ARTICLE III FISCAL AFFAIRS

Policy 3.01 Bank Accounts

Policy 3.01 Bank Accounts

1. POLICY
The purpose of this Policy is to ensure that The City University of New York has appropriate procedures, practices and controls in place to safeguard and manage the University’s cash assets and comply with applicable law and best practices so as the minimize the risk of financial loss. This Policy articulates the requirements for opening, closing, updating and maintaining college bank accounts (see Definitions, below). All colleges must follow this Policy, and must ensure that all necessary employees and other individuals are aware of and understand how to follow proper procedures with establishing and maintaining control and oversight over bank accounts. All college cash must be deposited in a bank account that conforms to the requirements of this Policy. This Policy supports other processes and procedures established to maintain the financial integrity of the University. This Policy supersedes all other policies previously issued by the University regarding the establishment and management of college bank accounts.

2. SCOPE
Unless otherwise specified, this Policy applies to all colleges, as that term is defined below. This Policy does not apply to college foundations or separately incorporated alumni associations; however, those entities are strongly encouraged to establish bank account management policies of similar scope to protect their financial integrity.

3. DEFINITIONS
As used in this Policy:
“Bank account” means any and all bank and investment accounts with financial institutions including but not limited to checking, savings, money market, certificates of deposits (CDs), mutual funds, and investment accounts.
“Business office” means the office responsible for handing the business and finance operations of a college. For a Related Entity, “business office” shall mean those individuals responsible for the day-to-day business and finance operations of the corporation, and may include individuals in the business office of the Related Entity’s supported college, as permitted by the MOU between the corporation and the college.
“Cash” means coins and currency and all negotiable instruments with monetary value (including but not limited to checks, money orders, Automated Clearing House (ACH) transactions, etc.), that can be deposited into a bank account.
“Collateralized” means assets pledged by financial institutions in the event of failure of the financial institution.
“College” means a constituent unit of the University, including without limitation senior and community colleges, graduate and professional schools, Macaulay Honors college and the central office (including the UTO and other offices and departments), as well as fund groups and organizations that are not legally separate from the University (e.g., the Queens College Athletic and Recreational Fund, the college associations of Hunter College, the School of Professional Studies and the Graduate School of Public Health and Health Policy). For purposes of this Policy, “college” also includes the Related Entities, unless otherwise indicated.
“CUNY” and “University” mean The City University of New York.
“Deputy Chief Financial Officer” refers to the individual with direct supervisory authority over the University Treasurer.
“Related Entities” means the following types of entities and their subsidiaries, if legally separate from the University and unless otherwise indicated: auxiliary enterprise corporations, college associations, student services corporations, childcare centers, performing arts centers, and art galleries.
“University Treasurer” means the senior administrator in the Office of Budget and Finance in charge of cash and investments. The University Treasurer is the business manager for the central office. The University Director of Treasury Services may perform the bank review and approval functions of the University Treasurer if the University Treasurer is unavailable to perform duties required by this Policy.
“UTO” means the University Treasurer’s Office. UTO is the business office for the central office.

4. BANK CONTROLS
In order for CUNY to maintain sufficient oversight and controls over college funds, it is essential that a college establish all bank accounts in accordance with this Policy, and that the UTO have a complete and up-to-date list of all such accounts, including closed accounts, and the signatories thereon. Bank accounts and related activity (for example, interest income and banking and investment fees) must be recorded in the University’s official accounting system (CUNYfirst) or such other accounting system used by a Related Entity, and reconciled to bank statements within the time constraints set forth in the CUNY Cash Accountability Policy.
4.1 Establishing Bank Accounts
All college bank accounts except Related Entity bank accounts. Only a college business office (for a college) or UTO (for the central office) may establish and maintain college bank accounts. Colleges wishing to open a new bank account shall complete the Bank Account Request Form attached as Appendix A to this Policy. The college (including the UTO) shall include a justification for opening the new bank account describing the potential financial advantage and/or risk mitigation as compared to the cost. The Bank Account Request Form shall be signed by the Vice President for Administration and Finance at the college or, for central office bank accounts, by the University Treasurer unless it is an UTO account, in which case it shall be signed by the Deputy Chief Financial Officer, and submitted to the University Treasurer.
The University Treasurer will notify the college business office in writing if the bank account has been approved or if the University has any concerns with the establishment of the new account. A college business office shall not proceed with establishing the new account until it has received written approval from the University Treasurer. Upon opening the new bank account, the college business office shall update the University’s banking account management system with the new account information and submit a chart field request form to create a general ledger account for the new bank account.
All college bank accounts opened after the effective date of this Policy must be established using the following naming convention: the name “CUNY” followed by the college name, followed by department or program in the account title description with the financial institution. For example, “CUNY Brooklyn College ACE”.
Related Entity bank accounts. A Related Entity may open one or more bank accounts, as approved by resolution of its board of directors, in order to conduct its business. Each Related Entity must notify the business office of its supported college and the University Treasurer of each bank account existing at the effective date of this Policy and within five (5) business days of opening any new bank account. A Related Entity shall use the Related Entity Bank Account Notification Form attached as Appendix B to this Policy to notify the college business office and University Treasurer of new accounts. Related Entity bank accounts must be established under their legal names.
4.2 Signatories
There should be three or more signatories for each bank account. An authorized signatory who is separated from the University, or otherwise has a change in employment or job responsibilities, must be removed from the list immediately and the bank notified in writing. Colleges should monitor the list of signatories with the bank and at least annually verify and update as needed the bank’s record of authorized signatories. No custodian or individual who reconciles can be a signatory. This applies to all accounts, including those in UTO. All written statements must be maintained per records retention policy.
4.3 Closing Bank Accounts
Any bank account that is no longer needed by a college shall be closed in a timely manner via a written statement to the financial institution that shall be maintained by the college pursuant to the CUNY records retention policy. The college (including all Related Entities) shall notify the University Treasurer of the account closing by using the Bank Account Closing Notification Form attached as Appendix C to this Policy. Once the account is closed, the college shall promptly update the University’s bank account management system and submit a chart field request to deactivate the general ledger account for the closed bank account.
4.4 Repurposing Bank Accounts
As a general rule, bank accounts shall not be repurposed or reused for a purpose other than the account’s original purpose. An account no longer needed should be closed, or a new account needed opened. In rare cases for a specific reason, a college may request an exception to this rule from the University Treasurer, which shall be justified in a statement that is maintained by the requestor and the University Treasurer. Similarly, in rare cases, the University Treasurer may request an exception to be allowed to repurpose an account from the Deputy Chief Financial Officer, which if approved must be similarly justified in writing.
4.5 Bank Accounts Maintained by Unaffiliated Organizations
No college shall knowingly permit the establishment of, and no college employee, other individual shall establish a bank account under a University, college or Related Entity name, address, or federal employer identification number (EIN), or permit the deposit of funds made payable to, or intended for, the University, college or a Related Entity into such an account, except pursuant to this Policy.
4.6 Annual Survey
Each college is responsible for checking regularly to ensure that there are no unauthorized bank accounts, and that all accounts are active. At least annually, the colleges shall survey financial institutions in their local area to ensure that no bank accounts have been established under a University, college or Related Entity name, address, or EIN without the knowledge or approval (as applicable) of the college business office or UTO, including closed accounts.
This survey shall be conducted by an individual who does not have the authority to open or close bank accounts.
They shall also check annually to ensure that authorized accounts are active and have appropriate signatories (see 4.2). Each college shall maintain copies of the signed letters sent to financial institutions during this annual survey along with any responses received, in accordance with the University’s record retention policy.
4.7 Electronic Fund Transfers (ACH)
To achieve faster processing, cost savings and more secure transactions than paper transfers, including checks, colleges are strongly encouraged to receive and send funds electronically via ACH (Automated Clearing House) whenever possible. Because ACH transfers are conducted by the bank using batch processing, ACH transfers are far less expensive than wire transfers are.
4.8 Custodial Credit Risk
The custodial credit risk for deposits is the risk that, in the event of the failure of a financial institution, the University or a Related Entity will not be able to recover deposits or will not be able to recover collateral securities that are in the possession of an outside party.
Colleges shall not maintain accounts at any one bank in excess of FDIC insurance limits, unless the bank is rated four (4) stars or better by Bauer Financial (www.bankrate.com). Because bank ratings will change, colleges should check the above website periodically to ensure that nothing adverse has occurred with any bank in which the college’s bank balance exceeds FDIC limits.

5. FRAUD PREVENTION SOLUTIONS
5.1 Positive Pay
Positive Pay is a service whereby an institution provides its bank with a file of all checks issued that day. If a check does not exactly match the issued item, the bank is required to notify the institution. Unless the institution instructs the bank to pay the item noted as not matching, the bank will return the check unpaid. UTO and college business offices shall institute, whenever feasible and appropriate, the Positive Pay service provided by banks to protect an institution from check fraud; this service may not be needed for small accounts.
5.2 ACH Debit Blocks / Filters
A debit block prevents ACH debits received for processing at a bank from posting to the designated bank account. Unauthorized debits are automatically returned to the originating (sending) company. Each college shall enroll in ACH Debit Block for each demand deposit account (DDAs) at the college that accepts ACH. Colleges that want to permit routine, recurring bank debit transactions to post to their bank account may establish an ACH Debit Filter. This filter can be established for a maximum dollar amount.

6. REPORTING REQUIREMENT
6.1 Foreign Bank Account Reporting (FBAR)
All colleges are responsible for Foreign Bank Account Reporting (FBAR) under the U.S Bank Secrecy Act (“Act”), if the college has a financial interest in or signature authority over a foreign financial account, including a bank account, brokerage account, mutual fund, trust, or other type of foreign financial accounts, exceeding $10,000 at any time during the calendar year. Affected colleges must file a FBAR report for foreign financial accounts on or before April 15th of the year following the calendar year being reported. The Act permits no more than a six-month extension of the filling deadline.
6.2 Suspected Fraud Reporting
Any college that suspects check or ACH fraud has occurred shall immediately report its concern to the University Director of Public Safety, University Director of Internal Audit, the Office of the General Counsel, and the University Treasurer. University Public Safety shall coordinate with the campus Director of Public Safety and the Office of the General Counsel shall communicate with and serve as liaison with the New York State Inspector General’s office and other appropriate law enforcement agencies.

7. INTERNAL CONTROLS
Maintaining sound internal controls as part of the banking process is crucial. The foundation of a good internal control system is segregation of duties. That means that the duties of (1) authorization (signing a check or releasing a wire transfer), (2) custody (having access to blank check stock or ability to establish a wire) and (3) recordkeeping (ability to record the transition in the accounting system) shall be separated so that one individual cannot complete a transaction from start to finish. To that end, the signatories on college bank accounts shall not have custody or recordkeeping ability.
The University Treasurer (for central office bank accounts), the Vice Presidents of Administration and Finance (for college bank accounts except Related Entity accounts), and the Related Entity’s board of directors (for Related Entity bank accounts) shall assign a responsible official to each bank account for the purposes of ensuring compliance with applicable University and Related Entity policies and procedures, timely reconciliation of bank accounts, adequate segregation of duties regarding the administration of the account as described below, monitoring the continued need or appropriate structure for such accounts, and other oversight requirements as appropriate. Individuals with the authority to instruct a bank to make positive pay exceptions cannot have any responsibility for the bank reconciliation of that bank account. Individuals assigned by the responsible official to reconcile the account shall not be the same individuals who are authorized to sign checks or approve electronic funds transfer (EFT’s) on the account.
The University Treasurer (for central office bank accounts), the Vice Presidents of Administration and Finance (for college bank accounts except Related Entity accounts), and the Related Entity’s board of directors (for Related Entity bank accounts) shall review and approve authorized signatories for electronic funds transfers and checks drawn on college bank accounts. The UTO or the college business office, as applicable, must maintain a current list of such authorized signatories at all times. An authorized signatory who is separated from the University or the Related Entity must be removed from the list immediately and the bank notified in writing.
The CUNY Cash Accountability Policy includes additional internal controls and segregation of duties requirements.

8. RECORD RETENTION
Each college shall consult the University’s Records Retention and Disposition Schedule to ensure that they are in compliance with records retention and disposition related to banking.

9. BANK ACCOUNT POLICY ACKNOWLEGEMENT
Each college shall ensure that this Policy is provided to all new employees and on an annual basis to all individuals at the college who are involved in bank account administration and that such individuals acknowledge in writing that they have received and read this Policy, using the Acknowledgement Form in Appendix D. Individual acknowledgements shall be maintained on file with the college business manager.

10. EXCEPTIONS AND ALTERNATIVE PROCEDURE
Any exception to this Policy shall be approved by both the Vice President of Administration and Finance at the college and the University Treasurer, documented with the justification therefor in writing, maintained in the files of both offices, and reviewed and a new determination made and documented on at least an annual basis.

11. EFFECTIVE DATE AND TRANSITION
The Policy is effective January 1, 2018. Changes adopted to conform to this Policy shall be applied as of that date.

12. UPDATE AND PERIODIC REVIEW
The University Office of Budget and Finance is responsible for the periodic review and recommendation of changes to this Policy, as well as for ensuring that all appropriate parties are informed of it.

13. EXTERNAL LINKS
FDIC Frequently Asked Questions (FAQs): https://www.fdic.gov/deposit/deposits/faq.html
The FBAR filing link: https://bsaefiling.fincen.treas.gov/main.html
Record Retention Schedule: http://www.cuny.edu/recordretentionschedule

14. APPENDIX
A) Bank Account Request Form
B) Related Entity Bank Account Notification Form
C) Bank Account Closing Notification Form
D) Bank Account Control Acknowledgement Form

(BTM, 1952,06-16,015,__. Amended: BTM, 2017, 12-04,3,C)

ARTICLE III FISCAL AFFAIRS

Policy 3.0101 Cash Accountability

ARTICLE III FISCAL AFFAIRS

Policy 3.011 College Foundation Guidelines

ARTICLE III FISCAL AFFAIRS

Policy 3.02 Honoraria, Travel Reimbursements, and Outside Activities

Policy 3.02 Honoraria, Travel Reimbursements, and Outside Activities
The Board of Trustees of The City University of New York, in accordance with the Regulations of the New York State Ethics Commission implementing the New York State Ethics in Government Act, hereby designates the President of each senior college of the University to serve as the approving authority to review requests for approval of honoraria and travel reimbursements, and outside activities. The Chancellor of the University is to serve as the approving authority for the presidents of the senior colleges. The Chancellor, or the Executive Vice Chancellor as his or her designee, is to serve as the approving authority for the covered Central Office staff. The Chairperson and the Vice Chairperson of the Board of Trustees are to serve as the approving authority for the Chancellor of the University. (BTM,1990,09-24,006,_B)
The Board of Trustees of the University, in accordance with the Regulations of the New York State Ethics commission implementing the State Ethics Law, hereby designates the President of each community college of the University to serve as the approving authority to review requests for approval of honoraria and travel reimbursements, and outside activities. The Chancellor of the University is to serve as the approving authority for the presidents of the community colleges. (BTM,1990,09-24,006,_B)

ARTICLE III FISCAL AFFAIRS

Policy 3.03 Investment

CITY UNIVERSITY OF NEW YORK INVESTMENT POLICY
1. Purpose of the Investment Policy Statement
This Investment Policy governs the management of the City University of New York’s (“CUNY”) Long-Term Investments.
2. Background
CUNY’s Long-Term Investment Pool (the “Portfolio”) was created to serve the long- term financial needs of CUNY, its Colleges and participating College Foundations. The Portfolio is a pooled investment vehicle for multiple individual accounts that include both endowed and non-endowed funds. The Portfolio consists of funds received by CUNY for its general purposes, funds received by CUNY for the benefit of a specific CUNY College and funds belonging to one or more of the College Foundations that have chosen to invest in the Portfolio. It therefore serves as an umbrella vehicle for multiple participants, many of which have other long-term funds.
It is the aim of the CUNY Portfolio to become the preferred choice for placement of the long-term assets of the affiliated College Foundations. Such co-investment would clearly be beneficial for all parties involved as increased asset size would afford greater investment flexibility with higher return potential and lower costs.
This policy adheres to the standards of prudent management of investment assets set forth in the New York Prudent Management of Institutional Funds Act (NYPMIFA).
3. Responsibilities
A.The Board of Trustees serves as steward of the Portfolio and is responsible for approving this Policy and all amendments thereto and for approving the selection of the Investment Consultant(s). The Board hereby delegates all other responsibilities relating to the Portfolio to the Fiscal Affairs Committee and its Subcommittee on Investments, both of which serve as fiduciaries on behalf of the Board of Trustees. The Board will monitor the activities of the Fiscal Affairs Committee and the Subcommittee on a regular basis.
B.The Fiscal Affairs Committee (“Committee”) shall provide broad oversight of the investment program, including an annual review of the work of the Subcommittee on Investments.
C.The Subcommittee on Investments (“Subcommittee”) shall be composed of trustees, appointed by the Chairperson of the Board of Trustees in consultation with the Chancellor, with expertise and/or experience in the financial industry and one faculty member recommended by the University Faculty Senate for consideration by the Chairperson. The Subcommittee shall be responsible for the total investment program and will provide prudent oversight of the Portfolio in order to further the goals and mission of CUNY, its Colleges and the participating College Foundations, and to ensure that CUNY’s investment and management of investment assets comply with NYPMIFA. More specifically, the Subcommittee shall be responsible for:
i.Developing objectives and strategies for the Portfolio consistent with this Policy and with the prudence factors and principles laid out in Section 6;
ii.Setting an optimal asset allocation in light of the above strategy;
iii.Meeting quarterly to review and evaluate asset allocation, current investment results, various risk factors and to identify areas of improvement and/or correction; such meetings to occur, if possible, after the release of quarterly results from the Investment Consultant; and
iv.Reporting at least annually to the Fiscal Affairs Committee and the Board of Trustees on investment policy, asset allocation and performance of the Portfolio as well as other substantive matters.
The Committee on Fiscal Affairs and its Subcommittee on Investments may delegate authority to the Vice Chancellor of Budget & Finance as it relates to the current Policy concerning decisions to make marketable and non-marketable alternative investments, as circumstances warrant.
In addition, the Subcommittee may delegate certain investment responsibilities to external agents such as consultants and investment managers. Such delegation must be conducted in a prudent manner and in good faith and requires at a minimum:
a)Clear definition of the scope and terms of the delegation and assessment of the reasonableness of the compensation charged by the agent;
b)Proper due diligence including assessment of the agents’ independence and potential conflicts of interest;
c)Subsequent monitoring of the delegated areas including reasonable efforts to verify accuracy of information provided by the agents; and
d)Contracts with external agents must specify that (i) they can be terminated without penalty by CUNY upon no more than 60 days’ notice and (ii) the external agent owes a duty to CUNY to exercise reasonable care, skill and caution to comply with the scope and terms of the delegation.
D. CUNY Management and Staff shall be responsible for implementing Subcommittee decisions; administering the Portfolio; pre-screening Investment Managers for the Subcommittee’s consideration; rebalancing the Portfolio; presenting investment results; coordinating with the Investment Managers, Consultant(s) and Custodian and assisting the Subcommittee to fulfill its responsibilities as described above. In addition, the Vice Chancellor for Budget & Finance or his designee may, after consulting with the Chairperson of the Subcommittee, authorize action on Portfolio issues that require immediate action that cannot await the scheduling of a meeting of the Subcommittee. All such emergency actions shall be reported to the Subcommittee immediately in writing.
E.The members of the Subcommittee shall adhere to the Code of Conduct and Conflict of Interest Policies in the Manual of General Policy, Sections 2.5 and 6.1, respectively. CUNY Management and Staff must adhere to New York State ethics provisions under Public Officer Law, Sections 73 and 74.
F. Each Investment Consultant shall provide assistance to the Subcommittee and CUNY Management and Staff, as requested, on the development, implementation, and ongoing practice of investment guidelines and practices consistent with the Subcommittee’s mandate to provide prudent oversight of the Portfolio. Each Investment Consultant shall also assist CUNY Management and Staff and the Sub- Committee with the selection of investment managers and provide periodic investment ideas tailored to CUNY’s specific needs as well as provide investment performance measurement and advice concerning risk management strategies, primarily through asset allocation studies and diversification strategies. Each Consultant shall act as a fiduciary of the Portfolio.
G. Each Investment Manager shall be responsible for investing as a fiduciary with discretion the assets under its management and in reporting and communicating with the Subcommittee in accordance with the general and specific guidelines set by the Subcommittee and in compliance with industry standards.
H. Each Custodian shall be responsible for all needs relating to the custody and accounting of the Portfolio’s assets, including processing all Investment Manager transactions, related additions or withdrawals, as well as daily cash sweep of idle balances and securities lending, and reporting and communicating with CUNY Management and Staff, Investment Managers and Investment Consultant(s), in accordance with the general and specific guidelines set by the Subcommittee.
I.In carrying out their responsibilities, the members of the Subcommittee, CUNY Management and Staff and external agents shall comply with the duties of loyalty and care, which require each such person to act in what he or she believes is the best interest of CUNY and in good faith and with the care an ordinarily prudent person in a like position would exercise under similar circumstances.
4. Investment Objectives
A. The Financial Objectives of the Portfolio are to provide continuous support to the operations of CUNY, its Colleges and the participating College Foundations through relatively predictable and stable annual spending, while at the same time preserving and enhancing the purchasing power of the Portfolio for the benefit of future generations of students.
B. The Long-Term Investment Objectives of the Portfolio are to (1) attain an average annual real (inflation-adjusted) total return 1 at least equal to 5% plus management and administrative fees; (2) outperform the Portfolio’s custom benchmark; and (3) outperform the median return of a pool of endowment funds with broadly similar investment objectives and policies both on an absolute and on a risk-adjusted basis.
[Footnote:] 1 Real total return is the sum of realized and unrealized capital appreciation (or loss) and current income in the form of dividends and interest, adjusted for inflation, as measured by the Consumer Price Index.
In order to achieve the above objectives, CUNY has adopted the asset allocation as specified in Appendix A hereto. CUNY recognizes that the investment objectives may not be achieved in any single year. Instead, a longer-term horizon of 3-7 years shall be used in measuring the long-term success of the Portfolio.
5. Spending Policy
The Portfolio shall be managed according to the “total return” concept, which envisions the sources of spending as being from interest, dividends and capital gains.
Except as otherwise provided in the Spending Policy set forth in Appendix B of this Policy, decisions with respect to spending from the Portfolio shall be made by the Board upon recommendation from the Subcommittee. In doing so, both Board and Subcommittee shall comply with the prudence standard and observe the procedures set forth in the Spending Policy.
6. Asset Allocation and Portfolio Composition
In establishing the Asset Allocation and in its implementation, the Subcommittee shall consider the following factors, if relevant, as required by NYPMIFA:
o General economic conditions;
o The potential impact of inflation/deflation;
o The expected tax consequences, if any, of investment decisions or strategies;
o The role of individual investments in context of the overall Portfolio;
o The expected total return from income and the appreciation of investments;
o The overall resources of CUNY;
o The needs of CUNY and of the Portfolio participants to make distributions and preserve capital; and
o The relationship of any given investment asset to the mission/purpose of CUNY or a participant.
Any investment decision shall always take into account the purposes of CUNY and the funds that comprise the Portfolio. Investment decisions shall, furthermore, not be considered in isolation but on a total portfolio basis. Also, as specified below, the Portfolio shall be diversified and implemented in a cost effective way.
The asset allocation of the Portfolio shall reflect a proper balance of CUNY’s investment objectives, risk tolerance and need for liquidity. To achieve this balance, the portfolio shall conceptually be divided into three parts: an equity portfolio, a diversifying assets portfolio, and a fixed income portfolio.
The purpose of the equity portfolio shall be to provide capital appreciation in order to meet the financial objective of supporting current operations while preserving, and preferably growing, the purchasing power of the fund. In order to meet the investment objectives, the equity portfolio shall be the dominant of the three sub-portfolios. CUNY recognizes that equity investments will most likely entail a substantial degree of volatility. The equity fund shall be invested in both U.S. and non-U.S. public and private equities.
The purpose of the diversifying assets portfolio shall be a) to provide additional diversification through investments in assets and/or investment strategies with attractive expected returns combined with low expected correlations with the traditional equity and fixed income holdings of the portfolio and b) to support the Portfolio through periods of unexpected high inflation through investment in assets and asset classes which are expected to perform well during inflation. The diversifying assets portfolio may include real estate, inflation-adjusted fixed income securities, commodities and natural resource- related stocks. The diversifying asset portfolio may also include hedged strategies, including strategies that use leverage and derivatives, and may encompass both public and private investment vehicles.
The primary purpose of the fixed income portfolio shall be to provide a hedge against the effects of a prolonged economic contraction. A secondary purpose shall be to contribute to overall return and to reduce the overall volatility of the total Portfolio’s returns. In order to achieve the primary purpose, investments should be made primarily in long- duration, non-callable or call-protected, high quality bonds.
Given the long-term nature of the Portfolio, the policy allocation to cash and cash equivalents should normally be zero, but transitional cash positions may be held.
As noted above, the specific asset allocation with ranges as determined by the Subcommittee is contained in Appendix A hereto.
7. Diversification, Risk and Liquidity
The Portfolio’s investments shall be diversified both by Investment Manager, by asset class and within asset classes. The purpose of diversification is partly to enable higher returns with lower risk than would otherwise be achievable and partly to ensure that no single manager, security, asset class or specific investment style will have a disproportionate impact on the Fund’s aggregate returns.
As risk and return are related entities, the Subcommittee, assisted by the Consultant(s), shall consider risk along with returns in evaluating each portfolio, asset class or Investment Manager and shall ensure that risk, in its various forms, is monitored, evaluated and discussed on a regular basis.
Investment in alternative assets will often entail illiquidity. While such investments can be a natural part of a well-diversified portfolio, the Subcommittee shall consider the liquidity needs of CUNY, its Colleges and the participating College Foundations, and shall keep the illiquid investments at a level where illiquidity does not endanger regular spending, including in situations of negative portfolio returns.
8. Rebalancing
Assets shall be rebalanced back to their respective targets to ensure that the asset allocation remains an accurate reflection of CUNY’s desired risk profile. The following methods shall be used: 1) rebalancing using cash inflows and outflows, 2) rebalancing annually in April or May using March 31 market values, and 3) rebalancing back to the target allocations should actual allocations move outside allowable ranges.
The Subcommittee may decide, as an appropriate investment tactic, to underweight or overweight a specific asset class within the allowable range for a time, in which case the automatic rebalancing back to target will not take place. Such decisions shall be recorded in the meeting minutes.
To the extent that CUNY receives property and/or securities from donors or otherwise, decisions regarding the disposition or retention of the asset(s) must be made in a timely manner. It is the assumption that such asset(s) will be liquidated and the proceeds considered a cash flow for rebalancing purposes.
9. Manager Hiring and Firing
The Subcommittee shall not consider the selection of any Investment Manager without first setting a target allocation to a particular asset class and determining that a manager is needed to implement that allocation strategy.
The Subcommittee shall fairly and rigorously evaluate prospective Investment Managers. The Subcommittee shall strive to hire Investment Managers that are appropriate for the Portfolio’s risk-return profile using industry best practices which include a thorough examination of the firm’s organization, history, integrity, ownership structure and assets under management, the quality and stability of its key professionals and staff, the quality and consistency of its investment philosophy, strategy, decision-making process, its fit with the Portfolio’s objectives, its performance metrics, its record of compliance and its fee structure.
The Investment Consultant(s) and CUNY Management and Staff shall monitor and keep the Subcommittee up to date with respect to Investment Managers, including their compliance with this Policy, their investment performance, any significant changes in their organization, process or philosophy and all pertinent information regarding regulatory or disciplinary investigations, proceedings or findings and/or litigation.
Though active managers are hired to outperform their respective benchmarks, it is a commonly accepted fact that even strong managers may have periods of relative underperformance. Firing a manager due to short-term performance issues can often have a negative impact on a portfolio since manager performance tends to be cyclical, so that managers who underperform in one cycle often will outperform in the next and vice versa. The Subcommittee aims to have stable, long-term manager relationships. In that regard it plans to evaluate manager returns over various and appropriate time periods. However, a manager may be placed on a watch list in response to the Subcommittee’s concerns about the manager’s performance, failure to comply with guidelines, organizational changes, or any other reason that the Subcommittee or CUNY Management and Staff deems appropriate.
10. Performance Monitoring
With the assistance of the Investment Consultant(s) and CUNY Management and Staff, the Subcommittee shall review regularly the Portfolio’s assets and the status of its investment accounts, and shall make such adjustments as deemed necessary to achieve CUNY’s investment objectives. In addition, CUNY Management and Staff shall receive monthly performance reporting primarily for administrative purposes.
A. The total portfolio shall be evaluated against the investment objectives. This entails measuring whether, over rolling three- to seven-year periods, it outperforms a) the real total return objective set forth in Section 4B of this Policy, b) the custom benchmark consisting of a mix of appropriate benchmarks for each of the major asset categories within the policy asset allocation at the target weights, and c) a peer group of comparable colleges and universities.
B. The performance of each of the main components of the portfolio shall be measured against asset class-specific benchmarks, which will enable evaluation of the effectiveness of the implementation strategy used for that asset class.
C. The Investment Managers shall be monitored on returns relative to a manager- specific benchmark as well as to returns of a peer group of comparable managers.
D. The performance reporting shall be carried out in a manner and form that enables the Subcommittee to clearly evaluate portfolio and manager performance, both on an absolute and on a risk-adjusted basis, as described above. Relevant benchmarks for each category will be incorporated in guidelines.
11. Investment Guidelines
With the assistance of the Investment Consultant(s), CUNY Management and Staff shall create specific guidelines for each Investment Manager when it is hired and shall review and recommend changes to those guidelines as necessary.
To the extent that CUNY invests in mutual funds and/or commingled vehicles, the guidelines are contained in the offering documents. Since, in these cases, CUNY cannot impose its own guidelines, CUNY Management and Staff, assisted by the Consultant, shall determine beforehand whether the guidelines contained in the offering document are acceptable and suitable for the given mandate.
Each Investment Manager shall be required to monitor compliance with its specific guidelines quarterly (or more frequently if market conditions warrant) and based on the then-current market values. Each Investment Manager shall be required to promptly communicate in writing to the Subcommittee any violations of the guidelines stating the nature of the violation, potential remedies, or a petition that a compliance waiver be granted setting forth the reasons therefore. CUNY Management and Staff, assisted by the Consultant(s) shall be responsible for enforcing this requirement.
All such guidelines shall incorporate the following basic principles:
A. Manager Autonomy
Decisions as to individual security selection, security size and quality, number of industries and holdings, current income level, turnover, and the other tools employed by active managers, shall be left to broad manager discretion, within the limits of any specific guidelines and subject to the prudence standards under NYPMIFA.
B. Leverage and Derivatives
Unless explicitly authorized by the Subcommittee, the use of leverage or speculative use of derivatives shall be prohibited unless as part of an alternative asset program or as a means for investment managers to hedge investment risk, to hedge currency risk or replicate investment positions at a lower cost than would otherwise be created in a cash market. If the use of leverage or speculative use of derivatives is authorized, the
guidelines shall include specific limitations on their use. In such cases, managers must have systems in place to rigorously analyze, monitor and control associated risks.
C. Diversification
Each Investment Manager shall be required to diversify holdings so that the portfolio is not exposed unduly to any single security issuer or sector. The guidelines shall set forth holding limits applicable to that Investment Manager.
D. Duty to Inform
Each Investment Manager shall be required to inform CUNY as soon as possible if a deviation from guidelines is anticipated and seek approval. In addition, each Investment Manager shall be required to inform CUNY as soon as practicable of any significant change in firm ownership; acquisitions of other investment managers; changes to organizational structure; investigations or proceedings commenced by or subpoenas received from the SEC or any other regulatory or law enforcement agency; official notice of any disciplinary proceeding or litigation against the manager or any of its employees; departures of key professional personnel; changes of account structure or changes in the manager’s fundamental investment philosophy.
Each Investment Manager shall be required to propose revisions to the guidelines at any time the existing guidelines would impede meeting the investment objectives established for the manager.
E. Best Execution
Except under unusual circumstances (in which case CUNY shall be promptly notified), each Investment Manager shall be required to enter into all transactions on the basis of best execution, which means best realized net price. Turnover should be minimized consistent with the effective implementation of the strategy.
12. Changes to the Investment Policy
This Policy shall be in force until modified in writing and approved by the Board of Trustees. The Subcommittee will review this Policy at least annually to ensure continued appropriateness, but may propose revisions to it at any time it sees fit. The Subcommittee shall communicate proposed changes to this Policy to the Fiscal Affairs Committee.
Effective December 8, 2008
As Amended on April 26, 2010
As Amended on May 2, 2011
As Amended on November 28, 2011
As Amended on June 25, 2012
As Amended on June 24, 2013
As Amended on May 4, 2015
APPENDIX A
Asset Allocation
Asset Class, Policy Target, Policy Range
U.S. Equity, 21% , 15% – 30%
Global ex. U.S. Equity, 18% , 10% – 25%
Emerging Market Equity, 8% , 5% – 12%
Marketable Alternatives, 18% , 10% – 25%
Public Real Assets, 10% ,
, , 8% – 20%
Private Real Assets, 5% ,
Private Equity, 10% , 0% – 15%
Fixed Income, 10% , 5% – 15%
Cash, 0% , 0% – 5%
Targets and ranges will be reviewed at least annually and any changes will be communicated to the Board of Trustees.
Appendix B
Spending Policy
The City University of New York (CUNY) Portfolio is a pooled investment vehicle for multiple individual accounts that include both endowed and non-endowed funds. The Portfolio consists of funds received by CUNY for its general purposes, funds received by CUNY for the benefit of a specific CUNY College and funds belonging to one or more of the College Foundations that have chosen to invest in the Portfolio. CUNY’s policies and procedures with respect to spending from the Portfolio shall comply with The New York Prudent Management of Institutional Funds Act (NYPMIFA).
1. Spending Decisions
A. CUNY Funds
“CUNY Funds” in the Portfolio consist of both endowed and non-endowed funds received by CUNY for its general purposes or for the benefit of a specific CUNY College. Decisions with respect to spending from CUNY Funds in the Portfolio shall be made by CUNY’s Board of Trustees on recommendation from the CUNY Subcommittee on Investments (the “Subcommittee”).
In making any recommendation or decision to appropriate funds from a CUNY Fund for expenditure, or to accumulate funds in a CUNY Fund, the Subcommittee and Board must act in good faith with the care that an ordinarily prudent person in a like position would exercise under similar circumstances and must consider, if relevant, each of the following factors:
o The duration and preservation of that fund;
o The purpose of CUNY and that fund;
o General economic conditions;
o The possible effect of inflation and deflation;
o The expected total return from income and appreciation of investments;
o Other resources of CUNY;
o Where appropriate, alternatives to spending from that fund and the possible effects of those alternatives on CUNY; and
o The principles and policies set forth in this Investment Policy.
NYPMIFA contemplates that decisions to appropriate endowed funds are to be made on a fund-by-fund basis and requires that appropriations from an endowed fund be made in accordance with any specific directives on spending that the donor, in the gift instrument or pursuant to the notice provision of NYPMIFA, has imposed. To ensure compliance with NYPMIFA, CUNY Funds in the Portfolio may be categorized into groups of similarly situated funds for the purpose of allowing the Subcommittee, in accordance with the prudence standard set forth in this Subsection 1A, to make a
recommendation to the Board as to the appropriate spending rate that should be applied to each such group of similarly situated funds. For this purpose, CUNY Funds generally will be classified by purpose into the following categories of similarly situated funds: (i) scholarship and fellowship; (ii) academic support; (iii) institutional support; and (iv) instruction. CUNY Funds also may be categorized for this purpose based on spending restrictions imposed by donors in the gift instruments or pursuant to the notice provision of NYPMIFA. The Board, in accordance with the prudence standard set forth in this Subsection 1A, then shall make a decision as to the appropriate spending rate that shall be applied to each such group of similarly situated funds. As part of its deliberations, the Subcommittee periodically shall review the categories of similarly situated funds and the composition of each such group to ensure that such funds are properly classified.
Specific donor directives on spending may preclude classification of a CUNY Fund into any category of similarly situated funds. When making an appropriation recommendation or decision from such a CUNY Fund, the Subcommittee and Board of Trustees shall consider such CUNY Fund separately and appropriations from such Fund will be made in accordance with any specific directives on spending that the donor has imposed.
In order to preserve and enhance the purchasing power of the Portfolio for the benefit of future generations of students, CUNY does not distinguish between endowed and non-endowed CUNY Funds when making appropriation decisions in accordance with the prudence standard set forth above. Furthermore, the annually decided spending rate is not indicative of a required spending level; Participant spending from the Portfolio shall be on an as-needed basis to the exclusion of withdrawals without specific purpose.
Given the Portfolio’s multiple participants with varying financial needs, the Vice Chancellor of Budget & Finance, or his designee, may exercise discretion, should special circumstances warrant, in applying the applicable spending rate determined for a non- endowed fund in accordance with the process set forth above, and may authorize an expenditure above the applicable spending rate. Any such delegated decision shall be reported to the Vice Chancellor of Budget & Finance.
In order to preserve the long-term value of the Portfolio, it has been CUNY’s practice to keep spending from the Portfolio each year at or below 5% of the Portfolio’s average market value. The spending rate is determined based on the average market value of the Portfolio for at least the immediately preceding twenty quarters. While the decision to appropriate from a CUNY Fund must be made with due consideration to the above eight factors, the Board and Subcommittee each also will consider this spending guideline, to the extent possible and prudent, when carrying out its responsibilities with respect to determining annual endowment spending.
Decisions to appropriate funds for expenditure from the Portfolio generally will be made by the Subcommittee and the Board on an annual basis at one of the spring meetings of the Subcommittee and Board held prior to the beginning of the new fiscal year on July 1st. The spending rate determined by the Board for each group of similarly situated funds shall apply to all funds in such group during the relevant fiscal year, whether such funds are held by CUNY at the time the appropriation decision is made or received by CUNY subsequent to such decision. At any time during the fiscal year, the Board may meet to reconsider and, if so determined, alter such spending rate decisions. At any time during the fiscal year, the Board may meet to reconsider and, if so determined, alter such spending rate decisions. To the extent that a Participant’s needs are less than the applicable spending rate, any residual amount shall remain within the Participant’s share of the Portfolio and is not carried over to future years.
B. College Foundation Funds
Certain funds in the CUNY Portfolio belong to College Foundations that have chosen to co-invest with the Portfolio for reasons of cost, expertise and efficiency. College Foundation funds invested in the Portfolio are not owned by CUNY and decisions with respect to spending from such College Foundation funds must be made by the Board of Directors of the respective College Foundation. Policies and procedures with respect to requesting annual distributions from the Portfolio shall be set forth in the Memorandum of Understanding between CUNY and the College Foundation.
In order to preserve the long-term value of the funds it has invested in the Portfolio, each College Foundation, in their spending deliberations, will consider, to the extent possible and prudent, the 5% spending guideline for the Portfolio expressed in Subsection 1A above.
2. Minutes of Spending Deliberations
Both Board and Subcommittee deliberations with respect to spending from the Portfolio shall be recorded in the minutes of the Board and Subcommittee meetings at which such decisions are made. The record of any recommendation or decision to appropriate endowment funds for expenditure shall describe the consideration that the Subcommittee or Board gave to each of the eight factors listed in Subsection 1A of this Spending Policy.
(Board of Trustees Minutes,2008,12-08,5,A. Amended: Board of Trustees Minutes,2010,04-26,3,E; Board of Trustees Minutes,2011,05-02,3,D; Board of Trustees Minutes,2011,11-28,3,F; Board of Trustees Minutes,2013,06-24,3,G; Board of Trustees Minutes,2013,06-24,3,J; Board of Trustees Minutes,2013,06-24,3,K; Board of Trustees Minutes,2015,05-04,3,H; Board of Trustees Minutes,2015,05-04,3,I)

ARTICLE III FISCAL AFFAIRS

Policy 3.04 Non-Tax Levy Funds

ARTICLE III FISCAL AFFAIRS

Policy 3.04001 Petty Cash

ARTICLE III FISCAL AFFAIRS

Policy 3.0401 Procurement Policy and Procedures

Procurement Policy and Procedures of The City University of New York
I. Purpose and Application
A. This Policy sets forth guidelines applicable to the procurement of commodities and services by The City University of New York (the “University”). This Policy shall constitute guidelines of the Board of Trustees of the University under Section 6218 of the New York State Education Law.
B. This Policy applies to procurements of commodities and services using funds by the University, including all senior and community colleges and the Central Office. Funds covered by this Policy include: those appropriated by the State of New York (the “State”) or the City of New York (the “City”); student tuition and fees; and funds held by the State Treasury in income fund reimbursable accounts, such as technology fees. This Policy does not apply to procurements by The Research Foundation of the City University of New York, The City University Construction Fund, college associations, auxiliary enterprise corporations, college foundations, or other separately incorporated affiliated entities except as described in any policies, guidelines, or procedures issued by the University, including any Office of University Controller Financial Management Guidelines; however, this Policy does apply to contracts funded by any of these organizations but entered into by the University.
C. References herein to the “University” shall include each of the University’s constituent colleges, including the Central Office.
II. Policy Statement
A. It is the policy of the University to procure commodities and services in a manner that promotes: (i) the wise, prudent, and transparent use of the resources of the University and the taxpayers of the City and State; (ii) compliance with all provisions of law governing procurements by the University; (iii) the acquisition of quality commodities and services at reasonable prices in a timely and efficient manner; (iv) the maximum feasible participation of New York State-certified minority- and women-owned business enterprises (“MWBE”) and service-disabled veteran-owned business enterprises (“SDVOB”) in University procurements, as required by law and University policy; and (v) the prevention of favoritism, extravagance, fraud, and corruption, or the appearance thereof.
B. In furtherance of the above policy, the University shall conduct procurements in accordance with the procedures and other requirements set forth below.
III. General Purchasing Requirements
A. All University procurements, regardless of size, must adhere to the following general requirements:
1. complying with all applicable ethics rules, including purchasing commodities and services in the best interest of the University and adhering to the University’s Conflict of Interest Policy and Sections 73 and 74 of the New York State Public Officers Law;
2. complying with all laws, rules, and regulations that apply to the University, whether or not specifically described in this Policy, including the applicable provisions of the New York State Education Law and State Finance Law;
3. conducting all University-wide and Central Office purchases through the Office of Budget and Finance and all college-specific purchases through the respective campus Purchasing Departments (collectively, “Purchasing Departments”); no other office or department may conduct procurements or otherwise bind the University to any purchase of commodities or services;
4. estimating the applicable dollar value of a potential purchase to ascertain what procurement methods may be required (and prohibiting the artificial division of purchases in order to use the less formal procurement methods available to smaller purchases), and monitoring actual purchases made of the same commodity or service to determine whether additional procurement requirements may apply in the future to the same purchase;
5. ensuring that the commodity or service sought satisfies the University’s required form, function, and utility, and determining whether an Existing Contract (as defined in Section V(G)) offers commodities or services that can satisfy these requirements;
6. using competitive solicitation methods (such as quotes, sealed bids, and sealed proposals) to the maximum extent practicable when conducting individual University procurements;
7. only using form solicitation documents issued by the University’s Office of the General Counsel;
8. promoting the maximum feasible participation of MWBEs and SDVOBs in University procurements including, where applicable, setting participation goals on procurements to encourage MWBEs and SDVOBs to participate as subcontractors or suppliers and ensuring prime contractor compliance with such participation goals, as required by law and University policy;
9. obtaining all necessary internal and external approvals required by applicable law and University policy, including those of the New York State Office of the State Comptroller (the “State Comptroller”), the Board of Trustees, the Office of the General Counsel, and the Office of Budget and Finance;
10. advertising procurements as required by applicable law and University policy;
11. maintaining a record of the procurement that demonstrates that all requirements of this Policy and of applicable law have been met;
12. awarding contracts to “responsive” and “responsible” vendors, as defined in applicable law;
13. complying with the University’s contract signing authority policies, as set forth by the Board of Trustees and as further delegated by the Chancellor and the General Counsel of the University;
14. only executing contracts and other agreements that have been approved as to form by the Office of the General Counsel; and
15. following such other procedures, manuals, memoranda, directives, and the like issued by either or both of the Office of the General Counsel and the Office of Budget and Finance that relate to this Policy.
IV. Overview of Procurement Methods
A. The University may conduct procurements of needed commodities and services through a variety of methods. Among the most common methods are: (1) using preferred source offerings, existing centralized contracts of the State, the City, and the Federal government, University-wide contracts, “piggyback” contracts, and consortia contracts; (2) competitive solicitations of sealed bids and sealed proposals; and (3) entering into contracts using informal procurement methods, or on a sole source, single source, or emergency basis.
B. The University may use Existing Contracts, which are established on behalf of the University by the Office of Budget and Finance or made available to the University by the State, the City, or the Federal government. Among other reasons, because the use of these Existing Contracts reduces costs by leveraging collective buying power and saves administrative time, this Policy requires that the University use these contracts under the circumstances set forth below. In addition, in instances where the Office of Budget and Finance has established University-Wide Contracts (as defined in Section V(E)) with vendors on an exclusive basis, the University must use those contracts in all instances unless an exception is granted by the Office of Budget and Finance. However, if no exclusive University-Wide Contract exists, then the University, through the applicable Purchasing Department, may elect to forgo using any Existing Contracts where the available contracts do not meet the University’s requirements, or where justified by price, as set forth in greater detail below. In those cases the University may instead conduct an individual procurement, including through bids, proposals, quotes, and other methods, or make purchases on a sole source, single source, emergency or other basis, as permitted by this Policy.
V. Order of Purchasing Priority and Procurement Methods
A. The University shall conduct all procurements of commodities and services, including University-wide procurements, using the methods and procedures described in this Section V. However, in selecting a procurement method, the University shall adhere to the order or priority assigned to these methods in Section V(B) (such methods and priority, collectively, the “Purchasing Hierarchy”). Sections V(C) through V(G) provide a description of, and procedures for using, each procurement method in the Purchasing Hierarchy. Sections V(E)(3) and V(H) provide a description of exceptions to the Purchasing Hierarchy. The determination of the appropriate procurement method shall be made by the applicable Purchasing Department.
B. Purchasing Hierarchy.The University shall adhere to the following order of priority when conducting procurements:
1. New York State Preferred Sources;
2. OGS Commodities Contracts;
3. University- Wide Contracts;
4. Other Centralized Contracts of the State, City, and Federal government;
5. any of the following options, which shall be afforded equal priority:
• Campus Procurements (with or without a formal competitive process depending on the total value of the procurement);
• “Piggybacking” off of an established governmental contract (other than an OGS Commodities Contract or Other Centralized Contract); or
• Consortia Contracts approved by the Office of the General Counsel and the Office of Budget and Finance.
6. Sole Source, Single Source, and Emergency Procurements, where appropriate, are exceptions to the above order of priority.
C. New York State Preferred Sources.In order to advance special social and economic goals of the State, the University is required to purchase select commodities and services from State-designated organizations that support employment of certain individuals, including those with disabilities, in correctional facilities, and who are blind. Currently, these organizations include the NYS Department of Correctional Services (“Corcraft”), the NYS Preferred Source Program for People Who Are Blind (“NYSPSP”), and the NYS Industries for the Disabled (“NYSID”) (collectively, and as updated pursuant to applicable law, “Preferred Sources”). The University is required to purchase from Preferred Sources commodities or services that meet the University’s form, function, and utility requirements and are offered at a price, as determined by the New York State Office of General Services (“OGS”), that is no more than 15% greater than the prevailing market rate (or in the case of Corcraft, commodities that are offered at a price that do not exceed a reasonable, fair market rate as determined by the Department of Correctional Services (“DOCS”)). Purchases of commodities and services from Preferred Sources are given the highest priority and are exempt from competitive bidding requirements. The University shall make purchases from Preferred Sources in the following manner, and in accordance with any guidelines issued by OGS relating to Preferred Sources (except to the extent such guidelines in their application to CUNY would conflict with applicable law):
1. When making any purchase the University must first consider using Preferred Sources generally. When purchasing commodities, the University must consider Preferred Sources in the following priority order: (1) Corcraft; (2) NYSPSP; (3) NYSID, or as otherwise required by the State. When purchasing services the University may afford each available Preferred Source equal priority, and if more than one Preferred Source can provide the required services, then price shall be the determining factor.
2. When a commodity or service is available from a Preferred Source in the form, function, and utility required by the University, and at prices that are approved by OGS or DOCS as contemplated in Section V(C) above, then the University is required to purchase from the Preferred Source.
3. If the University wishes to purchase a particular commodity or service through a competitive solicitation even when the commodity or service is available from a Preferred Source, then the University must compile defensible documentation and evidence justifying why the Preferred Source was not used. If a Preferred Source is not selected, then that Preferred Source also must be given prior written notice with an explanation and an opportunity to respond.
D. OGS Commodities Contracts.OGS has established centralized contracts for a wide range of commodities (“OGS Commodities Contracts”). The University shall make purchases from OGS Commodities Contracts in the following manner:
1. Where no Preferred Source can meet the University’s form, function, and utility requirements for a commodities purchase, or where justified by price, the applicable Purchasing Department must determine whether the required commodity can be obtained through an existing OGS Commodities Contract. If a vendor on an OGS Commodities Contract can provide the needed commodities and meet the University’s form, function, and utility requirements, then the University shall make the purchase from such vendor, unless the applicable Purchasing Department makes the determination that it can obtain lower pricing from an alternate source.
2. When soliciting alternate pricing, the University may seek pricing from the open market but, at a minimum, must seek pricing from vendors available through University-Wide Contracts and Other Centralized Contracts that are available. OGS Commodities Contract vendors must be allowed a minimum of two business days to match any lower price offered to the University. If the OGS Commodities Contract vendor provides written confirmation that it will match a lower price received by the University on the open market, then the University shall purchase from such OGS Commodities Contract vendor. If the OGS Commodities Contract vendor is unable or unwilling to match the lower price, the University must document this in the procurement record and may proceed with the open market purchase.
E. University-Wide Contracts.The Office of Budget and Finance has established a number of University-wide Contracts, some on an exclusive basis, with vendors for certain commodities or services (“University-Wide Contracts”). The University shall make purchases from University-Wide Contracts in the following manner:
1. If no applicable Preferred Source or OGS Commodities Contract can meet the University’s form, function, and utility requirements, or where justified by price, the applicable Purchasing Department must determine whether the required commodity or service can be obtained through an existing University-Wide Contract.
2. If the University’s requirements can be met through an existing University-Wide Contract, then the University must purchase such commodities or services through the available University-Wide Contract, unless the applicable Purchasing Department makes the determination that it can obtain lower pricing from an alternate source. Any questions relating to University-Wide Contracts must be directed to the Office of Budget and Finance.
3. In some instances the Office of Budget and Finance has established University-Wide Contracts with vendors on an exclusive basis. These exclusive University-Wide Contracts are an exception to the Purchasing Hierarchy and must be used in all instances on a first-priority basis by the University unless an exception is granted by the Office of Budget and Finance.
F. Other Centralized Contracts.If no Preferred Source, OGS Commodities Contract, or University-Wide Contract can meet the University’s form, function, and utility requirements, or where justified by price, the University may make purchases of commodities and services through centralized contracts let by certain agencies and entities of the State, the City, and the Federal government. Specifically, the University may make purchases through (1) services contracts let by OGS and (2) contracts identified by the Office of Budget and Finance as having been procured by the following agencies and made available to the University: the City’s Department of Citywide Administrative Services; the City’s Department of Information Technology & Telecommunications; the Board of Education of the City of New York; the U.S. General Services Administration; and such other governmental agencies and entities as may be identified by the Office of the General Counsel and the Office of Budget and Finance (collectively, “Other Centralized Contracts”). The University shall make purchases from Other Centralized Contracts in the following manner:
1. Where no Preferred Source, OGS Commodities Contract, or University-Wide Contract can meet the University’s form, function, and utility requirements for a purchase, the applicable Purchasing Department must determine whether the required purchase can be made through any Other Centralized Contract.
2. The University must use any available Other Centralized Contracts that have been identified in writing by the Office of Budget and Finance and that can meet the University’s form, function and utility requirements.
3. When considering Other Centralized Contracts the University shall afford each available contract equal priority, and shall award to the vendor that can meet the University’s form, function, and utility requirements at the lowest price.
4. In addition, the University may make purchases using a Campus Procurement, Piggyback, or a Consortia Contract, instead of using an Other Centralized Contract, when justified by price.
G. Purchases By Campuses.If no Preferred Source, OGS Commodities Contract, University-Wide Contract, or Other Centralized Contract (collectively, “Existing Contracts”) can meet the University’s form, function, and utility requirements, or where justified by price, the University may make arrangements to purchase the needed commodities or services on its own, including, conducting its own procurement, making “piggyback” purchases through other governmental contracts, or purchasing through contracts established by purchasing consortia, as more fully described below. The options described in this Section V(G) shall be afforded equal priority.
1. Campus Procurements.If no Existing Contract is available that can meet the University’s form, function, and utility requirements, or where justified by price, the University may purchase the needed commodity or service through an individual procurement conducted by the University (a “Campus Procurement”). In conducting Campus Procurements the University may, depending on the size of the resulting purchase, use informal purchasing methods (e.g., internal research, quotes) or formal purchasing methods (e.g. competitive sealed bids or proposals).
a. Informal Purchasing Methods . When conducting a Campus Procurement, the University is generally required to use formal competitive purchasing methods such as sealed bids and sealed proposals (as further described below in Section V(G)(1)(b) below, “Formal Purchasing Methods”). However, when making purchases under certain dollar thresholds the University may use the informal purchasing methods described in this Section V(G)(1)(a) (“Informal Purchasing Methods”) in lieu of Formal Purchasing Methods. Specifically, Purchasing Departments may use Informal Purchasing Methods for general purchases that are less than $100,000, or such higher amount authorized by the State Comptroller. In addition, when award is made to a New York State small business or a New York State-certified MWBE or SDVOB, or when the University is purchasing recycled or remanufactured commodities or technology or certain food products that are grown, produced or harvested in New York State, Purchasing Departments may use Informal Purchasing Methods for purchases up to $200,000, as authorized by the State Finance Law (collectively, “Enhanced Informal Purchases”). When using Informal Purchasing Methods Purchasing Departments may make purchases from any responsive and responsible vendor whose goods or services meet the University’s form, function, and utility requirements and are offered at a reasonable price, as determined by the Purchasing Department. The University must follow generally-applicable procurement rules (including those listed in Section III) when using Informal Purchasing Methods. Informal Purchasing Methods include Purchasing Departments conducting research into products or services that meet the University’s needs, determining the reasonableness of pricing and vendor responsibility, and justifying the selection of a particular vendor in the procurement record. Purchasing Departments will determine the reasonableness of pricing as set forth below.
i. For purchases that are less than $20,000, Purchasing Departments must obtain multiple oral or written quotes, or conduct and document internal or external pricing research, or use a combination thereof. While no formal competitive processes are required, Purchasing Departments are encouraged to use competition where possible.
ii. For purchases of $20,000 or more but less than $50,000, Purchasing Departments must obtain a minimum of three written quotes from vendors.
iii. For purchases of $50,000 or more but less than $100,000 (or less than $200,000 in the case of Enhanced Informal Purchases), or up to such higher amount authorized by the State Comptroller, Purchasing Departments must obtain written quotes from vendors after publicly advertising the procurement in accordance with applicable law and University policy.
iv. The University has determined a price to be fair and reasonable if it is within 15% of the lowest current price offered from other responsive vendors or within 15% of the other current pricing indicator used by the University. In the event an award is made to a responsive and responsible vendor whose price is greater than (but within 15% of) the lowest current offered price or other current pricing indicator available, the Purchasing Department must maintain documentation in the procurement record of the rationale for the selection of the vendor.
b. Formal Purchasing Methods . The University shall use Formal Purchasing Methods for all purchases of $100,000 or more, or in excess of such higher amount authorized by the State Comptroller. Formal Purchasing Methods shall include: (i) sealed competitive bids; (ii) requests for proposals; and (iii) such other methods as may be approved by the Office of the General Counsel and the Office of Budget and Finance. In the case of sealed competitive bids, awards shall be made to the responsive and responsible vendor offering the lowest price, as determined by the applicable Purchasing Department. In the case of requests for proposals, awards shall be made on the basis of “best value” to the responsive and responsible vendor whose proposal optimizes quality, cost and efficiency, as determined by the applicable Purchasing Department and an evaluation committee. The University may reject all bids or proposals received, or make multiple awards, where the University determines that doing so shall be in its best interest.
2. “Piggyback” Contracts.If no Existing Contract is available that can meet the University’s form, function, and utility requirements, or where justified by price, the University may make purchases through contracts let by other governmental entities (a “Piggyback”) after obtaining the approval of the Office of the General Counsel and the Office of Budget and Finance and after obtaining all required external approvals.
3. Consortia Contracts.In some instances, multiple entities have agreed to purchase commodities collectively as a consortium and at lower prices than would be otherwise achievable through purchases by such entities individually. If no Existing Contract is available that can meet the University’s form, function, and utility requirements, or where justified by price, the University may make purchases of commodities from contracts let by such purchasing consortia (“Consortia Contracts”), after obtaining the approval of the Office of the General Counsel and the Office of Budget and Finance and after obtaining all required external approvals.
H. Exceptions to the Purchasing Hierarchy.In addition, the University may forgo the Purchasing Hierarchy in instances of documented sole source, single source, and emergency purchases. The University is not required to use Existing Contracts, Piggybacks, or Consortia Contracts, or follow Formal Purchasing Methods or Informal Purchasing Methods for Campus Procurements, in the following instances:
1. Emergency Contracts.In the rare case of an emergency arising out of an unforeseen occurrence or condition or situation where a threat to health, safety, life, or limb exists, or where a necessary service is threatened with material damage or suspension, or where University buildings or property are threatened, the University may authorize the award of a contract on other-than-a competitive basis. For each such procurement, there shall be a declaration of emergency and a written record setting forth the basis for concluding that there was an emergency and the abbreviated procurement methods used to identify the selected contractor. The University shall submit such declaration and record to the Senior Vice Chancellor and Chief Financial Officer and to the General Counsel, and shall promptly submit any resulting contract to the City or State, as appropriate, for payment. In all instances the applicable Vice President for Finance and Administration, or equivalent, shall make the final determination of whether an emergency procurement is appropriate.
2. Single Source.The University may authorize the award of a contract on other-than-a competitive basis, even though two or more firms can supply the required commodity or service, if the University determines that either: (a) one particular firm has unique knowledge or expertise with respect to the required commodity or service rendering the use of competitive procedures impractical; or (b) other material or substantial reasons exist for awarding the contract on other-than-a competitive basis. The University shall advertise each such procurement as required by law, and shall create and maintain a written record setting forth the basis for justifying the single source procurement, including the methods and rationale for selecting the contractor, alternatives considered and why the alternatives do not meet the University’s needs, and a determination that the vendor’s price is fair and reasonable. In all instances the Purchasing Department shall make the final determination of whether a single source procurement is appropriate.
3. Sole Source.When there is only one source for a required commodity or service, the University may authorize the award of a contract for that commodity or service on other-than-a competitive basis. The University shall advertise each such procurement as required by law, and shall create and maintain a written record setting forth the basis for justifying the sole source procurement, including the methods and rationale for selecting the contractor, a determination of exclusive capability of the vendor or product, alternatives considered, and a determination that the vendor’s price is fair and reasonable. In all instances, the Purchasing Department shall make the final determination of whether a sole source procurement is appropriate.
VI. Policy Implementation and Amendments; Effect on Awarded Contracts
A. The University shall comply with this Policy, except in instances where an exception to this Policy has been approved in writing by the General Counsel and the Senior Vice Chancellor and Chief Financial Officer, or their successors or designees.
B. The University shall comply with any procedures, manuals, memoranda, directives, and the like issued prior to or following the effective date of this Policy by either or both of the Office of the General Counsel and the Office of Budget and Finance that relate to this Policy (“Administrative Guidance”). Subject to the other provisions of this Section VI, in the event of any conflict between this Policy and any Administrative Guidance, this Policy shall govern to the extent of the conflict. This Policy supersedes and renders void the University’s Purchasing Policy Manual approved by the Board of Trustees on October 23, 1995 and as may have been
revised from time to time.
C. The General Counsel and the Senior Vice Chancellor and Chief Financial Officer or their successors may modify, supplement, or update this Policy, subject to by the Board of Trustees’ ratification, as they may deem necessary to implement changes in law, regulations, and administrative requirements, and to ensure consistency with other University policies.
D. Nothing contained in this Policy shall be deemed to (1) alter, affect the validity of, modify the terms of, or impair any contracts or agreements issued or entered into prior to the effective date of this Policy or (2) confer upon any person, firm, or corporation any right, remedy, claim, or benefit under, or by reason of, any requirement or provision hereof.
(Board of Trustees Minutes,2017,02-21,3,B)

ARTICLE III FISCAL AFFAIRS

Policy 3.041 Short-Term Investment

CITY UNIVERSITY OF NEW YORK
SHORT-TERM INVESTMENT POLICY
1. Purpose of the Short-Term Investment Policy
This Short-Term Investment Policy governs The City University of New York’s (“CUNY”) short-term investment of available cash, if any, and CUNY’s Short-Term Investment Pool (the “STIP”).
2. Background
The STIP was created to serve the short- to intermediate-term financial needs of CUNY and its Colleges and related entities, including Alumni Associations and Foundations, that choose to invest in the STIP. The STIP is a pooled investment vehicle for multiple individual accounts that includes non-tax levy funds with a short to intermediate timeframe but excludes dedicated operational cash.
Currently, CUNY and its Colleges and related entities independently invest their short- to intermediate-term funds mainly in various money market and certificate of deposit accounts at low yields without any coordination among them. Given the large aggregate size of these accounts and the scale advantages that are achievable, it is prudent to seek a higher-yielding alternative that offers an acceptable risk/return tradeoff with operational ease and a high level of transparency. It is understood that achieving higher returns requires increasing investment risk and/or reducing liquidity; however by combining multiple accounts and with proper cash flow forecasting, an acceptable balance between good returns, adequate liquidity and acceptable investment risk should be achievable.
It is the aim of the STIP to become the preferred choice for placement of the short- to intermediate-term assets.
This policy adheres to the standards of prudent management of investment assets set forth in the New York Prudent Management of Institutional Funds Act (“NYPMIFA”).
3. Responsibilities
A.CUNY’s Vice Chancellor for Budget and Finance serves as steward and is responsible for providing broad oversight of the STIP investment program, including developing objectives and strategies for the STIP consistent with the Short-Term Investment Policy and setting an optimal asset allocation. The University Controller and his Investment Staff shall perform all other responsibilities relating to the STIP.
B.The University Controller and his Investment Staff shall be responsible for the total investment program and will provide prudent oversight of the STIP in order to further the goals and mission of CUNY and the College and related entity participants. The University Controller and his Investment Staff shall be responsible for implementing the Vice Chancellor for Budget and Finance’s decisions relating to the STIP; ensuring the STIP is invested according to the Short-Term Investment Policy; administering the STIP; selecting and terminating Investment Managers; determining whether or not to engage external agents such as Investment Consultants and Custodians, and selecting and terminating any such external agents; rebalancing the STIP; presenting investment results; coordinating with any selected Investment Managers, Investment Consultant(s) and Custodian; and ensuring that CUNY’s investment and management of STIP assets comply with NYPMIFA.
In addition, the University Controller and his Investment Staff shall report at least annually to the Subcommittee on Investments of the Board of Trustees on investment policy, asset allocation and performance of the STIP as well as other substantive matters. The Subcommittee on Investments shall in turn report at least annually to the Board of Trustees on the same matters relating to the STIP.
The University Controller and his Investment Staff may delegate certain investment responsibilities to external agents such as consultants and investment managers. Such delegation must be conducted in a prudent manner and in good faith and requires at a minimum:
a) Clear definition of the scope and terms of the delegation and assessment of the reasonableness of the compensation charged by the agent;
b) Proper due diligence including assessment of the agents’ independence and potential conflicts of interest;
c) Subsequent monitoring of the delegated areas including reasonable efforts to verify accuracy of information provided by the agents; and
d) Contracts with external agents must specify that (i) they can be terminated without penalty by CUNY upon no more than 60 days’ notice and (ii) the external agent owes a duty to CUNY to exercise reasonable care, skill and caution to comply with the scope and terms of the delegation.
C.The Vice Chancellor for Budget and Finance and the University Controller and his Investment Staff must adhere to New York State ethics provisions under Public Officer Law, Sections 73 and 74.
D.Each Investment Consultant shall provide assistance to the University Controller and his Investment Staff, as requested, on the development, implementation, and ongoing practice of specific Investment Manager guidelines and practices consistent with the mandate to provide prudent oversight of the STIP. Each Investment Consultant shall also assist the University Controller and his Investment Staff with the selection of Investment Managers and provide periodic investment ideas tailored to CUNY’s specific needs as well as provide investment performance measurement and advice concerning risk management strategies, primarily through asset allocation studies and diversification strategies. Each Investment Consultant shall act as a fiduciary of the STIP.
E.Each Investment Manager shall be responsible for investing as a fiduciary with discretion the assets under its management and in reporting and communicating with the University Controller and his Investment Staff in accordance with the Short-Term Investment Policy and the applicable Investment Manager guidelines.
F.Each Custodian shall be responsible for all needs relating to the custody and accounting of the STIP assets, including processing all Investment Manager transactions, related additions or withdrawals, and securities lending (if agreed to), and reporting and communicating with University Controller and his Investment Staff, Investment Managers and Investment Consultant(s), in accordance with the Short-Term Investment Policy and with the applicable Investment Manager guidelines.
G.In carrying out their responsibilities, the Vice Chancellor for Budget and Finance, University Controller and his Investment Staff, and external agents shall comply with the duties of loyalty and care, which require each such person to act in what he or she believes is the best interest of CUNY and in good faith and with the care an ordinarily prudent person in a like position would exercise under similar circumstances.
4. Investment Objectives and Liquidity
The Investment Objective of the STIP is to provide a return greater than the return achievable through investment in common money market funds at a standard deviation that does not exceed 3%.
It is recognized that these objectives may not be achieved over shorter time periods, but should be achievable over longer periods and the objectives shall therefore be evaluated over rolling three-year periods.
The liquidity profile of the STIP must be high with at least 50% of it having daily liquidity and no more than 10% having liquidity beyond a quarter.
5. Additions and Withdrawals
Investments in the STIP are subject in all respects to the Short-Term Investment Policy and the STIP Rules attached hereto as Appendix A (the “Rules”) and as updated from time to time by the University Controller. Participants can withdraw funds from the STIP as needed in accordance with the requirements of the Rules.
Among other things, the Rules address reporting to participants, stress the need for proper cash flow forecasting of additions and withdrawals to the STIP, and require Participants to communicate requests for withdrawals in advance to facilitate rebalancing and planning, especially for larger transactions.
6. Asset Allocation and Composition of the STIP
The STIP is a commingled pool consisting of at least three separate Tiers as described below:
A. Short-Term Tier:The purpose of the Short-Term Tier is to ensure capital preservation and daily liquidity and this Tier will be invested conservatively in fixed income and cash securities with daily liquidity and shorter maturities.
B. Intermediate-Term Tier : The purpose of the Intermediate-Term Tier is to ensure capital preservation over time but with some excess return potential using predominantly daily liquidity and fixed income investments at short to intermediate maturities.
C. Long-Term Tier:The purpose of the Long-Term Tier is to provide excess return potential through a variety of investments including both equity and fixed income with varying liquidity terms and at significantly higher levels of risk than normally used in short-term cash pools, with the potential for significant gains as well as the potential for loss of capital. Specific investment guidelines for the Long-Term Tier are contained in CUNY’s Investment Policy related to the Long-Term Investment Pool, where this Tier will be co-invested.
The asset allocation among the Tiers shall be the following:
Tier, Target Allocation, Range
Short-Term, 20%, 15%-25%
Intermediate-Term, 70%, 60% – 80%
Long-Term, 10%, 5% – 15%
In establishing the asset allocation and in its implementation, the following factors shall be taken into consideration, if relevant:
o General economic conditions;
o The potential impact of inflation/deflation;
o The expected tax consequences, if any, of investment decisions or strategies;
o The role of individual investments in context of the overall STIP;
o The expected total return from income and the appreciation of investments;
o The overall resources of CUNY and College and related entity participants;
o The needs of CUNY and College and related entity participants to make distributions and preserve capital; and
o The relationship of any given investment asset to the mission/purpose of CUNY and College and related entity participants.
Also, any investment decision shall always take into account the purposes of CUNY and College and related entity participants and the funds that comprise the STIP. Investment decisions shall, furthermore, not be considered in isolation but on the basis of the total STIP. Also, as specified below, the STIP shall be diversified and implemented in a cost-effective way.
The asset allocation of the STIP shall reflect a proper balance of its investment objectives, risk tolerance and need for liquidity.
7. Rebalancing
The Tiers shall be rebalanced back to their respective targets to ensure that the asset allocation remains an accurate reflection of CUNY’s desired risk profile. The following methods shall be used: 1) rebalancing using cash inflows and outflows on a monthly basis, 2) rebalancing semi-annually in October and April and 3) rebalancing back to the target allocations should actual allocations move outside allowable ranges.
8. Investment Management
The Short- and Intermediate-Term Tiers shall be invested with one or more managers with fixed income and cash management expertise. Given the liquidity and capital preservation needs, the assumption is that these Tiers will be invested through separate account vehicles. On an exception basis, limited use of commingled vehicles is permitted if sufficient diversification cannot be achieved otherwise or significant cost savings can be achieved at an acceptable level of risk.
The Long-Term Tier will be co-invested with the CUNY Long-Term Investment Pool and therefore subject to the safeguards, manager diversification, and other requirements of CUNY’s Investment Policy related to the Long-Term Investment Pool.
9. Performance Monitoring
With the assistance of the Investment Consultant(s) and the Custodian, the University Controller and his Investment Staff shall regularly review the STIP assets, the status of its investment Tiers, and shall make such adjustments as deemed necessary to achieve stated investment objectives. In addition, the University Controller and his Investment Staff shall receive monthly performance reports primarily for administrative purposes.
A.The STIP shall be evaluated against (a) the investment objectives set forth in Section 4 above and (b) a custom benchmark consisting of a weighted mix of appropriate benchmarks for each Tier.
B.The performance of each Tier of the STIP shall be measured against Tier-specific benchmarks, which will enable evaluation of the effectiveness of the implementation strategy used for that Tier. For the Long-Term Tier the benchmark is the CUNY Long-Term Investment Pool benchmark, as it may be updated from time to time.
C.Performance reporting shall be carried out in a manner and form that enables a clear evaluation of the STIP and Investment Manager performance, both on an absolute and on a risk-adjusted basis, as described above.
10. Investment Manager Guidelines
With the assistance of the Investment Consultant(s), the University Controller and his
Investment Staff shall work with the Investment Manager(s) to create specific guidelines for each Investment Manager when it is hired and shall review and recommend changes to those guidelines as necessary.
In the exceptional event that the STIP (Short- and Intermediate-Term Tiers) invests in mutual funds and/or commingled vehicles, the Investment Manager guidelines will be contained in the offering documents. Since, in these cases, CUNY cannot impose any changes, the University Controller and his Investment Staff, assisted by the Investment Consultant(s), shall determine beforehand whether the Investment Manager guidelines contained in the offering document are acceptable and suitable for the given mandate.
Each Investment Manager shall be required to monitor compliance with its specific guidelines quarterly (or more frequently if market conditions warrant) and based on the then-current market values. Each Investment Manager shall be required to promptly communicate in writing to the University Controller and his Investment Staff any violations of the guidelines stating the nature of the violation, potential remedies, or a petition that a compliance waiver be granted setting forth the reasons therefore. The University Controller and his Investment Staff, assisted by the Investment Consultant(s) shall be responsible for enforcing this requirement.
All such Investment Manager guidelines shall incorporate the following basic principles:
A. Manager Autonomy
Decisions as to individual security selection, security size and quality, number of industries and holdings, current income level, turnover, and the other tools employed by active managers, shall be left to broad manager discretion, within the limits of any specific guidelines.
B. Leverage and Derivatives
Unless explicitly authorized, the use of leverage or speculative use of derivatives shall be prohibited unless as a means for investment managers to hedge investment risk, to hedge currency risk or replicate investment positions at a lower cost than would otherwise be created in a cash market.
C. Diversification
Each Investment Manager shall be required to diversify holdings so that the STIP is not exposed unduly to any single security issuer or sector. The Investment Manager guidelines shall set forth holding limits applicable to that Investment Manager.
D. Duty to Inform
Each Investment Manager shall be required to inform the University Controller and his Investment Staff as soon as possible if a deviation from its guidelines is anticipated and seek approval. In addition, each Investment Manager shall be required to inform the University Controller and his Investment Staff as soon as practicable of any significant change in firm ownership; acquisitions of other investment managers; changes to organizational structure; investigations or proceedings commenced by or subpoenas received from the Securities and Exchange Commission or any other regulatory or law enforcement agency; official notice of any disciplinary proceeding or litigation against the manager or any of its employees; departures of key professional personnel; changes of account structure or changes in the manager’s fundamental investment philosophy.
Each Investment Manager shall be required to propose revisions to its guidelines at any time the existing guidelines would impede meeting the investment objectives established for the Investment Manager.
E. Best Execution
Except under unusual circumstances (in which case the University Controller and his Investment Staff shall be promptly notified), each Investment Manager shall be required to enter into all transactions on the basis of best execution, which means best realized net price. Turnover should be minimized consistent with the effective implementation of the strategy.
11. Changes to the Short-Term Investment Policy
The Short-Term Investment Policy shall be in force until modified in writing and approved by the Board of Trustees. The Vice Chancellor for Budget and Finance may propose revisions to the Short-Term Investment Policy to the Board of Trustees at any time.
APPENDIX A STIP Rules CUNY Short-Term Investment Pool (“STIP”) Participant Rules
1. Purpose
These Participant Guidelines govern the relationship between CUNY and any Short-Term Investment Pool investing entity (“Participants”)
2. Deposits
Upon deposit of a Participant’s assets in the Account, the assets will be invested pro-rata on a commingled basis in the STIP and the Participant will be assigned a pro-rata share of the STIP’s total invested amount. Any Participant, with CUNY’s approval, may invest additional assets in the STIP at any time.
Even though the STIP is for non-tax levy funds and, therefore, not subject to spending rules, for each Individual Fund in a Participant’s Account, the Participant shall provide CUNY with (i) information regarding the name and purpose of the fund and any restrictions imposed on the fund; (ii) all available underlying documentation for the fund including, but not limited to, any gift instrument associated with the fund and any amendments thereto (iii) a statement of the book and market value of the fund as of the date the fund is delivered to CUNY for investment in the STIP; and (iv) a statement of anticipated cash flows (anticipated contributions and withdrawals) forecasted over the next 3 years. Especially for larger anticipated withdrawals and/or for longer-dated capital project needs, accuracy of the forecast is very important as it guides the rebalancing of tiers and helps avoid a potential liquidity mismatch.
Participants acknowledge that CUNY relies on the information and underlying documentation provided by the Participants and shall not hold CUNY liable for actions taken in reliance of such information to the extent that the information proves inaccurate or incorrect.
3. Governance, Objectives and Investment Implementation
The assets that the Participant invests in the STIP will be invested and managed pursuant to CUNY’s Investment Policy as it relates to the STIP. The Investment Policy sets out the STIP investment objectives, risks, investment implementation guidelines etc. All Participants shall be given and required to read a copy of the Investment Policy before the first deposit to the Pool. CUNY will inform the Participant of any substantive amendments to the Investment Policy.
4. Reporting to Participants and Valuation Methodology
CUNY will provide the Participant with regular performance reports for the STIP that will include a calculation of the Participant’s share of the STIP. This information will be available on the STIP’s website, which is updated on a monthly basis.
CUNY will maintain records of the individual funds (the “Individual Funds”) that comprise the Participant’s Account. Such records for each Individual Fund will reflect actual additions to and withdrawals from each such fund, transfers to and from the fund, income earned by the fund, the fund’s realized gains and losses and the fund’s book and market value.
In determining the value of securities in the STIP, CUNY will rely on the STIP’s investment managers and custodian. Readily marketable securities held by the STIP shall be valued using sources of information and pricing methods that are generally accepted by the industry.
A minor portion of the assets in the STIP will be invested in alternative investments (through the long-term tier co-invested in the CUNY long-term pool). Because these alternative investments, and the assets backing them, may not be readily marketable, valuations of these security interests may be subjective in nature. The valuation of these interests may marginally affect the value of the units it is assigned or receives when it elects to participate in or withdraw from the STIP.
5. Fee, Expense and Management Cost Sharing
The Participant’s pro-rata share of the costs and expenses of managing and administering the STIP will be allocated to the Participant’s Account. Such costs and expenses include, but are not limited to, all investment manager fees, related incentive fees; consultant fees; custodial and participant record-keeping fees; administrative fees; fees, such as legal or specialist fees when deemed necessary for compliance purposes; any other STIP-related costs and expenses. Currently, CUNY does not charge a fee for administering the STIP. CUNY will notify the Participant before initiating an administrative fee.
6. Withdrawals and Pool Participation Termination
Participants may withdraw funds from its Account by submitting to the CUNY Investment Office properly completed Withdrawal Requisition Forms, signed by two Authorized Representatives. Withdrawal Requisition Forms may be submitted by email, facsimile or overnight courier service to the CUNY Investment Office.
CUNY will endeavor to process withdrawal requests as promptly as is possible while maintaining the integrity of the STIP.
In order to ensure against a liquidity mismatch, advance notice is required for any withdrawal from the STIP as follows:
• For withdrawals less than $500,000, 2 business days.
• For withdrawal requests of $500,000 and up to $1 million, 5 business days
• For withdrawal requests for amounts above $1 million – 7 business days.
In order to advance the Financial Objectives of the STIP, Participants are encouraged to keep the total number of withdrawal requests per quarter to a minimum. Further, to be efficient and cost-effective, participants are encouraged to consolidate requests so to avoid de minimus withdrawal requests.
CUNY reserves the right to delay withdrawals partially or fully in extraordinary circumstances if such a transfer would have an adverse impact on the Participant itself or other STIP participants, such as during a financial crisis, an investment manager lockdown/gating situation or in the event of concurring extraordinarily large withdrawals from several STIP participants in a given period. At such times, CUNY will act prudently and in the best interests of all participants in the STIP in determining the time period necessary for the transfer of the Participant’s funds and will inform the Participant of the circumstances and its decision in a timely manner.
A full termination of STIP participation or one or more withdrawal requests that constitute a withdrawal of all of the Participant’s funds in its Account requires 30 days’ notice. On the last day of the notice period, CUNY will transfer the funds in the Participant’s Account, net of any applicable costs and expenses and net of the holdback described below to the Participant or a third party designated in writing by the Participant to receive such funds. CUNY may waive this and other notice periods at its discretion if it deems that doing so does not adversely impact other STIP participants. CUNY reserves the right to delay termination transfers partially or fully under the extraordinary circumstances described above.
In order to provide for equitable treatment of all participants in the STIP and given that some costs are incurred with a lag, in the case of a complete withdrawal, the STIP will retain 3 percent of the Participant’s market value for unanticipated liquidity events—whether or not due to market conditions or inaccurate/ incorrect information provided–as well as costs and expenses under Section 8 of this Agreement, which will be applied to such costs, with any difference between the amount retained and the actual costs incurred by the Participant’s account, paid or billed to the Participant within 90 days of the end of the applicable fiscal year. CUNY has the right to waive the holdback at its discretion.
(Board of Trustees Minutes,2014,06-30,3,C)

ARTICLE III FISCAL AFFAIRS

Policy 3.05 Trust and Gift Funds, Acceptance and Administration

Policy 3.05 Trust and Gift Funds, Acceptance and Administration
The Board of Trustees of the City University of New York authorizes the Chancellor and the Presidents of the colleges and schools within the University system to accept unrestricted gifts to their respective colleges and schools from individuals and donors where each such unrestricted gift does not exceed $10,000 in value. Each college and school shall be required to maintain monetary gifts in separate bank accounts designated for that purpose. In addition, the colleges shall maintain proper records of all donations and shall provide an accounting thereof at the end of each fiscal year. In the event that, at the time of accounting, the account balance at any college or school exceeds $5,000, the entire balance—less expenses for maintenance—shall be transmitted to the University Accounting Office for deposit in the University’s Investment Pool in an account maintained for the particular college or school. (BTM,1995,10-23,004,_B)

ARTICLE III FISCAL AFFAIRS

Policy 3.06 Tuition and Fee Manual

THE CITY UNIVERSITY OF NEW YORK – REVISION OF TUITION AND FEE MANUAL:
[ . . . ]
RESOLVED, That the Board of Trustees of The City University of New York approve the university’s revised Tuition and Fee Manual and authorize the Chancellery to revise the Manual as may be necessary and appropriate in the future. This Manual will serve as the University’s policy statement regarding tuition and fee matters.
(Board of Trustees Minutes,2013,06-24,3,D)

ARTICLE III FISCAL AFFAIRS

Policy 3.07 Vehicles, Use and Operation of

THE CITY UNIVERSITY OF NEW YORK
VEHICLE USE POLICY
A. Purpose and Applicability
This Policy addresses the use and operation of University vehicles. This Policy applies to all potential drivers of University vehicles and supersedes all inconsistent policies, memoranda, guidelines and protocols and similar documentation previously issued, including without limitation the 2010 CUNY Fleet Management Policy. Any deviation from this Policy requires the approval of the Chancellor or his or her designee. Any violation of this Policy may result in disciplinary action.
B. Definitions
As used in this Policy:
1. “College” means each college, school and other constituent unit of the University, including the central office.
2. “Fleet Manager” means that individual at a College who is responsible for the fleet of University vehicles at that College, including vehicle maintenance and safety and driver management.
3. “LENS Program” means the License Event Notification Service (LENS) operated by the State Department of Motor Vehicles, an automated reporting system that reviews driver’s license records of a registered organization’s drivers included in the LENS database and notifies the organization of license events, such as accidents, convictions, expirations, suspensions and revocations.
4. “Policy” means this University vehicle use policy and any amendments that may be made in the future.
5. “Presidents” means the college presidents and the deans of the Macaulay Honors College, CUNY School of Professional Studies, the CUNY School of Law, the CUNY Graduate School of Journalism, and the CUNY Graduate School of Public Health and Health Policy, each of whom is a “President.”
6. “University vehicle” means a vehicle owned, leased or rented by the University, including without limitation automobiles, buses, vans, trucks and other mobile equipment.
C. Eligibility for Use of University Vehicles
1. Any person driving a University vehicle must be a University employee or an employee of one of the following entities or types of entities related to the University, conducting University business: the Research Foundation of The City University of New York, auxiliary enterprise corporations, college associations, student services corporations, or child care centers.
2. Any person driving a University vehicle must have a valid U.S. driver’s license of the class required for the vehicle being operated and must provide a copy of the license to the Fleet Manager at their College. Any person driving a University vehicle who does not possess a New York State driver’s license must each semester provide the Fleet Manager with a copy of his or her driving record from the agency that issued the driver’s license. The University prefers, but does not require, that drivers of University vehicles have been licensed for four or more years.
3. Every person who may use a University vehicle is required to immediately inform his or her supervisor of any license revocation, suspension, or restriction. The University participates in the LENS Program. No person shall be allowed to operate a University vehicle if there has been a change in licensure that restricts driving privileges unless the operation of the University vehicle complies with such restrictions. The University retains the right to deem any person ineligible to drive a University vehicle based on driving history.
4. The University retains the right to require any person using a University vehicle to participate in a safe driving program. The program will be provided by the University at no cost to the driver and can be taken during the driver’s regular work schedule. Persons who are required to participate in a safe driving program will be allowed to continue to drive until successful completion of the program, unless the person has driving violations involving a conviction for intoxication and/or use or possession of any controlled substance, reckless driving, license suspension or failure to report an accident.
5. In the event of a suspension or revocation of the driver’s license of a University employee who is required to drive as part of his or her official duties, a College may file disciplinary charges subject to the employee’s due process rights to representation and a hearing in accordance with the disciplinary procedures of the University’s collective bargaining agreements. This Policy does not diminish a University employee’s collective bargaining rights or rights under Section 75 of the New York State Civil Service Law, as may be applicable.
D. Assignment of Vehicles
1. All University vehicles controlled by the University (i.e., not rented for a specific purpose) will be deemed part of the University’s vehicle pool. Pool vehicles will be assigned to drivers on an as-needed basis to carry out University business.
2. University vehicles may be assigned to particular individuals for their exclusive use as described in this section. Note that assignment of a University vehicle does not by itself confer the right to commute in the vehicle.
(a) University vehicles may be assigned to the Chancellor, each of the Presidents, the University Director of Public Safety, and the chief public safety official at each College, for their exclusive use. Assignments of vehicles under sections (a) and (b) do not automatically include authorization to use the vehicle for commuting purposes.
(b) University vehicles may be assigned to other University personnel only when approved by the Chancellor or his or her designee in the case of central office personnel, or the President, in the case of campus personnel. Such assignments shall be in the best interests of the University taking into consideration the efficient use and assignment of University resources, including fiscal and personnel, for the health, safety and business demands of the University.
(c) Only University personnel who are first responders, who are on call 24 hours per day, or who are responsible for ensuring public safety are allowed to routinely take University vehicles home or use vehicles for commuting purposes. The Chancellor, each of the Presidents, the University Director of Public Safety, and the chief public safety official at each College are specifically permitted to use University vehicles for commuting purposes pursuant to this paragraph.
(d) Within 30 days of the implementation of this Policy and thereafter no later than July 15 each year, each President shall provide to the central office Fleet Manager a report of the names and titles of individuals at their campus who have been assigned a University vehicle for their exclusive use for that fiscal year. The report shall indicate: (i) whether the vehicle (including any vehicle assigned to the President) may be taken home at night or used for commuting purposes or whether the vehicle will be parked at a University facility or parking space when not in use and (ii) for each job title, an explanation in support of the assignment. The Chancellor, or his or her designee, has the right to reject any assignment of a University vehicle and/or use of a University vehicle for commuting purposes that does not meet the requirements of this Section D.2.
(e) Each College shall review individual assignments of University vehicles on no less than an annual basis. If at any time the job duties change and the individual vehicle assignment is no longer warranted, such assignment shall be terminated. Any new individual assignments must be approved by the Chancellor or his or her designee in the case of central office personnel, or the President, in the case of campus personnel.
3. In circumstances where a pool vehicle is not available and a location is not easily accessible by mass transit, a College may allow persons to use a taxi, rental car or their personal vehicle, whichever is less expensive. Drivers who may be entitled to reimbursement of travel expenses should review the NYS Office of the State Comptroller Travel Manual for senior Colleges and City of New York Comptroller’s Directive #6 for community Colleges.
Notwithstanding anything to the contrary in the foregoing paragraph, participants in “CUNY Trips,” as that term is defined in the CUNY Student Domestic Trip and Travel Guidelines may use their personal vehicles for such trips except that “Trip Sponsors” and “Trip Chaperones” shall not drive students in personal vehicles on CUNY Trips unless no commercial transportation can be arranged, no pool vehicle is available, or in case of emergency. CUNY personnel who use their personal vehicles for CUNY Trips must comply with this Policy, including paragraph 4 below.
4. Drivers with physical disabilities who own specially-equipped personal vehicles are authorized to use their personal vehicles when automobile transportation is required to perform official University functions.
5. Persons who are permitted to use their personal vehicles for University business must maintain the minimum statutory automobile liability limits as required by the state in which the vehicle is registered, and must provide evidence of such insurance to the University upon request.
E. Use of University Vehicles
1. Whatever the transportation need, authorized drivers must make every effort to use mass transit in lieu of University vehicles whenever it is practicable.
2. University vehicles shall be used only for official University business except under very limited circumstances where (a) personal use such as commuting is expressly authorized pursuant to this Policy or (b) the personal use is incidental to official business. Even in cases where personal use is authorized or is incidental to official business, each person operating a University vehicle is expected to exercise good judgment to avoid the appearance of impropriety.
3. All personal use of University vehicles must be reported on the vehicle use log (see Section G of this Policy) unless the personal use is incidental to official business. For any personal use that is not incidental, the user of the University vehicle must reimburse the University the value of such use (including fuel and E-ZPass or other bridge and toll charges) or the value must be treated as imputed personal income for tax purposes. The University disseminates reporting procedures to authorized drivers annually with respect to these benefits.
4. University vehicles should not be used to transport passengers unless they are: (i) University personnel engaged in official business or (ii) non-University personnel engaged in official business with University personnel. Picking up or dropping off friends or family members at their place of employment or school in a University vehicle—regardless of their status as University personnel—is strictly forbidden.
5. Due to the public nature of the work being performed when operating a University vehicle, persons using a University vehicle have a limited expectation of privacy in connection with such use. The University expressly reserves the right to monitor and record the use of any equipment it issues or assigns for a legitimate work-related purpose, and University vehicles are no exception. Accordingly, the use of a University vehicle may be monitored and recorded at any time by visual, documentary, or electronic means.
F. Use of Drivers
A University employee may have another University employee drive the employee in a University vehicle for official business, but driving another University employee cannot be the sole or primary duty of any University employee.
G. Vehicle Use Logs
1. The Fleet Manager at each College shall maintain a vehicle use log form attached as Appendix A for all University vehicles. Such logs shall require any person using a University vehicle to record at least the following information: driver name, vehicle license plate, dates and times of use, driver and occupants of the vehicle, starting location and destination, purpose of the trip, starting and ending odometer readings, and fuel and oil purchases. Except for personal use that is incidental to official University business (see examples in Section E of this Policy), all personal use must be clearly identified as such in the vehicle use log. Drivers must sign the vehicle use log prior to removing any vehicle from its space and after returning it. Upon returning the vehicle, drivers must also note in the vehicle use log any condition(s) affecting the safety of the vehicle.
2. Each leg of a trip should be separately recorded in the vehicle use log. For example, if an employee who has an all-day meeting outside of New York City takes a University vehicle home the evening prior to the meeting, drives to the meeting the next morning, drives home that evening, and returns the vehicle the following morning, she should separately record: (a) the trip from campus to home, (b) the trip from home to the meeting, (c) the trip from the meeting back to home, and (d) the trip from home to campus to return the vehicle.
3. Vehicle use logs shall be collected, reviewed, and approved as to completeness and accuracy on a regular basis by the College Fleet Manager or designated supervisor. The frequency of such review and approval (e.g., weekly, monthly) shall be reasonable in light of the overall vehicle use by the College. The vehicle use logs shall be subject to periodic audit by the University to ensure that all vehicle use is consistent with this Policy. Vehicle use logs shall be maintained in accordance with the University’s record retention policy.
H. General Vehicle Use Requirements and Restrictions
1. University vehicles must at all times be operated in full compliance with all applicable federal, New York State, and local laws and regulations, as well as University policies and procedures.
2. Use of seat belts in University vehicles by drivers and all passengers, regardless of seating location, is mandatory.
3. No person driving a University vehicle may send or view e-mails or text messages while driving.
4. No person driving a University vehicle may use a mobile telephone or other electronic device while driving unless the mobile telephone or other electronic device is used in hands-free mode. Even hands-free use should be conducted only if it does not interfere with the safe operation of the vehicle. Because of the inherent dangers of distracted driving, all drivers are strongly encouraged to use mobile telephones and other electronic devices only while the vehicle is safely off the road and not in motion.
5. No person driving a University vehicle may use alcohol or drugs that would impair driving.
6. Possession or use of alcohol, illegal drugs, or other intoxicating substances by any person in a University vehicle is strictly prohibited.
7. Smoking in University vehicles is strictly prohibited.
8. All persons are prohibited from carrying, possessing, or transporting firearms, other weapons, or explosive devices in a University vehicle unless expressly authorized to do so in connection with carrying out their official University duties.
9. The use of radar detectors in University vehicles is strictly prohibited.
10. Except as otherwise required by traffic, weather, or road conditions, travel should be by the most direct route possible taking into consideration cost-effectiveness, actual distance traveled, and the time to travel such distance.
11. Parking permits, or placards that grant special parking privileges for University vehicles may be used only for official University business.
12. The driver of a University vehicle shall be personally responsible for all parking, moving, and E-ZPass violations.
13. Unless expressly authorized by the College, no banners, advertising, placards, decals, or stickers may be placed on a University vehicle.
14. Colleges must keep keys to University vehicles in a secure location.
I. Dissemination and Acknowledgement
Each College shall ensure that this Policy is provided on at least an annual basis to all individuals at the College who use University vehicles or may use University vehicles and that such individuals acknowledge in writing that they have received and read this Policy. Written acknowledgement by e-mail or other electronic means is acceptable. Individual acknowledgements shall be maintained on file with the College.
(Board of Trustees Minutes,2017,06-26,3,C)