The funds of the city available for investment shall be invested in accordance with this policy and all applicable state statutes only in the following types of investments instruments:
(A) Authorized investment instruments.
(1) Obligations of the United States and of its agencies and instrumentalities, including obligations subject to repurchase agreements, provided that delivery of these obligations subject to repurchase agreements is taken either directly or through an authorized custodian.
(2) Obligations and contracts for future delivery or purchase of obligations backed by the full faith and credit of the United States or a United States government agency, including but not limited to:
(a) United States Treasury;
(b) Export-Import Bank of the United States;
(c) Farmers Home Administration;
(d) Government National Mortgage Corporation; and
(e) Merchant Marine bonds.
(3) Obligations of any corporation of the United States government, including but not limited to:
(a) Federal Home Loan Mortgage Corporation;
(b) Federal Farm Credit Banks;
(c) Bank for Cooperatives;
(d) Federal Intermediate Credit Banks;
(e) Federal Land Banks;
(f) Federal Home Loan Banks;
(g) Federal National Mortgage Association; and
(h) Tennessee Valley Authority.
(4) Certificates of deposit issued by or other interest-bearing accounts of any bank or savings and loan institution which are insured by the Federal Deposit Insurance Corporation or similar entity or which are collateralized, to the extent uninsured, by any obligations permitted by section 41.240(4) of the Kentucky Revised Statutes.
(5) Uncollateralized certificates of deposit issued by any bank or savings and loan institution rated in one of the three highest categories by a nationally recognized rating agency.
(6) Bankers’ acceptances for banks rated in one of the three highest categories by a nationally recognized rating agency.
(7) Commercial paper rated in the highest category by a nationally recognized rating agency.
(8) Bonds or certificates of indebtedness of the Commonwealth of Kentucky and of its agencies and instrumentalities.
(9) Securities issued by a state or local government, or any instrumentality or agency thereof, in the United States, and rated in one of the three highest categories by a nationally recognized rating agency.
(10) Shares of mutual funds, each of which shall have the following characteristics:
(a) The mutual fund shall be an open-end diversified investment company registered under the Federal Investment Company Act of 1940, as amended.
(b) The management company of the investment company shall have been in operation for at least five years.
(c) All of the securities in the mutual fund shall be eligible investments under this section.
(B) Limitations on investment transactions. With regard to the investments authorized in this section, the following limitations shall apply:
(1) The amount of the city’s funds invested at any one time in the categories of investments authorized in subsections A(5), A(6), A(7), and A(9) of this section shall not exceed 20% of the total amount of funds invested on behalf of the city.
(2) No investment shall be purchased for the city on a margin basis or through the use of any similar leveraging technique.
(Mun. Order 2015-13, passed 12-7-15)