Laserfiche WebLink
<br />C. Procedures for the Delivery and Possession of Securities: <br /> <br />Limiting cash investments to those instruments listed in part "A" of this <br />section provides minimal protection for the City. In order to increase <br />protection, the City has established delivery and possession procedures <br />that will be followed in every case. Specifically: <br /> <br />1. All ownership of securities shall be evidenced by an acceptable <br />safekeeping receipt issued by a third-party financial institution <br />that is acceptable to the City, or by a safekeeping receipt from the <br />Federal Reserve Bank. <br /> <br />2. All investment (or divestment) transactions will be accomplished <br />with authorized financial intermediaries on a "delivery vs. payment" <br />basis. In the absence of acceptable delivery, the City shall refuse <br />to enter the transaction. <br /> <br />3. <br /> <br />Repurchase agreements will meet the <br />criteria, and will be accompanied by a <br />excess of market value of securities <br />investment) . <br /> <br />aforementioned delivery <br />minimum "haircut" (i. e . , <br />over principal amount of <br /> <br />4. All wire transactions required to implement the aforementioned <br />purchase and sale transaction shall be supported by written <br />instructions to the City's designated depository, unless the timely <br />preparation of such written instructions would hinder the orderly <br />completion of the transaction itself. In such cases, the City will <br />prepare follow-up letters, confirming the oral (typically <br />telephonic) instructions, and forward such written instructions to <br />the bank without undue delay. <br /> <br />V. UTILIZATION OF MUNICIPAL CREDIT AUTHORITY <br /> <br />The City of San Marcos, like other municipalities throughout the United States, <br />is empowered to issue various forms of municipal debt. While the unrestrained <br />use of this authority is inappropriate, there are many circumstances in which the <br />application of specific borrowing techniques is in the financial interest of the <br />City and its taxpayers. <br /> <br />Such borrowing is closely regulated by federal law, Internal Revenue Service <br />regulations, specific provisions of the Tax Equity and Fiscal Responsibility Act <br />(TERFA), and various statutes of the State of Texas. Within the established <br />regulations and guidelines, however, the City has a great deal of latitude with <br />regard to the timing and general nature of its financing activities. <br /> <br />The City will utilize those financing alternatives and techniques that produce <br />positive financial advantages for its citizens. For example: <br /> <br />A. Immediate financing of capital construction programs, through the issuance <br />of either "permanent" or "interim" financing instruments, can "free up" <br />available cash balances for investment. This will allow the City to take <br />advantage of potential "posi ti ve arbitrage" during the "temporary period", <br />a period during which such "profits" are legally exempted from the <br />regulatory limits on such financial profits. As aresult, both the total <br />cash availability and investment-earning potential of the City can be <br />significantly enhanced. <br /> <br />City of San Marcos Cash Management and Investment Policy <br />Page 7 of 24 <br />