The purpose of this chapter is to minimize risk; to ensure that
investments mature when the cash is required to finance operations;
and to ensure a competitive rate of return.
Certificate of deposit shall be fully secured by insurance of
the Federal Deposit Insurance Corporation or 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 town. Collateral shall be delivered
to the town or a custodial bank with which the town has entered into
a custodial agreement. The market value of collateral shall at all
times equal or exceed the principal amount of the certificate of deposit.
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.
Written contracts. Written contracts are required for certificates
of deposit and custodial undertakings. With respect to the purchase
of obligations of United States, New York State or other governmental
entities, the interests of the town will be adequately protected by
conditioning payment on the physical delivery of purchased securities
to the town or custodian, or in the case of book-entry transactions,
on the crediting of purchased securities to the custodian's federal
reserve system account. All purchases will be confirmed, in writing,
to the town in the form of a contract as follows:
Investments in time deposits and certificates of deposit are
to be made with banks or trust companies. Their annual reports must
be reviewed by the chief fiscal officer to determine satisfactory
financial strength.
At the time independent auditors conduct the annual audit of
the accounts and financial affairs of the town, the independent auditors
shall audit the investments of the town for compliance with the provisions
of these investment guidelines.
At lest annually, and if practicable, at the organizational
meeting of the Town Board, the Board shall review and amend, if necessary,
these investment guidelines.
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.