(5) Cash and Investments

State and local statutes place certain limitations on the nature of deposits and investments available to the City. Deposits (including demand deposits, term deposits and certificates of deposit) in any one financial institution may not exceed certain prescribed levels without collateralization by the financial institutions involved. Investments can also be made in securities issued by or unconditionally guaranteed by the U.S. government or agencies that have a maturity of less than one year from the date of purchase, repurchase agreements guaranteed by the U.S. government or agencies that have a maturity of less than one year from the date of purchase, repurchase agreements guaranteed by such securities with maturity dates of no more than 90 days from the date of purchase, and units in the Massachusetts Municipal Depository Trust ("MMDT").

In addition, the City's Pension Trust Fund has additional investment powers, most notably the ability to invest in common stocks, corporate bonds and other specified investments.

Deposits

The following summary presents the amount of City deposits which are fully insured or collateralized with securities held by the City or its agent in the City's name (Category 1), those deposits which are collateralized with securities held by the pledging financial institution's trust department or agent in the City's name (Category 2), and those deposits which are not collateralized (Category 3) at June 30, 1996.

 

Bank Balance

Total
Bank
Balance

Carrying
Amount

  
 

Category

 
 

1

2

3

  
Cash $

1,073,228

6,996,158

3,808,769

11,878,155

8,793,959

  
Total $

1,073,228

6,996,158

3,808,769

11,878,155

8,793,959

  

Investments

The City categorizes investments according to the level of risk assumed by the City. Category 1 includes investments that are insured, registered or held by the City's agent in the City's name. Category 2 includes uninsured and unregistered investments held by the counterparty's trust department or agent in the City's name. Category 3 includes uninsure and unregistered investments held by the counterparty, its trust department or its agent, but not in the City's name. Deferred compensation plan and pension plan funds are not categorized because they are managed investment pools.

  Carrying Amount    
  Category 1 Category 2 Category 3 Not
Categorized		 Total Market
Value
               
MMDT $

-

- 

- 

587,208

587,208

587,208
Deferred compensation plan  

-

-

-

2,085,971

2,085,971

2,085,971
Pension Trust fund  

-  

-   

-   

37,068,525

37,068,525

37,068,525
               
Totals $

-  

-   

-   

39,741,704

39,741,704

39,741,704

The composition of the City's investments fluctuates depending primarily on the timing of real estate tax receipts, proceeds from borrowings, collections of state and federal aid, and capital outlays throughout the year.