Ordinance No. 6,252920526 -1
ORDINANCE NO. 6252
AN ORDINANCE AUTHORIZING AND DIRECTING THE CITY MANAGER
TO EXECUTE AND THE CITY CLERK TO ATTEST TO A
PARTICIPATION AGREEMENT WITH THE TEXAS STATE TREASURER;
AND PROVIDING FOR THE EFFECTIVE DATE THEREOF.
BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF BAYTOWN,
TEXAS:
Section 1: That the City Council of the City of Baytown,
Texas, hereby authorizes and directs the City Manager and City
Clerk of the City of Baytown to execute and attest to a
Participation Agreement with the Texas State Treasurer. A copy
of said agreement is attached hereto, narked Exhibit "A," and
made a part hereof for all intents and purposes.
Section 2: This ordinance shall take effect immediately
from and after its passage by the City Council of the City of
Baytown.
INTRODUCED, READ and PASSED by the affirmative vote of the
City Council of the City of Baytown, this the 26th day of May,
1992.
BB V. CREDILLE, Mayor
ATTEST:
16 � ip, /74"
EILEEN P. EXLL, City Clerk
C �' �-) / 6. n , C"/,
ACIO RAMIREZ, S ., -City Attorney
C:1:10:11
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TEXAS STATE TREASURY
Texas Local Government Investment Pool
This participation agreement dad
(the "Participation Agreement ") is made and e
"Treasurer") and CITY OF BAYTOWN
WHEREAS, the Interlocal Coop
It. sM as amended and TEX. REV. CIV. STA
creation of publicfunds investment pools towb
authority to hold legal title as custodian and to
and
WHEREAS, the Treasurer has c
"Trust Company) which receives, transfers
agencies and local political subdivisions of the
director and which is managed by Treasury en
WHEREAS, the Treasurer has
(" TexPool ") as a public funds investment pool
investments as more fully described hereafter,
NOW THEREFORE for and it
agreements herein contained and other good w
are hereby acknowledged, the parties hereto a
Agreement
as of the _ day of .19---"
;red into by and between theTexas State Treasurer (the
ie "Participant').
ition Act, TEX. REV. CIV. STAT. ANN. art. 4413 (32)
ANN. art. 4413 (34 (c)) (the "Acts ") provide for the
t anypolitical subdivision maydelegate, by contract, the
ike investments purchased with local investment funds;
cated Texas Treasury Safekeeping Trust Company (the
ind disburses money and securities belonging to state
state and for which the Treasurer is the sole officer and
ployees; and
,rested the Teams Local Government Investment Pool
which TexPool funds shall be invested in certain eligible
consideration of the mutual promises, covenants and
uable consideration, the receipt and sufficiency of which
roe with each other as follows:
ARTICLE I.
DEFINITIONS
"ACH" shall mean Automated Clearing House electronic fund transfers.
"Authorized Investments" shall mean, in accordance with the Act, the purchase, sale and investment of
funds under TexPool's control in the following:
1. Obligations of the United States or its agencies and instrumentalities;
2. Direct obligations of the State of Texas or its agencies;
3. Other obligations, the principal of and interest on which are unconditionally guaranteed or insured by the
State of Texas or the United States;
• 4. Obligations of states, agencies, counties, cities, and other political subdivisions of any state having been
rated as to investment quality by a nationally recognized investment rating firm and having received a
rating of not less than A or its equivalent;
EXHIBIT A
S. Certificates of Deposit issued by state and national banks domiciled in this state that are:
0 A. Guaranteed or insured by the Federal Deposit Insurance Corporation, or its successor, or
B. Secured by obligations that are described by subdivisions 14 of this subsection, which are
intended to include all direct agency or instrumentality issued mortgage backed securities
rated AAA by a nationally recognized rating agency, or by Chapter 726, Ada of the 67th
Legislature, Regular Session, 1981 ( art. 2529b -1 TEX. REV. CIV. STAT. ANN.), and that
have a market value of not less than the principal amount of the certificates;
6. Fully collateralized direct repurchase agreements having a defined termination date, secured by obliga-
tions described by Subdivision i of thissubsection, pledged with a third parry selected or approved by the
political entity, and placed through a primary government securities dealer, as deQnod by the Federal
Reserve, or a bank domiciled in this state; and
7. Certificates of Deposit issued by savings and loan associations domiciled in this state that are:
A. Guaranteed or insured bytheFederal Savings and Loan Insurance Corporation oritssuccessors;
or
B. Secured by obligations that are described by Subdivisions 14 of this subsection, which are
intended to include all direct federal agencies or instrumentality issued mortgage backed
securities that have a market value of not less than the principal amount of the certificates.
S. Such other investments as may be authorized by TEX REV. CIV. STAT. ANN. art. 842a -2 as amended
from time to time.
"Authorized Representatives) of the Participant" shall mean those individuals who are authorized to execute documents
and take such other necessaryactions under this Participation Agreement as evidenced on behalf of the Participant by duly
enacted resolution of the Participant, a certified copy of which is on file with the Trust Company.
"Authorized Representative(s) of the Trust Compam" shall mean those employees of the Treasury authorized to execute
documents and take such other necessary actions including the investment of funds under this Participation Agreement
on behalf of the Trust Company as evidenced by resolution of the Trust Company, a certified copy ofwhich is on file with
the Participant.
"Data Collection Center" shall mean a third party vendor used by the Trust Company to collect and disburse fund
remittance information reported by the Participants.
'Utter of Instructions" shall mean a written authorization and direction to the Trust Company signed by an Authorized
Representative of the Participant.
easu 'shall mean the Texas State Treasury Department.
"W' eTransfers" shallmeandirectlywiredtransfersofTexPoolfundsorofParticipanesfundsthroughtheFede ralReserve
Bank System.
ARTICLE H.
PARTICIPATION REQUIREMENTS
Section 2.01; The Participation Agreement. The Participant must execute a Participation Agreement before depositing
any funds into TexPool. Further, a duly certified copy of a resolution by the Participant designating Authorized Representatives
• of the Participant must accompany the executed Participation Agreement.
Sion 202. Creation of TexPool. The Treasurer, as Trustee, hereby creates and establishes TexPool as a separate and
distinct trust fund to beheld outside the Treasury and to be managed in aeeordancewith this Participation Agreement for the bene fit
of the Participants. Further, the Treasurer hereby designates and appoints the Trust Company to operate and manage TexPool and,
to the extent permitted bylaw, appoints the Trust Company to act as custodian of all monies deposited by the Participant in TexPool
• and to receive, hold, invest and manage all monies deposited by the Participant into TexPool. By executing this Participation
Agreement, the Participant hereby consents to the foregoing. The Treasurer acting through the Trust Company hereby agrees to
manage the Participant's monies with the same degree of care and assuming the same duty to each Participant that is applicable to
the management of funds held inside the Treasury.
Section 2.03. Accounts. SubAcounts and Ow- netshig Interest. The Trust Company shall establish and maintain separate
account(s) for each Participant in TexPool in accordance with a duly executed Letter of instructions (the "Accounts "). Separate
SubAeeounts may also be established within each Account, as so directed from time to time in a Letter of Instructions (the "Sub -
Accounts').
Each Participant shall own an undivided beneficial interest in the assets of TexPool which shall consist of the proportional
amount each Participant's Accounts bear to the total amount of all Participants' Accounts in TexPool, computed on a daily basis.
AnAuthorizedRepresentativeofthe Participant mayalsoeliminate inactiveAccountsand SubAccounts from time to time
if the request is confirmed by a duly executed Letter of Instructions.
ARTICLE M.
FUND TRANSFERS IN TEXPOOL
Section 3.01. Method of Transfer of Funds. All fund transfers, both deposits and withdrawals, shall be by ACH or by Wire
Transfers. Presentation of physical items for deposit and/or withdrawal will not be accepted The Participant agrees to effect ACH
deposits and withdrawals by contacting TexPool's Data Collection Center using a touch -tone telephone, a eomputerwith a modem
or by rotary telephone talking to a live operator.
Section 2.02. AO and Transfers. In order to remit funds to TexPool, the Participant may initiate an ACH withdrawal
from its designated financial institution account by reporting remittance information via a toll-free telephone call to the Data
Collection Center. The Data Collection Center will immediately notify the Trust Company and the Trust Companywill credit the
Participant's account with available funds in the amount of the remittance on the next business day. All deposit and withdrawal
instructions for ACH fund transfers must be received by the Data Collection Center before 12:30 p.m. (Austin time) one day prior
to funds transfer on settlement day. in addition the Participant may also initiate ACH credits to TexPool which must be reported
to the Data Collection Center before 12:30 p.m. (Austin time) one day prior to funds transfer on settlement day.
The Texas State Treasury's Rapid Deposit Program Division shall be responsible for establishing and maintaining the ACH
system and Data Collection Center on behalf of all Participants.
ion 3.03. Wire Transfers. Notification of all Wire Transfers, including both deposits and withdrawals, must be made
by 10:00 a.m. on the same business day, provided the Participant immediately notifies the Authorized Representative of the Trust
Company by telephone call or by facsimile machine ("fax"). For all Wire Transfer withdrawal requests the Trust Company's
Authorized Representative will perform a call-back verification and authorization prior to effectuating any withdrawal.
Section 3.04, Deposits. Upon receipt by the Trust Company's Authorized Representative of notification by the Data
Collection Center orrectiptof any WireTransfer, the Trust Companywill credit Participant's Accountswith available funds. Same
day deposits puisuant to Section 3.03 hereof may only be effectuated by Wire Transfer. All deposits will be accepted regardless of
the day and time it is received by the Trust Company.
Section 3.05.1 ate Deposits. Because of the fluctuation in investment markets and its effect on investment decisions, late
deposits may not be includable in that day's TexPool assets. As used in the section, the term "late deposits" shall mean: (a) Wire
Transfers other than those described in Section 3.03 and (b) All other deposits received after 12:30 p.m. (Austin time). The
Participant agrees that late deposits may be segregated into an independent and separate investment overnight only. The
Participant hereby acknowledges that frequently late day investments are made at a lower interest rate yield, which would diminish
the remainder of the TexPool Participants' investment return income. The Participant agrees that the Trust Company shall use
its best efforts to purchase the highest interest rate yielding investment, however a decision to segregate a late deposit for purchase
of a separate lower yielding investment instrument will be made at the discretion of the Trust Company's Authorized Represen-
tative. In the event the Trust Company determines to invest a late deposit in a segregated lower yielding investment instrument,
only theaffected Participant's Accounts will receive the appropriate income earnings associated with the late deposited investment
on the neat business day. The funds will be merged into TexPool on the next business day. For all deposits received after 12:30 p.m.,
noon (Austin time), and in the event there is no suitable late day investment for a late deposit, the funds will be held in the
Participant's Accounts as a cash (non - interest bearing) deposit in the Trust Company's Federal Reserve Bank of Dallas account in
order to maintain complete security of the funds. The funds will be merged into TexPool on the next business day.
• Section 3.06. Withdrawals. To withdraw funds by Wire Transfer from TexPool, an Authorized Representative of the
Participant shall issue instructions not later than 1000 a.m. (Austin time) on the day the funds are to be withdrawn, specifying the
Account or SubAeeount and the amount of money to be wired or transferred in immediately available funds to the Participant's
designated local bank account. Such instructions may be oral, provided however that a written Letter of Instruction signed by an
Authorized Representative of the Participant is sent to the Trust Company within 24 hours of the oral instructions. All oral
instructions shall be subject to a call-back verification as described in Section 3.03. Upon receipt of a withdrawal request theTrust
Company will verify that the Participant's Account balance is sufficient to honor the request, and if so, the Trust Company will
transfer the requested funds to the Participant's designated local bank account in next day available funds by ACH, unless otherwise
so instructed by the Participant. Instructions from the Participant to withdraw the total balance in the Accounts or SubAccounts
may include any interest earnings credited to the Accounts or SubAccounts through the day of the withdrawal. In all other
circumstances accrued interest shall be credited daily and paid at the end of the month.
Section 3.07. Late Withdrawals. Same daywithdrawal requests must be received by 10 :00 a.m. and may only be effectuated
by Wire Transfer. A late withdrawal request may be subjected to and conditioned upon the ability of the Trust Company to fund
the withdrawal request. However, the Trust Company agrees to use its best efforts to honor such late withdrawal requests and to
notify the Participant immediately with information concerning disposition of the late withdrawal request.
Section 3.08. Seoradon of Accounts. TacPool was created to establish a fund that may be commingled for purposes of
common investment and operational efficiency However, each Participant shall have separate Accounts and SubAccounts on the
books and records of TexPool which shall be maintained by the Trust Company.
ARTICLE TV
INVESTMENTS AND DUTIES
Section 4.01. Investments. All monies held in TexPool shall be invested and reinvested by the Authorized Representa-
tivesof the Trust Companyonly in Authorized Investments. TexPool's available funds that are uninvested shall be held at the Trust
Company's account at the Federal Reserve Bank of Dallas. All Investments of both assets and collateral will be in the possession
he Trust Company and held in its book -entry safekeeping account at tha Federal Reserve Bank of Dallas.
Section 4.02. Failed Investment Trannoons. In the extraordinary event that a purchase of securities results in a failed
settlement, any resulting uninvested funds shall remain in the Trust Company's Federal Reserve Bank of Dallas account. If an
alternative investment can be secured after the failure of the trade to settle, TexPool will receive all the income earnings, including
but not limited to, compensation from the purchaser failing in the trade and the interest income from the alternative investment.
Section 4.03. Investment Earnings Allocation. All interest earnings in TexPool will be valued daily and credited to the
Participant's Accounts and SubAccounts monthly, on a pro rata allocation basis. All losses, if any, resulting from the investment
of monies in TexPool shall also be allocated on a pro rata allocation basis.
Section 4.04. Specific investment Requirements. Because TexPool is designed to give each Participant immediate access
LO their funds, the dollar weighted average maturity of the investments in TexPool will not exceed 120 days.
All collateral securing repurchase agreements will be repriced daily and maintained at a minimum of 100% coverage of the
originally invested principal amount, which shall be reviewed from time to time by the TexPool Advisory Board as part of the
Investment Policy.
Section 4.05. TexPool Advisory Board. There has been created the TexPool advisory board (the "Advisory Board ") which
consists of at least 10 members, each appointed by the Treasurer for a staggered term of three (3) years. The Advisory Board shall
review and approve an investment policy for TexPool. The Advisory Board shall also have responsibility for any modification or
other amendments of the fee structure which is more fully described in Section 5.01 herein. The Participant by execution of the
Participation Agreement hereby agrees to be bound by all policies, fee schedules, and other rules which maybe adopted by the Ad-
visory Board.
Section 4.06 Liability. Neither the Treasurer, the Trust Company, any Treasury employees, nor anyof the members of the
Advisory Board shall be held liable for any action or omission to act on behalf of the Treasury, Treasury employees, or the
Participants unless caused by gross negligence or willful misconduct.
ARTICLE V.
EXPENSES AND REPORTS
.Section 5.01. Fees and ExQenses. Attached hereto is a schedule of fees forbasic and special services. The Participant agrees
to pay to the Truss Company an amount set forth in the fee schedule which shall be sufficient to reimburse the Trust Company for
its actual costs of performing its duties under this Participation Agreement. Participant agrees that all fees shall be directly and
automatically assessed and charged against the Participant's Accounts and SubAccounts. The basic services fee shall be calculated
4
as a reduction in the daily income earned, thus only the net income shall be credited to the Participant's account. Fees for special
•services shall be charged to each Participant's account as they are incurred or performed A schedule of fees shall be sent annually
to the Participant. Fees shall only be changed upon the approval of the majority of TexPoors Advisory Board. Each Participant
will be notified thirty (30) days prior to the effective date of any change in the fee schedules.
Section .02. P ties for Losses . Ail actual costs, including but not limited to, losses of investment income for TexPool
associated with ACH returns or by failure to timely transmit a Wire Transfer for deposit will be charged against the Participant's
Accounts and SubAceounts unless such failurewas beyond the controlof the Participant. TheTrust Companywill makeevery effort
to mitigate any adverse cost being incurred by the Participant. The Trust Company shall only recover the actual costs incurred in
the event of any loss.
SMion 5.Q Deports. The Trust Company shall submit a written report to the Participant which shall include a detailed
listing of all transactions occurring in the Participant's Accounts and SubAecounts for the previous month, within the first five (5)
business days of the next succeeding month. Such report will indicate the balance remaining in the Participant's Accounts and
SubAccounts, the daily and monthly yields of interest earned, all deposits and withdrawals, and all expenses, including the basic
services fee and any special fees assessed, in accordance with generally accepted accounting principles. Additionally, the Trust
Company will maintain copies of the Participant's Accounts and SubAeeounts reports in physical or computer form for a minimum
of three prior fiscalyears. This information willbe available to assist the Participant in any special research or report request. Copies
of all Participants' reports shall be available for public examination at the Trust Company's offices at the Treasury. These reports
and summary information shall be presented to the Advisory Board All records shall be available for inspection at all reasonable
hours of the business day and under reasonable conditions. The Trust Company will attempt to keep confidential all historical
account information and current balances of the Participant. However, the Participant acknowledges that the Trust Company is
subject to the Open Records Act, TEX. REV. CIV. STAT. ANN. art. 6252 -17a, as amended
ARTICLE VL
SPECIFIC PARTICIPANT INFORMATION
Section 6.01. Account Number and Password . Each Participant shall be assigned a unique identifying number, and each
Authorized Representative of the Participant shall be assigneda unique identifying password Additionally, each Account and Sub-
account will be assigned a unique number. The Participant hereby agrees that the unique passwords and account numbers are
required to implement any deposit or withdrawal to the Participant's Accounts or SubAceounts. The Trust Company agrees that
such account numbers and passwords shall be maintained by the Trust Company and the Trust Company shall decline to disclose
said unique identifying information except with the consent of the Participant or the Participant's Authorized Representative.
Section 602. Bank Account. The Participant's local bank account and information is set forth on the attached routing
form. Any amendment or change to the above described information must be submitted in writing to the Trust Company and must
include clear instructions for effecting future deposit and withdrawal transactions. The Trust Company will implement these
changeswithin 15 business days of receiving the notification. TheTrust Companywill forward this information to the Rapid Deposit
Program Division of the Treasury.
Section 603. Notices. Any notices, Letters of Instructions, or other information required or permitted to be given
hereunder shall be given in writing and shall be deemed duly given when mailed by registered or certified mail, postage prepaid,
addressed or telefaxed as follows:
To the Particpant:
Participant Name CM OF B YTOWN
Contact Person MONTE MERCER, FTNANCE DMCTOR
Address
BAYTOWN, TEXAS 77522 -0424
0 Telephone No. 713/420-6531
TeleFax No. 713/420 -6586
5
0
To the Trust Company:
Trust Division
Texas State Treasury Department
P.O. Box 12608, Capitol Station
Austin, Texas 78711
Tekphone No. (512) 440 -4740 or call Toll Free:1 -800- 234 -LGIP
Telefax No. (512) 440 -4749
Seiction 6.04. Uam Identiffation Nu m . The Participant's taxpayer identification number assigned by the Internal
RevenueServiceis: 1- 74- 6000 -246 -6 . The Participant hereby agrees to notify the Trust Company of any change
affecting this Taxpayer Identification Number and agrees that unless and until so notified, the Trust Company shall be entitled to
rely on same in providing any and all reports or other information necessary or required by the Federal tax laws as amended from
time to time.
ARTICLE VQ.
MISCELLANEOUS
Section 7.01. Severability. If any provision of this Participation Agreement shall be held or deemed to be in fact illegal,
inoperative or unenforceable, the same shall not affect any other provision or provisions herein contained or render the same
invalid, inoperative or unenforceable to any extent whatsoever.
Section 7.02. Limitation of Rights. With the exception of the rights herein expressly conferred, nothing in or to be implied
from this Participation Agreement is intended or shall be construed to give any person other than the parties hereto any legal or
equitable right, remedyorciaim under or in respect to this Participation Agreement or anyof the covenants, conditions or provisions
herein contained; this Participation Agreement and all of the covenants, conditions and provisions hereof being intended to be and
beingfor the sole and exclusive benefits to the parties hereto as herein provided. The Participant furtheragrees that the Treasurer's
responsibilities hereunder are limited to the management and investment of TexPool and the providing of reports and information
herein required; neither the Treasurer nor the Trust Company shall be liable for any losses from investments and transfers made
in accordance with the procedures set forth in this Participation Agreement.
Section 7.03. Execution of Counterparts. This Participation Agreement may be simultaneously executed in several
separate counterparts, each of which shall be an original and all of which shall constitute but one and the same instrument.
Section 7.04. Applicable Law. This Participation Agreement shall be governed by and construed in accordance with the
laws of the State of Texas and is wholly performable in Travis County, Texas.
Section 7.05. Captions. The captions or headings in this Participation Agreement are for convenience only and in no way
define, limit, or describe the scope or intent of an provisions, articles, or sections of this Participation Agreement.
Section 7.06, Amendments. The Participant and the Trust Company may supplement, amend or modify this Partici-
pation Agreement only if evidenced in a writing signed by both parties.
Section 7.07. Termination This Agreement maybe terminated by either parry hereto, with or without cause, by tendering
30 days' prior written notice in the manner set forth in Section 6.03 hereof.
Section 7.0& Term. The continuance of this Participation Agreement is subject to and dependent upon appropriation
of the necessary funds by the Texas Legislature. Otherwise, unless terminated in accordance with Section 7.07, it shall be
automatically renewed on each anniversary date hereof.
In Witness Whereof the parties hereto have caused this Participation Agreement to be executed in multiple counterparts
as of the date first set forth above.
PARTICIPANT TEXAS STATE TREASURER
• 'Title: CITY MANAGER
Attest:
zz
Title:
ZIM
By:
Title: CITY CLERK