1 STAFF REPORT
DATE: May 23, 2023
TO: Honorable Mayor and Council Members
FROM: Krystle Ang Palmer, City Treasurer
SUBJECT: Approval of the 2023 City of Burbank Investment Policy
RECOMMENDATION
Approve the 2023 Investment Policy as proposed.
BACKGROUND
As part of the City Council’s annual review of the City’s Statement of Investment Policy and, in accordance with the requirements of the Cal ifornia Government Code, the City Council must vote to adopt the City’s Statement of Investment Policy, inclusive of amendments, on an annual basis.
DISCUSSION
Aside from date, name, and other minor changes, the following proposed changes to the Policy are worth noting (page numbers listed refer to pages of the Investment Policy):
• Page 3, Section C: Maturity
o Added language from the California state code, clarifying that “ an investment’s term or remaining maturity shall be measured from the settlement date to final maturity. Investments shall not have a forward settlement date exceeding 45 days from the time of investment.” • Page 6, Section M: Joint Powers Authority Pool
o The list of authorized investments was updated to include Joint Powers Authority Pools. To be eligible under this section, the joint powers authority issuing the shares shall have retained an investment adviser that meets all of the listed criteria. The maximum for this type of investment is 25%.
CITY
TREASURER
2 • Page 16, Exhibit A: Liquidity
o The liquidity calculation was updated to reflect numbers from the 202 2-23 budget. The necessary liquidity for 202 3, calculated at $ 115 million, increased from $101 million in 2022.
• Page 18: Exhibit C: List of Qualified Brokers from which the City May Purchase Investments
o Susan Munson will be the City’s new contact at Cantor Fitzgerald instead of Ben Finkelstein from the same firm. With this change, she completed an updated Broker-Dealer Questionnaire from the City of Burbank. She also submitted her firm’s most recent financial statements which were reviewed by the City Treasurer’s Office. She has extensive industry experience and is active in industry education through her participation in FIA (Fixed Income Academy), CMTA (California Municipal Treasurers Association), CACCTTC (California Association of County Treasurers and Tax Collectors) and GIOA (Government Investment Officers Association).
o Staff recommends that Mike Avery from Insperex and Mark Kreymer from UnionBanc Investment Services be added to the approved broker list. Staff received applications from eight brokers this year and while all brokers had something unique to offer, Mike Avery and Mark Kreymer were selected based on their experience working with other local municipalities in California and the financial stability of their firms. They both have excellent references who have confirmed they provide competitive pricing and personalized service.
This report was discussed by the Treasurer’s Oversight Review Committee (TORC) and the Fiscal & Treasurer’s Review Group (F&TRG). The TORC members are:
• Darin Guggenheimer, CEO, Gain Federal Credit Union
• Norelyn Kurasz, former CEO, Cedar Sinai Federal Credit Union • Richard Martin, CPA
• Scott Rife, retired Senior Vice President, Boston Private Bank and Trust • David Escobar, First Vice President, UBS Financial Services
The F&TRG members are:
• Mayor Konstantine Anthony
• Council Member Zizette Mullins
• City Manager Justin Hess
• Assistant City Manager Judie Wilke
• Financial Services Director Jennifer Becker
• Chief Financial Officer of Burbank Water & Power Joe Lillio
3 ENVIRONMENTAL REVIEW
This activity has no potential for resulting in either a direct physical change in the environment, or a reasonably foreseeable indirect physical change in the environment, and as such, is not a “project” subject to the requirements of the California Environmental Quality Act (CEQA) 14 Cal. Code Regs § 15378.
FISCAL IMPACT
None.
CONCLUSION
The 202 3 Investment Policy as proposed complies with the current State statutes governing the investment practices of local government entities located within the State of California and should be adopted by City Council.
ATTACHMENT
Attachment 1 – Proposed 2023 Investment Policy
Attachment 2 – Proposed 2023 Investment Policy (Redline)