 |
 |
|||
 |
 |
 |
 |
|
Article 45 - Investment Of District Funds
| Section 45.1 | Scope |
| Section 45.2 | Objectives |
| Section 45.3 | Definitions |
| Section 45.4 | Delegation of Authority |
| Section 45.5 | Prudence |
| Section 45.6 | Diversification |
| Section 45.7 | Internal Controls |
| Section 45.8 | Designation of Depositories |
| Section 45.9 | Collateralizing of Deposits |
| Section 45.10 | Safekeeping and Collateralization |
| Section 45.11 | Permitted Investments |
| Section 45.12 | Authorized Financial Institutions and Dealers |
| Section 45.13 | Purchase of Investments |
| Section 45.14 | Repurchase Agreements |
Article 45
INVESTMENT OF DISTRICT FUNDS
Adopted 7/02/02
This investment policy applies to all moneys and other financial resources available for investment on behalf of Saranac Lake Central School District or on behalf of any other entity or individual.
The primary objectives of the Saranac Lake Central School District's investment activities are, in priority order:
(A) to conform with all applicable federal, state and other legal requirements (legal);
(B) to adequately safeguard principal (safety);
(C) to provide sufficient liquidity to meet all operating requirements (liquidity); and
(D) to obtain a reasonable rate of return (yield).
For the purposes of this policy, the following terms shall have the definitions and meanings ascribed to them in General Municipal Law '10:
(A) Bank
(B) Eligible Letter of Credit
(C) Eligible Securities
(D) Eligible Surety Bond
(E) Local Government
(F) Public Deposits
(G) Public Funds
(H) Trust Company
Section 45.4 Delegation of Authority
The responsibility for administration of the investment program is delegated to the Saranac Lake Central School District Treasurer, who shall establish written procedures for the operation of the investment program consistent with the provisions of this resolution. Such procedures shall include an adequate internal control structure to provide a satisfactory level of accountability based on a data base or records incorporating description and amounts of investments, transaction dates, and other relevant information, and shall regulate the activities of subordinate employees.
(A) All participants in the investment process shall seek to act responsibly as custodians of the public trust and shall avoid any transaction that might impair public confidence in Saranac Lake Central School District to govern effectively.
(B) Investments shall be made with judgment and care, under circumstances then prevailing, which persons of prudence, discretion and intelligence exercise in the management of their own affairs, not for speculation, but for investment, considering the safety of the principal as well as the probable income to be derived.
(C) All participants involved in the investment process shall refrain from personal business activity that could conflict with proper execution of the investment program, or which could impair their ability to make impartial investment decisions.
It is the policy of Saranac Lake Central School District to diversify its deposits and investments by financial institution, by investment instrument, and by maturity scheduling.
Section 45.7 Internal Controls
(A) All funds received by any officer or employee of Saranac Lake Central School District shall be handled and managed in compliance with the District's cash management policy.
(B) The Saranac Lake Central School District Treasurer is responsible for establishing and maintaining an internal control structure to provide reasonable, but not absolute, assurance that deposits and investments are safeguarded against loss from unauthorized use or disposition, that transactions are executed in accordance with management's authorization and recorded properly, and are managed in compliance with applicable laws and regulations.
Section 45.8 Designation of Depositories
The banks and trust companies authorized for the deposit of monies up to the maximum amounts set forth below are:
Name of Depository Maximum Deposit Amount
1. NBT Bank, NA $ 12,500,000.00
Lake Flower Avenue
Saranac Lake, NY 12983
2. Charter One Bank $ 12,500,000.00
Broadway
Saranac Lake, NY
3. Adirondack Bank $ 12,500,000.00
Main Street
Saranac Lake, NY
4. Tupper Lake National Bank $ 12,500,000.00
195 Lake Flower Avenue
Saranac Lake, NY 12983
5. MBIA $ 12,500,000.00
Section 45.9 Collateralizing of Deposits
In accordance with the provisions of General Municipal Law '10, all deposits of Saranac Lake Central School District, including certificates of deposit and special time deposits, in excess of the amount insured under the provisions of the Federal Deposit Insurance Act shall be secured by a pledge B with an aggregate "market value" as provided by General Municipal Law '10 equal to 105% of the aggregate amount of deposits B of
(A) eligible securities,
(B) eligible surety bonds, and/or
(C) eligible letters of credit.
Section 45.10 Safekeeping and Collateralization
(A) Eligible securities used for collateralizing deposits shall be held by the depositary and/or a third party bank or trust company subject to security and custodial agreements.
(B) The security agreement shall provide that eligible securities are being pledged to secure local government deposits together with agreed upon interest, if any, and any costs or expenses arising out of the collection of such deposits upon default. It shall also provide the conditions under which the securities may be sold, presented for payment, substituted or released and the events which will enable Saranac Lake Central School District to exercise its rights against the pledged securities. In the event that the securities are not registered or inscribed in the name of Saranac Lake Central School District, such securities shall be delivered in a form suitable for transfer or with an assignment in blank to Saranac Lake Central School District or its custodial bank.
(C) The custodial agreement shall provide that securities held by the bank or trust company, or agent of and custodian for, Saranac Lake Central School District, will be kept separate and apart from the general assets of the custodial bank or trust company and will not, in any circumstances, be commingled with or become part of the backing for any other deposit or other liabilities. The agreement should also describe that the custodian shall confirm the receipt, substitution or release of the securities. The agreement shall provide for the frequency of revaluation of eligible securities and for the substitution of securities when a change in the rating of a security may cause ineligibility. Such agreement shall include all provisions necessary to provide Saranac Lake Central School District a perfected interest in the securities.
Section 45.11 Permitted Investments
(A) As authorized by General Municipal Law '11, the Saranac Lake Central School District Board of Education authorizes the District Treasurer to invest monies not required for immediate expenditure for terms not to exceed its projected cash flow needs in the following types of investments:
(1) special time deposit accounts;
(2) certificates of deposit;
(3) obligations of the United States of America;
(4) obligations guaranteed by agencies of the United States of America where the payment of principal and interest are guaranteed by the United States of America;
(5) obligations of the State of New York;
(6) obligations issued pursuant to Local Finance Law '24.00 or 25.00 (with the approval of the State Comptroller) by any municipality, school District or District corporation other than Saranac Lake Central School District;
(7) obligations of public authorities, public housing authorities, urban renewal agencies and industrial development agencies where the general state statutes governing such entities or whose specific enabling legislation authorizes such investments;
(8) certificates of participation (COPs) issued pursuant to General Municipal Law '109-b;
(9) obligations of Saranac Lake Central School District, but only with any monies in a reserve fund established pursuant to General Municipal Law '6-c, 6-d, 6-e, 6-g, 6-h, 6-j, 6-k, 6-l, 6-m, or 6-n.
(B) All investment obligations shall be payable or redeemable at the option of Saranac Lake Central School District within such times as the proceeds will be needed to meet expenditures or purposes for which the monies were provided and, in the case of obligations purchased with the proceeds of bonds or notes, shall be payable or redeemable at the option of Saranac Lake Central School District within two (2) years of the date of purchase.
Section 45.12 Authorized Financial Institutions and Dealers
The Saranac Lake Central School District shall maintain a list of financial institutions and dealers approved for investment purposes and shall establish appropriate limits to the amount of investments which can be made with each financial institution or dealer. All financial institutions with which the District conducts business must be credit worthy. Banks shall provide their most recent Consolidated Report of Condition (Call Report) at the request of the President of the Board of Education, the Superintendent or the District Treasurer. Security dealers not affiliated with a bank shall be required to be classified as reporting dealers affiliated with the New York Federal Reserve Bank, as primary dealers. The Saranac Lake Central School District Treasurer is responsible for evaluating the financial position and maintaining a listing of proposed depositories, trading partners and custodians. Such listing shall be evaluated at least annually.
Section 45.13 Purchase of Investments
(A) The Saranac Lake Central School District Treasurer is authorized to contract for the purchase of investments:
(1) Directly, including through a repurchase agreement, from an authorized trading partner.
(2) By participation in a cooperative investment program with another authorized governmental entity pursuant to Article 5G of the General Municipal Law where such program meets all the requirements set forth in the Office of the State Comptroller Opinion No. 88-46, and the specific program has been authorized by the Saranac Lake Central School District Board of Education.
(3) By utilizing an ongoing investment program with an authorized trading partner pursuant to a contract authorized by the Saranac Lake Central School District Board of Education.
(B) All purchased obligations, unless registered or inscribed in the name of Saranac Lake Central School District, shall be purchased through, delivered to and held in the custody of a bank or trust company. Such obligations shall be purchased, sold or presented for redemption or payment by such bank or trust company only in accordance with prior written authorization from the officer authorized to make the investment. All such transactions shall be confirmed in writing to Saranac Lake Central School District by the bank or trust company. Any obligation held in the custody of a bank or trust company shall be held pursuant to a written custodial agreement as described in General Municipal Law '10.
(C) The custodial agreement shall provide that securities held by a bank or trust company, as agent of and custodian for, Saranac Lake Central School District, will be kept separate and apart from the general assets of the custodial bank or trust company and will not, in any circumstances, be commingled with or become part of the backing for any other deposit or other liabilities. The agreement shall describe how the custodian shall confirm the receipt and release of the securities. Such agreement shall include all provisions necessary to provide Saranac Lake Central School District a perfected interest in the securities.
Section 45.14 Repurchase Agreements
(A) Repurchase agreements are authorized subject to the following restrictions:
(1) All repurchase agreements must be entered into subject to a Master Repurchase Agreement;
(2) Trading partners are limited to banks or trust companies authorized to do business in New York State and primary reporting dealers;
(3) Obligations shall be limited to obligations of the United States of America and obligations guaranteed by agencies of the United States of America;
(4) No substitution of securities will be allowed;
(5) The custodian shall be a party other than the trading partner.