(A) From the city's perspective, special care must be taken to ensure that the list of instruments includes only those allowed by law and those that local investments managers are trained and competent to handle. No public deposit shall be made except in a qualified public depository as established by South Carolina State law. The Finance Director will not give full discretionary authority to external investment managers. The Finance Director will not use external investment managers to purchase or sell securities or manage the city's portfolio unless specifically approved by the City Council with a contract signed by the Mayor and reviewed by the City Attorney.
(B) Pursuant to S.C. Code § 11-1-60, the state or any department, institution, agency, district, county, municipality or other political subdivision of the state or any political or public corporation of the state or of the United States may invest its funds or the monies in its custody or possession eligible for investment in the shares of any federal savings and loan association or in the shares of any building and loan association organized and existing under the laws of this state when such shares are insured by the Federal Savings and Loan Insurance Corporation and also in bonds or debentures issued by any federal home loan bank or in the consolidated bonds or debentures issued by the Federal Home Loan Bank Board.
(C) S.C. Code § 6-5-10 limits the investment vehicles available to local agencies. The city investment policy further restricts the permitted investments to those listed below:
(1) Obligations of the United States and its agencies, the principal and interest of which is fully guaranteed by the United States. United States Treasury Bills, Notes and Bonds or those for which the full faith and credit of the United States are pledged for payment of principal and interest: A rated or better offerings.
(2) Federal agency or United States government sponsored securities including those issued by or fully guaranteed as to principal and interest by federal agencies or United States Government sponsored enterprises. Obligations in this category referred to as "federal agencies" included but are not limited to issues by the Government National Mortgage Association, Federal Mortgage Association, and Federal Home Loan Mortgage Corporation: A rated or better offerings.
(3) Savings and loan associations to the extent that the same are insured by an agency of the federal government: A rated or better offerings.
(4) Certificates of deposit. Certificates of deposit are fixed-term investments that are required to be collateralized depending on the specific security pledged as security. The city shall deposit funds only with financial institutions that operate in the United States of America. The Federal Deposit Insurance Corporation (FDIC) must insure these institutions.
(5) General obligations of any of the counties, political subdivisions or municipal corporations of any state of the United States of America: A rated or better offerings.
(6) Revenue bonds of any of the counties, political subdivisions or municipal corporations of any state of the United States of America; if the statute pursuant to which such revenue bonds are issued shall declare them to be legal investments: A rated or better offerings.
(7) Stable value money market mutual funds. These types of investments are to be used primarily as overnight or short-term sweep accounts for interest and maturities with the city's custodial agent and the city's bank accounts.
(8) S.C. Code § 6-6-30 allows for the sale of investments within the State of South Carolina Local Government Investment Pool (SCLGIP) to all political subdivisions with consent of the governing bodies. Money invested with SCLGIP is pooled with state money in order to earn the maximum rate of return possible in a manner consistent with sound investment practices.
(Ord. 16-21, passed 6-8-21)