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LCityof <br />Louisville FINANCIAL POLICIES <br />COLORADO • SINCE 1878 <br />Investment Policies <br />Policy Section: 6 <br />Adopted by Resolution No. , Series <br />Effective Date: <br />Purpose and Scope <br />It is the policy of the City of Louisville to invest public funds in a manner which will provide the <br />highest investment return with the maximum security while meeting the daily cash flow demands <br />and conforming to all Colorado Revised Statutes, the City of Louisville Charter, and the City of <br />Louisville Municipal Code. <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 />Policies <br />6.1 Objectives. In order of priority, the primary objectives of investment activities shall be <br />safety, liquidity, and yield: <br />• Safety. Safety of principal is the foremost objective of the investment program. <br />Investments shall be undertaken in a manner that seeks to ensure the preservation of <br />capital in the 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 <br />structuring the portfolio so that securities mature concurrent with cash needs to meet <br />anticipated demands. Furthermore, since all possible cash demands cannot be <br />anticipated, the portfolio shall consist largely of securities with active secondary or resale <br />markets. In addition, a portion of the portfolio may be placed in local government <br />investment pools (LGIPs) which offer same -day, constant dollar liquidity for short -term <br />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 <br />investment risk constraints and liquidity needs. Return on investment is of secondary <br />30 <br />