Title
Consider and take action on a resolution approving the City of League City’s Investment Policy, Investment Strategies, List of Authorized Broker/Dealers and Safekeeping/Custodial Agents for the City of League City (Director of Finance)
Background:
Approval of this item is for the Investment Policy, Investment Strategies, List of Authorized Broker/Dealers and Safekeeping/Custodial Agents for the City of League City with changes listed below.
ANNUAL APPROVAL REQUIRED:
Pursuant to the Public Funds Investment Act (PFIA), Texas Government Code, 2256, the governing body of an investing entity covered by the Act is required to review and approve the entity’s investment policies annually. The City’s policy was last approved on February 13, 2024.
PROPOSED CHANGES:
On December 16, 2024, the Finance Committee approved Commercial Paper as an eligible investment but only as part of an approved investment pool. Below are the proposed additions to update the current Investment Policy consistent with the Finance Committee’s action.
On page 10 of the Investment Policy, under Section 10 - D, there are two lines proposed to be added to the policy:
(D) Government/Private Sponsored Investment Pool
The investment pool must provide the Investment Officer with the following:
(1) Offering circular that contains specific detailed information as described in the Act,
(2) Investment transaction confirmations and detailed monthly transaction and performance reports as described in the Act,
The investment pools must also:
(1) Be continuously rated no lower than AAA or AAAm or an equivalent rating,
(2) Be marked-to-market daily if using amortized cost or fair value accounting and maintain stable net asset value ratio of between .995 and 1.005,
(3) Maintain stable net asset value of $1.00 when rounded and expressed to two decimal places,
(4) Maintain ongoing compliance with the Act, and
(5) Invest only in eligible investments under the Public Funds Invest Act
CERTIFICATION:
In October 2024, the City received recertification from the Government Treasurers’ Organization of Texas (GTOT) that the policy meets the requirements of the PFIA and the standards for prudent public investing established by GTOT. This is a two-year certification that expired October 31, 2026. Staff plans to reapply for certification in 2026 and believes that the proposed policy is in compliance with GTOT standards and PFIA requirements.
Attachments:
1.Proposed Resolution
2. Exhibit A - Investment Policy 2024 - Revised
FUNDING
{X} NOT APPLICABLE
STRATEGIC PLANNING
{X} Addresses Strategic Planning Critical Success Factor # 2 Financially Sustainable