(a) It is the purpose of this statement to set forth the public policies of the city relating to the investment of public monies, and establish procedural requirements as to investment management practice.
(b) The objective of the investment policy and program of the city shall be as follows.
(1) The safeguarding of all public monies shall be of the highest priority. Public money shall not be invested or managed in any matter which would jeopardize the safety of the principal.
(2) Consistent with the requirement of safety, the objective of the investment program shall be to aggressively manage and invest all public monies to maximize net earnings, consistent with the public responsibility to secure maximum, safe investment return possible from monies assigned to its stewardship, to relieve demands on the property tax, and to otherwise reduce the cost of public services.
(a) The governing body shall designate the banks, savings and loan associations and savings banks which shall serve as depositories of its funds. The Clerk, Treasurer or other city officer or employee having the custody of city funds shall deposit such funds only at the designated banks, savings and loan associations and savings banks. Only banks, savings and loan associations and savings banks that have main or branch offices in the county shall be designated as official depositories. No such bank, savings bank or savings and loan association shall be designated as a depository until the city is assured that it can obtain satisfactory security for its deposits.
(b) The Clerk, Treasurer or other city officer or employee depositing public funds shall deposit all such public funds coming into such person’s possession in his, her or their name and official title as such officer. If the governing body fails to designate an official depository or depositories, the officer thereof having custody of city funds shall deposit such funds with one or more banks, savings and loan associations or savings banks which have main or branch offices in the county if satisfactory security can be obtained therefor and if not then elsewhere. In such event, the officer or employee shall serve notice in writing on the governing body showing the names and locations of such banks, savings and loan associations and savings banks where such funds are deposited and upon so doing the officer or employee having custody of such funds shall not be liable for the loss of any portion thereof except for official misconduct or for the misappropriation of such funds by the officer or employee.
(c) If eligible banks, savings and loan associations or savings banks under divisions (a) or (b) above cannot or will not provide an acceptable bid, which shall include services for the depositing of public funds under this section, then banks, savings and loan associations or savings banks that have main or branch offices in any immediately adjoining county may receive deposits of the city’s active funds, if such banks, savings and loan associations or savings banks have been designated as official depositories under division (a) above and the city can obtain satisfactory security therefor.
For the purpose of this article, the following definitions shall apply unless the context clearly indicates or requires a different meaning.
BANK. Any bank incorporated under the laws of the state or any other state, or organized under the laws of the United States and which has a main or branch office in the state.
BRANCH. Any office within this state, other than the main office, that is approved by a federal or state supervisory agency at which deposits are received, checks paid or money lent. BRANCH does not include an automated teller machine, remote service unit or similar device or a loan production office.
INVESTMENT RATE. A rate which is the equivalent yield for United States government securities having a maturity date as published in the Wall Street Journal, nearest the maturity date for equivalent maturities. The zero- to 90-day rate shall be computed on the average effective federal funds rate as published by the Federal Reserve System for the previous week.
MAIN OFFICE. The place of business specified in the articles of association, certificate of authority or similar document, where the business of the institution is carried on and which is not a branch.
SAVINGS AND LOAN ASSOCIATION. Any savings and loan association incorporated under the laws of the state or any other state, or organized under the laws of the United States and which has a main or branch office in the state.
SAVINGS BANK. Any savings bank organized under the laws of the United States and which has a main or branch office in the state.
(K.S.A. 12-1675a)
Temporarily idle monies of the city not currently needed, may in accordance with the procedure hereinafter described be invested:
(a) In temporary notes or no-fund warrants issued by the city;
(b) In savings deposits, demand deposits, time deposit, open accounts, certificates of deposit or time certificates of deposit with maturities of not more than two years:
(1) In banks, savings and loan associations and savings banks which have main or branch offices located in the city; or
(2) If no main or branch office of a bank, savings and loan association or savings bank is located in the city, then in banks, savings and loan associations and savings banks, which have main or branch offices in the county or counties in which all or part of the city is located.
(c) In repurchase agreements with:
(1) Banks, savings and loan associations and savings banks, which have main or branch offices located in the city, for direct obligations of, or obligations that are insured as to principal and interest by, the United States government or any agency thereof;
(2) If no main or branch office of a bank, savings and loan association or savings bank, is located in the city. If no such bank, savings and loan association or savings bank having a main or branch office located in the city is willing to enter into such an agreement with the city at an interest rate equal to or greater than the investment rate, as defined in K.S.A. 12-1675a(g), and amendments thereto, then such repurchase agreements may be entered into with banks, savings and loan associations or savings banks which have main or branch offices in the county or counties in which all or part of the city is located; or
(3) If no bank, savings and loan association or savings bank, having a main or branch office in such county or counties is willing to enter into such an agreement with the city at an interest rate equal to or greater than the investment rate, as defined in K.S.A. 12-1675a(g), and amendments thereto, then such repurchase agreements may be entered into with banks, savings and loan associations or savings banks located within the state.
(d) In direct obligations of or obligations that are insured as to principal and interest by the United States or any agency thereof, not including mortgage-backed securities with maturities as the governing body shall determine, but not exceeding two years. Such investment transactions shall only be conducted with banks, savings and loan associations and savings banks; the Federal Reserve Bank of Kansas City, Missouri; or with primary government securities dealers which report to the market report division of the Federal Reserve Bank of New York, or any broker-dealer engaged in the business of selling government securities which is registered in compliance with the requirements of §§ 15 or 15C of the Securities Exchange Act of 1934 and registered pursuant to K.S.A. 17-12a401, and amendments thereto;
(e) In the Municipal Investment Pool Fund established in K.S.A. 12-1677a, and amendments thereto;
(f) In the investments authorized and in accordance with the conditions prescribed in K.S.A. 12-1677b, and amendments thereto;
(g) In multiple municipal client investment pools managed by the trust departments of banks which have main or branch offices located in county or counties where city is located or with trust companies incorporated under the laws of this state which have contracted to provide trust services under the provisions of K.S.A. 9-2107, and amendments thereto, with banks which have main or branch offices located in the county or counties in which the city is located. Public monies invested under this division (g) shall be secured in the same manner as provided for under K.S.A. 9-1402, and amendments thereto. Pooled investments of public monies made by trust departments under this division (g) shall be subject to the same terms, conditions and limitations as are applicable to the municipal investment pool established by K.S.A. 12-1677a, and amendments thereto;
(h) The investments authorized in divisions (d), (e), (f) or (g) above shall be utilized only if the banks, savings and loan associations and savings banks eligible for investments authorized in division (b) above, cannot or will not make the investments authorized in division (b) above available to the city at interest rates equal to or greater than the investment rate, as defined in K.S.A. 12-1675a(g), and amendments thereto; or
(i) In selecting a depository pursuant to division (b) above, if a bank, savings and loan association or savings bank eligible for an investment deposit thereunder has an office located in the city and such financial institution will make such deposits available to the city at interest rates equal to or greater than the investment rate, as defined in K.S.A. 12-1675a(g), and amendments thereto, and such financial institution otherwise qualifies for such deposit, the governing body shall select one or more of such eligible financial institutions for deposit of funds pursuant to this section. If no such financial institution qualifies for such deposits, the city shall select for such deposits one or more eligible banks, savings and loan associations or savings banks which have offices in the county or counties in which all or a part of the city is located which will make such deposits available to the city at interest rates equal to or greater than the investment rate, as defined in K.S.A. 12-1675a(g), and amendments thereto, and which otherwise qualify for such deposits.
(K.S.A. 12-1675)
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