§ 20-1. Scope.
This investment policy applies to all moneys and other
financial resources available for investment on the Village's own behalf or on
behalf of any other entity or individual.
§ 20-2. Objectives.
The primary objectives of the local government's investment
activities are, in priority order, to conform with all applicable federal, state
and other legal requirements (legal); to adequately safeguard principal
(safety); to provide sufficient liquidity to meet all operating requirements
(liquidity); to obtain a reasonable rate of return (yield).
§ 20-3. Delegation of
authority.
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 description and amounts of investments,
transaction dates, and other relevant information and regulate the activities
of subordinate employees.
§ 20-4. Prudence.
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 New York Mills 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.
§ 20-5.
Diversification.
It is the policy of the Village of New York Mills to
diversify its deposits and investments by financial institution, by investment
instrument, and by maturity scheduling.
§ 20-6. Internal
controls.
A. It is the
policy of the Village of New York Mills for all moneys collected by any officer
or employee of the government to be transferred to the Treasurer within the
time period specified in law.
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,
that transactions are executed in accordance with management's authorization
and recorded properly, and are managed in compliance with applicable laws and
regulations.
§ 20-7. Designation
of depositaries.
The banks and trust companies authorized for the deposit of
moneys up to the following maximum amounts are:
|
Depository Name
|
Maximum Amount
|
Officer
|
|
Fleet Bank
|
$1,000,000
|
Treasurer
|
§ 20-8.
Collateralizing of deposits.
In accordance with the provisions of General Municipal Law
§ 10, all deposits of the Village of New York Mills, 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:
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 the policy.
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 aggregated 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.
§ 20-9. Safekeeping
and collateralization.
A. Eligible
securities used for collateralizing deposits shall be held by Fleet Bank 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 Fleet Bank 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.
§ 20-10. Permitted
investments.
A. As authorized
by General Municipal Law § 11, the Village of New York Mills authorizes
the Treasurer to invest moneys not required for immediate expenditure for terms
not to exceed its projected cash flow needs in the following types of
investments:
(1) Special time
deposit accounts.
(2) Certificate
of deposit.
(3) Obligations
of the United States of America.
(4) Obligations
guaranteed by agencies of the United States of America where the payment of
principal and interest are guaranteed by the United States of America.
(5) Obligations
of the State of New York.
(6) Obligations
issued pursuant to Local Finance Law § 24.00 or 25.00 (with approval of
the State Comptroller) by any municipality, school district or district
corporation other than the Village of New York Mills.
(7) Obligations
of public authorities, public housing authorities, urban renewal agencies and
industrial development agencies where the general state statutes governing such
entities or whose specific enabling legislation authorizes such
investments.
(8) Certificates
of participation (COP's) issued pursuant to General Municipal Law
§ 109-b.
(9) Obligations
of this local government, but only with any money in a reserve fund established
pursuant to General Municipal Law § 6-c, 6-d, 6-e, 6-g, 6-h, 6-j, 6-l,
6-m, or 6-n.
B. All
investment obligations shall be payable or redeemable at the option of the
Village of New York Mills 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 New York Mills within two
years of the date of purchase.
§ 20-11. Authorized
financial institutions and dealers.
The Village of New York Mills 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 New York Mills. 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 depositories, trading partners and custodians. Such listing shall be
evaluated at least annually.
§ 20-12. Purchase of
investments.
A. The Treasurer
is authorized to contract for the purchase of investments:
(1) Directly,
including though a repurchase agreement, from an authorized trading
partner.
(2) By
participation in a cooperative investment program with another authorized
governmental entity pursuant to Article 5-G 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 New York
Mills by the bank or trust company. Any obligation 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 deposits or other liabilities. The agreement shall describe how the
custodian shall confirm the receipts and release of the securities. Such
agreement shall include all provisions necessary to provide the local
government a perfected interest in the securities.
§ 20-13. Repurchase
agreements.
Repurchase agreements are authorized subject to the
following restrictions:
A. All
repurchase agreements must be entered into subject to the 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.
