Page 331 - CityofHasletFY25AnnualBudget

5. Certificates of Deposit of state and national banks domiciled in Texas,
guaranteed or insured by the Federal Deposit Insurance Corporation or its
successor or secured by obligations described in Sections A1 through A4 above,
which are intended to include all direct agency or instrumentality issued
mortgage backed securities rated AAA by a nationally recognized rating agency,
or by Article 2529b-1, V.T.C.S., and that have a market value of not less than the
principal amount of the certificates.

6. Fully collateralized direct repurchase agreements with a defined termination date
secured by obligations of the United States or its agencies and instrumentalities
pledged with a third party, selected by the Investment Office, other than an
agency for the pledged obligation. Repurchase agreements must be purchased
through a primary government securities dealer, as defined by the Federal
Reserve, or a bank domiciled in Texas.

7. Government Investment pools, such as TexPool, which meet the requirements of
Texas Government Code 2256.016, provided the City Council has approved the
specific pool.

8. Money market accounts at City designated depositories under executed
depository agreements.

B. Investments Not Authorized

The City’s authorized investment options are more restrictive than those allowed by the
Act. The Act specifically prohibits investment in the following investment securities:

Obligations whose payment represents the coupon payments on the outstanding
principal balance of the underlying mortgage backed security collateral and pays
no principal.

2. Obligations whose payment represents the principal stream of cash flow from the
underlying mortgage-backed security collateral and bears no interest.

3. Collateralized mortgage obligations that have a stated final maturity date of
greater than 10 years.

4. Collateralized mortgage obligations the interest rate of which is determined by an
index that adjusts opposite to the changes in a market index.

C. Holding Period

The City intends to match the holding periods of investment funds with liquidity needs of
the City. In no case will the average maturity of investments of the City’s operating

City of Haslet Financial Policy

Haslet Adopted Budget FY 2024-2025 329