Resolution No. 5814
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RESOLUTION NO. 5814
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RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
VERNON APPROVING THE CITY INVESTMENT POLICY.
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WHEREAS, pursuant to Resolution Number 4810, the City
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Treasurer has been delegated investment authority by the City
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Council: and
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WHEREAS, the ci ty has approved the ci ty Investment
8 POlicy, dated February 28, 1989: and
9 WHEREAS, the City's investment portfolio may include,
10 pursuant to the City Investment POlicy, other suitable
II instruments as authorized by law and in compliance with sections
12 53601 and 53635 of the California Government Code: and
l3 WHEREAS, the City desires to set forth in detail the
14 instruments the City may acquire pursuant to the city Investment
l5 Policy for its investment portfolio.
l6 NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF
l7 THE CITY OF VERNON AS FOLLOWS:
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SECTION 1:
The City Council of the City of Vernon
19 hereby adopts the City Investment POlicy, attached hereto as
20 Exhibit A to this Resolution.
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SECTION 2:
The City Council of the ci ty of Vernon
22 hereby delegates to the city Treasurer the authority to
23 implement the City Investment Policy and select the instruments
24 for the city's investment portfolio in accordance with said City
25 Investment POlicy.
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SECTION 3: The City Clerk of the City of Vernon shall
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certify to the passage of this Resolution and thereupon and
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thereafter the same shall be in full force and effect.
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APPROVED AND ADOPTED on this 21st day of August, 1990.
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. EQNIS C. MALB G, Mayo
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ATTEST:
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BRUCE V. MALKENHORST, City Clerk
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STATE OF CALIFORNIA
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COUNTY OF LOS ANGELES
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I, BRUCE V. MALKENHORST, City Clerk of the City of
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Vernon, do hereby certify that the foregoing Resolution, being
7 Resolution No. 5814, was duly adopted by the City Council of the
8 City of Vernon, and was approved by the Mayor of said City at a
9 regular meeting of the City Council held on Tuesday, August 21,
1990.
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BRUCE V. MALKENHORST
City Clerk
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CITY INVESTMENT POLICY
Introduction
Monies not required for.immediate expenditure by the City of
Vernon shall be invested in compliance with governing provisions
of law and this pOlicy. The city will maintain adequate cash
availability and strive for maximum yield on invested idle funds
while insuring that principal invested is protected from loss.
This Investment POlicy shall be in compliance with sections 53601
and 53635 of the Government Code of the State of California,
relating to local agency finances.
I. DELEGATION OF AUTHORITY
Pursuant to Resolution No. 4810 the City Treasurer has
been delegated investment authority by the City
Council.
II. INVESTMENT CRITERIA
The criteria for selecting investments are, in order of
priority:
- Safety of principal
- Liquidity
- Maximization of total return on overall portfolio
In general, the City intends to manage its investments
in such a way to ensure meeting these criteria.
Investments will be made in a range of instruments to
lessen risk by diversifying the City's portfolio.
III. POLICIES AND OBJECTIVES
The basic premise underlying the City's investment
policy is to ensure that money is always available when
needed. It shall also be the policy of the City to
diversify its investment portfolio to ensure the maximum
safety of city assets.
Staff actively manages the city's portfolio in order to
take advantage of changing economic conditions. Through
daily p+ojected cash flow analysis, the City will
attempt to fully invest all idle cash.
IV. ACCEPTABLE INVESTMENT VEHICLES
The City's investment portfolio ~ay include the
following instruments:
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EXHIBIT A
a. Bonds issued by a local agency as defined in
section 53630 of the Government Code.
b. united states Treasury notes, bonds, bills, or
certificates of indebtedness, or those for which the faith and
credit of the United states are pledged for the payment of
principal and interest.
c. Registered state warrants or treasury notes or
bonds of the State of California.
d. Bonds, notes, warrants, or other evidences of
indebtedness of any local agency as defined in section 53630 of
the Government Code within the state of California.
e. Obligations issued by banks for cooperatives,
federal land banks, federal intermediate credit banks, federal
home loan banks, the Federal Home Loan Bank Board, the Tennessee
Valley Authority, or in obligations, participations, or other
instruments of, or issued by, or fully guaranteed as to principal
and interest by, the Federal National Mortgage Association; or in
guaranteed portions of Small Business Administration notes: or in
obligations, participations, or other instruments of, or issued
by, a federal agency or a united states government-sponsored
enterprise.
f. Bills of exchange or time drafts drawn on and
accepted by a commercial bank, otherwise known as bankers
acceptances, which are eligible for purchase by the Federal
Reserve System.
g. Commercial paper of "prime" quality of the highest
ranking or of the highest letter and numerical rating as provided
for by Moody's Investors Service, Inc. or Standard and Poor's
Corporation.
h. Negotiable certificates of deposits issued by a
nationally or state-chartered bank or a state or federal
association (as defined by Section 5102 of the Financial Code) or
by a state-licensed branch of a foreign bank.
i. Investments in repurchase agreements or reverse
repurchase agreements of any securities authorized by Section
53601 of the Government Code.
j. Medium-term notes of a maximum of five years
maturity issued by corporations organized and operating within the
United states or by depository institutions licensed by the united
states or any state and operating within the United states.
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k. Shares of beneficial interest issued by diversified
management companies, as defined in section 23701m of the Revenue
and Taxation Code.
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sections 53601
securities, at
to maturity in
All other permitted instruments as
and 53635 of the Government Code.
the time of investment, may have a
excess of five years.
authorized by
These ,
term remaining
Most of the City's short-term investments will be in
securities which pay principal and interest upon
maturity, while most of its long-term investments will
be in securities which pay interest monthly, quarterly
or on coupons semi-annually.
v. REPORTS OF INVESTMENT ACTIVITIES
The Chief Financial Officer is required to file monthly
statements of investment activity with the city Council
and the City Administrator. The statement must include
the following details of every investment:
- Purchase date
- Description (type of investment)
- Maturity date
- Par value (face value of security)
- Book value(purchase price plus or minus amortization
of premium, discount and purchased interest)
- Original cost (amount paid by city for investment)
- Principal cost (same as book value)
- Market rate (face rate)
- Market value (worth of securities at a particular
date)
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