TO:
Honorable Mayor and Members of the City Council
THROUGH:
Mark Danaj, City Manager
FROM:
Quinn Barrow, City Attorney
Bruce Moe, Finance Director
SUBJECT:Title
Adoption of Council Policy Regarding Management Employment Agreements; Temporary Short-Term Home Loan for Assistant City Manager (City Attorney Barrow/Finance Director Moe).
ADOPT; APPROVE; APPROPRIATE
Line
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RECOMMENDATION:
Staff recommends that the City Council: a) adopt Resolution No. 15-0064 adopting the Executive Management Employment Agreement Policy, b) approve a temporary short-term home loan for the Assistant City Manager in an amount not to exceed $2.3 million, c) appropriate $2.3 million from the General Fund, and d) authorize the City Manager to execute all documents associated with the loan, including but not limited to the promissory note, first trust deed and escrow instructions.
FISCAL IMPLICATIONS:
There are no fiscal implications associated with the adoption of the Executive Management Employment Agreement Policy.
With regard to the recommended short-term home loan, the loan is, at a minimum, cost-neutral for the City in that the interest rate charged is commensurate with the yield on the City's portfolio for short term investments plus an additional 0.5% (the loan has a maximum term of three years).
The funds to provide this short-term loan will be taken from the General Fund Economic Uncertainty Reserve (EUR) on a temporary basis. As the loan is repaid, the funds will replenish the EUR. The loan has a one-year term with two one-year options, thus the maximum possible term is three years. As a result, the EUR will be replenished within three years (or sooner) of funding the temporary loan. Staff recommends using the EUR because this is a reserve in excess of the City Council's Financial Policies reserves. The loan is expected to be fully repaid no later than the first half of 2019 (FY 2018-2019).
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