HomeMy WebLinkAboutResolution 95-014RESOLUTION NO.95-14
ADOPTING THE DISTRICTS’INVESTMENT POLICY
A JOINT RESOLUTION OF THE BOARDS OF DIRECTORS
OF COUNTY SANITATION DISTRICTS NOS.1,2,3,5,6,
7,11,13 AND 14 OF ORANGE COUNTY,CALIFORNIA
ADOPTING THE DISTRICTS’INVESTMENT POLICY
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WHEREAS,the Districts have previously used the Office of the Orange County
Treasurer as the depository of all Districts’funds and investor of the Districts’surplus
funds;and,
WHEREAS,the Boards of Directors adopted Resolution No.94-156 on
December 8,1994,designating a Districts’Treasurer and authorizing the Districts’
Treasurer to invest or reinvest Districts’funds;and,
WHEREAS,to properly carry out the duties of the office,the Districts’Treasurer
should follow an established policy of investments for their surplus funds.
NOW,THEREFORE,the Boards of Directors of County Sanitation Districts Nos.
1,2,3,5,6,7,11,13 and 14 of Orange County,California,
DO HEREBY RESOLVE,DETERMINE AND ORDER:
Section 1 The Boards of Directors hereby adopt the Investment Policy of the
County Sanitation Districts of Orange County,California,as set forth on Exhibit “A”,
attached hereto and incorporated herein by reference.
PASSED AND ADOPTED at a regular meeting held February 8,1995.
FPC 95-04
County Sanitation Districts of Orange County
Investment Policy
Pumose
The Districts’ultimate investment goal is to enhance the economic condition of the
Districts while providing for the safety of funds invested and assuring that money is
always available when needed.
2.Objectives
The Districts strive 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 designed to accurately monitor and forecast expenditures and revenues.The
Districts attempt to obtain the highest yield on its’investments consistent with the
preservation of principal and liquidity.
3.Delegation and Authority
The Districts have the authority to invest in the spectrum of instruments allowable
under the Government Code Section 53600 et.seq.of the State of California.The
Districts’Board of Directors has delegated,by resolution,the authority to invest to
the Districts’Treasurer,subject to the limitation set forth in this investment policy.
4.Investment Instruments
The Districts’Treasurer is currently limited to the following investment instruments
as approved by the California Government Code:
•U.S.Treasury Bills or Notes
•State of California Local Agency Investment Fund
•Obligations of Federal Agencies
5.Policy Criteria For Selecting Investments (In Order of Priority
A.Safety
Safety and the minimizing of risk associated with investing refers to attempts
to reduce the potential 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 local governments.The second
level of risk control is reduction of default risk in 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 Districts only invest in those instruments that
are considered very safe.
B.Liquidity
Liquidity refers to the ability to easily sell at any time with minimal risk of
losing some portion of principal or interest.Liquidity is an important quality
for an investment to have,for at any time the Districts may have unexpected
or unusual circumstances that result in larger disbursements then expected,
and some investments may need to be sold to meet the contingency.Most
investments of the Districts are highly liquid,with the exception of 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 Districts attempt to obtain the
highest yield possible when selecting an investment,provided that the criteria
stated in this Investment Policy are met.
6.Policy Constraints
The Districts operate an investment program with many State and self-imposed
constraints.It does not speculate;it does not buy stocks or corporate bonds;it does
not deal in futures or options;it does not purchase on margin through Reverse
Repurchase Agreements.Investment maturities are currently restricted to less than
one year.The Districts diversifies its investments to reduce potential default on
market risks.The portfolio is carefully monitored to assure the prudent management
of the portfolio.All purchases are made only after three bids or bid comparisons are
obtained.
7.SafekeeDing
Securities purchased from brokers/dealers shall be held in third party safekeeping
by the trust department of the Districts’bank or other designated third party trust,in
the Districts’name and control.
8.Investment Reports
A.The Treasurer annually renders a Statement of Investment Policy to the
Districts’Board of Directors for their approval.
B.The Treasurer renders a monthly investment report to the Districts’Finance
and Personnel Committee showing the type of investment,institution,date
of maturity,amount of deposit,rate of interest,market value and such other
data as may be required by the Districts.
C.The monthly investment report states its relationship to the Statement of
Investment Policy by indicating each and every instance that there is a
divergence from or violation of policy or stating that the monthly report is in
compliance with the approved Statement of Investment Policy.
STATE OF CALIFORNIA)
)SS.
COUNTY OF ORANGE )
I,PENNY KYLE,Secretary of the Boards of Directors of County Sanitation
Districts Nos.1,2,3,5,6,7,11,13 and 14 of Orange County,California,do hereby
certify that the foregoing Resolution No.95-14 was passed and adopted at a regular
meeting of said Boards on the 8th day of February,1995,by the following vote,to wit:
AYES:Cecilia Age,John Collins,John C.Cox,Jr.,Jan Debay,Barry
Denes,Shirly Dettloff,Burnie Dunlap,Norman Z.Eckenrode,
James M.Ferryman,James H.Flora,Don R.Griffin,John
Gullixson,Barry Hammond,Victor Leipzig,Wally Linn,Pat
McGuigan,Mark A.Murphy,Margie L.Rice,Julie Sa,Thomas R.
Saltarelli,Sal A.Sapien,Sheldon S.Singer,Roger R.Stanton,
William G.Steiner,Peer A.Swan,Charles E.Sylvia,Daniel T.
Welch
NOES:None
ABSENT:George Brown,Bob Zemel
IN WITNESS WHEREOF,I have hereunto set my hand and affixed the official
seal of County Sanitation District No.1 on behalf of itself and Districts Nos.2,3,5,6,7,
11,13 and 14 of Orange County,California,this 8th day of February,1995.
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Boards of Dir ctor ounty Sanitation
Districts Nos.1,2,3,5,6,7,11,13 ahd 14
of Orange County,California
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