• Investments: AR-3200-A

  • Section 3000: Fiscal Management
    Administrative Regulation: AR-3200-A
    President’s Cabinet (PC) Approval: 4/20/93
    Revised: 8/11/98

    The investment officer is responsible for investing the financial assets of all excess funds of the District including the General Fund, Special Revenue Funds, Capital Project Funds, Enterprise Funds, Debt Service Funds, Internal Service Funds and any and all Trust and Agency Funds under control and direction of the College.

    The investment officer will routinely and actively monitor the contents of the investment portfolio, the available markets and the relative values of competing investments and will adjust the portfolio accordingly. The investment officer, acting in accordance with these procedures and exercising due diligence, will not be held personally responsible for a specific security’s credit risk or market price changes, provided that these deviations are reported as soon as practical and that appropriate action is taken to control adverse developments.

    All investments will be carried at cost. Gains or losses from investments will be credited or charged to investment income at the time of sale. Premiums or discounts on securities may be amortized over the life of the security.

    1. Diversification Of Maturity
      1. The District will attempt, to the maximum extent possible, to match investment maturity schedules with anticipated cash flow requirements. In no event, unless specifically matched to specific requirements such as bond sinking funds or reserves, will the District invest in securities having a maturity more than 18 months from the date of purchase. The District may, however, collateralize its repurchase agreements using longer-dated investments.
      2. Investment maturities for operating funds will be scheduled to coincide with projected cash flow needs and timed to comply with the following guidelines:
        1. Under - 30 days - 10% minimum
        2. Under - 90 days - 25% minimum
        3. Under - 270 days - 50% minimum
        4. Under - 1 Year - 85% minimum
        5. Under - 18 months - 100% minimum
      3. In determining the amount of excess funds available for investment purposes, the investment officer will maintain cash flow projections and schedules as well as a historical record of expenditures and receipts. These forecasts and schedules will be reviewed and updated as required to reflect actual conditions as they exist.
    2. Qualified Institutions For Investment Purchases
      1. The District will evaluate each financial institution (as used herein, the term is meant to include broker/dealer’s) from whom it purchases investments as to financial soundness at least once annually. Investigation may include review of the most recent Consolidated Report of Condition (“call” report), rating reports, financial statement as well as analysis of the particular institution’s management, profitability, capitalization and asset quality.
      2. Any financial institution with whom Mt. Hood Community College (MHCC) wishes to do business will provide financial data at the request of the investment officer. The information will be reviewed by the investment officer who will decide on the soundness of the institution before adding that institution to those that are on the approved Qualified Institution List for the District. The District reserves the right to be selective and to add or delete institutions from the approved list at will.
      3. The investment officer will maintain a Qualified Institution List. A financial institution must be on this approved list prior to transacting any business with the District. A basic requirement for inclusion on the approved listing is a capital adequacy ratio in excess of 120 percent (1.2 to 1). The listing of approved institutions will also delineate which type of security may be purchased from the particular listed institution.
      4. All approved financial institutions must be chartered in Oregon and insured by either the FDIC or FSLIC.
      5. Brokers or dealers not affiliated with a bank will have offices located in Oregon, be classified as reporting dealers affiliated with the New York Federal Reserve Bank as primary dealers, or required to meet capital adequacy requirements.
    3. Diversification Of Instrument Investment
      The investment officer will diversify the investment portfolio to avoid incurring unreasonable risks inherent in overinvesting in specific instruments, individual institutions or maturities.
    4. Time Certificates Of Deposit
      In purchasing a time certificate of deposit (TDC), the investment officer will not invest an amount which is more than 10 percent of the total deposits of any single institution. As required by Oregon Revised Statutes the investment officer will be responsible to ensure that a Certificate of Participation has been presented by the issuing institution to cover any outstanding TCD above the statutory level of insurance provided by FDIC/FSLIC. The District will always require full collateralization on all TCD investments.