HomeMy WebLinkAbout023472 RES - 10/27/1998A RESOLUTION
AMENDING THE CITY INVESTMENT POLICY TO: DELETE REFERENCES
TO TEXPOOL INVESTMENT; RETITLE AND RENUMBER SECTIONS OF
THE CITY INVESTMENT POLICY; CLARIFY AND UPDATE INVESTMENT
TERMINOLOGY; AND ADOPTING THE CITY INVESTMENT POLICY AS
AMENDED.
WHEREAS, the City of Corpus Christi Investment Policy was adopted in Resolution No.
022390 on October 24, 1995, amended in Resolution No. 022980 on July 8, 1997; and amended
in Resolution No. 023133 on November 18, 1997;
WHEREAS, City of Corpus Christi Investment Committee reviewed the proposed
amendments to the Investment Policy identified in the attached summary and recommends that
the City Council amend the City Investment Policy to delete reference to Texpool Investment,
retitle and renumber sections of the City Investment Policy, and correct and update investment
terminology in the City Investment Policy; and
WHEREAS, as provided in Section II. C. of the Investment Policy, the City Council
must review the Investment Policy on or before December 31 of each year.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE
CITY OF CORPUS CHRISTI, TEXAS:
SECTION 1. The City Investment Policy is hereby amended and adopted. A summary
of the amendments is attached and incorporated as Exhibit A. A copy of the amended City
Investment Policy is attached and incorporated as Exhibit B.
ATTEST: THE CITY OF CORPUS CHRISTI
444/3,49247r—
City
Secretary
MAYOR
The City of Corpus Christi
Approved this the t5 day of O , 1998.
James R. Bray, Jr., City Attorney
By:
,.-Lw
Lisa Aguilar U
Assistant City Attorney
H:\LEG-DIRW OEMILL.ISAVLOARES.003
:^.'234'72
CORPUS CHRISTI, TEXAS
ar7 hi DAY OF O ..Th ii t./ 19 4d
The above resolution was passed by the following vote:
Samuel L. Neal, Jr.
Javier D. Colmenero
Melody Cooper
Alex L. Garcia, Jr.
Dr. Arnold Gonzales
Betty Jean Longoria
John Longoria
Edward A. Martin
Dr. David McNichols
H:\LEG-DIR\NOEMALISA\LOARES.003
023472
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SUMMARY OF
PROPOSED INVESTMENT POLICY
REVISIONS
Page 2 Deleted "APPENDIX C: TEXPOOL INVESTMENT RESOLUTION" and
renumbered the remaining appendices. The City ended our contract with TEXPOOL
in 1994 - resolution was revised by the TEXPOOL Board; a new resolution has not
been adopted by the City since we have not used TEXPOOL since December 1994.
Page 3 Replaced `Bond" in Section II.B. - Scope with "Capital Improvement" and expanded
the sources of funds to include "Interfund Transfer and Commercial Paper.
Page 5 Added "Corpus Christi Crime Control and Prevention District" to Section III. -
Definitions.
Page 6 Added "and repurchase agreements" to Section IV.D.- Diversification as the City
uses a tri -party repurchase agreement to ensure that the underlying collateral of
securities is maintained at 102% of the value of the investment at all times.
Page 6 Replaced "this method" with "Delivery versus Payment."
Pages 7-10 Renumbered "V. AUTHORIZED INVESTMENTS AND MAXIMUM TERM"
from "1.a.(1)....5." to "A.1.a. C."
Page 7 Deleted Section V.A.1.c."U.S. Treasuries (Interest Only)...up to 3 years" --
combined it with Section V.A.1.d. "U.S. Treasury Notes and Strips...up to 3 years
(except as listed in Section V.B.3.)" and consolidated it with Section V.A.1.c.
Added "tri -party" to " Section V.A.3. - Repurchase Agreements" to describe the
types of repurchase agreements the City uses.
Page 8 Deleted "(see attached and incorporated Appendix C)" in Section V.A.4., as it
referenced TEXPOOL.
Renumbered sub -section "1 and 2" to "a and b" under Section V.B.5.-Collateralized
Certificates of Deposit.
Changed Section V.A.5. - Collateralized Certificates of Deposit (last paragraph) to
positively state the type of collateral accepted by the City rather than starting the
sentence with "no."
Exhibit A
r
Page 9 Deleted "less than" and added "or less" to Section V.B.1.- Operating Funds to read
"The weighted average days to maturity of investments, other than Reserve Funds,
shall be 365 days or less."
Page 10
Page 11
Page 13
Changed Section VI.B. - Strategies from "General Operating and Bond Funds" to
"Operating Funds and Capital Improvement Funds."
Renumbered Section VI.C.- Achieving Investment Return Objectives, subsections
"1.a. -c. and 2.a. -b."
Added "or" to Section VI.C.2.a. as it was needed to read clearly.
Replaced "rates" in Section VI.C.2.b. with "projections."
Replaced "that wishes" in Section VIII. COMPETITIVE SOLICITATION with
"authorized", replaced "Section IV.D." with "Section X. - PLEDGED
COLLATERAL" and replaced "call reports on a quarterly basis by the 15th day after
the required submission date" with "annual financial reports."
Added to Section IX. AUTHORIZED INSTITUTIONS "and the Year 2000
Compliance Statement" to ensure that business partners are or in the process of
attaining Year 2000 compliance.
Page 15 Changed reference from "Appendix F' to "Appendix E - WIRE AND
ELECTRONIC SERVICES."
Page 16 Added "The investment committee consists of' to Section XIILA. - Investment
Committee.
Page 17
Added to Section XIII.B: "1.c. Collateral Position."
Deleted "Monthly basis" and replaced with "Demand Generated Reports" to Section
XIII.B.2.
Deleted Section XIII.B.2.c relating to TEXPOOL and renumbered XIILB.2.d.
"Market Value vs. Book Value Analysis of Investment Portfolio."
Deleted "for seven years from City's current fiscal year" from Section M.D. -
Record Retention, to follow retention schedules promulgated in the Texas State
Library Municipal Records Manual.
Page 18 Changed the reference from "Appendix G" to "Appendix F - INVESTMENT
POLICY RESOLUTIONS."
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Page 35 Deleted from "APPENDIX B: LIST OF AUTHORIZED CITY
REPRESENTATIVES", the former Director of Finance, Jorge Cruz-Aedo.
Page 36 Renamed "APPENDIX D" to "APPENDIX C: CITY'S CODE OF ETHICS
ORDINANCE."
Page 51 Renamed "APPENDIX E" to "APPENDIX D: CITY'S INDEMNIFICATION
ORDINANCE."
Page 54 Renamed "APPENDIX F" to "APPENDIX E: WIRE AND ELECTRONIC
SERVICES."
Page 59 Renamed "APPENDIX G" to "APPENDIX F: INV. POLICY RESOLUTIONS".
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CITY OF CORPUS CHRISTI
INVESTMENT POLICY
OCTOBER 23, 1998
Exhibit B
1
TABLE OF CONTENTS
I. INTRODUCTION 3
II. PURPOSE 3
III. DEFINITIONS 4
IV. INVESTMENT OBJECTIVES 5
V. AUTHORIZED INVESTMENTS AND MAXIMUM TERM 7
VI. INVESTMENT MIX AND STRATEGIES 10
VII. RESPONSIBILITY AND CONTROLS 12
VIII. COMPETITIVE SOLICITATION 13
DC. AUTHORIZED INSTITUTIONS 13
X. PLEDGED COLLATERAL 14
XI. SAFEKEEPING 15
XII. WIRE AND ELECTRONIC SERVICES 15
XIII. INFORMATION REPORTING/EVALUATION 16
XIV. BANKING SERVICES 17
XV. GENERAL PROVISIONS 17
APPENDICFI
A. APPENDIX A: PUBLIC FUNDS INVESTMENT ACT 19
B. APPENDIX B: LIST OF AUTHORIZED CITY REPRESENTATIVES 35
Csift APPENDIX C: CITY'S ODE OF ETHICS. ORDINANCE 36
I,E APPENDIX D: CITY'S INDEMNIFICATION ORDINANCE 51
E.F7 APPENDIX E: WIRE AND ELECTRONIC SERVICES 54
E,GT APPENDIX G: INVESTMENT POLICY RESOLUTIONS 59
Exhibit B
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L INTRODUCTION
It is the policy of the City of Corpus Christi to invest all available monies in conformance with these
legal and administrative guidelines.
Effective cash management is recognized as essential to good fiscal management. An aggressive cash
management program will be pursued to maximize interest earnings as a viable and material revenue
source. The City's portfolio shall be designated and managed in a manner responsive to the public
trust and consistent with local, state, and federal law.
Investments shall be made with the primary objective of
o Preservation of capital and protection of principal;
o Maintenance of sufficient liquidity to meet operating needs;
o Security of City funds and investments;
o Diversification of investments to minimize risk while maximizing interest earnings; and
o Maximization of return on the portfolio.
Earnings from investments will be used in a manner that will best serve the interests of the City of
Corpus Christi.
II. PURPOSE
A. Authorization
This Investment Policy is authorized by the City Council (see Appendix G) in
accordance with Chapter 2256, Subchapter A of the Government Code - The Public
Funds Investment Act (see the attached and incorporated Appendix A).
B. Scope
This Investment Policy applies to activities of the City, excluding pension funds, with
regard to investing the financial assets of all Funds, including, but not limited to, the
following Funds:
General Operating Funds
Special Revenue Funds
Enterprise Funds
Internal Service Funds
Special Purpose Funds (within the control of Investment Officers)
capital Improvement Bond Funds (Bond Proceeds, Bond Reserves, Debt Service,
Interfund Transfer and Commercial Paper
In addition to this policy, the investment of Bond Funds, Debt Service, and Reserve
Funds shall be managed by their governing ordinances and Federal Law, including the
Tax Reform Act of 1986 and subsequent legislation.
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C. Review and Amendment
This Policy shall be reviewed annually by the City Council on or before December 31
of each calendar year subsequent to its adoption. Amendments must be authorized
by the City Council. The City Council shall adopt a written instrument by ordinance
or resolution stating that it has reviewed the Investment Policy. The written
instrument so adopted shall record any changes made to the Investment Policy.
M. DEFINITIONS
Director of Finance - The Director of Finance is the Municipal Finance Officer responsible for City
investments.
Director of Finance's Designee - Controller or Chief Accountant
Excess Cash Balances - Collected bank balances not needed to pay estimated check clearings.
Investment Officers - City Treasurer and Investment Analyst
Investment Portfolio - All City monies being invested under authority of the Investment Officers.
Institution - Any firm, bank, bankholding company, broker or dealer who provides quotes for either
the purchase or sale of investments.
Third Party Safekeeping Institution - Any Institution not affiliated with Institution delivering the
Investment.
Investment - All authorized Securities listed in Item V. "AUTHORIZED INVESTMENTS AND
MAXIMUM TERM." Investments approved by the Investment Committee include U.S. Treasuries,
U.S. Agencies, Repurchase Agreements, Local Government Investment Pool, and Collateralized
Certificates of Deposit.
Decayed Transaction - An Investment which an Institution fails to deliver the City's Third Party
Safekeeping Institution.
Collateral - Securities pledged by an Institution to safeguard City assets; the City requires either U.S.
Treasuries or U.S. Agencies Securities so that the market values can be readily determined at any
point in time.
Authorized City Representative - Officers authorized to transact as set out in the attached and
incorporated Appendix B on behalf of the City (City Treasurer, Controller, Chief Accountant, and
Director of Finance).
Reserve Funds - Funds designated by Council for specific purposes which have not been appropriated
for spending.
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Securities - Approved Investments designated by the Investment Committee to be held in the
Investment Portfolio or acceptable to be pledged as Collateral to secure the monies of the City.
Special Purpose Funds - Monies of non-profit corporations that Investment Officers are permitted
to invest; includes such entities as the Corpus Christi Health Facilities Development Corporation,
Coastal Bend Health Facilities Development Corporation, Corpus Christi Housing Finance
Corporation, Corpus Christi Community Improvement Corporation, HOME Project, First Time
Home Buyer, and Corpus Christi Industrial Development Corporation, and o risti rime
Control and Prevention District.
Authorized Selling Group - Primary dealer and regional firms that have been selected by the
underwriter to sell their securities. Each authorized member of a selling group will offer the issue at
the price authorized by the governmental agency.
Qualified Representative - A person who holds a position with a business organization, who is
authorized to act on behalf of the business organization, and who is one of the following:
(A) for a business organization doing business that is regulated by or registered with a
securities commission, a person who is registered under the rules of the National
Association of Securities Dealers;
(B) for a state or federal bank, a savings bank, or a state or federal credit union, a member
of the loan committee for the bank or branch of the bank or a person authorized by
corporate resolution to act on behalf of and bind the banking institution; or
(C) for an investment pool, the person authorized by the elected official or board with
authority to administer the activities of the investment pool to sign the written
instrument on behalf of the investment pool.
IV. INVESTMENT OBJECTIVES
A. Preservation and Safety of Principal
Investments of the City shall be undertaken in a manner that seeks to ensure the
preservation of capital in the overall Investment Portfolio.
B. Liquidity
The City's Investment Portfolio must be structured in a manner which maintains the
liquidity necessary to pay obligations as they become due. Sufficient cash flows must
be maintained by rapidly depositing monies and timing disbursements. Generally,
Investments are matched to specific cash flow requirements such as payrolls, debt
service payments, and other payables. Liquidity is also achieved by investing in
investments with active secondary markets or in Local Government Pools with stable
net asset values.
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It is imperative that the Investment Portfolio and Excess Cash Balances be protected
with sufficient Collateral at 102% of current market values so that monies are
available as needed.
C. Return on Investments
The City's Investment Portfolio shall be designed with the objective of regularly
exceeding the average yield of the three-month U.S. Treasury bill in a manner
consistent with the principles of this policy described in W. A and B above.
However, it must be recognized that during a bear market, satisfying this objective
may not be practical until Investments mature and can be re -invested.
For bond issues to which arbitrage restrictions apply, the primary objectives shall be
to obtain satisfactory market yields and to minimize the costs associated with
investing such monies.
D. Diversification
Diversification is required because of differing liquidity needs of the City and is
employed as a way to control risk. Diversification minimizes the risk to the overall
Investment Portfolio of potential losses on individual Securities and enhances the
safety of the Investment Portfolio.
Through the solicitation of competitive proposals, the City shall allocate and diversify
its investments through various Institutions. The following types of investments will
be solicited from the following types of institutions:
1. Government Securities - through approved brokers
2. Repurchase Agreements - through a Third Party Safekeeping Institution
Agreement which includes an approved primary dealer
3. Public Funds Investments Pools - through participation agreements
4. Certificates of Deposit - through approved local banks
The City recognizes that investment risks can result from default risk and market price
risks due to various technical and fundamental economic factors, and other
complications, leading to temporary illiquidity.
To control market price risks, volatile investments shall be avoided. To control
default risk, the only acceptable method of payment will be on a "delivery versus
payment" basis for all transactions, except investment pool funds and repurchase
agreements.
"Delivery versus Payment" Tla md111„1 provides for payment to Institutions at the
time the Investments are recorded in book entry form at the City's Third Party
Safekeeping Institution, currently maintained at the Federal Reserve. For certificates
of deposit, sufficient Collateral at 102% of current market values must be pledged to
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protect all City monies or monies under its control that exceed Federal Deposit
Insurance Corporation (FDIC) coverage; the Collateral must be safekept at a Third
Party Safekeeping Institution not affiliated with the bank or bank holding company
providing the certificate of deposit.
V. AUTHORIZED INVESTMENTS AND MAXIMUM TERM
The City of Corpus Christi is authorized to invest in:
A. Authorized Investments
t Obligations of the United States or its agencies and instrumentalities which currently
include:
1. it ,Short-term [LS. Treasuries:
a.(1) U.S. Treasury Bills
b.(2) U.S. Treasury Coupon Notes
c.(3) U.S. Trcasury Slips (Inl.,rest O.dy)
Maximum Term
up to 365 days
up to 3 years
up to 3 yvatS
c. d.(4)
2. it U.S.
a.(+)
b.(2)
c.(3)
d.(d)
e.(5)
U.S. Treasury Notes and Strips up to 3 years*
*see Section V.B.3.
Agencies: Maximum Term
Federal Home Loan Bank up to 2 years
Federal National Mortgage Association. up to 2 years
Federal Farm Credit up to 2 years
Federal Home Loan Mortgage Corporation. up to 2 years
Student Loan Marketing Association. up to 2 years
3. r. Repurchase Agreementq up to 365 days
Repurchase agreements fully collateralized at 102% with a defined
maturity date placed with a primary government dealer and safekept
at a Third Party Safekeeping Institution, as provided under the
provisions of the PSA (Pubic Securities Association) master
repurchase agreement. An executed agreement between the City,
primary government dealer, and Third Party Safekeeping Institution
will be on file before the City will enter into a tri -party repurchase
agreement.
Weekly monitoring by the City's Investment Officers of all Collateral
underlying repurchase agreements is required. More frequent
monitoring may be necessary during periods of market volatility.
Reverse repurchase agreements are not a permitted Investment.
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4. ± Local Government Investment Pool daily
Investments made on behalf of the City by a public funds investment
pool duly created to function as a money market mutual fund who
marks its portfolio to market daily and, to the extent reasonably
possible, who stabilizes its portfolio to market daily and, to the extent
reasonably possible, who stabilizes its portfolio at a $1 net asset value.
If the ratio of the market value of the Pool's portfolio divided by the
book value of the portfolio is less than 99.50% or greater than
100.50%, the Pool's portfolio holdings shall be sold as necessary to
maintain the ratio between 99.50% and 100.50%.
The public funds investment pool must be continuously rated no lower
than AAA or AAA -m or at an equivalent rating by at least one
nationally -recognized rating service (see the attacicd and in..oiyoratcd
Appendix C) with a weighted average maturity no greater than 90
days.
5. e r up to l year
Certificates of deposit or other instruments issued by state and
national banks domiciled in Texas that are:
a.+ guaranteed or insured by the Federal Deposit Insurance
Corporation or its successor; or
a.2 secured by obligations that are described by Section V,
Subdivision A.1(a) and A.1(b).
Certificates of deposit must be fully collateralized at 102% of their
market value.
The City requires the bank to pledge U.S. Treasuries or U.S. Agencies
as collateral. (Collateral Mortgage Obligations will rat be eligible as
Collateral -see X.C.) as Collateral. The Investment Officers will
monitor adequacy of collateralization on a weekly basis.
11. Weighted Average Maturity
In order to minimize risk of loss to the Investment Portfolio due to interest rate
fluctuations, Investment maturities will not exceed the anticipated cash flow
requirements of the Funds. Maturity guidelines by Fund are as follows:
The maximum term for any Investment other than Reserve Funds is three years. The
weighted averaged days to maturity shall be less than 365 days for Investments, other
than Reserve Funds.
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1. Operating Funds
The weighted average days to maturity of Investments, other than Reserve
Funds, shall be less -than 365 days or less. The Investment Officers will
monitor the maturity level and make changes as appropriate.
2. Capital Improvement Funds
(Bond Proceeds, Bond Reserves, Debt Service)
The investment maturity of that portion of the City Portfolio that represents
Capital Improvement Funds (bond proceeds, reserve funds, and debt service)
shall be determined considering:
a. The anticipated cash flow requirements of the Capital Improvement
Funds; and
b. The "temporary period" as defined by Federal tax law during which
time bond proceeds may be invested at an unrestricted yield. After the
expiration of the temporary period, bond proceeds subject to yield
restriction shall be invested considering the anticipated cash flow
requirements of the Capital Improvement Funds.
Before an Investment can be made of bond proceeds from all bond issues
affected by the Tax Reform Act of 1986, a careful yield analysis must be
performed to comply with the Tax Reform Act. Also, an annual rebate
calculation must be performed to determine if the City is required to rebate
interest at the end of each respective bond issue's five-year term.
Beginning on the anniversary of the third year for the respective bond issues,
all bond proceeds will be yield restricted as required by the Tax Reform Act.
3. Reserve Funds: Established by Operative Bond Funds or by the City
Council
The following Reserve Funds may be invested up to seven years in U.S. Treasuries:
Maximum
Fund 148 Choke Canyon $2,000,000
Fund 300 Debt Service $4,000,000
Fund 445 Utility Refunding $5,975,000
City monies governed by this Policy may not be invested in other investments
permitted by law unless (i) such investments are specifically authorized for the
investment of these monies by an ordinance adopted by the City Council issuing bonds
or other debt obligations or (ii) this Policy is amended to permit such investment.
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r_
C. Methods to Monitor Investment Market Price
The City monitors the market price of investments by obtaining this information from
the Bloomberg system or the Tele -Rate system which are made available through the
City's authorized institutional brokers. The City may also obtain market price
information from other nationally recognized sources of financial information such as
the Wall Street Journal.
VL INVESTMENT MIX AND STRATEGIES
A. Investment Mix
As a target to ensure adequate liquidity, the Investment Portfolio administered by the
Investment Officers should consist of at least 25% in U.S. Treasury Securities
described in V.A.1.a. A minimum of 15% of the total Investment Portfolio shall be
held in Investments with maturity dates of 90 days or less for liquidity. U.S.
Treasuries/Agencies may be purchased for longer term maturities (greater than one
year) but shall not exceed 40% of the total Investment Portfolio to preserve liquidity.
Daily investment reports shall specifically address whether stated investment mix
requirements are being met. Unless approved by the Investment Advisory Committee,
the target percentages specified shall not be exceeded for temporary periods greater
than thirty (30) days without the Investment Officers taking corrective action.
B. Strategies
Investment strategies for Operating Funds and Capital Improvement Funds Cc.1e.4t
Operating FunJa and Build Fatah have as their primary objective the assurance that
anticipated cash flows are matched with adequate investment liquidity. The secondary
objective is to create an Investment Portfolio structure which will experience minimal
volatility during economic cycles. To accomplish this strategy, the City will purchase
high quality, short -to -medium-term investments which will compliment each other.
To pay for anticipated disbursements, investments will be laddered to correspond with
the projected cash needs of the City. Some Investments are acquired on the short end
of the yield curve (90 days or less) to meet immediate cash needs. A few investments
are purchased on the intermediate part of the yield curve (1-3 years) to lock in higher
interest rates when rates are projected to decline due to the economic cycle of the
economy. The dollar weighted average investment maturity of 365 days or less will
be calculated using the stated final maturity dates of each investment.
Investment strategies for debt service funds shall have as the primary objective the
assurance of investment liquidity adequate to cover the debt service obligation on the
required payment date. Investments purchased shall not have a stated final maturity
date that exceeds the debt service payment date.
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Investment strategies for debt service reserve funds shall have as the primary objective
the ability to generate a dependable revenue stream to the appropriate debt service
fund from investments with a low degree of volatility. In accordance with the bond
ordinance specific to an individual bond issue which sets out the maximum investment
term, Investments should be of high quality, with short -to -intermediate-term
maturities.
Investment strategies for Special Purpose Funds will have as their primary objective
the assurance that anticipated cash flows are matched with adequate Investment
liquidity. These investment portfolios shall include highly liquid investments to allow
for flexibility and unanticipated project outlays. The stated final maturity dates of
Investments held shall not exceed the estimated project completion date.
C. Achieving Investment Return Objectives
Investment selection shall be based on legality, appropriateness, liquidity, and
tisk/return considerations. Monies designated for immediate expenditure should be
passively invested.
Passive investment provides for:
a.T. Liquidity to pay upcoming disbursements (payroll, debt service, payments,
payables, etc.);
b.2. Maximizing investment terms under the current budget; and
c.3. Structuring the Investment Portfolio on a "laddered" basis.
The remaining portion of the Investment Portfolio may be invested actively and the
reasons for doing so, are:
Active investment provides for:
a.t. The ability to improve yields in the Investment Portfolio by riding the yield
curve during business cycle recovery and expansion periods. Interest rates on
longer maturities typically exceed those on shorter maturities. Therefore,
longer maturities (that can be held to maturity, if necessary) are purchased in
anticipation of selling later at the same Dr lower interest rate, improving the
total return during the holding period.
b.%. The ability to improve market sector diversification by swapping out of one
investment into another for a better total return, to realign for disbursement
projections rates-, or to extend or shorten maturity depending on economic
forecasts.
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The City Manager, or his designee, is required to approve any investment that
must be sold at a loss. All gains and losses will be reported to the City
Council and Investment Committee on a quarterly basis.
VII. RESPONSIBILITY AND CONTROLS
A. Authority to Invest
The authority to invest City funds and the execution of any documentation necessary
to evidence the investment of City funds is granted to the Director of Finance. The
City Treasurer and the Investment Analyst are the designated Investment Officers
responsible for the daily operation of the investment program. All investments will
be approved in writing by the Director of Finance or Designee (excluding Investment
Officers).
B. Establishment of Internal Controls
The City Treasurer will establish a system of internal controls over the Investment
activities of the City and document such controls in the Investment Procedures
Manual. These internal controls shall be approved by the Director of Finance.
C. Prudent Investment Management
Investments shall be made with the same judgment and care, under prevailing
circumstances, that a person of prudence, discretion, and intelligence would exercise
in the management of the person's own affairs, not for speculation, but for
investment, considering the probable safety of capital and the probable income to be
derived. Prudent investment is to be judged by the Investment Portfolio as a whole,
not on individual Investments. If liquidation is necessary due to a pool losing its AAA
rating or for other reasons, liquidation will be done in a prudent manner consistent
with the investment objectives of this policy and as provided in 2256.021 of the
Government Code. Investment of monies shall be governed by the following
investment objectives in order of priority:
1. preservation and safety of principal;
2. liquidity; and
3. yield.
The designated Investment Officers shall perform their duties in accordance with the
adopted Investment Policy and Procedures set forth in the Investment Procedures
Manual. Investment Officers acting in good faith and in accordance with these
policies and procedures shall be relieved of personal liability. The Investment
Committee and Officers are indemnified as provided by City Ordinance attached and
incorporated as Appendix E.
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D. Standards of Ethics
The Investment Committee and City Treasurer will comply with the City's Code of
Ethics Ordinance attached and incorporated as Appendix D which requires disclosure
of financial interests by April of each year.
The designated Investment Officers and all members of the Investment Committee
shall adhere to the City's Ethics Ordinance. To the extent required by section
2256.005(i) of the Government Code, the Investment Committee and City Treasurer
shall make such filings as required by law.
E. Training and Education
Recognizing that the training and education of Investment Officers contributes to
efficient and effective investment management, the City requires its Investment
Officers to obtain appropriate professional training. Such training is currently
required by, and shall be obtained in accordance with Section 2256.008 of the
Government Code Public Funds Investment Act. The Investment Committee
approves investment training seminars presented by the following organizations:
Government Finance Officers Association
Govemment Finance Officers Association of Texas
Government Treasurers Organization of Texas
Municipal Treasurers Association
Texas Municipal League
VIII. COMPETITIVE SOLICITATION
Except for repurchase agreements and public funds investment pools , any new issue investment will
be purchased through an Authorized Selling Group or directly through the issuer.
For any Invest<uent purchased or sold through the secondary market, the City will obtain at least three
proposals from Authorized Institutions.
Any Institution that wial.co authorized to participate in the City's investment program must meet
Collateral pledge requirements outlined in Section FV7D. X. of these guidelines and must submit
annual financial reports. t aH ,. pu. la u.. a yuan k.ly Lcw.b Ly tl.c 15tl. Jay eq
dater
DC. AUTHORIZED INSTITUTIONS
All institutions who seek to sell an authorized Investment to the City are required to complete the
questionnaire ,, . , - 1 td . n . • I : . ;111;01 approved by the Investment Committee and
furnish supporting documentation required by the Investment Committee. Securities shall only be
purchased through those Institutions approved by the Investment Committee.
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A. Investments shall only be made with those Institutions who have executed a written
instrument in a form acceptable to the City, executed by a Qualified Representative
of the Institution, and substantially to the effect that the Institution has:
1. Received, thoroughly reviewed and acknowledged, in writing, receipt
and understanding of the City's Investment Policy, and;
2. Acknowledged that the Institution has implemented reasonable
procedures and controls in an effort to preclude investment
transactions conducted between the Institution and the City that are
not authorized by the City's Investment Policy.
B. Investments shall only be made with those Institutions who have met the qualifications
and standards established by the City's Investment Committee and set forth in the
Investment Procedures Manual.
C. The Investment Committee shall, at least annually, review, revise, and adopt a list of
qualified brokers that are authorized to engage in investment transactions with the
City.
D. The City Treasurer will request the Investment Committee to authorize deletion of
Institutions for:
1. Slow response time;
2. Less than competitive pricing;
3. Little or no information on technical or fundamental expectations based on
economic indicators;
4. Decayed Transactions or continuing operational difficulties; or
5. Unwillingness to continue to abide the provisions listed in IX.A.
X. PLEDGED COLLATERAL
The market value of pledged collateral must be 102% of the principal plus accrued interest for Excess
Cash Balances, certificates of deposit, and repurchase agreements. Evidence of proper
collateralization in the form of original safekeeping receipts held at a Third Party Safekeeping
Institution not affiliated with the Institution pledging the collateral will be approved by the City
Treasurer and will be maintained in the City's Treasurer Office. An authorized City Representative
(See Appendix 13) will approve and release all pledged collateral.
A. Collateral Substitution
Collateralized investments and certificates of deposit often require substitution of
collateral. Any Institution must contact the Investment Officers for approval and
settlement. The substituted collateral's value will be calculated and substitution
approved if its value is equal to or greater than the required collateral value.
14
Substitution is allowable for all. transactions, but should be limited, to minimize the
City's potential administrative problems.
B. Collateral Reductions
Should the collateral's market value exceed the required amount, any Institution may
request approval from the Investment Officer to reduce collateral. Collateral
reductions may be permitted only if the City's records indicate that the collateral's
market value exceeds the required amount.
C. Prohibited Securities
Investment securities described in Section 2256.009(b), Government Code, shall not
be eligible for use as collateral of City monies governed by this Policy.
XI. SAFEKEEPING
A. Third Party Safekeeping Agreement
The City shall contract with a Bank or Banks for the safekeeping of Securities either
owned by the City as a part of its Investment Portfolio or held as collateral to secure
certificates of deposit, repurchase agreements, or Excess Cash Balances.
B. Safekeeping of Certificate of Deposit Collateral
All collateral securing bank and savings and loan deposits must be held by a Third
Party Safekeeping Institution approved by the City, or collateral may be held at the
Federal Reserve Bank.
C. Safekeeping of Repurchase Agreement Collateral
The U.S. Treasuries which serve as collateral for repurchase agreements with
Institutions must be delivered to a Third -Party Safekeeping Institution with which the
City has established a third -party safekeeping agreement.
XII. WIRE AND ELECTRONIC SERVICES
Wire and electronic services are to be provided as referenced in the City's Depository Services
agreement, portions of which are attached and incorporated as Appendix F E.
The City rebids the depository agreement every three to five years and the applicable terms of any
new depository agreement will be incorporated as it fully set out herein, Appendix F will be updated
every time a depository agreement is authorized by the City Council.
15
XIII. INFORMATION REPORTING/EVALUATION
The City Treasurer and Investment Analyst are hereby designated as the Investment Officers and are
responsible for the daily operation of the Investment program and will report to the Investment
Committee on a quarterly basis.
A. Investment Committee
The investment committee consists of:
City Manager
Assistant City Managers
Director of Finance
City Attorney
Director of Management and Budget.
The Investment Committee will be responsible for monitoring, reviewing, and making
recommendations regarding the City's Investment program to the City Council. Reports will
be provided to the City Council by the Investment Officers no less than quarterly, as required
by the Public Funds Investment Act.
B. Internal Reporting/Evaluation
The following reports are to be submitted on a:
1. Daily basis to the Director of Finance or Designee (Excluding Investment
Officers):
a. Cash Position by Bank Account
b. Collateral Position Lavcatiacnt Portfvlio by Maturity Dat.,, Svhc,luk.
of Livcataua.ut Put Limaa.s/Matuailies
c. Investment Portfolio (Including Purchases/Maturities)
2. Demand Generated Reports M„nth1y Basis to the Investment Committee:
a. Report of Cash and Investments by Fund
b. Interest Report
aaucauluwul LI l the By-Iawa, wLL,c ua tllc aaaauuut, ycaa,cuta c, vi
Lactla0al of wu.putatauu of tlac aalaamuota stave fcc of wly pul,ln, fuuala
;and
•11 1 ... •'' .'
Market Value vs. Book Value Analysis of Investment Portfolio
3. Quarterly Reporting to Investment Committee and City Council:
a. Compliance with Public Funds Investment Act and Investment Policy;
b. Interest Report;
16
c. Investment by Institution;
d. Investment Maturities/Purchases;
e. Collateral Position;
f. Highest/Lowest Interest Yields;
g. Investment Survey;
h. Analysis of Gains/(Losses) on Sale of Securities;
i. Market Values vs. Book Values of Investment Portfolio;
j. Public Investor's Interest Rate Outlook; and
k. Summary.
C. External Reporting/Evaluations
On a quarterly basis, the City's main depository and all applicable Institutions
providing certificates of deposit in excess of FDIC coverage will provide to the
Investment Officer for review a copy of the balance sheet and income statement for
the Call Report. All Institutions will provide annual audited financial statements. Any
local government investment pools must provide reports and disclosure statements as
required by the Public Funds Investment Act.
D. Record Retention
The City follows the guidelines of retaining records fvr scvcd yeas f.o.,i C.ty's
t,ur,c„ t fig, �l ycal , as recommended in the Texas State Library Municipal Records
Manual or may be authorized by the City's local records management guidelines.
XIV. BANKING SERVICES
All depository services are provided in the City's main depository agreement. Other services such
as credit cards, direct deposit of payroll, or other services may be administered through separate
agreements. To aggressively invest Excess Cash Balances, controlled disbursements accounts, zero
balance accounts, and other cash management tools may be employed.
XV. GENERAL PROVISIONS
A. Audits and Inspections. During regular business hours and as often as the
Investment Officers deem necessary, the Institution providing certificates of deposit
will make available for examination by the City Manager, his duly authorized agent,
accountant, or legal representative such records and data to assure the pledge of
collateral, availability of collateral, and financial stability of the Institution.
B. Compliance with Laws. Each Institution agrees to comply with all federal, state,
and local laws, rules, regulations, and ordinances. The personnel or officers of such
Institution, shall be fully qualified and authorized under federal, state, and local law
to perform the services set out under this Policy. Each Institution shall permit the
Investment Officers to audit, examine, and make excerpts or transcripts from such
17
records and to make audits of all contract, invoices, materials, and other data relating
to applicable Investments.
C. Performance Audits. The City's Annual External Financial Audit shall include a
compliance audit of management controls on Investments and adherence to this
Policy. If the City invests in other than money market mutual funds, investment
pools or accounts offered by its depository in the form of certificates of deposit or
money market accounts, the quarterly reports prepared by Investment Officers for the
City Council must be formally reviewed at least annually by an independent auditor.
The results of the review must be reported to the City Council by that auditor.
D. Investment Policy Resolution. The resolution authorizing this Investment Policy is
attached and incorporated as Appendix 6 F "Investment Policy Resolutions."
18
APPENDIX A
Public Fund Investment Act, Section 2256
City of
Corpus
Christi
APPENDIX A
TEX. GOV'T CODE § 2256.001 (1998) printed in FULL format.
TEXAS STATUTES AND CODES
*** THIS DOCUMENT IS CURRENT THROUGH THE 1998 SUPPLEMENT (1997
SESSION) ***
GOVERNMENT CODE
TITLE 10. GENERAL GOVERNMENT
SUBTITLE F. STATE AND LOCAL CONTRACTS AND FUND MANAGEMENT
CHAPTER 2256. PUBLIC FUNDS INVESTMENT
SUBCHAPTER A. AUTHORIZED INVESTMENTS FOR GOVERNMENTAL ENTITIES
Tex. Gov't Code § 2256.001 (1998)
5 2256.001. Short Title
This chapter may be cited as the Public Funds Investment Act.
§ 2256.002. Definitions
In this chapter:
(1) "Bond proceeds" means the proceeds from the sale of bonds, notes,
and other obligations issued by an entity, and reserves and funds
maintained by an entity for debt service purposes.
(2) "Book value" means the original acquisition cost of an investment
plus or minus the accrued amortization or accretion.
(3) "Funds" means public funds in the custody of a state agency or
local government that:
(A) are not required by law to be deposited in the state treasury;
and
(B) the investing entity has authority to invest.
(4) "Institution of higher education" has the meaning assigned by
Section 61.003, Education Code.
(5) "Investing entity" and "entity" mean an entity subject to this
chapter and described by Section 2256.003.
(6) "Investment pool" means an entity created under this code to invest
public funds jointly on behalf of the entities that participate in the
pool and whose investment objectives in order of priority are:
(A) preservation and safety of principal;
(B) liquidity; and
(C) yield.
(7) "Local government" means a municipality, a county, a school
district, a district or authority created under Section 52(b) (1) or
(2), Article III, or Section 59, Article XVI, Texas Constitution, a
fresh water supply district, a hospital district, and any political
19
TEX. GOV'T CODE § 2256.002 (1998)
subdivision, authority, public corporation, body politic, or
instrumentality of the State of Texas, and any nonprofit corporation
acting on behalf of any of those entities.
;8) "Market value" means the current face or par value of an investment
multiplied by the net selling price of the security as quoted by a
recognized market pricing source quoted on the valuation date.
(9) "Pooled fund group' means an internally created fund of an
investing entity in which one or more institutional accounts of the
investing entity are invested.
(10) "Qualified representative" means a person who holds a position
with a business organization, who is authorized to act on behalf of the
business organization, and who is one of the following:
(A) for a business organization doing business that is regulated by
or registered with a securities commission, a person who is
registered under the rules of the National Association of Securities
Dealers;
(B) for a state or federal bank, a savings bank, or a state or
federal credit union, a member of the loan committee for the bank or
branch of the bank cr a person authorized by corporate resolution to
act on behalf of and bind the banking institution; or
(C) for an investment pool, the person authorized by the elected
official or board with authority to administer the activities of the
investment pool to sign the written instrument on behalf of the
investment pool.
(11) "School district" means a public school district.
(12) "Separately invested asset" means an account or fund of a state
agency or local government that is not invested in a pooled fund group.
(13) "State agency" means an office, department, commission, board, or
other agency that is part of any branch of state government, an
institution of higher education, and any nonprofit corporation acting
on behalf of any of those entities.
§ 2256.003. Authority to Invest Funds; Entities Subject to this Chapter
Each governing body of the following entities may purchase, sell, and invest
its funds and funds under its control in investments authorized under this
subchapter in compliance with investment policies approved by the governing body
and according to the standard of care prescribed by Section 2256.006:
(1) a local government;
(2) a state agency;
(3) a nonprofit corporation acting on behalf of a local government or a
state agency; or
(4) an investment pool acting on behalf of two or more local governments,
state agencies, or a combination of those entities.
20
§ 2256.004. Applicability
This subchaf does not apply to:
il) a public retirement system as defined by Section 802.001;
(2) state funds invested as authorized by Section 404.024;
(3) an institution of higher education having total endowments of at
least $ 95 million in book value on May 1, 1995;
(4) funds invested by the Veterans' Land Board as authorized by Chapter
161, i62, or 164, Natural Resources Code; or
(5) registry funds deposited with the county or district clerk under
Chapter 117, Local Government Code.
(5) a deferred compensation plan that qualifies under either Section
401(k) or 457 of the Internal Revenue Code of 1986 (26 U.S.C. Section 1
et seq.), as amended.
§ 2256.005. Investment Policies; Investment Strategies; Investment Officer
(a) The governing body of an investing entity shall adopt by rule, order,
ordinance, or resolution, as appropriate, a written investment policy regarding
the investment of its funds and funds under its control.
(b) The investment policies must:
(1) be written;
(2) primarily emphasize safety of principal and liquidity;
(3) address investment diversification, yield, and maturity and the
quality and capability of investment management; and
(4) include:
(A) a list of the types of authorized investments in which the
investing entity's funds may be invested;
(B) the maximum allowable stated maturity of any individual
investment owned by the entity;
(C) for pooled fund groups, the maximum dollar -weighted average
maturity allowed based on the stated maturity date for the portfolio;
(D) methods to monitor the market price of investments acquired with
public funds; and
(E) a requirement for settlement of all transactions, except
investment pool funds and mutual funds, on a delivery versus payment
basis.
(c) The investment policies may provide that bids for certificates of deposit
be solicited:
(1) orally;
(2) in writing;
21
Page 5
TEX. GOVT CODE § 2256.005 (1998)
'h) An officer or employee of a commission created under Chapter 391, Local
Government Code, is ineligible to be designated as an investment officer under
Subsection (f) for any investing entity ocher than for that commission.
'§ i) An investment officer of an entity who has a personal business
reiat_cnship with a business organization offering to engage in an investment
transaction with the entity shall file a statement disclosing that personal
business interest. An investment officer who is related within the second degree
by affinity or consanguinity, as determined under Chapter 573, to an individual
seeking to sell an investment to the investment officer's entity shall file a
statement disclosing that relationship. A statement required under this
subsection must be filed with the Texas Ethics Commission and the governing body
of the entity. For purposes of this subsection, an investment officer has a
personal business relationship with a business organization if:
(1) the investment officer owns 10 percent or more of the voting stock
or shares of the business organization or owns $ 5,000 or more of the
fair market value of the business organization;
,2) funds received by the investment officer from the business
organization exceed 10 percent of the investment officer's gross income
for the previous year; or
(3) the investment officer has acquired from the business organization
during the previous year investments with a book value of $ 2,500 or
more for the personal account of the investment officer.
(1) The governing body of an investing entity may specify in its investment
policy that any investment authorized by this chapter is not suitable.
(k) A written copy of the investment policy shall be presented to any person
offering to engage in an investment transaction with an investing entity. For
purposes of this subsection, a business organization includes investment pools.
Nothing in this subsection relieves the investing entity of the responsibility
for monitoring the investments made by the investing entity to determine that
they are in compliance with the investment policy. The qualified representative
of the business organization offering to engage in an investment transaction
with an investing entity shall execute a written instrument in a form acceptable
to the investing entity and the business organization substantially to the
effect that the business organization has:
(1) received and reviewed the investment policy of the entity; and
(2) acknowledged that the business organization has implemented
reasonable procedures and controls in an effort to preclude investment
transactions conducted between the entity and the organization that are
not authorized by the entity's investment policy, except to the extent
that this authorization is dependent on an analysis of the makeup of
the entity's entire portfolio or requires an interpretation of
subjective investment standards.
(1) The investment officer of an entity may not acquire or otherwise obtain
any authorized investment described in the investment policy of the investing
22
TEX. GOVT CODE § 2256.005 (1998)
(3) electronically; or
Page 4
(4) in any combination of those methods.
s
id) As an integral part of an investment policy, the governing body shall
adopt a separate written investment strategy for each of the funds or group of
funds under its control. Each investment strategy must describe the investment
objectives for the particular fund using the following priorities in order of
importance:
(1) understanding of the suitability of the investment to the financial
requirements of the entity;
i2) preservation and safety of principal;
(3) liquidity;
(4) marketability of the investment if the need arises to liquidate the
investment before maturity;
(5) diversification of the investment portfolio; and
(6) yield.
(e) The governing body of an investing entity shall review its investment
policy and investment strategies not less than annually. The governing body
shall adopt a written instrument by rule, order, ordinance, or resolution
stating that it has reviewed the investment policy and investment strategies and
that the written instrument so adopted shall record any changes made to either
the investment policy or investment strategies.
(f) Each investing entity shall designate, by rule, order, ordinance, or
resolution, as appropriate, one or more officers or employees of the state
agency, local government, or investment pool as investment officer to be
responsible for the investment of its funds consistent with the investment
policy adopted by the entity. Authority granted to a person to invest an
entity's funds is effective until rescinded by the investing entity or until
termination of the person's employment by the investing entity. In the
administration of the duties of an investment officer, the person designated as
investment officer shall exercise the judgment and care, under prevailing
circumstances, that a prudent person would exercise in the management of the
person's own affairs. Unless authorized by law, a person may not deposit,
withdraw, transfer, or manage in any other manner the funds of the investing
entity.
(g) Subsection (f) does not apply to a state agency, local government, or
investment pool for which an officer of the entity is assigned by law the
function of investing its funds.
(h) An officer or employee of a commission created under Chapter 391, Local
Government Code, is ineligible to be an investment officer for the commission
under Subsection (f) if the officer or employee is an investment officer
designated under Subsection (f) for another local government.
23
Page 6
TEX. GOVT CODE § 2256.005 (1998)
entity from a person who has not delivered to the entity the instrument required
by Subsection (k).
(m) An investing entity, :n conjunction with its annual financial audit,
shall perform a compliance audit of management controls on investments and
adherence to the entitv's established investment policies. State agencies
'§shall report the results of the audit performed under this subsection to the
state auditor. The state auditor shall compile the results of reports received
under this subsection and annually report those results to the legislative audit
committee.
2256.33,6. 2tandard of Care
(a) Investments shall be made with judgment and care, under prevailing
ircumstances, that a person of prudence, discretion, and intelligence would
xercise_n the management of the person's own affairs, not for speculation, but
or investment, considering the probable safety of capital and the probable
ncome to be derived. Investment of funds shall be governed by the following
nvestment objectives, in order of priority:
(1)
Tex. Gov't Code @ 2256.006 (1998) =8=
preservation and safety of principal;
(2) liquidity; and
(3) yield.
(b) In determining whether an investment officer has exercised prudence with
respect to an investment decision, the determination shall be made taking into
:onsideration:
(1) the investment of all funds, or funds under the entity's control,
over which the officer had responsibility rather than a consideration
as to the prudence of a single investment; and
(2) whether the investment decision was consistent with the written
investment policy of the entity.
Tex. Gov't Code 8 2256.007 (1998) =8=
training under this section.
(c) Training under this section must include education in investment
controls, security risks, strategy risks, market risks, and compliance with this
chapter.
(d) An investment officer shall attend a training session not less than once
in a two-year period and may receive training from any independent source
approved by the governing body of the state agency. The investment officer shall
prepare a report on this subchapter and deliver the report to the governing body
of the state agency not later than the 180th day after the last day of each
regular session of the legislature.
@ 2256.007. Investment Training; State Agency Board Members and Officers
(a) Each member of the governing board of a state agency and its investment
officer shall attend at least one training session relating to the person's
responsibilities under this chapter within six months after taking office or
\ssuminq duties.
(b) The Texas Higher Education Coordinating Board shall provide the
24
2256.000
-::vest^,enc Training: Local 5overnments
(aThe treasurer, 2h let financial officer if the treasurer is not the
-lief r Wanda_ ___icer, the investment officer of a local government shall:
attend at _east One training session relating to the treasurer's or
officer's responsibilities under this subchapter within 12 months after
taking rffioe or assuming duties; and
Tex. Gov't Code @ 2256.008 (1998)
=cent _. =vestment training session not less than once -n a
two -near re and receive not less than 10 hours of instruction
_e!at:na oo _n._stment responsibilities 'under this subchapter from an
independent acurce approved by the governing body of the local
government or a designated investment committee advising the investment
officer as provided for in the investment policy of the local
government.
(b) Training under this section must include education in investment
sontrols, security risks, strategy risks, market risks, and compliance with this
shapter.
? 2256.009. Authorized Investments: Obligations of, or Guaranteed by
governmental Entities
(a) Except as provided by Subsection (b), the following are authorized
nvestments under this subchapter:
(1) obligations of the United States or its agencies and
instrumentalities:
Tex. Gov't Code @ 2256.009 (1998) =8=
(2) direct obligations of this state or its agencies and
instrumentalities;
(3) collateralized mortgage obligations directly issued by a federal
agency or instrumentality of the United States, the underlying security
for which is guaranteed by an agency or instrumentality of the United
States;
(4) other obligations, the principal and interest of which are
unconditionally guaranteed or insured by, or backed by the full faith
and credit of, this state or the United States or their respective
agencies and instrumentalities; and
(5) obligations of states, agencies, counties, cities, and other
political subdivisions of any state rated as to investment quality by a
nationally recognized investment rating firm not less than A or its
equivalent.
(b) The following are not authorized investments under this section:
(1) obligations whose payment represents the coupon payments on the
Tex. Gov't Code @ 2256.009 (1998)
outstanding principal balance of the underlying mortgage-backed
security collateral and pays no principal;
(2) obligations whose payment represents the principal stream of cash
flow from the underlying mortgage-backed security collateral and bears
no interest;
(3) collateralized mortgage obligations that have a stated final
maturity date of greater than 10 years; and
(4) collateralized mortgage obligations the interest rate of which is
determined by an index that adjusts opposite to the changes in a market
index.
25
..n_________ ,iaoos '.n autnorizea investment _.is succr.acter If
r.e cert:__cat=_�is Issued _tate sr national bank domrc:_ea In tnis state,
tvincs hank _tmic±Lea in tn15 state, '.,r a state or _federal credit onion
_*,loll._ fn state and __:
Tex. Csv't Code @ 2256.010 (1998)
-.. 8ea '--.s'area L. Inc Federal :eposat Insurance Iorporeocon
=__sor cr the Nacional 3realt _don Share in__rance Fund or
'2, _ ecligations _..at are described by Section 2256.009(a),
'" -crtgage backed securities directly issued t a federal
agency t_ Instrumentality that have a market value of not Less than the
orinc pal amount of the certificates, but excluding those mortgage
'oacx' -----'-es of the nature described by Section 2256.009(6); or
3) s -r -'•-ed in an other manner and amount provided by law for deposits
of the investing entity.
2256.311. Authorized Investments: Repurchase Agreements
a) A fzily collateralized repurchase agreement is an authorized investment
_rider this subchapter if the repurchase agreement:
•_, :_ a __fined termination date;
ed ty obligations described y Section 2256.309(a) (1',; and
Tex. Gov't Code @ 2256.011 (1998)
(3) requires the securities being purchased by the entity to be pledged
to the entity, held in the entity's name, and deposited at the time the
investment is made with the entity or with a third party selected and
approved by the entity; and
(4) is placed through a primary government securities dealer, as
defined by the Federal Reserve, or a financial institution doing
business in this state.
(b) In :his section, "repurchase agreement" means a simultaneous agreement to
:uy, hold for a specified time, and sell back at a future date obligations
iescribed by Section 2256.009(a)(1(, at a market value at the time the funds are
'_isbursed of not less than the principal amount of the funds disbursed. The term
includes a direct security repurchase agreement and a reverse security
repurchase agreement.
(c) Notwithstanding any other law, the term of any reverse security
repurchase agreement may not exceed 90 days after the date the reverse security
repurchase agreement is delivered.
(d) Money received by an entity under the terms of a reverse security
Tex. Gov't Code @ 2256.011 (1998) =B=
repurchase agreement shall be used to acquire additional authorized investments,
cut the term of the authorized investments acquired must -.azure not later than
the expiration date stated in the reverse security repurchase agreement.
26
Investments; 3anKer's Acceptances
bankers'. :_ceotance n authorized investment under :his subchapter if
ne banker_' . _zeptance:
1) :.:s _ _-acea maturity of 270 days or fewer from the Date of its
_ssuanrc;
Tex. Gov't Code 9 2256.012 1998)
accordance with _-s terms, liquidated in _full at
maturity.
collateral for borrowing from a Federal Reserve
Sank; :.-.
(4) is accepted by a bank organized and existing under the laws of the
United °'_-_= or any state, if the short-term obligations of the bank,
or of a sanK holding company of which the bank is the largest
subsidiary, are rated not less than A-1 or P-1 or an equivalent rating
by at least one nationally recognized credit rating agency.
2256.013. Authorized Investments: Commercial Paper
Commercial caper is an authorized investment under this subchapter if the
.ommercial pacer:
(1) has a stated maturity of 270 days or fewer from the date of its
issuance; _.._
Tex. Gov't Code 9 2256.013 (1998)
(2) is rated not less than A-1 or P-1 or an equivalent rating by at
least:
(A) two nationally recognized credit rating agencies; or
(B) one nationally recognized credit rating agency and is fully
secured by an irrevocable letter of credit issued by a bank organized
and existing under the laws of the United States or any state.
3 2256.014. Authorized Investments: Mutual Funds
(a) A :o -load money market mutual fund is an authorized investment under this
subchapter if the mutual fund:
(1) is registered with and regulated by the Securities and Exchange
Commission;
Tex. Gov't Code @ 2256.014 (1998) =B=
(2) provides the investing entity with a prospectus and other
information required by the Securities Exchange Act of 1934 (15 U.S.C.
Section 78a et seq.) or the Investment Company Act of 1940 (15 U.S.C.
Section 80a-1 et seg.);
(3) has a dollar -weighted average stated maturity of 90 days or fewer;
and
(4) includes in its investment objectives the maintenance of a stable
net asset value of $ 1 for each share.
(b) In addition to a no-load money market mutual fund permitted as an
authorized investment in Subsection (a), a no-load mutual fund is an authorized
investment under this subchapter if the mutual fund:
(1) is registered with the Securities and Exchange Commission;
(2) has an average weighted maturity of less than two years;
(3) is invested exclusively in obligations approved by this subchapter;
(4) is continuously rated as to investment quality by at least one
27
T (.ov't _ode @ 2256.014 1:998)
nationally recognized investment rating firm of not less than ..AA or
its eaui:aient; and
51
conforms to the requirements set forth to Sections 2256.016(b) and
(c) relating to the eligibility of investment pools to receive and
invest funds of investing entities.
..n entity is not authorized by this section to:
1) :crest in the aggregate more than 90 percent of its monthly average
f unu Valance, excluding bond proceeds and reserves and other funds held
for debt service, in money market mutual funds described in Subsection
(a) or mutual funds described in Subsection (b), either separately or
collectively;
(2) invest in the aggregate more than 15 percent of its monthly average
fund balance, excluding bond proceeds and reserves and other funds held
for debt service, in mutual funds described in Subsection (b);
(3) invest any portion of bond proceeds, reserves and funds held for
debt service, in mutual funds described in Subsection (b); or
Tex. Gov't Code @ 2256.014 (1998)
(4) invest its funds or funds under its control, including bond
proceeds and reserves and other funds held for debt service, in any one
mutual fund described in Subsection (a) or (b) in an amount that
exceeds 10 percent of the total assets of the mutual fund.
3 2256.015. Authorized Investments for State Agencies: Guaranteed Investment
Contracts
(a) A guaranteed investment contract is an authorized investment for state
agencies for bond proceeds under this subchapter if the guaranteed investment
contract:
(1) has a defined termination date;
Tex. Gov't Code @ 2256.015 (1998)
(2) is secured by obligations described by Section 2256.009(a)(1),
excluding those obligations described by Section 2256.009(b), in an
amount at least equal to the amount of bond proceeds invested under the
contract; and
(3) is pledged to the entity and deposited with the entity or with a
third party selected and approved by the entity.
(b) Bond proceeds, other than bond proceeds representing reserves and funds
maintained for debt service purposes, may not be invested under this subchapter
in a guaranteed investment contract with a term of longer than five years from
the date of issuance of the bonds.
(c) To be eligible as an authorized investment:
(1) the governing body of the entity must specifically authorize
guaranteed investment contracts as an eligible investment in the order,
ordinance, or resolution authorizing the issuance of bonds;
(2) the entity must receive bids from at least three separate providers
with no material financial interest in the bonds from which proceeds
2E
Te v't Code @ 2256.015 (1998)
were received
'3) the entity must purchase the highest yielding guaranteed investment
contract or which a qualifying bid is received;
4) the price of the guaranteed investment contract must take into
account the reasonably expected drawdown schedule for the bond proceeds
:o be invested; and
5) t.^.e provider rust certify the administrative costs reasonably
expected to be paid to third parties in connection with the guaranteed
investment contract.
2256.016. Authorized Investments: Investment Pools
(a) An entity may invest its funds and funds under its control through an
aiigible investment cool if the governing body of the entity by rule, order,
rdinance, or resolution, as appropriate, authorizes investment in the
:articular pool. An investment pool shall invest the funds it receives from
intities in authorized investments permitted by this subchapter.
Tex. Gov't Code @ 2256.016 (1998) =8=
(b) To be eligible to receive funds from and invest funds on behalf of an
antity under this chapter, an investment pool must furnish to the investment
;fficer or other authorized representative of the entity an offering circular or
:cher similar disclosure instrument that contains, at a minimum, the following
information:
(1) the types of investments in which money is allowed to be invested;
(2) the maximum average dollar -weighted maturity allowed, based on the
stated maturity date, of the pool;
(3) the maximum stated maturity date any investment security within the
portfolio has;
(4) the objectives of the pool;
(5) the size of the pool;
(6) the names of the members of the advisory board of the pool and the
dates their terms expire;
(7) the custodian bank that will safekeep the pool's assets;
Tex. Gov't Code @ 2256.016 (1998)
(8) whether the intent of the pool is to maintain a net asset value of
one dollar and the risk of market price fluctuation;
(9) whether the only source of payment is the assets of the pool at
market value or whether there is a secondary source of payment, such as
insurance or guarantees, and a description of the secondary source of
payment;
(10) the name and address of the independent auditor of the pool;
(11) the requirements to be satisfied for an entity to deposit funds in
and withdraw funds from the pool and any deadlines or other operating
policies required for the entity to invest funds in and withdraw funds
from the pool; and
(12) the performance history of the pool, including yield, average
dollar -weighted maturities, and expense ratios.
(c) To maintain eligibility to receive funds from and invest funds on behalf
of an entity under this chapter, an investment pool must _furnish to the
investment officer or other authorized representative of the entity:
29
Te Davit Code @ 2256.016 (1998)
_::vestment transaction confirmations; and
12) _ rontnly report that contains, at a minimum, the following
information:
A) the types and percentage breakdown of securities in which the
pool is Invested;
5) tn_ current average doilar-weightea maturity, based on the statea
maturity =ate, of the pool;
_.._ current percentage of the pool's portfolio in investments
-hat nave stated maturities of more than one year;
(D) the book value versus the market value of the pool's portfolio,
usinc amortized cost valuation;
(E) the size of the pool;
(F) the number of participants in the pool;
Tex. Gov't Code @ 2256.016 (1998)
(0) the custodian bank that is safekeeping the assets of the pool;
a misting of daily transaction activity of the entity
participating in the pool;
(I) the yield and expense ratio of the pool;
(J) the portfolio managers of the pool; and
(K) any changes or addenda to the offering circular.
(d) An entity by contract may delegate to an investment pool the authority to
cold legal title as custodian of investments purchased with its local funds.
(e) In this section, "yield" shall be calculated in accordance with
:egulations governing the registration of open-end management investment
:ompanies under the Investment Company Act of 1940, as promulgated from time to
:ime by the federal Securities and Exchange Commission.
(f) To be eligible to receive funds from and invest funds on behalf of an
antity under this chapter, a public funds investment pool created to function as
money market mutual fund must mark its portfolio to market daily, and, to
Tex. Gov't Code @ 2256.016 (1998) =B=
:he extent reasonably possible, stabilize at a $ 1 net asset value. If the ratio
)f the market value of the portfolio divided by the book value of the portfolio
Ls less than 0.995 or greater than 1.005, portfolio holdings shall be sold as
iecessary to maintain the ratio between 0.995 and 1.005.
(g) To be eligible to receive funds from and invest funds on behalf of an
antity under this chapter, a public funds investment pool must have an advisory
)oard composed:
(1) equally of participants in the pool and other persons who do not
have a business relationship with the pool and are qualified to advise
the pool, for a public funds investment pool created under Chapter 791
and managed by a state agency; or
(2) of participants in the pool and other persons who do not have a
business relationship with the pool and are qualified to advise the
pool, for other investment pools.
(h) To maintain eligibility to receive funds from and invest funds on behalf
)t an entity under this chapter, an investment pool must be continuously rated
•.o lower than AAA or AAA -m or at an equivalent rating by at least one nationally
:ecognized rating service.
r
30
An entity not requires to liquidate investments that were authorized
:vestments at the time or :base.
2256.018. =epeaied by Acts 1997, -5th Leg., c... 1421, 9 15, eff. Sept. 1,
7
2256.019. 'acing of Certain Investment Pools
public tunas _nvestment pool must be continuously rated no lower than AAA
.- A -m .r ._ an equivalent rating by at least one nationally recogn_zea rating
.rvice or no -ower than investment grade by at least one nationally recognized
ging o__,_c_ with a weighted average maturity no greater than 90 days.
2256.020. Authorized Investments: Institutions of Higher Education
In addit_cn to the authorized investments permitted by this subchapter, an
nstitution of higher education may purchase, sell, and invest its funds and
unds under its control in the following:
(1) cash management and fixed income funds sponsored by organizations
exempt from federal income taxation under Section 501(f), Internal
Tex. Gov't Code 9 2256.020 (1998)
Revenue Code of 1986 <=1> 26 U.S.C. Section 501(f));
(2) negotiable certificates of deposit issued by a bank that has a
certificate of deposit rating of at least 1 or the equivalent by a
nationally recognized credit rating agency or that is associated with a
holding company having a commercial paper rating of at least A-1, P-1,
or the equivalent by a nationally recognized credit rating agency; and
(3) corporate bonds, debentures, or similar debt obligations rated by a
nationally recognized investment rating firm in one of the two highest
long-term rating categories, without regard to gradations within those
categories.
2256.021. Effect of Loss of Required Rating
An investment that requires a minimum rating under this subchapter does not
ualify as an authorized investment during the period the investment does not
.ave the minimum rating. An entity shall take all prudent measures that are
onsistent with its investment policy to liquidate an investment that does not
ave the minimum rating.
2256.022. Expansion of Investment Authority
Expansion of investment authority granted by this chapter shall require a
.isk assessment by the state auditor or performed at the direction of the state
.uditor.
2256.023. Internal Management Reports
(a) Not less than quarterly, the investment officer shall prepare and submit
o the governing body of the entity a written report of investment transactions
:or all funds covered by this chapter for the preceding reporting period.
(b) The report must:
31
Gov't Cue @ 2256.023 (1998)
'1) describe _n cetara .he investment cositaon of the entity on the
date _[ t..e report;
):31 6e prepares `fint1'y by all investment officers cf the entity;
)3( be signed by each investment officer of the entity;
4) contain a summary statement, oreparea in compliance with generally
accectee accounting principles, f each pooled funa Group that states
the:
.A) beginning market value for ane reporting perroa;
(9) auditions and changes to the market value during the period;
(C) ending market value for the period; and
(D) fully accrued interest for the reporting period;
(5) state the book value and market value of each separately invested
asset at the beginning and end of the reporting period by the type of
asset and fund type invested;
Tex. Gov't Code @ 2256.023 (1998)
;6) state the maturity date of each separately invested asset that has
a maturity date;
(7) state the account or fund or pooled group fund in the state agency
or local government for which each individual investment was acquired;
and
(8) state the compliance of the investment portfolio of the state
agency or local government as it relates to:
(A) the investment strategy expressed in the agency's or local
government's investment policy; and
(B) relevant provisions of this chapter.
(c) The report shall be presented not less than quarterly to the governing
body and the chief executive officer of the entity within a reasonable time
after the end of the period.
(d) If an entity invests in other than money market mutual funds, investment
cools or accounts offered by its depository bank in the form of certificates
@ 2256.024. Subchapter Cumulative
(a) The authority granted by this subchapter is in addition to that granted
by other law. Except as provided by Subsection (b), this subchapter does not:
(1) prohibit an investment specifically authorized by other law; or
(2) authorize an investment specifically prohibited by other law.
32
Te- )v't Ccde @ 2256.024 (1998) =B_
'b) Except with respect to those investing entities described It Clbsection
., a security described in Section 2256.009(P) is not an authorized investment
or a state agency, a local government, or another investing entity,
otwithstanding any other provision of this chapter or other law to the
o n t r a r y.
(c( Mortgage pass-through certificates and individual mortgage loans that may
institute an investment described in Section 2256.009(bl are authorized
:vestments with respect to the housing bond programs operated by:
(1) the Texas Department ct Housing and Community Affairs or a
nonprofit corporation created to act on its behalf;
(2) an entity created under Chapter 392, Local Government Code; or
(3) an entity created under Chapter 394, Local Government Code.
2256.025. Selection of Authorized Brokers
The governing body of an entity subject to this subchapter or the designated
.nvestment committee of the entity shall, at least annually, review, revise, and
idopt a list of qualified brokers that are authorized to engage in investment
-ransactions with the entity.
3 2256.026. Statutory Compliance
All investments made by entities must comply with this subchapter and all
ffederal, state, and local statutes, rules, or regulations.
Sections 2256.027 to 2256.050. Reserved for expansion.
2256.051.
Any local
:ollected or
Electronic Funds Transfer
government may use electronic means to transfer Cr invest all funds
controlled by the local government.
3 2256.052. Private Auditor
Notwithstanding any other law, a state agency shall employ a private auditor
:f authorized by the legislative audit committee either on the committee's
.nitiative or on request of the governing body of the agency.
J 2256.053. Payment for Securities Purchased by State
The comptroller or the disbursing officer of an agency that has the power to
invest assets directly may pay for authorized securities purchased from or
through a member in good standing of the National Association of Securities
Dealers or from or through a national or state bank on receiving an invoice from
the seller of the securities showing that the securities have been purchased by
the board or agency and that the amount to be paid for the securities is just,
33
Te :ov't Code @ 2256.053 (1998)
ae, ana u-caid. A purcnas.. of securities may not be made at a price that
,%ceeas pr_ eristina market value of the securities.
2256.054. Ielivery of Securities Purchased by State
A security purchased under this chapter may be delivered to the comptroller,
I bank, 0_ the board or agency investing its funds. The delivery shall be made
:ager r_rmai and recognized practices in the securities and banking industries,
.ncludinc __e cook entry proceaure of the Federal Reserve Bank.
@ 2256.055. :eposit of Securities Purchased by State
At the direction of the comptroller or the agency, a security purchased under
-his chapter may be deposited in trust with a bank or federal reserve bank or
oranch designated by the comptroller, whether in or outside the state. The
eposit shall be held in the entity's name as evidenced by a trust receipt of
:he bank with which the securities are deposited.
2256.056. Sompliance With Other Laws
Notwithstanding any other law, a municipality with a population of less than
`_0,000 may not issue for any purpose or cause to be issued in its behalf any
_nstallment sale obligation or lease -purchase obligation having the principal
=mount of $ 1 million or more without complying with the provisions of Section
3.002, Chapter 53, Acts of the 70th Legislature, 2nd Called Session, 1987
(Article 717k-8, Vernon's Texas Civil Statutes), regardless of whether the
Tex. Gov't Code @ 2256.056 (1998) =g=
obligation was issued individually or in a series of related transactions, or
whether the obligation was issued with no recourse to the local government.
Tex. Gov't Code @ 2256.057 (1998)
30 2256.057 to 2256.059. Deleted by Acts 1995, 74th Leg., ch. 402, @ 1, eff.
Sept. 1, 1995
Sections 2256.060 to 2256.100. Reserved for expansion.
Tex. Gov't Code @ 2256.101 (1998)
80 2256.101 to 2256.104. Deleted by Acts 1995, 74th Leg., ch. 402, @ 1, eff.
Sept. 1, 1995
34
APPENDIX B
LIST OF AUTHORIZED CITY REPRESENTATIVES
City of
tr-41,
—Corpus
greessollassa
APPENDIX B
LIST OF AUTHORIZED CITY
REPRESENTATIVES
Attached to and made a part of the
City of Corpus Christi Depository Services Agreement with Frost
National Bank approved by City Council on May 13, 1997, in Motion M97 -1I2
AUTHORIZATION FOR DEPOSITORY ACCOUNTS
As the duly appointed and authorized City Manager of the City of Corpus Christi, I designate the
officers listed below as the Authorized City Representatives of the City of Corpus Christi.
The signatures below are the signatures of the Authorized City Representatives vested with full
authority to sign and transact business for the City including, but not limited to, Account Transfers,
open and close accounts, request reports, or authorize other signatories to specific bank accounts.
The signatures of the officers subscribed below are true and genuine:
Dorothea L. Montoya, City Treasurer
Michael P. Harty, Acting Director of Finance
Audre Debler, Chief Accountant
4(dsuo, "At
nacie
(1, 4, t o tio,
This Authorization for Depository Accounts is entered into in addition to and will not amend,
modify, waive, or revoke any of the terms of the City of Corpus Christi Depository Agreement
except as expressly provided herein. This authorization is entered into to facilitate the electronic
transfer of funds or administration of the services to be provided pursuant to the City of Corpus
Christi Depository Agreement. It is not intended to empower Authorized City Representatives to
approve or accept amendments, waivers, or new provisions or terms to the Depository Agreement
on behalf of the City of Corpus Christi. Authorized City Representatives remain authorized until
the Depository receives written notification revoking authorization.
THIS AUTHORIZATION FOR DEPOSITORY ACCOUNTS is effective this /L Th day of
, 1998 and revokes all previous authorizations.
ATTEST:
CITY OK -CORPUS CI:IRISTI
By /� By
Armando Chapa, City Secret y
Approved this 1 day of, 1998
By James R. Bray Jr., City Attorn y
Lisa Aguilar('
Ili MOO o?a
September I. 1098
REV IS ED
City Manager
35
APPENDIX $ C
CITY'S CODE OF ETHICS ORDINANCE
r -
City of
Christi
APPENDIX C
Printed from page 75 of Chapter 2 ADMINISTRATION* (05 -Feb -
ARTICLE V. CODE OF ETHICS*
*Editor's note --Ord. No. 20781, ° 1, adopted Sept. 19, 1989, amended
Art. V in its entirety to read as herein set out. Prior to inclusion of
said ordinance, Art. V, °° 2-311--2-322, 2-351--2-357, pertained to
similar subject matter and derived from Ord. No. 17112, ° 1(1)--(13),
adopted July 7, 1982; Ord. No. 17234, ° 1(A), (B), (D)4F), adopted Sept. 1,
1982; Ord. No. 17287, ° 1, adopted Oct. 6, 1982; Ord. No. 17399, ° 1,
adopted Dec. 15, 1982; Ord. No. 17476, ° 1, adopted Feb. 16, 1983; Ord.
No. 20637, ° 2, adopted March 28, 1989 and Ord. No. 20651, ° 1, adopted
April 25, 1989.
DIVISION 1. RULES OF CONDUCT
Sec. 2-311. Standards.
The following rules of conduct apply to all council members, board
members, and employees:
Special privileges.
(1) You shall not use your office for private advancement or gain
or to secure special privileges or exemptions for yourself or
others.
(2) You shall not grant any special consideration, treatment or
advantage to any person or group beyond that which is available
to others generally.
(3) You shall not use city facilities, personnel, equipment or
supplies for purposes unrelated to the interests of the city,
except to the extent such are lawfully available to the public.
(4) Unless you are a council member, you shall not use the prestige
of your position with the city on behalf of any political party
or cause.
36
Gifts:
(5) You shall not accept or solicit any money, property, service or
other thing of value by way of gift, favor, loan or otherwise
that might reasonably tend to influence you in the discharge of
your official duties or which you know or should have known was
offered with the intent to influence or reward your official
conduct.
(6) In the event you receive any gift or loan of property or
services on behalf of the city, you shall promptly deliver such
gift or loan to the city manager for official acceptance and
inventory of the city.
Conflicts of interest:
(7) In the event you or one of your relatives have an interest or
any substantial interest in a contract or transaction involving
the city which comes before you in the performance of your
official duties, you shall make a written disclosure of your
interest in the matter and abstain from any vote or decision
and not participate in any discussion on the matter.
(8) You shall not engage in any outside activities or employment
which will conflict or be incompatible with the full and proper
discharge of your official duties, impair your independent
judgment in the performance of your duties, or reflect
discredit upon the city.
(9) You shall not represent any other private person, or group or
interest in any action or proceeding against or adverse to the
interest of the city or in any litigation in which the city is
a party.
(10) You shall not represent any other private person or
group in any action or proceeding in the municipal courts of
the city which was instituted by city officers or employees in
the course of their official duties.
(11) You shall not receive any fee or compensation for your official
services from any source other than the city except as may be
provided by law or authorized by the city council.
Actions adverse to the city:
37
(12) You shall not disclose information that could adversely affect
the property or affairs of the city.
(13) You shall not knowingly perform or refuse to perform any act in
order to deliberately thwart the execution of federal, state or
local laws or regulations or the achievement of any official
city programs.
(14) You shall not engage in any felony crime, misdemeanor involving
moral turpitude, or other conduct that reflects discredit on
the city.
Provisions for council members:
(15) As a council member, you shall not have a substantial interest
in any contract with the city.
(16) In order to preserve and promote independent advice and
decisions from city boards and the integrity of the independent
board process as a council member, you shall not speak before
any city board, commission or committee except on behalf of
your own financial interest; in which case, you shall publicly
state the nature of your financial interest and that you are
appearing only in your private capacity.
(17) As a council member, you shall not give any orders to any
employee except through the city manager as provided by the
city charter.
Provisions for board members:
(18) As a board member, you shall not have a substantial interest in
any contract with the city in which your board or commission,
or the city department related thereto, has jurisdiction.
(19) As a board member, you shall not represent or appear on behalf
of the private interest of others before your board, commission
or committee, the city council, or any board which has
appellate jurisdiction over your board, commission or committee,
concerning a matter
which is within the subject matter jurisdiction of your board.
This rule does not prohibit you from appearing on behalf of
your own financial interest even though others may have the
38
same - a similar interest.)
Provisions for employees:
(20) As an employee you shall not have an interest in any contract
with the city.
(21) As an employee, you shall not, within twelve (12) months after
leaving city employment, represent any other person or
organization in any formal or informal appearance with the city
council or any other agency or employee of the city concerning
a project for which you had responsibility as an employee.
(22) As an employee, you shall not represent or appear on behalf of
the private interest of others before the city council or any
board, commission or committee of the city. (This rule does not
prohibit you from appearing on behalf of your own financial
interest even though others may have the same or a similar
interest).
(Ord. No. 20781, ° 1, 9-19-89; Ord. No. 20913, ° 1, 5-1-90)
Sec. 2-312. Definitions.
The following definitions apply to the above rules of conduct:
Board member: A member of any board, commission or committee of the
city, including the board of any corporation created by the city.
Employee: Any person employed by the city, whether under civil
service or not, including part-time employees and employees of any
corporation created by the city.
Interest: Any direct or indirect pecuniary or material benefit in a
contract or transaction other than:
(1) An interest which is shared by and available to all other
persons similarly situated; or
39
(2) A rer e or incidental interest which would not it case or
decr 3 materially due to the action of the city is less
than two hundred dollars ($200.00) in value; or
(3) An interest of a subcontractor which has no direct contractual
relationship with the city, is receiving fair and reasonable
compensation, and is not operating as a subterfuge to
circumvent the code of ethics; or
(4) An interest in real property acquired by the city which could
otherwise be accomplished only through eminent domain provided
that the property must be acquired for a public purpose and
just compensation must be paid under the Texas Constitution
after obtaining an independent appraisal.
Substantial interest: Any interest which has a value of five thousand
dollars ($5,000.00) or more or represents ten (10) per cent or more of a
person's gross income during the most recent calendar year.
Relative: Spouse, father, mother, brother, sister, son, daughter,
spouse's children, father-in-law, mother-in-law, brother-in-law, sister-in-
law, son-in-law, daughter-in-law and adoptive relationships being treated
the same as natural relationships.
(Ord. No. 20781, ° 1, 9-19-89)
Sec. 2-313. Effect of violation.
A violation of these rules of conduct shall subject the council
member, board member or employee to appropriate disciplinary
proceedings, but such violation shall not render the action of the city
voidable by the city unless the action would not have been approved
without the vote of the person who violated the rules of conduct.
(Ord. No. 20781, ° 1, 9-19-89)
Sec. 2-314. Exceptions to abstention requirement.
The requirement that a council member or board member abstain from
voting on a matter or participating in discussion as contained in rule 7
of the rules of conduct shall not apply in the following situations,
provided that such person has complied with the requirements of written
disclosure of the interest:
40
(a) In the event a majority of the members of the council or the
board, commission or committee have filed a written disclosure
of a conflict of interest on the matter and would be required
to abstain; or
(b) On the final approval of the budget when the person has
abstained from a separate vote taken on the particular budget
item pertaining to the conflict of interest and action or that
particular item has been resolved.
(Ord. No. 20781, ° 1, 9-19-89)
Cross reference(s)--Rules of conduct, ° 2-311.
Sec. 2-315. Freedom of expression.
Nothing contained in the code of ethics shall abridge the right of
any citizen, whether or not a council member, board member or employee, to
exercise his or her right of expression under the U.S. or Texas
Constitutions.
(Ord. No. 20781, ° 1, 9-19-89)
Secs. 2-316--2-319. Reserved.
DIVISION 2. ETHICS COMMISSION
Sec. 2-320. Establishment.
An ethics commission is created and shall consist of nine (9)
members. The city council shall solicit nominations for the ethics
commission from a wide variety of professional and community organizations
in the city. Interested individuals may also submit their names for
consideration. Members of the commission may not hold or be a candidate
for any city elected or appointed office.
The city council shall appoint the members of the ethics commission by a
two-thirds (2/3) vote of the full council.
(Ord. No. 20781, ° 1, 9-19-89)
41
Sec. 2-321. Terms.
Members shall hold office for three-year terms commencing October 1.
In order to establish staggered terms, however, the initial terms of three
3) members shall be one year, and the initial terms of another three (3)
members shall be two (2) years. The persons serving such shorter terms
shall be determined by lot. No holding over is permitted except as
expressly provided in this code of ethics.
(Ord. No. 20781, ° 1, 9-19-89)
Sec. 2-322. Removal.
In addition to the council's usual powers of removal, members of the
commission may be removed by a majority of the council for cause. In
considering a complaint filed with the city secretary or on its own
initiative, the council may follow the procedures hereinafter set forth
regarding the disposition of such alleged violations.
(Ord. No. 20781, ° 1, 9-19-89)
Sec. 2-323. Vacancies.
All vacancies shall be filled for the unexpired terms. A
member shall hold office until his successor has been appointed, and
shall continue to hold office after his successor has been appointed for
the limited purpose of disposition of all complaints filed and for which
presentation of evidence was commenced during that member's term.
(Ord. No. 20781, ° 1, 9-19-89)
Sec. 2-324. Chairperson; quorum.
The commission shall elect a chairperson and a vice -chairperson. The
vice -chairperson shall act as chairperson in the absence of the
chairperson or in the event of a vacancy in that position. The officers of
the commission shall serve one-year terms. A majority of the members of
the commission shall constitute a quorum.
42
(Ord. No. 20781 ° 1, 9-19-89)
Sec. 2-325. Meetings.
The commission shall have such meetings as may be necessary to
fulfill its responsibilities. The chairperson or any three (3) members may
call a meeting provided that reasonable notice is given to each member.
The commission shall comply with the Texas Open Meetings Act.
(Ord. No. 20781, ° 1, 9-19-89)
Sec. 2-326. Duties.
(a) The commission shall, in addition to its other duties:
(1) Prepare and publish pamphlets and other materials explaining
the duties of individuals subject to the code of ethics. Such
materials shall include instructions to the public about how to
obtain information such as financial disclosures, campaign
reports, and the like from the city.
(2) Review all statements and reports filed with the city.
(3) Annually review the code of ethics and make appropriate
recommendations to the city council after conducting a public
hearing on any such recommendations.
(4) Review all public opinions related to the code of ethics that
are issued by the city attorney.
(5) Prepare and disseminate a report listing all campaign
contributions and expenditures for each candidate within thirty
30) days following the deadline for filing the last campaign
finance reports for each city council election. For the
purposes of this provision, a
general election and run-off election shall be considered as a
single city council election.
(b) The commission may:
43
(1) Adop' -ules of procedure for the conduct of its b ness and to
care ut the provisions of the code of ethics, c, Lstent with
the code of ethics and other applicable law.
(2) Prepare reports and studies to advance the purposes of the code
of ethics.
(3) Request the city council and city manager to provide such
assistance as it may require in the discharge of his duties.
(Ord. No. 20781, ° 1, 9-19-89)
Sec. 2-327. Staffing.
The commission shall be assigned staff by the city attorney to assist
in its duties. The commission shall also designate independent legal
counsel, and when complaints are filed, such independent legal counsel may
be utilized to advise the commission and participate in hearings.
(Ord. No. 20781, ° 1, 9-19-89)
Sec. 2-328. Legal opinions and services.
(a) Any council member, employee or board member may submit a written
request to the city manager for an opinion concerning the meaning or
effect of any section, word or requirement of the code of ethics as it
affects such official, employee or board member.
The city manager shall submit such request to the city attorney, who will
promptly issue a written opinion to the city manager.
Such opinion shall be filed with the city secretary with a copy to the
requesting person shall constitute an authoritative determination of the
meaning of this article, until amended by the council.
(b) If a complaint is filed with the ethics commission about any
specific action, omission or alleged conflict of interest by the charged
person which has been the subject, in whole or in part, of a city attorney'
s opinion, the independent legal counsel shall act as the commission's
attorney on said complaint.
(Ord. No. 20781, ° 1, 9-19-89)
44
Sec. 2-329. Jurisdiction of commission.
The ethics commission shall have jurisdiction of complaints
involving any "city official" which includes the mayor and members of the
city council, city manager, deputy and assistant city managers, city
secretary, city attorney, department heads, and municipal court judges
including substitute judges), and all members of any board, commission or
committee of the city, including the board of any corporation created by
the city.
(Ord. No. 20781, ° 1, 9-19-89)
Sec. 2-330. Complaints.
(a) A sworn complaint alleging violation of the code of ethics shall
specify the provisions of the rules of conduct alleged to have been
violated and facts alleged to constitute the violation.
(b) Upon the sworn complaint of any five (5) people filed with the
city secretary's office, the commission shall consider possible violations
of the code of ethics by city officials and board members and former city
officials and board members other than members of this commission. In
addition, the commission shall consider such possible violations when
referred to it as a complaint by majority vote of all council members
holding office and qualified to vote thereon. The council may direct the
city attorney to draft such referred complaint, which shall be reviewed as
other complaints hereunder. The council members voting for the complaint
shall sign the complaint.
(c) A complaint alleging a violation must be filed with the city
secretary within six (6) months from the date the complainants knew or
should have known of the action alleged as a violation, and not afterward.
(d) Not later than three (3) working days after the city secretary
receives a sworn complaint, he or she shall acknowledge receipt to the
complainants, and provide a copy to the city attorney, the commission and
the person complained against. Not later than thirty (30) days after
receipt of a complaint by the city secretary, the commission shall notify
in writing the persons who made the complaint and the person complained
against whether it intends to schedule a hearing or take other action
concerning the complaint. The person complained against shall have ten (10)
days to submit a written response to the complaint prior to the commission
deciding whether to hold a hearing. The complainants shall have one
opportunity within fifteen (15) days of any denial of their original
complaint by the commission to amend their complaint and refile the same
with the commission.
45
(e) Legal fees incurred by the complainants, the commission, and the
party complained against, in an amount determined reasonable by the
commission, shall be paid by the unsuccessful party if the commission
determines such party's complaint or defense was groundless. "Groundless"
means (1) without basis or fact, or (2) not warranted by law or reasonably
arguable
interpretation thereof. The complainants shall not be liable for such
fees if the commission has determined grounds exist for a hearing.
(Ord. No. 20781, ° 1, 9-19-89; Ord. No. 20896, ° 1, 3-27-90)
Sec. 2-331. Ex parte communications.
After a complaint has been filed and during the pendency of a
complaint before the commission, a member of the commission may not
communicate directly or indirectly with any party or person about any
issue of fact or law regarding the complaint, except at a meeting of the
commission.
(Ord. No. 20781, ° 1, 9-19-89)
Sec. 2-332. Hearing.
(a) The hearing shall be held as expeditiously as possible following
the determination by the commission to conduct a hearing on a particular
matter. The commission may grant two (2) postponements, not to exceed
fifteen (15) days each, upon the request of the person complained against;
provided, however, the commission may also delay commencement of a hearing
for good cause such as a hurricane or unavailability of a material
witness.
(b) The issue at hearing shall be whether the violation alleged in
the complaint occurred. The commission shall make its determination based
on the preponderance of credible evidence in the record. All witnesses
shall testify under oath. Strict rules of evidence shall not be required;
however, the commission shall require that all evidence be of such quality
that persons customarily rely on in the conduct of serious affairs. If the
commission determines that a violation has occurred, it shall state its
findings in writing, shall identify the particular provisions which have
been violated, and within five (5) working days shall deliver a copy of
the findings to the complainants, the person complained against, and the
city secretary.
(Ord. No. 20781, ° 1, 9-19-89)
46
Sec. 2-333. Oaths.
If a complaint proceeds to hearing, the commission may subpoena
witnesses to attend and testify, administer oaths, take evidence and
subpoena the production of books, papers, records or other evidence needed
for the performance of the commission's duties or exercise its powers,
including its duties and powers of investigation.
(Ord. No. 20781, ° 1, 9-19-89)
Sec. 2-334. Sanctions.
(a) If the commission determines that a violation occurred, it shall
proceed directly to determine its recommendation of appropriate sanctions.
The affirmative vote of a majority of the members holding office and
qualified to vote shall be required for the determination that a violation
has occurred and the recommendation any sanction under this code of
ethics. The commission may receive additional testimony or statements
before considering sanctions, but is not required to do so.
(b) If the commission determines that a violation has occurred, it
may recommend the following:
(1) Against a council member or against a board member or city
official appointed or confirmed by the council, reprimand,
temporary suspension, removal or any other sanction or
corrective action within the power of the city council, or
recall by the citizens.
(2) Against a city official other than those in (1), that
appropriate action be taken, as deemed necessary by the city
manager.
(c) In determining its recommendation, the commission shall consider
the seriousness of the violation, the importance of deterrence, the impact
on public confidence in government, the violations' repeated or isolated
nature, the mental state with which the violation was committed, and the
prior record of the person complained against. The recommendation shall be
reduced to writing and transmitted to the supervisory authority and to the
person complained against.
(d) If the commission finds that conduct occurred which, if willful,
would violate the rules of conduct, but the commission cannot determine
that the conduct was a willful violation because of ambiguity as to the 47
meaning of the - ,ndard of conduct involved, the commission 1 recommend
no sanction, bt ill issue a clarifying interpretation to g, a future
cases.
(e) Nothing in the code of ethics shall change or affect the civil
service, at will, or other status of any employee, city official, or board
member as established by the city charter and ordinances.
(f) The city council or supervisory authority shall consider the
recommendation of the commission, but will exercise its own judgment and
discretion in determining what action, if any, to take.
(g) If the commission determines that a violation of any criminal law
has occurred, it shall deliver a copy of its findings to the complainants,
the person complained against, and the city attorney, recommending whether
prosecution should be initiated or setting forth requirements to be
complied with in order that voluntary compliance requirements may be had.
Said
findings shall also be delivered to the county attorney or district
attorney, if a violation may be within their jurisdiction.
(Ord. No. 20781, ° 1, 9-19-89)
Secs. 2-335--2-339. Reserved.
DIVISION 3. FINANCIAL DISCLOSURE
Sec. 2-340. Required reports.
On or before the last Friday of April of each year, reporting
officials shall file with the city secretary an annual report of financial
information covering January 1 through December 31 of the previous year.
Council members and planning commission members shall also file with the
city secretary a supplemental report of financial information by the last
Friday of July of each year covering the most recent January 1 through
June 30.
(Ord. No. 20781, ° 1, 9-19-89)
Sec. 2-341. Definitions.
48
The follow' definitions shall apply to these financial 'sclosure
provisions:
Person: An individual, proprietorship, firm, partnership, joint
venture, syndicate, trust, company, corporation, association, committee,
estate, receiver, entity or any other organization or group of persons
acting in concert, whether profit or nonprofit.
Relative: Spouse, father, mother, brother, sister, son, daughter,
spouse's children, grandfather, son-in-law, daughter-in-law, grandmother,
uncle, aunt, nephew, niece, grandson, granddaughter, first cousin, father-
in-law, mother-in-law, brother-in-law, sister-in-law, grandfather -in-law,
grandmother -in-law, uncle by marriage, aunt by marriage, nephew's wife,
niece's husband, grandson -in-law, granddaughter -in-law, and first cousin's
spouse, adoptive relationships being treated the same as natural
relationships.
Reporting official: The mayor and members of the city council, city
manager, deputy and assistant city manager, city secretary, city attorney,
department heads, municipal court judges (including substitute judges),
and all members of the planning commission, ethics commission, civil
service board, civil service commission, Corpus Christi Health Facilities
Development Corporation, Corpus Christi Housing Finance Corporation,
Corpus Christi Housing Improvement Corporation, Corpus Christi Industrial
Development Corporation and the
attorney who serves as local issuer's counsel for and any executive
employee hired by the above corporations.
(Ord. No. 20781, ° 1, 9-19-89)
Sec. 2-342. Content of reports.
The reports required shall contain the following information for the
reporting period by separate listing. In this section, the report for the
reporting official shall include all such information for the reporting
official's spouse, but information relating to the spouse need not be
segregated from that relating to the reporting official.
(a) Name and residence address.
(b) All professional, occupational, business licenses held by the
reporting official.
(c) The names of any businesses with which the reporting official
was actively engaged or associated, and the principal address
49
and - ne number of each, together with the posits or title
held Phis list should not include interests in c »ositions
with any businesses which are required to be reported in other
provisions of this section.)
(d) The names and addresses of all sources of income which exceed
ten (10) per cent of the reporting official's gross income, or
five thousand dollars ($5,000.00) in salary, bonuses,
commissions or professional fees, or twenty thousand dollars ($
20,000.00) in payment for goods, products or non-professional
services. If the reporting official is self. employed or owns
or controls at least a twenty (20) per cent interest in a
partnership, corporation or other entity through which the
reporting official does business, the reporting official shall
also report the names and addresses of the clients or customers
who do business with the city from whom the reporting official,
partnership, corporation or other entity received at least ten
10) per cent of its gross income. Prior to each reporting
deadline, the city shall publish a list of the names and
addresses of the persons who do business with the city in the
amount of ten thousand dollars or more each year (excluding
utility services or the payment of taxes) which reporting
officials may rely upon for the purposes of complying with this
provision. A reporting official operating a business as a sole
proprietor shall not be required to report a client or customer
under this subsection he or she would not have to report if
operating as a corporation or partnership.
(e) The names and addresses of all corporations,
partnerships or other business organizations in which the reporting
official held, owned, acquired or sold stock or other equity ownership
having a value exceeding five thousand dollars ($5,000.00) or equivalent
to ten (10) per cent or more of the stock or equi
50
APPENDIX -&D
CITY'S INDEMNIFICATION ORDINANCE
City of
Corpus
:..
Christi
APPENDIX D
PERSONNEL S 39-16
completed twenty-five (25) or more years of creditable
service for which he is entitled to credit in the Texas
Municipal Retirement System. and who has been a member
of the system for one year or more, shall be eligible for
service retirement as provided in subsection 1(b). Section
VII of Article 6243h. Vernon's Texas Civil Statutes, as
ameadsd- Any at employee who shall have completed
twenty (20) years or more of creditable service as an
employee of said city shall costate as a member of Texas
Municipal Retirement System despite subsequent absence
from service for a period in excess of sixty (60) months.
provided he does not withdraw his deposits during such
absence. and shall be eligible for retirement upon and after
attainment of the minimum age prescribed by the Act above
mentioned. (Ord. No. 12992.. § 1, 1.21.76)
Rditer'e aa.—OS. Na ant waned Jan. 21. 1976. not ameadaten o[
tie Cada. ba bees added u f 3$-16 at the editors dimension.
Sas. 39-16. Legal defense and lndotmaification of city
officers and employees.
(a) Definition For the purposes of this section the term "offi-
cer" shall inclnde any elected or appointed official of the sty; and
the term "employee" shall include all employees of the city.
whether under civil Berries or not. including firemen and police-
men. and shall include authorised volunteers. working under a
volunteer program approved by the day manager.
(b) Indemnification. Any officer or employee who is liable for
the payment of any claims or damages arising out of the course
and scope of employment shall be entitled to indemaiecation by
the city provided that the sea or omissions resulting in such
liability were done in good faith and without malicious or feloni-
ous intent. For the purposes of this section. the term "arising out
of the course and scope of employment" shall not include any
action which occurs era during a period of time in which the officer or
employee is engaged in outside employment or is rendering con-
tractual services to someone other than the city. Whether the
acts were done in good faith. without malicious or felonious in-
tent. and within the course and scope of employment shall be
determined by the city, and such determination shall be final for
the purposes of the representation and indemnity of this section:
Seep. a 26 3336.1
51
I 39.16 CORPUS CHRISTI CODE
provided. however. that in the event such representation and •
indemnity have bees denied by the city, if upon a trial an the
merits the city deteeminee that the officer or employee was act-
ins
veins in gad faith, without malicious er felonious latent and within
the scope of employment the indemnification haunch shall be
stunted and remosable lural expenses marred in the ddenrn d
the claim raimbmsd. The Sty shall ant be liable far any settle -
tont of ant each claim or suit effected without consent. and the
city ressavee the right to avert any defense and maim any set-
tlement of any claim or suit that it deems expedient.
(e) Repreraresstioa in amiss The city shall have the right and
duty to provide lewd representation through the city attorney, or
in in discretion through the selecOoa of outside legal counsel. to
nay officer or employee sued in amnestic. with any claim for
damage or odor civil action against such pesos arising ant of
the course a.^ saw) ofemploymeat. provided that snob officer or
employee is entitled to indemnification as set forth in this sae -
tint Such legal representation shall be provided at no oast to tba
officer or employes. and any officer or employee may have his or
her own auaasi satin in the ddeaas at the sole expose of the
Miter ar employee. Tba Sneer or employee shall o mperato fully
with the city in preparation and pnasotation d tba ass. and the
failure to cooperate shall wain such officer's or employee's right
to representation and indemnity under this section.
(d) City's defenses. Nothing in this suction *hail be
construed as waiving tba city's defense of governmental
immunity to it or its employees or officers in any action
brought against the city ar sock officer or employee. For any suit
or claim arising wader the Tan Ton Claim* Act. the iademtuty
provided by this section shall be Umitad to the • statutory limits.
applicable to the city provided in said As. as amended.
(e) Notice. The provisions of this section *ball apply only
when the city has been given notice of tbs action brought
against any city officer or employee within ten (10) days of
service of process upon the officer or employee.
(f) Disciplinary actions. Nothing in this section shall
prevent the city from taking disciplinary .action against any
officer or employee for conduct defended or int mai^.ad by
Swat He SI 3336.2
52
PERSONNEL 139.17
the city under this secuon. either before or after conclusion of the
civil suit.
(g) Suits in behalf of the city. Nothing in this section shall
require the city to indemnify any officer or employee for recover-
ies made against him or her in suits by or on behalf of the city.
The city council may, however. authorize the city attorney to
represent any officer or employee in a suit brought by a taxpayer
in -behalf of the city against the officer or employee. (Ord. No.
14320, 4 1. 54748: Ord. No. 17867. if f 1-3. 10.5.83: Ord. No.
19863.4 1, 7.2147; Ord. No. 19864.1 1. 7-21-87)
See. 39-17. Political activities of city employees.
(a) Purpose The purpose of this section is to clearly establish
prohibited and permissible political activities ler all city employ-
ees. classified or unclassified. except those otherwise regulated
by federal or state law.
(b) Polity. It is the policy of the City of Corpus Christi that city
employees be prohibited from taking an active part in campaigns
far city elective office apt as a candidate for an office under the
City Charter. It is similarly city policy that, except where ex-
pressly provided otherwise. city employees shall have the right to
fully participate in political activities other than campaigns for
city elective office. It is the purpose of this section to specifically
delineate those activities which city employees may and may not
participate in.
(e) Regulated activities
(1) To avoid undue influence of city employees on the outcome
of city council elections and to avoid undue influence of
city councilmen or candidates for city council on city em-
ployees. the following restrictions are imposed:
a. No employee of the city or association of such employ-
ee may publicly endorse or actively support candi-
dates for the city council or any political organization
or association organized to support candidates for the
city council:
b. No employee of the city may circulate petitions for city
coal candidates. although he may sign such a petition:
Sapp. Ns 21
3336.3
53
APPENDIX -F E
WIRE AND ELECTRONIC SERVICES
City of
Corpus
Chnsti
APPENDIX E
Frost National Bank
COMPAN'YAGREEME T
FOR ELECTRONIC FUNDS TRANSFERS
THROUGH THE AUTOMATED CLEARINGHOUSE
This Agreement is entered into as of the is t 4a of August I 9 between City of Cornus Christi ("Company"), a Some -Rule
. City with its principal offices located at 1201 leopard St. Cornus Christi. Tx. 78401 and THE FROST NATIONAL. BANK
("Originating Bank"), a national banking association. with its principal offices located at 100 West Houston Street San Antonio. Bazar County,
Texas 78205.
RFCITAI S
A. Oaring Bank is a pereapamg finaaad mmmam at the Southwest= Automad Clang Hour Anaaanan I'SWACHA'1 which provides facilities for the
ocean of arca ha trainers ammo tis memo= and oma automated deans house auaaaoms atm to United Sana by unlwng me eapadme of the Nana M Automated
Cleama Hour Assonance rNACHA').
B. Caamy mass to ova " Eames purse= to the tams of this Agreement ad the nae of NACHA ad SWACHA (the ..aa of NACHA have bee adopted as to
rules of SWACHA. and Dry nda mdudma to oat= =dame and other applicable regulmes pthhtsd maewdL an herrn nimt to as the 'Rule'). and Ch am®a Bank is
withal to as as en Onpmmg Dapatory Emma than sum teapea to such Fame.
C. Udo menus defied herein. teems used herein shall are the some mtsap provided in to Rules. The tam 'Eames' mall haw the nine meaning provided m
the Rules and shall also mem the clam neared from Compay haoader from which Caguas Bask papas Enema The tam 'bas dy as erase bras toms a day m which
Origami Bank a opo to the public fa mane m mhoealy W of its bas (altar the a Srorday or Swaday) ad m wbtch the ACH is the apes for ars
ittraRLEMINI
1. Ir.tn as of Fewin by Cmmnat. Company may deliver Emma to Originating Bak berm to haus of 1:00 A.M. aped 190 P.M. on a bene day. s
Cala = Been Cash Magma Seylos Dona ACM Udt located a 100 Ws Hoo Sus. Sas Aaaia Tam by names of to stand atleua m the Adana aar►sa
basso. Eames seal be de aasd m Onpnmmc Bak oro Isar than 12:00 exam tot Edmore Envy Dna for Sea Day Serino m lam tha 12:00 fl ambos day pito tether
Effective Envy Ds for Om Day Salem= ad oro Ism to 12:00 an two hams days pee to thin Effective Eray Des for Two Day Salmon. If Era as dakverd to Origami;
Bak Wer 12:00 ea m a bass day. airman. Bak may na each Eames a haves been recervd on as es following bars day. Ennio damned to Oripsaag Bak shall be
pap red lad aura u ompiam wit the faring ed ads agmen IS e fret a the Rale and a aaaaam with to mi nons with mspm m as Emits s Ism herein ad
an is Addenda ached hero. The Weave Ea Da specified for all Enda an be has days. Ere all be domed dakvtd w Chaim, Bak wham the read amity
Padaa poach far rid ea tt le such rasion m as fat m to Addadte acid berm are been anaephd with ad. (i) is the Don of vasal by ape a ditae, an
raved by Origa mi Bak a to brace s at akevc or (u) in the me of Damm c ds Derma Was to na uea w Onpman Bak a aaplsd: or (iii) a to a of
telephmwfat tomutama what the telephone and fait mar err ss have been maned by Ov aieaaa Bank at to loaom s fort above.
2. Ate. Camay sa8:
(a) Obtain aahaiatim from the "Receiver' of ay Envy (i.e. Camay. mployee a cl mm or other person war amus is to bo debiss laboid for
the Eny) trop an sutaama apesa a ram byte Rake Were rams say Easy to to Rants rotas: nth srhamm 1,0111111111110 an Camay
to inmate Debit Eames a Credit Evia a the case may be. to to Receivers eo n and m ®a= if anew y. Debit Entries and dr as fa ay Credit Emir mote m
mato to R®vers au= a 4 such atonaam agreement to arena can with to agaamo of the Rules ad applicable law and .-.-'--
(b) Rain each such amboaimm spas= for a leg am= remains in eSra and for a paid of two (2) yam afar the summa or mad= d= of
such rahtaiaaoon apace: -
(c) Notwttamdn1 pores tote mouthy m me Rules cmoaed. provide paays eons w each Raver that a pomhaaed may has bot hoiaod or
• among army a• hot as ad
(d) Upon reoam from Orates= Bok a my Raving Drypomy Pima mammon ("RDFT). Melds Ongmdag Bane tot RDFI with ■ copy of
such mthatfanm spasm w armamm wt the Rade.
3. Se !IV w.....k.... Column and Chipman( Bank shall axe* with the ,worry let= wt retard to the thdivmnresmdal of Eames and requeaa fo
cncelmm or carman of Eama by Company to Duane; Bank as provided on the Addmtmm cached baso.
4. ) imhePrr Flory 1 unit. The tow dollar imam of all Enures delivered to Dripnanng Bank in any one file of Fames tall not orad the 'Limit sa form on the
Addendum attached Ma and the maximum dollar anamt of any one Emmy darveM to Onananng Balt. =abet as a single Emmy or teetotal widen a paup of Fame shall nor exceed
the 'Pa Easy limit a forth on the Addmdmt attached hereto. If Company heater dare to change the applicable Limn dor Per Emmy Limit. Campay shall. at leas to bots days
prem w the dale m wet it dentes mob new Limn and/or Per Envy Limit to be sffrove. deliva to Oripnmg Bark a =um request fa such charge duly s aand on behalf of Cmpoy.
No reduction to the Lor anaor Per Entry Limit tall be etfmve until ten hoards rays after such neatest as actually been dS.vaed to Cagu aas Baric and no manse m the limit ardor
Pa Fairy Limn shall be effecave ms and until Chipman; Bank espessly agrees thereto in sun=g. n bang aped tat Originating Bank shall have no Wipe= to aper to my masa in
the Lan endear Per Entry Lamm. Onpa ng Bank tall have the npt to reduce Inc applicable lame tailor Pa Entry Lunn a any ums mmdmely upon delivery of name thereof to
Company.
54
I al aurae as minded m Somas a and 7 hereof. Onatant Bank shall 0) amiss Eames received from Company conforming with the reomremmu r
that Agreement and the Rules: (Ili transmit such Edema as Onnnaong Depository Fmannal lnmmte to to Southwestern Automated Cleanog House titre 'ACM") through th
Federal Reserve Bank of Dallas acting as the Automated Clearing House procnmr. and i uI i seine fa such Eames as provided m to Rices.
(b) Ongdann! Bank will aaa®o Credit Ernes oenmuted for One -Dar Settlement to the ACH for One -Day Settlement by the evening deadline of rb
•CH one Duman day nna to the Effeeave Eatry Date shown io such Enures. provided mar mer Fame are delivered to Oncoming Bak by 12:00 Nom oe a business da
which is al lean ane Dusins day prior to the Effective Ensu' Dau for such Enures. Onenaog Beak With transom Credit Eames emmated for Two -Day Semmeat to me AC
for Two -Day Seamans by the evening deadline of the ACH two ousmess trays onor to the Effeeove Eery Due mown in such Eames. provided that such Eames are delivered t
Ongrnas= Bank by 12:00 Nom on a tautest ay which Is u taut two wetness nays pnor to the Efftain Entry Date for such Eats.
le) Ommnamtg Bank will transmit Debit Enron °estimated for One -Day Sammi to the ACH by the mane deadline of the ACH one buena day pnc
to the Effective Entry Date mown In such Eames. minded that such Eames art avant to Onaoamag Bagrk by 12:00 Noon 0112 Dens day which is n least Doe busmen da
prim to me Effecnve Entry Due tin such Eames. Gnawing Baa Will nnmtn Debit Enures dmpmaed for Twd-Day Settlement to the ACH by the mmmng Sins of in
ACH one wane av mor to the Effective Eaev Due mown in such Eames. provided that such Eames are delv=ed to Ongmaong Bank by 12:00 Noon oe a Means a
whim n at tem two Duenm days mina m the Effective Easy Due for such Eames.
(d) If Ela art delivered lase ire. they are not delivered to Onpnaaag Bak by the tine safid for delivery for One -Day Settee= or Two -Da
Statement as the ease may be. as see flab m Semen 1. haiofl. or If die Effective Enay Das scathed for the Enna u not s assess ay. then Originating Bank may Tema a
Earn or Onpnaai Bank may use in reasonable effort to gramma such Eames to the ACH by the aha rrueamly =at= depict deedlns of the ACM following the anti
spedfied to sub -seam (b) end (e) above. If Entries dnvgnaed for Two -Day Sealeent we debated lair:. Osigiaasmg Bank ma. If necessary to ma the Effective Espy Dat
for such Eames use in amsmable than to transmit the Eames for One -Day Sam= and in suds event Oncoming Bak tory map to cmmary addition fees that L
no event will Originating Bank be liable for any los =Man a from any falun of a Recovers satoms to be debtsWaedttd fa an Espy on its Effective Entry Date wbm Tem,
(tom late delivery of the Entry m Onpnanng Bank a watch rents from me Efecave Entry Dm speeded for sum Eery not burg a Warm ay.
b. (CUs .nes. Except .s prondmd m Season 7. hent m the ase of an Entry reared for dmmoeaed,t to an account mammal with Originating Bank ('an On -L.
Earn. Ongmaag Bank mil a ,uaea the Remmers ramms m the moa of suds Entry m the Efemve Ely Dae mnmmd m sum Wry, provided that sues Wenn Entry Dau Is
boast any. and (1) fa a Etat demand for Two -Day Sabina such Each a dammed to Onpmng Bank by to at than 12:00 Noon tea amen day whim u a Ids two Maw
days ,or m the Efavva Entry Dae far inch Ear Oil for as Ely aeamaed fa One-Dev Satiate mm hay is amend to Oapm rine Bink by no mm than 12:00 Nom an a bars
day which is a lose me Wanes day pica 10 to Ethane Earl Dae tor sock Easy: er (till fa as Entry dsgnnrd for Ss-Dey Sammi such Envy u dolma to Onpmeg Bit b
no Inc man 12:00 Nom m the Effective Envy Dam fa ase East. If sum Eery t delivered Wt lie_ n is m reel m Cinema Bak by ase Dae inion ebcwL ant the Efarw
Eery Dau eveaeed fa the Ealy is not a bases nay. Onp•ms. Baa may I a ma Easy Or may het o ueemebfa efmt m debitlea tt M Ree nue aeon m to ams Of ase
Entry on the Efasn Eton Dae contained in sum Ely ce m the soonest bums day Charm as as maser Walt If Oo41s Eater dempemn for Two.Day Sodas we dammer
leu. Ongmmng Bank may. of necessary to ma the Effective Eay Data for sash Enna as in nameable efforts w nem nazi Fain for One -Day Seams a Sa osay Semis
ad if On -Us Eames dapumd for One -Day Settlors ramp uta. Onpaong Bank may. if nee m ems Oe Ethane Envy Dae for such Ensu m m MilliOnahill data m
proms such Entries for Sme•Day Sesta and m orb aye Ongoing Bak may chap w maser anneal his lama. In m stat will Onpmmd Bak min foray ate:
reams from ay failure of a Remmers Account to be dstedsssdtad for m Entry on its Marie Eery Dae Mich eats from Ids delivery of the Eery le OIgmmiag Bak. a whet
remit from the Effective Entry Dae spin for sock Eery not bang • Mans ay. The Bodement Ds foe each On -Us Ely shall be the ds on which ass Easy is to M
debetedraedlted to the Reamers account as above penvedatL
7. $pia120.nf Enron. Oarsman Beak may tela ay Eory la amp of Ethics/ was dam se comply with. oda is not deemed a aaa lance rch, do
regiments hats= a which comas a Maas &ay Data come an five (S) bums days the the Wins day inch Earns) s nerved by Onpomag Beek. pfgmmmg Bank shat
here the nim m meet any any (Including On -Us Elim) ke any rasa knack an Entry may be sensed ea to Bala Orions; Bak shall have the opt m ream my Entry i.
Cary has failed to compo with in aeon balm c ape= as mmmded m Season 10. hand. O.gonta Bak wtB notify Campay by mat= of any nazi mama so Ian da
the Worm day win Envy would oherwm have be .aemmed by Ongmamg Bank to the ACH as moan is sub-emooms 5G). (e) and (d) above. or. in than me of an On -Us Entry, the
business day such Entry woad othenese have bees dsita tladmd 10 a Receives Aaomt as monad m Sem 6. above. Onpmag Baa shall have no ability to Compoy by rime
of the raj ode of any such Envy or the fan that ash nonce is m pan at an tater time than that provided for bean
3. Cie .mlwim mamnea a ....v . d e..:n. Campo), shall have m right to sad or mad my Envy *Rt its teapot by Ongatang Bak, Hems=
Onpoamg Bank will cess reale ale from to a on a teas for emeedante or amendment of all Emmy reeved from ComlmY ala 10 Qigmaag Bank's vansimm et the Entry to the
- ACH o. 10 ate ase of an On -Us Entry. once 10 Onptume Banka debit/avail of the Entry to a Rows amt but Oncoming Bank Ball have no liability if arch cancellation
smameat t oa aroma. ff Comply diawvea that ase Emmy mored by one to pad was u era. C repay may comfy Onpsmag Beek Of such ria. Sera oak em6e>o-- sup
be prowled to Originating Bmk wen away -fade (24) an of ekemvay of the mor. If Capmy tat tots of am mamma Fay was Wa (4) hears drys following the
Stumm Das of mach Eauy. Ongmanng Bink may m its tele daemon mans a =tam Envy death m ACK ce behalf of Canary is awmdam with die Rolm. bowan
Ongmang Bank dm not gas as of the ahaea flea. t Compry nano Co.omonof a aroma Envy em the in (4) beam drys hilowing the Sales Ds Of neck
Ely. Onguanng Bask will aline in reasonable den to sip m ohm man of the admen finds am behalf of Came. cams yids the Rale. bowva Onpamag Bak dm not
guarantee rein of the subject funds. Compry shW seed at Saar m the Rave wanes sone of orb anotia ad the masa tate pia m requmog than eamm. All merneele for
cancellation. armament or correction of Eames mut be made by Campey m compliance watt the sauna pamame for la en a set forth ata Addenda Nero.
9. RM FSQjp. Originating Bek will mafy Compry of Onpnang Bank's nice= of a teased Eery for poach narks) bin the ACH by mailing aortae
thereat to Company no Inc than Dee Wass day after the bean dry of such rapt and Will sSuaiths Cmpaye Man for ths tend Earns) and provide emmmana thereof to
Cmpay. With spm to Creat Eames. Origami Bak w,B also aofy Company of earth roan Ermy(s) by Saxes no a them me hum ay ear a boos day Originating
Bak receives the real nand Ewes) from the ACK Caney sin issuing the sole rmpashdty for sealed me teadmsmg rid Envy(s) m aaadm with to segwe®d las
Apeman or =eons* handling the payments due the Reave(st unless the ram was ase to an as to the pause of such Entry(s) by Originate Bale an madest data is available
to Oniaanng Bank to penin n to aeaba and tmakmt wed Eary(s). m which event Oneonta Bank . 11 tale mea tectal such Eayls). Orin °meg Bak oma no Sim
respmsMliry with mama to such read Eames Except fa as Enry anaacd by Compaq m steam with eft iwmmema of this Apeemt. Ongmanng Balt Mall have m
obligate to rowans art a retuned Envy to the ACH if Onpaamg Bank complied With de Tequseeno of tam Apament Wim metpea in the original Envy.
10. jl.bitaCnvlttt to Cmmoanvs Aregmt.
(a) Company will designate • demand depoat account the 'Company's Acorn') =maned by Comamy at Oripnumg Bask to a ad foe easing feu all
0atiaasao baetadtr.
(b) Comfan manias Ommnmem Bak to debit Company's Account fee the seats of Credit Enna taomad for Comply heammda at such sat on the
Salem Due win =pa to such Esme as Canaan Balt a Io drama. may daemme. It is pend. Sowyer. that Osicmaosg Bank may et wry mt u m opan
regain that Company pay to Oncoming Bak to sauna of Credit Ensue to at proemial haardr ce the at such Coedit Eames an atwed to On(mmng Bak and
Company epee that upon Compays name of nam feta wine or wall from Ofthinaung Bak that mus tegtnrmm t m effect Originating Bat is auTharmd to debet
Company, Account for the soots of all Credit Eames delivered to Onpnamg Bek pursuant to this Apes at or a set me We twelve nape m Me dam such Entries me
Mama to On soma Bak.
55
(c) Ontnmang Bank shall mat Comm a Account for the amounts of Debit Baum aocand for Company hereunder n 10 Sat tat Dau for such Envie: it
bent aJv uaoenood. however. tha so melt to Company s Account on account of a Debit Envy s tawammnat until Ongmsnng Bees maim fiat setdemat fa ooh
Easy. and Ongnamt Bank may turadat to Cower s Account me amount of are Debit Easy mated to Company's Account for wbtch Ongmaim Bank dor not for any
ream maw flat sememet.
(d) Comoanv warms Onpnannt Bae to credit Company s Amami for any anent revved by Om:manes Bank by race of the imam or caeeiadoo of any
Credit Entry transomed by enplanes Bank for wwa Onpnaang Bank pas pfewouaiy caved payment iamb malt to Complays Accmmt o n mail CO the date OnpO®g
Bask Rave coca amaintl, and to debit Company Account for the moa of any fawned Debit Entry (stub debit to Company Aeeoom to be made upon receipt by
Cowman; Bank of the returned Enoyl. and to debit or credit las applicable) Company! Account for my amtmamam made: 10 Earns a corrrased Eames iembmiad
(e) Company also authorOnama ng Bank to debit Compass Account for the fee and chats tas pavtded m Sana Ig hamfl which brae owing to
Onpaain, Bank of =akin of Enmes ptimfed Son pervien provided by Onmamnt Bank for Company bemmda. as and when nen fes beams due. Such fa, and charges
shall be citagsa again me account may= of Company s Accent
(1) Comply shag tamale m Comtism s AaaImt a balance of cottoned fits ffliciem at any time to emu the 10011013 thee to be debuted to Commis Aecoet
Mum to than Amami 1t is undimmed awn and that if. as the time Onpnaag Bade u to debit Cmpeys Meani a Wirt= of a Easy or pap of Eames received by
Ongmang Bank_ men are not atfsdeo enema f 4s a emelt in Company's Arrant to cover the mal Meats me to be debital fa swh Eney(sl. the Ontoneag Bek
shall bays the oat ban not the obbpnoa. to rem any or all of such Eavyla) to the extent n u the menbla fa Ortgmeng Bek to do an. 1t u finita amnesty agreed the if 1
any me Cmpe,s Account doe not comm suffice= collected (mods to cow the amount of Man or caps to Company! Moet due m be rue peewee an dos
Agreement Originating Bank may, bin is e abisgad to. debit Cour s taunt mw overdraft. d Orman g Bask shall not be liable for my Seam to Company r the
result of am debrn or chugs crime as overdraft in Company's Aaant and if such a overdraft is en. Camay apses to repay Ongmeng Bak upon red the
amount of such ovwaaaf! . Comae hereby amonaan Onmsnng Bank to cbage my of Company. Ataorm13 nonmed with Onpaeng Banka my me fa the moat of
such overeat ala Ongmaa; Bank mar sa-off mem any amount t may owe m Company. in moa m oma prymet of Cmpeyi chlaganm oda dos Apt.
(g) Advice of such debits and Media to Company s Account will be tenoned on the peodie same= for Company's Al.ccoun
(hl Company apes and obants toed to Day Onnnang Bank the moms for which Ononag Bank is authatad to debet Comparys Account as the ams on
wtcb Ongmsting Bae is emanated to debit Camoary s Account as neap ppvtad: and Company amens maim miganon to pay MCI comms abet( as be affected any
v
fall or minim at Ongnaant Bank to dent Company a Account for any fon ammo.
11. iftinusuularmanion. The malt of Dent Eames ala Credit Eames nonmed by Onpnat Bek or debtmdmdimd o a Recasts maim at Onpwaat Bmk
will be Meted a the p000m swam tinted by Onpnannt Bank with maw to Company a Account Comm Won 10 nook' Ongiweag Book ..aapdy of an aaatepaay bumf
Company! recoils and the mformatin drown on any men pewee sumnat. If Company fails to goofy Ortganaane Bank of air fah dhaepmq wino Wily (30) day, after amp by
Company of a panodic swami mamma such iaformanon. Cmpey specs dna Ong manng Beek Wal oci be (table for ay cher Iona mating from Cmpeys fails to give such
none, or fa any Wm of mural with resat to Eames mewed n such pectic statement. and Company shall be precluded from assenng such divepmry agora Dapaeag Bank.
12. Cmmpmy Re.e.e.eow.ae ice Aneemco t dean N. n canton with the mars which se the
Bank and wpm War ftlon of this Agreement Comply taPtaas o Orient;
(a) Each person shown as me Reaves on a Credit Eptly caved by Ongmang Bank from Coer has. by an anharimon agreement m as:adance with the
Ruts. ae01tad the tmoavon of etch Entry and the atone of the Raavers moa to the amount and on the Effective Envy Date shown an gab Eery, and has authorial the
mieoo if narmv. of dent ams and adjustments for any Colt Faddy mane metra to the Rmnvers mono:
(b) Each Debit Entry leaved bv Onpaaong Bank from Company is fora sum due and own! to Compmy te the Racer of nth Debit Entry (i.e.. the person to
whew account the Entry is to be dentie or is for a sin specified by such Receiver to be pad to Camay. a is a cotevon of a pmousay ft10mit armmn Credit Lary.
ed eat Receiver nes duly ethonaed sae Eery wan authamon amememt 13 madam with the Rules:
(c) Each sue authorization vim tom to an Entre is weave at the me m mmaatsl or ittnpemdrat by Onpneag Bank as poinded Minn: and at the me
cab Entry is premed by Ongineng Bank. Comae nes no knowledge of moon= by such Roeser of sea amanma. and Company w no knnwidge of any teyepoon
by such Receivers Receiving Depository Finamma Luomon ('RDFr) of to apemen to a=pt such Entry. or any kawldgethat its Raavas aananean for such Entry has
been tmmmaed in whole a in part by opamon of law or omawtse:
(d) Fames transmitted to Onpgmnt Bad by Company are limited to than types of Enures set fah on the Mack= attached beim:
(e) Comm shall fully and may perform is obligations coda this Agreement ed time will be weaned in accordance aim W applicable laws and repdeans
and the Rules as m effect an me to me: ad
(Q Comm shall be bon by and comply w.th the Rules as to efts free me to ma. menmeg. within Iimnmon. the neva iMac( making payment of
Ferny by the RDF1 to the Raver proving mm meat by the RDFT of final seaman for we Easy: ad Campey spafidly acknowledges that an staved sup of
the muMeta fact dm if such settlement is we rsawd. the RDFT shall be ecoid to a ofd from the Raimo of the mom caned and Cmpey til not be deemed to
taw ped the Roar me a of the Entry.
13. 1 inflow. a : nnwue.e bl Min -
(a) Odorant Banks tesocesinlin haeunder shall be limit to the exercise of good faith and otdman can m peifMmmt the semen to be plaided by it
under the of this Agra d Ong:mann! Bek shall not be liable fa m aces a maam a
ahamset der rein the even m ged a co
of peminence. baud wdIM munatt.
Fastener of fbMama compliance with the Rules and con Agreement Wal be deemed w commute good faith ad the Metric of ordinary car by Ontnaaag Bank
hander. Oceawonl untamn0na deutans by Ongnanng Bank front the Rules or this Agreement all not be demi a fails to sense ordinary cm to my a aosecoon.
iodttlme transactions m which devsepot aeon.
fbl
Oncoming Bank shall riot oe manna for Company s acts or omissions thalami. without hmaoa any acs or nam tetany to the moat.
accuse. nmdaeat of transmute or vie aumanann of any Entry. re any failure to empty web the warty meat ues wand henna. a any fame to as in response to any
ocommon rye to Company). or than of any Aeeubemce Bon orovadimg serval to Company. or of any stat or employee of any of mem. or ai any other person or ante.
Indd10e within Ionone any Federal Reeve Baan. automated creating house a trmmien a commemo001u faairy. or any Receiver a RDFS (ineludma. wimnt
limnmme. me ram of an Entry by such Receiver or RDFT). anti no sue persona eery shall be Omen Ongnaonm Baas amt.
(c) Ongoing Bank shall not be liable for any lou mans from Company' fails to deliver or transmit Fames to Gnawing Bank by the omes specified
(a debvety of such Eames set bank herein.
56
f
(d) N pro event nun Ongmauns Bain[ be habit for env pension or any wmsluaoal. epecae. plmtve or uses= loss or damage which Comping ma incur
OT ruder remong from the subject leer of this Agmemat. inciting. wuhout limier loss or damage from sumeuat wear thap000r reining from Onpoaomg Batik -s
acts or omumona pursuant to this Agatmaa, whether or not the likelihood of such loss or damage was finita by Ongmamg Beet.
(5) Without Wemng the generality of the foregoing provisions, Onpnamg Baht shall be excused from failing to an or delay in acing if such failure or delay
is caused by legal consent interne of oanmansion or commmucauon farad. edmpmat Mee war. mergacy cones or otter circumstances bayed Onpn1ng
Banks control. Additionally. Oren; Bank shall be exeusa Som failing to uemut Of delay in treasuring an Entry if sacci tree would result m Onpeaueg Bars
having acceded any heron ups Its mtramv net funds posmon established pursuant to meet or rum Federal Raesve nudtlun or in Onion; Beaks otherwise
',ming any provision of any net or fee nsa control pope of Ne Federal Reaves or my ins or rtgulanon of anY timer U.S. tovemmaW regulatory audety.
(0 Surto to the forgoing imlunons. Onsrsung Banks henry for loss of duet rtsulmg from as error or dela shall be calculated by ming a rate
emum to thc avenge Federal Funds rate at he Federal Reserve Bait of New York for Inc prod ton e
la ComnIt n north can nnry ran.....
(a) If m Eaoy% or a reuat for cancellation Of oma. cm of an Envy. nerd by Orfimaoog Book purport, m have bee trainee or midi Dad by
Cour II will be dented eftauve as Cent Ear, or mem even megh the Eno, or rtes was °a aaWly muhmmd by Cmmany, provided lb° Onpmamg Back
acted is ®puma wee the sere procedure s for m the M euro wracked basin with rept to such Espy or mens awmch army precedne w admaMedee to
be eemmmeally reasonable and nes expressy approved and aped to by the papa bee01ry f nen ecionneu is to be ud as a pmt Of tete sewn procedures.
Oneness Bank shall be dear m have candied with that pan of such proem = if it ampere the see accretes a Alt of Enna. 01 reps far tmasllmoe or
sotedmm of m Entry, mowvad win to s eeemen signature of an authored repaomve of Campay 1, Compemy's Reprente n'1 and. on the hams of such compammn.
believe the apmet accompanying such tale or request to be de of such Communes Rapre®mve.
(b) if an Entry, or nes for eanallma or mneedmmt of in Entry, reeved by Onpmm1111 Bank via nmmne Of aurhonmd by Coappuy. n wtl be
deemed anon as COmpmys Egan m sedate enema or not Orme Bud cure wit de seated Ocoeee Pee fes °sem and in the Addedmm ached hetero
dad semen m than Entry or request and wbecba or not that Enda or newest via eneuus 10 fry It Of OS 11.151114101 read hive oro detected if three Bank had
come dad nice pmaJ_
15. Inar...rtney of Nm d A .mm N msbe. Company aclmowledge ad ape mat. 1f m Eery deabe the Remvar meannmedy by earns amt strum[
number, payment of its Espy may a made by the Rene Depommry Ftraoe4 Income mor by Orme, Beek in the ran Of of On -Us Entry) on ds baa of the 1100011010901011.. ryen
if the account mow Wanes a person different from the named Receiver. and that the epee of Coen to pry de amour of the Emmy as provided ham is am erre m much
cumeamices
16. flaaifIr.nams of fT.aer. Orfgmanng Bank will °only Company of all Nohfmme of Chap need by Onpa®g Bank Maur to Ere transmitted by
Caper by mein{ • copy of such Notificsne of Cep to Company no Wer than one (1) bee day lee Ongmamg Bake in tnef.
17. egeorbaron. N.twithfanth-g erne to the coney m to Ride. Company •hall prowls m Originating Bade fouler (14) care de pram m mento° of
any new Ery, a pmabr .. nerd which shall ger Receivers Dana adam6a°00111 arbor. a®em MSC. Racevmg Dapoegry ROMPS memem's reed meas amen. and
ere ether If Cempey'a proofwoe rsmd is ear by a Recant Deposory Fmmsod ban and Cmpey n w °efiml Comp rte rens ilia reen fm err
racoons°oma pmae lease nerd sed win to pre ebn fourteen (14) neer drys bene aebmamg ttry err Emir for the Reinvests) r qmm.
IS. Fe mrd O..n CorroPeoy ape to pa the anommy fees and are chrpd by Ongammg Bek for providing the seer to be provide by it hmamder.
Suck fees and chars shall be charge m accordance with the Depository Ap.gtas dated May. 1997 Stns feta se chirps shut be dinged ape the rums mdysis of Cooley s
Apes as prowled in Section 10. above.
19. NemNaess l"gE..""""' p"p,,.
(a) Rept as neer aapready provided hemi. 0110111Ing Bek shall amt be noted to as epos any eoa01 or mmucge neve from Company or
dry pea pa+e. or m ponds any nonce or evict to Company Of lay aha peri° weal Imam is airy mus.
(b) 01000.000 Bank shall a ended to rtly a any Warta Oral al °0001 or omatt aral hwOcommmcane dam nod to inn mbjcct mats beacof
beldam( by it In good faith m be gess.
(c) Eames u othewtta emery provided bee any ens nonce or 0601 wren cammmwne required a pemrtnd to be ova med01 this Apemat
shall a dinned. or sent by Unite Sam mail. poroge peen. or by ape ass. and addetad to:
If to Onpoaag Bek:
Ta Pet chewed Bak
100 Ws Hews Stria
P. O. Bea 1600
Sae nark Tana 71296
Mani: Cash Maaa ss Senna. ACH Unit
If m Company:
City of Corpus Christi
P.O. Bel 9277
Corps Chrism TL 78469
AMun: City Treasurer
warm maker admess is subrmted by nonce delivered or sent as provided herrn. Except as otherwise cxpresly provided herrn. any such nag shall be deemed ova what reeved.
20. Dn Ramp n. Comsv shall [earn data on file adequate to emu ansio; of Eames for thirty (30) dpi fdloeg the date of dm ce amal by Onpmoat
Balt as pmvedd het. and Nall provide RICO data to Originating Bank roe its reust.
21. Amari rats.. This Amer may arc mended only nv wont, agrement executed by The Onmaon! Bank and Came bocce of any era +moments shall be
dared ova wee eve {MO is placed in the United Stases mait pose t prepaid rear to Comimy a a rates sown m Sea= 19Ma" or "Ca mer [asinine "mess as
prumdd in Same 19
57
22 F not ., amCollaenl Company agrees mat. auntie existent of this Ame®aet 11 will a my ume and .me to rime upon Onetime. Bank s
,S
rowed nano to Onnnaona Bans a owe. cermet Inc complete finmuai statement with regard to CamoanY pleated on the customary tams reamed by Daman! Bank. Ongnpann; Bahk
than have me nein to at any MC rmusn Nu Company pledge match santtamon to Ongumug Bank to waist 0151I0.51111106 by Campmy ai Company s magma= ander tis Agreement
23. jfila,amen, This Agreement may be temtuwed as oronded in Secure 6.07 of the Depository Agreement dad May 13. 1997, My temmmap of tis Agreement
shall not affect any obligation of my pony hero anent from manes accumng pea to mon mamma oar shall my such lammmte then the pronmoes dueness 12. or 13. hereof
21. Fmmndasint This Agement amduds*g the Addenda attached heron. together sada the Depositary Agnomen wed mow to Commies Account and an.
Secmny Agreameet easmd by Company in coteessite neewth. ccnmmre NO mart speemeat pew® Company and Ongmmng Bank wed act to the subsea mane hereof anc
superman any nor tenements oertme Company and Ongresony Bank nth respect to such mbactmma. to the event any of the terms of this Agreement may be mmastaent ends the
rtrma of the Deoonmry Apemen between Comity and On mann! Book rtmanng to Company a *comm. the dams of this Apeeesmi shall mumu. In the wet oefmmmw of the rams
mended for bean m acmdmn with the rams of tit Apemmt wand result to a nolaore of any Rams or fame amrt• ntvmm a govmmms mac 10 which OnPaamag Beak u
tube. and which !ovens or affect the a nsaonres cantempatd by this Apeemrot them this Agreement shall be domed ammdd to me extent necessary to comply with such eaa
regulation or pont. and Ongioanng Bank shall incur no Bailin to Company u the result of such norm or mepeem.•
•
2:. Noo-Asagmmet. Compmy may not ante this Agreement or my of is nem or dude betemde m my miter panty wnbdn Ongmanay Bark's prior wham mart.
26. Bibalat pmonnem Bradt This Apemen shall be biding upon ad shall am to the beefs of the respective panes ham and their .npemve lees
repeamuaves. successors and permed assigns. This Agreement n not for the benefit of my dee prey winnower. and to such ohm parry Wall have any ngha agama Campy or
Ongutaaug Bank ba code.
27. Hmmnn. Headings an used for ttfesma purposes only and shall a be deemed a pis of this Aptam.
28. fawning Law. Finn ammned under the ems of this Agnomen pall be tranmted meat CO the Roles through toe or mart ammaed nanny boa imp.
as pranced m the Rules Amde 4A of the Uafam Comma Code as enamel an the Sime of New Yak has ban adopted by the Names Autmmd Gaming Nome Aaoeanon to ran
me Rule and me ngbts and oStganom of ret imam w Fames wadi art subsea to said Anode 4A and amoad purma w ileo ann. The pores hats* expressly apes that W nests and
obligations of the pedes bard shall be mimed by and cramped on accooanor win Article 4A of the Uaafam Cammama Celt as eeteted m the Sine of Nay Yak with respect to al
mems aura to Fames maned dada the tams of anis Agreement to the Ml cum that the prenares of said Arndt 4A we apiabie tetra: but asawss this Agree Wad be
governed by and construed m worse= path the laws of the Sine of Teas and any applseahie Fedex Law. The peon berm apes to be bored by and to amply with the Rule. as m
effta from ate to ume. path maim to me sampan mesa of this Ap®m.
29. EXIMI-LOMIDECIthhfiltt. N my portion of this Agreement Would be held to be savaad or mmfaenble for any mama, the remainder hereof Mad not be affaared
Natty.
30. Adlhady. C patty napressen and watt to Onpaamog Bank than u mpawned to nab ad me ore this Apemen and that my prstols) naitag this
Agnmmt on as behalf or admmbed as baying my authority to bed Company are fully aushmmd to so bel Company.
31. Na.Wsiver of Ride. Any delay Of fabs of ether pay beam a my time to renat miasma ofthe other ;my of my proven= of this Apemen Mali mm
we affect the ngls of such party to MUM the perfammet of that or any aha pronate of this ApamR and shall a be eammuad ass wren of that a any aper eels ender this
Ape amt.
IN WITNESS WHEREOF the parties hereto have caused this Agreement to be executed as of the day and year first above written.
COMPANY:
City of Corpus Cb
By:
Name:
Title:
C L a
Approved as to fort
James R. Bray, Jr.
City Attomey
By: >Un A
Assistant City Attorney
ORIGINATING BANK:
TSE FROST Nt�'t[OJ�
BY:
Name- TOM FRO
Title SEPJIQRiiS E "'
PRESIDENT
58
APPENDIX -G F
INVESTMENT POLICY RESOLUTIONS
Oh City of
Corpus
Christi
APPENDIX F
A RESOLUTION
AMENDING THE CITY INVESTMENT POLICY TO: DELETE REFERENCES
TO TEXPOOL INVESTMENT; RETITLE AND RENUMBER SECTIONS OF
THE CITY INVESTMENT POLICY; CLARIFY AND UPDATE INVESTMENT
TERMINOLOGY; AND ADOPTING THE CITY INVESTMENT POLICY AS
AMENDED.
WHEREAS, the City of Corpus Christi Investment Policy was adopted in Resolution No.
022390 on October 24, 1995, amended in Resolution No. 022980 on July 8, 1997; and amended
in Resolution No. 023133 on November 18, 1997;
WHEREAS, City of Corpus Christi Investment Committee reviewed the proposed
amendments to the Investment Policy identified in the attached summary and recommends that
the City Council amend the City Investment Policy to delete reference to Texpool Investment,
retitle and renumber sections of the City Investment Policy, and correct and update investment
terminology in the City Investment Policy; and
WHEREAS, as provided in Section II. C. of the Investment Policy, the City Council
must review the Investment Policy on or before December 31 of each year.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE
CITY OF CORPUS CHRISTI, TEXAS:
SECTION 1. The City Investment Policy is hereby amended and adopted. A summary
of the amendments is attached and incorporated as Exhibit A. A copy of the amended City
Investment Policy is attached and incorporated as Exhibit B.
ATTEST: THE CITY OF CORPUS CHRISTI
City Secretary MAYOR
The City of Corpus Christi
Approved this the 15 day of 0 c-f*yh---1998.
James R. Bray, Jr., City Attorney
By:
•
Mvl
vf.lW
Lisa Aguilar v
Assistant City Attorney
H:\LEG-DIR\NOEM I\LIS AU,OA RES.003
59
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CORPUS CHRISTI, TEXAS
DAY OF , 19
The above resolution was passed by the following vote:
Samuel L. Neal, Jr.
Javier D. Colmenero
Melody Cooper
Alex L. Garcia, Jr.
Dr. Arnold Gonzales
Betty Jean Longoria
John Longoria
Edward A. Martin
Dr. David McNichols
H:\ EG-DIRWOEMN.ISALL OARES.003
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