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HomeMy WebLinkAboutResolution - 3902 - Funds Investmenets - 05/28/1992Kesolution No. iguz May 28, 1992 Item #17 RESOLUTION WHEREAS, the City of Lubbock (the "Participant") is a political subdivision of the State of Texas and is empowered to delegate to a public funds investment pool the authority to invest funds, to act as a custodian of investments purchased with local investment funds; and WHEREAS, it is in the best interest of the Participant and its inhabitants to invest local funds in investments that yield the highest possible rate of return, while providing necessary safekeeping and protection of the principal; and WHEREAS, the Treasurer of the State of Texas, acting by and through the Texas Treasury Safekeeping Trust Company (the "Trust Company"), has created "TexPool", a public funds investment pool, to effectuate the goals of providing investments at the highest possible yield and maintaining complete safety of the funds of the Participant; NOW THEREFORE: BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF LUBBOCK: SECTION 1. THAT the City of Lubbock shall enter into a Participation Agreement to establish an account in its name with the Trust Company's Local Government Investment Pool, "TexPool", for the purpose of transmitting local funds for investment by the Trust Company in TexPool. SECTION 2. THAT the following individuals, whose signatures appear on page 2 of this Resolution, are officers, employees, or authorized representatives of the Participant and are each hereby authorized to transmit funds to the Trust Company for investment in TexPool and are each further authorized to withdraw funds from time to time, to issue letters of instruction, and to take all other actions deemed necessary or appropriate for the investment of local funds: 1. Name: Robert Aassengale Title: Assistant City Manager Signature( — )��,Q� for Financial Services 2. Name: Betsy Wood M1 Title: Assistant Director of Signature L ov Finance SECTION 3. THAT this Resolution and its authorization shall continue in full force and effect until amended or revoked by the Participant, and until the Trust Company receives a copy of any such amendment or revocation. The Trust Company is entitled to rely on this Resolution until such time. This Resolution is hereby ntroduc and the Participant at its regular/special meeting held on the Afth day of —'� , 1992. A&MMI A Iail-II-XI Kangtte boya, city secretary APPROVED AS TO CONTENT: ert Massengale, Assistant/City 'Manager for Financial Services ,—A-RPVED AS TO FORM: A -� 'n D G. Vandiver, Fi st Assistant City Attorney DGV:dw agenda-D#2/TexPoo1.Res — 2 — Resolution No. 3902 May 28, 1992 Item #17 TEXAS STATE TREASURY Texas Local Government Investment Pool Participation Agreement PREAMBLE This participation agreement dated as of the 28 day of May ,19 92, (the "Participation Agreement") is made and entered into by and between the Texas State Treasurer (the "Treasurer") and the City of Lubbock (the "Participant"). WHEREAS, the Interlocal Cooperation Act, TEX. REV. CIV. STAT. ANN. art.4413 (32) et sec as amended and TEX. REV. CIV. STAT. ANN. art. 4413 (34 (c)) (the "Acts") provide for the creation of public funds investment pools to which any political subdivision may delegate, by contract, the authority to hold legal title as custodian and to make investments purchased with local investment funds; and WHEREAS, the Treasurer has created Texas Treasury Safekeeping Trust Company (the "Trust Company") which receives, transfers and disburses money and securities belonging to state agencies and local political subdivisions of the state and for which the Treasurer is the sole officer and director and which is managed by Treasury employees; and WHEREAS, the Treasurer has created the Texas Local Government Investment Pool ("TexPool") as a public funds investment pool, which TexPool funds shall be invested in certain eligible investments as more fully described hereafter, NOW THEREFORE for and in consideration of the mutual promises, covenants and agreements herein contained and other good valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree with each other as follows: ARTICLE I. DEFINITIONS "ACH" shall mean Automated Clearing House electronic fund transfers. "Authorized Investments" shall mean, in accordance with the Act, the purchase, sale and investment of funds under TexPool's control in the following: 1. Obligations of the United States or its agencies and instrumentalities; 2. Direct obligations of the State of Texas or its agencies; 3. Other obligations, the principal of and interest on which are unconditionally guaranteed or insured by the State of Texas or the United States; 4. Obligations of states, agencies, counties, cities, and other political subdivisions of any state having been rated as to investment quality by a nationally recognized investment rating firm and having received a rating of not less than A or its equivalent; 5. Certificates of Deposit issued by state and national banks domiciled in this state that are: A. Guaranteed or insured by the Federal Deposit Insurance Corporation, or its successor; or B. Secured by obligations that are described by subdivisions 1-4 of this subsection, which are intended to include all direct agency or instrumentality issued mortgage backed securities rated AAA by a nationally recognized rating agency, or by Chapter 726, Acts of the 67th Legislature, Regular Session, 1981 (art. 2529b-1 TEX. REV. CIV. STAT. ANN.), and that have a market value of not less than the principal amount of the certificates; cates; 6. Fully collateralized direct repurchase agreements having a defined termination date, secured by obliga- tions described by Subdivision 1 of this subsection, pledged with a third party selected or approved by the political entity, and placed through a primary government securities dealer, as defined by the Federal Reserve, or a bank domiciled in this state; and Certificates of Deposit issued by savings and loan associations domiciled in this state that are: A. Guaranteed or insured bytheFederal Savings and Loan Insurance Corporation or its successors; or B. Secured by obligations that are described by Subdivisions 1-4 of this subsection, which are intended to include all direct federal agencies or instrumentality issued mortgage backed securities that have a market value of not less than the principal amount of the certificates. 8. Such other investments as may be authorized by TEX. REV. CIV. STAT. ANN. art. 842a-2 as amended from time to time. "Authorized Representative(s) of the Participant" shall mean those individuals who are authorized to execute documents and take such other necessary actions under this Participation Agreement as evidenced on behalf of the Participant by duly enacted resolution of the Participant, a certified copy of which is on file with the Trust Company. "Authorized Representative(s) of the Trust Company" shall mean those employees of the Treasury authorized to execute documents and take such other necessary actions including the investment of funds under this Participation Agreement on behalf of the Trust Company as evidenced by resolution of the Trust Company, a certified copy of which is on file with the Participant. "Data Collection Center" shall mean a third party vendor used by the Trust Company to collect and disburse fund remittance information reported by the Participants. "Letter of Instructions" shall mean a written authorization and direction to the Trust Company signed by an Authorized Representative of the Participant. "Treasury' shall mean the Texas State Treasury Department. "Wire Transfers" shall mean directlywired transfers ofTexPool funds or ofParticipant's funds through theFederal Reserve Bank System. ARTICLE II. PARTICIPATION REQUIREMENTS Section 2.01. The Participation Agreement. The Participant must execute a Participation Agreement before depositing any funds into TexPool. Further, a duly certified copy of a resolution by the Participant designating Authorized Representatives of the Participant must accompany the executed Participation Agreement. Section_2-02. Creation of TexPool. The Treasurer, as Trustee, hereby creates and establishes TexPool as a separate and distinct trust fund to be held outside the Treasury and to be managed in accordance with this Participation Agreement for the benefit of the Participants. Further, the Treasurer hereby designates and appoints the Trust Company to operate and manage TexPool and, to the extent permitted bylaw, appoints the Trust Company to act as custodian of all monies deposited by the Participant in TexPool and to receive, hold, invest and manage all monies deposited by the Participant into TexPool. By executing this Participation Agreement, the Participant hereby consents to the foregoing. The Treasurer aging through the Trust Company hereby agrees to manage the Participant's monies with the same degree of care and assuming the same duty to each Participant that is applicable to the management of funds held inside the Treasury. Section 2.03. Accounts, SubAcounts and Ownership Interest. The Trust Company shall establish and maintain separate account(s) for each Participant in TexPool in accordance with a duly executed Letter of Instructions (the "Accounts"). Separate SubAccounts may also be established within each Accohnt , as so directed from time to time in a Letter of Instructions (the "Sub - Accounts"). Each Participant shall own an undivided beneficial interest in the assets of TexPool which shall consist of the proportional amount each Participant's Accounts bear to the total amount of all Participants' Accounts in TexPool, computed on a daily basis. An Authorized Representative of the Participant may also eliminate inactive Accounts and SubAccounts from time to time if the request is confirmed by a duly executed Letter of Instructions. ARTICLE III. FUND TRANSFERS IN TEXPOOL Section 3.01. Method of Transfer of Funds. All fund transfers, both deposits and withdrawals, shall be by ACH or by Wire Transfers. Presentation of physical items for deposit and/or withdrawal will not be accepted. The Participant agrees to effect ACH deposits and withdrawals by contacting TexPool's Data Collection Center using a touch-tone telephone, a computer with a modem or by rotary telephone talking to a live operator. Section 3.02. ACH Fund Transfers. In order to remit funds to TexPool, the Participant may initiate an ACH withdrawal from its designated financial institution account by reporting remittance information via a toll -free telephone call to the Data Collection Center. The Data Collection Center will immediately notify the Trust Company and the Trust Company will credit the Participant's account with available funds in the amount of the remittance on the next business day. All deposit and withdrawal instructions for ACH fund transfers must be received by the Data Collection Center before 12:30 p.m. (Austin time) one day prior to funds transfer on settlement day. In addition the Participant may also initiate ACH credits to TexPool which must be reported to the Data Collection Center before 12:30 p.m. (Austin time) one day prior to funds transfer on settlement day. The Texas State Treasury's Rapid Deposit Program Division shall be responsible for establishing and maintaining the ACH system and Data Collection Center on behalf of all Participants. Section 3.03. Wire Transfers. Notification of all Wire Transfers, including both deposits and withdrawals, must be made by 10:00 a.m. on the same business day, provided the Participant immediately notifies the Authorized Representative of the Trust Company by telephone call or by facsimile machine ("fax"). For all Wire Transfer withdrawal requests the Trust Company's Authorized Representative will perform a call-back verification and authorization prior to effectuating any withdrawal. Section 3.04. Deposits. Upon receipt by the Trust Company's Authorized Representative of notification by the Data Collection Center or receipt of any WireTransfer, the Trust Company will credit Participant's Accountswith available funds. Same day deposits pursuant to Section 3.03 hereof may only be effectuated by Wire Transfer. All deposits will be accepted regardless of the day and time it is received by the Trust Company. Section 3.05. Late Deposits. Because of the fluctuation in investment markets and its effect on investment decisions, late deposits may not be includable in that day's TexPool assets. As used in the section, the term "late deposits" shall mean: (a) Wire Transfers other than those described in Section 3.03 and (b) All other deposits received after 12:30 p.m. (Austin time). The Participant agrees that late deposits may be segregated into an independent and separate investment overnight only. The Participant hereby acknowledges that frequently late day investments are made at a lower interest rate yield, which would diminish the remainder of the TexPool Participants' investment return income. The Participant agrees that the Trust Company shall use its best efforts to purchase the highest interest rate yielding investment, however a decision to segregate a late deposit for purchase of a separate lower yielding investment instrument will be made at the discretion of the Trust Company's Authorized Represen- tative. In the event the Trust Company determines to invest a late deposit in a segregated lower yielding investment instrument, only the affected Participant's Accounts will receive the appropriate income earnings associated with the late deposited investment on the next business day. The funds will be merged into TexPool on the next business day. For all deposits received after 12:30 p.m., noon (Austin time), and in the event there is no suitable late day investment for a late deposit, the funds will be held in the Participant's Accounts as a cash (non -interest bearing) deposit in the Trust Company's Federal Reserve Bank of Dallas account in order to maintain complete security of the funds. The funds will be merged into TexPool on the next business day. Sec[iorr3.06. Withdrawals. To withdraw funds by Wire Transfer from TexPool, an Authorized Representative of the Participant shall issue instructions not later than 10:00 a.m. (Austin time) on the day the funds are to be withdrawn, specifying the Account or SubAccount and the amount of money to be wired or transferred in immediately available funds to the Participant's 3 designated local bank account. Such instructions may be oral, provided however that a written Letter of Instruction signed by an Authorized Representative of the Participant is sent to the Trust Company within 24 hours of the oral instructions. All oral instructions shall be subject to a call-back verification as described in Section 3.03. Upon receipt of a withdrawal request theTrust Company will verify that the Participant's Account balance is sufficient to honor the request, and if so, the Trust Company will transfer the requested funds to the Participant's designated local bank account in next day available funds by ACH, unless otherwise so instructed by the Participant. Instructions from the Participant to withdraw the total balance in the Accounts or SubAccounts may include any interest earnings credited to the Accounts or SubAccounts through the day of the withdrawal. In all other circumstances accrued interest shall be credited daily and paid at the end of the month. Section 3.07. Late Withdrawals. Same day withdrawal requests must be received by 10 :00 a.m. and may only be effectuated by Wire Transfer. A late withdrawal request may be subjected to and conditioned upon the ability of the Trust Company to fund the withdrawal request. However, the Trust Company agrees to use its best efforts to honor such late withdrawal requests and to notify the Participant immediately with information concerning disposition of the late withdrawal request. Section 3.08. Separation of Accounts. TexPool was created to establish a fund that may be commingled for purposes of common investment and operational efficiency. However, each Participant shall have separate Accounts and SubAccounts on the books and records of TexPool which shall be maintained by the Trust Company. ARTICLE IV. INVESTMENTS AND DUTIES Section 4.01. Investments. All monies held in TexPool shall be invested and reinvested by the Authorized Representa- tives of the Trust Company only in Authorized Investments. TexPool's available funds that are uninvested shall be held at the Trust Company's account at the Federal Reserve Bank of Dallas. All investments of both assets and collateral will be in the possession of the Trust Company and held in its book -entry safekeeping account at the Federal Reserve Bank of Dallas. Section 4.02. Failed Investment Transactions. In the extraordinary event that a purchase of securities results in a failed settlement, any resulting uninvested funds shall remain in the Trust Company's Federal Reserve Bank of Dallas account. If an alternative investment can be secured after the failure of the trade to settle, TexPool will receive all the income earnings, including but not limited to, compensation from the purchaser failing in the trade and the interest income from the alternative investment. Section 4.03. Investment Earnings Allocation. All interest earnings in TexPool will be valued daily and credited to the Participant's Accounts and SubAccounts monthly, on a pro rata allocation basis. All losses, if any, resulting from the investment of monies in TexPool shall also be allocated on a pro rata allocation basis. Section 4.04. Specific Investment Requirements. Because TexPool is designed to give each Participant immediate access to their funds, the dollar weighted average maturity of the investments in TexPool will not exceed 120 days. -- All collateral securing repurchase agreements will be repriced daily and maintained at a minimum of 100% coverage of the originally invested principal amount, which shall be reviewed from time to time by the TexPool Advisory Board as part of the Investment Policy. Section 4.05. TexPool Advisory Board. There has been created the TexPool advisory board (the "Advisory Board") which consists of at least 10 members, each appointed by the Treasurer for a staggered term of three (3) years. The Advisory Board shall review and approve an investment policy for TexPool. The Advisory Board shall also have responsibility for any modification or other amendments of the fee structure which is more fully described in Section 5.01 herein. The Participant by execution of the Participation Agreement hereby agrees to be bound by all policies, fee schedules, and other rules which maybe adopted by the Ad- visory Board. Section 4.06 Liability. Neither the Treasurer, the Trust Company, any Treasury employees, nor any of the members of the Advisory Board shall be held liable for any action or omission to act on behalf of the Treasury, Treasury employees, or the Participants unless caused by gross negligence or willful misconduct. ARTICLE V. EXPENSES AND REPORTS Section.5.01. Fees and Expenses. Attached hereto is a scheduleof fees for basic and special services. The Participant agrees to pay to the 1 Vust Company an amount set forth in the fee schedule which shall be sufficient to reimburse the Trust Company for its actual costs of performing its duties under this Participation Agreement. Participant agrees that all fees shall be directly and automatically assessed and charged against the Participant's Accounts and SubAccounts. The basic services fee shall be calculated 4 as a reduction in the daily income earned, thus only the net income shall be credited to the Participant's account. Fees for special services shall be charged to each Participant's account as they are incurred or performed. A schedule of fees shall be sent annually to the Participant. Fees shall only be changed upon the approval of the majority of TexPool's Advisory Board. Each Participant will be notified thirty (30) days prior to the effective date of any change in the fee schedules. Section 5.02. Penalties for Losses. All actual costs, including but not limited to, losses of investment income for TexPool associated with ACH returns or by failure to timely transmit a Wire Transfer for deposit will be charged against the Participant's Accounts and SubAccounts unless such failure was beyond the control of the Participant. TheTrust Companywill make every effort to mitigate any adverse cost being incurred by the Participant. The Trust Company shall only recover the actual costs incurred in the event of any loss. Section 5.03. Reports. The Trust Company shall submit a written report to the Participant which shall include a detailed listing of all transactions occurring in the Participant's Accounts and SubAccounts for the previous month, within the first five (5) business days of the next succeeding month. Such report will indicate the balance remaining in the Participant's Accounts and SubAccounts, the daily and monthly yields of interest earned, all deposits and withdrawals, and all expenses, including the basic services fee and any special fees assessed, in accordance with generally accepted accounting principles. Additionally, the Trust Companywill maintain copies of the Participant's Accounts and SubAccounts reports in physical or computer form for a minimum of three prior fiscal years. This information will be available to assist the Participant in any special research or report request. Copies of all Participants' reports shall be available for public examination at the Trust Company's offices at the Treasury. These reports and summary information shall be presented to the Advisory Board. All records shall be available for inspection at all reasonable hours of the business day and under reasonable conditions. The Trust Company will attempt to keep confidential all historical account information and current balances of the Participant. However, the Participant acknowledges that the Trust Company is subject to the Open Records Act, TEX. REV. CIV. STAT. ANN. art. 6252-17a, as amended. ARTICLE VI. SPECIFIC PARTICIPANT INFORMATION Section 6.01. Account Number and Password. Each Participant shall be assigned a unique identifying number, and each Authorized Representative of the Participant shallbe assigned a unique identifying password. Additionally, each Account and Sub - account will be assigned a unique number. The Participant hereby agrees that the unique passwords and account numbers are required to implement any deposit or withdrawal to the Participant's Accounts or SubAccounts. The Trust Company agrees that such account numbers and passwords shall be maintained by the Trust Company and the Trust Company shall decline to disclose said unique identifying information except with the consent of the Participant or the Participant's Authorized Representative. Section 6.02. Bank Account. The Participant's local bank account and information is set forth on the attached routing form. Any amendment or change to the above described information must be submitted in writing to the Trust Company and must include clear instructions for effecting future deposit and withdrawal transactions. The Trust Company will implement these changes within 15 business days of receiving the notification. The Trust Companywill forward this information to the Rapid Deposit Program Division of the Treasury. Section 6.03. Notices. Any notices, Letters of Instructions, or other information required or permitted to be given hereunder shall be given in writing and shall be deemed duly given when mailed by registered or certified mail, postage prepaid, addressed or telefaxed as follows: To the Particpant: Participant Name City of Lubbock Contact Person David R. Langston Address _ -- --Telephone No. P.O. Box 2000 Lubbock, Texas 79457 (806) 767-2010 TelcFax No. (806) 762-3623 5 To the Trust Company: r Trust Division Texas State Treasury Department P.O. Box 12608, Capitol Station Austin, Texas 78711 Telephone No. (512) 440-4740 or call Toll Free: 1-800-234-LGIP Telefax No. (512) 440-4749 Section 6.04. Taxpayer Identification Number. The Participant's taxpayer identification number assigned by the Internal Revenue Service is: 1-75-6000590-6 . The Participant hereby agrees to notify the Trust Company of any change affecting this Taxpayer Identification Number and agrees that unless and until so notified, the Trust Company shall be entitled to rely on same in providing any and all reports or other information necessary or required by the Federal tax laws as amended from time to time. ARTICLE VII. MISCELLANEOUS Section 7.01. Severability. If any provision of this Participation Agreement shall be held or deemed to be in fact illegal, inoperative or unenforceable, the same shall not affect any other provision or provisions herein contained or render the same invalid, inoperative or unenforceable to any extent whatsoever. Section 7.02. Limitation of Rights. With the exception of the rights herein expressly conferred, nothing in or to be implied from this Participation Agreement is intended or shall be construed to give any person other than the parties hereto any legal or equitable right, remedy or claim underor in respect to this Participation Agreement or anyof the covenants, conditions or provisions herein contained; this Participation Agreement and all of the covenants, conditions and provisions hereofbeing intended to be and being for the sole and exclusive benefits to the parties hereto as herein provided. The Participant further agrees that the Treasurer's responsibilities hereunder are limited to the management and investment of TexPool and the providing of reports and information herein required; neither the Treasurer nor the Trust Company shall be liable for any losses from investments and transfers made in accordance with the procedures set forth in this Participation Agreement. Section 7.03. Execution of Counterparts. This Participation Agreement may be simultaneously executed in several separate counterparts, each of which shall be an original and all of which shall constitute but one and the same instrument. Section 7.04. Applicable Law. This Participation Agreement shall be governed by and construed in accordance with the laws of the State of Texas and is wholly performable in Travis County, Texas. Section 7.05. Captions. The captions or headings in this Participation Agreement are for convenience only and in no way define, limit, or describe the scope or intent of any provisions, articles, or sections of this Participation Agreement. Section 7.06. Amendments. The Participant and the Trust Company may supplement, amend or modify this Partici- pation Agreement only if evidenced in a writing signed by both parties. Section7.07. Termination. This Agreement maybe terminated by either party hereto, with or without cause, by tendering 30 days' prior written notice in the manner set forth in Section 6.03 hereof. Section 7.08. Term. The continuance of this Participation Agreement is subject to and dependent upon appropriation of the necessary funds by the Texas Legislature. Otherwise, unless terminated in accordance with Section 7.07, it shall be automatically renewed on each anniversary date hereof. In Witness Whereof the parties hereto have caused this Participation Agreement to be executed in multiple counterparts as of the date first set forth above. ARTI(i ANT e 0 / _.Y TEXAS STATE TREASURER 0 Mayor, City of Lub5ock Title: 2/1/90