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HomeMy WebLinkAbout2006 10-16 FCAAGENDA CITY COUNCIL AND FINANCIAL COMMISSION JOINT WORK SESSION October 16, 2006 6:30 P.M. 1. Review of 2007 Budget Dates: a. Capital Projects and Enterprise Budget Review - October 16th 2006 b. Final Draft Review- November 20th 2006 C. Truth in Taxation Hearing - December 4th and 11 th if necessary d. Budget Adoption - December 11 th 2006 2. Capital/Enterprise and Other Budget Forecasts a. 2007-2021 Capital Improvement Program b. 2007-2021 Enterprise and Capital Cash Flow Review i. Water Utility ii. Sanitary Sewer Utility iii. Storm Water Utility iv. Street Light Utility v. Street Reconstruction Fund vi. Capital Improvement Fund vii. Recycling Fund 2004- 2010 3. Budget Reviews - Utilities and Internal Service Funds a. Water Utility Fund b. Sewer Utility Fund C. Storm Utility Fund d. Street Utility Fund e. Central Garage Fund 4. Construction Funds a. Street Reconstruction Fund b. Infrastructure Fund C. Municipal State Aid Construction Fund d. Capital Improvement Fund Other Enterprise Funds a. Recycling Fund b. Centerbrook Golf Course Fund C. Liquor Operations Fund d. Earle Brown Heritage Center Fund e. Earle Brown Heritage Center-Capital Fund 0 CITY COUNCIL AGENDA PAGE 2 October 16, 2006 • 6. Development, Grant and Forfeiture Funds a. EDA Fund b. CDBG Fund C. Grants Fund d. Police Forfeiture Fund 7. Tax Increment Financing and Debt Service Funds a. TIF Districts # 1,2,3 and 4 b. General Obligation Improvement Bonds i. 1996A ii. 1997A iii. 1998A iv. 1999A v. 2000A vi. 2001A vii. 2003A C. GO Building Refunding Bonds i. 2004A ii. 2006A d. GO TIF Refinancing Bonds i. 2004B • e. GO TIF Bonds i. 2004D 8. Budgetary Issues Remaining for Next Meeting a. Technology Fund b. Use of un-appropriated Local Government Aid 9. Adjournment 0 • if AGENDA Brooklyn Center Financial Commission Tuesday, 19 September 2006 6:30 PM Palmer Lake Conference Room (Upper Level of City Hall) I. Call to Order II. Roll Call III. Approval of Agenda IV. Meeting Minutes 411 a. 5 June 2006 V. Review of Proposed Changes in Financial and Investment Policies VI. Other Business VII. Adjournment • • I Financial Commission Regular Meeting Minutes 5 June 2006 1. Call to Order The meeting was called to order by Mr. Nemec at 8:43 PM 2. Roll Call Members Present: Commissioners Nemec and Shogren-Smith and Council Member Lasman. Commissioner Maze was excused. Staff present were Acting City Manager Boganey and Director of Fiscal & Support Services Jordet. 3. Adoption of the Agenda Ms. Shogren-Smith proposed and Mr. Nemec seconded a motion to adopt the agenda as presented. With all voting in favor, the motion was adopted. 0 4. Minutes Ms. Shogren-Smith proposed and Mr. Nemec seconded a motion to adopt the minutes of the 26 January 2006 meeting as presented. With all voting in favor, the motion was adopted. 5. Selection of Chair for the Remainder of 2006 With the passing of Mr. Escher a new Chair for the Commission is required for the remainder of 2006. Ms. Shogren-Smith moved that Mr. Nemec become Chair for the remainder of the year. Mr. Nemec was required to second the motion as no other voting members of the Commission were present. With all voting in favor the motion was adopted, making Mr. Nemec Chair of the Commission. Mr. Nemec then named Ms. Shogren-Smith as Vice Chair of the Commission. 6. City Council Compensation Ms. Shogren-Smith and Mr. Jordet reviewed the recommendation of the Subcommittee on City Council Compensation which met on 6 April 2006. Members of the Subcommittee were Mr. Anderson, Mr. Paulson and Ms. Shogren-Smith. At that meeting, having reviewed the information presented on current compensation and comparison with the designated other cities, the Subcommittee suggested that • Brooklyn Center's City Council was still in the same relative position that it was at the last review. Therefore, the same compensation solution was endorsed; no 1 increase for 2007 and a 2% increase for 2008. On behalf of the full Commission, IIIMs. Shogren-Smith moved and Mr. Nemec seconded a motion recommending no increase in City Council wages for 2007 and a 2% increase in 2008. With all present voting in favor, the motion was approved. 7. Centerbrook Golf Course Mr. Jordet presented the information on restructuring the financing of the Centerbrook Golf course. The plan to operate the course, make needed repairs and small capital investments and repay an outstanding interfund loan of $ 800,000 to the Capital Improvements Fund was reviewed by the Park and Recreation Commission in May of 2006. They endorsed the plan unanimously. Ms. Shogren- Smith moved and Mr. Nemec seconded a motion recommending the Plan to the City Council for adoption. With all voting in favor, the motion was adopted. 8. 2007 Budget Overview and Calendar Mr. Jordet presented the materials on the 2007 budget overview. These were the same materials presented to and discussed with the City Council at a 22 May 2006 Work Session. Council Member Lasman informed the Commission that the Council had agreed to the priorities in the presentation and instructed the staff to prepare the preliminary 2007 budget on this basis. No action was taken by the Commission. • 9. Other Business No other business was brought before the Commission. 10. Adjournment With no other business to transact, the meeting was adjourned at 9:07 PM. • 2 SECTION II—GENERAL POLICIES City Council Code of Policies 2.21 Financial Management Policies • I. Purpose The City of Brooklyn Center has a responsibility to its citizens to carefully account for public funds,to manage municipal finances wisely,and to plan the adequate funding of services desired by the public,including the provision and maintenance of public facilities. The City also has the responsibility to its citizens to provide both short-term and long-term future financial stability. The City must ensure that it is capable of adequately funding and providing local government services needed by the community. Further,the financial policies set forth herein,provide the basic framework for the overall fiscal management of the City. Operating independently of changing circumstances and conditions,these policies assist the decision making process of the City Council and Administration. Most of the policies represent long-standing principles,traditions and practices which have guided the City in the past and have helped maintain financial stability over the past years. The financial policies will be reviewed periodically to ascertain if modifications are necessary. 2. Objectives In order to achieve this purpose,this plan has the following objectives for the City's fiscal performance: A. To protect the City Council's policy-making ability by ensuring that important policy decisions are not controlled by financial problems or emergencies and to prevent financial difficulties. • B. To provide sound principles to guide the important decisions of the City Council and of management which have significant fiscal impact and to enhance the City Council's policy-making ability by providing accurate information on program costs. C. To set forth operational principles which plinlmize controlthe cost of local (Formatted:Strikethrough government,to the extent consistent with services desired by the public and which ie lower financial risk. { Formatted:Stnkethrough D. To employ revenue policies which prevent mitigate undue or unbalanced reliance 1Formatted:Stnkethrough on certain revenues, especially property taxes; which distribute the costs of municipal services fairly; and which provide adequate funds to operate desired program and assist sound management of the city government by providing accurate and timely information on financial conditions. E. To provide essential public facilities and prevent deterioration of the City's public facilities and its capital plant. City of Brooklyn Center 08/14/06 Page 223 • 3 SECTION II—GENERAL POLICIES CityCouncil Code ofPolicies F. To protect and enhance the City's credit rating and prevent default on any • municipal debts. G. To ensure the legal use and protection of all City funds through a quality system of financial and internal controls. H. The City will maintain a Risk Management Program that will minimize the impact of legal liabilities,natural disasters or other emergencies. 3. Financial Management Policies A. Capital Improvement Budget Policies 1. The City will make all capital improvements in accordance with an adopted Capital Improvement Budget. 2. The City will develop a multi-year plan for capital improvements and update it at least biennially. 3. The City will nact an adopt the annual Capital Improvements Budget [Formatted:Strikethrough based on the multi-year capital improvement plan. Future capital expenditures necessitated by changes in population, changes in real estate development,or changes in economic base will be calculated and included in Capital Budget projections. 4. The City will coordinate development of the Capital Improvement Budget with the development of the operating budget. Future operating costs associated with new capital improvements will be projected and included in operating budget forecasts. • 5. The City will use intergovernmental assistance to finance only those capital improvements, which are consistent with the adopted capital {Deleted:, improvement plan and City priorities and for which operating and maintenance costs have been included in operating budget forecasts. 6. The City will project its equipment replacement and maintenance needs for the next several years and will update this projection each year. From this projection,a maintenance and replacement schedule will be developed and followed. 7. The City staff will identify the estimated costs and potential funding sources for each capital project proposal before it is submitted to the City Council for approval. 8. The City will determine the least costly financing method over the length of all new projects. City of Brooklyn Center 08/14/06 Page 224 • 4 SECTION II—GENERAL POLICIES City Council Code of Policies B. Revenue Policies • 1. The City will attempt to maintain a diversified and stable revenue system to shelter it from short-run fluctuations in any one revenue source and to minimize property taxes. 2. The City will estimate its annual revenue by an objective conservative analytical process. 3. The City will project revenues for the next three years and will update this projection annually. Each existing and potential revenue source will be reexamined annually. 4. The City will maintain sound appraisal procedures to keep property values correct. Property will be assessed at the legally mandated market value for each type of property. Reassessments will be made of all property at • least every four i��.zyears. {Formatted:Strikethrough 5. The City will follow an faggressivc assertive policy of collecting property (Formatted:Strikethrough tax revenues. The annual level of uncollected property taxes should generally not exceed two percent. 6. Each year the City will recalculate the full costs of activities supported by user fees to identify the impact of inflation and other cost increases. 7. The City staff will recommend revised user fees with review by the City Council on an annual basis, to adjust for the effects of cost factors and Deleted:e inflation on the City's cost of providing services. t Formatted:Strikethrough 8. The City will set fees and user charges for each Enterprise Fund, such as • Water and Sewer, at a level which fully supports the total direct and indirect costs of the activity. Indirect costs include the cost of annual depreciation of capital assets. 9. `Vhen er l.i er charges and fees e'e determined to be appropriate for City Formatted Strikethrough services those charges and fees will generally be established at a level Deleted:. which will recover the full cost of providing the service, including '{ Formatted:Strikethrough administrative costs. { Formatted:Strikethrough C. Debt Policies 1. The City will confine long-term borrowing to capital improvements or projects which cannot be financed from current revenues. 2. When the City finances capital projects by issuing bonds, it will pay back the bonds within a period not to exceed the expected useful life of the project. City of Brooklyn Center 08/14/06 Page 225 • 5 SECTION II—GENERAL POLICIES City Council Code of Policies 3. On all projects, at least 50% of the principal shall be retired within ten • years. 4. The City will make every attempt to keep the average maturity of General Obligation Bonds at or below 20 years. 5. Total debt service paymentsfor General Obligation debt will not exceed five percent of total annual locally generated operating revenue in the general,special revenue,and proprietary funds. 6. Total outstanding General Obligation debt will not exceed two percent of the market valuation of taxable property. 7. Where possible, the City will use special assessment, revenue or other self-supporting bonds instead of General Obligation Bonds. 8. The City will not incur debt to support current operations. 9. The City will maintain good communications with bond rating agencies regarding its financial condition. The City will follow a policy of full disclosure in every financial report, official statement and bond prospectus. 10. Direct net-debt (gross debt less debt fully supported by non-property tax revenues)per capita shall not exceed$600 per capita. 11. The City will require Minimum Assessment (Taxable Valuation) Agreements on all projects in which the City is providing development assistance through tax increment financing or committing its bonding • authority. This will ensure minimal cash flow (increment) to repay obligations, provide another level of review before commitment (by the City Assessor), and to the minimal value agreed upon, eliminate tax appeals during the agreement period. 12. For purposes of this section, tax increment revenues arc classified as a non- ro.ertv tax revenue source D. Reserve Policies 1. The City shall manage its cash flow needs by having a target unreserved and undesignated General Fund balance at the close of each fiscal year equal--to between of 50,aid to 52% of the next year's General Fund {Formatted strikethrough operating budget. {Formatted:Stnkethrough 2. Undesignated General Fund monies that are not required for cash flow purposes may be transferred into other funds as may be appropriate or needed during the fiscal year. It is specifically anticipated that transfers City of Brooklyn Center 08/14/06 Page 226 • 6 SECTION II—GENERAL POLICIES City Council Code of Policies will be made to the Street Reconstruction Fund, Capital Improvements Fund, and the Technology Fund when operating results generate a surplus of actual revenues over actual expenditures to serve as a recurring source of funding for those three funds. Deleted:-----Page Break- E. Investment Policies 1. The City will make cash flow analysis of all funds on a regular basis. Disbursement, collection and deposit of all funds will be scheduled to ensure maximum cash availability. 2. When permitted by law, the City will pool cash from several different funds for investment purposes. 3. The City will invest at least 98%of its idle cash on a continuous basis. 4. The City will analyze market conditions and investment securities to determine what yield can be obtained, and attempt to secure the best possible return on all cash investments. 5. The City's accounting system will provide regular information concerning cash position and investment performance. 6. The City will maintain a formal written investment policy which will contain legal and administrative guidelines necessary to ensure that the City's available funds will be invested to the maximum extent possible, at the highest rates obtainable at the time of the investment, consistent with minimizing credit and market risk and which provides proper safeguards for the keeping of the City's investments. • F. Accounting,Auditing and Financial Reporting Policies 1. The City will establish and maintain a high standard of accounting practices in conformance with generally accepted accounting principals. 2. The accounting system will maintain records on a basis consistent with accepted standards for local government accounting using ,a modified Formatted:Strikethrough accrual GASI3 34 as the basis of accounting for all governmental funds and an accrual basis of accounting for Enterprise and Internal Service Funds. Accounting policies will reflect the principle of charging current taxpayers and/or users for the full cost of providing current services. 3. Regular monthly and annual financial reports will present a summary of financial activity by major types of funds as determined by the prior year's Comprehensive Annual Financial Report. City of Brooklyn Center 08/14/06 Page 227 • 7 SECTION II—GENERAL POLICIES City Council Code of Policies 4. Where possible,the reporting system will provide monthly information on • the total cost of specified services by type of expenditure and,if necessary, by fund. 5. An independent public accounting firm will perform an annual audit and will publicly issue an opinion concerning the City's finances. .G. Risk Management Policies {Deleted Page Break 1. The City will maintain a Risk Management Program that will minimize the impact of legal liabilities, natural disasters or other emergencies through the following activities: a. Loss Prevention. Prevent negative occurrences. b. Loss Control. Reduce or mitigate expenses of a negative occurrence. c. Loss Financing. Provide a means to finance losses. d. Loss Information Management. Collect and analyze relevant data to make prudent loss prevention, loss control and loss financing decisions. 2. The City's Risk Management Program will: a. Analyze all the City's risks. b. Avoid risks whenever possible. c. Reduce risks whenever possible. d. Transfer risks to other entities when possible. e. Of those risks that must be retained, it shall be the City's policy to fund risks which the City can afford and transfer all other risks to insurers. • 3. The City will maintain an active Safety Committee comprised of City employees. 4. The City will periodically conduct educational safety and risk avoidance programs, through its Safety Committee and with the participation of its insurers,within its various departments. 5. The Safety Committee will report to the City Manager, at least annually, on the results and costs of the City's Risk Management Program for the preceding year. The City Manager shall report annually to the City Council. H. Operating Budget Policies 1. In accordance with Chapter 7, Section 7.06 of the City Charter, the total sum appropriated in the General Fund annual budget shall be equal to the City of Brooklyn Center 08/14/06 Page 228 • 8 SECTION II—GENERAL POLICIES City Council Code of Policies total estimated General Fund revenue and flhe any allocated General Fund [Formatted:Strikethrough • balance. 2. The City will pay for all current expenditures with current revenues. The City will avoid budgetary procedures that balance current expenditures at the expense of meeting future year's revenues, or rolling over short-term debt, or that rely on accumulated fund balances to meet current obligations. 3. The City will annually appropriate a contingency appropriation in the General Fund budget, not to exceed five percent of the total budget, to provide for unanticipated expenditure of a non-recurring nature. 4. The City Manager, when submitting the Proposed Budget to the City Council, shall submit a balanced General.__.._Fund budget in which appropriations shall not exceed the total of the estimated General Fund revenue and he and fund balance 2 v^ilable after applying the klequate Formatted:Strikethrough Genet � "^ Glance or �^ appropriated by the City Council. ... Formatted:Strikethrough 5. Prior to adopting the General Fund Annual Budget,the City Council shall review the 244equate-General-Rind-Balanee Reserve Policyjeria. ,.. {Formatted:Strikethrough_ • Formatted:Strikethrough 6. In the event that there is a shortfall of revenues in a current year budget, the City Manager may recommend the use of a portion of the General Fund balance not to exceed the amount available after deducting amounts reserved for items not readily convertible to cash or reserved for working capital pr already appropriated to the General Fund current budget as (Formatted:Strikethrough shown on he most recent Adequate General Fund Balance Policy Formula as established by the City Council. . 7. The budget will provide for adequate maintenance of the capital plant and equipment,and for their orderly replacement. 8. The budget will provide for adequate funding of all retirement systems. 9. The City will maintain a budgetary control system to assist in adhering to the budget. 10. The City administration will prepare regular monthly reports comparing actual revenues and expenditures to the budgeted amount. 11. Each year the City will update expenditure projections for its Enterprise Funds for at least the wee ensuing five years. Projections will Formatted:Strikethrough include estimated operating costs of future capital improvements included in the Capital Budget. City of Brooklyn Center 08/14/06 Page 229 • SECTION II—GENERAL POLICIES City Council Code of Policies 12. The Operating Budget will describe the major goals to be achieved, and • the services and programs to be delivered for the level of funding provided. 13. Where possible, the City will integrate performance measurement and productivity indicators with the budget. ,14. Enterprise funds shall be budgeted to have positive net income plus a {Deleted: Page Break sufficient margin to provide for replacement cost of property, plant, and equipment. 1. Ethics Policy The City will maintain,and periodically review,a formal written ethics policy for all City employees and elected officials. J. Role of Auditors The City's independent auditors shall be required, in the course of their audit,in the leer content of their Management I otter,to report any conditions that appear Formatted:strikethrough to be violations of our financial management policy. {Deleted:m Deleted:I Reference: City Council Resolution Nos. 2004-189; 99-21; 98-48; City Council Minutes 5/22/95;6/8/92;2/26/90; 12/22/80 • City of Brooklyn Center 08/14/06 Page 230 • 10 SECTION II—GENERAL POLICIES City Council Code of Policies 2.22 Investment Policy • 1. Scope This investment policy applies to all of the investment activities of the City, except for +h r n ferred Ce ensat ^genoy F nd and the proceeds of refunding bond -{Formatted:strike-Irmo issues where the investment of such proceeds is specifically governed by the bond escrow• agreement. 2. Objective A. Safety Safety itnel of principal is the foremost objective of the investment program. (Formatted Strikethrough Investments shall be in a manner that;eeks to ensures the preservation 1 Formatted:Strikethrough of capital in the overall portfolio. i {Formatted:Strikethrough interest rate risk. {Formatted:Strikethrough 1. Credit Risk Credit risk is the risk of loss due to failure of the security issuer or backer. Credit risk may be mitigated by: a. Limiting investments to the safest types of securities;and b. Pre-qualifying the financial institution, broker/dealer, intermediaries, and advisors with which an entity will do business; and c. Diversifying the investment portfolio so that potential losses on • individual securities will be minimized. 2. Interest Rate Risk Interest rate risk is the risk that the market value of securities in the portfolio will fall due to changes in general interest rate. Interest rate risk may be mitigated by: a. Structuring the investment portfolio so that securities mature to meet cash requirements for ongoing operations, thereby avoiding the need to sell securities on the open market prior to maturity; and b. By investing operating funds primarily in shorter-term securities. City of Brooklyn Center 08/14/06 Page 231 • 11 SECTION II—GENERAL POLICIES City Council Code of Policies B. Liquidity • The investment portfolio shall remain sufficiently liquid to meet all operating requirements that may be reasonably anticipated. This is accomplished by structuring the portfolio so that securities mature concurrent with cash needs to meet anticipated demands. Furthermore, since all possible cash demands cannot be anticipated, the portfolio should contain a large component of securities with active secondary or resale markets. C. Yield The investment portfolio shall be designed with the objective of attaining a market rate of return throughout budgetary and economic cycles, taking into account the investment risk constraints and liquidity needs. Return on investment is of least importance compared to the safety and liquidity objectives described above. The pore of investments is limited to relatively low risk securities in Deleted:core ofinvestmentsare ........................................._............_...................................................._. anticipation of earning a fair return relative to the risk being assumed. Securities shall be held to maturity with the following exceptions: 1. Liquidity needs of the portfolio require that the security be sold. 2. A security of declining credit could be sold early to minimize loss of principal. D. Stable Earnings Since investment earnings are included in the budgeted revenues of the City, it is important that these earnings be stable and predictable through at least the next budget cycle. This pei s-to emphasizes the need to purchase securities of various . [Formatted:Strikethrough maturities so that at least half of the portfolio will remain for two or more years 4111 with known interest rates. 3. Standards of Care A. Prudence The standard of prudence to be used by investment officials shall be the prudent person standard described in Minnesota Statutes Chapel. 118A. It,will be applied - Deleted:and shall in the context of managing the overall portfolio. Investment officials acting in Formatted:Strikethrough accordance with this policy and exercising due diligence shall be relieved of personal responsibility for an individual security's credit risk or market price changes, provided deviations from expectations are reported in a timely fashion and the purchase and sale of securities are carried out in accordance with the terms of the policy. Investments shall be made with judgment and care, under circumstances then prevailing, which persons of prudence, discretion and intelligence exercise in the City of Brooklyn Center 08/14/06 Page 232 • 12 SECTION II—GENERAL POLICIES City Council Code of Policies management of I-he-if—own the City's affairs, not for speculation, but for Formatted Strkethrough investment,considering the probable safety of their capital as well as the probable income to be derived. B. Ethics and Conflicts of Interest Officials involved in the investment process shall refrain from personal business activity that could conflict with the proper execution and management of the investment program,or that could impair their ability to make impartial decisions. Officials shall disclose any material interests in financial institutions with which they conduct business. They shall further disclose any personal financial/investment positions that could be related to the performance of the investment portfolio. Officials shall refrain from undertaking personal investment transactions with the same individual with whom business in conducted on behalf of the City. C. Delegation of Authority Authority to manage the investment program is derived from Minnesota State Statutes,Chapter 118A and Brooklyn Center City Charter Chapter 6, Section 6.04 and is granted to the City Manager, City Treasurer, and Assistant,City Treasurer . . 1 Formatted:Strikethrough Finance Director. Responsibility for the operation of the investment program may be delegated by the City Manager to the City Treasurer, who shall carry out the program consistent with this policy. No person may engage in any investment transaction except as provided under the terms of this policy. The City Treasurer shall be responsible to the City Manager for all transactions undertaken and shall establish a system of controls to regulate the execution of all investment transactions. • D. Training To ensure the competence of its investment officials, the City shall provide the opportunity for the officials to attend such investment training programs as are available and suitable. 4. Safekeeping and Custody A. Authorized Financial Dealers and Institutions A resolution shall be submitted to the City Council at least annually to designate depositories of City funds. This shall include institutions and dealers/brokers where accounts are maintained for banking services, purchase and sale of investment securities,and the custody of securities. The City Treasurer shall provide to each broker or institution a written statement of investment restrictions which shall include a provision that all future investments are to be made in accordance with Minnesota Statutes governing the City of Brooklyn Center 08/14/06 Page 233 • 13 SECTION II—GENERAL POLICIES City Council Code of Policies investment of public funds,prior to completing an initial transaction,and annually • I thereafter. An annual review of the depositories shall be conducted by the City Treasurer. ..Deleted: Page Break Requests for Proposals for banking services and custodian for investment securities shall be conducted on a periodic basis as defined in the Policy and Procedure on Requests for Proposals for Financial Professional Services. B. Internal Controls The City Treasurer is responsible for establishing and maintaining an internal control structure designed to ensure that the assets of the City are protected from loss, theft, or misuse. The internal control structure shall be designed to provide reasonable assurance that these objectives are met. The concept of reasonable assurance recognizes that the cost of a control should not exceed the benefits likely to be derived and the valuation of costs and benefits requires estimates and judgments by management. Internal controls shall include the following: 1. Control of Collusion. Collusion is a situation where two or more employees are working in conjunction to defraud their employer. 2. Custodial safekeeping. Securities purchased from any bank or dealer shall be placed with an independent third party for custodial safekeeping or held in an account with the Federal Reserve Bank of Minneapolis. 3. Avoidance of physical delivery securities. Book entry securities are much easier to transfer and account for since actual delivery of a document never takes place. Delivered securities must be properly safeguarded against loss or destruction. The potential for fraud and loss increases with physical delivered securities.• 4. Clear delegation of authority to subordinate staff members. Officials must have a clear understanding of their authority and responsibilities to avoid improper actions. Clear delegation of authority also preserves the internal control structure. 5. Written confirmation of telephone transactions for investments and wire transfers. Due to the potential for errors and improprieties arising from telephone transactions, all transactions should be supported by written communications and approved by the appropriate official. Written communications may be via fax on letterhead. Institutions and brokers/dealers shall be provided with a list of authorized signers. 6. Development of a wire transfer agreement with institutions and brokers/dealers. This agreement should outline the various controls, security provisions, and delineate responsibilities of each party making and receiving wire transfers. City of Brooklyn Center 08/14/06 Page 234 14 SECT ION II—GENERAL POLICIES City Council Code of Policies 7. Independent Audit. The City's independent auditors shall conduct a . thorough review of the City's investment portfolio and transactions as part of their engagement. C. Delivery Verses Payment All trades where applicable will be executed by delivery verses payment(DVP). This ensures that securities are deposited in the eligible financial institution prior to the release of funds. Securities will be held by a third party custodian. 5. Suitable and Authorized Investments A. Investment Types Consistent with Minnesota Statutes Chapter 118A,the following investments will be permitted by this policy: 1. Securities that are the direct obligations or are guaranteed or insured issues of the United States, its agencies, its instrumentalities, or organizations created by an act of Congress; including governmental bills, notes, bonds, and other securities. 2. Commercial paper issued by U.S. corporations or their Canadian subsidiaries that is rated in the highest quality by at least two nationally recognized rating agencies and matures in 270 days or less. 3. Time deposits that are fully insured by the Federal Deposit Insurance Corporation or bankers acceptances of U.S.banks. • 4. Repurchase agreements and reverse repurchase agreements may be entered into with financial institutions identified by Minnesota Statutes Chapter 118A. 5. Securities lending agreements may be entered into with financial institutions identified by Minnesota Statutes Chapter 118A. 6. Minnesota joint powers investment trusts may be entered into with trusts identified by Minnesota Statutes Chapter 118A. 7. Money market mutual funds regulated by the Securities and Exchange Commission and whose portfolios consist only of short term securities permitted by Minnesota Statutes Chapter 118A. 8. Bonds of the City of Brooklyn Center issued in prior years, may be redeemed at current market price, which may include a premium, prior to maturity using surplus funds of the debt service fund set up for that issue. City of Brooklyn Center 08/14/06 Page 235 • 15 SECTION II—GENERAL POLICIES City Council Code of Policies Such repurchased bonds shall be canceled and removed form the . obligation of the fund. B. Securities Not Purchased Deruivative securities, which obtain,their value by the calculation of some portion of the value of another security shall not be purchased. "_ortgage backed Formatted:stnkethrougn secrities, a en if insured by a Federal Ageney shall of _he rch..sed Securities,which represent the principal or interest payments stripped off from an original issue security, shall not be purchased. C. Collateralization To the extent that deposits in bank accounts, certificates of deposit, and repurchase agreements exceed the available federal deposit insurance, collateral shall be furnished by the financial institution in accordance with Minnesota Statutes Chapter 118A. D. Maximum Maturities When purchasing investments,the Treasurer will attempt to match the maturity to future cash flow requirements. The City will not invest in securities maturing more than tern five years from the date of purchase. No more than ten percent of -.-{Formatted:Strikethrough the City's portfolio at any time shall be invested in securities with maturities of more than five three years. {Formatted:Strikethrough 6. Reporting A. The City Treasurer shall prepare a monthly investment report to the City Manager • which shall include a succinct management summary; a list of significant transactions such as purchases, sales, and maturities of investments; a list of investments by type, a list of investments by maturity, a calculation of average yield on the portfolio, and a statement of interest earned. This report will be prepared in a manner which will allow the City Manager to ascertain whether investment activities during the month have conformed to the investment policy. B. A statement of the market value of the portfolio shall be issued at least annually. This will review the investment portfolio in terms of value and subsequent price volatility. Reference: City Council Resolution Nos.97-60;90-105 City of Brooklyn Center 08/14/06 Page 236 • 16 SECTION II—GENERAL POLICIES City Council Code of Policies SCHEDULE FOR PROFESSIONAL SERVICES POLICIES 2.80 Policy and Procedure on Requests for Proposals for Financial Professional Services • 1. Need for Policy The City needs a policy and procedure to provide for the orderly conduct of requesting proposals for professional services for handling financial affairs, to ensure that all services will be periodically reviewed, and that the proper balance will be maintained between cost and quality of services. 2. Policy services agreements in the area of Cityfinance will be Formatted:Strikethrough A. All professionalb �_.._ . � :.::.:::....::.:..,.., periodically be_subject to a jet out for request for proposals (RFPs) process ' {Formatted:Strikethrough according to an established schedule. {Formatted:Strikethrough B. Service levels will be monitored by the City Council and Staff and if unsatisfactory service is received,that contracty4ill may be re-advertised prior to {Formatted:Strikethrough the year set in the schedule. C. Quality of service will be the primary factor in awarding a contract for professional service,but cost will also be a determinant. 3. Procedure A. A schedule shall be established for the conduct of RFPs. The schedule should be adhered to unless there is a performance problem or other justification for an earlier RFP. Going to the market too frequently with RFPs expends staff time, [Deleted:Staff requires extensive orientation of new professionals, and discourages quality firms • WY" from submitting proposals at their most attractive price�sinee if they,ll expect to Formatted Strikethrough �e nly have the contract for only a short time. Formatted:Strikethrough Formatted:Strikethrough B. Specifications tailored to the professional service to be advertised will be prepared by gaff, reviewed by the Financial Commission, and approved by the [Deleted:s City Council. C. A review committee made up of the City Manager and Finance Director shall review proposals for Banking Services, Insurance Agent, Risk Management Consultant, and Custodian for Investment Securities. Proposals for Auditor and I Financial Advisor shall be initially screened by gaff, and then reviewed by a ..... Deleteds committee of City Council Members and Financial Commission Members appointed by the Mayor in consultation with the Chair of the Financial Commission, with the approval of the City Council, which committee shall also include the City Manager and Finance Director. City of Brooklyn Center 08/14/06 Page 262 • 17 SECTION II-GENERAL POLICIES City Council Code of Policies D. The specifications will emphasize the abilities, qualifications, and experience of • the applicant firms to provide high quality service to the City. Price will be considered after one or more applicants have been identified as providing the desired quality of service. When appropriate,the specification shall require prices to be submitted in a separate, sealed envelope to be opened after applicants have been ranked according to quality. E. The City Manager shall make a recommendation to the City Council of a provider to be appointed to a multi-year engagement. It shall be written in the engagement that the appointment may be terminated earlier. Deleted: Reference: City Council Resolution Nos.2000-120;99-20;City Council Minutes 5/28/96 '{Formatted:Double strikethrough Schedule for Requests for Proposals Formatted Table Financial Services Type of Service lFinancia1 Banking, Insurance Risk Custodian for Auditor Advisor for Services Agent Management Investment _ 1 Bond Sales Consultant Securities Usual Interval _ _ _ _ 6 between RFP's 6 years 6 years 6 years 6 years 6 years years Most Recent RFP 2004 2002 2003 2003 1998 2002* 2006 RFP 2007 - - RFP 2008 RFP . 2009 RFP 2010 RFP - ' {Formatted Table 2011 RFP _ 2012 _ RFP _ 2013 .. RFP 2014 RFP _ _ 2015 RFP 2016 _ _ - RFP _ 2017 RFP - *Awarded to Deloite Touche who subsequently withdrew after the FY 2001 audit. Balance of engagement awarded to HLB Tautqes Redpath for FY 2002-FY 2006. =Scheduled RFP in former calendar =Recommended New Schedule to arrange RFP's for one per RFP year City of Brooklyn Center 08/14/06 Page 263 • 18 Page 263: [1]Deleted djordet 8/24/2006 10:54:00 AM 411 geroiee iccs seerrriHes H(,.....«..I 7..4,.....,.1 W44 n 2044 R P nr2 8T • • 19 • • I This page has been left blank intentionally. • 20 Minnesota Statutes 2005, Chapter 118A. Page 1 of 10 Legislature Home( Links to the World Help Advanced Search Minnesota . _ Office of the Revisor of Statutes House9( Senate ( Joint Departments and Commissions I Bill Search and Status Statutes, Laws, and Rules Minnesota Statutes 2005, Chapter 118A. Copyright 2005 by the Office of Revisor of Statutes, State of Minnesota. ==118A.01 118A.01 Definitions. Subdivision 1. Application. The definitions in this section apply to sections 118A.01 to 118A.06. Subd. 2. Government entity. (a) "Government entity" means a county, city, town, school district, hospital district, public authority, public corporation, public commission, special district, any other political subdivision, except an entity whose investment authority is specified under chapter 11A or 356A. (b) For the purposes of sections 118A.02 and 118A.03 only, the term includes an American Indian tribal government entity located within a federally recognized American Indian reservation. • Subd. 3. Financial institution. "Financial institution" means a savings association, commercial bank, trust company, credit union, or industrial loan and thrift company. Subd. 4 . Public funds. "Public funds" means all general, special, permanent, trust, and other funds, regardless of source or purpose, held or administered by a government entity, unless otherwise restricted. HIST: 1996 c 399 art 1 s 2; 1999 c 151 s 39 ==118A.02 118A.02 Depositories; investing: sales, proceeds, immunity. Subdivision 1. Designation; delegation. (a) The governing body of each government entity shall designate, as a depository of its funds, one or more financial institutions. (b) The governing body may authorize the treasurer or chief financial officer to: (1) designate depositories of the funds; (2) make investments of funds under sections 118A. 01 to •8A. 06 or other applicable law; or (3) both designate depositories and make investments as 21 http://www.revisor.leg.state.mn.us, P&year=current&chapter=118a 9/7/2006 Minnesota Statutes 2005, Chapter 118A. Page 2 of 10 provided in this subdivision. Subd. 2. Sale; proceeds; immunity, if loss. (a) The easurer or chief financial officer of a government entity may any time sell obligations purchased pursuant to this section and the money received from such sale, and the interest and profits or loss on such investment shall be credited or charged, as the case may be, to the fund from which the investment was made. (b) Neither such official nor government entity, nor any other official responsible for the custody of such funds, shall be personally liable for any loss sustained from the deposit or investment of funds in accordance with the provisions of sections 118A.04 and 118A. 05. HIST: 1996 c 399 art 1 s 3 ==118A.03 118A.03 When and what collateral required. Subdivision 1. For deposits beyond insurance. To the extent that funds on deposit at the close of the financial institution's banking day exceed available federal deposit insurance, the government entity shall require the financial institution to furnish collateral security or a corporate surety bond executed by a company authorized to do business in the tate. For the purposes of this section, "banking day" has the aning given in Federal Reserve Board Regulation CC, Code of ederal Regulations, title 12, section 229.2 (f) , and incorporates a financial institution's cutoff hour established under section 336.4-108. Subd. 2. In lieu of surety bond. The following are the allowable forms of collateral in lieu of a corporate surety bond: (1) United States government Treasury bills, Treasury notes, Treasury bonds; (2) issues of United States government agencies and instrumentalities as quoted by a recognized industry quotation service available to the government entity; (3) general obligation securities of any state or local government with taxing powers which is rated "A" or better by a national bond rating service, or revenue obligation securities of any state or local government with taxing powers which is rated "AA" or better by a national bond rating service; (4) unrated general obligation securities of a local government with taxing powers may be pledged as collateral against funds deposited by that same local government entity; (5) irrevocable standby letters of credit issued by Federal me Loan Banks to a municipality accompanied by written vidence that the bank's public debt is rated "AA" or better by Moody's Investors Service, Inc. , or Standard &> Poor's 22 http://www.revisor.leg.state.mn. ' AP&year=current&chapter=118a 9/7/2006 Minnesota Statutes 2005, Chapter 118A. Page 3 of 10 Corporation; and (6) time deposits that are fully insured by any federal •encY. Subd. 3. Amount. The total amount of the collateral computed at its market value shall be at least ten percent more than the amount on deposit plus accrued interest at the close of the financial institution's banking day, except that where the collateral is irrevocable standby letters of credit issued by Federal Home Loan Banks, the amount of collateral shall be at least equal to the amount on deposit plus accrued interest at the close of the financial institution's banking day. The financial institution may furnish both a surety bond and collateral aggregating the required amount. Subd. 4 . Assignment. Any collateral pledged shall be accompanied by a written assignment to the government entity from the financial institution. The written assignment shall recite that, upon default, the financial institution shall release to the government entity on demand, free of exchange or any other charges, the collateral pledged. Interest earned on assigned collateral will be remitted to the financial institution so long as it is not in default. The government entity may sell the collateral to recover the amount due. Any surplus from the sale of the collateral shall be payable to the financial institution, its assigns, or both. Subd. 5. Withdrawal of excess collateral. A financial institution may withdraw excess collateral or overnmental bstitute other collateral after giving written notice to the o entity and receiving confirmation. The authority to return any delivered and assigned collateral rests with the government entity. Subd. 6. Default. For purposes of this section, default on the part of the financial institution includes, but is not limited to, failure to make interest payments when due, failure to promptly deliver upon demand all money on deposit, less any early withdrawal penalty that may be required in connection with the withdrawal of a time deposit, or closure of the depository. If a financial institution closes, all deposits shall be immediately due and payable. It shall not be a default under this subdivision to require prior notice of withdrawal if such notice is required as a condition of withdrawal by applicable federal law or regulation. Subd. 7. Safekeeping. All collateral shall be placed in safekeeping in a restricted account at a Federal Reserve bank, or in an account at a trust department of a commercial bank or other financial institution that is not owned or controlled by the financial institution furnishing the collateral. The selection shall be approved by the government entity. HIST: 1996 c 399 art 1 s 4; 2003 c 51 s 15, 16; 2004 c 151 s 462; 2004 c 174 s 2 NOTE: The amendments made to subdivisions 1 and 3 by Laws *2004, chapter 151, sections 1 and 2, are effective retroactively 23 http://www.revisor.leg.state. -)&year=current&chapter=118a 9/7/2006 Minnesota Statutes 2005, Chapter 1 18A. Page 4 of 10 *from the beginning of a government entity's fiscal year 2003 and *apply to each fiscal year thereafter. Laws 2004, chapter 151, diction 3. ==118A. 04 118A.04 Investments. Subdivision 1. What may be invested. Any public funds, not presently needed for other purposes or restricted for other purposes, may be invested in the manner and subject to the conditions provided for in this section. Subd. 2. United States securities. Public funds may be invested in governmental bonds, notes, bills, mortgages (excluding high-risk mortgage-backed securities) , and other securities, which are direct obligations or are guaranteed or insured issues of the United States, its agencies, its instrumentalities, or organizations created by an act of Congress. Subd. 3. State and local securities. Funds may be invested in the following: (1) any security which is a general obligation of any state or local government with taxing powers which is rated "A" or better by a national bond rating service; 0 (2) any security which is a revenue obligation of any state local government with taxing powers which is rated "AA" or better by a national bond rating service; and (3) a general obligation of the Minnesota housing finance agency which is a moral obligation of the state of Minnesota and is rated "A" or better by a national bond rating agency. Subd. 4 . Commercial papers. Funds may be invested in commercial paper issued by United States corporations or their Canadian subsidiaries that is rated in the highest quality category by at least two nationally recognized rating agencies and matures in 270 days or less. Subd. 5. Time deposits. Funds may be invested in time deposits that are fully insured by the Federal Deposit Insurance Corporation or bankers acceptances of United States banks. Subd. 6. High-risk mortgage-backed securities. For the purposes of this section and section 118A.05, "high-risk mortgage-backed securities" are: (a) interest-only or principal-only mortgage-backed securities; and (b) any mortgage derivative security that: • (1) has an expected average life greater than ten years; 24 http://www.revisor.leg.state.mn. 3AP&year=current&chapter=118a 9/7/2006 Minnesota Statutes 2005, Chapter 118A. Page 5 of 10 (2) has an expected average life that: (i) will extend by more than four years as the result of an •mediate and sustained parallel shift in the yield curve of pus 300 basis points; or (ii) will shorten by more than six years as the result of an immediate and sustained parallel shift in the yield curve of minus 300 basis points; or (3) will have an estimated change in price of more than 17 percent as the result of an immediate and sustained parallel shift in the yield curve of plus or minus 300 basis points. Subd. 7. Temporary general obligation bonds. Funds may be invested in general obligation temporary bonds of the same governmental entity issued under section 429.091, subdivision 7, 469. 178, subdivision 5, or 475. 61, subdivision 6. Subd. 8 . Debt service funds. Funds held in a debt service fund may be used to purchase any obligation, whether general or special, of an issue which is payable from the fund, at such price, which may include a premium, as shall be agreed to by the holder, or may be used to redeem any obligation of such an issue prior to maturity in accordance with its terms. The securities representing any such investment may be sold by the governmental entity at any time, but the money so received remains part of the fund until used for the purpose for which the fund was created. Any obligation held in a debt service fund from which it is payable may be canceled at any time unless 11,herwise provided in a resolution or other instrument securing ligations payable from the fund. Subd. 9. Broker; statement and receipt. (a) For the purpose of this section and section 118A.05, the term "broker" means a broker-dealer, broker, or agent of a government entity, who transfers, purchases, sells, or obtains securities for, or on behalf of, a government entity. (b) Prior to completing an initial transaction with a broker, a government entity shall provide annually to the broker a written statement of investment restrictions which shall include a provision that all future investments are to be made in accordance with Minnesota Statutes governing the investment of public funds. (c) A broker must acknowledge annually receipt of the statement of investment restrictions in writing and agree to handle the government entity's account in accordance with these restrictions. A government entity may not enter into a transaction with a broker until the broker has provided this written agreement to the government entity. (d) The state auditor shall prepare uniform notification forms which shall be used by the government entities and the brokers to meet the requirements of this subdivision. ioHIST: 1996 c 399 art 1 s 5 25 http://www.revisor.leg.state.rr .P&year=current&chapter=118a 9/7/2006 Minnesota Statutes 2005, Chapter 118A. Page 6 of 10 ==118A.05 118A.05 Contracts and agreements. IIISubdivision 1. May enter into. In addition to other authority granted in sections 118A.01 to 118A.06, government entities may enter into contracts and agreements as follows. Subd. 2. Repurchase agreements. Repurchase agreements consisting of collateral allowable in section 118A.04, and reverse repurchase agreements may be entered into with any of the following entities: (1) a financial institution qualified as a "depository" of public funds of the government entity; (2) any other financial institution which is a member of the Federal Reserve System and whose combined capital and surplus equals or exceeds $10,000, 000; (3) a primary reporting dealer in United States government securities to the Federal Reserve Bank of New York; or (4) a securities broker-dealer licensed pursuant to chapter 80A, or an affiliate of it, regulated by the Securities and Exchange Commission and maintaining a combined capital and surplus of $40, 000, 000 or more, exclusive of subordinated debt. Reverse agreements may only be entered into for a period of 90 days or less and only to meet short-term cash flow needs. In event may reverse repurchase agreements be entered into for ne purpose of generating cash for investments, except as stated in subdivision 3. Subd. 3. Securities lending agreements. Securities lending agreements, including custody agreements, may be entered into with a financial institution meeting the qualifications of subdivision 2, clause (1) or (2) , and having its principal executive office in Minnesota. Securities lending transactions may be entered into with entities meeting the qualifications of subdivision 2 and the collateral for such transactions shall be restricted to the securities described in this section and section 118A.04 . ....._......___...__............_. Subd. 4 . Minnesota joint powers investment trust. Government entities may enter into agreements or contracts for: (1) shares of a Minnesota joint powers investment trust whose investments are restricted to securities described in this section and section 118A.04; (2) units of a short-term investment fund established and administered pursuant to regulation 9 of the Office of the Comptroller of the Currency, in which investments are restricted to securities described in this section and section 118A.04; (3) shares of an investment company which is registered der the Federal Investment Company Act of 1940 and which holds tself out as a money market fund meeting the conditions of rule 2a-7 of the Securities and Exchange Commission and is rated in 26 http://www.revisor.leg.state.n year=current&chapter=118a 9/7/2006 Minnesota Statutes 2005, Chapter 118A. Page 7 of 10 one of the two highest rating categories for money market funds by at least one nationally recognized statistical rating Ili ganization; or (4) shares of an investment company which is registered under the Federal Investment Company Act of 1940, and whose shares are registered under the Federal Securities Act of 1933, as long as the investment company's fund receives the highest credit rating and is rated in one of the two highest risk rating categories by at least one nationally recognized statistical rating organization and is invested in financial instruments with a final maturity no longer than 13 months. Subd. 5. Guaranteed investment contracts. Agreements or contracts for guaranteed investment contracts may be entered into if they are issued or guaranteed by United States commercial banks, domestic branches of foreign banks, United States insurance companies, or their Canadian subsidiaries, or the domestic affiliates of any of the foregoing. The credit quality of the issuer's or guarantor's short- and long-term unsecured debt must be rated in one of the two highest categories by a nationally recognized rating agency. Should the issuer's or guarantor's credit quality be downgraded below "A", the government entity must have withdrawal rights. HIST: 1996 c 399 art 1 s 6; 1997 c 219 s 1; 2000 c 493 s 1; 2005 c 152 art 1 s 2 411118A. 06 118A.06 Safekeeping; acknowledgements. Investments, contracts, and agreements may be held in safekeeping with: (1) any Federal Reserve bank; (2) any bank authorized under the laws of the United States or any state to exercise corporate trust powers, including, but not limited to, the bank from which the investment is purchased; (3) a primary reporting dealer in United States government securities to the Federal Reserve Bank of New York; or (4) a securities broker-dealer having its principal executive office in Minnesota, licensed under chapter 80A, or an affiliate of it, and regulated by the Securities and Exchange Commission; provided that the government entity's ownership of all securities is evidenced by written acknowledgments identifying the securities by the names of the issuers, maturity dates, interest rates, CUSIP number, or other distinguishing marks. HIST: 1996 c 399 art 1 s 7 'Ll8A.07 118A.07 Additional investment authority. 27 http://www.revisor.leg.state.mn.us, current&chapter=118a 9/7/2006 Minnesota Statutes 2005, Chapter 118A. Page 8 of 10 Subdivision 1. Authority provided. As used in this ection, "governmental entity" means a city with a population in cess of 200, 000 or a county that contains a city of that ize. If a governmental entity meets the requirements of subdivisions 2 and 3, it may exercise additional investment authority under subdivisions 4, 5, and 6. Subd. 2. Written policies and procedures. Prior to exercising any additional authority under subdivisions 4, 5, and 6, the governmental entity must have written investment policies and procedures governing the following: (1) the use of or limitation on mutual bond funds or other securities authorized or permitted investments under law; (2) specifications for and limitations on the use of derivatives; (3) the final maturity of any individual security; (4) the maximum average weighted life of the portfolio; (5) the use of and limitations on reverse repurchase agreements; (6) credit standards for financial institutions with which the government entity deals; and (7) credit standards for investments made by the government arty. Subd. 3. Oversight process. Prior to exercising any authority under subdivisions 4, 5, and 6, the governmental entity must establish an oversight process that provides for review of the government entity's investment strategy and the composition of the financial portfolio. This process shall include one or more of the following: (1) audit reviews; (2) internal or external investment committee reviews; and (3) internal management control. Additionally, the governing body of the governmental entity must, by resolution, authorize its treasurer to utilize the additional authorities under this section within their prescribed limits, and in conformance with the written limitations, policies, and procedures of the governmental entity. If the governing body of a governmental entity exercises the authority provided in this section, the treasurer of the governmental entity must annually report to the governing body on the findings of the oversight process required under this subdivision. If the governing body intends to continue to xercise the authority provided in this section for the llowing calendar year, it must adopt a resolution affirming at intention by December 1. 28 http://www.revisor.leg.state.: 'ear=current&chapter=118a 9/7/2006 Minnesota Statutes 2005, Chapter 118A. Page 9 of 10 Subd. 4 . Repurchase agreements. A government entity may enter into repurchase agreements as authorized under section 0. 18A.05, provided that the exclusion of mortgage-backed ._.._................. curities defined as "high-risk mortgage-backed securities" der section 118A.04, subdivision 6, shall not apply to repurchase agreements under this authority if the margin requirement is 101 percent or more. Subd. 5. Reverse repurchase agreements. Notwithstanding the limitations contained in section 118A.05, subdivision 2, the county may enter into reverse repurchase agreements to: (1) meet cash flow needs; or (2) generate cash for investments, provided that the total securities owned shall be limited to an amount not to exceed 130 percent of the annual daily average of general investable monies for the fiscal year as disclosed in the most recently available audited financial report. Excluded from this limit are: (i) securities with maturities of one year or less; and (ii) securities that have been reversed to maturity. There shall be no limit on the term of a reverse repurchase agreement. Reverse repurchase agreements shall not be included in computing the net debt of the governmental entity, and may be made without an election or public sale, and the interest ayable thereon shall not be subject to the limitation in ction 475. 55. The interest shall not be deducted or excluded om gross income of the recipient for the purpose of state income, corporate franchise, or bank excise taxes, or if so provided by federal law, for the purpose of federal income tax. Subd. 6. Options and futures. A government entity may enter into futures contracts, options on futures contracts, and option agreements to buy or sell securities authorized under law as legal investments for counties, but only with respect to securities owned by the governmental entity, including securities that are the subject of reverse repurchase agreements under this section that expire at or before the due date of the option agreement. HIST: 1996 c 399 art 1 s 8 ==118A.08 118A.08 No superseding effect. Except as provided in Laws 1996, chapter 399, article 1, section 11, sections 118A.01 to 118A.06 shall not supersede any ....___. _.__... general or special law relating to the deposit and investment of public funds. HIST: 1996 c 399 art 1 s 9 • 29 http://www.revisor.leg.state. ;urrent&chapter=118a 9/7/2006 Minnesota Statutes 2005, Chapter 118A. Page 10 of 10 • Please direct all comments concerning issues or legislation to your House Member or State Senator. For Legislative Staff or for directions to the Capitol, visit the Contact Us page. General questions or comments. • 30 http://www.revisor.Ieg.state.mr irrent&chapter=118a 9/7/2006 BROOKLYN CENTER FINANCIAL COMMISSION Chairperson and six members (revised September 2006) • Mark Nemec (Chairperson) Gene Maze 5538 Camden Avenue North 3000 Thurber Road Brooklyn Center, MN 55430 Brooklyn Center, MN 55429 Mark.Nemec@State.MN.US sandgmaz@peoplepc.com (763) 566-1415 (h); (651) 556-6788 (w) (763) 503-7194 (h); (612) 669-3555 (w) Appointed: 6/14/1999 Appointed: 5/22/2006 Term expires: 12/31/2006 Term expires: 12/31/2008 Susan Shogren Smith 4 vacancies 600 62nd Avenue North Brooklyn Center, MN 55430 sssmith2©stthomas.edu (612) 812-8160 Appointed: 1/26/2004 Term expires: 12/31/2006 2006 City Council Liaison: Kay Lasman (h) (763) 560-6689 0 council memberlasman©ci.brooklyn-center.mn.us Interim City Manager: Curt Boganey (w) (763) 569-3303 cboganey@ci.brooklyn-center.mn.us Director of Fiscal & Support Services: Daniel Jordet (w) (763) 569-3345 djordet©ci.brooklyn-center.mn.us • [September 11, 2006]