[HISTORY: Adopted by the Board of Trustees of the Village
of Sloan 4-11-2006. Amendments
noted where applicable.]
A.
The objectives of the investment policy of the Village of Sloan are
to minimize risk, to ensure that investments mature when the cash
is required to finance operations, and to ensure a competitive rate
of return. In accordance with this policy, the Treasurer is hereby
authorized to invest all funds, including proceeds of obligations,
and reserve funds in:
(1)
Certificates of deposit issued by a bank or trust company authorized
to do business in the United States.
(2)
Time deposit accounts in a bank or trust company authorized to do
business in New York State and the United States.
(3)
Obligations of New York State.
(4)
In repurchase agreements involving the purchase and sale of direct
obligations of the United States.
B.
All other local government officials receiving money in their official
capacity must deposit such funds in negotiable order of withdrawal
accounts.
All investments made pursuant to this investment policy shall
comply with one or more of the following conditions:
A.
Collateral.
(1)
Certificates of deposit shall be fully secured by insurance of the
federal deposit insurance corporations by obligations of New York
State or obligations of the United States or obligations of federal
agencies, the principal and interest of which are guaranteed by the
United States, or obligations of New York State local governments.
A letter of communication shall be obtained from an officer of the
bank stating such collateral is obtained, and the Treasurer's signature
is required to release such collateral. The market value of collateral
shall at all times equal or exceed 105% of the principal amount of
certificate of deposit.
(2)
Collateral shall not be required with respect to the direct purchase
of obligations of New York State, obligations of the United States,
and obligations of federal agencies, the principal and interest of
which are guaranteed by the United States government.
B.
Written contracts. Written contracts shall be required for all repurchase
agreements. Only credit-worthy banks and primary reporting dealers
shall be qualified to enter into a repurchase agreement with the Village
of Sloan. The written contract shall provide that only obligations
of the United States may be purchased, and the Village of Sloan shall
make payment upon delivery of the securities or appropriate book-entry
of the purchased securities. No specific repurchase agreement shall
be entered into unless a master repurchase agreement has been executed
between the Village and the trading partners. While the term of the
master repurchase agreement may be for a reasonable length of time,
a specific repurchase agreement shall not exceed 60 days.
C.
Financial strength of institutions.
(1)
All trading partners must be credit-worthy. Concentration of investments
in financial institutions should be avoided. The general rule is not
to place more than $2,000,000 in overnight investments with any one
institution.
(2)
Investments in time deposits and certificates of deposit are to be
made with banks, trust companies, and major brokerage houses.
(3)
Repurchase agreements shall be entered into only with banks or trust
companies or registered and primary reporting dealers in government
securities. Sound credit judgments must be made with respect to trading
partners in repurchase agreements. It is not assumed that inclusion
on a list of the Federal Reserve is automatically adequate evidence
of credit-worthiness.
(4)
Repurchase agreements should not be entered into with undercapitalized
trading firms.
(5)
A margin of 5% or higher of the market value of purchased securities
in repurchase agreements must be maintained.
D.
Operations, audit and reporting.
(1)
The Treasurer shall authorize the purchase and sale of all securities
and execute contracts for repurchase agreements and certificates of
deposit on behalf of the Village. Oral directions concerning the purchase
or sale of securities shall be confirmed in writing. The Village shall
pay for purchased securities upon the delivery or book-entry thereof.
(2)
The Village will encourage the purchase and sale of securities and
certificates of deposit through a competitive or negotiated process
involving telephone solicitation of at least three bids for each transaction.
(3)
The independent auditors shall audit the investments of the Village
for compliance with the provisions of these investment guidelines.
(4)
The Treasurer shall maintain adequate records of investments. These
records shall be made available to the Village Board of Trustees.
(5)
This policy is effective immediately and is pursuant to an annual
review at the April reorganization meeting of the Board of Trustees.
