MLDC POLICIES
MAMAKATING LOCAL DEVELOPMENT CORPORATION
PROCUREMENT POLICY
GENERAL
MLDC: The acronym for the Mamakating Local Development Corporation.
Directors: Members of the Board of Directors of the MLDC.
For the purposes of this policy, “the value of a purchase” is defined as the total amount to be paid to a single supplier for goods and/or services where the quantity of goods and/or services purchased is reasonably expected to comprise a single deal. Splitting the quantities of a deal into multiple orders in an attempt to avoid the requisite approvals is strictly prohibited.
COMMITMENT AUTHORITY
The authority to enter into agreements to purchase goods and services on behalf of the organization has been delegated by the Board of Directors.
PURCHASING APPROVAL THRESHOLDS
The value of a purchase will determine who must approve that purchase. The authority to approve a purchase is subject to the following limits by title:
President may approve purchases up to $1,000.00
Vice-President may approve purchases up to $1,000.00
Executive Director may approve purchases up to $500.00
All other expenditures or purchases require approval of the Board of Directors in advance.
CONFLICT OF INTEREST & PROCUREMENT ETHICS
The organization requires and expects all Directors and employees who buy goods or services for the organization or may influence such buying decisions to maintain the highest standards of business ethics. All dealings with suppliers must be in the best interest of the organization. If a Director or an employee and/or his family realizes a personal benefit from a supplier as the result of having influence over a purchase of the organization, it is a clear indication of a conflict of interest. Conflicts of interest must be avoided at all times.
The following are the minimum procurement ethics standards to be followed by all Directors and employees.
Do not accept money, goods, services, or favors from suppliers in exchange for information, orders, decisions in their favor, or any other benefit.No gifts other than sundry desktop items of nominal value may be accepted by a Director or an employee or his/her family from individuals or organizations with which the employee is negotiating or does business with on behalf of the organization. While not completely prohibited, Directors and employees are cautioned against accepting promotional office supplies (e.g., pens, magnets, etc.) bearing the name of a supplier as use of such items may imply a lack of impartiality in the eyes of internal customers. Exceptions to this standard include instances in which a Director or an employee would embarrass him/herself or the organization by refusal of a gift where cultural differences preclude the individual from refusing a gift. In such circumstances, Directors or employees should advise their immediate supervisor of the gift and a suitable course of action will be determined. An example of a course of action that is generally acceptable is the distribution of those gifts to others in the organization who are not involved in decisions affecting the associated suppliers.
Accepting meals and entertainment from prospective or current suppliers is strictly prohibited. If a meeting at a third party location is appropriate, the President or Vice-President may authorize or deny the use of funds for third-party location meetings at his/her discretion. If approved, the representative of the MLDC must insist that he/she pay for his/her meals and/or entertainment and those of the supplier employee(s) involved in such meeting.
The Board of Directors may use a variety of methods for evaluating supplier proposals. One of those methods is the use of weighted average supplier scorecards. When using weighted average supplier scorecards, the evaluation criteria and their weights must be carefully determined in advance of receiving supplier proposals. The evaluation criteria and weights may only be changed after receipt of supplier proposals with the approval of the Board of Directors and, then, only after documented, legitimate, new information has been discovered during the proposal solicitation process.
Directors or Employees should not “use” prospective suppliers solely to pressure incumbent suppliers. Directors or employees should only request proposals, quotes, bids, etc. from suppliers who truly have a reasonable opportunity of winning the organization’s business.
Directors or employees should not share a supplier’s proposal details – including prices, percentage differences between their prices and other suppliers’ prices, or other terms – with another supplier unless required by law.
Directors or employees who have responsibility for, or influence over, supplier selection may not buy or hold the stock of the organization’s suppliers, except when such stock is publically traded or included in mutual funds along with the stock of many other companies.
A Director or an employee who has a relative or friend who owns, manages, or sells for a supplier with whom the organization does, or is contemplating doing, business with must disclose such relationship in writing to his/her direct supervisor and recuse him or herself from decisions involving that supplier and may not access related information unavailable to competing suppliers.
Directors or employees may only solicit charitable donations from a supplier when approved by the Board of Directors and then only after ensuring that the supplier knows that donating or declining to donate will not impact the opportunity to do business with the organization.
If a Director or an employee owns a company with whom the organization may do business with, that ownership must be disclosed in writing to the Board of Directors. That Director or employee must recuse him or herself from decisions where his or her company may be selected as a supplier and may not access related information unavailable to competing suppliers.
Under no circumstances may an employee use the time or resources of the organization to perform activities related to a personally-owned business or any other job. Employees who own businesses or work other jobs may not sell other companies’ products or services to suppliers of the organization, regardless of whether such selling would occur during or outside of the time for which the employee is being paid by the organization.
COMPETITIVE BIDDING REQUIREMENTS
All purchases whose value exceeds $10,000 may only be made after pricing is obtained from at least three (3) suppliers. All quotations, proposals, bids, etc. must be in written form so that they can be retained in accordance with the organization’s procurement records retention requirements.
NO-BID JUSTIFICATION
There are a few circumstances and items excluded from the competitive bidding requirements. Failing to anticipate needs resulting from poor planning is not an exception to this policy. Certain situations which may justify purchases without following the foregoing competitive bidding requirements are as follows:
Emergency purchases when:
Human life, health or the organization’s property is in jeopardy.
Repairs of equipment involve hidden dangers.
Repairs are immediately needed for equipment where delay would lead to higher expense.
Sole source situations, defined as situations where a product or service is available only from a certain supplier and no substitute products or services are available or compatible with the existing equipment, systems, software, etc. with which the products or services must interface.
If apparent limitations of sources of supply preclude obtaining pricing from the minimum number of suppliers and the situation cannot reasonably be considered an emergency, the Board of Directors must be contacted to assist in identifying additional suppliers or to confirm the unavailability of a sufficient number of suppliers. Final responsibility in determining whether a situation is truly a sole source situation rests with the Board of Directors.
USE OF VARIOUS PROCUREMENT PROCESSES
The organization offers several different methods of placing orders with suppliers. The following table illustrates the method of determining the proper method considering the applicable criteria.
InsuranceAny ValueApproval of Supplier Quotation by Board of DirectorsAccounting or Legal ServicesAny ValueApproval of Supplier Quotation by Board of DirectorsOther Professional ServicesAny ValueApproval of Supplier Quotation by Board of DirectorsProductsUnder $1000.00Approval per Threshold and Receipt Submitted to Board of Directors for PaymentProductsOver $1000.00Purchase Order
PROCUREMENT RECORDS RETENTION
In order to ensure that procurement is, and continues to be, done efficiently, procurement records will be audited from time to time. Therefore, all Directors or employees involved in procurement activity must comply with these records retention requirements.
The type of records that must be kept – in either digital or physical form – are supplier proposals, analysis of supplier proposals, requisitions, purchase orders, and supplier acknowledgements.
The length of time that such records should be kept is a minimum of seven (7) fiscal years.
ADOPTED BY BOARD OF DIRECTORS ON MAY 16, 2019
MAMKATING LOCAL DEVELOPMENT CORPORATION
WHISTLEBLOWER POLICY
GENERAL
MLDC: The acronym for the Mamakating Local Development Corporation.
Directors: Members of the Board of Directors of the MLDC.
POLICY: “The MLDC or its Director shall not fire, discharge, demote, suspend, threaten, harass, or discriminate against an employee because of the employee’s role as a whistleblower, insofar as the actions of the employee are legal.”
ADOPTED BY BOARD OF DIRECTORS ON AUGUST 28, 2019
MAMAKATING LOCAL DEVELOPMENT CORPORATION
INVESTMENT POLICY
GENERAL
MLDC: The acronym for the Mamakating Local Development Corporation.
Directors: Members of the Board of Directors of the MLDC.
Management: The Executive Director of the MLDC when and if one is retained.
This policy establishes investment objectives, policies, guidelines and eligible securities related to all assets held by the MLDC, and/or any of our subsidiary corporations, primarily for investment purposes. (“institutional funds”) In doing so the intent of the policy is to:
Clarify the delegation of duties and responsibilities concerning the management of institutional funds.
Identify the criteria against which the investment performance of the organization’s investments will be measured.
Communicate the objectives to the Directors, staff, investment managers, brokers, donors and funding sources that may have involvement.
Confirm policies and procedures relative to the expenditure of institutional funds.
Serve as a review document to guide the ongoing oversight of the management of the organizations’ investments.
DELEGATION OF RESPONSIBILITIES:
The Board of Directors has a direct oversight role regarding all decisions that impact MLDC’s institutional funds. The Board has delegated supervisory responsibility for the management of our institutional funds to the Finance Committee. Specific responsibilities of the various bodies and individuals responsible for the management of our institutional funds are set forth below:
Responsibilities of the Board: The Board shall ensure that its fiduciary responsibilities concerning the proper management of MLDC’s institutional funds are fulfilled through appropriate investment structure, internal and external management, and portfolio performance consistent with all policies and procedures. Based on the advice and recommendations of the Finance Committee, the Board shall:
Select, appoint and remove members of the Committee.
Approve investment policies and objectives that reflect the long-term investment-risk orientation of the endowment.
Responsibilities of the Finance Committee: Members of theFinance Committee or Board of Directors of the MLDC are not held accountable for less than desirable outcomes, rather for adherence to procedural prudence, or the process by which decisions are made in respect to endowment assets. In consideration of the foregoing, the Committee is responsible for the development, recommendation, implementation and maintenance of all policies relative to MLDC’s institutional funds an shall:
Develop and/or propose policy recommendations to the Board with regard to the management of all institutional funds.
Recommend long-term and short-term investment policies and objectives for MLDC’s institutional funds, including the study and selection of asset classes, determining asset allocation ranges, and setting performance objectives.
Determine that institutional funds are prudently and effectively managed with the assistance of management and any necessary investment consultants and/or other outside professionals, if any.
Monitor and evaluate the performance of all those responsible for the management of MLDC’s institutional funds.
Recommend the retention and/or dismissal of investment consultants and/or other outside professionals.
Receive and review reports from management, investment consultants and/or other outside professionals, if any.
Periodically meet with management, investment consultants and/or other outside professionals.
Convene regularly to evaluate whether this policy, investment activities, risk management controls and processes continue to be consistent with meeting the goals and objectives set for the management of MLDC’s institutional funds.
Responsibilities of Management: Management shall be responsible for the day-to-day administration and implementation of policies established by the Board and/or the Finance Committee concerning the management of MLDC’s institutional funds. Management shall also be the primary liaison between any investment consultants and/or other outside professionals that may be retained to assist in the management of such funds. Specifically, management shall:
Oversee the day-to-day operational investment activities of all institutional funds subject to policies established by the Board and/or the Finance Committee
Contract with any necessary outside service providers, such as: investment consultants, investment managers, banks, and/or trust companies and/or any other necessary outside professionals.
Ensure that the service providers adhere to the terms and conditions of their contracts; have no material conflicts of interests with the interests of the MLDC; and, performance monitoring systems are sufficient to provide the Finance Committee with timely, accurate and useful information.
Regularly meet with any outside service providers to evaluate and assess compliance with investment guidelines, performance, outlook and investment strategies; monitor asset allocation and rebalance assets, as directed by the Finance Committee and in accordance with approved asset allocation policies, among asset classes and investment styles; and, tend to all other matters deemed to be consistent with due diligence with respect to prudent management of institutional funds.
Comply with official accounting and auditing guidelines regarding due diligence and ongoing monitoring of investments, especially alternative investments. Prepare and issue periodic status reports to the Board and the Finance Committee.
INVESTMENT CONSIDERATIONS:
Funds will normally be held in a bank in FDIC insured checking and/or savings accounts. From time to time, the MLDC may have excess funds to invest. In that instance the following shall apply.
In accordance with the MLDC’s understanding of NYPMIFA, the Board and the Finance Committee must consider the purposes of both the MLDC and its assets in managing and investing institutional funds not projected to be used within 12 months. All individuals responsible for managing and investing the MLDC’s institutional funds must do so in good faith and with the care that an ordinarily prudent person in a like position would exercise under similar circumstances. In making any decision relative to the expenditure of institutional funds, each of the following factors must be considered, and properly documented, in the minutes or other records of the applicable decision-making body:
Short term requirements for liquid assets
General economic conditions;
Possible effect of inflation or deflation:
Expected tax consequences, if any, of investment decisions or strategies;
The role that each investment or course of action plays within the overall investment portfolio of the fund;
Expected total return from the income and appreciation of investments;
Other resources of the organization;
The needs of the organization and the fund to make distributions and preserve capital; and,
An asset’s special relationship or special value, if any, to the organization’s purposes.
GUIDELINES FOR INVESTING:
The investment goal of the funds available for investment is to achieve a total return (income and appreciation) of 5% after inflation, over a full market cycle (3-5 years). The following guidelines apply to the three main investment asset classes:
Money Market Funds: Allowable range: Minimum 5%; Maximum 45% of funds available for investment. A quality money market fund may be utilized for the liquidity needs of the portfolio whose objective is to seek as high a current income as is consistent with liquidity and stability of principal. The fund will invest in “money market” instruments with remaining maturates of one year or less, that have been rated by at least one nationally recognized rating agency in the highest category for short-term debt securities. If non-rated, the securities must be of comparable quality.
Equities: Allowable Range- Minimum 20%; Maximum 60% of funds available for investment. The equity component of the portfolio will consist of high-quality equity securities traded on the New York, NASDAQ or American Stock exchanges. The securities must be screened for above average financial characteristics such as price-to-earnings, return-on-equity, debt-to-capital ratios, etc. No more than 5% of the equity portion of the account will be invested in any one issuer. As well, not more than 20% of the equity portion of the account will be invested in stocks contained within the same industry. It is acceptable to invest in an equity mutual fund(s) adhering to the investment characteristics identified above, as long as it is a no-load fund, without 12(b)(1) charges, which maintains an expense ratio consistent with those other funds of similar investment styles as measured by the Lipper and/or Morningstar rating services.
Prohibited Equity Investments include: initial public offerings, restricted securities, private placements, derivatives, options, futures and margined transactions.
Exceptions to the prohibited investment policy may be made only when assets are invested in a Mutual Fund(s) that periodically utilizes prohibited strategies to mitigate risk and enhance return.
Fixed Income: Allowable Range- Minimum 35%; Maximum 75% of funds available for investment. Bond investments will consist solely of taxable, fixed income securities that have an investment-grade rating (BBB or higher by Standard & Poor’s and Baa or higher by Moody’s) that possess a liquid secondary market. If the average credit quality rating disagrees among the two rating agencies, then use the lower of the two as a guideline.
No more that 5% of the fixed income portfolio will be invested in corporate bonds of the same issuer. As well, not more than 20% of the fixed income portfolio will be invested in bonds of issuers in the same industry. The maximum average maturity of the fixed income portfolio will be 10 years, with not more than 25% of the bond portfolio maturing in more than 10 years.
Prohibited securities include: private placements, derivatives (other than floating-rate coupon bonds), margined transactions and foreign denominated bonds.
Exceptions to the prohibited investment policy may be made only when assets are invested in a Mutual Fund(s) that periodically utilizes prohibited strategies to mitigate risk and enhance return.
PERFORMANCE MEASUREMENT STANDARDS:
The benchmarks to be used in evaluating the performance of the two main asset classes will be:
Equities: S&P 500 Index- Goal: exceed the average annual return of the index over a full market cycle (3-5 years)
Fixed Income: Lehman Brothers Government/Corporate Index- Goal: exceed the average annual return of the index over a full market cycle (3-5 years).
It will be the responsibility of the Finance Committee of the Board of Directors to regularly review the performance of the investment account and investment policy guidelines, and report to the Board of Directors at least quarterly with updates and recommendations as needed.
Expenditure Considerations The Board of Directors and the Finance Committee responsible for the establishment of a balanced reserve fund spending policy to: (a) ensure that over the medium-to-long term, sufficient investment return shall be retained to preserve and grow its economic value as a first priority; and, (b) to provide funds for the annual operating budget in an amount which is not subject to large fluctuations from year-to-year to the extent possible.
EXPENDITURE OF INSTITUTIONAL FUNDS:
All decisions relative to the expenditure of institutional funds must assess the uses, benefits, purposes and duration for which the institutional fund was established, and, if relevant, consider the factors:
The duration and preservation of the institutional fund;
Purposes of the MLDC and the fund;
General economic conditions;
Possible effect of inflation or deflation;
Expected total return from income and appreciation of investments;
Other organizational resources;
All applicable investment policies; and
Where appropriate, alternatives to spending from the institutional fund and the possible effects of those alternatives. For each decision to appropriate institutional funds for expenditure, an appropriate contemporaneous record should be kept and maintained describing the nature and extent of the consideration that the appropriate body gave to each of the stipulated factors.
DONOR RESTRICTIONS:
In all instances, donor intent shall be respected when decisions are rendered concerning the investment or expenditure of donor restricted funds. If a donor, in the gift instrument, has directed that appreciation not be spent, the MLDC shall comply with that directive and consider it when making decisions regarding the management and investment of the fund. Any attempt to lift restrictions on any fund shall be conducted in full compliance with the law.
RESERVE FUND EXPENDITURES:
The nonprofit is authorized to withdraw funds from the invested funds as needed. The decision to withdraw funds and the amount to be withdrawn shall rest with the Board of Directors of the MLDC.
ADOPTED BY THE BOARD OF DIRECTORS ON MAY 16, 2019
MAMAKATING LOCAL DEVELOPMENT CORPORATION
CONFLICT OF INTEREST POLICY
GENERAL
MLDC: The acronym for the Mamakating Local Development Corporation.
Directors: Members of the Board of Directors of the MLDC.
Governance Committee: The Board of Directors shall serve as the Governance Committee
POLICY:
A conflict of interest is a situation in which the financial,familial, or personal interests of a director or employee come into actual or perceived conflict with their duties and responsibilities with the Authority. Perceived conflicts of interest are situations where there is the appearance that a board member and/or employee can personally benefit from actions or decisions madein their official capacity, or where a board member or employee may be influenced to act in a manner that does not represent the best interests of the authority. The perception of a conflict may occur if circumstances would suggest to a reasonable person that a board member may have a conflict. The appearance of a conflict and an actual conflict should be treated in the same manner for the purposes of this Policy.
Board members and employees must conduct themselves at all times in a manner that avoids any appearance that they can be improperly or unduly influenced, that they could be affected by the position of or relationship with any other party, or that they are acting in violation of their public trust. While it is not possible to describeor anticipate all the circumstances that might involve a conflict of interest, a conflict of interest typically arises whenever a director or employee has or will have:
A financial or personal interest in any person, firm, corporation or association which has or will have a transaction, agreement or any other arrangement in which the authority participates.
The ability to use his or her position, confidential information or the assets of the authority, to his or her personal advantage.
Solicited or accepted a gift of any amount under circumstances in which it could reasonably be inferred that the gift was intended to influence him/her, or could reasonably be expected to influence him/her, in the performance of his/her official duties or was intended as a reward for any action on his/her part.
Any other circumstance that may or appear to make it difficult for the board member or employee to exercise independent judgment and properly exercise his or her official duties.
No employee may engage inoutside employment if such employment interferes with his/her ability to properly exercise his or her official duties with the authority.
PROCEDURES
Duty to Disclose: All material facts related to the conflicts of interest (includingthe nature of the interest and information about the conflicting transaction) shall be disclosed in good faith and in writing to the Governance Committee and/or the Ethics Officer. Such written disclosure shall be made part of the official record of the proceedings of the authority.
Determining Whether a Conflict of Interest Exists: The Governance Committeeand/or Ethics Officer shall advise the individual who appears to have a conflict of interest how to proceed. The Governance Committee and/or Ethics Officer should seek guidance from counsel or New York State agencies, such as the Authorities Budget Office, State Inspector General or the Joint Commission on Public Ethics (JCOPE) when dealing with cases where they are unsure of what to do.
Recusal and Abstention: No board member or employee may participate in anydecision or take any official action with respect to any matter requiring the exercise of discretion, including discussing the matter and voting, when he or she knows or has reason to know that the action could confer a direct or indirect financial or material benefit on himself or herself, a relative, or any organization in which he or she is deemed to have an interest. Board members and employees must recuse themselves from deliberations, votes, or internal discussion on matters relating to any organization, entity or individual where their impartiality in the deliberation or vote might be reasonably questioned, and are prohibited from attempting to influence other board members or employees in the deliberation and voting on the matter.
Records of Conflicts of Interest: The minutes of the authority’s meetings during which a perceived or actual conflict of interest is disclosed or discussed shall reflect the name of the interested person, the nature of the conflict, and a description of how the conflict was resolved.
Reporting of Violations: Board members and employees should promptly report any violations of this policy to his or her supervisor, or to the public authority’s ethics officer, general counsel or human resources representative in accordance with the authority’s Whistleblower Policy and Procedures.
Penalties: Any director or employee that fails to comply with this policy may be penalized in the manner provided for in law, rules or regulations.
ADOPTED BY BOARD OF DIRECTORS ON JANUARY 9, 2020