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HomeMy WebLinkAbout06-27-16 C3. Res. 4697 - Board of Investments Commission Memorandum REPORT TO: Honorable Mayor and City Commission FROM: Laurae Clark, City Treasurer Anna Rosenberry, Administrative Services Director SUBJECT: Resolution 4697 / Authorizing Participation in the Board of Investments of the State of Montana Short Term Investment Pool (STIP) and authorizing the execution and delivery of documents related thereto. MEETING DATE: June 27, 2016 AGENDA ITEM TYPE: Consent RECOMMENDATION: Approve Commission Resolution No. 4697 / Authorizing Participation in the Board of Investments of the State of Montana Short Term Investment Pool (STIP) and authorizing the execution and delivery of documents related thereto. BACKGROUND: The Board of Investments at its November 2015 meeting adopted new requirements for local governments participating in the Short Term Investment Pool (STIP). Beginning Fiscal Year 2017, local governments participating in STIP must adopt a STIP resolution that includes a STIP Participation Information Sheet (Exhibit A) and an Electronic Funds Transfer Authorization Form (Exhibit B). This resolution requires the governing body to designate an Authorized Representative to transact STIP on behalf of the local government; a bank name and account number to be used specifically for STIP transactions; and the earnings distribution method of the STIP account. The City has been investing in the Short Term Investment Pool for many decades. FISCAL EFFECTS: This resolution will allow the City of Bozeman to continue to invest in the Board of Investments Short Term Investment Pool as we have done for many years. ALTERNATIVES: As suggested by the City Commission. Attachment: Resolution No.4697 STIP Exhibit A STIP Exhibit B Report compiled on: June 15, 2016 16 CERTIFICATE AS TO RESOLUTION AND ADOPTING VOTE I, the undersigned, being the duly qualified and acting recording officer of the City of Bozeman, Montana (the “City”), hereby certify that the attached RESOLUTION OF THE CITY COMMISSION OF THE CITY OF BOZEMAN, MONTANA, AUTHORIZING PARTICIPATION IN THE BOARD OF INVESTMENTS OF THE STATE OF MONTANA SHORT TERM INVESTMENT POOL AND AUTHORIZING THE EXECUTION AND DELIVERY OF DOCUMENTS RELATED THERETO (the “Resolution”) and Exhibits A and B thereto are true and correct copies of the Resolution and Exhibits A and B on file in the original records of the Participants and in my legal custody; that the Resolution and Exhibits A and B were duly approved and adopted by the City Commission of the City of Bozeman at a meeting on June 27, 2016, and that the meeting was duly held by the City Commission and was attended throughout by a quorum, pursuant to public notice of such meeting as required by law; and that the Resolution and Exhibits A and B have not as of the date hereof been amended or repealed. I further certify that, upon vote being taken n the Resolution at said meeting, the following commissioners voted in favor thereof: _____________________________________; voted against the same ________________________________________; abstained from voting thereon: _______________________; or were absent: ______________________. WITNESS my hand officially this 28th day of June, 2016. ______________________________ Robin Crough City Clerk 17 COMMISSION RESOLUTION NO. 4697 A RESOLUTION OF THE CITY COOMMISSION OF THE CITY OF BOZEMAN, MONTANA, AUTHORIZING PARTICIPATION IN THE BOARD OF INVESTMENTS OF THE STATE OF MONTANA SHORT TERM INVESTMENT POOL (STIP) AND AUTHORIZING THE EXECUTION AND DELIVERY OF DOCUMENTS RELATED THERETO. ARTICLE I DEFINITIONS Section: 1.01 The following terms will have the meanings indicated below for all purposes of this Resolution unless the context clearly requires otherwise: Section 1.02 Account shall mean a specific Participant Bank account assigned by the Bank to be used in conduction transactions through the STIP Program. Section 1.03 Agreement shall mean the agreements of the Participant as contained within this Resolution. Section 1.04 Authorized Representative shall mean the officer or official of the Participant designated and duly authorized by the Governing Body as set forth below to enable the Participant’s participation in the STIP Program. 18 Section 1.05 Authorized Delegate shall mean any lawful officer, official or employee of the Participant who has been delegated authority by the Authorized Representative as provided in the Resolution to initiate transactions using the Board’s STIP Program. Section 1.06 Bank shall mean a financial institution designated and authorized as provided in this Resolution to send and receive money on behalf of the Participant for purposed of participation in the STIP Program. Section 1.07 Board shall mean the Board of Investments of the State of Montana, a public body corporate organized and existing under the laws of the State and its successors and assigns. Section 1.08 Exhibit A (STIP Participation Information Sheet) shall mean the document attached to and incorporated into this Resolution as provided in Article IV, Section 4.01 that provides information necessary for the Participant to participate in STIP. Section 1.09 Exhibit B (electronic Funds Transfer Authorization Form) shall mean the document attached to and incorporated into this Resolution as provided in Article IV, Section 4.01 that provides instructions for the Board and its agents to administer and manage the Participant’s participation, transactions and shares in the STIP Program. Section 1.10 Governing Body shall mean the governing body of the above-named political subdivision (Participant) authorized by Montana state law to participate in the STIP Program as further specified in this Resolution. Section 1.11 Participant shall mean the political subdivision requesting participation in the Board’s Short Term Investment Pool. Section 1.12 Short Term Investment Pool, STIP, or Program shall mean the Board’s Short Term Investment Pool Program as authorized by law and as more fully defined and described in the Board’s policies and procedures, as may be amended from time to time. 19 ARTICLE II SHORT TERM INVESTMENT POOL PARTICIPATION AGREEMENT Section 2.01 Participation Agreement. By approving and adopting this Resolution and Exhibits A and B, the City Commission of the City of Bozeman, Montana requests and agrees to participation of Participant in the STIP Program, and agrees that Participant will comply with and be bound by all laws, policies, procedures and participation requirements applicable to the STIP Program, as may be amended from time to time. Section 2.02 STIP Program Description. The STIP Program is an investment program administered under the direction of the Montana Board of Investments as authorized by the Unified Investment Program. As more fully set forth in Board policies and procedures, STIP is available to state and local governments to serve their short term cash flow and deposit needs and it objectives are to preserve capital and to maintain high liquidity. The Program has the following attribu6tews, as more fully set forth in applicable Board policies, procedures and participation requirements, which are subject to change upon the sole determination of the Board: 1) STIP transactions are fixed at $1 per share; 2) STIP interest on pool assets accrues daily: 3) STIP earnings distribution method: Interest is distributed at the beginning of the month and can be distributed as cash to the designated Bank or the earnings can be reinvested into STIP; 4) Buying or selling shares in STIP requires one (1) business days’ notice; transactions for which notice is received after 2:00 p.m. will be processed two (2) business days after receipt of the original notice; 5) Access to STIP is only through an electronic, web-based portal; no cash, checks or notifications by fax, phone or email will be accepted; 20 6) STIP’s web portal provides real-time information on each account including: investment balances, buys, sells, pending transactions, and transaction notes, as determined by the authorized user; and 7) The Board accounts and reports on its financial statements STIP investment on a Net Asset Value (NAV) basis. A NAV per share of a STIP unit will be shown on the Board’s website for each month-end period http://investmentmt.con/MonthlyNetAssetValue. Section 2.03 Review of Policies, Procedures and Participation Requirements. Participant acknowledges and represents that it has reviewed to its satisfaction all Board policies, procedures and participation requirements applicable to the STIP Program. http://investmentmt.com/STIP. Section 2.04 Authorized Representative: The City Commission of the City of Bozeman, Montana designates Laurae Clark, who holds the position of Treasurer as the Participant’s Authorized Representative to make transactions between STIP and the Bank. The City Commission of the City of Bozeman, Montana: (check one) DOES ( X ) does not ( ) allow the Authorized Representative to appoint and delete additional Authorized Delegate(s) on behalf of the Participant. If “DOES” is checked, any addition or deletion of an Authorized Delegate requires notice via the submission of a completed Exhibit A (STIP Participation Information Sheet) to the Board by the Authorized Representative before transactions will be accepted and processed as directed by the Authorized Delegate. The City Commission of the City of Bozeman, Montana designates and authorizes Participant’s Bank, (the Bank), identified in Exhibit B attached, designation the Account Number and ABA Number to send or transfer funds to the State Treasurer for the purchase of STIP shares and to deposit distributions of and withdraw proceeds resulting from sales of STIP shares in the Bank’s Account identified in Exhibit B attached which is a (check one) checking account ( X ) savings account ( ). The City Commission of the City of Bozeman, Montana: (check one) DOES ( X ) DOES NOT ( ) allow the Authorized Representative to change either the Bank or the Account; if ‘DOES’ is 21 checked, the Board will notify both the office of the Authorized Representative AND the office of the Governing Body within three (3) business days that such a change has been made. The City Commission of the City of Bozeman, Montana: (check one) DOES ( X ) DOES NOT ( ) ALLOW THE Authorized Representative to change the earnings distribution method; if DOES NOT is checked, the City Commission of the City of Bozeman, Montana chooses the following earnings distribution method (check one) reinvest cash earnings into STIP ( ) distribute cash earnings to the Bank ( ). Section 2.05 Change of Authorized Representative. Any change to the Authorized Representative requires a new Resolution adopted by the City Commission of the City of Bozeman, Montana; however the absence of an Authorized Representative does not nullify the authority of the Authorized Delegate(s) then in effect and so authorized to make STIP transactions. Section 2.06 Annual Confirmation. The Board will provide on an annual basis to both the City Commission of the City of Bozeman, Montana and The authorized Representative the following information as appears on the Board’s records: 1. The name of the Authorized Representative; 2. The name(s) of any Authorized Delegate(s); and 3. The name of the Bank and the associated Account Number (truncated). Section 2.07 Effective Date Participant’s Agreement as set forth in this Resolution will take effect when the Certificate as to Resolution and Adopting Vote, this Resolution and Exhibits A and B, each completed, dated and duly executed, are delivered to and received by the Board and will stay in effect until terminated in writing by the City Commission of the City of Bozeman, Montana. ARTICLE III MISCELLANEOUS 22 Section 3.01 No Guaranteed Return. The Governing Body understands and agrees that there is no minimum or maximum amount of interest rate or any guaranteed rate of return on STIP shares or funds invested in STIP shares. Section 3.02 Voluntary Participation. By adopting this Resolution, the City Commission of the City of Bozeman, Montana acknowledges that it is not compelled to participate in STIP, and that its participation in STIP is voluntary, and accepts and agrees to the Program, its administration and governance, and its policies, procedures and participation requirements as set forth by law and the Board. Section 3.03 Responsibility for Participant Mistakes. The City Commission of the City of Bozeman, Montana and Participant agree to hold the State of Montana, the Board, and their members, officials and employees harmless for the acts, omissions and mistakes of the Participant, Governing Body and their members, officials and employees, including but not limited to: Authorized Representative or Authorized Delegate who, for any reason, is not qualified or properly listed with the Board as a permissible representative to authorize transactions using the STIP Program; wrong instructions as to amounts or timing of sales or purchases; or missed deadlines. Section 3.04 No Warranty. The City Commission of the City of Bozeman, Montana and Participant acknowledge and agree that the Board makes no warranty that funds will be immediately available in the event of any failure of a third party or that Governing Body will not suffer losses due to acts of God, or other calamities, or other market dislocations or interruptions. Section 3.05 Participation Conditions; STIP Administration. The City Commission of the City of Bozeman, Montana and Participant acknowledge and agree that the Board will allow participation in STIP by and conduct STIP business with only those parties it determines are qualified and authorized to participate in the Program and which abide by the Board’s policies, procedures and participation requirements; that the Board administers the STIP Program subject to Montana law and prudent fiduciary practices as required by Montana law and Board policy; 23 and that the Board is legally bound to manage the Unified Investment Program, which includes STIP, in accordance with the prudent expert rule as set forth in Montana law. Section 3.06 STIP Not Insured Against Loss. The Governing Body and Participant understand and acknowledge that the Board’s STIP Program is NOT FDIC insured or otherwise insured or guaranteed by the federal government, the State of Montana, the Board or any other entity against investment losses. The Governing Body and Participant further understand and acknowledge that the Board’s STIP policy requires maintenance of a reserve fund to offset possible losses and that STIP interest earnings may be used to fund this reserve before the net earnings are distributed to the STIP Participants, but that such reserves may not be adequate to cover investment losses. ARTICLE IV EXHIBITS A AND B Section 4.01 Approval and Adoption of Exhibits A and B. Attached to the Resolution as Exhibits A and B, are the STIP Participation Information Sheet, and the Electronic Funds Transfer Authorization Form, which together provide the instructions and the details required by the Board to enable Participant’s participation in the STIP Program. The Governing Body and Participant represent and agree that he attached Exhibits A and B have been completed and executed by the Participant’s Authorized Representative and that Exhibits A and B must be complete and acceptable to the Board before participation will be allowed in the STIP Program. Exhibits A and B are hereby incorporated into and made a part of this Resolution, and are approved and adopted by the Governing Body as if set forth fully herein. PASSED AND APPROVED by the City Commission of the City of Bozeman, Montana, at a regular session thereof held on the 27th of June, 2016. ____________________________________ CARSON TAYLOR Mayor 24 ATTEST: ___________________________________ ROBIN CROUGH City Clerk ____________________________________ GREG SULLIVAN City Attorney 25 26 27