Town of Sweden, NY
Monroe County
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Table of Contents
Table of Contents
[HISTORY: Adopted by the Town Board of the Town of Sweden 11-23-1999[1] Amendments noted where applicable.]
Editor's Note: This resolution superseded former Ch. 26, Investment Policy, adopted 3-23-1988.
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 Town of Sweden's investment activities are, in priority order:
To conform to all applicable federal, state and other legal requirements.
To adequately safeguard principal.
To provide sufficient liquidity to meet all operating requirements.
To obtain a reasonable rate of return.
The Town Board's responsibility for administration of the investment program is delegated to the chief fiscal officer, 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 database or records incorporating a description and amounts of investments, transaction dates, and other relevant information and regulate the activities of subordinate employees.
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 Town of Sweden to govern effectively.
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.
All participants involved in the investment process shall refrain from personal business activity that could conflict with proper execution of the investment program or that could impair their ability to make impartial investment decisions.
It is the policy of the Town of Sweden to diversify its deposits and investments by financial institution, by investment instrument, and by maturity schedule.
It is the policy of the Town of Sweden for all moneys collected by any officer or employee of the government to be transferred to the chief fiscal officer within 30 days of deposit, or within the time period specified in law, whichever is shorter.
The chief fiscal officer 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.
The Town Board, from time to time, consistent with state law, shall determine the banks and maximum amount in each account authorized for the deposit of moneys.
In accordance with the provisions of General Municipal Law § 10, all deposits of the Town of Sweden, 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 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.[1] Eligible securities used for collateralizing deposits shall be held by the depository bank subject to security and custodial agreements.
Editor's Note: Appendix A is included at the end of this chapter.
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 pledge 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.
The custodial agreement shall provide that securities held by the bank, or agent of and custodian for the local government, will be kept separate and apart from the general assets of the custodial bank 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.
As authorized by General Municipal Law § 11, the Town of Sweden authorizes the chief fiscal officer to invest moneys not required for immediate expenditure for terms not to exceed its projected cash flow needs in the following types of investments:
Certificates of deposit.
Special time deposit accounts.
Obligations of the United States of America.
Obligations of the State of New York.
All investment obligations shall be payable or redeemable at the option of the Town of Sweden 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 Town of Sweden within two years of the date of purchase.
The Town of Sweden 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 credit worthy. Banks shall provide their most recent Consolidated Report of Condition at the request of the Town of Sweden. 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.
Appendix A
Schedule of Eligible Securities
Obligations issued, or fully insured or guaranteed as to the payment of principal and interest, by the United States of America, an agency thereof or a United States government sponsored corporation.
Obligations issued or fully guaranteed by the International Bank for Reconstruction and Development, the Inter-American Development Bank, the Asian Development Bank, and the African Development Bank.
Obligations partially insured or guaranteed by any agency of the United States of America, at a proportion of the market value of the obligation that represents the amount of the insurance or guaranty.
Obligations issued or fully insured or guaranteed by the State of New York, obligations issued by a municipal corporation, school district or district corporation of such state or obligations of any public benefit corporation which under a specific state statute may be accepted as security for deposit of public moneys.
Obligations issued by states (other than the State of New York) of the United States rated in one of the three highest rating categories by at least one nationally recognized statistical rating organization.
Obligations of Puerto Rico rated in one of the three highest rating categories by at least one nationally recognized statistical rating organization.
Obligations of counties, cities and other government entities of a state other than the State of New York having the power to levy taxes that are backed by the full faith and credit of such governmental entity and rated in one of the three highest rating categories by at least one nationally recognized statistical rating organization.
Obligations of domestic corporations rated in one of the two highest rating categories by at least one nationally recognized statistical rating organization.
Any mortgage-related securities, as defined in the Securities Exchange Act of 1934, as amended, which may be purchased by banks under the limitations established by bank regulatory agencies.
Commercial paper and bankers' acceptances issued by a bank, other than the bank, rated in the highest short-term category by at least one nationally recognized statistical rating organization and having maturities of not longer than 60 days from the date they are pledged.
Zero coupon obligations of the United States government marketed as "Treasury Strips."