6144 - INVESTMENT INCOME

Farwell Area Schools

Bylaws & Policies

6144 - INVESTMENT INCOME

The Board of Education authorizes the Superintendent or Business Manager to make investments of available monies from the several funds of the District in:

	A.	bonds, bills, or notes of the United States; obligations, the principal and interest of which are fully guaranteed by the United States; or obligations of the State;
	B.	certificates of deposit issued by financial institutions organized and authorized to operate in this State;
	C.	commercial paper rated prime 1 or prime 2 at the time of purchase and maturing not more than 270 days after the date of purchase;
	D.	securities issued or guaranteed by agencies or instrumentalities of the United States government;
	E.	United States government or Federal agency obligation repurchase agreements;
	F.	bankers' acceptances issued by a bank that is a member of the Federal deposit insurance corporation;
	G.	mutual funds composed entirely of investment vehicles that are legal for direct investment by a school district;
	H.	investment pools, as authorized by the surplus funds investment pool act, Act. No. 367 of the Public Acts of 1982, being M.C.L. 129.11 to M.C.L. 129.118, composed entirely of instruments that are legal for direct investment by a school district.

The purpose of the investments is to maximize the returns on the District's excess cash balances consistent with safety of those monies and with the desired liquidity of the investments.

Investments in U.S. Treasury securities and those other securities completely guaranteed by the Treasury as to payment of principal and interest may be purchased in any dollar amount or up to 100% of the available reserves.

Investments in other types of authorized securities may be made with the provision that no more than the total current investment portfolio consists of one type of security.

The Superintendent/Business Manager is authorized to contract with a depository for the operation of a cash management system under the condition that the contract provides for the investment of funds by the depository with the written approval of the Superintendent/Business Manager.

All investments must mature or be redeemable within one (1) year of the date of purchase.

An obligation purchased in accordance with M.C.L.A. 380.1223(2), when received by the Farwell Schools, shall be deposited with the bank or trust company having the deposit of the money of the particular fund from which the obligation was purchased.

Money in the several funds of the School District shall not be commingled for the purpose of making an investment authorized by M.C.L.A. 380.1223. The Board, however, may establish and maintain one common debt retirement fund for bond issues of like character.

Earnings on an investment shall become a part of the fund from which the investment was made.

Funds of the Board may be withdrawn from approved public depositories or negotiable instruments owned by the Board and sold before maturity at the sole discretion of the Superintendent/Business Manager acting within the law.

The Board of Education may request, no more often than four (4) times per year, that each public depository report the amount of monies deposited by him/her and the total value of the pool of securities pledged to secure the monies of this District held by the depository.

The Business Manager shall include in the monthly report to the Board all cash in all accounts on deposit as well as the investment assets of the Board.

The Board also requires the Business Manager to report to the Board monthly:

	A.	the types and amounts of each investment and the interest earned on each;
	B.	the transactions occurring since the last report.

The Board may adopt a resolution at its annual organizational meeting, authorizing electronic transactions and the treasurer or the Electronic Transfer Officer (ETO) as authorized agent(s) to complete such transactions on behalf of the Board. The Automatic Clearing House (ACH) authorizing resolution shall include all of the following:

	A.	That an officer or employee designated by the Treasurer or ETO is responsible for the local unit’s ACH agreements, including payment approval, accounting, reporting, and generally for overseeing compliance with the ACH policy.
	B.	That the officer or employee responsible for disbursement of funds shall submit to the local unit documentation detailing the goods or services purchased, the cost of the goods or services, the date of the payment, and the department levels serviced by payment. This report can be contained in the electronic general ledger software system of the local unit or in a separate report to the governing body of the local unit.
	C.	A system of internal accounting controls to monitor the use of ACH transactions made by the local unit.
	D.	The approval of ACH invoices before payment.
	E.	Any other matters the Treasurer or ETO considers necessary.

M.C.L.A. 124.301 et seq., 380.1223

Revised 3/3/97
Revised 10/19/98
Revised 4/04