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Res 097-86 7/1/1986RESOLUTION NO. 17- 16 RESOLUTION ACCEPTING POLICIES AND RULES FOR THE INVESTMENT OF CITY FUNDS WHEREAS, Resolution Number 67-86 directed the City's Investment Officer to prepare rules governing the investment of local funds ; and WHEREAS, such policies and rules have been prepared and submitted to the City Council for approval ; and WHEREAS, the formal adoption of such rules shall further insure the prudent investment of City funds; NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF WICHITA FALLS, THAT: The following investment policy and associated rules prepared by the Investment Officer of the City of Wichita Falls are hereby approved and adopted. SECTION ONE. INVESTMENT OBJECTIVES The objectives of the City's investment program shall be, in order of priority, safety, liquidity, and yield. Safety of principal shall be the foremost objective of the City's investment program. Each investment transaction shall seek to first insure that capital losses are avoided, whether they be from securities defaults or erosion of market value. Investments shall be made with the judgement and care which a person of prudence, discretion, and intelligence would exercise in the management of his or her own affairs with consideration given to the probable safety of capital as well as the probable income to be derived. Investments shall not be made for speculative purposes. SECTION TWO. AUTHORIZED INVESTMENTS The City shall invest only in those instruments authorized by law by the State of Texas. Insofar as they meet this requirement, the City may invest in the following: U. S. Treasury Bills U. S. Treasury Notes and Bonds Collateralized Certificates of Deposit and other evidences of deposit and national banks and savings and loan associations in the State of Texas where such institutions are under contract with the City as participating depositories Consolidated Certificate of Deposit programs covered under FDIC insurance where the institutions authorizing such programs are . under contract with the City as participating depositories The City Manager is hereby authorized to enter into contracts with financial institutions offering consolidated Certificate of Deposit programs. Such contract shall establish the financial institutions involved as participating depositories of the City of Wichita Falls. 2 Should the State law governing authorized investments be amended to add other investment vehicles , such vehicles shall not be used until such time as they are specifically authorized by action of the City Council of the City of Wichita Falls. SECTION THREE. QUALIFYING INSTITUTIONS Broker/dealers through whom the City purchases U. S. Government securities may include those dealers reporting to the Market Reports Division of the Federal Reserve Bank of New York, also known as the "primary government securities dealers." Other dealers may be approved by the City Council . The City shall evaluate the financial institutions' and broker/dealers ' soundness to the extent necessary to insure the security of the City's invest- ments. Investigation may include, but is not limited to, review of rating agency reports, review of call reports, and analyses of profitability, capitaliza- tion, and asset quality. Institutions with which the City wishes to do business shall provide the financial data requested by the City. Where appropriate to the investment vehicle, participating financial institutions shall have FDIC insurance coverage in the State of Texas. (See attached listing) SECTION FOUR. INVESTMENT PRACTICE--TREASURIES AND DEPOSITS All investments purchased by the City shall be purchased "delivery versus payment. " That is, the City shall authorize release of its funds only after it has received notification from its safekeeping bank that a purchased security has been received in the City's safekeeping account. The City must have con- firmation from its safekeeping bank that collateral pledged from a financial institution is in the City's account before investing in certificates of deposit or other evidences of deposit at the financial institution. Unless otherwise provided for by the City's primary depository agreement, competetive quotations shall always be taken for certificates of deposit and shall be taken for U. S. Treasury security investments as considered prudent by the Chief Accounting Officer/Director of Finance of the City. SECTION FIVE. INDEMNITY Those employees of the City of Wichita Falls who are involved in making investment decisions and in processing the City's investments shall be personally indemnified by the City of Wichita Falls in the event of an investment loss provided that this Investment Policy and the applicable laws of the State of Texas have been followed. SECTION SIX. POLICY REVISIONS This policy may be amended by action of the City Council . The City Manager is authorized to recommend revisions to the City Council whenever such revisions are necessary and prudent due to changes in State law, the needs of the City, the economy, and investment opportunities. SECTION SEVEN. REPORTING Reports of investment activity should be issued on a periodic basis established by City Council. 3 PASSED AND APPROVED this the 1st day of July, 1986. g, • , MAYOR ATTEST: L4,7-444, rA6-rnotd-' 2 APPENDIX A LIST OF THE GOVERNMENT SECURITIES DEALERS REPORTING TO THE MARKET REPORTS DIVISION OF THE FEDERAL RESERVE BANK OF NEW YORK Bankers Trust Company Carroll McEntee & McGinley Incorporated Citibank, N. A. Donaldson, Lufkin & Jenrette Securities Corporation Drexel Burnham Lambert Government Securities, Inc. The First Boston Corporation Goldman, Sachs & Co. E. F. Hutton & Company, Inc. Kidder, Peabody & Co. , Inc. Lehman Government Securities, Inc. Manufacturers Hanover Trust Company Merrill Lynch Government Securities, Inc. Morgan Guaranty Trust Company of New York Morgan Stanley & Co. , Inc. Paine Webber Incorporated Prudential-Bache Securities, Inc. Salomon Brothers, Inc. Smith Barney Government Securities, Inc. Herbert R. Smith, Inc. Thomas-McKinnon Dean Witter Reynolds, Inc. Note: This list has been compiled and made available for statistical purposes only and has no significance with respect to other relation- ships between dealers and the Federal Reserve Bank of New York. Qualifi- cation for the reporting list is based on the achievement and maintenance of reasonable standards of activity.