This investment policy applies to all moneys
and other financial resources available for investment 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.ย To conform with all applicable federal, state and
other legal requirements (legal);
B.ย To adequately safeguard principal (safety);
C.ย To provide sufficient liquidity to meet all operating
requirements (liquidity); and
D.ย To obtain a reasonable rate of return (yield).
The governing board's responsibility for administration
of the investment program is delegated to the Treasurer, who shall
establish written procedures for the operation of the investment program
consistent with these investment guidelines. Such procedures shall
include an adequate internal control structure to provide a satisfactory
level of accountability based on a data base or records incorporating
description and amounts of investments, transaction dates and other
relevant information and regulate the activities of subordinate employees.
It is the policy of the Village of Pelham Manor
to diversify its deposits and investments by financial institution,
by investment instrument, and by maturity scheduling.
The banks and trust companies authorized for
the deposit of moneys up to the maximum amounts are to be designated
by resolution at the Annual Meeting of the Board of Trustees or at
any other meeting of the Board at its convenience.
In accordance with the provisions of General
Municipal Law ยงย 10, all deposits of the Village of Pelham
Manor, 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:
A.ย By a pledge of eligible securities with an aggregate
market value as provided by General Municipal Law ยงย 10,
equal to the aggregate amount of deposits from the categories designated
in Appendix A to the policy.
B.ย By an eligible irrevocable letter of credit issued
by a qualified bank other than the bank with the deposits in favor
of the government for a term not to exceed 90 days with an aggregate
value equal to 140% of the aggregate amount of deposits and the agreed
upon interest, if any. A qualified bank is one whose commercial paper
and other unsecured short-term debt obligations are rated in one of
the three highest rating categories by at least one nationally recognized
statistical rating organization or by a bank that is in compliance
with applicable federal minimum risk-based capital requirements.
C.ย By an eligible surety bond payable to the government
for an amount at least equal to 100% of the aggregate amount of deposits
and the agreed upon interest, if any, executed by an insurance company
authorized to do business in New York State, whose claims-paying ability
is rated in the highest rating category by at least two nationally
recognized statistical rating organizations.
Eligible securities used for collateralizing
shall be held by Chemical Bank and the Bank of New York subject to
security and custodial agreements.
A.ย The security agreement shall provide that eligible
securities are being pledged to secure local government deposits together
with 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 and the events which will enable
the local government to exercise its rights against the pledged securities.
In the event that the securities are not registered or inscribed in
the name of the local government, such securities shall be delivered
in a form suitable for transfer or with an assignment in blank to
the Village of Pelham Manor or its custodial bank.
B.ย The custodial agreement shall provide that securities
held by the bank or trust company, or 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 should also
describe that the custodian shall confirm the receipt, substitution
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 local government a perfected interest in the securities.
The Village of Pelham Manor 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 local government conducts business must
be creditworthy. Banks shall provide their most recent Consolidated
Report of Condition (Call Report) at the request of the Village of
Pelham Manor. Security dealers not affiliated with a bank shall be
required to be classified as reporting dealers affiliated with the
New York Federal Reserve Bank as primary dealers. The Treasurer is
responsible for evaluating the financial position and maintaining
a listing of proposed depositories, trading partners and custodians.
Such listing shall be evaluated at least annually.
Repurchase agreements are authorized subject
to the following restrictions:
A.ย All repurchase agreements must be entered into subject
to a Master Repurchase Agreement.
B.ย Trading partners are limited to banks or trust companies
authorized to do business in New York State and primary reporting
dealers.
C.ย Obligations shall be limited to obligations of the
United States of America and obligations guaranteed by agencies of
the United States of America.
D.ย No substitution of securities will be allowed.
E.ย The custodian shall be a party other than the trading
partner.