Board of Directors Regular Meeting Agenda


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Meeting Date: 02/20/2014  

SUBJECT MATTER:
Receive, consider and act upon recommendations from the Investment Committee and adoption of a resolution relative to annual review of the Township’s investment policy;
FISCAL IMPACT:
Not applicable
BACKGROUND:

The Public Funds Investment Act (Government Code, Chapter 2256) requires The Woodlands Township to review its Investment Policies annually and approve a resolution adopting such policies.

The attached Resolution Adopting Investment Polices and Guidelines for The Woodlands Township was prepared by legal counsel and reviewed by the Township’s financial consultant and Investment Committee. The policies and guidelines are the same as those adopted in 2013 except for the revisions outlined below.

• Section 5.D regarding Authorized Investments has been revised to clarify that the Township shall not own or invest in any obligations which it has issued.

• Section 6.1 regarding Authorized Collateral has been revised to include mortgage backed securities as an acceptable form of collateral for the Township’s time and demand deposits. The mortgage backed securities:
a. must be pass-through securities directly issued by a federal agency or instrumentality of the United States, the underlying security for which is guaranteed by the same;
b. cannot be Collateralized Mortgage Obligations (CMOs)
c. may not secure more than $8 million of the Township’s aggregate time or demand deposits at any given time

• Exhibit B, which is the Collateral Security Agreement executed by the Township and applicable financial institution, has been revised to reflect the revisions outlined above regarding mortgage backed securities as an acceptable form of collateral

• Exhibit B has also been revised to include letters of credit issued by the Federal Home Loan Bank as an acceptable form of collateral. The policy had previously allowed these letters of credit to serve as collateral, but the provision was inadvertently omitted from Exhibit B.

At its meeting on January 21, 2014, the Investment Committee recommended that the Board of Directors adopt the Resolution Adopting Investment Policies and Guidelines for The Woodlands Township.
RECOMMENDATION:
Approve Resolution Adopting Investment Policies and Guidelines for The Woodlands Township.
Attachments
Investment Policies and Guidelines


    

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