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09-22-14 Council Packet
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09-22-14 Council Packet
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City Council
Council Document Type
Council Packet
Meeting Date
09/22/2014
Council Meeting Type
Regular
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2. Liquidity The investment portfolio shall remain sufficiently liquid to meet all <br />operating requirements that may be reasonable anticipated. This is accomplished by structuring <br />the portfolio so that securities mature concurrent with cash needs to meet anticipated demands. <br />Furthermore, since all possible cash demands cannot be anticipated, the portfolio should consist <br />largely of securities with active secondary or resale markets. <br />3. Yield The investment portfolio shall be designed with the objective of attaining a <br />market rate of return throughout budgetary and economic cycles, taking into account the <br />investment risk constraints and liquidity needs. Return on investment is of secondary importance <br />compared to the safety and liquidity objectives described above. The core of investments are <br />limited to relatively low risk securities in anticipation of earning a fair return relative to the risk <br />being assumed. Securities shall not be sold prior to maturity with the following exceptions: <br />* A security with declining credit may be sold early to minimize loss of principal. <br />* A security swap would improve the quality, yield, or target duration in the portfolio. <br />* Liquidity needs of the portfolio require that the security be sold. <br />III. Standards of Care <br />1. Prudence The standard of prudence to be used by investment officials shall be the <br />"prudent person" standard and shall be applied in the context of managing an overall portfolio. <br />Investment officers acting in accordance with written procedures and this investment policy and <br />exercising due diligence shall be relieved of personal responsibility for an individual security's <br />credit risk or market price changes, provided deviations from expectations are reported in a <br />timely fashion and the liquidity and the sale of securities are carried out in accordance with the <br />terms of this policy. <br />Investments shall be made with judgment and care, under circumstances then prevailing, which <br />persons of prudence, discretion and intelligence exercise in the management of their own affairs, <br />not for speculation, but for investment, considering the probable safety of their capital as well as <br />the probable income to be derived. <br />2. Delegation of Authority Authority to manage the investment program is granted to <br />the investment officer and appointed employee in cases of his/her unavailability. Responsibility <br />for the operation of the investment program is hereby delegated to the investment officer, who <br />shall act in accordance with established written procedures and internal controls for the operation <br />of the investment program consistent with this investment policy. Procedures should include <br />references to: safekeeping, delivery vs. payment, investment accounting, repurchase agreements, <br />wire transfer agreements, and collateral/depository agreements. No person may engage in an <br />investment transaction except as provided under the terms of this policy and the procedures <br />established by the investment officer. The investment officer shall be responsible for all <br />transactions undertaken and shall establish a system of controls to regulate the activities of <br />subordinate officials. <br />2 <br />
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