ALP 6

• Such securities must be actually delivered to the Authority or to a third -party
custodian or third -party trustee for safe keeping on behalf of the Authority.
f. Money market funds authorized by Colorado statutes and rated in the
highest rating category by one or more nationally recognized organizations that
regularly rate such obligations.
g. Local government investment pools organized pursuant to C.R.S. 24 -75-
703.
• The trust must have assets of five hundred million dollars ($500,000,000) or
more and
• Must be rated in the highest rating category by one or more NRSRO's that
regularly rate such funds.
h. Alternative Investments — Unless approved by the Board, the Authority is
prohibited from investing in alternative investments (i.e., investments for which a
readily determinable fair value does not exist).
VII. Investment Parameters
1. Diversification
The investments shall be diversified by:
• Limiting investments to avoid over concentration in securities from a specific
issuer or business sector (excluding U.S. Treasury securities),
• Limiting investment in securities that have higher credit risks,
• Investing in the Colorado State Treasurer's Investment Pool that has varying
maturities, and
• Investing a portion of the portfolio in readily available funds such as local
government investment pools (e.g. COLOTRUST) or qualifying money
market funds to ensure that appropriate liquidity is maintained in order to
meet ongoing obligations.
2. Maximum Maturities
To the extent possible, the Authority shall attempt to match its investments with
anticipated cash flow requirements. Unless approved by the Board, the Authority will
not directly invest in securities maturing more than five (5) years from the date of
purchase or in accordance with Colorado statutes.
Bond debt service reserve funds may contain investments with terms similar to the bonds
secured. For specific programs, the Board approves these long -term investments
pursuant to certain bond resolutions. The investments normally have partial, annual
maturities over a period of approximately 20 years. The income generated from these
investments provides the loan interest subsidy to borrowers pursuant to a predetermined
cash flow model that may span 20 or more years.
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Approved and Adopted December 1, 2006