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described by the PFIA. <br /> 1. Obligations of the United States, its agencies and instrumentalities, excluding mortgage- <br /> backed securities. <br /> 2. Direct obligations of the State of Texas or its agencies and instrumentalities. <br /> 3. Other obligations, the principal of and interest of which are unconditionally guaranteed or <br /> insured by the full faith and credit of, the State of Texas. <br /> 4. Obligations of states, agencies, counties, cities, and other political subdivisions of any state <br /> rated as to investment quality by a nationally recognized investment rating firm not less than A <br /> or its equivalent. <br /> 5. Fully insured or collateralized depository certificates of deposit issued by state and national <br /> banks in Texas that are: <br /> a. Guaranteed or insured by the Federal Deposit Insurance Corporation or its successors; <br /> and <br /> b. Collateralized to at least 102% in accordance with this Policy (Section XI). <br /> 6. Fully collateralized direct repurchase agreements having a defined termination date, <br /> collateralized in accordance with this Policy, safe-kept with an independent third party <br /> approved by the City, with an executed master repurchase agreement, and placed through a <br /> primary government securities dealer, as defined by the Federal Reserve,or a bank doing <br /> business in Texas, not to exceed 90 days to the stated maturity. <br /> Flexible repurchase agreements (flex repos) are authorized for investment of bond proceeds, <br /> if collateralized in accordance with this Policy, safe-kept with an independent third party <br /> approved by the City, with an executed master repurchase agreement, and placed through a <br /> primary government securities dealer, as defined by the Federal Reserve. The term of the flex <br /> repo may exceed two years but not exceed the anticipated expenditure schedule of the bond <br /> proceeds and no party involved with the issuance of the debt shall be involved with the funds <br /> reinvestment. <br /> 7. Texas local government investment pools as defined and regulated by the PFIA and authorized <br /> by the City Council. Investment pools maintaining a $1.00 net asset value must calculate and <br /> report yield to investors in the pool in accordance with federal regulations applicable to money <br /> market funds. <br /> 8. Commercial paper rated not less than A1/P1 or its equivalent by two nationally recognized <br /> rating agencies and not to exceed 270 days to stated final maturity. <br /> 9. AAA-rated, SEC registered money market funds as described in Sec. 2256.014 of the PFIA. <br /> 10. FDIC insured brokered certificate of deposit securities from banks in any US state, delivered <br /> versus payment to the City's safekeeping depository, not to exceed one year to maturity. <br /> Before purchase the Investment Officer or adviser must verify the FDIC status of the bank on <br /> https://research2.fdic.gov/bankfind/index.html to assure that the bank is FDIC insured. <br /> 11. Interest bearing or money market accounts in any FDIC insured bank in Texas collateralized <br /> as required by this Policy. <br /> City of San Marcos Investment Policy 5 Rev 05.2025 <br />