SUPPLEMENTAL REPORTS & COMMUNICATIONS
Office of the City Clerk
City Council of the City of Napa
Regular Meeting
November 7, 2023
FOR THE CITY COUNCIL OF THE CITY OF NAPA
AFTERNOON SESSION:
SUBMITTED PRIOR TO THE CITY COUNCIL MEETING
4. PUBLIC COMMENT:
1) Email from Maureen Trippe and Joyce Stavert received November 4, 2023.
6. ADMINISTRATIVE REPORTS:
6.A. Outside Water Service to Vintage High Farm Site
• PowerPoint Presentation from Staff.
6.B. Equal Employment Opportunity Annual Report, and Equity and Inclusion Plan – 2002/2023 • PowerPoint Presentation from Staff.
6.C. Treasurer’s Quarterly Investment Report on the City’s Investment Portfolio for the Quarter Ended September 30, 2023.
• PowerPoint Presentation from Staff.
From:
Maureen Trippe
To:
Clerk
Cc:
Bernie Narvaez
;
Joyce Stavert
;
Liz Alessio
;
Mary Luros
;
Scott Sedgley
;
Steve Potter
;
Beth Painter
Subject:
Please include in City Council Agenda packet11/7
Date:
Saturday, November 4, 2023 1:46:13 PM
[EXTERNAL]
Please include this in the agenda packet for City Council Meeting on November 7th. It is a link to the Letter to the Editor from Maureen Trippe and Joyce Stavert.
Napa Has Lost Its Way On Traffic Issues
https://napavalleyregister.com/opinion/letters/letter-napa-has-lost-its-way-on-traffic- issues/article_0887f782-7365-11ee-9aa7-df23c4c4e1ed.html We invite each Council Member to give us feedback on the concerns we have outlined.
Feedback by email would be ideal.
Thanks,
Maureen and Joyce
Joyce Stavert
Maureen Trippe
Item 4. Public Comment
November 7, 2023 Agenda Item 6A
1 Outside Water Service to
Vintage High School Culinary
and Agricultural Facility
City Council Regular Meeting
11/7/2023
Supplemental - Item 6.A.
From: City Staff
End of Trower Avenue
Northeast of Vintage High School
Project Site
2 NVUSD is replacing existing agricultural facility at Vintage High
Educational and Ag buildings, a working vineyard, and agricultural land
Provide access to technical education in agriculture, food, natural resources, and hospitality and tourism.
Part of school programming and limited to existing
students.
Project
3 Requesting 3” Commercial Water Service and 8” Fire
Water Service for the Project
Project is on portion of parcel (highlighted) that is outside Rural Urban Limit Line (RUL) and Sphere of Influence (SOI) Charter Section 180 allows water service outside RUL for public school facilities
Request and Constraints
4 Per Government Code
Section 56133, parcel
must be in City’s SOI
unless there is a threat to
public health and safety
NVUSD has submitted
request to LAFCO to
modify City SOI
If Water Services are approved by Council, a
Declaration of Covenants and Agreement
Regarding Water Service would be executed with
NVUSD and include terms and conditions covering
the following items:
Water Services
Right-of-Way
Street Improvements
Deed Restriction on Unused Land for
Affordable Housing
Proposed Terms
5 Water service for project only
Extend City water main and install services
Pay all applicable fees
Proposed Terms – Water Services
6 Dedicate property for an 84’ right-of-way for future extension of Trower Avenue
Property dedicated at no cost to City
Proposed Terms – Right-of-Way
7 Construct a portion of future Trower Avenue
Enter into Maintenance Agreement where NVUSD
will maintain improvements
Construct Improvements at no cost to City
Proposed Terms – Street Improvements
8 NVUSD shall execute a deed restriction on the
unused portion of the Property south of the
future Trower Avenue extension (highlighted)
restricting its use for NVUSD non-residential
facilities or future affordable housing
Proposed Terms – Land for Housing
9 Recommended Action
10 Adopt a resolution:
(1) supporting Napa Valley Unified School District’s application to the Local Agency Formation Commission of Napa County to amend the City’s sphere of influence to include the northern portion of 1130 Trower Avenue (Assessor Parcel Number 038-040- 020);
(2) authorizing the Utilities Director to execute a Declaration of Covenants and Agreement Regarding Water Service with the Napa Valley Unified School District to provide water service to 1130 Trower Avenue (Assessor Parcel Number 038-040-020) for the Vintage High School Culinary and Agricultural Facility; (3) authorizing the Utilities Director to submit an application to the Local Agency Formation Commission of Napa County for an outside service agreement; and
(4) determining that the actions authorized by this resolution were adequately analyzed by a previous CEQA action or are exempt from CEQA.
Equity & Inclusion Plan
2023
City Council Regular Meeting
11/7/2023
Supplemental - Item 6.B.
From: City Staff
Purpose
Attracting and retaining
highly skilled employees is
paramount to the City of
Napa’s success. The long-
term success of the City is
predicated on a workforce of
highly competent, motivated
people whose behavior
exemplifies the stated values
of the organization. In order
to ensure the City attracts,
hires and retains a high
quality workforce, the City
has developed equity and
inclusion objectives outlined
in this document.
2022 Accomplishments
2022 Accomplishments
Successful continuation of DEI Training program
~100% employee participation in Year-2
Executive Team coaching sessions
Completed 98 competency-based recruitments (69 full-time) Increased community outreach and participation in local recruitment events
Enhanced recruitment advertising - Print, Online, Radio, Outdoor, Transit Implemented tools to mitigate the impact of bias during the application screening process
Completed first Employee Engagement Survey in 2022
Completed two Wellness Challenges in 2022 - “Spring Into Motion” and “Feel Like a Million” which received statewide recognition at CalCities Annual Conference
Held first Mid-Manager Retreat, since COVID-19
Expansion of Buddy Program
Current Objectives
1) 100% Citywide completion
DEI Year-3 employee training
2) Conduct 2nd Citywide
Employee Engagement Survey
and complete at least one
resulting action item
3) Offer more training
opportunities for new
Managers + Supervisors, as
well as all City employees
4) Implement innovative
recruitment/retention
initiatives
Current Objectives
Enhancing the
City of Napa
Employment Brand
Talented employees reflecting the community
Inclusive Training
Government Alliance on Race and
Equity (GARE) Training
Specialized DEI Training –
Managers & Supervisors
Culture Program
The Why
Communicates
purpose of the
organization
Guides
organizational
culture
Informs strategy
development
Describes our
identity as an
employer
Mission Statement
MISSION
STATEMENT
Core Values
CORE VALUES
Integrity
Consistently demonstrating the highest level of
ethical conduct with accountability and pride.
Service
Engaging in meaningful work to care for our
community through resourceful dedication and
humble actions.
Inclusion
Creating a sense of ease and belonging through
respect, acceptance, and mindfulness of our
collective diversity.
Collaboration
Working together with a shared purpose while
respectfully considering all voices to achieve
common goals, solutions, and greater outcomes.
Inclusive Recruiting
City of Napa Employee Diversity
City of Napa Population * 2021
Employees
2022
Employees
Race % % %
Asian 2.80% 3.31% 4.82%
Black/ African
American 0.70% 1.42% 1.83%
Hispanic/ Latinx/
Latine/ Latin(o/a) 39.90% 23.64% 25.00%
Native American or
Alaskan Native 0.60% 1.42% 1.38%
Native Hawaiian/
Pacific Islander 0.01% 0.00% 0.00%
Other/ Multi-Ethnic 6.60% 2.84% 1.83%
White 53.0% 67.38% 63.76%
*Data Source: 2020 U.S Census Bureau
Moving Forward
The employees at the City of Napa are
inspired to serve our community. As we
harness the strength of our unique set of
experiences, perspectives, skills and
ideas, we will maximize opportunities to
discover and leverage our talents to
benefit the residents we serve.
The City of Napa is an Equal Opportunity Employer,
and we believe that a diverse, equitable and inclusive
workplace will maximize our talents to benefit the
residents we serve.
Ensuring that all employees and job applicants for employment are protected by federal, state and local laws designed to protect employees and job applicants from discrimination on the basis of race/ethnicity, religion, color, sex (including pregnancy, gender identity, and sexual orientation), parental status, national origin, age, disability, family medical history or genetic information, political affiliation, military service, or other non-merit based factors. These protections extend to all management practices and decisions, including recruitment and hiring practices, appraisal systems, promotions, training and career development programs.
PFM Asset Management LLC
NOT FDIC INSURED : NO BANK GUARANTEE : MAY LOSE VALUE
pfmam.com
City of Napa
Investment Program Update
Presentation to the City Council
415
-
393
-
7270
For Institutional Investor or Investment Professional
Use Only
–
This material is not for inspection by,
distribution to, or quotation to the
general public
November 7, 2023
Monique Spyke, Managing Director
City Council Regular Meeting
11/7/2023
Supplemental - Item 6.C.
From: City Staff
▸ U.S. economy has been characterized by:
▹ High inflation. Peaked at 9.1% in June 2022 and, while now at 3.7%, is still above the Fed’s 2% target.
▹ Stronger than expected GDP. A recession in 2023 appeared likely at the start of the calendar year, but growth for the first three quarters has been relatively strong.
▹ Resilient labor market. Unemployment rate below 4% since February 2022. ▹ Headwinds exist. Higher energy prices, elevated geopolitical risks, high inflation, and reduced consumer savings, could lead to a recession in the next year. ▸ Fed has hiked rates over 500 basis points (5.00%) since March 2022. ▹ For 10 consecutive meetings the Fed raised the target rate, bringing it from
0.00% to 0.25% to its current range of 5.25% to 5.50%.
▹ Potential for one additional rate hike in 2023.
▹ Market currently has a “higher-for-longer” mindset.
▸ Interest rates are at their highest levels since 2006-07. ▹ Yield curve is inverted.
▹ Higher yields present great opportunities for City’s future earnings. ▹ Increase in rates has negatively impacted market values.
Market Themes
1 Treasury Yields Higher; Curve Inverted
2Source: Bloomberg as of September 30, 2023.
0%
1%
2%
3%
4%
5%
6%
2-Year Treasury Yield
September 30, 2006 - September 30, 2023
17-Year Average:
1.47%
5.04%
0%
1%
2%
3%
4%
5%
6%
3 M
1 Y
2 Y
3 Y
4 Y
5 Y
10 Y
30 Y
Maturity
U.S. Treasury Yield Curve
September 30, 2023 March 31, 2023
City of Napa’s Investment Objectives
City’s investment policy. 3
Safety
• High quality
investments
• Diversification by
sector, issuer,
and maturity
• Management of
credit and market
risk
Liquidity
• Cash flow
coordination with
the City
• Allocation to
overnight funds
Return on
Investment
• Duration
management
• Active trading
and continual
evaluation of
relative value
among allowable
sectors
City of Napa’s Portfolio
As of September 30, 2023. Total funds includes PFMAM-managed funds and the City’s balances in LAIF and the CAMP Pool. CAMP Pool is managed by PFMAM. 4
Liquid
Funds
Core
Funds
(PFMAM-
Managed)
$0
$50
$100
$150
$200
$250
Millions
City's Total Funds
4%
14%
29%
27%
26%
0%
10%
20%
30%
0-1 Year 1-2 Years 2-3 Years 3-4 Years 4-5 Years
Maturity Distribution of Core Funds
City of Napa’s PFMAM-Managed Portfolio
5 Ratings by Standard & Poor’s as of September 30, 2023. Securities in the City's portfolio are in compliance with California Government Code and the City's investment policy. Portfolio information excludes overnight funds, including LAIF and the CAMP Pool. Accrued interest is excluded.
Securities not rated (NR) or rated BBB+ by S&P are rated A-, or the equivalent, or better by Moody’s and/or Fitch.
Credit Quality
Sector Allocation and Policy Compliance
▸ Portfolio is of high credit quality and well diversified.
Market Value
As of September 30, 2023
Percent
of
Portfolio
Permitted
by Policy
U.S. Treasuries $65,946,182 34% 100%
Federal Agencies $4,684,525 2% 100%
Federal Agency CMBS $28,530,939 15% 100%
Supranationals $2,766,996 1% 30%
Municipals $8,195,001 4% 100%
Asset-Backed Security $27,260,804 14% 20%
Corporate Notes $49,393,100 26% 30%
Negotiable CDs $5,099,788 3% 30%
Total $191,877,334
NR
4%
BBB+
2%
AAA
14%
AA
59%
A
21%
Active Management to Maintain Duration and
Capture Higher Yields
6Based on principal proceeds of sells, maturities, and purchases. ($80) ($60) ($40) ($20) $0 $20 $40 $60
Corporate Note
Asset-Backed
Negotiable CD
Municipal
Supranational
Agency MBS
Federal Agency
U.S. Treasury
Millions
Summary of Portfolio Activity
October 2022 – September 2023 Net Activity
(millions)
-$48.1
-$4.1
+$27.0
-$0.8
-$1.3
+$5.8
+$14.9
+$10.2
Sell/Maturity Buy
Yield at Market
5.15%
0%
1%
2%
3%
4%
5%
6%
Portfolio Yields
September 2013 - September 2023
Portfolio Earnings Increasing
7As of September 30, 2023. PFMAM managed portfolio only and excludes overnight funds including LAIF and the CAMP Pool. +2.21%
$0.50
$0.47
$0.52 $0.53
$0.62
$0.75
$0.81
$1.03
$1.24
$1.56
$0.0
$0.4
$0.8
$1.2
$1.6
$2.0Millions
Quarterly Interest Earnings
Yield at Cost
3.23%
Long-Term Portfolio Performance Remains
Positive
Interest earned calculated as the ending accrued interest less beginning accrued interest, plus net interest activity.
Returns are presented on an annualized basis.
The portfolio’s benchmark is the ICE BofAML 1-5 Year U.S Treasury/Agency Index. Source: Bloomberg. ▸ While sharply rising interest rates have had a negative impact on the portfolio’s market values, the portfolio continues to perform well versus its benchmark, the 1-5 Year U.S. Treasury/Agency index.
▸ Portfolio outperformance can be attributed to the portfolio’s diversification and duration management.
8 Market Value Basis Earnings Past 1 Year Past 5 Years Past 10 Years Interest Earned $4,629,231 $14,366,621 $21,277,167
Change in Market Value $659,479 ($9,223,641) ($11,819,544) Total Dollar Return $5,288,710 $5,142,980 $9,457,623
Total Return
City of Napa 2.70% 1.29% 1.17%
Benchmark 2.14% 0.93% 0.83%
Difference +0.56% +0.36% +0.34%
As of September 30, 2023
Outlook
9 ECONOMY AND INTEREST RATES
▸ Strong labor market and wage growth
▸ Inflation stuck at 3% - 3.5% significantly over the Fed’s 2% target
▸ U.S. consumer favors services yet spending less as we approach the holidays
▸ Federal Reserve continues to fight inflation, anticipate one more rate hike in 2023
▸ Increased risk of recession due to decreased consumer spending, higher energy prices, and manufacturing
slump
PORTFOLIO STRATEGY
▸ Continued focus on safety and liquidity
▸ Maintain broad diversification by sector, industry, and issuer
▸ Evaluate all opportunities to safely add value to the portfolios
Disclaimer
Investment advisory services are provided by PFM Asset Management LLC (“PFMAM”), an investment adviser registered with the U.S. Securities and Exchange Commission and a subsidiary of U.S. Bancorp Asset Management, Inc. (“USBAM”). USBAM is a subsidiary of U.S. Bank National Association (“U.S.
Bank”). U.S. Bank is a separate entity and subsidiary of U.S. Bancorp. U.S. Bank is not responsible for and does not guarantee the products, services or performance of PFMAM.The information contained is not an offer to purchase or sell any securities. Additional applicable regulatory information is available upon request.
For more information regarding PFMAM’s services please visitwww.pfmam.com.
Disclaimer
10