The objectives of the investment policy of the Village of Akron 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.
All investments made pursuant to this investment policy shall comply
with the following conditions:
A. Collateral.
(1) Certificates 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 New York State local governments, or a combination of same.
Collateral shall be delivered to the Village of Akron or a custodial bank
with which the Village of Akron 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 be monitored no less
frequently than monthly, and market value shall mean the bid or closing price
as quoted in the Wall Street Journal or as quoted by another recognized pricing
service.
(2) Securities purchased through a repurchase agreement shall
be valued to market at least weekly.
(3) 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. Delivery of securities.
(1) Repurchase agreements. Every repurchase agreement shall
provide for payment to the seller only upon the seller's delivery of obligations
of the United States to the custodial bank designated by the Village of Akron
or, in the case of a book-entry transaction, when the obligations of the United
States are credited to the custodian's Federal Reserve Bank account. The seller
shall not be entitled to substitute securities. Repurchase agreements shall
be for periods of 30 days or less. The custodial bank shall confirm all transactions
in writing to ensure that the Village of Akron's ownership of the securities
is properly reflected on the records of the custodial bank.
(2) Payment shall be made by or on behalf of the Village
of Akron for obligations of New York State, obligations the principal and
interest of which are guaranteed by the United States, United States obligations,
certificates of deposit and other purchased securities upon the delivery thereof
to the custodial bank or, in the case of a book-entry transaction, when the
purchased securities are credited to the custodial bank's Federal Reserve
System account. All transactions shall be confirmed in writing.
(3) Written contracts. Written contracts are required for
repurchase agreements, certificates of deposit and custodial undertakings.
With respect to the purchase of obligations of the United States, New York
State or other governmental entities, etc., in which moneys may be invested,
the interests of the Village of Akron will be adequately protected by conditioning
payment on the physical delivery of purchased securities to the Village of
Akron or custodian or, in 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 Village of Akron. It is,
therefore, the policy of the Village of Akron to require written contracts
as follows:
(a) Written contracts shall be required for all repurchase
agreements. Only creditworthy banks and primary reporting dealers shall be
qualified to enter into a repurchase agreement with the Village of Akron.
The written contract shall provide that only obligations of the United States
may be purchased, and the Village of Akron shall make payment upon delivery
of the securities or appropriate book-entry of the purchased securities. No
specific repurchase agreement has been executed between the Village of Akron
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 30 days.
(b) Written contracts shall be required for the purchase
of all certificates of deposit over $100,000.
(c) A written contract shall be required with the custodial
bank.
The bank or trust company chartered by the State of New York is designated
to act as custodial bank of the Village of Akron's investments. However, securities
may not be purchased through a repurchase agreement with the custodial bank.