Business & Non-Instructional Operations

3431-BP

 

INVESTMENT POLICY

 

It is the intent of the Board of Education to establish a policy for investment of funds held by Placentia-Yorba Linda Unified School District. The policy also governs the issuance of debt by the district. This policy is based upon federal, state, and local laws, and prudent money management practices. To the extent that this policy conflicts with applicable law, the applicable law shall prevail. The primary goals of this policy are:

  1. To assure compliance with all federal, state, and local laws governing the investment of monies and the issuance of debt.
  2. To protect the principal deposits of the district.
  3. To generate investment income within the parameters of this policy.

The district's primary investment objective shall be to maintain the safety and liquidity of its funds. Safety of principal is the foremost objective of the district. The investment factors the district shall consider, in order of descending importance, are the following:

  1. Safety of invested funds.
  2. Sufficient liquidity to meet future cash flow requirements.
  3. Attain maximum yield consistent with the aforementioned requirements.

In addition, the district shall adopt measures as set forth herein to ensure that the issuance of debt by the district complies with all applicable state and federal laws, including federal and state securities laws.

The Assistant Superintendent, Administrative Services, for the district, under the direction of the Superintendent, shall have the responsibility for all decisions and activities performed under the district's investment policy. The Assistant Superintendent, Administrative Services, shall have the ability to allocate resources or delegate responsibility as necessary to optimize the safety and liquidity of the investment portfolio within the parameters established by the Board of Education in this investment policy.

Legal Constraints:

Pursuant to California Education Code, Section 41001, the district shall deposit all funds received or collected from any source into the Orange County Treasury, to be placed to the credit of the proper fund of the district, except as otherwise provided herein.

Pursuant to California Education Code, Section 41015, the district may invest all or part of funds deposited in a Special Reserve Fund or any surplus monies not required for the immediate necessities of the district in any of the investments specified in California Government Code, Sections 16430 or 53601. Special Reserve Funds are defined as those funds which the Board of Education has designated for capital outlay or other purposes, where an accumulation over a period of fiscal years is desired.

Authorized Investments

The district shall make investments in the context of the "Prudent Investor Rule" (Probate Code Section 16045, et seq.), which in substance states that:

Investment shall be made with the 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."

The district shall deposit all funds received or collected from any source into the Orange County Treasury, except as provided for through the California Education Code. Those funds maintained in a Special Reserve Fund or any surplus funds not required for the immediate necessities of the district shall be available for investment ("funds available for investment") under the conditions set forth in this policy.

  1. The Orange County Investment Pool(s) established by the Orange County Treasurer for the benefit of local agencies and/or schools. The district may invest up to one-hundred percent (100%) of its funds available for investment in the Orange County Investment Pool(s).
  2. The Local Agency Investment Fund established by the California State Treasurer for the benefit of local agencies and or schools. The district may invest up to one-hundred percent (100%), of its funds available for investment in the Local Agency Investment Fund.
  3. To the extent that the district directs the investment of its funds to specific securities, those securities shall be limited to the securities identified in California Government Code, Section 53601.

Monies received from the sources, or for the purposes, listed below may be deposited in a bank or other financial institution. Monies so deposited shall be in a fully-insured

or collateralized account(s) or instrument(s). Bank accounts maintained outside of the County Treasury shall be limited to the following purposes:

  1. Revolving Cash
  2. Associated Student Body Accounts
  3. Self-Insurance Funds
  4. Proceeds of Debt Issuances
  5. Cafeteria Fund
  6. Income awaiting deposit for all funds

Compliance With State and Federal Securities Laws

The district will take reasonable steps to ensure that any debt offerings issued by the district comply fully with all applicable state and federal securities laws. In connection with all debt offerings issued by the district, the district will retain such expert counsel as needed to review the offering materials prepared in connection with the debt offering to ensure that disclosures contained in offering materials comply with federal and state securities laws. The Assistant Superintendent, Administrative Services, shall be responsible for reviewing the offering materials regarding the accuracy of information disclosed in such materials.

Deposit of Proceeds from the Issuance of Debt

The district shall not issue debt for the sole purpose of generating funds for investment. The district shall limit the issuance of debt for the purposes of meeting short term cash flow needs and to fund capital projects.

When depositing proceeds from the issuance of debt, the district shall limit such investments to those authorized investments identified in this policy. Should a trust agreement of a particular debt issued by the district be more restrictive that the district's policy on authorized investments, then the trust agreement will take precedence.

Investment Reviews

The Assistant Superintendent, Administrative Services, will review quarterly reports on investment performances.

Changes to Investment Policy

This Policy will be reviewed at least annually to ensure its consistency with the objectives of income, growth and safety, and changes in applicable laws and financial trends. Any proposed amendments to the Investment Policy will require approval by the Board of Education.

Financial Professionals' Compliance with Investment Policy

All outside investment advisors/managers, attorneys, and other financial professionals employed or retained by the district and/or its representatives, including without limitation financial advisors, underwriters, bond counsel, and disclosure counsel, must review this policy and sign a statement of compliance confirming that they have reviewed this investment policy and will fully comply with these policies, as set forth in Exhibit A.

 

 

Legal Reference:

Education Code

Section 41001

 

 

 

Section 41015

 

 

Government Code

Section 16430

 

 

 

Section 27100.1

 

 

 

Section 53601

 

 

Probate Code

Section 16045, et seq.

 

 

 

Policy adopted:

6/11/96

Policy revised:

3/10/98

Policy revised:

3/23/99

Policy revised:

3/26/00

Policy revised:

3/27/01

Policy revised:

3/28/01

Policy revised:

10/8/02

Policy reviewed:

3/25/03

 

Business & Non-Instructional Operations                                                                                    3431-E

 

 

INVESTMENT POLICY

EXHIBIT A

 

STATEMENT OF COMPLIANCE WITH INVESTMENT POLICIES

ADOPTED BY PLACENTIA-YORBA LINDA UNIFIED SCHOOL DISTRICT

 

 

The undersigned has been retained to perform services for the Placentia-Yorba Linda Unified School District.  The undersigned has been provided with a copy of the Placentia-Yorba Linda Unified School District Investment Policy and has reviewed the Investment Policy thoroughly.  In providing services to the district, the undersigned agrees to comply fully with all of the policies and procedures set forth in the Investment Policy.

 

 

 

Date _______________________

 

By:  ________________________

 

____________________________

Printed Name and Title