DATE: November 17, 2015
TO: Mayor and City Council
FROM: Director of Finance
SUBJECT
Title
Adoption of Fiscal Year 2016 Statement of Investment Policy and Delegation of Investment Authority
End
RECOMMENDATION
Recommendation
That the Council adopts the attached resolutions reaffirming the updated Fiscal Year 2016 Statement of Investment Policy and extending the delegation of investment authority to the Director of Finance.
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BACKGROUND
The City's Statement of Investment Policy (the Policy) requires that staff submit to the City Council for approval any recommended changes to the Policy. In addition, the State statutes that govern investment activity require the City Council to annually affirm the Statement of Investment Policy and to annually confirm the delegation of investment authority, which in the City of Hayward, is to the Director of Finance.
DISCUSSION
In coordination with The PFM Group (the City's portfolio management consultant), Finance Department staff have reviewed the City's Policy and recommend several minor adjustments. These changes have been reviewed by the Investment Advisory Committee and The Council Budget & Finance Committee and both bodies concur with the recommendations. The changes are summarized below and shown in a red-line version of the Policy (Attachment VI) are related to clarifying language pertaining to issuer limits and credit rating downgrades to investments after the date of purchase.
Section X. Investment Instruments: Current policy limits investments in security types such as repurchase agreements and collateralized certificates of deposit to 5%. This language contradicts issuer limits established elsewhere in the Policy. The proposed change to the Policy would limit investments to 5% by issuer "...unless stated otherwise in the Policy" removing the contradiction.
Section XII. Credit Downgrade: Proposed language is more specific in timing surrounding the dev...
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