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• • <br />SCOPE <br />This investment policy applies to the investment activities of the government of <br />the City of La Porte, Texas. <br />FUNDS INCLUDED All financial assets of all funds managed by the City, <br />including but not limited to receipts of Tax Revenues, Charges for Services, <br />Bond Proceeds, Interest Incomes, Loans and Funds received by the City <br />where the City performs a custodial function. <br />II. OBJECTIVES <br />SAFETY The primary objective of the City's investment activity is the <br />preservation of capital in the overall portfolio. Each investment transaction <br />shall seek first to ensure that capital losses are avoided, whether they be from <br />securities defaults or erosion of market value. <br />LIQUIDITY The City's investment portfolio will remain sufficiently liquid to <br />enable the City to meet operating requirements that might be reasonably <br />anticipated. Liquidity shall be achieved by matching investment maturities with <br />forecasted cash flow requirements and by investing in securities with active <br />secondary markets. <br />YIELD The City's cash management portfolio shall be designed with the <br />objective of regularly exceeding the average rate of return on the three month <br />U.S. Treasury Bill. The investment program shall seek to augment returns <br />above this threshold consistent with risk limitations identified herein and <br />prudent investment principles. <br />RISK OF LOSS All participants in the investment process shall seek to act <br />responsibly as custodians of the public trust. Investment officials shall avoid <br />any transaction that might impair public confidence in the City's ability to <br />govern effectively. The governing body recognizes that in a diversified <br />portfolio, occasional measured losses due to market volatility are inevitable, <br />and must be considered within the context of the overall portfolio's investment <br />return, provided that adequate diversification has been implemented. <br />III. OVERSIGHT RESPONSIBILITY <br />Oversight Responsibility for the investment activity of the City of La Porte shall <br />rest with the Audit Committee and the City Manager. <br />