The city shall be on a fiscal year commencing on October 1 of
each year and terminating on September 30 of each year.
(2004 Code, sec. 34.01)
(a)
Property disposal agent.
The city manager or designee
shall serve as city property disposal agent.
(b)
Procedures.
In selling or otherwise disposing of any
surplus city property, except for garbage, trash or otherwise, the
following procedures shall be followed. Nothing herein shall be construed
so as to prevent the city council from providing for alternate methods
of disposing of specific pieces of surplus property by means of competitive
bidding for sale to the highest bidder.
(1)
Surplus property listing.
The property disposal agent
shall prepare a list of surplus property certifying items of city
property to be surplus items which are not needed for the continuance
or start-up of city services or other activities. The list shall also
contain an estimated market value on each item or group of items for
disposal, which shall in no event be an amount less than current scrap
value.
(2)
Method of sale.
The property disposal agent is authorized
to sell surplus personal property by any of the following methods:
(A)
A public auction held on-site or through the internet and conducted
by an auctioneer licensed by the state . The property disposal agent
shall give notice in a newspaper of general circulation advertising
the date, time, manner and place of sale, method of payment and a
general description of the items for sale. All sales shall be to the
highest bidder, unless determined by the property disposal agent to
be not sufficient. Each sale shall be recorded, including the name
and address of the purchaser, item or items purchased and the amount
paid. Each purchaser shall receive a receipt for his or her purchases.
(B)
Offer the surplus property as a trade-in for new property of the
same general type if the property disposal agent considers that action
to be in the best interest of the city.
(C)
Recycle the surplus property at an appropriate facility.
(D)
Competitive sealed bid in accordance with ch. 252, Tex. Loc. Gov’t
Code.
(E)
Order any of the surplus property to be destroyed or otherwise disposed
of as worthless, if the city undertakes to the sell that property
and is unable to do so.
(3)
Payment for items purchased.
Payment for items purchased
shall be by cash at the time of sale. In no event shall a receipt
be issued or merchandise delivered until payment is made. All sales
shall be final at the time the gavel falls at auction and after payment
is made. Failure to pay for items at the time of sale shall render
the sale null and void.
(c)
Sale to city employees.
The property disposal agent
is authorized to create a policy for selling surplus property to employees
for fair market value.
(2004 Code, sec. 35.03; Ordinance 2022-101 adopted 9/13/2022)
(a)
The
purpose of this division is to identify various policies and procedures
that enhance opportunities for a prudent and systematic investment
process. The initial step toward a prudent investment policy is to
organize and formalize investment-related activities.
(c)
This
investment policy applies to all transactions involving the financial
assets and related activity of all the foregoing funds.
(2004 Code, sec. 34.15)
The following are the investment objectives of the city:
(1)
Safety
of principal is the foremost objective of the city, followed by liquidity
and yield. Each investment transaction shall seek first to ensure
that capital losses are avoided, whether they be from securities defaults
or erosion of market value.
(2)
Investment
decisions should not incur unreasonable investment risks in order
to obtain investment income.
(3)
The
city’s investment portfolio will remain sufficiently liquid
to enable the city to meet all operating requirements which can be
reasonably anticipated.
(4)
The
city will diversify its investments in an effort to avoid incurring
unreasonable and avoidable risks regarding specific security types
or individual financial institutions.
(5)
The
city will not make investments for the purpose of trading or speculation
as the dominant criteria, such as anticipating an appreciation of
capital through changes in market interest rates.
(6)
The
city adheres to the guidance provided by the “prudent person”
rule, which obligates a fiduciary to ensure that: “... investments
shall be made with the exercise of that degree of 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 probable safety
of their capital as well as the probable income to be derived.”
(7)
(A)
The investment portfolio of the city shall be designed to attain
a market-average rate of return throughout budgetary and economic
cycles, taking into account the city’s investment risk constraints
and the cash flow characteristics of the portfolio.
(B)
The T-bill index, as published in “Public Investor,”
shall be used as a market average rate of return. This index is considered
a benchmark for riskless investment transactions and therefore establishes
a minimum standard for the portfolio’s rate of return. The investment
program shall seek to augment returns above this threshold, consistent
with risk limitations identified herein and prudent investment principles.
(8)
In
managing its investment portfolio, the city will specifically avoid
any purchase of investments or any practice or procedure not specifically
authorized under the terms of this division.
(9)
The
city will comply with federal and state regulations governing the
investment of funds.
(10)
The city intends to pursue active portfolio management techniques
while working within the guidelines of its investment policy in order
to enhance total returns.
(11)
All participants in the investment program will seek to act responsibly
as custodians of the public trust. Investment officials will avoid
any transaction that might impair public confidence in the city’s
ability to govern effectively. Investment officials shall recognize
that the investment portfolio is subject to public review and evaluation.
The overall program shall be designed and managed with a degree of
professionalism which is worthy of the public trust. Nevertheless,
the city recognizes that, in a diversified portfolio, occasional measured
losses are inevitable and must be considered within the context of
the overall portfolio’s investment return, provided that adequate
diversification has been implemented.
(2004 Code, sec. 34.16)
(a)
Management
responsibility for the investment program has been delegated to the
secretary or, in his or her absence, the city administrator, who shall
establish written procedures for the operation of the investment program,
consistent with this investment policy.
(b)
No
person may engage in an investment transaction, except as provided
under the terms of this policy and the procedures established by the
secretary.
(2004 Code, sec. 34.17)
(a)
The
secretary shall establish a system of internal controls which shall
be documented in writing.
(b)
The
controls shall be designed to prevent losses of public funds arising
from fraud, employee error, misrepresentation by third parties, unanticipated
changes in financial markets or imprudent actions by investment officials.
(c)
Controls
deemed most important would include: control of collusion, separation
of duties, separating transaction authority from accounting and recordkeeping,
custodial safekeeping, avoidance of bearer-form securities, clear
delegation of authority, specific limitations regarding securities
losses and remedial action, written confirmation of telephone transactions,
minimizing the number of authorized investment officials and documentation
of and rationale for transactions to the extent that a small city
is capable.
(2004 Code, sec. 34.18)
(a)
The
standard of prudence to be used by investment officers shall be the
“prudent person” rule and shall be applied in the context
of managing an overall portfolio.
(b)
The
investment officer, acting in accordance with written procedures and
exercising due diligence, shall not be held personally responsible
for a specific security’s risk or market price changes, provided
that these deviations are reported immediately and that appropriate
action is taken to control adverse developments.
(2004 Code, sec. 34.19)
(a)
Investment
instruments, authorized for purchase by the city, include:
(1)
U.S. Treasury obligations;
(2)
Obligations of U.S. government agencies; and
(3)
FDIC insured or fully collateralized certificates of deposit issued
by national banks domiciled in the state. Acceptable collateral includes
obligations of the United States or its agencies and instrumentalities;
direct obligations of the state; and obligations of agencies, counties,
cities and other political subdivisions of the state having been rated
as to investment quality by a nationally recognized investment rating
firm and having received a rating of “A” or its equivalent.
(c)
The
city is prohibited from entering into the following transactions:
(2004 Code, sec. 34.20)
To protect against potential fraud and embezzlement, the assets
of the city shall be secured through safekeeping agreements. Investment
officials shall be bonded to protect against possible embezzlement
and malfeasance.
(2004 Code, sec. 34.21)
(a)
(1)
The city recognizes that investment risks can result from issuer
defaults, market price changes or various technical complications
leading to temporary illiquidity.
(2)
Portfolio diversification shall be employed as a way to control risk.
(3)
Investment officers are expected to display prudence in the selection
of securities as a way to minimize default risk.
(4)
No individual investment transaction shall be undertaken which jeopardizes
the total capital position of the overall portfolio.
(b)
To
control market price risks, volatile investment instruments shall
be avoided.
(c)
Nonmarketable
instruments with maturities beyond one month shall not exceed 30%
of the portfolio.
(1)
All investment funds shall be placed directly with qualified financial
institutions, as discussed below. The city shall not deposit or invest
funds through third parties or money brokers.
(2)
All transactions shall be executed on a delivery versus payment basis
unless otherwise specified.
(3)
A competitive offer or bid process utilizing a minimum of three offers
or bids will be used to purchase or sell government securities.
(4)
Before accepting funds or engaging in investment transactions with
the city, officials of qualified depositories and securities dealers
shall be required to familiarize themselves and acknowledge receipt
of the city’s investment policies, objectives and constraints.
(2004 Code, sec. 34.22)
(a)
(1)
It is the policy of the city to diversify its investment portfolios.
(2)
Assets held in the pooled cash fund and other investment funds shall
be diversified to eliminate the risk of loss resulting from over-concentration
of assets in a specific maturity, a specific issuer or a specific
class of securities.
(b)
In
establishing specific diversification strategies, the following general
policies and constraints shall apply:
(2)
To attain sufficient liquidity, the city shall schedule the maturity
of its investments to coincide with known disbursements.
(3)
Risks of market price volatility shall be controlled through maturity
diversification such that aggregate price losses on instruments with
maturities approaching one year shall not be greater than coupon interest
and investment income received from the balance of the portfolio.
(2004 Code, sec. 34.23)
A qualified bank depository shall be selected through the city’s
banking services procurement process, which shall include a formal
request for proposals issued every two years. In selecting a depository,
the city shall give consideration to various criteria as presented
in the request for proposal.
(2004 Code, sec. 34.24)
The investment officer shall prepare, on a quarterly basis,
an investment report which reflects all investment securities, maturities,
fund types, earnings for the quarter, year to date and financial institutions
from which securities were purchased.
(2004 Code, sec. 34.25)
