This investment policy applies to all moneys and other financial
resources for the deposit and investment by the Town of Waterford
on its own behalf or on behalf of any other entity or individual.
The primary objectives of the local government's investment
activities are, in priority order:
A. To conform with all applicable federal, state and other legal requirements
(legality);
B. To adequately safeguard principal (safety);
C. To provide sufficient liquidity to meet all operating requirements
(liquidity); and
D. To obtain a reasonable rate of return (yield).
The governing 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 policies. Such procedures shall include
internal controls to provide a satisfactory level of accountability
based upon records incorporating the description and amounts of investments,
the fund(s) for which they are held, the place(s) where kept, and
other relevant information, including dates of sale or other disposition
and amounts realized. In addition, the internal control procedures
shall describe the responsibilities and levels of authority for key
individuals involved in the investment program.
The banks that are authorized for the deposit of moneys, and
the maximum amount which may be kept on deposit at any time, are:
Depository Name
|
Maximum Amount
|
Officer
|
---|
Pioneer Commercial Bank
|
$15,000,000
|
Government Accounts
|
All deposits and investments at Pioneer Commercial Bank, including
all demand deposits, certificates of deposit and special deposits
(hereinafter, collectively, "deposits") made by officers of the Town
of Waterford that are in excess of the amount insured under the provisions
of the Federal Deposit Insurance Act, including pursuant to a deposit
placement program in accordance with law, shall be secured by:
A. A pledge of eligible securities with an aggregate market value (as
provided by General Municipal Law § 10) that is at least
equal to the aggregate amount of deposits by the officers. See Schedule
A of this policy for a listing of eligible securities.
B. An irrevocable letter of credit issued in favor of the Town of Waterford
by a federal home loan bank whose commercial paper and other unsecured
short-term debt obligations are rated in the highest rating category
by at least one nationally recognized statistical rating organization,
as security for the payment of 100% of the aggregate amount of deposits
and the agreed-upon interest, if any.
Eligible securities used for collateralizing deposits made by
officers of the Town of Waterford shall be held by Pioneer Commercial
Bank or a third party, subject to security and custodial agreements.
A. The security agreement shall provide that eligible securities are
being pledged to secure such deposits together with agreed-upon interest,
if any, and any costs or expenses arising out of the collection of
such deposits upon a default. It shall also provide the conditions
under which the securities held may be sold, presented for payment,
substituted or released and the events of default which will enable
the local government to exercise its rights against the pledged securities.
B. In the event that the pledged securities are not registered or inscribed
in the name of the Town of Waterford, such securities shall be delivered
in a form suitable for transfer or with an assignment in blank to
the Town of Waterford or its custodial bank. Whenever eligible securities
delivered to the custodial bank are transferred by entries on the
books of a federal reserve bank or other book-entry system operated
by a federally regulated entity without physical delivery of the evidence
of the obligations, then the records of the custodial bank shall be
required to show, at all times, the interest of the local government
in the securities as set forth in the security agreement.
C. The custodial agreement shall provide that pledged securities will
be held by the custodial bank as agent of, and custodian for, the
Town of Waterford, will be kept separate and apart from the general
assets of the custodial bank and will not commingled with or become
part of the backing of any other deposit or other bank liability.
The agreement shall also describe how the custodian shall confirm
the receipt, substitution or release of the collateral and it shall
provide for the frequency of revaluation of collateral by the custodial
bank and for the substitution of collateral when a change in the rating
of a security causes ineligibility. The security and custodial agreements
shall also include all other provisions necessary to provide the Town
of Waterford with a perfected security interest in the eligible securities
and to otherwise secure the local government's interest in the collateral,
and may contain other provisions that the governing board deems necessary.
The Town of Waterford shall review this investment policy annually,
and it shall have the power to amend this policy at any time.
The terms "public funds," "public deposits," "bank," "trust
company," "eligible securities," "eligible surety bond," and "eligible
letter of credit" shall have the same meanings as set forth in General
Municipal Law § 10.