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HomeMy WebLinkAboutCC RES 91-038 � � " � t 1 RESOLUTION NO. 91�$ A RESOLUTION OF THE CITY COUNCII. OF TI� CITY OF PALM DESERT, CALIFOItNIA, ADOPTING A POLICY FOR THE OF CITY OF PALM DESERT FUNDS. V�VIHEREAS, Secdon 53646 of the State of California Government Code has been � amended to require the annual review and adoption of an investment policy statement; and 1 V�V]HERF.�►S, said investment policy has been wntten in compliance with all applicable laws and in accordance with guidelines provided by the California Municipal Treasurers Association; and WHEREAS, the City of Palm Desert Finance Committee, composed of the Mayor, City Manager and Finance Director, has reviewed the proposed policy; NOW, THIItEFORE, BE TT RESOLVID by the City Council of the City of Palm Desert, California, as follows: 1. That the policy statement attached hereto as exhibit "A"is adopted; and 2. That the policy will be examined and considered for readoption each January. PASSID, APPROVID, and ADOPTID at a regular meedng of the Palm Desert City Council held on this 28th day of March , 1991, by the following vote, to wit: AYES: Bea�on, Kelly, Snyde�r NOES: N�e ABSENT: Crites, Wilson ABSTAIN: None WALTIIt H.SNYDIIt, YOR T: � � � ` ', SHIII.A R. G GAN . CITY CI.ERK RESOLUTION NO.gI_3g EXHIBIT "A" PAGE 2 C1TY OF PALM DESERT POLICY 1. PURPOSE Tfiis Statement is intended to provide direction for the investment of the City's temporary idle cash. The City's ultimate investment goal is to enhance the economic condition of the City while insuring the safety of funds invested and assuring that money is always available when needed. 2. O The City strives to maintain the level of investment of all idle funds as near 100% as possible, through the optimum operation of its cash management system which is designated to accurately monitor and forecast expenditures and revenue. The City attempts to obtain the highest yield on its' investments consistent with preservation of principal and liquidity. 3. DEI.EGATION OF AUTHORITY '�'� The City invests in the spectrum of instruments allowable under the Government Code Section 53600 et seq. of the State of California. The City Council delegated the authority to invest to the City Treasurer, or his delegate, in Chapter 3.08 section .010 of the Palm Desert Municipal Code. 4. INS'I'RUMII�'I'S The City invests in the following investment instruments as approved by the California Government Code: - Securities of the U.S. Government or its' Agencies - Local Agency Investment Fund (L.A.I.F.) - Certificates of Deposit (Time Deposits, C.D.'s) - Other investments that are, or may become, legal investments through the State of California Government Code and with prior approval of the City Council. 1 � .i 1 . . RFSOLU'TION N0. 91-38 EXHIBTT - PAGE 3 5. POLICY C:RTI'ERIA FOR SELF.CTING ,_ �N ORDER OF PRIORTI'Y A) SAFETY Safety and the minimizing of risk associated with investing refers to attempts to reduce the potendal for loss of principal, interest or a combination of the two. The first level of risk control is found in state law which restricts the particular type of investments permissible for municipalities. The second level of risk by investing in instruments that appear upon examination to be the most credit worthy. The third level of risk control is reduction of market risk by investing in instruments that have maturities coinciding with dates of disbursement, thereby eliminating risk of loss from a forced sale. The city only invests in those instruments that are considered very safe. B) LIQUIDITY The City utilizes Local Agency Investment Fund for such purposes whereby the City may liquidate all or any portion of the funds invested within 24 hours with no penalty. The City invests in Time Certificates of Deposits issued by banks and savings and loan companies, whose maturities are selected in anticipation of disbursement needs, thereby obviating the need for forced liquidation or lost interest penalties. C) YIELD Yield is the potential dollar earnings an investment can provide, and also is sometimes described as the rate of return. The City attempts to obtain the highest yield possible when selecting an investment. D) MATURITY As a required by Government Code Section 53601, the City may not invest in instruments having a maturity in excess of five years unless the City Council authorizes such an investment either specifically or as part of an investment program approved by the Council no less than three months prior to the time of investment. 6. SII.ECI'ION OF CONTACI'S The City maintains a "Bid List"which contains various banks, savings and loans and brokers. When the City has funds available, letters are sent requesting bids from institutions on the List, each bidding institution is reviewed by the Treasurer for their relative strength and safety features. RESOLUTION N0. 91-38 EXHIBTT "A"- PAGE 4 7. INVESTMII�'T CONTROIS The City Treasurer oversees all the City's investments. 8. INVESTMEN'T REPORTS A) The Treasurer annually renders a Statement of Investment Policy to the City Council for their approval. B) The Treasurer renders a monthly investment report to the City Manger and City Council showing the type of investment, institution, date of maturity, amount of deposit and interest earnable. 9. INVESTMENT AUDTI'S Annually, there is an external audit of the City's investment activity to assure compliance with all applicable laws and policies. 10. ANCE CObIIH1TTEE The City utilizes a Finance Committee, composed of the Mayor, City Manager, Assistant City Manager/RDA Director and Finance Director, to insure stability and constant information flow as it relates to investment and other finance activities.