediate area of the local government, for the purpose of obtaining the best possible rate of return (interest) prior to making any investment.
At any time independent auditors conduct an annual audit of the accounts and financial affairs of the local government, the independent auditors shall audit the investments of the local government for compliance with the provisions of these investment guidelines.
The Governing Board of the local government shall review and approve the annual investment report, if practicable, at its January meeting.
The provisions of these investment guidelines and any amendments hereto shall take effect prospectively and shall not invalidate the prior selection of any custodial bank or prior investment.