12-R-75 Adoption of the City Investment PolicyRESOLUTION NO. 12-R-75
A RESOLUTION BY THE CITY COUNCIL OF THE CITY OF SCHERTZ,
TEXAS AUTHORIZING ADOPTION OF THE CITY OF SCHERTZ
INVESTMENT POLICY.
WHEREAS, the C~ of Schertz Investment Policy requires an annual review by the City Council
(the "City Council") and after such review the City of Schertz (the "City") has determiued that it is in the
best interest of the City to adopt the City of Schertz Investment Policy, now, therefore,
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SCHERTZ, TEXAS THAT:
Section 1. The City Council hereby adopts the City of Schettz Investment Policy and is
repealing any and all prior changes and amendments to Investment Policy attached as Exhibit A.
Section 2. The City of Schettz Investment Policy requires an amoral review by [he City
Council and after review the City Council recommends changing
Section 3. Section N, subsection Investment Advisory Committee to read as follows: An
Investment Advisory Committee composed of the City Manager (as Chair), Executive Directors, the
Mayor, Chief of Staff, Finance Director, Assistant Finance Director, Budget/Financial Analyst, and one
member of the City Council".
Section 4. All resolutions, or pmts thereof, which are in conflict or inconsistent with any
provision of this Resolution are hereby repealed to the extent of such conflict, and the provisions of this
Resolution shall be and remain conttolling as to the matters resolved herein.
Section 5. This Resolution shall be conshued and enforced in accordance with the laws of
the State of Texas and the United States of America.
Section 6. If any provision of this Resolution or the application thereof to any person or
circnmstance shall be held to be invalid, the remainder of this Resolution and the application of such
provision to other persons and circumstances shall nevertheless be valid, and the City Council hereby
declares that this Resolution would have been enacted without such invalid provision.
Section 7. It is officially found, determined, and declared that the meeting at which this
Resolution is adopted was open to the public and public notice of the time, place, and subject matter of
the public business to be considered at such meeting, including this Resolution, was given, all as required
by Chapter 551, Texas Government Code, as amended.
Section 8. This Resolution shall be in force and effect from and after its final passage, and it
is so resolved.
PASSED AND ADOPTED, this 4th day of September, 2012.
CIT F R Z, TEXAS
May ro-Tem, George Antuna
ATTEST:
Brenda Dennis, TRl~IC, MMC, CPM City Secretary
(CITY SEAL)
EXHIBIT A
CITY OF SC]3ERTZ, TEXAS INVESTMENT POLICY
See attached
A-1
CITY OF SCHERTZ, TEXAS
INVESTMENT POLICY
TABLE OF CONTENTS
I. INVESTMENT SCOPE ....................................................................................... .................... I
General Statement ........................................................................................ .................... 1
Finds Included .............................................................................................. .................... 1
Funds Excluded ............................................................................................. .................... 1
II. INVESTMENT OBJECTIVES ......................................................................... .................... 1
General Statement ........................................................................................ .................... 1
Safety ......................:....................................................................................... .................... 2
Liquidity ......................................................................................................... ....:............... 2
Diversification ............................................................................................... .................... 2
Yield ............................................................................................................... .................... 2
Maturity .......................................................................................................... ................... 3
Quality And Capability of Investment Management ................................. ................... 3
Public Trust .................................................................................................... ................... 4
Portfolio Management ................................................................................... ................... 4
Investment Strategy ....................................................................................... ................... 4
III. INVESTMENT RESPONSIBILITY AND CONTROL ................................. ................... 4
City's Investment Delegate ............................................................................ ................... 4
Selecting And Processing Investments ......................................................... ................... S
Documenting Investments And Providing Details ...................................... ................... S
Developing Cash Flow Projections For All Portfolios ................................ ................... S
Determining Cash Available For Investment .............................................. ................... S
Monitoring Investment Performance ........................................................... ................... 5
Reconciling Investment Records And General Ledger .............................. ................... 6
Allocating Interest Revenue .......................................................................... ................... 6
Providing Revenue Estimates For All Portfolios ........................................ ................... 6
Prudence ......................................................................................................... ................... 6
Business Relationships of City Manager (or his/her designee) .................. ................... 7
Liability of City Manager (or his/her designee) .......................................... ................... 7
IV. INVESTMENT REPORTING ........................................................... .................................. 7
Quarterly Report ............................................................................ .................................. 7
Investment Advisory Committee ................................................... .................................. 8
Annual Review ................................................................................ .................................. 8
Notification of Investment Changes or Defaults .......................... .................................. 9
Compliance Audit ........................................................................... .................................. 9
V. INVESTMENT INSTRUMENTS ................................................. ........................................ 9
Authorized Investment Instruments ....................................... ........................................ 9
VI. INVESTMENT INSTITUTIONS ................................................. ...................................... 12
Investment Institutions Defined ............................................... ...................................... 12
Selection of Bank And Securities Dealers ............................... ...................................... 12
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VII. INVESTMENT COLLATERAI. AND SAFEKEEPING .......
Collateral or Insurance For Deposits ....................................
Safekeeping ...............
Delivery vs. Payment
.................. 13
.................. 13
.................. 14
.................. 14
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I. INVESTMENT SCOPE
General Statement
This policy (this "Policy") serves to satisfy the statutory requirement of the Public Funds
Investment Act, as amended, Texas Government Code Chapter 2256, as amended (the "Act"), to
define and adopt a formal written investment policy for the City of Schertz, Texas (the "City").
The City shall be authorized to invest its funds pursuant to the provisions of the Act and this
Policy or, upon obtaining the prior approval of the City Council of the City (the "City Council"),
any other applicable law.
Funds Included
This Policy applies to all City funds under the direct control of the City, at the present
time any funds to be received in the future and any other funds held in custody by the City,
unless expressly prohibited by law or unless it is in conri~avention of any depository contract
between the City and any depository bank.
The City funds that are entrusted to the City Council for investment pursuant to this
Policy are divided into the following portfolios based on the source of funds:
The operating account portfolio that consists of funds from the general fund and
all other miscellaneous funds.
The agency funds portfolio, which consists of all agency funds.
Special Revenue, Special Assessment, and all other City funds.
Funds Excluded
This Policy shall not be applicable to any funds on deposit in any bond account, reserve
account, or capital improvement construction account. The provisions of the ordinances
authorizing the issuance of these debt obligations and the provisions of the Internal Revenue
Code of 1986, as amended control the investment of funds on deposit in these accounts.
II. INVESTMENT OBJECTIVES
General Statement
Funds of the City will be invested in accordance with the Act, this Policy, written
investment strategy, and written administrative procedures to be developed by the City Manager
(or his/her designee). The City's investment portfolio shall be managed in a manner to attain the
maximum rate of return allowed tluough prudent and legal investing of City funds while
preserving and protecting capital in the overall portfolio.
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Safety
The primary objective of the City for all portfolios and funds is to ensure the safety of the
principal. All investment transactions shall first seek to avoid capital losses.
Liquidity
The City's investment portfolio must be structured in a manner that will provide the
liquidity necessary to meet all operating requirements which might reasonably be anticipated,
and to pay obligations as they become due.
Diversification
The policy of the City, except when investing with the City's depository bank or in U.S.
Treasury Bills, Bonds or Notes, will be to diversify its investment portfolio when investing in
certificates of deposit of other banks and savings and loans domiciled in Texas, repurchase
agreements, U.S. agencies securities, and other investment instruments provided for by law. The
City's portfolio shall be diversified to eliminate the risk of loss resulting from over concentration
of assets in a specific maturity, a specific issuer or a specific class of investments. Investments
of the City shall always be selected to provide stability of income and reasonable liquidity.
Liquidity is defined as the ability to sell an investment at reasonable cost under adverse market
conditions.
In establishing specific diversification strategies, the following general polices and
constraints shall apply:
(1) Portfolio maturities shall be staggered in a way that avoids undue concentration of
assets in a specific maturity sector. Maturities shall be selected which provide for
stability of income and reasonable liquidity.
(2) Liquidity shall be maintained through practices that ensure that the next
disbursement date and payroll date are covered through current revenues,
maturing investments, or marketable securities.
(3) Risks of market price volatility shall be controlled through maturity
diversification.
Yield
It is the objective of the City to earn the maximum rate of retwn allowed on its
investments within the constraints imposed by its safety and liquidity objectives, and the
applicable law governing the investment of public funds.
The City must invest its portfolios in eligible investments that yield the highest possible
rate of return while providing the necessary protection of the principal. The City seeks to
optimize return on investments in all portfolios. The average minimum rate of return for the
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entire portfolio, excluding funds needed for current obligations, must be at least equal to a no
default risk rate of return indicator, such as the return on the three-month Treasury bill. If funds
are subject to yield restrictions due to federal arbitrage regulations, those funds are excluded
fiom the yield calculation. The City may only invest in a particular eligible investment if its
yields are equal to or greater than the bond equivalent yield on United States Treasury
obligations of comparable maturity. The City Council may establish additional appropriate
criteria for investment performance measures,
Maturity
Portfolio maturities will be staggered to achieve the highest return of interest but at the
same time provide for the necessary liquidity to meet the City's cash needs.
City funds shall be invested only in investments whose maturities do not exceed five
years at the time of purchase, except, if permissible, funds accumulated for debt service
payments, bond fund reserve accounts, and registry trust funds. In addition, the average maturity
of the overall portfolio, excluding those investments held for fuhue major capital expenditures
and registry trust funds, shall not exceed 4.5 years.
Quality and Capability of Investment Management
It is the City's policy to provide for periodic training in investments as required by the
Act for the City Manager tluough courses and seminars offered by professional organizations
and associations in order to ensure the quality and capability of the City Manager (or his/her
designee) in making investment decisions. The treasurer, the chief financial officer if the
treasurer is not the chief financial officer, and the City Manager (or his/her designee) of the City
shall:
(1) attend at least one training session fiom an independent source approved by the
City Council of the City or the Investment Advisory Committee advising the City
Manager (or his/her designee) as provided for in the Policy of the City and
containing at least 10 hours of inshuction relating to the treasurer's or officer's
responsibilities under this Policy within 12 months after taking office or assuming
duties; and
(2) attend an investment training session not less than once in a two-year period and
receive not less than 10 hours of instruction relating to investment responsibilities
under this Policy fiom an independent source approved by the City Council of the
City or the Investment Advisory Committee advising the City Manager (or his/her
designee) as provided for in the Policy of the City.
Training under this Policy must include education in investment controls, security risks,
strategy risks, market risks, diversification of investment portfolio, and compliance with the Act.
Public Trust
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It will be the objective of the City to act responsibly as custodians of the public trust.
Portfolio Management
Under this Policy all investments will be made with the intent of pursuing, at the time of
purchase, the best rate of rehun on securities held until maturity, and not with the intent of
speculative trading. However, securities may be sold before maturity if market conditions
present an opportunity for the City to benefit from this transaction.
Investment Strategy
As a part of its Policy, the City shall adopt a separate written investment strategy for each
of the funds or groups of funds under its control. Each investment strategy must describe the
investment objectives for the particular fund using the following priorities in order of
importance:
(1) Understanding of the suitability of the investment to the financial requirements of
the City;
(2) Preservation and safety of principal;
(3) Liquidity;
(4) Marketability of the investment if the need arises to liquidate the investment
before maturity;
(5) Diversification of the investment portfolio; and
(6) Yield.
III. INVESTMENT RESPONSIBILITY AND CONTROL
City's Investment Delegate
In accordance with Section 2256.005 of the Act, the City Manager (or his/her designee) is
designated as the officer responsible for the investment of the City's funds. The City Manager
(or his/her designee) is the primary manager of City investment portfolios, and shall develop and
maintain written adminisriative procedures for the operation of the investment program,
consistent with this Policy, including the following:
(1) Summarizing the economic and market analysis;
(2) Forecasting available cash for investments;
(3) Formulating strategies for asset mix, investment instruments, maturities, and
target yields;
(4) Monitoring performance against the current investment strategy and evaluating
reasons for variances;
(5) Reporting portfolios performance for the previous quarter to the City Council; and
(6) Revising the investment strategy based on recommendations by the Investment
Advisory Committee.
Selecting and Processing Investments
The City Manager (or his/her designee) reviews the composition of the current portfolio
and determines whether the securities under consideration maintain the portfolio within the_
guidelines established by this Policy, subchapter A of the Act, and all federal, state, and local
statutes, rules or regulations. The City Manager (or his/her designee) approves the wire transfer
form authorizing the transfer of funds for a specific investment transaction.
Documenting Investments and Providing Details
The City Manager (or his/her designee) retains documentation of all investment
transactions, including any bond swaps. The City Manager (or his/her designee) provides
information and supporting documentation for all investment transactions for entry in the
General Ledger. The City Manager (or his/her designee) will utilize information and back-up
documentation on all investment transactions to ensure accwate calculation of cash position and
accurate posting to appropriate accounts.
Developing Cash Flow Projections for All Portfolios
The City Manager (or his/her designee) analyzes prior period data and develops and
amends cash flow projections of the City's cash requirements. The City Manager (or his/her
designee) uses cash flow projections to match assets and liabilities in order to maximize the
return on investments.
Determining Cash Available for Investment
The City Manager (or his/her designee) determines the amount of City funds available for
investment each business day. All funds that can be legally invested and that are not required for
that day's disbursements are considered funds available for investment.
Monitoring Investment Performance
The City Manager (or his/her designee) must routinely perform market and economic
analysis to forecast probable market conditions for the investment period by assembling and
analyzing current and wend data to develop and plan investment sU•ategy. This analysis uses
information obtained from investment advisors, brokers, and investment industry publications.
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The City Manager (or hislher designee) monitors the current and expected yield curves
for interest rate movements. When interest rates are expected to decline, maturity ranges are
extended within portfolio and the constraints of this Policy. When interest rates are expected to
increase, maturity ranges are shortened. The City Manager (or his/her designee) monitors yield
spreads between various government agency issues and United States notes and bonds to
determine the best value. The City Manager (or his/her designee) summarizes economic and
market trend information and presents recommendations for investments strategy based on
economic and market conditions to the City Council and the Investment Advisory Committee.
Reconciling Investment Records and General Ledger
The City Manager (or his/her designee) prepares a monthly report that includes
information such as identifying investments at par value, identifying CUSIP number, disclosing
the premium or discount, and the interest purchased for the City's investments. The report
includes monthly and year-to-date interest accruals and amortization accretion of
premium/discount. This report should reconcile to the investment accounts in the General
Ledger.
Allocating Interest Revenue
The City Manager (or his/her designee) allocates the interest revenue earned fi•om
investments proportionately to all accounts that participate in the investment function.
Providing Revenue Estimates for All Portfolios
The City Manager (or hislher designee) provides an estimate of the investment revenue
for the annual budget by August 1 of each year.
Prudence
Investments of the City shall be made with judgment and the exercise of due care, under
prevailing circumstances, that a person of prudence, discretion and intelligence would exercise in
the management of the person's own affairs, not for speculation, but for investment, considering
the probable safety of capital, as well as the probable income to be derived for• the City. Unless
authorized by law, a person may not deposit, withdraw, transfer, or manage in any other manner
the funds of the City.
Business Relationships of City Manager (or his/her designee)
The City Manager (or his/her designee) must file a statement with the City Council and
the Texas Ethics Commission of any personal business relationship that the City Manager (or
his/her designee) may have with a business organization as defined in the Act offering to engage
in an investment transaction with the City. A personal business relationship is defined by
Section 2256.005 of the Act to exist if
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(1) The investment officer owns 10% or more of the voting stock or shares of
the business organization or owns $5,000 or more of the fair market value
of the business organization;
(2) Funds received by the investment officer from the business organization
exceed 10% of the investment officer's gross income for the previous year;
or
(3) The investment officer has acquired from the business organization during
the previous year investments with a book value of $2,500 or more for the
personal account of the investment officer.
Liability of City Manager (or his/her designee)
The City Manager (or his/her designee) is not responsible for any loss of the City funds
tluough the failure or negligence of a depository bank or other financial or investment institution
as described in Article VI of this Policy.
IV. INVESTMENT REPORTING
Quarterly Report
The City Manager (or• his/her designee) will continually monitor and evaluate the City's
investments, and report quarterly to the City Council as provided in Section 2256.023 of the Act.
The report must:
(1) describe in detail the investment position of the City on the date of the report;
(2) be prepared jointly by all investment officers of the City;
(3) be signed by each investment officer of the City;
(4) contain a summary statement, prepared in compliance with generally accepted
accounting principles, of each pooled fund group that states the:
(a) beginning market value for the reporting period;
(b) additions and changes to the market value during the period;
(c) ending market value for the period; and
(d) fully accrued interest for the reporting period;
(5) state the book value and market value of each separately invested asset at the
beginning and end of the reporting period by the type of asset and fund type
invested;
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(6) state the maturity date of each separately invested asset that has a maturity date;
(7) state the account or fund or pooled group fund in the City for which each
individual investment was acquired; and
(8) state the compliance of the investment portfolio of the City as it relates to:
(a) the investment strategy expressed in the City's investment policy; and
(b) relevant provisions of the Act.
The report shall be presented not less than quarterly to the City Council and the City
Manager of the City within a reasonable time after the end of the period.
If the City invests in other than money market mutual funds, investment pools or
accounts offered by its depository bank in the form of certificates of deposit, or money market
accounts or similar accounts, the reports prepared by the investment officers under this section
shall be formally reviewed at least annually by an independent auditor, and the result of the
review shall be reported to the City Council by that auditor.
Investment Advisory Committee
An Investment Advisory Committee composed of the City Manager (as Chair), Executive
Directors, the Mayor, Chief of Staff, Finance Director, Assistant Finance Director,
BudgetlFinancial Analyst, and one member of the City Council will meet no less than once
semiannually to review the last two quarterly reports prepared by the City Manager (or his/her
designee) and review the Investment Objectives, Investment Responsibility and Control, and
Investment Instruments as established by this Policy and the Act.
Annual Review
This Policy and investment staategy will be reviewed by City Council annually. The City
Council shall adopt a written rule, order, ordinance, or• resolution stating that it has reviewed the
Policy and investment strategy and shall record in the order, ordinance or resolution any changes
made to either the Policy or investment strategy.
Notification of Investment Changes or Defaults
It shall be the duty of the City Manager (or his/her designee) to notify the City Council of
any significant changes in current investment methods and procedures prior to their
implementation and to immediately notify the City Council in the event of a default or
nonpayment of any investment acquired with City funds. In addition, the City Council in its
annual review of the Policy shall adopt any order, ordinance, or resolution establishing its annual
review and record any changes to the Policy or investment strategies.
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Compliance Audit
The City, in conjunction with its annual financial audit, shall perform a compliance audit
of management controls on investments and adherence to the Policy.
V. INVESTMENT INSTRUMENTS
Authorized Investment Instruments
The City Manager (or his/her designee) shall use any or all of the following authorized
investment instruments consistent with governing law:
(1) Obligations, including letters of credit, of the United States or its agencies
and instrumentalities;
(2) Direct obligations of the State of Texas or its agencies and
inshvmentalities;
(3) Collateralized mortgage obligations directly issued by a federal agency or
instrumentality of the United States, the underlying security for which is
guaranteed by an agency of instt•umentality of the United States;
(4) Other obligations, the principal of and interest of which are
unconditionally guaranteed or insured by, or backed by the full faith and
credit of the State of Texas or the United States or their respective
agencies and instrumentalities;
(5) Obligations of states, agencies, counties, cities, and other political
subdivisions of any state having been rated as to investment quality by a
nationally recognized investment rating fum and having received a rating
of not less than A or its equivalent;
(6) Certificates of deposit. issued by a state or national bank domiciled in this
State, a savings bank domiciled in this State or a state or federal credit
union domiciled in this State that are
(A) Guaranteed or insured by the Federal Deposit Insurance
Corporation or its successor or the National Credit Union Share
Insurance Fund or its successor; or
(B) Secured by obligations that are described by subdivisions (1)-(6) of
this subsection, including mortgage-backed securities directly
issued by a federal agency or instrumentality that have a market
value of not less than the principal amount of the certificates or• in
any other manner and amount provided by law for deposits of the
City; or
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(C) Secured in any other manner and amount provided by law for
deposits of the City;
(7) Prime domestic bankers' acceptances if it
(A) Has stated maturity of 270 days or fewer from the date of its
issuance;
(B) Will be, in accordance with its terms, liquidated in full at maturity;
(C) Is eligible for collateral for borrowing fi•om a Federal Reserve
Bank; and
(D) Is accepted by a bank organized and existing under the laws of the
United States or any state, if the short-term obligations of the bank,
or of a bank holding company of which the bank is the largest
subsidiary, are rated not less than A-1 or P-1 or• an equivalent
rating by at least one nationally recognized credit rating agency;
(8) Commercial paper if it
(A) Has a stated maturity of 270 days or less from the date of its
issuance; and
(B) Is rated not less than A-1, P-1, or the equivalent by at least
(1) Two nationally recognized credit rating agencies; or
(2) One nationally recognized credit rating agency and is fully
secured by an irrevocable letter of credit issued by a bank
organized and existing under the laws of the United States
or• any state thereof;
(9) Fully collateralized direct repurchase agreements having a defined
termination date, secured by obligations described by subdivision (1) of
this subsection, pledged to the City, held in the City's name, and deposited
at the time the investment is made with a third party selected and approved
by the City, and placed tluough a primary government securities dealer, as
defined by the Federal Reserve, or a financial institution doing business in
this State;
(10) A guaranteed investment contract is an authorized investment for bond
proceeds under the Act if the guaranteed investment conhact
(A) Has a defined termination date;
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(B) Is secured by obligations described by subdivision (1) in an
amount at least equal to the amount of bond proceeds invested
under the contract; and
(C) Is pledged to the City and deposited with the City or with a third
party selected and approved by the City; and
(11) Bond proceeds, other than bond proceeds representing reserves and funds
maintained for debt service purposes, may not be invested under the Act in
a guaranteed investment contract with a term of longer than five years
from date of issuance of the bonds; to be eligible as an authorized
investment
(A) The City Council must specifically authorize guaranteed
investment contracts as an eligible investment in the ordinance or
resolution authorizing the issuance of bonds;
(B) The City must receive bids from at least tluee separate providers
with no material fmancial interest in the bonds from which
proceeds were received;
(C) The City must purchase the highest yielding guaranteed investment
contract for which a qualifying bid is received;
(D) The price of the guaranteed investment contract must take into
account the reasonably expected drawdown schedule for the bond
proceeds to be invested; and
(E) The provider must certify the administrative costs reasonably
expected to be paid to third parties in connection with the
guaranteed investment contract.
In addition to the investments described by items (1) - (11) above, the City may invest
funds under its control in eligible public funds investment pools as permitted under the Act. A
public funds investment pool must be continuously rated no lower than AAA or AAA-m or at an
equivalent rating by at least one nationally recognized rating service or no lower than investment
grade by at least one nationally recognized rating service with a weighted average maturity no
greater than 90 days.
In addition to the investments described by items (1) - (11) above, the City may, in
accordance with the Act, purchase, sell, and invest funds, after receiving a prospectus and other
information required by the SEC, under its control in anSEC-regulated, no-load money market
mutual fund with adollar-weighted average stated maturity of 90 days or less and whose
investment objectives include seeking to maintain a stable net asset value of $1 per share or a no-
load mutual fund which is registered with the SEC, has an average weighted matruity of less than
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two years, is invested exclusively in obligations approved by the Act, is continuously rated as
investment quality by at least one nationally recognized investment rating firm of not less than
AAA or its equivalent and conforms to the requirements set forth in Sections 2256.016(b) and (c)
of the Act relating to the eligibility of investment pools to receive and invest funds of the City.
The City shall not (i) invest in the aggregate more than 15% of its monthly average fund balance,
excluding bond proceeds and reserves and other funds held for debt service in mutual funds as
described by the Act; (ii) invest any portion of bond proceeds, reserves and funds held for debt
service, in mutual finds described by the Act; or (iii) invest its funds or funds under its control,
including bond proceeds and reserves and other funds held for debt service in any one mutual
fund described by the Act in an amount that exceeds 10% of the total assets of the mutual fund.
VI. INVESTMENT INSTITUTIONS
Investment Institutions Defined
The City Manager (or his/her designee) shall invest City funds with any or all of the
following institutions or groups consistent with federal and state law and the current depository
bank contract:
(1) The City's Depository bank;
(2) Other state or national banks domiciled in Texas that are insured by FDIC;
(3) Savings and loan associations domiciled in Texas that are insured by
FDIC;
(a) Public funds investment pool; or
(5) Government securities brokers and dealers acceptable to the City.
Selection of Bank and Securities Dealers
All financial institutions and broker/dealers who desire to become qualified bidders for
investment transactions must be given a copy of the Policy and must supply the City Manager (or
hisllrer designee) with the information specified below. First, abroker/dealer must submit
audited financial statements for the financial institution or broker/dealer. Second, abroker/dealer
must provide evidence of appropriate registration by the qualified representative of the business
organization as such terms are defined in the Act. For bank dealers, this requires a statement
from a senior bank official that the bank dealer is appropriately registered with its primary
regulatory agency (the Office of the Comptroller of the Currency for National Banks) as a
government securities dealer, municipal securities dealer, or both. For a securities firm, this
requires a statement from a senior official that the firm is registered with the National
Association of Securities Dealers. Third, a broker/dealer must provide a completed
Broker/Dealer questionnaire furnished by the City Manager (or his/her designee). Finally, a
broker/dealer must deliver a written statement, acceptable to the City, by the qualified
representative, offering to engage in an investment transaction with the City, that they have
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received and thoroughly reviewed the Policy and acknowledged that the business organization
has implemented reasonable procedures and controls in an effort to preclude investment
transactions conducted between the City and the business organization that are not authorized by
this Policy and other investment policies, except to the extent that this authorization is dependent
on an analysis of the makeup of the City's entire portfolio or requires an interpretation of
subjective investment standards. The City Manager (or his/her designee) will recommend both
primary and secondary securities dealers to the City Council for final approval. The City
Manager (or his/her designee) may not acquire or• otherwise obtain any authorized investment
described in this Policy from a person who has not delivered to the City the written statement
required in this section.
The City Council or the designated Investment Advisory Committee member shall, at
least annually, review, revise, and adopt a list of qualified brokers that are authorized to engage
in investment transactions with the City.
VII. INVESTMENT COLLATERAL AND SAFEKEEPING
Collateral or Insurance for Deposits
The City Manager (or his/her designee) shall ensure that all deposited and invested City
funds are, to the extent required, fully collateralized or•insured consistent with federal and state
law and the current bank depository contract in one or more of the following manners:
(1) FDIC insurance coverage;
(2) Obligations of the United States or its agencies and instrumentalities;
(3) Direct obligations of the State of Texas or its agencies;
(4) Other obligations, the principal of and interest on which axe
unconditionally guaranteed or insured by the State of Texas or the United
States or its agencies and instrumentalities; or
(5) Any other manner allowed by law.
Safekeeping
All purchased securities shall be held in safekeeping by the City, or a City account in a
third parry financial institution, or with a Federal Reserve Bank.
All certificates of deposit, insured by FDIC, purchased outside the depository bank shall
be held in safekeeping by either the City or a City account in a third party financial institution.
All pledged securities by the depository bank shall be held in safekeeping by the City, or
a City account in a third party financial institution, or with a Federal Reserve Bank.
13
All certificates of deposit, pledged by the depository bank shall be held in custody of a
Federal Reserve Bank for safekeeping, be the subject of a valid pledge agreement designating the
City as the beneficiary of the pledge agreement; be insured by the FDIC; be described in detail
by a safekeeping receipt issued to the City by the Federal Reserve Bank having custody of the
certificates; and be issued with the City as registered owner.
Delivery vs. Payment
It will be the policy of the City that all transactions, except investment pool funds and
mutual funds, shall be purchased using the delivery vs. payment method tluough the Federal
Reserve System. By so doing, City funds are not released until the City has received, through
the Federal Reserve wire, the securities purchased.
Adopted: April, 2002
Reviewed: May 20, 2003 and adopted
Apri128, 2004
March 9, 2005 and adopted
Oct 17, 2006 and adopted
Oct 23, 2007 and adopted
May 19, 2009 and adopted
September 7, 2010 and adopted
October 18, 2011 and adopted
14
FORM-DO NOT REVISE
NOTICE OF CONFIDENTIALITY RIGHTS: IF YOU ARE A NATURAL PERSON,
YOU MAY REMOVE OR STRIKE ANY OR ALL OF THE I'OLLOWING
INFORMATION FROM ANY INSTRUMENT THAT TRANSFERS AN INTEREST IN
REAL PROPERTY BEFORE IT IS FILED FOR RECORD IN THE PUBLIC RECORDS:
YOUR SOCIAL SECURITY NUMBER OR YOUR DRIVER'S LICENSE NUMBER,
WATERLINE EASEMENT AND
TEMPORARY CONSTRUCTION EASEMENT AGREEMENT
THE STATE OF TEXAS
COUNTY OF GUADALUPE
KNOW ALL PERSONS BY THESE PRESENTS:
THAT _OGVP, LTD_, a Texas limited nartnershi~p (tire "Grantor"), for and in
consideration of the sum of Ten and No/100 Dollars ($10.00) and other good and valuable
consideration to the Grantor paid by the CITY OF SCHERTZ, a Texas municipal corporation
(the "Grantee"), the receipt and sufficiency of which are hereby acknowledged, has GRANTED,
SOLD, and CONVEYED and by these presents does GRANT, SELL, and CONVEY unto the
Grantee, its successmrs and assigns, subject to the terms hereof, (]) a permanent exclusive
easement and right-of--way upon, across, and beneath real property located in Guadalune
County, Texas, as more particularly described in Exhibit A attached hereto and incorporated
herein for all purposes (the "Permanent Easement"), and being a 0.]332 -acre portion of that
3.196 -acre tract of land of the Grantor more particularly described in that insh•ument
recorded in Volume 8 ,Page 13 of the Official Public Records of Guadalune County,
Texas (the "Premises"), and (2) a temporary non-exclusive construction easement and right-of-
way upon and across a 0.2745 -acre portion of the Premises, as more particularly described on
Exhibit B attached hereto and incorporated herein for all purposes (the "Construction Easement")
(collectively, the "Easements"). Tho Permanent Easement is granted for the purpose of
constructing, operating, maintainiog, and repairing a waterline (the "Waterline"). The
Construction Easement is granted for the purpose of facilitating the construction of the
Waterline.
The Easements herein granted are subject to the following terms, agreements,
reservations, conditions, covenants, limitations, and exceptions:
(1) The Permanent Easement herein granted shall be located across a ]0-foot wide
sU•ip of land and shall be perpetual until the earlier to occur of (a) the permanent
and affirmative abandonment of the use of the Permanent Easement by the
Grantee, its successors or assigns, or (ti)the execution and recordation in the
Official Public Records of Guadalune County, Texas, of an instrument by
which the Grantee, or its successors or assigns, as applicable, abandons and
releases the Permanent Easement.
(2) The Construction Easement herein granted shall be located across a 20-foot wide
strip of land adjacent and parallel to, and coextensive with, the Permanent
Easement. The Consfruction Easement shall terminate upon the earlier to occur
of (a) completion (as certified in writing by the Grantee to the Grantor) of the
5031MI3.1
Waterline construction, or (b) nine (9) months after commencement of
construction, which commencement is hereby defined to mean the
commencement of excavation work upon the Permanent Easement. In the event
the Grantee should be delayed or hindered or prevented From completing
construction and installation of the Waterline within the limo frame provided
above by reason of the acts and/or inaction of the Granta•, restrictive government
laws or regulations, insurrection, war, acts of God, and inclement weather or other
reasons of like nature not Nre Fault of the Grantee or its agents and contractors,
then the period fot• the pet~ormance of the completion of the construction and
installation of the Waterline shall be excused for the period of the delay and shall
be extended for a period equivalent to the period of such delay. The Grantee shall
restore the Construction Easement area to as close to its original condition as
reasonably practical.
(3) Neither the Grantor nor any successor owner of the Premises shall disconnect,
disturb, or otherwise interfere with the continued use of the Waterline, nor shall
any such parsons erect or permit the erection of any buildings, slabs, structures, or
other improvement within the boundaries of the Permanent Easement, or which
would otherwise interfere with the Waterline's continued use and maintenance.
With respect to any buildings, slabs, structures, or other improvements
encroaching on the Permanent Easement as of the date of this Agreement, the
Grantee shall have the right to remove such building, slab, structure, or
improvement to allow for fhe construction, operation, maintenance, or repair of
the Waterline. The Grantee shall, however, take reasonable precautions to
preserve any mature trees existing within either the Permanent Easement or fhe
Construction Easement. To the extent that construction of the Waterline results in
the removal of brush from the Easements, the Grantee shall arrange for the
disposal of the brtiish at the Grantee's sole cost and expense.
(4) The Easements herein granted sltall run with the land and be binding upon and
inure to the benefit of the Grantor and the Grantee, and (heir respective
successors, assigns, and legal representatives, and shall be binding upon all patties
having or acquiring any right, title or interest in the Premises or any portion
thereof.
(5) Should it become necessary at any time subsequent to completion to the
construction of the Waterline for the Grantee to enter the G•antor's Premises for
the purpose of maintaining, repairing, operation, or altering the Waterline in any
way, the Grantee shall, after each entry upon the Premises, leave the Premises
substantially in the same condition that it was in prior to such entry to the full
extent reasonably practicable. ]f any repair or replacement activities become
necessary as a result of the acts, omissions, or negligence of the owner or owners
of the Premises or any of their tenants, or any of such persons' respective agents,
employees, licensees, or invitees, then such owner or owners shall Ue responsible
for promptly performing, at their sole cost and expenses, all necessary repairs,
and, if they fail ko do so, the Grantee (ot• its successors or assigns, as applicable)
sonoau.r - 2 -
shall be entitled to do so and to recovet• all reasonable costs therefore from the
owner or owners (jointly and severally) of the Premises,
(6) The Easements are fiu•ther made subject to all validly existing easements, rights-
of-way, conditions, restrictions, covenants, or outstanding mineral or royalty
interests or reservations, of record, if any, in Guadalupe County, Texas as of
the date hereof.
(7) The Grantee may exercise its rights hereunder directly by its employees or by its
conhactors or any duly authorized agent.
TO HAVL AND TO HOLD said Easements together with all and singular the rights and
appurtenances thereto anywise belonging unto the Grantee, its successors and assigns; and the
Grantor does hereby bind itself, its successors and assigns, to specifccally wan•ant and forever
defend the Easements unto the Grantee, its successors and assigns, against every person
whomsoever lawfidly claiming or to claim the same or any part thereof, by, through, or under the
Grantor, buy not odrerwise, subject, however, to the matters set forth herein.
Executed to be effective as of _, 201_ (the "Effective Date").
[signalnres and acknorvledge~neMs on the following pages]
soa~aia.i - 3 -
This instrument has been executed as of the dates of the acluiowledgments to be effective
as of the Effective Date.
THE STATE OF l~X~/J
GRANTOR:
OGVP, Ltd.
By: ~y~9
Name: S~e~ raha
Title: General ParGtor
COUNTY OF GUadr.~~-~ §
1 u5~ L~1~
This instrument was~~ac~k"n~o~~wlnnedged before~me o/n the ~' day of may, ~0•t6" by
~. Rr~,.L.._ , aS ('X../~JLlral[Yr~f>4.~ Of ~ L~~17'j ~-.~~ , oli
behalf of such ~ VP, Lh~ .
(SEAL)
Nolary Pn lic ii and fo~
The Slate of ~_~r~p
My Conunission Expires: 07/
so~iaais.i - 4 -
GRANTEE:
CITY OF SCHERTZ
THE STATE OF TEXAS
COUNTY OF GUADALUPE
Jolm C. Kesel
City Manager, Cily of Schertz
This instrument was acknowledged before me on the _ day of , 20l_ by
Jolur C. Kesel, as City Manager of the City of Schertz, on behalf of such City.
(SEAL)
Notary Public in and for
The State of Texas
ATTER RECORDING RETURN TO;
Katherine A. Tapley
Fulbrigl~t & Jaworski L.L.P.
300 Convent Street, Suite 2100
San Autonio, Texas 78205
My Conunissiou Expires:
so3ioaia.i - 5 -
EXHIBIT A
Permanent basement
50310413, I A- ~