§ 2925 — Investments of funds by public authorities and public benefit corporations; general provisions

§ 2925. Investments of funds by public authorities and public benefit\ncorporations; general provisions. 1. Every public authority and every\npublic benefit corporation whether or not such corporation is otherwise\ngoverned by this chapter, (such entities to be hereinafter in this title\nreferred to as "corporation") shall by resolution adopt comprehensive\ninvestment guidelines which detail the corporation's operative policy\nand instructions to officers and staff regarding the investing,\nmonitoring and reporting of funds of the corporation. The investment\nguidelines approved by the corporation shall be annually reviewed and\napproved by the corporation.\n 2. Funds of the corporation, for purposes of this title, shall consist\nof all moneys and other financial resources available for investment by\nthe corporation on its own behalf or on behalf of any other entity or\nindividual.\n 3. The investment guidelines approved by the corporation shall\ninclude, but not be limited to the following:\n (a) A detailed list of the permitted investments of the corporation,\nwhich shall be consistent with the appropriate provisions of law\nrelating to the corporation and any additional requirements pursuant to\nany contract with bondholders and noteholders.\n (b) Procedures and provisions to fully secure the corporation's\nfinancial interest in investments; provided that the guidelines may\ninclude a description of the circumstances under which the corporation's\nfinancial interest in investments may be less than fully secured.\n (c) A requirement that the corporation shall enter into written\ncontracts pursuant to which investments are made, unless the corporation\nshall by resolution determine that a written contract is not practical\nor that there is not a regular business practice of written contracts\nwith respect to a specific investment or transaction, in which case the\ncorporation shall adopt procedures covering such investment or\ntransaction. Such contracts and procedures shall include provisions:\n (i) deemed necessary and sufficient to secure in a satisfactory manner\nthe corporation's financial interest in each investment;\n (ii) covering the use, type and amount of collateral or insurance for\neach investment;\n (iii) establishing a method for valuation of collateral, and\nprocedures for monitoring the valuation of such collateral on a regular\nbasis;\n (iv) for the monitoring, control, deposit and retention of investments\nand collateral which shall include, in the case of a repurchase\nagreement, a requirement that the obligations purchased be physically\ndelivered for retention to the corporation or its agent (which shall not\nbe an agent of the party with whom the corporation enters into such\nrepurchase agreement), unless such obligations are issued in book-entry\nform, in which case the corporation shall take such other action as may\nbe necessary to obtain title to or a perfected security interest in such\nobligations.\n (d) Standards for the diversification of investments, including\ndiversification with respect to types of investments and firms with\nwhich the corporation transacts business.\n (e) Standards for the qualification of investment bankers, brokers,\nagents, dealers and other investment advisers and agents which transact\nbusiness with the corporation, such as criteria covering quality,\nreliability, experience, capitalization, size and any other factors\nthat, in the judgment of the corporation, make a firm qualified to\ntransact business with the corporation.\n (f) Provisions for reporting on the investments of the corporation,\nincluding provisions for an annual independent audit of all investments,\nthe results of which shall be available to the board at the time the\nannual review and approval of investment guidelines is conducted by the\ncorporation.\n 4. Each corporation shall have the power from time to time to amend\nsuch investment guidelines in accordance with the provisions of this\ntitle.\n 5. Each corporation shall direct the preparation and filing with the\nboard of quarterly reports, or reports covering such other period as may\nbe approved by the corporation, from a designated officer or employee\nregarding any new investments, the inventory of existing investments,\nand the selection of investment bankers, brokers, agents, dealers or\nauditors.\n 6. Each corporation shall annually prepare and approve an investment\nreport which shall include the investment guidelines, as specified in\nsubdivision three of this section, amendments to such guidelines since\nthe last investment report, an explanation of the investment guidelines\nand amendments, the results of the annual independent audit, the\ninvestment income record of the corporation and a list of the total\nfees, commissions or other charges paid to each investment banker,\nbroker, agent, dealer and adviser rendering investment associated\nservices to the corporation since the last investment report. Such\ninvestment report may be a part of any other annual report that the\ncorporation is required to make.\n 7. (a) Each corporation, a majority of the members of which consist of\npersons appointed by the governor or who serve as members by virtue of\nholding a civil office of the state, or a combination thereof, shall\nannually submit its investment report to the division of the budget and\ncopies thereof to the department of audit and control, the senate\nfinance committee and the assembly ways and means committee.\n (b) Each corporation, other than a corporation included under\nparagraph (a) of this subdivision, shall annually submit its investment\nreport to the chief executive officer and chief fiscal officer of each\nmunicipality for the benefit of which it was created and to the\ndepartment of audit and control.\n (c) Each corporation shall make available to the public copies of its\ninvestment report upon reasonable request therefor.\n 8. Nothing contained in this section shall be deemed to alter, affect\nthe validity of, modify the terms of or impair any contract, agreement\nor investment of funds made or entered into in violation of, or without\ncompliance with, the provisions of this title.\n