§ 2-239. Investment of public funds.

(a)

When a sufficient amount of money has accumulated in the accounts or funds of the city or when the city has accumulated monies by reason of the sale of its own securities, which, in either case, in the judgment of the finance director warrant, consistent with guidelines approved by the city council, purchase of investment securities, the finance director may then purchase investment securities at prevailing market rates on behalf of and in the name of the city, in an appropriate amount thereof as set forth in the city's investment policies.

(b)

The finance director, consistent with policies approved by the city council, is authorized to sell such obligations or securities purchased pursuant to this section at the prevailing market price and to pay the proceeds of such sale into the proper accounts or funds of the city.

(c)

The finance director shall develop and present to the city council for approval investment policies addressing, at a minimum, the issues of investment objectives, maturity, risk and diversification, and instruments used. The finance director will also establish appropriate internal control and investment procedures addressing, at a minimum, master clearing account(s), separation of functions, delegation of authority, performance evaluation, and operations review and reporting, both interim and annual. Such procedures shall be reviewed periodically by the city manager.

(d)

All securities purchased by the city under this section shall be properly designated as an asset of the city and held in safekeeping by a third-party custodial bank or other third-party custodial institution, chartered by the United States government or the state, and no withdrawal of such securities, in whole or in part, shall be made from safekeeping except by the finance director as authorized herein.

(e)

All securities purchased or sold will be transferred only under the "delivery versus payment" (DVP) method (or "payment versus delivery" method) to ensure that funds or securities are not released until all criteria relating to the specific transaction are met. Only after advising the city manager in writing and receiving written permission from the city manager shall the finance director be authorized to deliver securities free of payment.

(f)

The finance director is authorized to accept, on behalf of and in the name of the city, bank safekeeping receipts or confirmations from a third-party custodian, which might be the trust department of the bank, in return for investment of temporarily idle funds as evidence of actual delivery of the obligations or securities. Safekeeping of nonnegotiable certificates of deposit will be handled through detailed written procedures. Any such safekeeping receipt or confirmation shall fully describe the various obligations or securities held. The actual obligations or securities, whether in book-entry or physical form, on which safekeeping receipts or confirmations are issued may be held by any bank depository chartered by the United States government or the state.

(g)

The finance director shall develop and maintain lists of authorized institutions, issuers and dealers through whom investments can be carried out. All securities purchased shall be only those securities of authorized issuers of the various security types. Securities shall be purchased only from financial institutions which provide the services of a securities dealer through primary securities dealers as designated by the Federal Reserve Bank, and through secondary government securities dealers. Certificates of deposit shall be purchased only from financial institutions which qualify under state law.

(Ord. No. 1993-55, § 1, 11-16-93)