(a) Policy Adopted. There is hereby adopted in and for the Village, in compliance with S.B. No. 81, an investment policy as set forth herein.
(b) Scope. The investing authority for the Village shall reside with the Fiscal Officer in accordance with this investment policy. This policy is designed to cover all monies under the control of the Fiscal Officer and those that comprise the core investment portfolio. Notwithstanding the policies detailed in this section, Ohio R.C. Chapter 135 will be adhered to at all times.
(c) Objectives and Guidelines. The following investment objectives will be applied in the management of Village funds:
(1) The primary objective shall be the preservation of capital and the protection of principal while earning investment interest.
(2) In investing public funds, the Fiscal Officer will strive to exceed or at least equal the average market rate of return on the investment portfolio over the course of budgetary and economic cycles, taking into account State law, safety considerations and cash flow requirements.
(3) The investment portfolio shall remain sufficiently liquid to enable the Fiscal Officer to meet reasonably anticipated operating requirements.
(4) The investment portfolio shall be diversified in order to avoid incurring potential losses regarding individual securities which may not be held to maturity, whether by erosion of market value or change in market conditions, that will not exceed the income generated by the portfolio.
(5) Investments shall be made with the exercise of that degree of 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.
(6) Bank account relationships will be managed in order to secure adequate services while minimizing costs. Deposits should be concentrated in single accounts except where audit control considerations dictate otherwise.
(d) Maturity. At the time of making an investment, the Fiscal Officer should reasonably expect that the investment can be held to maturity. To the extent possible, the Fiscal Officer will attempt to match the investments with anticipated cash flow requirements. Unless matched to a specific cash flow requirement, the Fiscal Officer will not directly invest in securities maturing more than five years from the settlement date of purchase.
(e) Authorized Financial Institutions and Dealers. U.S. Treasury and agency securities purchased outright shall be purchased only through financial institutions located within the State or through primary securities dealers as designated by the Federal Reserve Board. Repurchase agreements shall be transacted only through banks located within the State with which the Fiscal Officer has signed a Master Repurchase Agreement as required in Ohio R.C. Chapter 135.
Certificates of deposit shall be transacted through commercial banks or savings and loans with FDIC or FSLIC coverage which are located within the State and qualify as eligible financial institutions under Ohio R.C. Chapter 135.
A list of authorized institutions and dealers shall be maintained by the Fiscal Officer. Additions and deletions to this list shall be made when deemed in the best interest of the Village.
(f) Derivatives. Investments in derivatives and in stripped principal or interest obligations of eligible obligations are strictly prohibited. “Derivative” means a financial instrument or contract or obligation whose value or return is based upon or linked to another asset or index, or both, separate from the financial instrument, contract or obligation itself. Additionally, any security, obligation, trust account or instrument that is created from an obligation of a Federal agency or instrumentality or is created from both is considered a derivative instrument.
(g) Authorized Investments. The Fiscal Officer may invest in any instrument or security authorized by Ohio R.C. Chapter 135, as amended. A copy of the appropriate Ohio Revised Code section will be kept with this policy.
(h) Collateral. All investments and deposits shall be collateralized pursuant to Ohio R.C. Chapter 135.
(i) Reporting. The Fiscal Officer shall establish and maintain an inventory of all obligations and securities acquired by the Village. The inventory shall include a description of the security and its type, cost, par value, maturity date, settlement date and coupon rate. The Fiscal Officer shall produce a monthly portfolio report detailing the current inventory of all obligations and securities, all transactions which occurred during the month, detailing income received and investment expenses paid, and the names of any persons effecting transactions on behalf of the Village.
(j) Committee Meetings. Council or a designate Investment Advisory Committee will meet at least once every quarter to review the portfolio in terms of security, type, risk and investment return. The Fiscal Officer shall be responsible for maintaining records of all investments and deposits and preparing reports that summarize recent market conditions, economic conditions, economic developments and anticipated investments for Council.
Pursuant to Ohio R.C. Chapter 135, all entities conducting business and all brokers, dealers and financial institutions initiating transactions with the Village by giving advice, by making investment policy or by executing transactions initiated by the Village, must acknowledge their agreement to abide by this investment policy's content.
(k) This section shall be retroactive to January 1, 1998.
(Ord. 1088-98. Passed 12-22-98; Ord. 1420-12. Passed 10-30-12.)