[HISTORY: Adopted by the Board of Selectmen of the Town of Madison 10-26-1998;
printed as amended 5-14-2001. Subsequent amendments noted
where applicable.]
A.
Maine State statutes authorize treasurers to deposit
or invest municipal funds by direction of the municipal officers.
B.
Pursuant to 30-A M.R.S.A. § 5706,
the Town of Madison shall adopt the following investment objectives in the
management and investment of municipal funds:
(1)
The primary objective of the Town's investment activities
is the preservation of capital and the protection of investment principal.
(2)
In investing public funds, the Town staff will strive
to maximize the return on the portfolio but will avoid assuming unreasonable
investment risk.
(3)
The municipality's investment portfolio will remain sufficiently
liquid to enable the municipality to meet operating requirements that might
be reasonably anticipated.
(4)
The Town will diversify its investments to avoid incurring
unreasonable and avoidable risks regarding specific security types or individual
financial institutions.
A.
The Municipal Treasurer shall invest funds for which there is no immediate need, sell and exchange securities so purchased, and deposit such securities for safekeeping. All investment decisions shall be made considering the investment objectives contained in § 606-1 and exercising judgment and care under the circumstances then prevailing.
B.
The following investment principles shall guide the Treasurer
in the conduct of the municipality's investment program:
(1)
The municipality may purchase only legally authorized
investments under 30-A M.R.S.A. § 5706.
(2)
The maturity date of new investments shall not be further
than the time the municipality anticipates that it will need the funds. To
maintain liquidity, new investments shall have a maturity of one year or less
for municipal operating funds.
(3)
The Town shall not make investments for the purpose of
trading or speculating, such as anticipating an increase of capital through
changes in market interest rates.
(4)
Deposit and investment of funds can only be made in financial
institutions that are insured by the FDIC or the FSLIC. Any funds deposited
or invested above the $100,000 insurance limit must be collateralized by the
financial institution, or the excess funds must be placed with other financial
institutions.
(5)
Cash balances in all demand deposit accounts shall not
exceed compensating balances whenever possible. The Treasurer shall strive
to invest at least 95% of all available funds on a day-to-day basis.
(6)
The Town will invest in financial institutions with significant
Maine operations as much as possible and can only invest in out-of-state financial
institutions where a significant interest rate differential exists.
(7)
Repurchase agreements can only be obtained from known
and financially stable financial institutions. Repurchase agreements must
be collateralized by US Government securities with a market value equal to
or greater than the Town's investments and be perfected under Maine statutes.
A.
The Treasurer shall report monthly to the Town Manager
for the purpose of monitoring the performance and structure of the municipal
investments.
B.
In addition, the Treasurer shall issue an annual investment
report to the Town Selectmen due no later than 60 days after the end of the
fiscal year. The report shall include an evaluation of the performance of
the investment program for the previous year and present an investment plan
for the ensuring year.
All personnel involved in the investment program shall adhere to the
municipality's Code of Ethics[1] to prevent any real or perceived violation of their fiduciary
responsibilities. Such responsibility carries with it the duty to ensure that
all investments are placed without the appearance of any improper influence
or personal gain.
