Town of Forestburgh, NY
Sullivan County
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[HISTORY: Adopted by the Town Board of the Town of Forestburgh 1-7-1992. Amendments noted where applicable.]
The objectives of this investment policy of the Town of Forestburgh are to provide reasonable assurance that the assets of the Town are safeguarded, investments made by the Town will mature when cash is required to finance operations, and a competitive rate of return will be realized on the Town's investments.
In pursuance of the foregoing objectives, the Supervisor is hereby authorized to invest all funds, including the proceeds of obligations and reserve funds, in:
Certificates of deposit issued by a bank or trust company authorized to do business in the State of New York.
Obligations of the United States of America.
Repurchase agreements involving the purchase and sale of direct obligations of the United States of America.
All other Town officials receiving money in their official capacity shall, if required by resolution of the Town Board, deposit such funds in Negotiable Order of Withdrawal (NOW) accounts.
All investments made pursuant to this policy shall comply with the following conditions:
Collateral. Certificates of deposit and other bank accounts shall be fully secured by insurance of the Federal Deposit Insurance Corporation (FDIC) or by obligations of New York State or the United States or obligations of federal agencies, the principal and interest of which are guaranteed by the United States, or obligations of local governments of the State of New York. Collateral shall be delivered to the Town or to the custodial bank with which the Town has entered into a custodial agreement. The market value of the collateral shall at all times equal or exceed the principal amount of the certificates of deposit and other bank accounts. Collateral shall be monitored monthly.
Delivery of securities. Every repurchase agreement shall provide for payment to the seller only upon the seller's delivery of the authorized obligation to the designated custodial bank. The seller shall not be entitled to substitute securities, which requirement shall be so stated in the repurchase agreement. Repurchase agreements shall be for periods of not less than 10 days and not more than 45 days. The custodial bank shall confirm all transactions in writing to insure that the Town's ownership of the securities is properly reflected on the records of the custodial bank.
Written contracts. All repurchase agreements and custodial undertakings must be in writing.
Designation of custodial banks. Custodial banks shall be designated by the official depositories of the Town. Each banking institution shall have on file with the Town a three-party custodial agreement specifying the obligations of the custodial bank. However, securities may not be purchased through a repurchase agreement with a custodial bank.
Financial strength of institutions. All trading partners must be creditworthy. They must be a member of the Federal Deposit Insurance Corporation. The Supervisor will request a copy of the annual audited financial report used to establish each institution's creditworthiness, or the Supervisor may rely upon information made available by recognized credit rating agencies.
The Supervisor shall authorize the purchase and sale of all securities, executed contracts for repurchase agreements and certificates of deposit on behalf of the Town, unless a contrary requirement is imposed by resolution of the Town Board.
The purchase and sale of securities and certificates of deposit shall be accomplished through a competitive process involving telephone solicitation of at least two bids for each transaction.
The provisions of this policy and any amendments hereto shall take effect prospectively, and shall not invalidate the prior selection of any custodial bank or prior investments of the Town.
In the event the Supervisor receives recommendations through private or state audits regarding the Town's investment policy, such recommendations shall be discussed and considered by the Town Board.
The Town Board shall at least annually, at its reorganization meeting, review and if necessary, amend the investment policy.
The foregoing investment policy was established by the Town of Forestburgh pursuant to a resolution duly adopted on January 7, 1992.