ARTICLE III. - CITY DEPOSITORIES

The city treasurer may deposit city funds in any bank or savings and loan that becomes a successor to a bank or savings and loan named in paragraph (a) of this code section.

(Ord. No. 15, § 1; Ord. No. 782, § 1, Ord. No. 907, § 1; Ord. No. 1278, § 1; Ord. No. 1735, § 1; Ord. No. 1835, § 1; Ord. No. 1951, § 1; Ord. No. 2120, § 1; Ord. No. 2137, § 1; Code 1961, § 16-5; Ord. No. 3274-85; Ord. No. 3501-86; Ord. No. 3508-86; Ord. No. 3637-87; Ord. No. 3653-87; Ord. No. 3990-89; Ord. No. 4299-92; Ord. No. 4518-93; Ord. No. 4955-96; Ord. No. 5105-98; Ord. No. 5110-98, § 1; Ord. No. 5135-98, § 1; Ord. No. 5485-00)

Sec. 2-74. - Surety bond generally; notice of withdrawal of savings accounts.

Except as otherwise provided in this article, no money shall be deposited in any bank enumerated in section 2-73, until such bank shall have executed a bond, with some guaranty or surety company authorized to do business in this state, as surety, in the penalty of at least the amount of money that is at any time on deposit in such designated depository. The condition of such bond shall be that such bank will faithfully account for and promptly pay over, when and as required or requested, whatever amount of money which may be on deposit in such bank to the credit of the city treasurer or the city, either or both, and shall indemnify the city against any loss that may be incurred by reason of the failure of such bank to honor all checks lawfully drawn on the funds in such bank or return to the city treasurer all funds of the city as and when the same may be called for; provided, however, that the bank shall have the right to require notice in writing for the withdrawal of any sums on deposit in the savings account in such bank to the credit of the treasurer or the city, either or both, provided the terms of such notice are agreed upon in writing at the time the deposit is made.

(Ord. No. 15, § 3; Code 1961, § 16-7)

Sec. 2-75. - Security in lieu of surety bond—Generally.

(a)

Any bank mentioned in section 2-73 may deposit with the treasurer, in lieu of the bond required by section 2-74, bonds of the United States of America or of this state and obligations of the City of Newport News, bonds of any city or county of this state, or farm loan bonds issued under an act of Congress, approved July 17, 1916, known as the Federal Farm Loan Act, or bonds listed for sale on the New York Stock Exchange, bonds and notes of the Federal National Mortgage Association and the Federal Home Loan Banks, debentures and other obligations of federal intermediate credit banks, or banks of cooperatives issued pursuant to acts of Congress, to be held upon the same condition and trust for the protection and indemnity of the city as is stipulated in section 2-74; provided, that such bonds shall be acceptable only at the actual value thereof, except obligations of the City of Newport News, which shall be acceptable at their par value.

(b)

Any bank mentioned in section 2-73 may deposit with the city treasurer, in lieu of the surety or other bonds designated in section 2-74 and subsection (a) of this section, notes or bonds secured by first mortgages or deeds of trust on real estate in the City of Newport News as security and indemnity for a portion of such fund so on deposit, but at no time, under any circumstances, shall the character of security provided for in this subsection be acceptable for any amount in excess of one-half (½) of the funds on deposit in any such depository. These notes and bonds shall be delivered to the city treasurer accompanied by first mortgages or deeds of trust securing the same, abstracts of titles with a certificate of title satisfactory to the city attorney, and proper insurance policies, all of which, including the value of such notes and bonds, shall be at all times acceptable and satisfactory to the city treasurer and the director of finance.

(c)

The security evidenced by notes and bonds secured by deeds of trust or mortgages and by bonds listed on the New York Stock Exchange, as provided in this section, shall, at all times, be of the value of at least ten (10) percent in excess of the amount of money for which they are accepted and held as such security, less such amount as shall be insured, by evidence satisfactory to the city treasurer, by the Federal Deposit Insurance Corporation, a corporation created pursuant to an act of Congress of the United States, approved June 16, 1933, and known as the Banking Act of 1933, and amendments thereto.

(Ord. No. 15, §§ 4—6; Ord. No. 1526, § 1; Code 1961, §§ 16-8—16-10)

Sec. 2-76. - Same—Deposit and control generally.

Whenever in section 2-75 it is provided that bonds, notes and other securities shall be deposited with the city treasurer, it shall be interpreted to mean that the securities shall be deposited with the city treasurer in the several city depositories wherein funds of the city are deposited, and the securities of such depository shall remain in the vault of such depository, under the joint control of such depository and the city treasurer. At all times, when an officer of the depository and the city treasurer shall have access to the deposit boxes, in the vault where securities are located, they shall jointly open such deposit boxes and jointly close such boxes.

(Ord. No. 15, § 11; Code 1961, § 16-15)

Sec. 2-77. - Same—Deposit under escrow agreement.

Any bank mentioned in section 2-73 may, in lieu of the bond required by section 2-74, and in lieu of the deposit of the bonds or notes secured by first mortgages or deeds of trust on real estate, as permitted under section 2-75, deposit in escrow with any bank, in or out of the state acceptable and satisfactory to the city treasurer and the director of finance, any of the bonds and notes mentioned in section 2-76, which bonds or notes so deposited in escrow shall be held by such bank in trust to secure the public funds deposits of the city in the bank so delivering such bonds or notes in escrow as herein permitted. No such bonds or notes shall be deposited in escrow until the bank so depositing and the bank so receiving the same shall have executed an escrow agreement acceptable and satisfactory to the city treasurer and director of finance and approved by the city attorney, a copy of which agreement, duly executed, shall be delivered to the city treasurer.

(Ord. No. 15, § 10; Code 1961, § 16-14)

Sec. 2-78. - Acceptable surety on bonds.

Whenever, under this article, any bond is required by or given to the city upon which surety is required, any company which shall have complied with the provisions of section 49-15 of the Code of Virginia shall be acceptable to the city as surety on such bond.

(Ord. No. 15, § 9; Code 1961, § 16-13)

Sec. 2-79. - City treasurer to be given power of attorney with respect to securities.

Every depository of city funds shall execute and deposit with the city treasurer a power of attorney or agreement authorizing and empowering the treasurer, upon default of such depository, to realize upon the obligations and securities deposited under this article, either by collection or absolute sale thereof, or otherwise and in any manner, in the discretion of the treasurer, or upon the advice of the director of finance, or under the direction of the council.

(Ord. No. 15, § 7; Code 1961, § 16-11)

Sec. 2-80. - When additional security required; withdrawal of funds not adequately secured.

Should the city treasurer at any time have in hand a sum of money belonging to the city in excess of the total of the securities as provided in this article, the treasurer shall, before depositing such sum, demand and require, from the bank in which such excess is to be deposited, that an additional bond be given or additional security be deposited to cover, as provided in this article, the amount of such excess. Should the amount of money deposited with any such depository be at any time in excess of the value of the security or securities deposited under this article, either in the treasurer's judgment or that of the director of finance or the city council, the treasurer shall forthwith withdraw from the depository such funds as may not be adequately secured.

(Ord. No. 15, § 8; Code 1961, § 16-12)

Sec. 2-81. - Securities to be insured.

Every bank wherein securities are deposited as provided by this article shall, at its own cost, insure the securities against robbery and burglary, except the securities required under section 2-77, for the full value of such securities so on deposit, such insurance policy to be approved by the city treasurer and the director of finance, and a copy thereof furnished to the city treasurer. Such insurance policy or policies shall be payable, in the event of loss of any of the securities, to the city and the bank where the securities are so deposited, as its interest may appear.

(Ord. No. 15, § 11; Code 1961, § 16-16)

Sec. 2-82. - Safe deposit boxes.

(a)

The securities and other papers of the various funds of the city under the control of the city treasurer shall be deposited in safe deposit boxes in banks located in the city. The opening and control of such safe deposit boxes and the checking and examination of such securities and other papers of the various funds of the city shall be only upon the demand, control and in the presence of the city treasurer, except as provided in subsection (b) of this section.

(b)

The director of finance or, in case of the disability or illness of the director of finance, the assistant of finance shall be present with the city treasurer or, in case of the disability or illness of the city treasurer, the chief deputy city treasurer shall be present with the director of finance at the opening of such safe deposit boxes and the check and examination of such securities and other papers of the various funds of the city.

(Ord. No. 17, §§ 1, 2; Ord. No. 694; Code 1961, § 16-4)

Secs. 2-83—2-92. - Reserved.