Sec. 13-2. Investment of City monies.
A. Definitions.
1. Capital in the case of financial institutions shall have the meaning set forth in A.R.S. § 35-321, and in the case of dealers shall have the meaning set forth in Rule 15c3-1 of the United States Securities And Exchange Commission Uniform Net Capital Rule.
2. Collateral shall have the meaning of and meet the collateral requirements for State of Arizona investments set forth in A.R.S. § 35-323.
3. Dealer shall have the meaning set forth in A.R.S. § 44-1801.
4. Financial institution means a financial institution as defined in A.R.S. § 6-101 or a dealer.
5. Primary dealer means any dealer trading in securities of the United States of America for its own account and recognized as a "primary dealer" by the Federal Reserve Bank at New York, New York.
6. Principal office means the principal executive office so designated in the annual audited financial report of the financial institution.
B. Investment authority. The Finance Director of the City, under the general direction of the City Manager, shall have the right to invest temporarily idle City monies not needed to meet current obligations, to enter into agreements with financial institutions concerning same, and to adopt formal and informal practices concerning investment policies and placements, all in the exercise of reasonable and prudent investment policies and in accordance with reasonable interpretations of the guidelines set forth in this section. The Finance Director shall have the right to further delegate all or part of this authority by filing with the City Clerk the name, title, and authority of the employees so empowered.
C. General investment guidelines. Investments made pursuant to this section shall insure the safety of the investment principal, provide liquidity, and obtain the highest yield available commensurate with the City’s safety and liquidity goals. The Finance Director shall have the authority to establish guidelines to qualify financial institutions for investment purposes under this section and develop policies consistent with the investment safety, liquidity and yield objectives of the City.
D. Authorized investments and deposits. Investments of City monies shall be transacted with financial institutions approved by the Finance Director in:
1. Repurchase agreements collateralized with those obligations identified in Subsection D2.
2. Direct obligations issued by the United States of America or by any agency or instrumentality of the United States of America (including government sponsored enterprises).
3. Deposit accounts fully insured by an insuring instrumentality of the United States of America or collateralized as required by A.R.S. § 35-323.
4. Obligations issued or guaranteed by any city, county, state or political subdivision thereof that have an uninsured investment grade credit rating by a nationally recognized statistical rating organization designated by the United States Securities and Exchange Commission ("NRSRO").
5. Corporate bonds, debentures, notes and other evidences of indebtedness issued, assumed or guaranteed by any solvent entity created or existing under the laws of the United States of America or of any state, district or territory thereof, which are not in default as to principal or interest, including guaranteed investment contracts, mortgage backed securities, collateralized mortgage obligations, commercial paper, and bankers acceptances. Such obligations shall have an investment grade credit rating by an NRSRO.
6. The institutional class shares of an open-end fixed income or money market mutual fund registered with the United States Securities And Exchange Commission pursuant to the Federal Investment Company Act of 1940. The fund shall only invest in securities that comply with the requirements of Subsections D1, D2, D4, or D5, as reflected by prospectus or other fund statement of additional information.
E. Investment placement, general procedures. The Finance Director shall diversify investment placement. Whenever practicable, investment placement shall be on a competitive basis and consistent with the investment safety, liquidity and yield goals of the City. The Finance Director shall maintain a record of investment placement.
F. Financial institutions. The Finance Director may enter into transactions relating to authorized investments directly with the issuer of such securities, primary dealers, or any other financial institutions whose principal office is located in the State of Arizona. Such financial institutions shall have capital of at least ten million dollars. Whenever practicable, transactions shall be completed on a delivery versus payment basis.
G. Custodial agent. The City shall designate a custodial agent for the safekeeping of securities for the benefit of the City.
H. Reports. All financial institutions maintaining deposits or other investments hereunder shall file a report with the Finance Director no more than fifteen days after the end of each month. Such report shall identify the securities pledged as collateral pursuant to A.R.S. § 35-323, and include the par value and market value for each investment as of the last day of the month. (Ord. No. G-2654, § 2; Ord. No. G-2976, § 2; Ord. No. G-3276, § 1; Ord. No. G-3318, § 1; Ord. No. G-4524, § 1, 2003)