HomeMy WebLinkAbout050-95RESOLUTION NO. 50-95
A RESOLUTION OF THE TOWN COUNCIL OF THE TOWN OF DANVILLE
EXPRESSLY AUTHORIZING THE RETENTION OF SPECIFIC INVESTMENTS
WITH TERMS REMAINING TO MATURITY IN EXCESS OF FIVE YEARS
AS REQUIRED BY SECTION 53601 OF THE CALIFORNIA
GOVERNMENT CODE AND THE TOWN OF DANVILLE INVESTMENT
POLICY AS ADOPTED ON SEPTEMBER 6, 1994
WHEREAS, Section 53601 of the California Government Code (Circumstances authorizing
investments; authorized investments) and the Town of Danville Investment Policy as adopted
on September 6, 1994 provide that no investment shall be made in any security, other than a
security underlying a repurchase or reverse repurchase agreement authorized by Section 53601,
which at the time of the investment has a term remaining to maturity in excess of five years,
unless the legislative body has granted express authority to make that investment either
specifically or as part of an investment program approved by the legislative body no less than
three months prior to the investment; and
WHEREAS, between May 27, 1993 and April 15, 1994, the Town of Danville purchased five
separate securities with terms remaining to maturity in excess of five years; and
WHEREAS, the Town of Danville Town Council did not grant express authority or
authorize in any manner the purchase of the five securities identified, prior to their purchase
by the Town; and
WHEREAS, the five securities are in compliance with Section 53601 of the Government
Code and the Town of Danville Investment Policy in all other respects; and
WHEREAS, the five securities are specifically identified as:
(1) Citicorp Corporate Bond (6/29/05 maturity)
(1) Salomon Brothers Corporate Bond (5/27/03 maturity)
(1) Ford Motor Company Corporate Bond (11/05/08 maturity)
(1) Philip Morris Company Corporate Bond (8/15/02 maturity)
(1) Federal Home Loan Mortgage Corporation CMO (11/15/23) maturity; and
WHEREAS, three of the securities constitute a portion of reserve funds which are held for
public financings and have maturity dates which are in advance of the specific debt retirement
dates, specifically:
Security
Bond Maturity
Debt Retirement Date
Salomon Brothers Corporate
Bond
5/27/03 11/01/07
Ford Motor Company
Corporate Bond
11/05/08 9/2/13
Philip Morris Company
Corporate Bond
8/15/02 9/02/15 ;and
WHEREAS, the Town of Danville is financially capable of retaining all of the five securities
with maturities in excess of five years to their designated maturity dates; and
WHEREAS, the liquidation of these securities prior to their respective maturity dates could
result in substantial and unnecessary loss of principal which loss would be detrimental to the
Town's investment portfolio; and
WHEREAS, the Town Council has determined that retention of these securities is in the best
public interest; and,
WHEREAS, the intent of the Town of Danville is to be in complete compliance with
Government Code Section 53601 and the Town of Danville Investment Policy; now, therefore
be it
RESOLVED, that the Town Council of the Town of Danville hereby expressly authorizes
the retention of the five securities designated herein by the Town of Danville as provided by
Section 53601 of the California Government Code and the Town of Danville Investment
Policy as adopted on September 6, 1994.
APPROVED by the Danville Town Council at a regular meeting held on March 21, 1995 by
the following vote:
AYES: Greenberg, Doyle,
NOES: None
ABSTAINED: None
ABSENT: None
Ritchey,
Shimansky, Waldo
C
MAYOR
APPROVED AS TO FORM:
CITY ATTORNEY
ATTEST:
" {5 !
CITY CLERK