[HISTORY: Adopted by the Town Board of the Town of Athens 4-10-1995. Amendments noted where applicable.]028a Schedule of Eligible Securities
This investment policy applies to all moneys and other financial resources available for investment on the town's own behalf or on behalf of any other entity or individual.
The primary objectives of the Town of Athens investment activities are, in priority order:
To conform to all applicable federal, state and other legal requirements.
To adequately safeguard the principal investment.
To provide sufficient liquidity to meet all operating requirements and ensure that investments mature when the cash is required to finance operations.
To obtain a competitive and reasonable rate of return on investments.
The Town Board's responsibility for the administration of the investment program is delegated to the Supervisor of the Town of Athens, who shall establish written procedures for the operation of the investment program consistent with these investment guidelines. Such procedure shall include an adequate internal control structure to provide a satisfactory level of accountability based on records incorporating descriptions and amounts of investments, transaction dates and other relevant information and to 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 or conflict of interest that might impair public confidence in the ability of the Town of Athens to govern effectively.
Investments shall be made with judgment and care, under circumstances then prevailing, which persons of prudent 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 which could impair their ability to make impartial investment decisions.
It is the policy of the Town of Athens to diversify its deposits and investments, where possible, by financial institution, by investment instrument and by maturity scheduling where necessary in order to properly secure or collateralize the same.
It is the policy of the Town of Athens for all funds collected by any officer or employee of the town, and which are required to be transferred to the custody of the chief fiscal officer, to be transferred to the custody of the Town Supervisor within 10 business days of receipt or within the time period specified by law.
The Town Supervisor is responsible for establishing and maintaining an internal control structure to provide reasonable, but not absolute, insurance 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 banks and trust companies authorized for the deposit of funds are those designated at the annual organizational meeting of the Town of Athens. The resolution must specify the maximum amount which may be kept on deposit at any time in each bank or trust company.
In accordance with the provisions of the General Municipal Law, all deposits of the town, 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 (see Appendix A) equal to or in excess of the aggregate amount of deposits. Collateral will not be required with respect to the direct purchase of obligations of the State of New York or the United States of America and its federal agencies, the principal and interest of which are guaranteed by the State of New York or the United States government.
Editor's Note: Appendix A is included at the end of this chapter.
Eligible securities used for collateralizing deposits shall be held by the designated depository and/or a third party bank or trust company subject to security and custodial agreements.
The security agreement shall provide that eligible securities are being pledged to secure deposits of the Town of Athens, together with the 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 in the events which will enable the Town of Athens to exercise its rights against the pledged securities. In the event that the securities are not registered or inscribed in the name of the Town of Athens, such securities shall be delivered in a form suitable for transfer or with an assignment in blank to the Town of Athens or its custodial bank.
The custodial agreement shall provide that securities held by the bank or trust company as agent of and custodian for the Town of Athens 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 also describe that the custodian shall confirm the receipt, substitute 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 Town of Athens a perfected interest in the securities.
As authorized by the General Municipal Law, the Town of Athens authorizes the Supervisor to invest moneys not required for immediate expenditure for terms not to exceed its projected cash flow needs in the following types of investments:
Special time deposit accounts issued by a bank or trust company authorized to do business in the State of New York.
Certificates of deposit.
Obligations of the United States of America.
Obligations guaranteed by agencies of the United States of America where the payment of principal and interest is guaranteed by the United States of America.
Obligations of the State of New York, subject to provisions of the General Municipal Law.
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-k, 6-1, 6-m or 6-n.
All investment obligations shall be payable or redeemable at the option of the town 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 Athens within two years of the date of purchase.
The Town of Athens 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 town conducts business must be credit worthy. The Town Supervisor is responsible for evaluating the financial position and maintaining a listing of proposed depositories, trading partners and custodians. Such listings shall be evaluated at least annually.
The Town Supervisor shall be authorized to contract for the purchase of investments. All purchased obligations, unless registered or inscribed in the name of the Town of Athens, 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 Athens 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 the General Municipal Law.
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 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 Athens a perfected interest in the securities.