Page 124 - CityofBurlesonFY26Budget

 Internal Service Funds
 Any new fund created by the City, unless specifically exempted from this Policy by
the City Council, or by law.

When advantageous, the City will consolidate cash balances to optimize investment strategy
implementation. Investment income will be allocated to the consolidated funds based on
their respective participation in the consolidated balances and in accordance with generally
accepted accounting principles.

This Investment Policy shall apply to all transactions involving the financial assets and related
activity for all the foregoing funds. However, this Policy does not apply to the assets
administered for the benefit of the City by outside agencies under pension plans or deferred
compensation programs.

IV. INVESTMENT OBJECTIVES

The City shall manage and invest its cash with four primary objectives, listed in order of
priority: safety, liquidity, public trust, and yield (expressed as optimized interest earnings).
The safety of the principal always remains the primary objective. All investments shall be
designed and managed in a manner responsive to the public trust and consistent with state
and local law.

The City shall maintain a comprehensive cash management program, which includes
collection of account receivables, vendor payments in accordance with invoice terms, and
prudent investment of available cash.

Safety

Safety of principal is the foremost objective of the investment program. The objective will be
to mitigate credit and interest rate risk.

o Credit Risk and Concentration of Credit Risk - The City will minimize credit risk, the risk
of loss due to the failure of the issuer or backer of the investment, and concentration
risk, the risk of loss attributed to the magnitude of investment in a single issuer, by:

 Limiting investments to the safest types of issuers;
 Pre-qualifying the financial institutions and brokers/dealers with which the
City will do business; and
 Diversifying the investment portfolio so that potential losses on individual
issuers will be minimized, as appropriate.

o Interest Rate Risk - The City will manage the risk that the interest earnings and the
market value of investments in the portfolio will fall due to changes in general interest
rates. The City will:

 Structure the investment portfolio so that investments mature to meet cash

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