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HomeMy WebLinkAboutItem 12 - Texstar Investment PoolMEMO TO FROM: MEETING DATE: SUBJECT: RECOMMENDATION: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL ROGER NELSON, CITY MANAGER OCTOBER 21, 2003 RESOLUTION AUTHORIZING APPLICATION FOR TEXSTAR INVESTMENT POOL City Council to consider a resolution authorizing an application for participation in the Texas Short Term Asset Reserve Program (TexSTAR) and authorizing the City Manager to execute said application. FUNDING SOURCE: There is no cost for joining TexSTAR. BACKGROUND: First Southwest Asset Management Company started an investment pool for public entities in 2002. Since its inception, it has grown to include over 120 municipal participants with deposits in excess of $1 billion. TexSTAR average monthly rate yields are competitive with TexPool and other governmental investment pools in Texas, currently running at 1.24%. A copy of the TexStar monthly yield summary and an information sheet on TexSTAR is attached. By adding this service to our investment portfolio, we will achieve additional diversification of investment funds with a safe and dependable service which can provide enhanced yields from time to time. The City Council Audit Committee and City Staff recommend approval. WAG/cjc H AGMTexStarl 0-21-03 October 16, 2003 (8:56AM) RESOLUTION NO. 0 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF GRAPEVINE, TEXAS, AUTHORIZING AN APPLICATION FOR PARTICIPATION IN THE TEXAS SHORT TERM ASSET RESERVE PROGRAM (TexSTAR); AND PROVIDING AN EFFECTIVE DATE WHEREAS, it is in the best interest of the City of Grapevine to invest its funds jointly with other Texas local governments in the Texas Short Term Asset Reserve Program (TexSTAR) in order to preserve and safeguard the principal and liquidity of such funds and to earn an acceptable yield; and WHEREAS, the City of Grapevine is authorized to invest public funds under its control, pursuant to Chapter 2256 of the Local Government Code, the Public Funds Investment Act; and, to invest said funds in TexSTAR and to enter into a participation agreement with TexSTAR; and NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF GRAPEVINE, TEXAS: Section 1. That the form of the application for participation in TexSTAR, attached to this Resolution as attachment number 1, is approved; and, appropriate terms used in this Resolution shall have the meaning given to them by the application. Section 2. That the City Manager of the City of Grapevine is authorized to execute the application for participation in TexSTAR and any additional documents required to complete the application in the participation process. Section 3. That the designated investment officers of the City of Grapevine: Roger Nelson, City Manager; Bruno Rumbelow, Assistant City Manager; William A. Gaither, Director of Administrative Services; Fred L. Werner, Managing Director of Financial Services are authorized to execute documents relative to TexSTAR, open accounts, deposit and withdraw funds, designate other representatives, and to take all other action required or permitted under the TexSTAR agreement created by the application, all in behalf of the City of Grapevine. Section 4. That the TexSTAR Investment Policy is adopted as the City of Grapevine Investment Policy; the TexSTAR investment officers are designated as City of Grapevine investment officers; and, the TexSTAR Board of Directors is designated as custodian and depository in each case of the deposits of City of Grapevine public funds with TexSTAR. Section 5. That the City of Grapevine excess public funds shall be deposited with and invested through TexSTAR pursuant to the City's "Investment Policy", a current copy of which shall be provided to TexSTAR. Section 6. That this resolution shall be effective from and after the date of its passage and shall continue in full force and effect until amended or revoked by the City Council of the City of Grapevine, Texas, and written notice of the amendment or revocation is delivered to the TexSTAR Board of Directors. PASSED AND APPROVED BY THE CITY COUNCIL OF THE CITY OF GRAPEVINE, TEXAS on this the 21st day of October, 2003. F.11MMM RES. NO. 2 APPLICATION FOR PARTICIPATION IN TExSTAR The undersigned local government (Applicant) applies and agrees to become a Participant in the Texas Short Term Asset Reserve Program (TEXSTAR). 1. Authorization. The governing body of Applicant has duly authorized this application by adopting the following resolution at a meeting of such governing body duly called, noticed, and held in accordance with the Texas Open Meeting Law, chapter 551, Texas Government Code, on October 21 2003: ' WHEREAS, it is in the best interests of this governmental unit ("Applicant") to invest its funds jointly with other Texas local governments in the Texas Short Term Asset Reserve Program (TEXSTAR) in order better to preserve and safeguard the principal and liquidity of such funds and to earn an acceptable yield; and WHEREAS, Applicant is authorized to invest its public funds and funds under its control in TEXSTAR and to enter into the participation agreement authorized herein; NOW, THEREFORE, BE R RESOLVED THAT. SECTION 1. The form of application for participation in TEXSTAR attached to this resolution' is approved. The officers of Applicant specified in the application are authorized to execute and submit the application, to open accounts, to deposit and withdraw funds, to designate other authorized representatives, and to take all other action required or permitted by Applicant under the Agreement created by the application, all in the name and on behalf of Applicant. SECTION 2. The TEXSTAR Investment Policy is adopted as Applicant's investment policy, the TE(STAR investment officers are designated as Applicant's investment officers, and the TEXSTAR Board is designated as custodian and depository, in each case for Applicant's public funds and funds under its control that are deposited with TEXSTAR. Unless Applicant provides a contrary investment policy to TEXSTAR, it shall be Applicant's investment policy that any or all of its public funds and funds under its control may be invested.in and through TSCSTAR SECTION 3. This resolution will continue in full force and effect until amended or revoked by Applicant and written notice of the amendment or revocation is delivered to the TExSTAR Board. SECTION 4. Terms used in this resolution have the meanings given to them by the application." 2. Agreement. Applicant agrees with other TEXSTAR Participants and the TEXSTAR Board to the Terms and Conditions of Participation in TEXSTAR, effective on this date, which are incorporated herein by reference. Applicant makes the representations, designations, delegations, and representations described in the Terms and Conditions of Participation. 3. 4. 5. Authorized Representatives. Each of the following Participant officials is designated as Participants Authorized Representative authorized to give notices and instructions to the Board in accordance with the Agreement, the Bylaws, the Investment Policy, and the Operating Procedures: ame Signature Title Roger. Nelson Bruno Rumbelow .....I ............................. William A. Gaither ........... I ....................... Fred L. Werner ................................... City Manager Asst. City..Mana�er Dir. of Admin. Svc. ..I............................. Managing Dir. of Fin. Svc. ................................ ...................................... I ...... I..................... .... I........................... The following Participant official is designated as the Primary Contact and will receive all TexSTAR correspondence including transaction confirmations and monthly statements [required]: Name Signature Title Fred L. WernerManaging Dir. of Fin. Svc. .................................. The following Participant official is designated as a Participant Inquiry Only Representative authorized to obtain account information (optional]: Name Signature Title ... ........... I ................. .................................................................. Applicant may designate other authorized representatives by written instrument signed by an existing Applicant Authorized Representative or Applicant's chief executive officer. Taxpayer Identification Number. Applicant's taxpayer identification number is . 75 6000546„__,.. Bank Information Sheet(s). The attached (insert quantity] ............ Bank Information Sheet(s) is or are approved and incorporated herein by reference to establish account(s) in the name of Applicant. Datedthis .......................................... ............. ................. ......... I........................ (Name of Applicant) By: ................................................................. (Signature of official) ' ......................................................... (Printed name and title) Approved and accepted: TEXAS S HORT T ERM ASSET RESERVE FUND By: FIRST SOUTHWEST ASSET MANAGEMENT, INC., Participant Services Administrator By: .................................................. Authorized Signer TexSTAR is an investment service created by Local Governments For Local Governments Transferring funds for investment and achieving solid fiscal responsibility are critical challenges for local governments. TexSTAR offers Texas cities, counties, school districts and other municipalities an investment option that provides security, liquidity and efficiency. This simplicity and convenience, together with an understanding of the unique requirements of our clients, distinguishes TexSTAR as the premier investment service for Texas local governments. TexSTAR has been tailored to provide investment solutions to any local government investment plan, whether as a liquidity component, for a more comprehensive investment strategy or as a method to diversify an investment program primarily based on traditional banking services. Regardless of the need or objective, TexSTAR offers an unparalleled option of security in an investment scenario laden with risk. TexSTAR Administrators have a proven track record TexSTAR is administered by First Southwest Asset Management, Inc. and JPMorgan Chase. Together, these organizations bring to the TexSTAR program the powerful partnership of two leaders in financial services with a proven and noted track record in local government investment pool management. First Southwest Company is the leading financial advisor to Texas local governments and one of the top ranked advisory firms in the nation. For over 50 years, First Southwest has assisted clients in managing the continual change of the financial landscape by providing unique investment banking services in the areas of public, private and corporate banking. As a result of this experience, First Southwest has gained a thorough understanding of the needs of Texas local governments which fosters comfort and confidence in the oversight of their most precious financial assets. First Southwest Asset Management, Inc., the investment affiliate of First Southwest Company, has earned a position in the forefront of the financial service industry by providing specialized solutions for state and local governments in the areas of investment management and reporting, arbitrage rebate compliance and local government investment pool administration. JP Morgan Fleming Asset Management is a global financial institution and one of the largest and most respected asset managers in the world. With over a century of experience and a local presence in over 60 countries, they provide world-class investment solutions to public funds, corporations, endowments, foundations, third party intermediaries and individuals. As one the largest asset managers in the world, JP Morgan Fleming Asset Management is able to respond quickly to a clients' immediate cash requirements while earning interest at rates often higher than direct investments. 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