705 Policy: Investments

I. Scope and Purpose

This policy applies to investments of the school district with regard to investing the financial assets of all funds except for Other Post-Employment Benefits (OPEB) Trust investments covered by policy 706.  Investments will be made based on statutory constraints and subject to available designated staffing capabilities.

II. General Statement of Policy

The funds of the school district shall be deposited or invested in accordance with this policy, Minnesota Statutes chapter 118A and any other applicable law or written administrative procedures.  The primary criteria for the investment of the funds of the school district, in priority order, are as follows:

A.    Custodial Credit Risk. Investments of the school district shall be undertaken in a manner that seeks to ensure the preservation of principal in the overall portfolio.  To attain this objective only appropriate investment instruments will be purchased and insurance or collateral may be required to ensure the return of principal.

B.    Liquidity. The school district’s investment portfolio shall be structured in such manner as to provide sufficient liquidity to pay obligations as they come due.

C.    Interest Rate Risk. The investment portfolio shall be designed to attain a market-average rate of return throughout budgetary and economic cycles, taking into account the risk constraints, the cash flow characteristics of the portfolio and legal restrictions for return on investments.

D.    Maintaining the Public’s Trust. All officials and employees that are a part of the investment process shall act professionally and responsibly as custodians of the public trust and shall refrain from personal business activity that could conflict with the investment program, or which could reasonably cause others to question the process and integrity of the investment program.  The investment officer shall avoid any transaction that could impair public confidence in the school district.

Legal References
Policy Adopted: 3/7/89 M.S. 118A