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<br />e <br /> <br />. <br /> <br />Exhibit C <br /> <br />City of La Porte, Texas <br />Investment Strategy Statement <br /> <br />The City of La Porte, Texas (the "City") will strive to administer and invest its pooled <br />funds at the highest investment return possible while always taking into account the <br />primary goals of preservation of principal and liquidity of funds invested consistent with <br />the City's investment policy. <br /> <br />The City's funds, which are pooled together and constitute the investment portfolio, <br />include all financial assets of all funds managed by the City, including but not limited to <br />receipts of tax revenues, charges for services, bond proceeds, interest incomes, loans and <br />funds received by the City where the City performs a custodial function. <br /> <br />The City will never invest its funds in a security that is deemed unsuitable to the financial <br />requirements of the City. Maturities will be staggered in a manner that meets the cash <br />flow needs of the City. <br /> <br />The primary investment objective is the preservation and safety of principal. Each <br />investment transaction shall seek first to ensure that principal losses are avoided, whether <br />they are from security defaults or erosion of market value. <br /> <br />The City's investment portfolio will remain sufficiently liquid to enable the City to meet <br />operating requirements that might be reasonably anticipated. Liquidity shall be achieved <br />by matching investment maturities with forecasted cash flow requirements and by <br />investing in securities with active secondary markets. <br /> <br />The City shall always maintain a highly diversified investment portfolio in order to <br />reduce the amount of credit and market risk exposed to the City's portfolio. <br /> <br />After first considering safety and liquidity, the City's investment portfolio shall be <br />designed with the objective of regularly exceeding the average rate ofretum on the three <br />month U.S. Treasury Bill. The two-year Treasury Note may also be used to measure the <br />performance of the investment portfolio to the current market. The City shall seek to <br />augment returns above this threshold consistent with risk limitations identified in the <br />City's investment policy and prudent investment principles. <br />