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Regular City Council Meeting Monday, October 22, 2012 Page 12 Mayor Roe reiterated that the City's credit rating with agencies was the highest possible, at Triple A, allowing it to realize significant interest savings. Mayor Roe noted that the comments outlined in the letter from Springsted regarding this credit rating and the impression of rating agencies, provided evidence that the decisions being made by the City Council as stewards of the public's money were definitely paying off. Roll Call Ayes: Willmus; Johnson; Pust; McGehee; and Roe. Nays: None. c. Consider Temporary Amendment to the City's Investment Policy with Re- gard to Investing Bond Proceeds As detailed in the RCA dated October 22, 2012, Finance Director Miller re- viewed the City's current Investment Policy directing investment of available funds in accordance with the City's cash flow needs and MN State Statute. Mr. Miller noted that the current policy required all investments placed with fi- nancial institutions to carry a minimum credit rating of Double A, the second highest credit level classified by national rating agencies. However, in reaction to the economic downturn and high-profile failures across a number of indus- tries, Mr. Miller noted that credit rating agencies had made wholesale changes to their ratings system, and as a result, many prominent national institutions had their credit ratings dropped from Triple A or Double A to Single A, even though their underlying financial results had not changed. Some of those large institu- tions receiving the credit rating downgrade included JP Chase Morgan, Wells Fargo, U. S. Bank, Citigroup, and Morgan Stanley. Mr. Miller noted that the in- stitutions were still regarding as high quality and financially strong; while there remained very few Double A or higher rated institutions in today's financial in- dustry. As further detailed in the RCA, Mr. Miller suggested a temporary modification to the City's Investment Policy, based on today's financial climate, allowing for greater investment earnings specific to this bond issue and the 2011 issue, to be placed with institutions that have a rating of Single A or better and include col- lateral pledged by national or state chartered financial institutions. Mr. Miller advised that the proposed temporary provisions to the Investment Policy is in- cluded as part of the RCA (Attachment A) as recommended by staff. Finance Director Miller opined that these remained safe vehicles for the City, while allowing it the best opportunity for a short-term investment, rather than through a typical money market account and providing comparable, significant savings over the next three (3) years. Mr. Miller noted that there were currently no national banks in the repurchase market, with more interest from foreign banks, even though those banks retained a presence in the United States, their