[HISTORY: Adopted by the Town Board of the Town of Chili 1-4-2006. [1] Amendments noted where applicable.]
ATTACHMENTS
062a Investment Policy Introduction062b App A Sched of Eligible Srcurities
[1]
Editor's Note: The text of the introduction to this resolution is included at the end of this chapter.
A. 
This investment policy applies to all moneys and other financial resources available for short-term investments on behalf of the Town of Chili or on behalf of any other entity or individual.
B. 
Pooling of funds. Except for cash in certain restricted and special funds, the Town of Chili will consolidate cash balances from all funds to maximize investment earnings. Investment income will be allocated to the various funds based on their respective participation and in accordance with generally accepted accounting principles.
The primary objectives of the Town of Chili's investment activities are, in priority order:
A. 
Legal: to conform with all applicable federal, state and other legal requirements;
B. 
Safety: to adequately safeguard principal;
C. 
Liquidity: to provide sufficient liquidity to meet all operating requirements; and
D. 
Yield: 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, or other officer so designated, having custody of money, 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 safekeeping, accountability based on a database or records incorporating description and amounts of investments, transaction dates, and other relevant information and regulate the activities of subordinate employees. No person may engage in an investment transaction except as provided under the terms of this policy and the procedures established by the investment officer. The investment officer shall be responsible for all transactions undertaken and shall establish a system of controls to regulate the activities of subordinate officials.
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 Town of Chili 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.
It is the policy of the Town of Chili to diversify its deposits and investments by financial institution, by investment instrument, and by maturity scheduling.
A. 
It is the policy of the Town of Chili for all moneys collected by any officer or employee of the government to transfer those funds to the Chief Fiscal Officer, or other officer so designated, having custody of money, within the number of days indicated below, or within the time period specified in law, whichever is shorter.
(1) 
Tax Collector: within 15 calendar days of collection.
(2) 
Town Clerk: within 15 calendar days after the month of collection.
(3) 
Recreation: within five business days of collection.
B. 
The Chief Fiscal Officer, or other officer so designated, having custody of money, is responsible for establishing and maintaining an internal control structure designed to ensure that assets of the Town of Chili are protected from loss, theft or misuse. The internal control structure shall be designed to provide reasonable assurance that these objectives are met. The concept of reasonable assurance recognizes that the cost of a control should not exceed the benefits likely to be derived and the valuation of costs and benefits requires estimates and judgments by management.
C. 
Accordingly, the investment officer shall establish a process for an annual independent review by an external auditor to assure compliance with policies and procedures. The internal controls shall address the following points:
(1) 
Control of collusion.
(2) 
Separation of transaction authority from accounting and recordkeeping.
(3) 
Custodial safekeeping.
(4) 
Avoidance of physical delivery securities.
(5) 
Clear delegation of authority to subordinate staff members.
(6) 
Written confirmation of transactions for investments and wire transfers.
(7) 
Development of a wire transfer agreement with the lead bank and third-party custodian.
The banks and trust companies authorized for the deposit of monies, as designated at the Town of Chili Town Board's reorganization meeting each year, are only commercial banks licensed to do business in the State of New York.
In accordance with the provisions of General Municipal Law § 10, all deposits of Town of Chili, 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 of 105%, or provided by General Municipal Law § 10, equal to 105% the aggregate amount of deposits from the categories designated in Appendix A to the policy. [1]
[1]
Editor's Note: Said Appendix A is included at the end of this chapter.
A. 
Eligible securities used for collateralizing deposits shall be held by a third party 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 the Town of Chili 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.
A. 
As authorized by General Municipal Law § 11, the Town of Chili authorizes the Chief Fiscal Officer, or other officer so designated, having custody of money, 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 authorized to do business in New York State;
(2) 
Certificates 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 Town of Chili.
(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) 
Obligations of this local government, but only with any moneys in a reserve fund established pursuant to General Municipal Law §§ 6-c, 6-d, 6-e, 697g, 6-h, 697j, 6-k, 6-1, 6-m, or 6-n.
B. 
All investment obligations shall be payable or redeemable at the option of the Town of Chili with in 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 Chili within two years of the date of purchase. The designated depository will confirm all purchases and transactions in writing to the Town of Chili.
The Town of Chili 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 (call report) at the request of the Town of Chili. 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 Chief Fiscal Officer, or other officers so designated, having custody of money, 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 Chief Fiscal Officer, or other officers so designated, having custody of money, is authorized to contract for the purchase of investments:
(1) 
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 Town Board.
(2) 
By utilizing an ongoing investment program with an authorized tracking partner pursuant to a contract authorized by the Town 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 Town of Chili 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 Town of Chili, 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 Town of Chili a perfected interest in the securities.
A. 
The Chief Fiscal Officer, or other officer so designated, having custody of money, shall authorize the purchase and sale of all securities and execute contracts on behalf of the Town of Chili. Oral directions concerning the purchase, transaction, or sale of securities shall be confirmed in writing. The Town of Chili shall pay for purchased securities upon delivery.
B. 
The Town of Chili will encourage the purchase and sale of securities through a competitive or negotiated process involving telephone solicitations of at least three bids for each transaction.
C. 
At the time independent auditors conduct the annual financial audit of the accounts and affairs of the Town of Chili, the auditors shall audit compliance with the investment guidelines.
D. 
Within 60 days of the end of each of the first three quarters of the fiscal year, the Chief Fiscal Officer, or other officer so designated, having custody of money, shall prepare and submit to the Town Board a quarterly investment report which indicates new investments, the inventory of existing investments, and such other matters as the Chief Fiscal Officer deems necessary.
E. 
Within 120 days of the end of the fiscal year, the Chief Fiscal Officer, or other officer so designated, having custody of money, shall prepare and submit to the Town Board an annual investment report; recommendations for change in these investment guidelines; the result of the independent audit; the commission of other charges, if any, paid to the custodial bank and such other matters as deemed appropriate by the Chief Fiscal Officer, or other officer so designated, having custody of money.
F. 
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.