FINANCIAL POLICY MANUAL - Glenview...balances or amounts that cross multiple years. However, if a...

VILLAGE OF GLENVIEW ILLINOIS

FINANCIAL POLICY

MANUAL

Todd Hileman Village Manager

May 7, 2013

Section:FinancialPolicyOverview

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Village of Glenview Financial Policy Manual

TableofContentsI. Financial Policy Overview ............................................................................................................................ 3

II. Budget ......................................................................................................................................................... 4

A. Capital Projects Budgeting ...................................................................................................................... 5

B. Insurance/Risk Fund ................................................................................................................................ 5

III. Capital Assets (DRAFT) ............................................................................................................................. 7

IV. Capital Equipment Replacement Fund .................................................................................................. 10

V. Cost Allocation ........................................................................................................................................... 12

VI. Debt ....................................................................................................................................................... 14

A. Debt Management ................................................................................................................................ 14

B. Bond Record‐Keeping Policy .................................................................................................................. 14

VII. Facilities Repair and Replacement Fund (In Development) .................................................................. 16

VIII. Fund Balance ......................................................................................................................................... 17

IX. Investment ............................................................................................................................................. 19

X. Municipal Equipment Repair Fund ............................................................................................................ 27

XI. Permanent Fund .................................................................................................................................... 28

XII. New Property – Property Tax Levy Policy .............................................................................................. 30

XIII. Purchasing ............................................................................................................................................. 31

A. Procurement Policy ............................................................................................................................... 31

B. Credit Card Policy .................................................................................................................................. 32

C. Petty Cash Policy ................................................................................................................................... 33

D. PreIssued Checks ................................................................................................................................... 33

XIV. Special Service Areas – Project Cost and Interest Rate Amendment .................................................... 35

XV. Unclaimed Property ............................................................................................................................... 36

XVI. Appendix A: Board Policy Action ........................................................................................................... 37

XVII. Appendix B: Exhibit A to Capital Assets Policy (In Development) ......................................................... 39

XVIII. Appendix C: Investment Policy Glossary ........................................................................................... 40

XIX. Appendix D: Investment Policy Attachments ........................................................................................ 46


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The Village of Glenview would like to recognize

past Village President Kerry D. Cummings

(2005‐2013) for her leadership and

contributions in the effort to develop these

policies which will serve as an ongoing context

for management decisions in the future.


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I. FinancialPolicyOverviewThese comprehensive financial polices set forth the framework for financial planning anddecision‐making to preserve, promote, and enhance the fiscal stability in the Village ofGlenview. They have been carefully researched, drafted and developedwith the combinedtechnical experience of staff and the Village Board of Trustees. The policies includeadministrative functions some of which include budgeting, capital improvements, debt,investments, and procurement. These financial policies should be periodically reviewed toincludechanges in theprofession, toreflectchanges instatestatues, to incorporate industrystandardbestpractices,andtoreviewtheirimpactonservicequality.Each policy section begins with purpose and goals followed by fund description andmethodologywhereapplicable.Anyrelevantbestpracticesarethenidentified.Thepolicyisthendescribed in amanner that separates statutory andvillagepolicy requirements. If thepolicyhasanaccompanying,detailedproceduraldocumentitissonotedforreference.

Section:Budget

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II. BudgetI.PURPOSEThe Village of Glenview, Illinois has developed a Budget Policy to ensure the Village’scompliancewiththeIllinoisMunicipalCode(65ILCS5/8‐2‐9.1‐9.11)specifictotheadoptionandadherenceofamunicipalbudget.AllbudgetaryproceduresoftheVillagewillconformtostateregulationsandGenerallyAcceptedAccountingPrinciples(GAAP)forgovernmentfundsusing amodified accrual basis of accounting. Proprietary funds are accounted for using theaccrualbasisofaccounting.Inadditiontobeinglegallyrequired,adoptionandadherencetoabudgetisasoundtooloffinancialmanagement.II.BUDGETREQUIREMENTSANDADOPTIONTheVillageshallhaveaBudgetOfficer(currentlydesignatedbyVillageCodetobetheVillageManager). The Budget Officer will compile an annual budget which contains reasonableestimated revenues and recommended expenditures for the upcoming fiscal year (Sec. 8‐2‐9.3). Thebudgetmustbebalanced,meaning the recommendedexpendituresdonotexceedreasonably estimated revenues and other available funds. The balanced budget must alsoadheretotheminimumstandardssetforthintheVillage’sFundBalancePolicy.The budget shall contain actual or estimated revenues and expenditures for the two yearsimmediately preceding the fiscal year forwhich the budget is prepared (Sec. 8‐2‐9.3). Thebudgetwillalsoshowtheoriginalandrevisedbudgetfromthepreviousyear.Additionally,thebudgetshallillustratethespecificfundfromwhicheachanticipatedexpenditureshallbemadeandthebudgetwillbeadoptedatthefundlevel;thatisthelevelbywhichactualexpenditurescannotexceedtheamountbudgeted(Sec.8‐2‐9.3).The Village’s budget will be developed on an annual basis. The Village’s budget will beprepared in a line item format and presented and adopted by appropriation category. Thepurposeoftheformatistoclearlyoutlinedirectandindirectcosts,capitaloutlayandrevenueswhereappropriate.Adoption of the annual budget by the Village Board shall be in lieu of an appropriationsordinance.TheadoptionofthebudgetwillfollowthetimelineandspecificationssetforthintheIllinoisMunicipalCode(Sec.8‐2‐9.9).Thebudgetmustbeadoptedbeforethe1stdayofthefiscalyear(Sec.8‐2‐9.4).TheVillage’sfiscalyearbeginsJanuary1standendsDecember31st.

Section:Budget

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III.BUDGETAMENDMENTSAsperILStateStatute, theBudgetOfficeristoensurethatnoexpendituresaremadebytheVillageexceptasauthorizedbythebudget(Sec.8‐2‐9.2).Ifhowever,thebudget,asapprovedby fund,needs revision, theVillageBoardhas theauthority to revise thebudgetbydeletingandaddingtothebudget.Norevisionofthebudgetshallbemadeincreasingthebudgetintheeventfundsarenotavailabletoeffectuatethepurposeoftherevision(Sec.8‐2‐9.6).ABudgetAmendment is prepared as a Resolution and does not require a public inspection, noticeand/orhearingasisrequiredfortheoriginalbudget.

A. CapitalProjectsBudgeting

I.PURPOSEThepolicyprovidesforproject‐lengthbudgetingsothat fundswouldbeappropriatedonce with no requirement for an annual rebudgeting of awarded contract projectbalancesoramountsthatcrossmultipleyears.However, ifaprojectshouldexceeditstotalexpenditureauthority,anexplanationofthesituationandarequestforadditionalfundingwouldbepresentedtotheBoardforitsconsideration.II.POLICYThe Village budgets for capital projects on a project‐length basis. The CapitalImprovementProgram(CIP)isafive‐yearplanfortheacquisition,developmentand/orimprovement of the Village's infrastructure. The Capital Improvement Program isprojected for five years and updated annually. Any modifications to increase thebudget for a project shall be acted upon by the Village Board. Any projectappropriations that are unspent at the end of a fiscal year will be retained for thespecificpurposeofcompletingtheauthorizedproject.Shouldfundsbeavailableattheclose of a project, such unspent funds will be retained in fund balance and may bereprogrammedthroughtheCIPbudgetprocessforothercapitalprojects.Tominimize the issuanceof debt, theVillagewill attempt to support capital projectswithgrants,operatingrevenues(fromitsutilityfundsandMotorFuelTax)andexcessfundbalances(primarilyfromtheCorporateFund).

B. Insurance/RiskFund

I.PURPOSEThe Insurance and Risk Fund is a Village Internal Service Fund. The Risk Divisionaccountsfortheannualcostsincurredforgeneralliability,workers’compensationandpropertylossesfortheVillage.TheInsuranceDivisionaccountsfortheannualcostsfor

Section:Budget

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health, life and dental insurance costs. Other Departments and Funds are chargedthroughChargesforServicesfortheirproportionalshareoftheseinsurancecosts.II.BUDGETThepolicyistobudgetclaimsatanactuarially‐determined55%confidencelevel.TheIncurredButNotReported(“IBNR”)potentiallossisrecordedonthebalancesheetalsoatanactuarially‐determined55%confidencelevel.

Section:CapitalAssets(DRAFT)

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III. CapitalAssets(DRAFT)I.PURPOSEGovernmental Accounting Standards Board (GASB) Statement 34 requires municipalgovernments to capitalize assets (i.e. land, roads, bridges, drainage systems,water systems,vehicles, equipment, etc.) and include the financial impact of these capitalized assets in thegovernmentwidefinancialstatements. Onceanasset iscapitalized, it isdepreciatedover itsuseful life. Thispolicy identifiesuseful lives for the individualasset classesof theVillageaswell as a threshold for assets that are not added to the capital asset accounts to ensurecontinuedcompliancewithStatement34.II.CLASSESANDCAPITALIZATIONTHRESHOLDS

Capital assets are typically defined as all tangible assets including but not limited to land,improvements to land, rights of way, buildings, vehicles, equipment, and infrastructure(includingstreets,intersections,sidewalks,stormsewers,streetlighting,etc.)thatareusedinoperations and have initial useful lives extending beyond a fiscal year. In addition, capitalassetstypicallyrequiresubstantialfinancialresourcestoacquire.Based on this definition of a capital asset, the Village has established classifications andfinancial thresholds for the tangible assets owned by the Village. By utilizing theseclassificationsandthresholds,theVillagehasbeenandwillcontinuetobeabletodistinguishbetween those tangible assets that should be reported in the Government Wide FinancialStatementsinconjunctionwithStatement34andthoseassetsthatdonotneedtobereported.Individual items with costs below these thresholds will be expensed. The costs of normalmaintenanceandrepairs thatdonotadd to thevalueof theassetormateriallyextendassetlives are not capitalized. Improvements are capitalized and depreciated over the remainingusefullivesoftherelatedcapitalassets.Theclassificationsandthresholdsforallofthecapitalassets of the Village are detailed in Exhibit A to this document according to the columnsentitled“ClassofAsset”and“TypeofActivityCapitalized”.III.DETERMININGTHEACQUISTIONCOST/VALUEOFCAPITALASSETSGASBStatement34requiresmunicipalgovernmentstoreportthehistoricorestimatedhistoriccostofacquiringorconstructingacapitalasset. Purchasedassetsarevalued foraccountingpurposes at the total of their purchase price and any related costs for transportation,installation,orotherdirect,identifiableexpenseinvolvedinprocuringtheassetandreadyingitfor its intended use. Costs for training and maintenance and warranty agreements are notconsideredpartoftheassetcostandshouldbeexpensed.Constructed assets are valued at the total amount paid for acquiring or improving the assetincluding land, labor, materials, engineering design and inspection fees, constructionmanagementfees,chargesbybrokersorothers,appraisalfees,sitepreparationfees,andlegal,


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title,andfilingfees. Thisalsoincludestheinterestincurredduringtheconstructionphaseofcapital assets of business‐type activities. Interest is capitalized on proprietary fund assetsacquired with tax‐exempt debt. The amount of interest to be capitalized is calculated byoffsetting interest expense incurred from the date of the borrowing until completion of theprojectwithinterestearnedoninvestedproceedsoverthesameperiod.TheAdministrativeServicesDepartmentwillmaintainthecapitalizedamounts.IV.DEPRECIATIONTheVillagewilldepreciateallitemsonastraightlinebasis.Intheyearofacquisitionandthefinalyearoftheassetsusefulyear,theassetwillbedepreciatedusingthehalfyearassumption.Thismeansthattherewillbehalfyeardepreciationineachoftheseyears,nomatterthedatethe asset is acquired or disposed. The useful life is dependent on the type of asset and isdetailedbytheClassofAssetsonExhibitAtothisdocument.V.MISCELLANEOUS

A. REHABILITATIONS,RECONSTRUCTION,ANDREPAIRS

Whenanyitemofinfrastructureisfullyre‐constructed—otherthanbytherubblizationmethodinwhichthepreviouslyexistingroadisusedasthenewroadbase‐‐thecostofthe old asset, if determinable, is removed from the capital accounts, along with itsrelated accumulated depreciation. Routine repairs andmaintenance, e.g., intermittentpavementrepairsandpotholepatching,arenotcapitalizedbut insteadarechargedasexpensed.

B.SALESAND/ORRETIREMENTOFASSETSWhen a capital asset is disposed of, sold, or retired, its cost and accumulateddepreciationareremovedfromthebooksandagainorloss,ifany,isrecognized.Anassetisremovedfromthecapitalassetaccountswhenitisdeterminedthattheassetisno longeroperable,hasbeenreplaced,or isno longeravailable foruse.Retirementmay consist of sale, scrap, or donation of the asset. The Administrative ServicesDepartment should be notified of any retirements or sales in order to record thesetransactions.C.RECOGNITIONOFCAPITALASSETSDONATEDORPROVIDEDTOTHEVILLAGE

ManyoftheassetsacquiredbytheVillageareacquiredbydonationorconveyance.TheVillagewillrecognizedonatedorconveyedassetsasbelongingtotheVillageonthedateuponwhichthe Village formally accepts the donated/conveyed asset. Once this formal acceptance iscomplete,theassetwillbeplacedintotheappropriateclassificationaccordingtoExhibitAand


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theproperprocedurestoaccount forthatassetwillbe initiatedfromthatpoint forward(i.e.annualdepreciation,etc).Donatedcapitalassetsarerecordedatestimatedfairmarketvalueatthedateofdonation.

Section:CapitalEquipmentReplacementFund

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IV. CapitalEquipmentReplacementFundI.PURPOSEThe Village of Glenview, Illinois, has established a Capital Equipment Replacement Fund(“CERF”)toaccountforthefundsannuallysetasideforthetimelyreplacementofvehiclesandequipment thatmeet the guidelines set forth in this policy. Equipment includes computers,printers, copiers, data storage devices, scanners, telecommunications equipment and fleetshop equipment. The Board established a CERF fund balance policy in 2005 that adjustedassetsandchargesforservicesbasedontheimplementationofGASB34.TherearenoGFOAstandards on what a replacement fund balance dollar amount should be or it’s cycle. TheBoardlastupdatedCERF’sfundbalancepolicyonAugust18,2009andanApril1,2013reviewresultedinastatusquorecommendation.II.CAPITALEQUIPMENTREPLACEMENTSCHEDULETheVillagewillmaintaina capitalequipment replacement schedule. Outfittedvehiclesandequipment classes valued over $5,000 can be included in the schedule. The equipmentreplacement schedule will be used to derive the annual funding needs for vehicles andequipment.Itwillalsobeusedtoprojectfuturereplacementdatesandcosts.Thevehicleandequipmentreplacementschedulewillbereviewedandupdatedonanannualbasis.Vehicle and equipment replacement schedules will be determined by their useful life. Thenatureandintensityofusageaswellasmaintenancecostsaretobetakenintoaccountwhendetermining the useful life. Timely replacement is important for controlling vehicleavailability,safety,reliability,andefficiency.III.CERFFUNDREVENUESANDEXPENSESResourceswill be accumulated in theCERFFund from theproceeds from the saleof assets,interest income and “charges for services” from each department for their replacement ofvehiclesandequipment. VehiclesandequipmentwillbepurchasedfromtheCERFFundandtheassetswillbeappropriatelyreflectedontheVillage‐widebalancesheet.Charges for services are calculated amounts based on the projected life of an asset, theanticipated replacement cost of the vehicle/equipment, the anticipated salvage value ofequipment and any investment earnings on resources accumulated during the life of theequipment.Chargesforserviceswillbebudgetedbydepartment.Chargesforserviceswillbemade against the operating department budget andwill then be transferred into the CERFFund in twelve flat monthly amounts. This process is the same for all Funds. Assets arescheduledtobegintoreceiveaCERFcontributiontheyearaftertheyarepurchased.

Section:CapitalEquipmentReplacementFund

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Once an asset is fully funded, no additional chargeswill be calculated norwill transfers bemade. For purposes of this policy, “fully funded” shall mean that the Life to Date (“LTD”)Balanceaccumulatedfortheassetisgreaterthanorequaltoits’replacementcost.AnnualprojectionsensurethattheFundwillhavesufficientresourcestoreplaceeverypieceofequipment on its scheduled due date. The CERF charge policy is based on a 5‐year rollingaverageofvehicleandequipmentreplacementcosts.Usingarolling5‐yearaveragekeepsthechargesforservicessomewhatlevelandrelievesanyhighorlowbudgetdemandsforcapitalassets.IV.FUNDBALANCECERF will maintain a fund balance of 40% accumulated depreciation (or reserves). Thisamount is sufficient tomeet theVillage’s annual vehicle and equipment replacement needs.Thefundbalancewillbemonitoredandevaluatedonanannualbasistomanageoperationalchanges. Thisapproachwillkeepthe fundbalancemonitoredwhile “smoothing” theannualCharges for Services from other departments and funds. The CERF Fund will be analyzedannuallyandarecommendationwillbemadeshouldfundingexceedorfallshortofthetarget.

Section:CostAllocation

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V. CostAllocation

I.PURPOSEANDGOALS

The purpose of the Cost Allocation Policy is to ensure all funds record expenses for goods,services, andpersonnel in the fund that theactivityoccurred. Thereare threemethods theVillage uses to allocate these expenses: Direct Charges, Transfers and Charges for Services.The direct chargemethod is themost common and preferred in allocating costs; however,whenitisnotfeasiblethetransfermethodcanbeused.ThechargeforservicemethodisusedexclusivelywithintheInternalServiceFunds.Multiplesmethodsarerequiredtocalculatecostof service because the resources used to support one activitymay also be used to supportotheractivities.ThispolicyfollowstheGFOArecommendedbestpracticesforpricinginternalservices.

II.METHODS

DIRECTCHARGES

Direct Charges are expenses related to goods, services and personnel that support Villageoperationsandarechargeddirectlytotheappropriatefundatthepointthecostisincurred.Goods,servicesandpersonnelcosts,thataredirectlycharged,arereviewedannuallyandareadjustedappropriatelyforthecomingyear’sbudgettoreflectVillageAdministrativeGoalsanddepartment’s supporting business plans. The direct chargemethod is preferred because itshowstheresourcesneededbyfundtosupportVillageprograms.

COSTALLOCATIONTRANSFERS

Transferscanallocatecostsbetweenfunds.Transfersareusedwhenitmaynotbefeasibletoanticipate the budget and directly charge a fund. Transfers allocate costs fromone fund toanotheroncetheactualexpenseisknown.

CHARGESFORSERVICES

Charges for Services is an Internal Service Fund expense related to goods, services andpersonnelthatsupportsthedeliveryofservicestootherdepartments.InternalServiceFundsarefundsthatareusedtoaccountfortheVillage’scostofdeliveringservicestodepartmentswithintheVillageandotheragenciesandthese fundsexclusivelyusecharges forservicestoaccount for these services and cost reimbursements. Currently the Village maintains fourInternal Service Funds: the Municipal Equipment Repair Fund, the Capital EquipmentReplacementFund, the Insurance andRiskFund, and theFacilitiesRepair andReplacementFund.Chargesforservicesaredevelopedbyappropriatingtheproportionalamountfromeach

Section:CostAllocation

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department/fund/agencytoequaltheirshareoftheprojectedexpenditure.Variousmeasuresare applied to the cost of the good or service to determine the proportional share and areadjustedannuallytoensureaccuracy.

Section:Debt

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VI. Debt

A. DebtManagement

I.PURPOSEANDGOALSThe Village of Glenview faces continuing capital infrastructure requirements tomeetthe increasingneedsof its residents. The cost of these requirementswill bepartiallyfundedthroughtheissuanceofvarioustypesofdebtinstruments. TheVillage shall endeavor to attain the highest possible credit rating for each

debtissue. The Village shall take all practical precautions to avoid any financial decision,

which will negatively impact current credit ratings on existing or future debtissues.

TheVillageshalleffectivelyutilizedebtcapacityinrelationtoVillagegrowthandtaxburdentomeetlong‐termcapitalrequirements.

When issuing debt, the Village shall assess financial alternatives to include,wheneverfeasible,categoricalgrants,revolvingloansorotherstate/federalaid.

TheVillage'sfinancialmanagementshallseektominimizedebtinterestcosts. The Village shall seek to improve the overall well‐being of the residents,

maintain and improve essential municipal services, and enhance the financialcapabilityoftheVillage.

B. BondRecord‐KeepingPolicyI.PURPOSEThe policy conforms to the financial regulatory reform called the Dodd‐Frank WallStreet Reform and Consumer Protection Act (“Dodd‐Frank Act”). Since tax‐exemptbond issues are aprimary financial toolusedby theVillageand theVillage currentlymaintains all bond records, monitors arbitrage, and fulfills all continuing disclosurerequirementsaspartof itsbondpost‐issuancecomplianceprogram,thebondrecord‐keepingpolicyservesasaformaldocumentationofcompliance.II.POLICYThepolicyisadoptedbyResolution12‐80and: Designatesacomplianceofficer; Providesfor anannualreviewmadetotheBoardthat includesastatementof

arbitragerebateliabilityandbondrecord‐keepingcompliance;

Section:Debt

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Supersedes the Village’s current record retention policy for bond documentsfromtwoyearsafterthecancellationorduedatetoaslongasthebondsremainoutstandingplusthreeyears;and

Specifiesmaintenanceofallbonddocumentsrelatedtoa transaction includingresolution, ordinance, legal opinions, certifications, Official Statements, etc. aswell as all documents related to the investment and expenditure of the bondproceeds.

Section:FacilitiesRepairandReplacementFund(InDevelopment)

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VII. FacilitiesRepairandReplacementFund(InDevelopment)HoldSection:Policyindevelopment.

Section:FundBalance

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VIII. FundBalanceI.PURPOSEThe Village of Glenview has created this fund balance policy to provide a reserve for thefollowing funds (Corporate, Water, North Maine, Sewer, Municipal Equipment Repair Fund(MERF),CapitalEquipmentReplacementFund(CERF),FacilityReplacementandRepairFund(FRRF),InsuranceandRisk). TheFundBalancePolicyfollowsgenerallyacceptedaccountingprinciples(GAAP)andhasbeendevelopedto:

Ensurestableservicedelivery Providereservestomeetunanticipatednonemergencyexpenditures Smooththeeffectsofannualchangesintaxratesand/orstructure Providesufficientcashflowforfinancialneeds DemonstratefinancialstabilityandtopreservetheVillage’sbondrating.

II.CORPORATEFUNDBALANCEThe Corporate Fund Balance will be maintained at 30%‐40% of total expenditures. Totalexpendituresincludetransfersoutofthefund.III.UTILITYENTERPRISEFUNDBALANCEThe fund balance of the Utility Enterprise Funds (Water, Sewer, and NorthMaine) includesfixedassets,capital,debtandcash.Thegoaloftheutilityfundsistoremainself‐sufficient.Areservecashbalancepolicyhasbeenputintoplacetoensurepositivecashflowforoperations.Thisreservebalanceis30daysofoperatingexpenditures,excludingcapitalanddebtservice.IV.MAINTENANCEEQUIPMENTREPAIRFUND(MERF)BALANCEThe MERF Fund provides maintenance and repair services for vehicles and equipmentthroughout the year. These services are billed to departments, which then fund MERFoperations.TheMERFFundBalanceistobemanagedtoazerocashbalance.Intheeventthefundexperiencesavariancefromazerobalance,aplanistobeputintoplacetomanagebacktoazerobalance.V.CAPITALEQUIPMENTREPLACEMENTFUND(CERF)BALANCEThe CERF Fund provides funding, through annual department contributions, for thereplacementofcapitalassets.TheFundBalanceistobemaintainedat40%ofthecalculatedaccumulatedreserves.

Section:FundBalance

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VI.FACILITYREPLACEMENTRESERVEFUND‐ HoldSection:Policyindevelopment.VII.INSURANCE/RISKFUNDBALANCEThe Insurance/Risk Fund should be self‐sufficient (expenses are covered by charges forservice revenues) and routinely reviewed to incorporate new data. The fund balance istargeted at a minimum level to cover 30‐60 days of operating expenses plus an amountavailableforunanticipatedclaims.

Section:Investment

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IX. InvestmentI.PURPOSEItisthepolicyoftheVillageofGlenview,Illinois(the"Village")toprudentlyinvestpublicfundsin a manner which will provide the highest investment return with the maximum securitywhilemeetingthedailycashflowdemandsoftheVillageandconformingtoallstatestatutesgoverningtheinvestmentofpublicfunds.II.SCOPEThisinvestmentpolicyappliestoallfinancialassetsoftheVillage.ThefinancialassetsofthePoliceandFirefighter'sPensionFundsaresubjecttotheordersoftheirrespectiveBoardsofTrustees. The financial assets of the Village of Glenview Public Library are subject to thedirectionoftheirrespectiveBoardofTrustees. ThefollowingfundsareaccountedforintheVillage'sComprehensiveAnnualFinancialReportandinclude:Funds:

GeneralFundSpecialRevenueFundsCapitalProjectFundsEnterpriseFundsTrustandAgencyFundsAnynewfundcreatedbytheVillageBoard,unlessspecificallyexemptGlenviewPublicLibraryFunds.

III.PRUDENCEInvestments shall be made with judgment and care, under circumstances then prevailing,which persons of prudence, discretion and intelligence exercise in themanagement of theirownaffairs, not for speculation, but for investment, considering theprobable safetyof theircapital,aswellastheprobableincometobederived.The standardofprudence tobeusedby investmentofficials shall be the "prudentperson"standard and shall be applied in the context of managing an overall portfolio. Investmentofficials acting in accordance with written procedures and the investment policy andexercisingduediligenceshallberelievedofpersonalresponsibilityforanindividualsecurity'screditriskormarketpricechanges,provideddeviations fromexpectationsarereportedinatimelyfashionandappropriateactionistakentocontroladversedevelopments.IV.OBJECTIVETheprimaryobjectives,inpriorityorderoftheVillage'sinvestmentactivitiesshallbe:

Section:Investment

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Safety:Safetyofprincipalistheforemostobjectiveoftheinvestmentprogram.InvestmentsoftheVillageshallbeundertakeninamannerthatseekstoinsurethepreservationofcapital intheportfolio.

A.CreditRisk:CreditRiskistheriskoflossduetothefailureofthesecurityissuerorbacker.Creditriskmaybemitigatedby:

• Limiting investments to the safest types of securities or other allowableinvestments;

• Pre‐qualifying the financial institutions, broker/dealers, intermediaries, andadviserswithwhichtheVillagewilldobusiness;and

• Diversifying the investment portfolio so that potential losses on individualsecuritiesorotherallowableinvestmentswillbeminimized.

B.InterestRateRisk:

Interest rate risk is the risk that themarketvalueof securitiesorotherallowableinvestments in the portfolio will fall due to changes in general interest rates.Interestrateriskmaybemitigatedby:

• Structuring the investment portfolio so that securities or other allowableinvestmentsmaturetomeetcashrequirementsforongoingoperations,therebyavoidingtheneedtosellsecuritiesorotherallowableinvestmentsontheopenmarketpriortomaturity;and

• By investing operating funds primarily in shorter‐term securities or otherallowableinvestments.

Liquidity:The investment portfolio should establish adequate liquidity to meet all reasonablyanticipated aswell as unforeseen expenditures. This is accomplishedby structuring theportfolio so that securities or other allowable investmentsmature concurrentwith cashneedstomeetanticipateddemands.Furthermore,sinceallpossiblecashdemandscannotbe anticipated, the portfolio should provide adequate liquidity tomeet unexpected cashneeds.Liquiditycanbeachievedutilizingsecuritieswithactivesecondarymarkets,moneymarket accounts and/or savings deposit accounts offering daily liquidity, or other liquidoptionsacceptableunderILCS235.ReturnonInvestments:Return on investment is of tertiary concern when compared to the safety and liquidityobjectivesdescribedabove.Theinvestmentportfolioshallbedesignedwiththeobjectiveof attaining amarket rate of return throughout economic cycles, taking into account theinvestmentriskconstraintsandliquidityneeds. Investmentsare limitedtovery lowrisksecuritiesorotherallowableinvestmentsinanticipationofearningafairreturnrelativeto

Section:Investment

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the riskbeingassumed. Securities shallnotbesoldprior tomaturitywith the followingexceptions:

1) Adecliningcreditsecuritycouldbesoldearlytominimizelossofprincipal;2) Asecurityswapwouldimprovethequalityyield,ortargetdurationintheportfolio;or3) Liquidityneedsoftheportfoliorequirethatthesecuritybesold.

Legality:The investment activities of the Village will conform to federal, state and local legalrequirements.

V.DELEGATIONOFAUTHORITYAuthoritytomanagetheVillage'sinvestmentprogramisderivedfromthefollowing:The establishment of investment policies is the responsibility of the Village Board.ManagementandadministrativeresponsibilityfortheinvestmentprogramisdelegatedtotheVillageManagerorhis/her investmentdesignee1,whoshallestablishwrittenprocedures fortheoperationofthe investmentprogramconsistentwiththis investmentpolicy. Proceduresshould include references to: safekeeping, delivery vs. payment, investment accounting,repurchase agreements, wire transfer agreements, collateral/depository agreements andbanking service contracts. Such procedures shall include explicit delegation of authority topersons responsible for investment transactions. No person may engage in an investmenttransactionexceptasprovidedunderthetermsofthispolicyandtheproceduresestablishedby the Village Manager. The Village Manager shall be responsible for all transactionsundertaken and shall establish a systemof controls to regulate the activities of subordinateofficials.TheVillageManagermayamendthewrittenproceduresinamannernotinconsistentwiththispolicyorwithstatestatutes.VI.ETHICSANDCONFLICTSOFINTERESTIndividuals involved in the investment process shall refrain frompersonal business activitythatcouldconflictwiththeproperexecutionandmanagementoftheinvestmentprogram,orthat could impair their ability to make impartial decisions. Individuals involved in theinvestment process shall disclose any interests in financial institutions with which theyconduct business. In addition, such individuals shall disclose any personalfinancial/investment positions that could be related to the performance of the investmentportfolio. Individuals involved in the investment process shall refrain from undertakingpersonalinvestmenttransactionswiththesameindividualwithwhombusinessisconductedonbehalfoftheVillage.

1 Village Manager shall mean “Village Manager or his/her investment designee” wherever Village Manager is stated in the document.

Section:Investment

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VII.AUTHORIZEDFINANCIALDEALERSANDINSTITUTIONSThe Village Manager will maintain a list of financial institutions authorized to provideinvestment services. In addition, a list will also be maintained of approved securitybroker/dealers. Thesemay include "primary"dealersor regionaldealers thatqualifyunderSecuritiesandExchangeCommissionRule15C3‐1(uniformnetcapitalrule).Nopublicdepositshallbemadeexceptonqualifiedpublicdepositoryasestablishedbystatestatutes.All financial institutions and broker/dealers who desire to become approved bidders forinvestmenttransactionsmustsupplytheVillagewiththefollowing:

• Auditedfinancialstatements;• ProofofNationalAssociationofSecurityDealers(NASD)certification;• Proofofstateregistration;and• CertificationofhavingreadtheVillage'sInvestmentPolicy,(Attachment#1).

An annual review of the financial condition and registration of qualified bidders will beconductedbytheVillage.A current audited financial statement must be on file for each financial institution andbroker/dealerthroughwhichtheVillageinvests.VIII.AUTHORIZEDANDSUITABLEINVESTMENTSThe Villagemay invest in any type of security allowed for in Illinois statutes regarding theinvestmentofpublicfunds.Currentapprovedinvestmentsinclude: Bonds, notes, certificates of indebtedness, treasury bills, treasury strips or other

securities or other allowable investments now or hereafter issued, which areguaranteedbythefullfaithandcreditofthegovernmentoftheUnitedStatesofAmericaastoprincipalandinterest.

Bonds,notes,debentures,orothersimilarobligationsofthegovernmentoftheUnitedStatesofAmericaoritsagencies.

Interest bearing savings accounts, interest bearing certificates of deposit or interestbearing time deposits or any other investment constituting direct obligations of anyinstitutionasdefinedbytheIllinoisBankingActandisinsuredbytheFederalDepositInsuranceCorporation.

TheIllinoisFunds,includingtheIllinoisPublicTreasurer'sInvestmentPool,(IPTIP)andtheIllinoisMetropolitanInvestmentFund(IMET).

Short‐term obligations of corporations (banker's acceptances and commercial paper)organizedintheUnitedStateswithassetsexceeding$500millionandratedatthetimeof purchase at the highest classification established by at least two standard ratingservices.Suchinvestmentsmustmaturewithin180daysfromthedateofpurchaseandmay not exceed 10% of the corporations’ outstanding obligations. No more than a

Section:Investment

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combined 33% of the Village's funds may be invested in banker's acceptances orcommercialpaperatanygiventime.

Short‐termdiscountobligationsof theFederalNationalMortgageAssociation (FNMA)orinsharesofotherformsofsecuritiesorotherallowableinvestmentslegallyissuedbysavings and loan associations incorporated under the laws of this state or any otherstateorunder the lawsof theUnitedStates. Investmentsmaybemadeonly in thosesavingsandloanassociationsofwhichthesharesorinvestmentcertificatesareinsuredbytheFederalDepositInsuranceCorporation(FDIC).

Investment options suitable under ILCS235 including Fixed Rate General ObligationMunicipalBondswhosecreditqualityisrestrictedto“AA”orbetter.

IX.COLLATERALIZATIONItisthepolicyoftheVillageandinaccordancewiththeGFOA'sRecommendedPracticesontheCollateralization of Public Deposits, Attachment #3, that the Village requires that funds ondepositinexcessofFDIClimitsbesecuredbysomeformofcollateral,includingsuretybondsorlettersofcredit.TheVillagewillacceptanyofthefollowingassetsascollateral:

• GovernmentSecurities• ObligationsofFederalAgencies• ObligationsofFederalInstrumentalities• FixedRateGeneralObligationMunicipalBondsrated“AA”orbetter• ObligationsoftheStateofIllinois.

TheVillagereservestherighttoaccept/rejectanyformoftheabovenamedsecurities.TheVillagealsorequiresthatalldepositoriesthatholdVillagedepositsinexcessoftheFDIClimitmust agree to utilize theGFOA’sRecommendedPractices of Collateralization of PublicDepositsasoutlinedinAttachment3.Theamountofcollateralprovidedwillnotbelessthan110%ofthefairmarketvalueofthenetamountofpublicfundssecured. Theratiooffairmarketvalueofcollateraltotheamountoffunds secured will be reviewed monthly by the Village, and additional collateral will berequiredwhentheratiodeclinesbelowthelevelrequiredandcollateralwillbereleasedifthefairmarketvalueexceedstherequiredlevel.Pledgedcollateralwillbeheldinsafekeeping,byanindependentthirdpartydepository,ortheFederalReserveBankofChicago,designatedbytheVillageandevidencedbyasafekeepingagreement. TheVillageshallapprove, inwriting,theprocessforthereleaseofsubstitutionofpledgedassets.TheVillagerealizesthatthereisacost factor involved with collateralization and the Village will pay any reasonable andcustomaryfeesrelatedtocollateralization.

Section:Investment

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X.SAFEKEEPINGANDCUSTODYAll security transactions, includingcollateral for repurchaseagreements,entered intoby theVillage shall be conducted on a delivery‐verses‐payment (DVP) basis. Securities or otherallowable investments will be held by a third party custodian designated by the VillageManagerandevidencedbysafekeepingreceipts.XI.DIVERSIFICATIONInordertoreducetheriskofdefault, theinvestmentportfoliooftheVillageshallnotexceedthefollowingdiversificationlimitsunlessspecificallyauthorizedbytheVillageBoard:

• Moniesdepositedatafinancialinstitutionshallnotexceed75%ofthecapitalstockandsurplusofthatinstitution.

• Commercialpapershallnotexceed33%oftheVillage'sinvestmentportfolio.• DepositsintheIllinoisPublicTreasurer'sInvestmentPoolshallnotexceed50%ofthe

Village'sinvestmentportfolio.• Brokered and negotiable certificates of deposit shall not exceed 25% of the Village's

investmentportfolio.XII.MAXIMUMMATURITIESTotheextentpossible,theVillagewillattempttomatchitsinvestmentswithanticipatedcashflowrequirements. Unlessmatchedtoaspecificanticipatedexpenditure,theVillagewillnotdirectlyinvestinsecuritiesmaturingmorethanthreeyearsfromthedateofpurchase.Reserve fundsmaybe invested in securitiesorotherallowable investmentsexceeding threeyearsifthematuritiesofsuchinvestmentsaremadetocoincideasnearlyaspracticablewiththeexpecteduseofthefunds.XIII.INTERNALCONTROLSThe Village Manager is responsible for establishing and maintaining an internal controlstructure designed to insure that the assets of the Village are protected from loss, theft ormisuse.Theinternalcontrolstructureshallbedesignedtoprovidereasonableassurancethattheseobjectivesaremet.Theconceptofreasonableassurancerecognizesthat(1)thecostofthecontrolshouldnotexceedthebenefitslikelytobederived;and(2)thevaluationofcostsandbenefitsrequireestimatesandjudgmentsbymanagement.Accordingly,theVillageManagershallestablishaprocessforannualindependentreviewbyanexternalauditortoassurecompliancewithpoliciesandprocedures.TheVillageManagermayinitiateadditionalreviewsathis/herdiscretion.Theinternalcontrolsshalladdressthefollowingpoints:

Section:Investment

25


• Controlofcollusion• Separationoftransactionauthorityfromaccountingandrecordkeeping• Custodialsafekeeping• Avoidanceofphysicaldeliveryofsecuritiesorotherallowableinvestments• Cleardelegationofauthoritytosubordinatestaffmembers• Writtenconfirmationoftelephonetransactionsforinvestmentsandwiretransfers• Developmentofaprocedureformakingwiretransfers.

XIV.PERFORMANCESTANDARDSTheinvestmentportfoliowillbemanagedinaccordancewiththeparametersspecifiedwithinthis policy. The portfolio should obtain a market average rate of return during amarket/economic environment of stable interest rates. Portfolio performance should becomparedtoappropriatebenchmarksonaminimumquarterlybasis.MarketYield(Benchmark):The Village's investment strategy is passive. Given this strategy, the basis used by theVillageManagertodeterminewhethermarketyieldsarebeingachievedshallbethethreemonthU.S.TreasuryBill.

XV.REPORTINGTheVillageManagershallhavepreparedaninvestmentreportat leastquarterly, includingasuccinct management summary that provides a clear picture of the status of the currentinvestment portfolio. Thismanagement summarywill be prepared in amannerwhichwillallow theentity toascertainwhether investmentactivitiesduring the reportingperiodhaveconformedtotheinvestmentpolicy.Thereportmayincludethefollowing:

• Alistingof individualsecuritiesorotherallowable investmentsheldattheendofthereportingperiod.

• AverageweightedyieldtomaturityofportfolioonVillageinvestmentsascomparedtoapplicablebenchmarks.

• Listingofinvestmentsbymaturitydate• Thepercentageofthetotalportfoliowhicheachtypeofinvestmentrepresents• Thepercentageofthetotalportfoliowhicheachinstitutionisholding• Thepercentageofthetotalportfoliobrokendownbydefinedmaturityperiods• Principalandtypeofinvestmentbyfund.

MarkingtoMarket:A statement of themarket value of the portfolio shall be issued at least quarterly and amanagementsummaryshallbeprovidedtothegoverningbody.Thiswillensurethattheminimal amount of review has been performed on the investment portfolio in terms ofvalue and subsequent price volatility. Review should be consistent with the GFOARecommended Practice on Mark‐to‐Market Practices for State and Local GovernmentInvestmentPortfoliosandInvestmentPools(Attachment#3).

Section:Investment

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XVI.INVESTMENTPOLICYADOPTIONTheVillageofGlenview'sinvestmentpolicyandanyamendmentthereto,shallbeadoptedbyresolution of the Village. This policy shall be reviewed on a regular basis by the VillageManager tomonitor suchmatters as conformance to accepted practices, conformance withstandardssuchasGFOA,andchangestothesuitabilityofinvestments.

Section:MunicipalEquipmentRepairFund

27


X. MunicipalEquipmentRepairFund

I.PURPOSE

The Village of Glenview, Illinois, has established a Maintenance Equipment Repair Fund(MERF)toaccountfortheexpendituresrelatedtothePublicWorksDepartmentwhomaintainand repair all Village and agreed upon outside agency vehicles, Village equipment, and theVillageownedfuelsystem.MERFalsoaccountsforfuelforallVillageandcontractedoutsideagency vehicles. TheBoard reviewed theMERFpolicy onAugust 18, 2009and approved afundbalancegoaltonettozerocashbalanceonanannualbasis.

II.MERFREPAIRSCHEDULE

Public Works Department is responsible for the development and implementation of amaintenanceandrepairscheduleforVillagevehiclesandequipment.Thisfundalsoaccountsforunanticipatedrepairs.

III.MERFREVENUESANDEXPENSES

The Maintenance Equipment Repair Fund is funded through Charges for Services for themaintenance and repair of vehicles and equipment. The PublicWorks Department reportsactivityandAdministrativeServices invoicesparticipatingdepartmentsandoutsideagenciesonamonthlybasisforservicesrendered.Thesechargesincludeanadministrationfee,labor,fuel,parts,andoutsiderepairs.Theservicechargesareintendedtocovertheoperatingcostsandarereviewedannually.

RevenueswillbecollectedintheMERFFundfromthesaleofscrapmaterials,interestincome,andChargesforServices.

III.FUNDBALANCE

The Charges for Services collected through MERF are intended to cover the operatingexpenses. MERFfundbalanceistobemanagedtoazerobalance. Budgetedoperatingcostsareanestimateandactualresultsmayfluctuateslightlyfromthebudgetonanannualbasis.Administrative Serviceswill analyzeMERFannually and a recommendationwill bemade totheBoardofTrusteesshouldthetargetedfundbalancefallshortorexceedthefundbalancepolicylevel.

Section:PermanentFund

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XI. PermanentFundI. PURPOSE

PursuanttotheSeptember3,1996Business/OperationalPlanpreparedbyDeloitte&Touchefor the Glenview Naval Air Station redevelopment project (now known as “The Glen” andhereinafter referred to as the “Project”), the Village of Glenview, Illinois, established aPermanent Fund (the “Fund”) to receive a master developer fee defined as 20% of theproceedsoflandsoldwithintheProject.AninterimpolicywasestablishedbyResolution02‐40totemporarilyusetheFundBalanceasanintergovernmentalloantotheProjecttoenhancecash flow, reduce overall Project risk andminimize General Obligation bond requirements.BasedonthesuccessandstabilizationoftheProject,itwaspossibletousesomeoftheFundrevenues for eligible uses and a formal policy regarding use of the Fund’s assets wasestablishedbyResolutionNo.05‐16onMarch15,2005.II.PERMANENTFUNDADVANCESPermanentfundassetsshallnotbeutilizedtofundoperatingexpendituresinanyfundexceptin the event that cash reserves are exhausted due to emergency expenditures. Operatingexpendituresincluderegularlyoccurringoperationsthatprovidebasicgovernmentalservicesincluding,butnotlimitedto,personnelcosts,supplies,utilities,materials,andfuel.TheuseofPermanentFundassetsasaresultoftheexhaustionofcashreservesshallbeforaperiodnottoexceedoneyearandshallbeusedsolelytoaddresscashflowshortfallsbetweenoperatingexpenditures and revenue collection. Should Permanent Fund assets be utilized, theborrowing fund will repay the Permanent Fund the amount at a reasonable and currentinterestearningsrate.III.ELIGIBLEUSESExceptforPermanentFundAdvancesnotedabove,itistheintentoftheVillagetolimittheuseofPermanentFundassetstocapitalexpendituresthroughouttheVillage(outsideofTheGlen)and economic development initiatives. Capital expenditures include expenditures for realpropertyorimprovementstorealpropertyincluding,butnotlimitedto,constructionof,andmajoralterationstothefollowing:

1) TransportationProjectsa) StreetImprovementsb) SidewalksandBikewaysc) StreetLightingd) Bridgese) RailwayCrossingsf) TrafficSignalsandIntersectionsg) Landscaping

Section:PermanentFund

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2) LandAcquisition3) StormSewerProjects

StormWaterManagementProjectsDetentionProjects

4) SanitarySewerProjects5) Village‐ownedBuildings,StructuresandPhysicalFacilities

a) FixedEquipmentb) Landscaping

EconomicdevelopmentinitiativesincludethosethatmeetVillagefinancialandstrategicgoals,provide for reinvestment in the community, and establish andmaintain long term revenuestreams.IV.ASSETUSEReview available assets and if there are any assets available, they are considered for anyeligibleusesduringtheannualbudgetprocess.

Section:New

Property–PropertyTaxLevyPolicy

30


XII. NewProperty–PropertyTaxLevyPolicyI.PURPOSETheintentofthisPolicyistoprovideguidancetostaffindraftingtheproposedPropertyTaxLevy for the annual budget and to acknowledge and affirm that only the Village Board'sconsideration and passage of the annual Property Tax Levy will authorize extension andcollectionoftaxesonrealpropertywithintheVillageofGlenview.II.POLICYEach year the Cook County Clerk’s Office identifies the portion of the Village’s EqualizedAssessed Valuation “EAV” attributable towhat is commonly referred to as “New Property.”This includes additions or improvements to existing property, annexations, disconnects,recovered tax increment value, and expired incentives. These amounts are reported on theVillage’s PTELL – 20XX New Property, Annexed Property, Disconnected Property,RecoveredTax IncrementReport. For simplicity this policywill refer to this as theNewPropertyReport. The totalofallcategorieson theNewPropertyReport isdisplayedontheVillage’s Agency Tax Rate Report, also reported by the Cook County Clerk’s Office. TheAgencyTaxRateReportalsoincludestheAgencyOverallEAVfortheVillage.Each year staff will use the reports from the Cook County Clerk’s Office to determine thepercentagechangeinEAVthatoccurredasaresultofthis“NewProperty”.Staffwillsubtractthe “New Property” from the Agency Overall EAV to determine the current EAV amountassociatedwiththepropertiesthatwereincludedinlastyear’sAgencyTaxRateReport.Thisrepresents the “CurrentEAVofOldProperty.” Dividing the “NewProperty”by the “CurrentEAV of Old Property” results in the percentage change in EAV attributable to the “NewProperty.”Staffwillthenadjusttheprioryear’sPropertyTaxLevybythepercentagechangecalculatedabovetoconstructtheannualPropertyTaxLevyamountforthefollowingyear’sbudget.Thischange would represent the increase or decrease to the prior year’s levy that could becapturedbytheVillageinthecurrentyearwithoutimpactingthetaxburdenforthepopulationofpropertiesthatmadeuptheprioryear’sEAV.ThisPolicyvoidsandreplacestheAnnexed(Disconnected)PropertyTaxPolicy.

Section:Purchasing

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XIII. Purchasing

A. ProcurementPolicy I.PURPOSEANDGOALSThisPolicyestablishesa centralizedpurchasing system for theVillageofGlenview tovest authority for establishing rules governing purchasing by the Village, promotepublic confidence in the integrity and transparency of the procedures followed toprocure the goods and services required by the Village, ensure fair and equitabletreatment of all people who participate in the purchasing system and maximizeeconomy in purchasing activities and, to the fullest extent possible, the purchasingvalueofVillagefunds.

II.POLICYTheProcurementPolicyshallhavetheforceandeffectofmunicipallocallawasiffullystated in the Village’s Code upon approval and adoption by the Village of GlenviewBoard of Trustees. Additionally, the terms andprovisions of theProcurementPolicyshallbedeemedbyoperationof lawtobeapartof the termsandconditionsofeachprocurement,purchaseorderandcontractinvolvingtheVillageasaparty,excepttotheextentthatanauthorizedofficialhasexpresslyprovidedforawrittenexceptiontooneormoreoftherequirementsprovidedforintheProcurementPolicywithrespecttoaparticularprocurement,purchaseorderorcontract.All purchases are required to follow theProcurementPolicyand theProcedures&Acceptable Use Guidelines adopted by the Board of Trustees April 12, 2013(Resolution13‐073),unlessotherwisegovernedunderaspecificpolicy.No itemorserviceshouldbeordered,receivedorpaid forwithoutaPurchaseOrder,BlanketPurchaseOrder,EmergencyPurchaseOrderorCreditCard.CATEGORYONE:PURCHASESUPTO$1,000.00Purchasesinthiscategoryrequireoneverbalquote.CATEGORYTWO:PURCHASESOF$1,000.01TO$4,999.99Purchasesinthiscategoryrequiremultiplequotes.CATEGORYTHREE:PURCHASESOF$5,000.00TO$19,999.99Purchases in this category require written quotes. Written quote packages shall besubmittedtothePurchasingManagerforcompliancereviewpriortoissuingthePO.CATEGORYFOUR:PURCHASESOVER$20,000.00RequiresaformalsolicitationthroughthePurchasingDivision.

Section:Purchasing

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CATEGORYFIVE:PURCHASESOF$19,999.99TO$30,000.00RequiresaformalsolicitationthroughthePurchasingDivision.The Village Board of Trustees, Village Manager or his/her designee may waive theformalbiddingprocesswhenitisdeemedadvantageoustotheVillage.ApprovalAuthorityA. ForpurchasesandcontractsuptoCATEGORYTWOthathavebeenadoptedinthe

currentorpriorbudget,theapprovalauthorityistheDepartmentHead.

B. For purchases and contracts up to CATEGORIES THREE, FOUR, and FIVE, theapprovalauthorityistheVillageManagerandthePurchasingManager.

C. ForpurchasesandcontractsinexcessofCATEGORYFIVE,theapprovalauthorityistheVillageBoardofTrustees.

ExclusionsThefollowingpurchasesareexcludedfromthecompetitiverequirements:A. Agreements between the Village Board and non‐profit organizations or

governmental entities including the procurement, transfer, sale or exchange ofgoodsand/orservices.

B. Procurement of dues and memberships in trade or professional organizations;subscriptions for periodicals; advertisements; postage; used equipment; abstractsof titles for real property; title insurance for real property; real property; water,sewer,andelectricalutilityservices;copyrightedmaterials;patentedmaterials;artand artistic services; employment agreements;medical services; service requiredby proprietary ownership such as CSX Railroad carrier, original equipmentmanufacturers (OEM) and fees and costs of job‐related travel, seminars, tuition,registrationandtraining.

C. PurchasesfromStateofILaswellasothercontractsawardedbyanylocal,state,ornational government agency, cooperative purchasing organizations or purchasingassociationsthathavebeencompetitivelybid.

B. CreditCardPolicyI.PURPOSE,GOALS,ANDPOLICYVillage‐issuedcreditcards (“CreditCards”)are issued todesignatedemployeesof theVillage to support specific and limited types of Village purchasing. Credit Cards areusedasasupplementtootheracceptablemethodsofprocurement,andshouldonlybeusedwhenotherapprovedprocurementmethodsarenotavailable.

Section:Purchasing

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TheVillagestronglyencouragestheuseofotherapprovedmethodsofprocurementwhenpossible.AllpurchasesmadewithCreditCardsaresubjecttotherequirementsandrestrictionssetforthintheVillage’sProcurementPoliciesandProceduresandAcceptableUseGuidelines.PurchasesmadewithCreditCardsaresubjecttopublicdisclosureundertheFreedomofInformationAct(the“FOIA”).

C. PettyCashPolicyI.PURPOSE,GOALS,ANDPOLICYPettyCashisusedtomakesmallpurchasesasasupplementtoothermethodsofpurchasing.PettyCashshouldonlybeusedforsmallincidentalpurchasesforwhichthereisanimmediateneed.PettyCashshouldnotbeusedtoreimburseexpensesthatcanbeprocessedthroughotherapprovedpaymentmethods.TheVillagestronglyencouragestheuseofotherapprovedmethodsofprocurementwhenpossible.AllpurchasesmadewithCreditCardsaresubjecttotherequirementsandrestrictionssetforthintheVillage’sProcurementPoliciesandProceduresandAcceptableUseGuidelines.PurchasesmadewithCreditCardsaresubjecttopublicdisclosureundertheFreedomofInformationAct(the“FOIA”).

D. PreIssuedChecksI.PURPOSEANDGOALSPOLICYPreissuedchecksarechecks issuedbetweennormalaccountspayablecycleswhenanemergency or other extenuating circumstance, as determined by the Director ofAdministrative Services or the Director of Finance, makes it impractical orunreasonable toprocess thepayment followingnormalpaymentmethods. Preissuedchecksarelaborintensiveandtimeconsumingtoissue,therefore,theiruseasamethodofpaymentshallberestrictedtouniqueorspecialcircumstances.Inmostcases,traveladvances and seminar registrations are not considered special circumstances andshouldberequestedthroughthenormalaccountspayablecycle.II.POLICYTheAdministrative ServicesDepartmentwill not preissue checks in instanceswherereasonable means could have been taken to process the payment following normalpaymentmethods.Allrequestsforpreissuedchecksmustincludethefollowing:

Section:Purchasing

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A completed request formwhich includes the vendor’s name and address, thebudgetaccountnumbertobecharged,descriptionofthepurchase/service,andanexplanationastotheneedforthespecialrequest.

Theformshallincludethesignaturesoftheemployeerequestingthepreissued

checkandtheapplicableDepartmentHead.

ThecompletedformshallbesubmittedtotheDirectorofFinanceforapproval.

The Administrative Services Department will process all approved preissuedchecksonaweeklybasis.

Section:SpecialServiceAreas–ProjectCostandInterestRateAmendm

ent

35


XIV. SpecialServiceAreas–ProjectCostandInterestRateAmendmentI.PURPOSETheVillageadoptedaStormwaterManagementPolicyStatement forUnseweredAreasofthe Village datedOctober 1, 2002 on October 15, 2002 (Resolution 02‐51), amended forspecifics related to SWAMP improvements on November 5, 2002 (Resolution 02‐55), andamendedestablishing fundaccountingpolicyonFebruary1,2005(Resolution05‐05). Mostrecently,itwasamendedMay2,2006(Resolution06‐84)tooutlinetheprocedureusedwhencalculating estimated project costs and interest rates for use in Special Service Area (SSA)constructionprojects.

II.POLICYTheVillageofGlenviewpolicyconcerningestimatedprojectcostsshallbetotakethefinalEngineer'sestimateandadda25%contingencyfactortothatamount.Thatfigureshallbeusedforthepurposesofestimatingnot‐to‐exceedprojectcostsintheordinanceestablishingtheSpecialServiceArea.ForthepurposeofestimatingtheinterestratefortheSpecialServiceArea,itshallbetheVillage’spolicytotakethecurrentinterestratefora20yearnoteforthethencurrentbondratingoftheVillage,asestablishedbytheBondBuyerIndex,andadd2percentagepointstoestablishthenot‐to‐exceedinterestratetobeusedintheordinanceestablishingtheSpecialServiceArea.

Section:UnclaimedProperty

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XV. UnclaimedProperty I.PURPOSETheVillageofGlenview(the“Village”)hasdevelopedthisUnclaimedPropertyPolicytoensurevendorsreceivetheirpaymentsandtominimizeremittancestothestate.II.STATUTORYREQUIREMENTSThe Village of Glenview (the “Village”) has established this Unclaimed Property Policy toensurecompliancewiththeIllinoisUniformDispositionofUnclaimedPropertyAct‐765ILCS1025/1‐30‐(the“Act”).TheActstates thatgovernmentagenciesarerequiredtosendto theStateofIllinoisthecashfromanycheckthatisoutstandingforgreaterthansevenyears.Theseoutstanding checks are presumed to be abandoned. This policywill attempt tomitigate thepossibility of the Village having to send cash to the State for any unclaimed property andclearlystatehowtheVillagewillremainincompliancewiththeAct.EachyeartheStateofIllinoissendsanAnnualReportofUnclaimedPropertytotheVillageforfiling. The Village will submit a completed form, including a check for the amount of theunclaimedpropertybytheestablishedannualdeadline.III.POLICYGUIDELINESThe Village issues checks for various activities, services, and products throughout the year.AftertheVillagereceivestheseservicesandproducts,theVillageislegallyboundtosatisfyitsobligations. If the Village issues a check, it no longer has rights to the cash. If a check isoutstanding at the end of the month, it is included as a reconciling item during the bankreconciliation procedure. The Village will also send out notifications according to currentproceduresinitsbestefforttodeliverthechecktothepayee.If a check remains outstanding formore than the current contracted bank policy (generally180dayswithmostbankinginstitutions),thecheckbecomesvoidandcannolongerbecashedby the payee. In order to avoid having to reissue any checks, the Administrative ServicesDepartmenthasdevelopedprocedurestonotifypayeesofanunclaimedcheckandproceduresto reissue checks. The Administrative Services Department had also developed finalnotification procedures for outstanding checks. Any unclaimed checks after the currentcontracted banking term will be void and the payee would need to follow the establishedprocedurestoreceiveareplacementcheck.

Section:AppendixA:BoardPolicyAction

37


XVI. AppendixA:BoardPolicyAction

Policy Board Consideration/Adoption Notes

1. Budget February 1, 2005 July 16, 2009 Board Workshop

Revenue estimation and expense detailWritten policy to adopt and adhere to a budget (65 ILCS 5/8‐2‐9.1 through 9.11)

2. Capital Projects

Budgeting

February 1, 2005 June 17, 2008

Established 5‐Year PlanAuthorize project‐length capital budgeting

3. Cost Allocation July 16, 2009 Board Workshop Budget across all funds and expense as incurred

4. Capital Equipment

Replacement Fund

(“CERF”)

March 1, 2005; July 16, 2009 Board Workshop August 18, 2009 Board Workshop 2012 Budget Workshop

Fund accounting established Considered smoothing methods 50% Accumulated Reserves & Rolling 5‐Year Average 40% Accumulated Reserves& Rolling 5‐Year Average

5. Debt February 1, 2005 May 22, 2012

Issue for capital infrastructure requirementsBond Record Keeping and Compliance Reporting

6. Facilities Repair and

Replacement Fund

2006 Created from CERF Transfer; no ongoing revenue source

7. Insurance/Risk Fund February 1, 2005 October 6, 2009 Oct 5, 2010 Workshop March 10, 2011 Workshop October 18, 2011 Executive Session

Reserve amount adequate to fund predictable lossesCombined Funds 55% Confidence Level Claim Payment Budget; Unpaid Claim Reserve at 75% Level Reviewed actuarial methods to estimate claims and reserves 55% Confidence Level Claim Payment Budget; Unpaid Claim Reserve at 55% Level

8. Investment February 1, 2005 April 16, 2009 & May 19, 2009

Minimize credit and interest rate risk Defined investment types and designated officials; eliminated derivatives as an investment option

9. Municipal Equipment

Repair Fund (“MERF”)

July 16, 2009 Board WorkshopAugust 18, 2009 Board Workshop

Fund accounting established Transferred Assets to CERF

10. Permanent Fund March 15, 2005 (insert date) December 8, 2009 & December 13, 2010 April 16, 2013

Fund accounting established Update interest provision to Illinois Funds rate Library 2009A tax abatements Amend for economic development use

11. Property Tax February 5, 2008 July 17, 2012 June 19, 2012

Annexed Property Calculation GuidelineUpdated Annexed Property Calculation Document EAV, Loss & Cost, + projected growth

12. Purchasing March 15, 2005 December 9, 2008 April 16, 2013

Purchasing Authority Level of $500 & under created

Purchasing Manual adopted with Manager approval authority at $30,000

13. Reserves February 1, 2005

Corporate Fund Reserves 33‐40% of Total Expenditures; Utility funds 60‐day operating

Section:

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July 16, 2009 Board Workshop FY 2012 Implementation

expenditures excluding capital and debtCorporate Fund Reserves 30‐40% of Total Expenditures GASB 54 update

14. Special Service Areas February 1, 2005, October 15, 2002, November 5, 2002, and May 2, 2006

Fund accounting established; Contribution of public funds toward drainage improvements in unsewered areas; Update to eliminated prepayment option; Established upper limit project costs and interest rates

15. Unclaimed Property July 21, 2009 Established annual reporting

Section:AppendixB:ExhibitAtoCapitalAssetsPolicy(InDevelopment)

39


XVII. AppendixB:ExhibitAtoCapitalAssetsPolicy(InDevelopment) Hold Section: Table in development.

Section:AppendixC:InvestmentPolicyGlossary

40


XVIII. AppendixC:InvestmentPolicyGlossary AGENCIES: Informalname that refers to securities issuedby theUnitedStates governmentandU.S.governmentsponsoredinstrumentalities.ASKED: The trading price proposed by the prospective seller of securities. Also called theofferorofferedprice.BANKERS'ACCEPTANCE (BA): A short‐term financial instrument that is theunconditionalobligationoftheacceptingbank.BASISPOINT(BP): Aunitofmeasurementforinterestratesoryieldsthatareexpressedinpercentages.(Onehundredbasispointsequal1percent.)BID:Thetradingpriceacceptabletoaprospectivebuyerofsecurities.BONDEQUIVALENTYIELD(BEY):Anannualyield,expressedasapercentage,describingthereturnprovidedtobondholders.TheBEYisawaytocompareyieldsavailablefromdiscountsecuritiessuchasTreasurybillsandBAswithyieldsavailablefromcouponsecurities.BROKER:Apartywhobringsbuyersandsellerstogether.Brokersdonottakeownershipofthepropertybeingtraded.Theyarecompensatedbycommissions.Theyarenotthesameasdealers;however,thesameindividualsandfirmsthatactasbrokersinsometransactionsmayactasdealersinothertransactions.BROKEREDANDNEGOTIABLECERTIFICATESOFDEPOSIT: Short‐term (2 to 52weeks)largedenomination($100,000minimum).CertificateofDepositthatisissuedatadiscountonitsparvalue,oratafixedinterestratepayableatmaturityandarefreelytradedinsecondarymarkets.CERTIFICATE OF DEPOSIT (CD): A deposit of funds, in a bank or savings and loanassociation,foraspecifictermthatearnsinterestataspecifiedrateorrateformula.CDsmaybesecuredorunsecured,may be in negotiable or nonnegotiable form andmay be issued ineitherphysicalorbookentryform.COLLATERAL:Securities,evidenceofdepositorotherpropertywhichaborrowerpledgestosecurerepaymentofaloan. Alsoreferstosecuritiespledgedbyabanktosecuredepositsofpublicmonies.COMMERCIALPAPER(CP):Unsecured,short‐termpromissorynotesissuedbycorporationsforspecificamountsandwithspecificmaturitydates.


41


COMPREHENSIVEANNUALFINANCIALREPORT(CAFR): TheofficialannualreportfortheVillageofGlenview. It includes five combinedstatementsandbasic financial statements foreach individual fundandaccountgroupprepared inconformitywithGAAP. It also includessupporting schedules necessary to demonstrate compliance with finance‐related legal andcontractualprovisions,extensiveintroductorymaterial,andadetailedStatisticalSection.COUPON:(a)Theannualrateofinterestthatabond'sissuerpromisestopaythebondholderon the bond's face value. (b) A certificate attached to a bond evidencing interest due on apaymentdate.DEALER: A firm or individual who buys and sells for their own account. Dealers haveownership between a purchase from one party and a sale to another party. Dealers arecompensatedbythespreadbetweenthepricetheypayandthepricetheyreceive.DEBENTURE:Abondsecuredonlybythegeneralcreditoftheissuer.DELIVERYVERSUSPAYMENT(DVP):Thesimultaneousexchangeofsecuritiesandcash.Thesafestmethodof settling either thepurchaseor saleof a security. In aDVP settlement, thefunds are wired from the buyer's account and the security is delivered from the seller'saccountinsimultaneousindependentwires.DISCOUNT:Theamountbywhichthepriceforasecurityislessthanitspar.DISCOUNT SECURITIES: Securities that do not pay periodic interest. Investors earn thedifferencebetweenthediscountissuepriceandthefullfacevaluepaidatmaturity.Treasurybills,bankers’acceptancesandzerocouponbondsarediscountsecurities.DIVERSIFICATION: Dividing investment funds among a variety of securities offeringindependentreturns.FEDERALCREDITAGENCIES:AgenciesoftheFederalGovernmentsetuptosupplycredittovarious classes of institutions and individuals, e.g., S & L's, small business firms, students,farmers,farmcooperatives,andexporters.FEDERALDEPOSITOF INSURANCECORPORATION (FDIC): A federal agency that insuresbankdeposits,currentlyupto$100,000perdeposit.FEDERALFUNDSRATE:Therateforwhichovernightfederalfundsaretraded.FEDERALHOMELOANBANKS(FHLB):Theinstitutionsthatregulateandlendtosavingsandloanassociations. TheFederalHomeLoanBanksplayaroleanalogoustothatplayedbytheFederalReserveBanksvis‐à‐vismembercommercialbanks.


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FEDERAL NATIONAL MORTGAGE ASSOCIATION (FNMA or FANNIE MAE): FNMA is afederal corporation working under the auspices of the Department of Housing & UrbanDevelopment,HUD.ItisthelargestsingleproviderofresidentialmortgagefundsintheUnitedStates. FannieMae,as thecorporationiscalled, isaprivatestockholder‐ownedcorporation.The corporation's purchases include a variety of adjustablemortgages and second loans inadditiontofixed‐ratemortgages.FNMAassumesandguaranteesthatallsecurityholderswillreceivetimelypaymentofprincipalandinterest.FEDERALOPENMARKETCOMMITTEE(FOMC): ConsistsofsevenmembersoftheFederalReserveBoardandfiveofthetwelveFederalReserveBankPresidents. ThePresidentoftheNewYorkFederalReserveBankisapermanentmemberwhiletheotherPresidentsserveonarotationbasis.TheCommitteeperiodicallymeetstosetFederalReserveguidelinesregardingpurchasesandsalesofGovernmentSecuritiesintheopenmarketasameansofinfluencingthevolumeofbankcreditandmoney.FEDERALRESERVESYSTEM:ThecentralbankoftheUnitedStatescreatedbyCongressandconsistingofasevenmemberBoardofGovernorsinWashington,D.C.,12regionalbanksandabout5,700commercialbanksthataremembersofthesystem.GOVERNMENTNATIONALMORTGAGEASSOCIATION (GNMAOR GINNIEMAE): GNMA,like FNMA, was chartered under the Federal National Mortgage Association Act of 1938.SecuritiesguaranteedbyGNMAand issuedbymortgagebankers,commercialbanks,savingsand loan associations and other institutions. Security holder is protected by full faith andcredit of the U.S. Government. Ginnie Mae securities are backed by FHA, VA or FMHMmortgages.ThetermpassthroughsisoftenusedtodescribeGinnieMaes.INTERNALCONTROLS: Internal controlsmust be designed to ensure that the assets of theVillage are protected from loss, theft or misuse. The internal control structure should bedesigned to provide reasonable assurance that these objectives are met. The concept ofreasonableassurancerecognizesthatthecostofacontrolshouldnotexceedthebenefitslikelyto be derived and the valuation of costs and benefits requires estimates and judgments bymanagement.Internalcontrolsshouldaddressthefollowingpoints: 1. Control of Collusion ‐ Collusion is a situation where two or more employees are

workinginconjunctiontodefraudtheiremployer.

2. Separationoftransactionauthorityfromaccountingandrecordkeeping‐Byseparatingthe person who authorizes or performs the transaction from the people who record orotherwiseaccountforthetransaction,aseparationofdutiesisachieved.

3. Custodial Safekeeping ‐ Securities purchased from any bank or dealer includingappropriatecollateral(asdefinedbystate law)shallbeplacedwithan independentthirdpartyforcustodialsafekeeping.

4. Avoidance of Physical Delivery Securities ‐ Book‐entry securities aremuch easier totransferandaccountforsinceactualdeliveryofadocumentnevertakesplace. Delivered


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securitiesmustbeproperlysafeguardedagainstlossordestruction.Thepotentialforfraudandlossincreaseswithphysicallydeliveredsecurities.

5. Cleardelegationofauthoritytosubordinatestaffmembers‐Subordinatestaffmembersmusthaveaclearunderstandingoftheirauthorityandresponsibilitiestoavoid improperactions. Cleardelegationofauthorityalsopreserves the internalcontrolstructure that iscontingentonthevariousstaffpositionsandtheirrespectiveresponsibilities.

6. Writtenconfirmationsortelephonetransactionsforinvestmentsandwiretransactions‐Due to thepotential forerrorand improprietiesarising fromtelephone transactions,alltelephonetransactionsshouldbesupportedbywrittencommunicationsandapprovedbytheappropriateperson.Writtencommunicationsmaybeviafaxifonletterheadandifthesafekeepinginstitutionhasalistofauthorizedsignatures.

7. Developmentofawiretransferagreementwiththeleadbankorthirdpartycustodian‐The designated official should ensure that an agreement will be entered into and willaddress the following points: controls; security provisions, and responsibilities of eachpartymakingandreceivingwiretransfers.

LIQUIDITY: A liquid asset is one that can be readily converted to cash through sale in anactivesecondarymarket.LOCAL GOVERNMENT INVESTMENT POOL (LGIP): Pools through which governmentalentitiesmayinvestshorttermcash.ExamplesofLGIP'saretheIllinoisFunds,administeredbytheIllinoisStateTreasurerandtheIllinoisMetropolitanInvestmentFund.MARKETVALUE:Thepriceatwhichasecuritycouldpresumablybepurchasedorsold.MARKTOMARKET: The process of restating the carrying value of an asset or liability toequalitscurrentmarketvalue.MASTER REPURCHASE AGREEMENT: A written contract covering all future transactionsbetweenparties.Theagreementestablisheseachparty’srightinthetransaction.RepurchaseAgreements(REPO’s)areaformofshort‐termborrowingfordealersingovernmentsecurities.Thedealersellsthegovernmentsecuritiestoinvestors,usuallyonanovernightbasis,andthenbuys them back the following day. For the party selling the security (and agreeing torepurchase it in the future), it is a repo; for the party on the other end of the transaction(buyingthesecurityandagreeingtosellinthefuture),itisareverserepurchaseagreement.Amasteragreementwilloftenspecify,amongotherthings,therighttoliquidatetheunderlyingsecuritiesintheeventofdefault.MATURITY:Thedateuponwhichtheprincipalorstatedvalueofaninvestmentbecomesdueandpayable.MONEYMARKET: The aggregation of buyers and sellers actively trading money marketinstruments.


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OFFER OF OFFERED PRICE: The trading price proposed by the prospective seller ofsecurities(alsocalledtheaskedoraskingprice).OPEN MARKET OPERATIONS: Purchases and sales of government and certain othersecuritiesintheopenmarketbytheNewYorkFederalReserveBankasdirectedbytheFOMCin order to influence the volume of money and credit in the economy. Purchases injectreserves into the bank system and stimulate growth of money and credit; sales have theoppositeeffect. OpenmarketoperationsaretheFederalReserve'smostimportantandmostflexiblemonetarypolicytool.PORTFOLIO:Collectionoffinancialassetsbelongingtoasingleowner.PREMIUM:Theamountbywhichthepriceforasecurityisgreaterthanitsparamount.PRIMARYDEALER: A group of government securities dealers that submit daily reports ofmarketactivityandpositionsandmonthlyfinancialstatementstotheFederalReserveBankofNewYork and are subject to its informal oversight. Primary dealers include Securities andExchangeCommission(SEC)‐registeredsecuritiesbroker‐dealers,banks,andafewunrelatedfirms.PRUDENTPERSONRULE: An investment standard. In somestates the lawrequires thatafiduciary,suchasatrustee,mayinvestmoneyonlyinalistofsecuritiesselectedbythestate‐theso‐called legal list. Inother states the trusteemay invest ina security if it isonewhichwould be bought by a prudent person of discretion and intelligence who is seeking areasonableincomeandpreservationofcapital.QUALIFIEDPUBLICDEPOSITORIES:Afinancialinstitutionwhichdoesnotclaimexemptionfromthepaymentofanysalesorcompensatinguseoradvaloremtaxesunderthelawsofthisstate,whichhassegregatedforthebenefitofthecommissioneligiblecollateralhavingavalueof not less than its maximum liability andwhich has been approved by the Public DepositProtectionCommissiontoholdpublicdeposits.RATEOFRETURN: The yield obtainable on a security based on its purchase price or itscurrentmarketprice. Thismaybetheamortizedyieldtomaturityonabondorthecurrentincomereturn.REINVESTMENTRISK:Theriskthatallorpartoftheprincipalmaybereceivedwheninterestratesarelowerthanwhenthesecuritywasoriginallypurchased,sothattheprincipalmustbereinvestedatalowerratethantherateoriginallyreceivedbytheinvestor.REPURCHASEAGREEMENT(RPORREPO):SeeMasterRepurchaseAgreement.


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SAFEKEEPING:Aservicerenderedbybankswherebysecuritiesandvaluablesofalltypesanddescriptionsareheldbythebank.SECRULE15C3‐1:Seeuniformnetcapitalrule.SECONDARYMARKET: Marketsforthepurchaseandsaleofanypreviouslyissuedfinancialinstrument.SECURITIES&EXCHANGECOMMISSION (SEC): The federal agencywith responsibility forregulatingfinancialexchangesforcashinstruments.SPREAD OVER TREASURIES: The difference between the bond equivalent yield for anyinvestmentandthebondequivalentyieldforaTreasuryinvestmentwiththesamematurity.TREASURY BILLS (T‐BILLS): Short‐term obligations issued by the U.S. Treasury formaturities of one year or less. They do not pay interest but are issued on a discount basisinstead.TREASURYBONDS(T‐BONDS):Long‐termobligationsissuedbytheU.S.Treasurywithinitialmaturitiesofmorethantenyears.TREASURYNOTES (T‐NOTES): Medium‐term obligations issued by theU.S. Treasurywithinitialmaturitiesoffromonetotenyears.UNIFORM NET CAPITAL RULE: Securities and Exchange Commission requirement thatmemberfirmsaswellasnon‐memberbrokerdealersinsecuritiesmaintainamaximumratioof indebtedness to liquid capital of15 to1; also callednetcapital rule andnetcapital ratio.Indebtedness covers allmoney owed to a firm includingmargin loans and commitments topurchasesecurities,onereasonnewpublicissuesarespreadamongmembersofunderwritingsyndicate.Liquidcapitalincludescashandassetseasilyconvertedtocash.YIELD:Looselyreferstotheannualreturnonaninvestmentexpressedasapercentageonanannualbasis. For interest‐bearingsecurities, theyield isa functionof therate, thepurchaseprice, the income that can be earned from the reinvestment of income received prior tomaturity,callorsale.Differentformulasormethodsareusedtocalculateyields.

Section:AppendixD:InvestmentPolicyAttachm

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XIX. AppendixD:InvestmentPolicyAttachments

Attachment # 1

VILLAGE OF GLENVIEW, ILLINOIS

CERTIFICATE OF COMPLIANCE THE UNDERSIGNED, BEING FIRST DULY SWORN ON OATH, DEPOSES AND STATES AS FOLLOWS: 1. That the undersigned has authority to make this certification on behalf of the bidder.

__________________________________________________________________ Name of Company 2. That the undersigned has read the contents of the Village’s Investment Policy which are

contained herein. Authorized Signature ________________________________

Type or Print Name

_________________________________ Title _______________________________________________ Instructions: This is to be completely filled out and executed by the chief officer or the individual authorized to submit the certification.


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Attachment # 2 GFOARecommendedPracticeCollateralizationofPublicDeposits(1984,1987,1993,2000,and2007)(CASH)Background. The safety of public funds should be the foremost objective in public fundmanagement.Collateralization of public deposits through the pledging of appropriate securities or otherinstruments (i.e. suretybondsor lettersofcredit)bydepositories isan importantsafeguardforsuchdeposits.Theamountofpledgedcollateralisdeterminedbyapublicentity’sdepositlevel.Somestateshaveestablishedprogramsforthepoolingofcollateralfordepositofpublicfunds.Federal law imposes certain limitations on collateral agreements between financialinstitutions and public entities in order to secure public entity deposits. Under certaincircumstances, the Federal Deposit Insurance Corporation (FDIC) may void a perfectedsecurity interest and leave the public depositor with only the right to share with othercreditorsintheproratadistributionoftheassetsofafailedinstitution.Recommendation. The Government Finance Officers Association (GFOA) recommends theuse of pledging requirements as protection for state or local government's deposits. GFOAencourages state and local governments to establish adequate and efficient administrativesystemstomaintainsuchpledgedcollateral, includingstateorlocallyadministeredcollateralpledgingorcollateralpools.Toaccomplishthesegoals,GFOArecommendsthefollowing:

1. Public entities should implement programs of prudent risk control. Such programscould includea formaldepositoryriskpolicy, creditanalysis,anduseof fullysecuredinvestments. In the absence of a state program for pooling collateral, public entitiesshould establish and implement collateralizationprocedures, includingprocedures tomonitor their collateral positions. Monitoring informs a public entity of undercollateralization, which may threaten the safety of an entity’s deposits, andovercollateralization,whichmayincreasethecostofbankingservices.

2. Stateandlocalgovernmentdepositorsshouldtakeallpossibleactionstocomplywith

federal requirements in order to ensure that their security interests in collateralpledged to secure deposits are enforceable against the receiver of a failed financialinstitution.Federallawprovidesthatadepositor’ssecurityagreement,whichtendstodiminishordefeattheinterestoftheFDICinanassetacquiredbyitasreceiverofaninsureddepository,shallnotbevalidagainsttheFDICunlesstheagreement:

isinwriting; wasapprovedbytheboardofdirectorsofthedepositoryoritsloancommittee;and has been, continuously, from the time of its execution, an official record of the

depositoryinstitution.


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3. Public entities should have all pledged collateral held at an independent third‐party

institution, and evidenced by awritten agreement in an effort to satisfy theUniformCommercial Code (UCC) requirement for control. The UCC states that the depositordoesnothaveaperfectedinterestinasecurityunlessthedepositorcontrolsit.Controlmeans that swaps, sales, and transfers cannot occur without the depositor’s writtenapproval.

Thevalueof thepledgedcollateral shouldbemarked tomarketmonthly,ormore

frequentlydependingonthevolatilityofthecollateralpledged.Ifstatestatutedoesnot dictate a minimum margin level for collateral based on deposit levels (e.g.,GeorgiaandMinnesotastatutesrequire110percent),themarginlevelsshouldbeatleast102percent,dependingontheliquidityandvolatilityofthecollateralpledged.Statestatutesalsogovernwhetherminimummargin levelsapply toprincipalonlyortoaccruedinterestaswell.Publicentitiesshouldreviewapplicablestatestatutesandconfirmcompliance.

Substitutionsofcollateralshouldmeettherequirementsofthecollateralagreement,

be approved inwritingprior to release, and the collateral should not be releaseduntilthereplacementcollateralhasbeenreceived.

4. The pledge of collateral should comply with the investment policy or state statute,whicheverismorerestrictive.

5. Public entities that use surety bonds in lieu of collateral should limit the insurers to

thoseofthehighestcreditqualityasdeterminedbyanationallyrecognizedinsuranceratingagency.

6. The public entity should review the terms and conditions of any letters of credit,includingthoseissuedbyafederalagencyorgovernmentsponsoredenterprise.

Note:AsaresultofthecourtcaseNorthArkansasMedicalCenterv.Barrett,963F.2d780(8thCir.1992),theFDICissuedapolicystatementinMarch1993indicatingthatitwouldnotseekto void a security interest of a federal, state, or local government entity solely because thesecurityagreementdidnotcomplywiththecontemporaneousexecutionrequirementsetforthinSection13(e)oftheFederalDepositInsuranceAct12U.S.C.1823(e).ThepolicystatementwasofficiallyenactedbySection317of theRiegleCommunityDevelopmentandRegulatoryImprovementActof1994(PublicLaw103‐325).References:• GFOASampleSecurityAgreement,1995.• GFOASampleCustodialTrustAgreement,1995.


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• An Introduction to Collateralizing Public Deposits for State and Local Governments, M.CorinneLarson,GFOA,2006.

• InvestingPublicFunds, SecondEdition,GirardMillerwithM.CorinneLarsonandW.PaulZorn,GFOA,1998.

ApprovedbytheGFOA’sExecutiveBoard,October23,2007.


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Attachment#3 GOVERNMENTFINANCEOFFICERSASSOCIATION RecommendedPractice Mark‐to‐MarketPracticesforStateandLocalGovernment InvestmentPortfoliosandInvestmentPools

Astheinvestmentportfoliosofstateandlocalgovernmentsaresubjectedtoincreasedscrutiny, it is essential that reporting standards be enhanced so that investors, governingbodiesandthepublicremaininformedofthecurrentmarketvalueoftheportfolio. Regulardisclosure of the value of a governmental entity's investments is an important step tofurthering taxpayer and market confidence in state and local government investmentpractices.

TheGovernmentFinanceOfficersAssociation(GFOA)recommendsthatstateandlocalgovernment officials responsible for investment portfolio reporting should determine themarketvalueofallsecuritiesintheportfolioonatleastaquarterlybasis.Thesevaluesshouldbeobtainedfromareputableandindependentsourceanddisclosedtothegoverningbodyorotheroversightbodyatleastquarterlyinawrittenreport.Itisrecommendedthatthereportinclude the market value, book value and unrealized gain or loss of the securities in theportfolio.

Many state and local government officials are allowed to invest in various state andlocal government investment pools available in their state or region. Pool administratorsshould,onatleastamonthlybasis,determinethemarketvalueofallsecuritiesinthepoolandreport this information to all pool participants on at least a quarterly basis. These valuesshould be obtained from a reputable and independent source. This information should beincludedinthereporttothegoverningbodypreparedonatleastaquarterlybasis.

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