2022-R-34 - Investment Policy Amendment RESOLUTION NO. 2022-R-34
A RESOLUTION OF THE CITY COUNCIL OF THE CITY
OF EDGEWATER, FLORIDA, UPDATING THE CITY OF
EDGEWATER'S INVESTMENT POLICY; REPEALING
ALL RESOLUTIONS IN CONFLICT HEREWITH AND
PROVIDING FOR AN EFFECTIVE DATE.
WHEREAS, pursuant to the City Charter, the City Manager has the responsibility for
managing an investment program for the City;
WHEREAS,the City Manager requests that City Council update the existing Investment
Policy that the City of Edgewater approved during the Council meeting held on March 3, 2014
pursuant to the adoption of Resolution#2014-R-04.
WHEREAS, in an effort to be consistent with current laws and policies, City Council
wishes for the City of Edgewater to update/modify the existing City of Edgewater Investment
Policy.
NOW, THEREFORE, BE IT RESOLVED by the City Council..of the City of
Edgewater, Florida:
Section 1. The City Council hereby updates/modifies iLhe Cify :of 'Edgew—ater
Investment Policy and all investments as provided for therein shall b6-invested--in accoFd'ance
with said policy,a copy of which is attached and incorporated herein as Exhibit"A'%'
Section 2. All conflicting investment policies are superseded by this policy.
Section 3. All resolutions or parts of resolutions in conflict herewith are hereby
repealed.
(Resolution/#2022-R-34)
Section 4. This resolution shall take effect upon adoption.
After Motion to approve by 0CLtnOLUA Ferry-,n I k e-A with
Second by I L';L e vote on this resolution was as follows:
AYE NAY
Mayor Mike Thomas X
Councilwoman Christine Power
Councilwoman Gigi Bennington
Councilwoman Debbie Dolbow
Councilman Jonah Powers k
PASSED AND DULY ADOPTED this day of, ��l l- ,(,.OA , 2022.
CITY COUNCIL OF THE
CITY OF EDGEWATER,
FLORIDA r''1
G'9 ; ti✓
Mika-Tho
Mayor
ATT-STI >a ( y
• � r
i�G`� .�
Bonnie Zlotnik, MC
City Clerk
For the use and reliance only by the City of Edgewater,
Florida Approved as to form and legality by:
Aaron R.Wolfe,Esquire
City Attorney
Doran,Sims,Wolfe&Yoon
Approved by the City C�tpil of the City of Edgewater at a
meeting held on this H day of Novi_1a-e1 .2022
under Agenda Item No 8—j_
(Resolution/#2022-R-34)
EXH WIT KA"
(Resolution/#2022-R-34)
Investment Policy
City of Edgewater, Florida
I
Cl lv of
ED G .R
EWATE
c. 1951
MaFGh Qr 2 ^November 14, 2022
Resolution No. 20114 R 042022-R-34
n.
City of Edgewater?0442022
/100,*N.
Table of Contents
Page
I. PURPOSE 3
II. SCOPE 3
III. INVESTMENT OBJECTIVES 3
IV. DELEGATION OF AUTHORITY 4
V. STANDARDS OF PRUDENCE 4
Vl. ETHICS AND CONFLICTS OF INTEREST 4
VII. INTERNAL CONTROLS AND INVESTMENT PROCEDURES 4
VIII. CONTINUING EDUCATION 5
IX. AUTHORIZED INVESTMENT INSTITUTIONS AND DEALERS 5
X. MATURITY AND LIQUIDITY REQUIREMENTS 5
XI. COMPETITIVE SELECTION OF INVESTMENT INSTRUMENTS 5
XII. AUTHORIZED INVESTMENTS AND PORTFOLIO COMPOSTION 6
XIII. PERFORMANCE MEASUREMENTS 12
XIV. REPORTING 13
XV. THIRD PARTY CUSTODIAL AGREEMENTS 13
XVI. INVESTMENT COMMITTEE 14
XVII. INTERNAL LOAN PROGRAM 14
XVIII. INVESTMENT POLICY ADOPTION 14
City of Edgewater Page 2 of 13
Investment Policy
of the
City of Edgewater, Florida
I. PURPOSE
The purpose of this Investment Policy (hereinafter"Policy") is to set forth the investment objectives
and parameters for the management of the funds of the City of Edgewater, (hereinafter"City"). This
Policy is designed to ensure the prudent management of public funds, the availability of operating
and capital funds when needed, and an investment return competitive with comparable funds and
financial market indices.
II. SCOPE
In accordance with Section 218.415, Florida Statues, this Policy applies to all cash and investments
held or controlled by the City and shall be identified as"general operating funds"of the City with the
exceptions of the City's Pension Funds and funds related to the issuance of debt where there are
other existing policies or indentures in effect for such funds. Additionally, any future revenues,
which have statutory investment requirements conflicting with this Policy and funds held by state
agencies (e.g., Department of Revenue), are not subject to the provisions of this Policy.
III. INVESTMENT OBJECTIVES
Safety of Principal
The foremost objective of this investment program is the safety of the principal of those funds within
the portfolios. Investment transactions shall seek to keep capital losses at a minimum, whether they i''1
are from securities defaults or erosion of market value. To attain this objective, diversification is
required in order that potential losses on individual securities do not exceed the income generated
from the remainder of the portfolio.
From time to time, securities may be traded for other similar securities to improve yield, maturity or
credit risk. For these transactions, a loss may be incurred for accounting purposes to achieve
optimal investment return, provided any of the following occurs with respect to the replacement
security:
A. The yield has been increased,or
B. The maturity has been reduced or lengthened, or
C. The quality of the investment has been improved.
Maintenance of Liquidity
The portfolios shall be managed in such a manner that funds are available to meet reasonably
anticipated cash flow requirements in an orderly manner. Periodical cash flow analyses will be
completed to ensure that the portfolios are positioned to provide sufficient liquidity.
Return on Investment
Investment portfolios shall be designed with the objective of attaining a market rate of return
throughout budgetary and economic cycles, taking into account the investment risk constraints and
liquidity needs. Return on investment is of least importance compared to the safety and liquidity
objectives described above. The core of investments is limited to relatively low risk securities in
anticipation of earning a fair return relative to the risk being assumed.
City of Edgewater Page 3 of 13
IV. DELEGATION OF AUTHORITY
In accordance with the City's Charter, the responsibility for providing oversight and direction in
regard to the management of the investment program resides with the CityL,, Manager.
Responsibility for the administration of the investment program is hereby delegated by the City
Manager to the Finance Director, who shall maintain an Investment Procedures and Internal
Controls Manual based on this Policy. Specific investment responsibilities may be delegated to
additional staff members by the City Manager or Finance Director. �No person may engage in an
investment transaction except as authorized under the terms of this Policy. ismn 1
The Finance Director shall be responsible for monitoring internal controls, administrative controls
and to regulate the activities of the City's staff involved with the investment program. The City may
employ an Investment MaaageF-Advisor to assist in managing some of the City's portfolios. Such
Investment Advisor Manager- ust be registered with the SEC under the Investment Advisors Act of
1940.
V. STANDARDS OF PRUDENCE
The standard of prudence to be used by investment officials shall be the "Prudent Person" standard
and shall be applied in the context of managing the overall investment program. Investment officers
acting in accordance with written procedures and this investment Policy and exercising due
diligence shall be relieved of personal responsibility for an individual security's credit risk or market
price changes, provided deviations from expectation are reported to the City Council in a timely
fashion and the liquidity and the sale of securities are carried out in accordance with the terms of
this Policy. The"Prudent Person" rule states the following:
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 probable safety of their capital as well as the probable income to
be derived from the investment.
While the standard of prudence to be used by investment officials who are officers or employees is
the "Prudent Person" standard, any person or firm hired or retained to invest, monitor, or advise
concerning these assets shall be held to the higher standard of "Prudent Expert". The standard
shall be that in investing and reinvesting moneys and in acquiring, retaining, managing, and
disposing of investments of these funds, the contractor shall exercise: the judgment, care, skill,
prudence, and diligence under the circumstances then prevailing, which persons of prudence,
discretion, and intelligence, acting in a like capacity and familiar with such matters would use in the
conduct of an enterprise of like character and with like aims by diversifying the investments of the
funds, so as to minimize the risk, considering the probable income as well as the probable safety of
their capital.
VI. ETHICS AND CONFLICTS OF INTEREST
Employees 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
impartial investment decisions. Also, employees involved in the investment shall disclose to the
Investment Committee any material financial interests in financial institutions that conduct business
with the City, and they shall further disclose any material personal financial/investment positions that
could be related to the performance of the City's investment program
VII. INTERNAL CONTROLS AND INVESTMENT PROCEDURES
The Finance Director shall establish a system of internal controls and operational procedures that
are in writing and made a part of the City's operational procedures. The internal controls should be
City of Edgewater Page 4 of 13
designed to prevent losses of funds, which might arise from fraud, employee error, and
misrepresentation by third parties, or imprudent actions by employees. The written procedures
should include reference to safekeeping, repurchase agreements, separation of transaction
authority from accounting and record keeping, wire transfer agreements, banking service contracts,
collateralldepository agreements, and "delivery vs. payment" procedures. NG-pe ge4n
as--i ^+ 2s authwized ^-ger-the—terMs of tb+s—Retic srn{2t. These
procedures are intended to reduce the relatively low risk that material losses may occur and not be
detected within a timely period by employees in the normal course of performing their assigned
functions.
Independent auditors as a normal part of the annual financial audit to the City shall conduct a review
of the system of internal controls to ensure compliance with policies and procedures.
VIII. CONTINUING EDUCATION
The Finance Director management designee and/or appropriate staff shall annually complete 8
hours of continuing education in subjects or courses of study related to investment practices and
products.
IX. AUTHORIZED INVESTMENT INSTITUTIONS AND DEALERS
A+Ahm;i=eCity staff and Investment Advisors shall only purchase securities fi +pm fiRanGial
inst+tu}�s, WhiGhire—Qualified and '^ es}anent Financial Institutions approved by the City or
institutions designated as "Primary Securities Dealers" by the Federal Reserve Bank of New York.
}h, a ;City staff anInvestment Advisers shall only enter into repurchase agreements with
°^^ a! st' ^s;hut—nualified Financial Institutions or aad Primary Securities Dealers as
[sM(31designated by the Federal Reserve Bank of New York. The Finance Director, management
designee and/or the Investment Advisors shall maintain a list of financial institutions and
broker/dealers that are approved for investment purposes and only firms meeting the following will
be eligible requirements to that qualify serve as Qualified Financial Institutions:
1) Regional dealers Gapital FYle 2 updei:that Qualify under Securities and Exchange
Commission Rule 15IC13-1 (uniform net capital rule).
Capital of no less than 510,000,000;
2) Registered as a dealer under the Securities Exchange-Act-of-1 934;
3) Member of the Natiof�at-Assesiatiea-ef Qeaier&s NASD Financial Industry
Regulatory Authority (FINRA)IfSM(41
4) Registered to sell securities in Florida; and
5) The firm and assigned broker have been engaged in the business of effecting
transactions in U.S. government and agency obligations for at least five(5)
consecutive years.
All brokers, dealers and other financial institutions deemed to be Qualified Financial Institutions shall
be provided with current copies of the City's Investment Policy and in turn shall provide written
acknowledgment of receipt.- A current audited financial statement is required to be on file for each
financial institution and broker/dealer with which the City transacts business.
X. MATURITY AND LIQUIDITY REQUIREMENTS
To the extent possible an attempt will be made to match investment maturities with known cash
needs and anticipated cash flow requirements. Investments of current operating funds shall have
maturities of no longer than twenty-four(24) months.
Investments of bond reserves, construction funds, and other non-operating funds("core funds")shall
have a term appropriate to the need for funds and in accordance with debt covenants, but in no ,..h
event shall exceed five(5) years.
City of Edgewater Page 5 of 13
XI. COMPETITIVE SELECTION OF INVESTMENT INSTRUMENTS
After the Finance Director, management designee or the Investment Advisor has determined the
approximate maturity date based on cash flow needs and market conditions and has analyzed and
selected one or more optimal types of investments, a minimum of three (3) Qualified Financial
Institutions and/or Primary Dealers must be contacted and asked to provide bidsloffers on securities
in question fe;�P stmentsvv �90-1nyestrre.nts :arRdeivr,590,999 9Ri7' ORe (1) Quallf{cd
oFoids will be held in confidence until the bid deemed to best meet the investment
objectives is determined and selected. Comoetitive bids are not required for money market mutual
funds, investment pools and balances held with the depository bank.
However, if obtaining bids/offers are not feasible and appropriate, securities may be purchased
utilizing the comparison to current market price method on an exception basis. Acceptable current
market price providers include, but are not limited to:
A. ;Telerate Inf FinatieR_ }t
H-A. Bloomberg Information Systems
B. Wall Street Journal online. Bloomberg online, or a comparable nationally recognized online
service providing updated datiy-market pricingjsMt7]
C. ',U.S. Department of the Treasury website: data section lisyirsi
D. Hy mpGiRg-pr,
The Finance Director or the Investment Advisor shall utilize the competitive bid process to select the
securities to be purchased. Selection by comparison to a current market price, as indicated above,
shall only be utilized when, in judgment of the Finance Director or the Investment Advisor,
competitive bidding would inhibit the selection process.
Examples of when this method may be used include:
A. When time constraints due to unusual circumstances preclude the use of the competitive
bidding process
B. When no active market exists for the issue being traded due to the age or depth of the issue
C. When a security is unique to a single dealer,, fGr example ,,,^«e plaGeMeRt
D. When the transaction involves new issues or issues in the"when issued" market
Overnight sweep investments or repurchase agreements will not be bid,-but may be placed with the
City's depository bank relating to the demand account for which the sweep investments or
repurchase agreement was purchased.
XII. AUTHORIZED INVESTMENTS AND PORTFOLIO COMPOSITION
Investments should be made subject to the City's cash flow needs aro-although such cash flows are
subject to revisions as market conditions and the City's needs change. However, wheA7 In the event
#he-invested funds are needed in whole or in part fer-the-prior to maturity for purposes not-originally
intended or for more optimal investments, the Finance Director or management designee may sell
the investment at the then-prevailing market price and place the proceeds with the City's custodian.
City of Edgewater Page 6 of 13
The following are the investment requirements and allocation limits on security types, issuers, and
maturities as established by the City. The Finance Director or management designee shall have the
option to further restrict investment percentages from time to time based on market conditions, risks
or diversification investment strategies. The percentage allocations requirements for investment
types and issuers are calculated based on the original cost of each investment and the portfolio
value at time of purchase. Investments not listed in this Policy are prohibited. Investments when
purchased must have the required minimum debt rating as required by Moody's and by Standard
Poor's.
The allocation limits and security types do not apply to the investment of debt proceeds. These
investments shall be governed by the debt covenant included in the debt instrument.
A. Florida Prime Investment Pool (Formerly known as The State Board of Administration's
Local Government Surplus Funds Trust Fund) ("SBA Pool")
Portfolio Composition- 100%of available funds may be invested in the SBA.
United States Government Securities, IsN•i(9]or obligations the principal and interest
of which are unconditionally guaranteed by the United States Government. Such
securities will include, but not be limited to the following:
■ Treasury Bills
■ Treasury Notes
I �Feasury GR4&jSM(1OI
■ Treasury Strips
■ Treasury Securities State and Local Government Series SLGS
Portfolio Composition- 100%of available funds may be invested in the United States
Government Securities.
The length to maturity of any direct investment in the United States Government
Securities are five(5) years from the date of purchase. Maturities longer than five
(5)years require the City's approval.
B. United States Government Agencies full faith and credit of the United States
Government
Purchase Authorization-Authorized Staff may invest in bonds, debentures or notes
issued or guaranteed by the United States Government agencies, provided such
obligations are backed by the full faith and credit of the United States Government.
Such securities will include, but not be limited to the following:
• Government National Mortgage Association (GNMA)
• United States Export Import Bank
• Farmer Home Administration
• Federal Financing Bank
• Federal Housing Administration Debentures
• General Services Administration
• New Communities Debentures
• United States Public Housing Notes and Bonds
• United States Department of Housing and Urban Development
A maximum of 50%of available funds may be invested in United States
Government agencies.
City of Edgewater Page 7 of 13
A maximum of 25% of available funds may be invested in individual United States
Government agencies.
The length to maturity for an investment in any United States government agency
security is five (5) years from the date of purchase. Maturities longer than five(5)
years require the City's approval.
C. Federal Instrumentalities(Government Sponsored Agencies or"GSEs")
Bonds, debentures, or notes issued or guaranteed by U.S. Government Sponsored
Agencies limited to the following issuers:
o Federal Farm Credit Bank (FFCB)
o Federal Home Loan Bank or its District banks(FHLB)
o Federal National Mortgage Association (FNMA)
o IFederal Agricultural Mortgage Corporation (Farmer Mac}Isyui 11
o Federal Home Loan Mortgage Corporation (Freddie Macs)
including Federal Home Loan Mortgage Corporation participation
certificates
9vauvern cvizn MwketiRgi-r -MQe)t$M(121
A maximum of 80% of available funds may be invested in Federal
instrumentalities. The combined total of available funds invested in Federal
Agencies, Instrumentalities and Mortgage Backed Securities cannot be more than
80%.
A maximum of 40% of available funds may be invested in any one issuer.
The length to maturity for an investment in any Federal Instrumentality is five (5)
years from the date of purchase. Maturities longer than five (5) years require the
City's approval.
D. Non-Negotiable Interest Bearing Time Certificates of Deposit
Non-negotiable interest bearing time certificates of deposit or savings accounts in
banks organized under the laws of this state and/or in national banks organized
under the laws of the United States and doing business and situated in this state,
provided that banks aRy suGh dep '+ are listed as Florida Qualified Public
Depositories (QPDs) under the Florida Public Deposits Act, Chapter 280.
https:limvfloridacfc.com/docs-sf/treasury-libraries/treasury-
documents/listofactivegpds.13df
A maximum of 50%of available funds maybe invested in non-negotiable interest
bearing time certificates of deposit or savings accounts.
A maximum of 25%of available funds maybe deposited with any one issuer.
The maximum maturity on any certificate shall be no greater than ^^eer„ (I)-Tea;-three
3 ears from the date of purchase.
E. Repurchase Agreements
�641;eFized Staff rpay invest PR FepUFGhase agreerneRtS GOFnpF;sed af only these
.—�
City of Edgewater Page 8 of 13
invcstments h-+�ed AR t e Fe ents set fe Fth by the Gi Y's Master RePWFG
[SM(131
Agr-eement. All firms with whom the City enters into repurchase agreements will
have in place an executed Master Repurchase Agreement with the City.
A third party custodian shall hold collateral for all repurchase agreements with a
term longer than one (1) business day.
Securities authorized for collateral are negotiable direct obligations of the United
States Government and Federal Instrumentalities with maturities under five (5)
years and must have a mark-to-market value at a minimum of 102 percent during
the term of the repurchase agreement. Immaterial short-term deviations from 102
percent requirement are permissible only upon the approval of the Authorized
Staff.
A maximum of 50% of available funds may be invested in repurchase agreements
with the exception of one(1) business day agreements,overnight sweep
agreements.
A maximum of 25% of available funds may be invested with any one institution
with the exception of one (1) business day agreements, overnight sweep
Agreements.
The maximum length to maturity of any repurchase agreement is 60 days from the
settlement date.
F. Commercial Paper
Commercial paper issued by a United States company rated, at the time of
purchase, "113-1" by Moody's, and "A-1" or better by Standard Poor's. If backed by a
letter of credit(LOC), the long-term debt of the LOC provider must be rated at least
"A" by at least two nationally recognized rating agencies at the time of purchase.
The LOC provider must be ranked in the top fifty(50) United States banks in terms
of total assets by the American Banker's yearly report.
A maximum of 25% of available funds may be directly invested in prime commercial
paper.
A maximum of 4510%of available funds may be invested with any one issuer.
The maximum maturity shall be 270 days from the settlement date.
G. Corporate Notes
Corporate notes issued by corporations organized and operating within the United
States or by depository institutions licensed by the United States that have a long
term debt rating at the time of purchase with a minimum "Aa" by Moody's and a
minimum of"AA"by Standard & Poor's.
A maximum of 25% of available funds may be directly invested in corporate notes.
A maximum of 2-110% of available funds may be invested with any one issuer.
The maximum length to maturity for corporate notes shall be 3 years from the date
of purchase.
City of Edgewater Page 9 of 13
H. Bankers Acceptances
Banker's acceptances, which are issued by a domestic bank, which has at the time
of purchase, an unsecured, un-insured and un-guaranteed obligation rating of at
least "Prime-1" by Moody's or "A-1" by Standard Poor's. The bank must be ranked
in the top fifty (50) United States banks in terms of total assets by the American
Banker's yearly report.
A maximum of ldsrol «%of available funds may be directly invested in bankers'
acceptances.
A maximum of 2-010%of available funds may be invested with any one issuer.
The maximum length to maturity for bankers'acceptances shall be 180 days from
the date of purchase.
I. State and/or Local Government Taxable and/or Tax-Exempt Debt
General obligation and/or revenue bonds rated at least"Aa" by Moody's or"AA" by
Standard &Poor's for long-term debt, or"MIG-2"by Moody's or"SP-2" by Standard
Poor's for short-term debt.
A maximum of 20%of available funds may be invested in taxable and tax-exempt
debt.
A maximum of 2810%of available funds may be invested with any one issuer.
A maximum length to maturity for an investment in any state or local government
debt security is three (3) years from the date of purchase.
J. Registered Investment Companies (Money Market Mutual Funds)
Open-end and no-load money market funds provided such funds are registered
under the Federal Investment Company Act of 1940 and operate in accordance with
17 C.F.R. §2a-7,which stipulates that money market funds must have an average
weighted maturity of 59L60 ksm(i5ldays or less. In addition, the share value of the
money market fund must be equal to$1.00.
A maximum of 50% of available funds may be invested in money market funds.
A maximum of 25% of available funds may be invested with a single money market
fund.
The money market funds shall berated Ino less than AAArn SM(lbl"
G"-by Standard&Poor's or the equivalent by another rating agency.
A thereugh review Gf a r rngRey market fund is Fequired prier to investing and an a
r hnsis There shall he a estieggaire developed by the Finanne Direntnr
that 1.4,411 r.ontain a last Gf ques-tim-Ra- that r_,avers the rAajGF a6peGtS Of aAY
K. Other Intergovernmental Investment Pools
Intergovernmental investment pools, rated AAAm or equivalent, that are authorized
pursuant to the Florida Interlocal Cooperation Act, as provided in s.163.01, F. S.
City of Edgewater Page 10 of 13
s�
A maximum of 25% of available funds may be invested in intergovernmental
investment pools.
� thaFeu gh r view ef and Gn
'
a nnntin, al basis. TheFe shall be a-questionnaire d by the C:nnn^n
nirnntr.r that i rill nnta'n o loot Of n BSt'n c that n eFs the mains aceeGtS Of aRY
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XIII. PERFORMANCE MEASUREMENTS
In order to assist in the evaluation of the portfolios' performance, the City will use performance
benchmarks for short-term and long-term portfolios. The use of benchmarks will allow the City to
measure its returns against other investors in the same markets.
A. Investment performance of funds designated as short-term funds and other funds
that must maintain a high degree of liquidity will be compared to the rolling average
return on the six-month U.S. Treasury Bill. Investments of♦� ,rant ^ rat'n
shell have matuFities ef no IGn9er than tWeRtV_fGUF(24) mnntH�c
B. Investment performance of funds designated as core funds and other non-operating
funds that have a longer-term investment horizon will be compared to an index
comprised of U.S. Treasury or Government securities. The appropriate index will
have a duration and asset mix that approximates the portfolios and will be utilized
as a benchmark to be compared to the portfolios'total rate of return. Investments of
bond reserves, construction funds, and other non-operating funds ("core funds")
shall have a term appropriate to the need for funds and in accordance with debt
covenants, but in no event shall exceed five(5) years.
XIV. REPORTING
The Finance Director, management designee and/or Investment Advisor shall provide the City
Manager with a"Quarterly Investment Report"that summarizes but not limited to the following:
A. Recent market conditions, economic developments and anticipated investment
conditions.
B. The investment strategies employed in the most recent quarter.
C. A description of all securities held in investment portfolios at month-end.
D. The ,average portfolio yield'is mo9ltntal rata of r�for the quarter and year-to-date
versus appropriate benchmarks.
E. Any areas of the Policy concern warranting possible revisions to current or planned
investment strategies. The market values presented in these reports will be
consistent with accounting guidelines in GASB Statement 31.
On an annual basis, the City Manager designee shall submit to the City Council a written report on
all invested funds. The annual report shall provide all, but not limited to the following_a complete list
of all funds, security descriptions including issuer name, coupon rate, par amount, book and market
value, trade date, settlement date, and maturity date.
The annual report will shGw pertnrma
compare portfolio performance to the results to tho above-stated performance benchmarks. All
investments shall be reported at fair value per GASB Statement 31. If an investment held by the
City of Edgewater Page 1 1 of 13
City &4a-Il-falls below the required Moody's or Standard Poor's rating,this shall be included in the
Investment report. The Council shall have the option to discuss and affirm or atter sell the saw
downgraded investment-4eldh� the City. Investment reports shall be available to the public.
XV. THIRD PARTY CUSTODIAL AGREEMENTS
Securities, with the exception of certificates of deposits, shall be held with a third-party custodian;
and all securities purchase by, and all collateral obtained by the City should be properly designated
as an asset of the City. The securities must be held in an account separate and apart from the
assets of the financial institution. A third-party custodian is defined as any bank depository
chartered by the Federal Government, the State of Florida, or any other state or territory of the
United States which has a branch or principal place of business in the State of Florida, or by a
national association organized and existing under the laws of the United States which is authorized
to accept and execute trusts and which is doing business in the State of Florida. Certificates of
deposits will be placed in the provider's safekeeping department for the term of the deposit.
The custodian shall accept transaction instructions only From those persons who have been duly
authorized by the City Manager and which authorization has been provided, in writing, to the
custodian. No withdrawal of securities, in whole or in part, shall be made from safekeeping, shall be
permitted unless by such a duly authorized person.
The custodian shall provide the Finance Director or management designee with safekeeping
statements that provide detailed information on the securities held by the custodian. On a monthly
basis, the custodian will also provide reports that list all securities held for the City, the book value of
holdings and the market value as of month-end. If an iRve truant falls below the requiFed enGad
r Stnpcinrd PGGr'r rte.}inn thP AWMAdiAR Shall .,r.lif y Oho CinAnn.m- Dirr.ntAr wathi., 2
All Ssecurity transactions of the CitV aCnP hrnkLgr1dPAlor unci the im lvino +ho
purGrhrase nr ale of sen-uritieG by transfer r.f FAGney oGu4 in 'rust be made on a "delivery vs.
payment" basis, if-a plisable, to ensure that the custodian will have the security or money, as
appropriate, in hand at the conclusion of the transaction. Securities held as collateral shall be held
free and clear of any liens.
XVI. INVESTMENT COMMITTEE
The Finance Director with the approval of the City Manager may establish an Investment Committee
for the purpose of formulating alternative investment strategies 9F6 WithiR the
quidelinn herein et fGFth ^nd for monitoring the performance and structure of the City's portfolio.
The Committee may include the Finance Director as Chairman, the City's Investment Advisor and
other staff members as designated by the City Manager. In lieu of formal establishment of an
investment committee the Finance Director may evaluate and manage the investment portfolio
solely with the City's Investment Advisor.
A designee of the Finance Director may provide the Committee members with current market
information, an updated portfolio listing and analysis, and various pertinent financial data. The
Committee or quorum of the committee shall meet as often as deemed necessary, under the gi„on
GGRditiORS, to review, discuss and affirm or alter the current investment strategy and perform other
functions as herein provided.
The Investment Committee activities Gan-include but are not ,'limited to review and setting of
investment strategies; review and establishing of written investment procedures; review and
approval of bank and other rating agency services; review and approval of source documentation
regarding issuers, and dealers, and any other functions as defined herein.
XVII. INTERNAL LOAN PROGRAM
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This section governs the extension of internal loans from the City's internal liquidity resources of the
Pooled Cash Fund for the purpose of financing capital construction projects or capital outlay
expenditures for which external financial is not available, or for providing interim financing for
municipal strategic initiatives for which a gap exists between the acquisition or construction of a
project and the timing of the cash receipts from planned sources of funding including permanent
debt financing,federal and state grants, fees and charges and cash from general operating sources.
Internal loans will be utilized to provide a short to medium term financing alternative for departments
seeking to finance such capital projects/capital outlay expenditures, in a manner that does not
detract from the overall City portfolio investment objectives and liquidity requirements. All internal
loans under the Program must be approved by the City Council. The Finance Director will
promulgate general objectives, guidelines and financial reporting of administration of Program.
XVIII. INVESTMENT POLICYADOPTION
The Investment Policy shall be adopted by City resolution. The Finance Director apd-Qity's
FiRaasla4&m(2ij Advisor�'�rshall review the Policy annually and submit recommendations to the City
Manager for review and approval. If a change in the Policy is recommended for approval by the City
Manager, the Finance Director will prepare the necessary report to Council.
Approved by the City Council of the City of
Edgewater at a meeting held on the 3r4
day- le day of WaF-Gh 2014November
under Agenda Item 8e Resolution No.
'nom;-r'4 2022-R-34.
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