§ 2-41. Investment of surplus funds  


Latest version.
  • (a) Interpretation. This section shall not be interpreted in such a manner as to restrict the capability of the county to invest its surplus funds in accordance with general law and is intended to extend the ability of the county to invest in other items deemed prudent by the county. Nothing herein contained shall be interpreted or construed to abrogate any specific provision contained in any bond resolution or other contractual agreement of the county, or other requirements of general law of the state relating to the investment of bond proceeds or other such monies temporarily available in specific funds or accounts.

    (b) Penalty. A violation of this section shall be punishable as provided by law.

    (c) Investment Policy Committee. The County Investment Policy Committee is created as follows:

    (1) The committee shall be comprised of seven (7) voting members, five (5) members appointed by and serving at the pleasure of the majority of the Board of County Commissioners, a member of the Office of Financial Management and Budget selected by the County Administrator, and the County Sheriff or his designee as the seventh voting member. Committee members must be residents of the County and remain so during their terms in office. If the chairperson of the committee is absent for all or any portion of the meeting, the vice chairperson will conduct the meeting. Failure to attend three (3) consecutive committee meetings, or failure to attend at least one-half (½) of the meetings in a calendar year, is grounds for the automatic removal of a committee member. Participation in less than three-fourths (¾) of a meeting shall be the same as failure to attend the meeting. The Board of County Commissioners may, by majority vote, remove a committee member without cause.

    (2) Members of the committee shall be appointed with the following backgrounds:

    a. A current member of the Board of County Commissioners, who shall serve as chairperson and decide all tie votes.

    b. The County Sheriff or his designee.

    c. A member of the Office of Financial Management and Budget selected by the Administrator.

    d. Four (4) members, having any combination of the following backgrounds and experiences (no category having more than two (2) members): experience in the investment banking community or securities community with five (5) years direct investment experience and present investment management responsibility; member of the public with substantial investment or securities experience; or a local banker with a minimum of five (5) years direct investment experience and present investment management responsibility.

    (3) Committee members appointed by the Board of County Commissioners serve three-year terms, with a limit of three (3) consecutive terms. Terms shall begin on October 1 and end on September 30. Terms for members who were appointed prior to March 1, 2013 shall end on September 30, 2016. Those members may serve for three (3) additional terms. Any vacancy occurring during a term shall be filled for the unexpired portion of the term, and shall not count toward the member's term limits. Committee members must reside in the County at the time of appointment and while serving on the committee.

    (4) The committee shall be subject to the uniform policies and procedures established by the Board of County Commissioners as currently set forth in Resolution R-2013-0193, as may be further amended by action of the Board of County Commissioners.

    (5) A quorum must be present for all committee meetings. A majority of the members appointed shall constitute a quorum. All committee meetings shall be governed by Robert's Rules of Order.

    (6) Committee members shall be governed by the applicable provisions of the state Ethics Code and the applicable provisions of the Palm Beach County Code of Ethics.

    The committee and the Clerk shall develop written policies in accordance with subsection (f) which shall serve as guidelines for use in the investment of surplus County funds and shall evaluate the effectiveness of the policies and investment practices of the County. The committee shall meet at least three (3) times a year or at the call of the chairperson.

    (d) Investments authorized. When in the judgment of the Clerk of the Board of County Commissioners, as custodian of county funds, surplus monies have accumulated in county accounts or funds or when the county has on hand or has accumulated surplus monies by reason of the sale of its own securities, the Clerk shall make investments on behalf of and in the name of the Board of County Commissioners. Investment decisions will consider cash needs and cash flow projections which shall be developed and provided by county administrative staff. For the purposes of this section, the term "surplus funds" is as defined in F.S. § 125.31(4). Surplus county funds may be invested at the then prevailing market price for such securities in the following:

    (1) The Local Government Surplus Funds Trust Fund.

    (2) Negotiable direct obligations of, or obligations, the principal and interest of which are unconditionally guaranteed by the United States Government at the then prevailing market price for such securities.

    (3) Nonnegotiable interest-bearing time certificates of deposits or savings accounts in banks organized under the laws of this state, in national banks organized under the laws of the United States and doing business and situated in this state, in savings and loan associations which are under state supervision, or in federal savings and loan associations located in this state and organized under federal law in federal supervision, provided that any such deposits are secured by collateral as may be prescribed by law.

    (4) Bankers acceptances which are eligible for purchase by the Federal Reserve System.

    (5) Prime commercial paper. For the purpose of this section, "prime" commercial paper shall be defined as that commercial paper which has received a Standard and Poors rating of at least A-1 and/or Moody's rating of at least Prime-1.

    (6) Interest-bearing obligations with a fixed maturity of any corporation within the United States, if such obligations are rated by at least two (2) nationally recognized rating services in any one (1) of the two (2) highest classifications approved by the Comptroller of the Currency for the investment of the funds of national banks.

    (7) Obligations of the Federal Farm Credit Banks, Federal Home Loan Mortgage Corporation, or Federal Home Loan Bank or its district banks, including Federal Home Loan Mortgage Corporation participation certificates, or obligations guaranteed by the Government National Mortgage Association.

    (8) Obligations of the Federal National Mortgage Association, including Federal National Mortgage Association participation certificates and mortgage pass through certificates guaranteed by the Federal National Mortgage Association.

    (9) Shares of funds created by the Florida Counties Investment Trust or shares or interests in other investment trusts authorized by Florida law for investment by municipalities or counties.

    (10) Investments in any securities authorized by subsections (d)(2), (7) and (8) and may be under repurchase agreements or reverse repurchase agreements.

    (11) Shares of any no-load money market mutual fund ("MMMF") registered with the Securities and Exchange Commission under the Investment Company Act of 1940, the shares of which are registered under the Securities Act of 1933, which is rated in the highest rating category of a nationally recognized statistical rating organization (NRSRO), and the portfolio of which is limited to:

    a. Direct obligations of the United States Government or any agency or instrumentality thereof. Investment in CMOs, REMICS, or other derivative securities are prohibited.

    b. Repurchase agreements fully collateralized by United States government obligations, provided such MMMF takes delivery of such collateral either directly or through an authorized third party custodian.

    (e) Criteria for authorized investments. Investments shall be made with judgment and care, under circumstances then prevailing, which persons of prudence, discretion and intelligence exercise in the management of their own affairs, not for speculation, but for investment, considering the probable safety of their capital as well as the probable income to be derived.

    (f) Development of investment policies. Investments of county funds shall be made in accordance with written policies developed by the Investment Committee and the Clerk, and presented to the Board of County Commissioners for their review and approval by resolution. Such investment policies shall address liquidity, diversification, safety of principal, yield, maturity, and quality, with primary emphasis on safety and liquidity; the selection of qualified dealers and institutions for execution of investment transactions, and the capability of investment management.

    (g) Trust receipts, etc., authorized. The Clerk of the Board of County Commissioners, as custodian of county funds, is authorized to accept, on behalf of and in the name of the Board of County Commissioners, bank trust receipts from a third-party bank, as evidence of investment of temporarily idle funds in lieu of physical delivery of the obligations or securities, to a safe deposit box as required in F.S. § 125.31(2)(a). All such trust receipts shall describe the various obligations or securities held, together with the specific number of each obligation or security held. The actual obligations or securities on which trust receipts are issued may be held by any third-party bank depository chartered by the United States government or the state, meeting qualifying criteria as set forth in the county's investment policy.

    (h) Sale of securities. The Clerk is authorized to sell such obligations or securities purchased pursuant to this article at the then prevailing market price, and to pay the proceeds of such sale into the proper accounts or funds of the county and shall not be liable for any loss of principal interest resulting from such transactions.

(Ord. No. 87-11, §§ 2—12, 6-9-87; Ord. No. 93-25, § 1, 9-21-93; Ord. No. 94-25, §§ 1, 2, 10-18-94; Ord. No. 95-19, §§ 1, 2, 5-16-95; Ord. No. 03-023, § 1, 6-17-03; Ord. No. 2009-020, § 1, 7-21-09; Ord. No. 2013-031, § 1, 11-19-13)

refstatelaw

Investment of surplus public funds, F.S. § 125.31.