HomeMy WebLinkAboutResolution 2008-56 Temporary Investment Policy-(Repealing Resolutions 2008-51 and 2008-52)RESOLUTION 2008-56
A RESOLUTION OF THE CITY OF WINTER SPRINGS, FLORIDA
REGARDING THE INVESTMENT OF THE CITY'S SURPLUS
FUNDS; PROVIDING A TEMPORARY INVESTMENT POLICY
DUE TO THE STATUS OF THE SBA FUND AND THE CURRENT
ECONOMIC CRISIS; AUTHORIZING THE CITY MANAGER
AND FINANCE DIRECTOR TO IMPLEMENT THIS
TEMPORARY INVESTMENT POLICY IN ACCORDANCE WITH
THIS RESOLUTION UNTIL THE CITY COMMISSION DIRECTS
OTHERWISE; REPEALING RESOLUTIONS 2008-51 AND 2008-52
AND RESTATING THE RELEVANT PROVISIONS THEREIN IN
THIS RESOLUTION WITH MODIFICATIONS; PROVIDING FOR
CONFLICTS AND AN EFFECTIVE DATE.
WHEREAS, on or about November 29, 2007, the State of Florida suspended withdrawals from a State Board of
Administration investment fnnd ("SBA Fund") due to the financial instability of the SBA Fund; and
WHEREAS, like many cities, counties, and school districts, the City of Winter Springs had surplus funds deposited
with the SBA Fund which is an authorized investment under Section 218.415, Fla. Stat., for units of local
government in Florida; and
WHEREAS, due to this emergency situation, the City Commission held several emergency, special, and regular
meetings to address the SBA Fund situation; and
WHEREAS, on December 10, 2007, upon recommendation of the City's financial consultant, Bogdahn Consulting,
LLC (Bogdahn), and the City Manager, the City Commission directed the City Manager to work with Bogdahn to
liquidate the City's surplus funds on deposit with the SBA Fund (as the SBA Fund permitted) and to temporarily
deposit said liquidated surplus funds into one of three U.S. Treasury money market funds recommended by
Bogdahn; and
WHEREAS, since that time, the City deposited surplus into The Reserve, U.S. Treasury Fund Institutional Class
(The Reserve), which according to the fund's prospectus invests exclusively in securities backed by the full faith and
credit of the U.S. government; and
WHEREAS, in recent months, it has become evident to economists and governments around the world that there is
currently a world economic crisis which has severely impacted the world's financial markets; and
WHEREAS, because of the current economic crisis, the City Commission directed through Resolution 2008-51 that
additional temporary steps be taken to safeguard the principal and liquidity of the City's surplus funds by
withdrawing all the deposits from The Reserve and directly purchasing U.S. Treasury securities; and
WHEREAS, the City has withdrawn all of the deposits from The Reserve as directed by Resolution 2008-51; and
WHEREAS, due to changing circumstances relative to the purchase limitations on direct negotiable obligations of
the U.S. Treasury, the City Commission now desires to modify the temporary investment policy to authorize the use
of Certificate of Deposit Account Registry Services (CDARS) in addition to direct negotiable obligations of the U.S.
Treasury; and
WHEREAS, the investment in direct securities of the U.S. Treasury and in Certificate of Deposit Account Registry
Services (CDARS) are authorized investments under Section 218.415, Fla. Stat., for units of local government in
Florida; and
WHEREAS, it is the intent of the City Commission of Winter Springs to continue to place the highest priority on the
safety of principal and liquidity of the City's surplus funds; and
WHEREAS, the City Commission desires to update and modify the temporary investment policy adopted in
Resolution 2008-51 by adding Certificate of Deposit Account Registry Services (CDARS) as an authorized
investment and restating the still relevant provisions of the City's temporary investment policy which is set forth in
Resolutions 2008-51 and 52; and
WHEREAS, the City Commission of the City of Winter Springs finds that this Resolution is in the best interests of
the public health, safety, and welfare of the citizens of Winter Springs.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COMMISSION OF THE CITY OF
WINTER SPRINGS, FLORIDA:
SECTION 1. Direct U.S. Treasury Obligations; CDARS. Until further direction of the City
Commission, all City surplus funds shall be invested and reinvested in direct negotiable obligations of the U.S.
Treasury or in Certificate of Deposit Account Registry Services (CDARS) as follows:
(a) The City Manager is directed to invest and reinvest existing and new surplus funds in direct
negotiable obligations of the U.S. Treasury or in Certificate of Deposit Account Registry Services
(CDARS). Surplus funds may also be deposited in the City's interest bearing checking account if said
funds are needed for operational purposes.
(b) The City Manager shall continue to withdraw deposits from the SBA Fund when permitted by the
SBA Fund. Upon withdrawal, the deposits shall be invested and reinvested in direct negotiable
obligations of the U.S. Treasury or in Certificate of Deposit Account Registry Services (CDARS) as an
approved option for the investment of surplus City funds if said deposits are surplus funds or deposited
in the City's interest bearing checking account if said funds are needed for operational purposes.
(c) Investment of surplus funds in CDARS shall be limited to a maximum CD maturity of twenty-eight
(28) days. Upon expiration of the CD maturity date, surplus funds previously invested in CDARS shall
be reinvested in direct negotiable obligations of the U.S. Treasury or may be reinvested in CDARS one
additional time upon a majority vote of the City Commission.
SECTION 2. Implementation. Under the terms and conditions of the City's current Investment Policy, the City
Manager shall develop strategies to implement the directives set forth in Section 1 of this Resolution including, but
not limited to, making appropriate transactional and custodial arrangements for directly investing and reinvesting in
U.S. Treasury obligations or investing in CDARS. The City Manager, Finance Director, or other authorized City
representatives are authorized to execute such applications and other documents as are required to invest and reinvest
surplus funds in direct negotiable obligations of the U.S. Treasury or CDARS.
SECTION 3. RFP For A New Financial Adviser. As previously directed by the City Commission, the City
Manager shall continue to implement a Request for Proposals (RFP) for the City to retain the services of a new
financial adviser. Said RFP is due on December 17, 2008 at 3:00 P.M. Eligible financial adviser candidates
responding to the request for proposal shall be independent of any investment offerings to the City of Winter
Springs.
SECTION 4. Conflicts; Repeal. The provisions set forth in this Resolution shall take precedence over any
conflicting prior City resolution or policy adopted by the City Commission. Resolutions 2008-51 and 52 are hereby
repealed and replaced by this Resolution.
SECTION 5. Effective Date. This Resolution shall take effect immediately upon its adoption.
DONE AND ADOPTED in regular session of the City Commission of the City of Winter Springs, Florida, this 5'~
day of December 2008.
ATT T t
.-;
A RENZO-LUACES, City Clerk
Appr d as o legal form and sufficiency for
Th inter Springs only:
ANTHONY A. GARGANESE, City Attorney
CITY OF WINTER SPRINGS; FLORIDA
.,
JOHN BUSH, MAYOR