Fremont City Council Meeting: 01/11/22 07:00 PM
3300 Capitol Avenue Div/Dept: Finance Department
Fremont, CA 94538 Category: Agreements and Contracts
SCHEDULED
Sponsors:
STAFF REPORT (ID # 4517) DOC ID: 4517
Updated: 1/4/2022 9:45 AM by Susan Gauthier Page 1
CALIFORNIA ASSET MANAGEMENT TRUST – Adopt a Resolution Authorizing the City to Join the California Asset Management Trust as a Participant, and to Invest in Shares of the Trust and in Individual Portfolios
Contact Persons:
Name: David Persselin
Title: Finance Director
Div/Dept: Finance Department
Phone: 510-494-4631
E-Mail: [email protected]
Executive Summary: The City currently invests a portion of its cash portfolio with the California Asset Management Program (CAMP), an investment pool for government agencies. To create an opportunity for the City to exercise approval powers over certain CAMP policies and to be represented on the board of trustees, staff is recommending that the City join the California Asset Management Trust (the “Trust”) as a participant.
BACKGROUND: CAMP is a California joint powers authority (JPA) established in 1989 to provide California public agencies with professional investment services. CAMP is directed by a board of trustees, which is made up of experienced local government finance directors and treasurers. CAMP offers a range of services to assist investors and participants with their investments. PFM Asset Management LLC provides day-to-day portfolio management and program administrative services for CAMP.
The City established an account with CAMP in January 2016 as an investor. Depending on the time of year, between 25% and 40% of the City’s investment portfolio is held in CAMP’s Cash Reserve Portfolio (the “CAMP Pool”). The CAMP Pool is a short-term money market portfolio, which seeks to preserve principal, provide daily liquidity and earn a high level of income, consistent with its objective of preserving principal. The CAMP Pool is a permitted investment for all local agencies under California Government Code Section 53601(p).
DISCUSSION/ANALYSIS: The City’s status as a CAMP investor allows the City to invest in the CAMP Pool and take advantage of CAMP’s other services. However, investors do not have a say in determining CAMP policies and are not represented on its board of trustees.
Only participant agencies which have joined the JPA and executed the CAMP Declaration of Trust are given voting rights in proportion to their investment holdings (shares).
The CAMP Declaration of Trust provides that the following matters require the approval of a majority of the holders of outstanding voting shares:
• the appointment of trustees,
• liquidation of any class of shares or participant shares series, • termination of the Trust,
• amendment of the Declaration of Trust,
• merger, consolidation or sale of assets of the Trust, Staff Report (ID # 4517) Meeting of January 11, 2022
Updated: 1/4/2022 9:45 AM by Susan Gauthier Page 2
• a change in the investment restrictions or fundamental policies set forth in the CAMP Program Guide and Information Statement, and
• such additional matters relating to the Trust as may be required by the Declaration of Trust or the By-Laws or as the trustees may consider necessary or desirable.
The Declaration of Trust also specifies that all trustees shall be members of the governing body, officers or full-time employees of California public agencies which are participants in the CAMP Trust.
As the City’s CAMP holdings represent a significant portion of the City’s investment portfolio, it could be advantageous to the City to have voting rights and eligibility to be represented on the CAMP board of trustees. Accordingly, staff recommends that the City Council adopt a resolution authorizing the City to become a participant of the California Asset Management Trust, and to invest in shares of the Trust and in individual portfolios.
FISCAL IMPACT: None.
ENVIRONMENTAL REVIEW: None required.
ATTACHMENTS:
• Draft Resolution - Asset Management Trust
RECOMMENDATION: Adopt a resolution authorizing the City of Fremont to join with other public agencies as a participant of the California Asset Management Trust, and to invest in shares of the Trust and in individual portfolios.