(A) In addition to any other statutory powers to make investments, the Clerk-Treasurer may invest funds in accordance with I.C. 5-13-9 under these guidelines established by the Crawfordsville Common Council. I.C. 5-13-9-1(a).
(B) The funds that may be invested by the Clerk-Treasurer under this policy include money raised by bonds issued for future specific purposes, sinking funds, depreciation reserve funds, gift, bequest or endowment, and any other funds available for investment. I.C. 5-13-9-1(c);
(C) The Clerk-Treasurer may invest or reinvest any funds held and available for investment in any of the following:
(1) Securities backed by the full faith and credit of the U.S. Treasury or fully guaranteed by the U.S. and issued by any of the following:
(a) The U.S. Treasury;
(b) A Federal agency;
(c) A Federal instrumentality; and
(d) A Federal government sponsored enterprise.
(2) Securities fully guaranteed and issued by any of the following:
(a) A Federal agency;
(b) A Federal instrumentality;
(c) A Federal government sponsored enterprise.
(3) Municipal securities issued by an Indiana local government entity, a quasi-governmental entity related to the state, or any unit of government, municipal corporation, or special taxing district in Indiana, if:
(a) The issuer has not defaulted on any of the issuer's obligations within the 20 years preceding the date of purchase. I.C. 5-13-9-2; and
(b) The Clerk-Treasurer obtains approval from the Mayor and Common Council.
(D) If an investment under division (C) above (I.C. 5-13-9-2(a)) is made at a cost in excess of the par value of the securities purchased, any premium paid for the securities purchased shall be deducted from the first interest received and returned to the fund from which the investment was purchased, and only the net amount is considered interest income. I.C. 5-13-9-2(b).
(E) The Clerk-Treasurer may sell any securities acquired and may do anything necessary to protect the interests of the funds invested, including the exercise of exchange privileges which may be granted with respect to maturing securities in cases where the new securities offered in exchange meet the requirements for initial investment. I.C. 5-13-9-2(c).
(F) The Clerk-Treasurer is the legal custodian of the securities which the city has invested, and he or she shall accept safekeeping receipts or other reporting for securities from:
(1) A duly designated depository; or
(2) A financial institution located either in or out of Indiana having custody of securities with a combined capital and surplus of a at least $10,000,000 according to the last statement of condition filed by the financial institution with its governmental supervisory body. I.C. 5-13-9-2(d).
(G) The Clerk-Treasurer may invest funds or reinvest funds that are held by the Clerk-Treasurer and available for investment in investments commonly known as money market mutual funds that are in the form of securities of or interests in an open-end, no-load, management-type investment company or investment trust registered under the provisions of the Federal Investment Company Act of 1940, as amended. These investments shall be made through depositories designated by the state board of finance as depositories for state deposits under I.C. 5-13-9.5.
(1) The portfolio of an investment company or investment trust described above must be limited to the following:
(a) Direct obligation of the United States;
(b) Obligations issued by any of the following:
1. A Federal agency;
2. A Federal instrumentality; and
3. A Federal government sponsored enterprise.
(c) Repurchase agreements as defined by I.C. 5-13-9-3(a), fully collateralized by direct obligations of the U.S. or by a Federal agency, a federal instrumentality, or a federal government sponsored enterprise.
(2) The form of securities of or interests in an investment company or investment trust must be rated as one of the following:
(a) AAAM, or its equivalent, by Standard and Poor's Corporation or its successor;
(b) AAA, or its equivalent, by Moody's Investment Service, Inc. or its successor.
(3) The form of securities in an investment company or investment trust described above is considered to have a stated final maturity of one day. I.C. 5-13-9-2.5.
(H) The Clerk-Treasurer may enter into repurchase agreements, as defined in I.C. 5-13-9-3(a), with any funds that are held by the Clerk-Treasurer and available for investment, as follows:
(1) With depositories designated by the state board of finance as depositories for state deposits under I.C. 5-13-9.5; and
(2) Involving the City's purchase and guaranteed resale of any interest-bearing obligations issued or fully insured or guaranteed by the United States, a United States government agency, an instrumentality of the United States, or a federal government sponsored enterprise.
(3) The Clerk-Treasurer may invest in repurchase agreements without entering into a contract under I.C. 5-13-11 for an investment cash management system. I.C. 5-13-9-3.
(I) The Clerk-Treasurer may invest or reinvest any funds that are held by the Clerk-Treasurer and available for investment in obligations issued, assumed, or guaranteed by the International Bank for Reconstruction and Redevelopment or the African Development Bank. I.C. 5-13-9-3.3.
(J) The Clerk-Treasurer may deposit, invest, or reinvest any funds that are held by the Clerk-Treasurer and available for investment in transaction accounts issued or offered by a designated depository of the City for the rates and terms agreed upon periodically by the Clerk-Treasurer and the designated depository. I.C. 5-13-9-4(a):
(1) When making a deposit in a certificate of deposit, the Clerk-Treasurer shall obtain quotes of the specific rates of interest for the term of that certificate of deposit that each designated depository will pay on the certificate of deposit. Quotes maybe solicited and taken by telephone. A memorandum of all quotes solicited and taken shall be retained by the Clerk-Treasurer as a public record under I.C. 5-14-3.
(2) If the deposit is not placed in the designated depository quoting the highest rate of interest, the Clerk-Treasurer shall place the deposit in the depository quoting the second or third highest rate of interest and note the reason for placing the deposit on the memorandum of quotes.
(3) If all of the designated depositories of the city decline to issue or receive any deposit account, or to issue or receive the deposit account at a rate of interest equal to the highest rate being offered other investors, the Clerk-Treasurer may invest in the deposit accounts of any financial institution designated for state deposits as a depository by the state board of finance under I.C. 5-13-9.5 and I.C. 5-13-9-4.
(K) The Clerk-Treasurer may invest in certificates of deposit of depositories that have not been designated by the Montgomery City Board of Finance but have been designated by the Indiana Board of Finance as a depository for state deposits under I.C. 5-13-9.5. For such investments, the Clerk-Treasurer shall solicit quotes for the certificate of deposit and follow the procedures specified in I.C. 5-13-9-5(b) and (c).
(L) The Clerk-Treasurer may invest public funds in interest bearing deposit accounts, as defined by I.C. 5-13-9-5.3(a), in accordance with the following conditions:
(1) The funds are initially invested through a depository that is selected by the Clerk-Treasurer.
(2) The selected depository arranges for the deposit of the funds in interest bearing deposit accounts in one or more federally insured banks or savings and loan associations, wherever located, for the city's account.
(3) The full amount of the principal and any accrued interest of each deposit are covered by insurance of any Federal deposit insurance agency.
(4) The selected depository acts as a custodian for the city with respect to the deposits.
(5) On the same date that the city's funds are deposited, the selected depository receives an amount of deposits covered by insurance of any federal deposit insurance agency from customers of other institutions, wherever located, at least equal to the amount of the funds invested by the city through the selected depository.
(6) Public funds invested in accordance with this section are not subject to any security or pledging requirements that may otherwise be applicable to the deposit or investment of public funds.
(7) For purposes of this section, "deposit account" does not include any interest-bearing account that is authorized to be set up and offered by a financial institution in the course of its respective business. I.C. 5-13-9-5.3.
(M) The investment of public funds shall be made in accordance with I.C. 5-13-9-5.7 and with the Clerk-Treasurer's approval.
(N) The investment of public funds under this Policy shall be limited to not more than 25% of the total portfolio of public funds invested by the City, including balances in transaction accounts. I.C. 5-13-9-5.7.
(O) Interest derived from investments under this Policy shall be deposited and receipted in accordance with I.C. 5-13-9-6.
(1) The Clerk-Treasurer may invest tax collections under this policy pending distribution of the collections to political subdivisions. These investments may not: exceed the amount available after considering taxes that may need to be advanced to any political subdivision; or be made in deposit accounts or repurchase agreements, the maturity dates of which are later than the time when the tax collections are required by law to be distributed to political subdivisions.
(2) The interest received on the investments under division (N)(1) above shall be receipted to the city general fund or any other fund from which expenses incurred in the maintenance of city streets maybe paid. The Crawfordsville Common Council shall determine the allocation of this interest among the general fund and the various highway funds into which the interest may be deposited.
(3) Interest derived from the investment of the proceeds from bonded indebtedness or local tax levies maybe applied to the appropriate redemption bond interest or sinking fund for the bonded indebtedness.
(4) If meter deposits of a municipally owned utility are invested, the interest earned on the investment may be applied to and used in the operation or depreciation fund of the municipally owned utility as determined by its governing body.
(5) Interest from the investment of the city's public funds may not be paid personally or for the benefit of any public officer. I.C. 5-13-9-6.
(P) (1) The Clerk-Treasurer maybe required to pay a service charge to the depository in which funds are deposited, if the depository requires ah customers to pay the charge for providing the service. However, the service charge imposed must be considered in the computation of the interest rate for determining which depositories are entitled to investments as prescribed by this policy. If the total service charge cannot be computed before the investment, the Clerk-Treasurer shall estimate the service charge and adjust 'the interest rate based on this estimate. The service charge may be paid:
(a) By direct charge to the deposit or other account; or
(b) In a manner that subtracts the service charge from interest earned on the funds in the deposit or other account.
(2) If the service charge is paid in the second manner, the Clerk-Treasurer must report the net interest deposited in the city's financial records, and the Clerk-Treasurer is not required to report the amount of the service charge subtracted in the City's financial records. I.C. 5-13-9-8.
(Q) Funds deposited in deposit accounts in accordance with I.C. 5-13-9 and this Policy and interest earned or accrued on the funds are public funds and are covered by the insurance fund, as defined in I.C. 5-13-4-15 and I.C. 5-13-9-8.5.
(R) The Clerk-Treasurer may not purchase securities on margin or open a securities margin account for the investment of public funds. I.C. 5-13-9-9.
(S) The Clerk-Treasurer and the investing officers of other political subdivisions located within Montgomery City may establish joint investment funds by entering into a written master agreement that defines their rights and obligations, as provided in I.C. 5-13-9-10.
(T) The Clerk-Treasurer may pay any funds held by him or her into the local government investment pool, as defined by I.C. 5-13-9-11(b), for the purpose of deposit, investment, and reinvestment of the funds by the Treasurer of the state on behalf of the city in accordance with I.C. 5-13-9-11.
(U) This policy will expire four years after it takes effect.
(Ord. 21-2018, passed 9-10-18)