DFA: Revenues from Investment

Policy

Scope

The Board directs that the investing authority of the District resides with its Chief Executive Officer (CEO) or their designee.  This policy is designed to cover all monies under the control of the Board.

Objectives and Guidelines

The following investment objectives are applied in the management of the District’s funds:

• Liquidity: The investment portfolio remains sufficiently liquid to enable the CEO or their designee to meet reasonably anticipated operating requirements.
• Safety: Investments are undertaken in a manner consistent with State law, which seeks to ensure the preservation of public funds.
• Income: The CEO or their designee strives to achieve a fair and safe rate of return on the investment portfolio over the course of budgetary and economic cycles, taking into account State law, safety considerations and cash flow requirements.
• Diversification: The investment portfolio should be diversified in order to avoid incurring potential losses regarding individual securities that may not be held to maturity, whether by erosion of market value or change in market conditions.
• Prudence: Investments are 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.
• Bank Accounts: Relationships with banks are managed in order to secure adequate services while minimizing costs.  Deposits should be concentrated in single accounts except where audit control considerations dictate otherwise.

Authorized Financial Institutions and Dealers

U.S. Treasury and agency securities purchased outright are made only through a member of the National Association of Securities Dealers, through a bank, savings bank or savings and loan association regulated by the Superintendent of Financial Institutions or through an institution regulated by the Comptroller of the Currency, Federal Deposit Insurance Corporation or board of governors of the Federal Reserve System.

• Repurchase agreements are transacted through banks and/or eligible dealers consistent with State law.
• Certificates of deposit are transacted through commercial banks or savings and loans with FDIC coverage, and qualify as eligible financial institutions under State law.

Maturity

To the extent possible, the CEO or their designee attempts to match the District’s investments with anticipated cash flow requirements.  Unless matched to a specific cash flow requirement, the CEO or their designee will not directly invest in securities maturing more than five years from the date of purchase.

Derivatives

Investments in derivatives are strictly prohibited.  A derivative means a financial instrument or contract or obligation whose value or return is based upon or linked to another asset or index, or both, separate from the financial instrument, contract or obligation itself.  Additionally, any security, obligation, trust account or instrument that is created from an obligation of a federal agency or instrumentality or is created from both is considered a derivative instrument.

Allowable Investments

The CEO or their designee may invest in any instrument or security authorized in State law as amended. 

A copy of the appropriate section of the Ohio Revised Code is kept with this policy.

Collateral

All deposits are collateralized pursuant to State law.

Reporting

The CEO or their designee reports and maintains records of all investments and deposits.

All brokers, dealers and financial institutions initiating transactions with the investment authority by giving advice or executing transactions initiated by the investment authority must acknowledge their agreement to abide by the investment policy’s content.

Internal Controls

The investing authority establishes a system of internal controls, which are documented in writing.  The internal controls are reviewed periodically by an independent auditor.  The controls are designed to prevent loss of public funds due to fraud, employee error and imprudent actions by employees and officers of the District.

History

• Adopted: December 17, 2019

Legal References

• Intergovernmental Cooperation Act Chapter 52
• Ohio Revised Code Section 135.01
• Ohio Revised Code Section 135.02
• Ohio Revised Code Section 135.03
• Ohio Revised Code Section 135.032
• Ohio Revised Code Section 135.04
• Ohio Revised Code Section 135.05
• Ohio Revised Code Section 135.06
• Ohio Revised Code Section 135.07
• Ohio Revised Code Section 135.08
• Ohio Revised Code Section 135.09
• Ohio Revised Code Section 135.10
• Ohio Revised Code Section 135.101
• Ohio Revised Code Section 135.102
• Ohio Revised Code Section 135.103
• Ohio Revised Code Section 135.104
• Ohio Revised Code Section 135.105
• Ohio Revised Code Section 135.106
• Ohio Revised Code Section 135.11
• Ohio Revised Code Section 135.12
• Ohio Revised Code Section 135.13
• Ohio Revised Code Section 135.14
• Ohio Revised Code Section 135.141
• Ohio Revised Code Section 135.142
• Ohio Revised Code Section 135.143
• Ohio Revised Code Section 135.144
• Ohio Revised Code Section 135.145
• Ohio Revised Code Section 135.15
• Ohio Revised Code Section 135.16
• Ohio Revised Code Section 135.17
• Ohio Revised Code Section 135.18
• Ohio Revised Code Section 135.181
• Ohio Revised Code Section 135.182
• Ohio Revised Code Section 135.191
• Ohio Revised Code Section 135.20
• Ohio Revised Code Section 135.21