Certificates of deposit, Demand deposits and Non-demand savings accounts shall be secured by each Depository by the pledge with a Custodian of Eligible Collateral in an amount equal to at least one hundred percent (100%) of the aggregate amount of Certificates of deposit or of Demand deposits and Non-demand savings accounts on deposit with that Depository, in excess of the amount insured by the Federal Deposit Insurance Corporation. The Director of Finance shall receive an identification of Eligible Collateral from each Depository as of the end of each calendar quarter and shall review the identification to determine compliance with this Section. A Depository may comply with this section by meeting the requirements of Specific Collateral set forth in subsection (a) hereof or of Pooled Collateral set forth in subsection (b) hereof.
(a) Specific Collateral.
(1) At the time of deposit of the Eligible Collateral and at the end of each calendar month, the Depository shall determine the fair market value of the Eligible Collateral pledged. If the fair market value of the Eligible Collateral is determined to be less than that required by this section, the Depository shall correct this imbalance by pledging additional Eligible Collateral by the fifth business day of the following month.
(2) Within thirty days of the end of each calendar quarter, each Depository shall provide the Director of Finance with a detailed statement of the face and market values of all Eligible Collateral as of the end of that calendar quarter.
(3) In the event that the Depository shall fail to pay over to the City the proceeds of any Authorized Investment or non-interest bearing Demand deposit when due, the Treasurer shall, pursuant to Section 192.20 of the Toledo Municipal Code, notify the Custodian of the Eligible Collateral for such Authorized Investment or non-interest bearing Demand deposit. Upon notification, the Custodian shall make available the Eligible Collateral for proceedings pursuant to subsection (c) hereof.
(b) Pooled Collateral.
(1) A Depository may provide Eligible Collateral for Certificates of deposit, Demand deposits and Non-demand savings accounts which are also pledged as security for deposits of public funds of other political entities held by that Depository.
(2) The Eligible Collateral pledged by the Depository may collateralize the deposits of other political entities even though those entities have made such deposits under different legal authority than the City. Pooled Collateral is subject to the following limitations and conditions:
A. Securities committed to the pool must have a fair market value of at least one hundred percent (100%) of all public moneys to be secured by the pool in excess of the amount of such public money insured by the Federal Deposit Insurance Corporation.
B. Eligible Collateral constituting the pool shall be delivered to a Custodian. Fees and expenses of the Custodian shall be paid by the Depository.
C. The Depository shall provide the Director of Finance, as of the end of each calendar quarter, a detailed statement of the face and market values of all Eligible Collateral pledged to the pool within thirty days of the end of each calendar quarter. This quarterly statement shall also disclose the total amount of funds of political entities then secured by the pool and the amount thereof insured by the Federal Deposit Insurance Corporation.
D. At the end of each calendar month, the Depository shall determine the fair market value of all Eligible Collateral and compare the total market value to the total of deposits of political entities then held by the Depository. If the fair market value of the Eligible Collateral plus the amount of such deposits insured by the Federal Deposit Insurance Corporation is determined to be less than the amount of deposits of political entities then held, the Depository shall correct this imbalance by the pledging of additional Eligible Collateral by the fifth business day of the following month.
E. The City acknowledges that other political entities whose deposits or investments are secured in a pool of Eligible Collateral may be governed by provisions of Ohio R.C. Chapter 135. Therefore, in the event that a Depository shall fail to pay over to the City any Demand deposit or money due from a Certificate of deposit or Non-demand savings account, proceedings shall then be taken in accordance with subsection (c) hereof.
F. Failure of the Depository to abide by any of the provisions of this section shall cause that institution to immediately cease being a Depository and the Commissioner of Taxation and Treasury shall withdraw as promptly as possible all non-interest bearing Demand deposits and Non-demand savings accounts and remove the institution from the list of Depositories maintained pursuant to Section 192.16 of the Toledo Municipal Code.
(c) In the event a Depository shall fail to pay to the City when due (or, in the case of a Demand deposit, on demand) the proceed of a Certificate of deposit or the amount on deposit in a Demand deposit or Non-demand savings account, the Director of Finance shall:
(1) In the case of Specific Collateral as provided in subsection (a) hereof, following the procedures set forth in Ohio R.C. 135.18, cause the Eligible Collateral provided by the Depository to secure the payment of the Certificate of deposit or repayment of the Demand deposit or the Non-demand savings account to be sold and the proceeds of such sale to be distributed as provided in Ohio R.C. 135.18; and
(2) In the case of Pooled Collateral as provided in subsection (b) hereof, cause all or part of the Pooled Collateral provided by the Depository to secure the payment of the Certificate of deposit or repayment of the Demand deposit or the Non-demand savings account to be sold and the proceeds of such sale to be distributed as provided in Ohio R.C. 135.18(I).
Alternatively, in the case of either Specific Collateral or Pooled Collateral, the Director of Finance, following consultation with the Mayor and the Director of Law, and determination that such is in the best interest of the City, may follow the procedure set forth in Ohio R.C. Chapter 1309 and cause the Specific Collateral or Pooled Collateral provided by the Depository as security for the payment of such Certificate of deposit or repayment of the Demand deposit or Non-demand savings account to be sold and the proceeds of such sale to be applied as provided in Ohio R.C. Chapter 1309. The Director of Law shall assist the Director of Finance in realizing upon the security provided for the repayment of a Demand deposit or Non-demand savings account, or the payment of a Certificate of deposit, including without limitation the filing of litigation seeking foreclosure, injunctive relief or declaratory judgement.
(Ord. 1061-90. Passed 10-23-90; Ord. 178-94. Passed 4-18-94.)