Section 1. (a) The town council of every incorporated town shall have the power to:
(1) make investment of moneys in the General Fund and in
special funds of the town other than the sinking funds as
authorized by subsection (b);
(2) make investment of town sinking funds as authorized
by the act of July 12, 1972 (P.L.781, No.185), known as the
"Local Government Unit Debt Act"; and
(3) liquidate any such investment, in whole or in part,
by disposing of securities or withdrawing funds on deposit. Any action taken to make or to liquidate any investment shall be made by the officers designated by action of the town council.
(b) Council shall invest town funds consistent with sound business practice.
(c) Council shall provide for an investment program subject to restrictions contained in this act and in any other applicable statute and any rules and regulations adopted by council.
(d) Authorized types of investments for town funds shall be:
(1) United States Treasury bills.
(2) Short-term obligations of the United States
Government or its agencies or instrumentalities.
(3) Deposits in savings accounts or time deposits, other
than certificates of deposit, or share accounts of
institutions insured by the Federal Deposit Insurance
Corporation or the Federal Savings and Loan Insurance
Corporation or the National Credit Union Share Insurance Fund
or the Pennsylvania Deposit Insurance Corporation or the
Pennsylvania Savings Association Insurance Corporation to the
extent that such accounts are so insured, and, for any
amounts above the insured maximum, provided that approved
collateral as provided by law therefore shall be pledged by
the depository. ((3) amended Dec. 13, 1982, P.L.1151, No.264)
(4) Obligations of the United States of America or any
of its agencies or instrumentalities backed by the full faith
and credit of the United States of America, the Commonwealth
of Pennsylvania or any of its agencies or instrumentalities
backed by the full faith and credit of the Commonwealth, or
of any political subdivision of the Commonwealth of
Pennsylvania or any of its agencies or instrumentalities
backed by the full faith and credit of the political
subdivision.
(5) Shares of an investment company registered under the
Investment Company Act of 1940, whose shares are registered
under the Securities Act of 1933, provided that the only
investments of that company are in the authorized investments
for town funds listed in paragraphs (1) through (4).
(6) Certificates of deposit purchased from institutions
insured by the Federal Deposit Insurance Corporation or the
Federal Savings and Loan Insurance Corporation or the
National Credit Union Share Insurance Fund or the
Pennsylvania Deposit Insurance Corporation or the
Pennsylvania Savings Association Insurance Corporation to the
extent that such accounts are so insured. However, for any
amount above the insured maximum, such certificates of
deposit shall be collateralized by a pledge or assignment of
assets of the institution, and such collateral may include
loans (including interest in pools of loans) secured by first
mortgage liens on real property. Certificates of deposit
purchased from commercial banks shall be limited to an amount
equal to 20% of a bank's total capital and surplus.
Certificates of deposit purchased from savings and loan
associations or savings banks shall be limited to an amount
equal to 20% of an institution's assets minus liabilities.
((6) added Dec. 13, 1982, P.L.1151, No.264)
(7) Any investment authorized by 20 Pa.C.S. Ch. 73
(relating to fiduciaries investments) shall be an authorized
investment for any pension or retirement fund. ((7) added
Dec. 13, 1982, P.L.1151, No.264)
(e) In making investments of town funds, council shall have authority:
(1) To permit assets pledged as collateral under
subsection (d)(3), to be pooled in accordance with the act of
August 6, 1971 (P.L.281, No.72), relating to pledges of
assets to secure deposits of public funds.
(2) To combine moneys from more than one fund under town
control for the purchase of a single investment, provided
that each of the funds combined for the purpose shall be
accounted for separately in all respects and that the
earnings from the investment are separately and individually
computed and recorded, and credited to the accounts from
which the investment was purchased.
(3) To join with one or more other political
subdivisions and municipal authorities in accordance with the
act of July 12, 1972 (P.L.762, No.180), referred to as the
Intergovernmental Cooperation Law, in the purchase of a
single investment, provided that the requirements of
paragraph (2) on separate accounting of individual funds and
separate computation, recording and crediting of the earnings
therefrom are adhered to.