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The City of Louisville <br /> Investment Policy <br /> It is the policy of the City of Louisville (the "City") to invest public funds in a manner which will <br /> provide the highest investment return with the maximum security while meeting the daily cash <br /> flow demands of the entity and conforming to all Colorado Revised Statutes, the City of <br /> Louisville Charter, and the City of Louisville Municipal Code. <br /> Scope <br /> The provisions of this investment policy shall apply to all funds held in the custody of the City <br /> and all of its offices. Except for cash in certain restricted and special funds, the City shall <br /> consolidate, or "pool", cash and investment balances from all funds to maximize investment <br /> earnings and to increase efficiencies with regards to investment pricing, safekeeping, and <br /> administration. The investment income derived from the pooled cash and investment accounts <br /> shall be allocated to the various funds based on their respective participation and in accordance <br /> with generally accepted accounting principles. <br /> Objectives <br /> In order of priority, the primary objectives of investment activities shall be safety, liquidity, and <br /> yield: <br /> • Safety. Safety of principal is the foremost objective of the investment program. Investments <br /> shall be undertaken in a manner that seeks to ensure the preservation of capital in the <br /> overall portfolio through the mitigation of credit risk and interest rate risk. <br /> • Liquidity. The investment portfolio shall remain sufficiently liquid to meet all operating <br /> requirements that may be reasonably anticipated. This shall be accomplished by structuring <br /> the portfolio so that securities mature concurrent with cash needs to meet anticipated <br /> demands. Furthermore, since all possible cash demands cannot be anticipated, the <br /> portfolio shall consist largely of securities with active secondary or resale markets. In <br /> addition, a portion of the portfolio may be placed in local government investment pools <br /> (LGIPs)which offer same-day, constant dollar liquidity for short-term funds. <br /> • Yield. The investment portfolio shall be designed with the objective of attaining a market <br /> rate of return throughout budgetary and economic cycles, taking into account the investment <br /> risk constraints and liquidity needs. Return on investment is of secondary importance <br /> compared to the safety and liquidity objectives described above. Securities generally shall <br /> be held to maturity with the following exceptions: <br /> o A security with a declining credit may be sold early to minimize loss of principal. <br /> o A security swap would improve the quality, yield, or target duration of the portfolio. <br /> o Liquidity needs of the portfolio require the security to be sold. <br /> Delegation of Authority <br /> The Finance Director shall be the designated investment officer of the City and shall be <br /> responsible for all investment decisions and activities, under the direction of the City Manager. <br /> The Finance Director shall establish investment policy procedures for the operation of the <br /> investment program consistent with this policy. Such procedures shall include explicit <br /> delegation of authority to persons responsible for investment transactions. No person may <br /> 68 <br />