ORDINANCE NO. 119-17
AN ORDINANCE AMDENDING SUBSECTION 2-3(b) OF THE
CODE OF ORDINANCES OF THE CITY OF OPELIKA; CDARS
PROGRAM ADDED AS AN INVESTMENT TYPE
WHEREAS, in 2009, the Alabama Legislature amended state law to permit the investment of public funds through the Certificate of Deposit Account Registry Service (“CDARS”); and
WHEREAS, CDARS consists of a network of banks around the country; and
WHEREAS, through a local CDARS member bank, the City of Opelika, Alabama (the “City”) can purchase certificates of deposit from other banks around the country; and
WHEREAS, Federal Deposit Insurance Corporation (“FDIC”) insurance is limited to $250,000 in deposits per owner at a single insured bank; and
WHEREAS, through the CDARS Program, small and medium banks can offer their customers insurance on deposits greater than $250,000—the usual maximum to be insured—because the excess is placed with other banks; and
WHEREAS, large deposits over $250,000 are broken into smaller amounts and placed with other banks that are members of the CDARS network; and
WHEREAS, member banks can issued CDs in amounts under $250,000 so that the entire investment is eligible for FDIC insurance; and
WHEREAS, City staff has recommended that the City participate in the CDARS Program.
NOW, BE IT ORDAINED by the City Council (the “Council”) of the City of Opelika, Alabama (the “City”) as follows:
Section 1. Amendment. That Subsection 2-3(b) of the Code of Ordinances of the City of Opelika is hereby amended to read as follows:
(b) Investments. Any municipal funds not presently needed for other purposes may be invested in any of the following:
(1) U.S. dollar-denominated deposit account and certificates of deposit with banks or savings institutions organized under the laws of the United States or State of Alabama in amounts which are fully insured to the holder by the Federal Deposit Insurance Corporation or by the Federal Savings and Loan Insurance Corporation (insured deposits), and in amounts in excess of the insured deposits; provided, that all amounts in excess of the insured deposit shall be secured at all times by a perfected lien or security interest in pledged collateral in accordance with the provisions of paragraph (c) hereof. All municipal funds shall be deposited in financial institutions located within the State of Alabama.
(2) United States Treasury Notes.
(3) U.S. Treasury Bonds.
(4) Certificates of Account Registry Service (CDARS) placed with a local CDARS member. CDARS are fully insured as to principle and interest that may be accrued by the Federal Deposit Insurance Corporation (FDIC) or the National Credit Union Association (NCUA).
Section 2. Investment Authority. That the City Council hereby delegates to the City Clerk/Treasurer the discretionary authority to deposit, invest or re-invest surplus funds of the City. Without limiting his discretion in any way, the City Clerk/Treasurer is hereby expressly authorized to invest City funds in the CDARS Program.
Section 3. Signatory Authority. That the Mayor and the City Clerk are hereby authorized to sign, execute and initial all contracts and other documents on behalf of the City required for participation in the CDARS Program.
Section 4. Publication. The City Clerk of the City of Opelika, Alabama is hereby authorized and directed to cause this Ordinance to be published one (1) time in a newspaper of general circulation published in the City of Opelika, Lee County, Alabama.
Section 5. Effective Date. This ordinance and the section adopted shall become effective and enforced immediately upon its passage and publication as required by law.
ADOPTED AND APPROVED this the 1st day of August, 2017.
/s/ Eddie Smith
PRESIDENT OF THE CITY COUNCIL OF THE CITY OF OPELIKA, ALABAMA
ATTEST:
/s/ R. G. Shuman
CITY CLERK
TRANSMITTED TO MAYOR on this the 2nd day of August, 2017.
/s/ R. G. Shuman
CITY CLERK
ACTION BY MAYOR
APPROVED this the 2nd day of August, 2017.
/s/ Gary Fuller
MAYOR
ATTEST:
/s/ R. G. Shuman
CITY CLERK
Legal run 8/2/17
AN ORDINANCE AMDENDING SUBSECTION 2-3(b) OF THE CODE OF ORDINANCES OF THE CITY OF OPELIKA; CDARS
