TO:
Honorable Mayor and Members of the City Council
THROUGH:
Mark Danaj, City Manager
FROM:
Bruce Moe, Finance Director
Eden Serina, Financial Analyst
SUBJECT:Title
Annual Investment Policy (Finance Director Moe).
APPROVE
Line
_____________________________________________________________________
Recommended Action
RECOMMENDATION:
The Finance Subcommittee and City Staff recommend that the City Council approve the 2014-2015 Investment Policy, and delegate the responsibility of investing funds to the City Treasurer.
Body
FISCAL IMPLICATIONS:
There are no fiscal implications from modifying the current investment policy guidelines.
BACKGROUND:
The City's adopted Financial Policies state that the City Council shall annually review, and modify as appropriate, the City's investment policy. The Finance Subcommittee reviews and approves the policy in advance of Council review and adoption.
DISCUSSION:
At its June 24, 2014 meeting, the Finance Subcommittee reviewed and approved the recommended revisions to the City's Investment Policy. The modifications are the result of a review of the current policy by the City's investment brokers as well as City staff, and are designed to allow flexibility while maintaining safety of a diversified portfolio and provide further clarity and consistency within the document. The following substantive changes were approved by the Finance Subcommittee, and are recommended for City Council approval. Changes to the policy are shown in redline form on the draft investment policy attached.
Change under Permitted Investments per City Policy/ Permitted Instruments per City Policy Chart
The following change was made to the Federally Insured Banks & Thrifts/Time Deposits Dollar Maximum: from "None" to "amount insured including accrued interest."
Addition of terminology relating to the State Local Agency Investment Fund (LAIF) Section
The Finance Subcommittee has the authority to permit temporary deviations from policy. In the past, this authority has been applied to the 50% maximum percentage of the portfolio that can be invested in LAIF at 50%. The revised policy now authorizes the City Treasurer to exceed the 50% limit for a maximum 30 day period. The Treasurer may authorize a longer period at his discretion but will provide written notification to the Finance Subcommittee if LAIF exceeds 50% for more than 30 days.
Correction in Section X. - Internal Control
From "
control of collusion, separation of duties, separating transition authority
" to
"control of collusion, separation of duties, separating transaction authority
"
CONCLUSION:
Staff recommends that the City Council approve the revised Investment Policy.
Attachment:
1. Investment Policy 2014-2015 (redline)