A. It is the intention of this policy to allow for the investment of public funds in a manner which will provide the maximum security of principal, while meeting the daily cash flow demands of the City, conforming to all State and local statutes governing the investment of public funds, and providing the highest practical investment return within applicable legal guidelines.
B. The primary objectives, in priority order, of the City of Elgin investment activities shall be:
1. Safety of principal is the foremost objective of the investment program. Investments of the City shall be undertaken in a manner that seeks to ensure the preservation of capital in the overall portfolio.
2. All investment transactions will be in accordance with all applicable State and Federal Statutes, this Code, and the tenets of this investment policy.
3. The City of Elgin's investment portfolio will remain sufficiently liquid to enable the City to meet all day-to-day cash flow requirements.
4. The portfolio shall be designed with the objective of attaining a market average rate of return throughout budgetary and economic cycles, taking into account the City's investment risk constraints and the cash flow characteristics of the portfolio.
C. The City of Elgin is authorized by Oklahoma Statutes title 62, section 348.3, to invest in the following types of securities:
1. Obligations of the United States government, its agencies and instrumentalities;
2. Collateralized or insured certificates of deposit and other evidences of deposit at banks, savings banks, savings and loan associations and credit unions located in this State, or fully insured certificates of deposit at banks, savings banks, savings and loan associations and credit unions located out of State;
3. Negotiable certificates of deposit issued by a nationally or state-chartered bank, a savings bank, a savings and loan association or a state-licensed branch of a foreign bank. Purchases of negotiable certificates of deposit shall not exceed ten percent (10%) of the surplus funds of the City which may be invested pursuant to this section. Not more than one-half (1/2) of the ten percent (10%) limit shall be invested in any one financial institution specified in this paragraph;
4. Prime banker's acceptances which are eligible for purchase by the Federal Reserve System and which do not exceed two hundred seventy (270) days' maturity. Purchases of prime banker's acceptances shall not exceed ten percent (10%) of the surplus funds of the City which may be invested pursuant to this section.
5. Prime commercial paper which shall not have a maturity that exceeds one hundred eighty (180) days nor represent more than ten percent (10%) of the outstanding paper of an issuing corporation. Purchases of prime commercial paper shall not exceed seven and one-half percent (71/2%) of the surplus funds of the City which may be invested pursuant to this section;
6. Repurchase agreements that have underlying collateral consisting of those items specified in subsections C1 through C5 of this section; and
7. Money market funds regulated by the Securities and Exchange Commission and which investments consist of those items and those restrictions specified in subsections C1 through C6 of this section.
D. The City of Elgin will diversify its investments by institution with the exception of United States Treasury and agency securities. No more than fifty percent (50%) of the City's investment portfolio will be placed through a single financial institution.
E. To the extent possible, the City of Elgin will attempt to match investments with anticipated cash flow requirements. Unless matched to a specific cash flow, the City of Elgin will not directly invest in securities maturing more than three (3) years from the date of purchase.
F. To the extent practicable, the City of Elgin shall utilize a system of competitive bidding in the investment of Municipal funds.
1. Before investments of surplus funds are placed, a competitive telephone, or electronic “bid” process (consisting of quoted interest or yield rates, dollar prices, or discount rates) shall be conducted. Certificates of deposit will be bid among approved depository banking institutions, while other investment instruments will be bid among security dealers approved by the City Council. Bids will be secured from at least three (3) institutions, if possible. Bidders are required to bid a firm price or yield, which will remain effective for a reasonable period of time (approximately 30 minutes), given market fluctuations, to allow further bids to be received. Typically, awards will be made to the bidder offering the highest effective yield consistent with policy restrictions; however, transaction costs, diversification requirements, and other factors may be considered when awarding investments such as maintaining a local presence. (Ord. 18-09, 10-9-2018; amd. Ord. 21-32, 7-13-2021)