Glossary of Terms
Accrued Interest: Interest earned but not yet received.
Active Deposits: Funds which are immediately required for disbursement.
Amortization: An accounting practice of gradually decreasing (increasing) an asset's book value by spreading its depreciation (accretion) over a period.
Annual Comprehensive Financial Report (ACFR): The official annual financial report for public sector entities/companies. It includes five combined statements and basic financial statements for each individual fund and account group prepared in conformity with Generally Accepted Accounting Principles (GAAP).
Arbitrage: Transactions by which securities are bought and sold in different markets at the same time for the sake of the profit arising from a yield difference in the two markets.
Asked Price: The price a broker/dealer offers to sell securities.
Average Life: The average length of time that an issue of serial bonds and/or term bonds with a mandatory sinking fund features is expected to be outstanding.
Bankers’ Acceptance (BA): A draft or bill of exchange accepted by a bank or trust company. The accepting institution guarantees payment of the bill, as well as the issuer.
Basis Point: One basis point is one hundredth of one percent (.01).
Bid Price: The price a broker/dealer offers to purchase securities.
Bond: A financial obligation for which the issuer promises to pay the bondholder a specified stream of future cash flows, including periodic interest payments and a principal repayment.
Book Entry: The system maintained by the Federal Reserve, by which most money market securities are delivered to an investor’s custodial bank. The Federal Reserve maintains a computerized record of the ownership of these securities and records any changes in ownership corresponding to payments made over the Federal Reserve wire (delivery versus payment.)
Book Value: The value at which a debt security is shown on the holder's balance sheet.
Book value is acquisition cost less amortization of premium or accretion of discount.
Broker: A broker brings buyers and sellers together for a commission paid by the initiator of the transaction or by both sides; he does not take a position. In the money market, brokers are active in markets in which banks buy and sell money and in interdealer markets.
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Callable Bond: A bond issue in which all or part of its outstanding principal amount may be redeemed before maturity by the issuer under specified conditions.
Call Price: The price at which an issuer may redeem a bond prior to maturity. The price is usually at a slight premium to the bond's original issue price to compensate the holder for loss of income and ownership.
Call Risk: The risk to a bondholder that a bond may be redeemed prior to maturity.
Cash Sale/Purchase: A transaction which calls for delivery and payment of securities on the same day that the transaction is initiated.
Certificate of Deposit (CD): A time deposit with a specific maturity evidenced by a Certificate. Large-denomination CDs are typically negotiable.
Collateral: Securities, evidence of deposit or other property, which a borrower pledges to secure repayment of a loan. Also refers to securities pledged by a bank to secure deposits of public monies.
Commercial Paper: A short-term, unsecured, and negotiable promissory note with a fixed maturity of no more than 270 days. By statute, these issues are exempt from registration with the U.S. Securities and Exchange Commission.
Convexity: A measure of a bond's price sensitivity to changing interest rates. A high convexity indicates greater sensitivity of a bond's price to interest rate changes.
Coupon: The annual rate of interest that a bond's issuer promises to pay the bondholder on the bond's face value.
Credit Analysis: A critical review and appraisal of the economic and financial conditions or of the ability to meet debt obligations.
Credit Risk: The risk to an investor that an issuer will default in the payment of interest and/or principal on a security and a loss will result.
Current Yield: The interest paid on an investment expressed as a percentage of the current price of the security.
Custodian: A bank or other financial institution that keeps custody of stock certificates and other assets.
Dealer: A dealer, as opposed to a broker, acts as a principal in all transactions, buying and selling for his or her own account.
Debenture: A bond secured only by the general credit of the issuer.
Defeased Bond Issues: Issues that have sufficient money to retire outstanding debt when due so that the agency is released from the contracts and covenants in the bond document.
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Delivery versus Payment: There are two methods of delivery of securities: delivery versus payment and delivery versus receipt (also called free delivery). Delivery versus payment is delivery of securities with an exchange of money for the securities. Delivery versus receipt is delivery of securities with an exchange of a signed receipt for the securities.
Derivative: Securities that are based on, or derived from, some underlying asset, reference date, or index.
Discount: The difference between the cost of a security and its value at maturity when quoted at lower than face value.
Diversification: Dividing investment funds among a variety of securities offering independent returns.
Duration: A measure of the timing of the cash flows, such as the interest payments and the principal repayment, to be received from a given fixed-income security. This calculation is based on three variables: term to maturity, coupon rate, and yield to maturity.
The duration of a security is a useful indicator of its price volatility for given changes in interest rates.
Face Value: The principal amount owed on a debt instrument. It is the amount on which interest is computed and represents the amount that the issuer promises to pay at maturity.
Fair Value: The amount at which a security could be exchanged between willing parties, other than in a forced or liquidation sale. If a market price is available, the fair value is equal to the market value.
Federal Farm Credit Bank (FFCB): Government-sponsored institution that consolidates the financing activities of the Federal Land Banks, the Federal Intermediate Credit Banks and the Banks for Cooperatives. Its securities do not carry direct U. S. Government guarantees.
Federal Funds Rate: The rate of interest at which Federal funds are traded. This rate is considered the most sensitive indicator of the direction of interest rates, as it is currently pegged by the Federal Reserve through open-market operations.
Federal Home Loan Banks (FHLB): Government sponsored wholesale banks, which lend funds and provide correspondent banking services to member commercial banks, thrift institutions, credit unions and insurance companies. The mission of the FHLBs is to liquefy the housing related assets of its members who must purchase stock in their district Bank.
Federal Home Loan Mortgage Corporation (FHLMC or Freddie Mac): Established in 1970 to help maintain the availability of mortgage credit for residential housing. FHLMC finances these operations by marketing guaranteed mortgage certificates and mortgage participation certificates. Its discount notes and bonds do not carry direct U.S.
Government guarantees.
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Federal National Mortgage Association (FNMA): FNMA was chartered under the Federal National Mortgage Association Act in 1938. FNMA is a federal corporation working under the auspices of the Department of Housing and Urban Development (H.U.D.). It is the largest single provider of residential mortgage funds in the United States. Fannie Mae, as the corporation is called, is a private stockholder-owned corporation. The corporation’s purchases include a variety of adjustable mortgages and second loans in addition to fixed-rate mortgages. FNMA’s securities are also highly liquid and are widely accepted. FNMA assumes and guarantees that all security holders will receive timely payment of principal and interest.
Federal Open Market Committee (FOMC): Consists of seven members of the Federal Reserve Board and five of the twelve Federal Reserve Bank Presidents. The President of the New York Federal Reserve Bank is a permanent member while the other Presidents serve on a rotating basis. The Committee periodically meets to set Federal Reserve guidelines regarding purchases and sales of Government Securities in the open market as a means of influencing the volume of bank credit and money.
Federal Reserve System: The central bank of the U.S., which consists of seven-member Board of Governors, 12 regional banks, and about 5,700 commercial banks that are members.
Fitch IBCA, Inc. (Fitch): One of the three best-known rating agencies in the United States, the others being Moody’s Investment Service, Inc. and Standard and Poor’s Corporation.
Government Accounting Standards Board (GASB): A standard-setting body, associated with the Financial Accounting Foundation, which prescribes standard accounting practices for governmental units.
Government National Mortgage Association (GNMA or Ginnie Mae): Securities influencing the volume of bank credit guaranteed by GNMA and issued by mortgage bankers, commercial banks, savings and loan associations, and other institutions.
Security holder is protected by full faith and credit of the U.S. Government. Ginnie Mae securities are backed by FHA or VA mortgages. The term pass-through is often used to describe Ginnie Maes.
Government Securities: An obligation of the U.S. government, backed by the full faith and credit of the government. These securities are regarded as the highest quality of investment securities available in the U.S. securities market. See "Treasury Bills, Notes, and Bonds."
Guaranteed Investment Contracts (GICS): An agreement acknowledging receipt of funds, for deposit, specifying terms for withdrawal, and guaranteeing a rate of interest to be paid.
Inactive Deposits (Idle Funds): Funds not immediately needed for disbursement.
Investment-Grade Obligations: An investment instrument suitable for purchase by institutional investors under the prudent person rule. Investment-grade is restricted to those obligations rated BBB or higher by a rating agency. 142
Interest Rate Risk: The risk of gain or loss in market values of securities due to changes in interest-rate levels. For example, rising interest rates will cause the market value of portfolio securities to decline.
Inverse Floating Rate Note: A debt security with an interest rate stated as a fixed rate minus an index. This calculation causes the rate on the inverse floater to move in the opposite direction of general interest rates. This instrument generally performs well in a declining interest rate environment but will lose value if rates rise.
Liquidity: A liquid asset is one that can be converted easily and rapidly into cash without a substantial loss of value. In the money market, a security is said to be liquid if the spread between the bid and asked prices is narrow and reasonable size can be done at those quotes.
Local Agency: County, City, City and County, including a chartered city or county, school district, community college district, public district, or any public or municipal corporation.
Local Agency Investment Fund (LAIF): An investment pool managed by the California State Treasurer. Local government units, with consent of the governing body of that agency, may voluntarily deposit surplus funds for the purpose of investment. Interest earned is distributed by the State Controller to the participating governmental agencies on a quarterly basis.
Make whole call: A type of call provision on a bond that allows the issuer to pay off the remaining debt early. Unlike a call option, with a make whole call provision, the issuer makes a lump sum payment that equals the net present value (NPV) of future coupon payments that will not be paid because of the call. With this type of call, an investor is compensated, or "made whole."
Mark-to-market: The process whereby the book value or collateral value of a security is adjusted to reflect its current market value.
Market Risk: Systematic risk of a security that is common to all securities of the same general class (stocks, bonds, notes, money market instruments) and cannot be eliminated by diversification (which may be used to eliminate non-systematic risk).
Market Value: The price at which a security is trading and could presumably be sold.
Master Repurchase Agreement: A written contract covering all future transactions between the parties to repurchase agreements and reverse repurchase agreements that establish each person’s rights in the transactions. A master agreement will often specify, among other things, the right of the buyer-lender to liquidate the underlying securities in the event of default by the seller-borrower.
Maturity: The date upon which the principal or stated value of an investment becomes due and payable.
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Medium Term Notes: Instruments issued by corporations organized and operating within the United States or by depository institutions licensed by the United States or any state and operating within the United States.
Modified Duration: A measure of exposure to market risk of a security or a portfolio. It is the percent change in the price of a security (portfolio) or a 100-basis point change in the security’s (portfolio’s) yield.
Money Market: The market in which short-term debt instruments (bills, commercial paper, bankers’ acceptance, etc.) are issued and traded.
Money Market Mutual Fund: Mutual funds that invest solely in money market instruments (short-term debt instruments, such as Treasury bills, commercial paper, bankers' acceptances, repos and federal funds).
Moody’s: Moody’s Investment Service, Inc. One of the three best-known rating agencies in the United States, the others being Standard and Poor’s Corporation (S&P) and Fitch IBCA, Inc. (Fitch).
National Association of Securities Dealers (NASD): A self-regulatory organization (SRO) of brokers and dealers in the over-the-counter securities business. Its regulatory mandate includes authority over firms that distribute mutual fund shares as well as other securities.
National Recognized Statistical Rating Organization (NRSRO)::
A rating organization designated by the SEC as being nationally recognized, such as Moody's Investor Service, Inc. (Moody’s), Standard & Poor’s (S&P), and Fitch Ratings (Fitch).
Net Asset Value: The market value of one share of an investment company, such as a mutual fund. This figure is calculated by totaling a fund's assets, which includes securities, cash, and any accrued earnings, subtracting this from the fund's liabilities and dividing this total by the number of shares outstanding. This is calculated once a day based on the closing price for each security in the fund's portfolio. [(Total assets) - (Liabilities)] / (Number of shares outstanding)
Negotiable Certificate of Deposit: A large denomination certificate of deposit, which can be sold in the open market prior to maturity.
Nominal Yield: The stated rate of interest that a bond pays its current owner, based on par value of the security. It is also known as the "coupon," "coupon rate," or "interest rate." New Issue: Term used when a security is originally "brought" to market.
Note: A written promise to pay a specified amount to a certain entity on demand or on a specified date.
Open Market Operations: Purchases and sales of government and certain other securities in the open market by the New York Federal Reserve Bank as directed by the Federal Open Market Committee, (FOMC), to influence the volume of money and credit in 144
the economy. Purchases inject reserves into the bank system and stimulate growth of money and credit: Sales have the opposite effect. Open market operations are the Federal Reserve’s most important and most flexible monetary policy tool.
Par Value: The amount of principal that must be paid at maturity. Also referred to as the face amount of a bond, normally quoted in $1,000 increments per bond.
Portfolio: Collection of securities held by an investor.
Premium: The amount by which the price paid for a security exceeds the security's par value.
Primary Dealer: A group of government securities dealers that submit daily reports of market activity and positions and monthly financial statements to the Federal Reserve Bank of New York and are subject to its informal oversight. Primary dealers include Securities and Exchange Commission (SEC) registered securities, broker/dealers, banks and a few unregulated firms.
Principal: The face value or par value of a debt instrument, or the amount of capital invested in a given security.
Prospectus: A legal document that must be provided to any prospective purchaser of a new securities offering registered with the SEC that typically includes information on the issuer, the issuer’s business, the proposed use of proceeds, the experience of the issuer’s management, and certain certified financial statements (also known as an “official statement”).
Prudent Investor Standard: An investment standard. In some states, the law requires that a fiduciary, such as a trustee, may invest money only in a list of securities selected by the state, the so-called legal list. In other states, the trustee may invest in a security if it is one that would be bought by a prudent person of discretion and intelligence who is seeking a reasonable income and preservation of capital.
Purchase Date: The date in which a security is purchased for settlement on that or a later date.
Range Note: A debt security with a varied interest payment that depends on the number of days the designated index falls within (or in some cases outside) an established range of interest rates. Should rates move beyond the range on either end, the investor faces the risk of a reduced or zero interest payment for the applicable interest period.
Rate of Return: The yield obtainable on a security based on its purchase price or its current market price. This may be the amortized yield to maturity on a bond or the current income return.
Rating Agency: Nationally recognized credit rating agency such as Fitch, Moody’s or S&P.
Rating Category: A credit rating assignment by a Rating Agency shall mean (a) with respect to any long-term rating category, all ratings designated by a particular letter or 145
combination of letters, without regard to any numerical modifier, plus or minus sign or other modifier, and (b) with respect to any short-term or commercial paper rating category, all ratings designated by a particular letter or combination of letters and taking into account any numerical modifier, but not any plus or minus sign or other modifier.
Repurchase Agreement (RP or Repo): A holder of securities sells these securities to an investor with an agreement to repurchase them at a fixed price on a fixed date. The security “buyer” in effect lends the “seller” money for the period of the agreement and the terms of the agreement are structured to compensate the buyer for this. Dealers use RP extensively to finance their positions. Exception: when the Fed is said to be doing RP, it is lending money, which is increasing bank reserves.
Reverse Repurchase Agreement (Reverse Repo): A counter party (e.g. investment dealer) buys the securities from the holder of securities (e.g. the Agency) with an agreement to sell them back at a fixed date. The counter party in effect lends the seller, (e.g. the Agency) money for the period of the agreement with terms of the agreement structured to compensate buyer.
Safekeeping: A service to customers rendered by banks for a fee whereby securities and valuables of all types and descriptions are held in the bank’s vaults for protection.
Secondary Market: A market for the repurchase and resale of outstanding issues following the initial distribution.
Securities: Investment instruments such as notes, bonds, stocks, money market instruments and other instruments of indebtedness of equity.
Sec Rule 15C3:1: See Uniform Net Capital Rule.
Securities and Exchange Commission: Agency created by Congress to protect investors in securities transactions by administering securities legislation.
Settlement Date: The date on which a trade is cleared by delivery of securities against funds.
Serial Bond: A bond issue, usually of a municipality, with various maturity dates scheduled at regular intervals until the entire issue is retired.
Sinking Fund: Money accumulated on a regular basis in a separate custodial account that is used to redeem debt securities or preferred stock issues.
Spread: The difference between two figures or percentages. It may be the difference between the bid (price at which a prospective buyer offers to pay) and asked (price at which an owner offers to sell) prices of a quote, or between the amount paid when bought and the amount received when sold.
Standard and Poor’s Corporation (S&P): One of the three best-known rating agencies in the United States, the others being Moody’s Investment Service, Inc. and Fitch IBCA, Inc. (Fitch).
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Strip (Bonds): Brokerage-house practice of separating a bond into its principal and interest, which are then sold as zero-coupon bonds.
Supranationals: Multi-national organizations whereby member states transcend national boundaries or interests to share in the decision making to promote economic development in member countries.
Swap: An agreement between two parties (known as counterparties) where one stream of future interest payments is exchanged for another based on a specified principal amount.
Term Bond: Bonds comprising a large part or all of a particular issue, which come due in a single maturity. The issuer usually agrees to make periodic payments into a sinking fund for mandatory redemption of term bonds before maturity.
Time Certificate of Deposit: A non-negotiable certificate of deposit, which cannot be sold prior to maturity.
Total Return: The sum of all investment income plus changes in the capital value of the portfolio. For mutual funds, return on an investment is composed of share price appreciation plus any realized dividends or capital gains. This is calculated by taking the following components during a certain time period. (Price Appreciation) + (Dividends paid) + (Capital gains) = Total Return
Treasury Bills: A noninterest bearing discount security issued by the U.S. Treasury to finance the national debt. Most bills are issued to mature in three months, six months or one year.
Treasury Bonds: Long-term coupon-bearing U.S. Treasury securities issued as direct obligations of the U.S. Government and having initial maturities of more than 10 years.
Treasury Notes: Medium-term coupon-bearing U.S. Treasury securities issued as direct obligations of the U.S. Government and having initial maturities from two to 10 years.
Trustee or trust company or trust department of a bank: A financial institution with trust powers which acts in a fiduciary capacity for the benefit of the bondholders in enforcing the terms of the bond contract.
Underwriter: A dealer which purchases a new issue of municipal securities for resale.
Uniform Net Capital Rule: Securities and Exchange Commission requirement that member firms as well as nonmember broker/dealers in securities maintain a maximum ratio of indebtedness to liquid capital of 15 to 1; also called net capital rule and net capital ratio. Indebtedness covers all money owed to a firm, including margin loans and commitments to purchase securities, one reason new public issues are spread among members of underwriting syndicates. Liquid capital includes cash and assets easily converted into cash.
U.S. Government Agencies: Instruments issued by various U.S. Government Agencies most of which are secured only by the credit worthiness of the agency. 147
U.S. Treasury Obligations: Debt obligations of the United States Government sold by the Treasury Department in the forms of Bills, Notes, and Bonds. Bills are short-term obligations that mature in 1 year or less and are sold based on a rate of discount. Notes are obligations that mature between 1 year and 10 years. Bonds are long-term obligations that generally mature in 10 years or more.
Weighted Average Maturity (WAM): The average maturity of all the securities that comprise a portfolio that is typically expressed in days or years.
Yield: The rate of annual income returns on an investment, expressed as a percentage. (a) Income Yield is obtained by dividing the current dollar income by the current market price for the security. (b) Net Yield or Yield to Maturity is the current income yield minus any premium above par or plus any discount from par in purchase price, with the adjustment spread over the period from the date of purchase to the date of maturity of the bond.
Yield to Maturity: The rate of income returns on an investment, minus any premium or plus any discount, with the adjustment spread over the period from the date of purchase to the date of maturity of the bond, expressed as a percentage.
Yield Curve: A graphic representation that shows the relationship at a given point in time between yields and maturity for bonds that are identical in every way except maturity.
Zero-coupon Securities : Security that is issued at a discount and makes no periodic interest payments. The rate of return consists of a gradual accretion of the principal of the security and is payable at par upon maturity.
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CITY OF PITTSBURGINVESTMENT POLICY
(June 179, 20243)
I. Statement of Purpose and Adoption of Policy
It shall be the investment policy of the City of Pittsburg (the “City”) that all funds not required for immediate expenditures are invested in compliance with this statement, as well as applicable federal, state and local legislation governing the investment of public funds. Funds shall be invested in a manner that will provide the highest investment return with the appropriate level of security, while meeting the daily cash flow demands of the City.
Safeguards will be set into place to ensure that adequate operating reserves are established and maintained to provide that cash in enough amounts will be available to pay for immediate expenditures as authorized by the City’s budget.
Funds so maintained will be deposited in a manner best serving the City.
The City has a responsibility to monitor the security of its assets and always maintain a level of quality so that the public at large will have the highest confidence that its best interests are being served.
The purpose of this document is to identify various policies and procedures that enhance opportunities for a systemic investment process. The initial step toward a prudent investment policy is to organize and formalize investment related activities.
Related activities, which comprise good cash management, include accurate cash projection, the expeditious collection of revenue, the control of disbursements, cost effective banking relations and a short-term borrowing program, which coordinates working capital requirements and investment opportunities.
The City’s Investment Policy shall be adopted by resolution of City Council. The policy shall be reviewed at least annually by the City Treasurer, City Manager and the Finance Director, and any modification must be approved by City Council.
II. SCOPE
It is intended that this policy covers all operating funds and investment activities under the direct authority of the City. These funds are described in the City’s Annual Comprehensive Financial Report and include its General Fund, Special Revenue Funds, Enterprise Funds, Trust and Agency Funds, Capital Project Funds and Successor Agency Trust Funds.
The Investment Policy applies to all transactions involving the financial assets and related activities of the foregoing funds. Except for cash held in separate restricted funds, the City will pool cash balances from all funds for investments to maximize earnings and efficiencies concerning investment pricing, safekeeping and administration. Investment income will be allocated to the City’s funds based upon 149
their respective average monthly balances and in accordance with Generally Accepted Accounting Principles (GAAP).
The employee’s retirement and deferred compensation funds are not included.
Bond proceeds are not covered under this policy and shall be governed by their applicable bond documents. However, if the bond documents are silent in regard to the investment of bond proceeds and reserves, the terms set forth in this policy shall govern the respective investment of bond proceeds.
III. OBJECTIVES AND PERFORMANCE STANDARDS
The overall program shall be designed and managed with a degree of professionalism worthy of the public trust. The City’s primary investment objectives, in priority order, shall be:
1. Safety: Safety of principal is the foremost objective the City’s investment program, followed by liquidity and yield. Investments of the City shall be undertaken in a manner that seeks to ensure the preservation of capital in the City’s portfolio. To obtain this objective, the City will diversify its investment by investing funds among a variety of securities offering independent returns and financial institutions. Each investment transaction shall seek to first ensure that capital losses are avoided, whether they are from securities default or erosion of market value. Investment decisions should not incur unreasonable investment risks in order to obtain current investment income.
2. Liquidity: The City’s investment portfolio will remain sufficiently liquid to enable the City to meet all operating requirements, which might be reasonably anticipated. This need for investment liquidity may be tempered to the extent that the City is able to issue short-term notes to meet its operating requirements. Emphasis will be on marketable securities with low sensitivity to market risk. Maturities of investments for which there is limited opportunity for resale shall be staggered to maximize liquidity.
3. Yield: The City maintains an active investment strategy and its investment portfolio shall be designed to attain a rate of return which approximates benchmarks to be selected by the City’s investment advisory committee throughout budgetary and economic cycles, taking into account the City’s investment risk constraints, the cash flow characteristics of the portfolio, and state and local laws, ordinances or resolutions that restricts the investment of funds.
IV. DELEGATION OF AUTHORITY
Pursuant to California Government Code 53607 and the City’s Municipal Code, the City Council’s management responsibility for the investment program is hereby delegated for a one-year period to the Finance Director who shall be responsible for the investment of idle funds consistent with this investment policy. Subject to review, the City Council may renew the delegation of authority pursuant to this section each year. The Finance Director may delegate these duties to his/her designee upon approval of the City Council. The day-to-day investment decision- 150
making and execution authority may also be delegated to an investment advisor under the supervision of the Finance Director. The investment advisor shall follow this Policy and such other written instructions as are provided.
V. PRUDENCE AND RISK TOLERANCE
The City recognizes that investment risks of the following can result from issuer defaults, market price changes or various technical complications leading to temporary liquidity:
1. Credit risk is the possibility that deterioration of an issuer’s creditworthiness will adversely affect the value of its bonds or that an issuer will not make timely payments of interest or principal on its bonds (default). A decline in a bond issuer’s credit rating, or creditworthiness, may cause prices for its outstanding bonds to decline. This shall be mitigated by limiting investments to those allowed under this policy and by diversification.
2. Market or Interest Rate risk, defined as market value fluctuations due to overall changes in market price, shall be mitigated by eliminating the need to sell securities prior to maturity and investing operating funds needed for short-term liquidity primarily in short-term securities, money market funds or similar investment pools, thereby limiting the average maturity of the portfolio.
Investment shall be made with that degree of judgment and care, under circumstances then prevailing, which persons or prudence, discretion and intelligence exercise in the management of their own affairs, not for speculation but for investment, considering the safety of their capital as well as the income to be derived.
The standard of prudence to be used by investment officers shall be the “prudent investor standard” and shall be applied in the context of managing an overall portfolio. Investment officers acting in accordance with written procedures and the City’s investment policy and exercising due diligence shall be relieved of personal liability for an individual security credit risk or market price changes, if deviations from expectations are reported on a timely fashion, and appropriate action is taken to control adverse developments.
VI. INTERNAL CONTROLS
A system of internal controls will be maintained to assure compliance with Federal and State regulations, City Council direction, and prudent cash management procedures.
The controls shall be designed to prevent losses of public funds arising from fraud, employee error, and misrepresentation by third parties, unanticipated changes in financial markets or imprudent actions by employees and officers of the City.
Controls deemed most important include: control of collusion, segregation of duties, separating transaction authority from accounting and recordkeeping, custodial safekeeping, clear delegation of authority, specific limitations regarding securities losses and remedial action, written confirmation of telephone transactions, minimizing the number of authorized investment officials, documentation of 151
transactions and strategies, and code of ethical standards. In addition, whenever possible, pre-formatted wire transfers will be used to transfer funds to pre- authorized accounts.
1. The City Treasurer shall audit and examine all investments made by the City, or its duly authorized personnel, at those times deemed necessary by him/her and shall in his/her discretion report his/her audit and examination to the City Council.
2. Investment Oversight Committee: Quarterly review of procedures and adherence to this Investment Policy is conducted by the Investment Oversight Committee. The Committee, established by the City Council, is comprised of the City Manager, Finance Director, and City Treasurer.
3. Annual Audit: The City’s portfolio is included in the annual review of the City’s financial management performed by an outside audit firm.
VII. ETHICS AND CONFLICTS OF INTEREST
Officers and employees involved in the investment process shall not participate in personal business activity that could conflict with proper execution of the investment program or which could impair the ability to make impartial investment decisions.
Such employees and investment officials shall disclose any material financial interests in financial institutions that conduct business with the City, and they shall further disclose any large personal financial/investment positions that could be related to the performance of the City's portfolio.
VIII. ELIGIBLE INVESTMENTS
California Government Code Sections 53600 et. seq. provides basic investment limits and guidelines for government entities. Within the investments permitted by the Government Code, the City seeks to further restrict eligible investment to the investments listed below. In the event an apparent discrepancy is found between this policy and the Government Code, the more restrictive parameters will take precedence.
Rating requirements and percentage limitations, where indicated, apply at the time of purchase. In the event a security held by the City is subject to a rating change that brings it below the minimum specified rating requirement, the Finance Director shall notify the City Council of the change. The course of action to be followed will then be decided on a case-by-case basis, considering such factors as the reason for the rate drop, prognosis for recovery or further rate drops, and the market price of the security.
Eligible Investments
1. Securities of the U.S. Government:
United States Treasury notes, bonds, bills, or certificates of indebtedness, or those for which the faith and credit of the United States are pledged for the 152
payment of principal and interest. There is no limitation as to the percentage of the City’s portfolio that may be invested in this category.
2. Securities of U.S. Government Agencies
Federal agency or United States government-sponsored enterprise obligations, participations, or other instruments, including those issued by or fully guaranteed as to principal and interest by federal agencies or United States government- sponsored enterprises. There is no limitation as to the percentage of the City’s portfolio that may be invested in this category, provided that no more than 30% of the portfolio may be invested in any single Agency/GSE issuer, the maximum maturity may not exceed five (5) years, and the maximum percent of agency callable securities in the portfolio will be 20%.
3. California State and Local Agency Obligations
Obligations of the City, the State of California or any local agency within the state that are general obligation bonds or essential service bonds secured with revenue from a water, sewer, power or electric system, provided that such obligations are rated in a rating category of “A” or its equivalent or better by at least one nationally recognized statistical rating organization (NRSRO.) No more than 5 percent of the portfolio may be invested in any single issuer. No more than 30 percent of the portfolio may be invested in California State and Local Agency Obligations and other state obligations in the aggregate. The maximum maturity may not exceed five years.
4. Other State Obligations
Registered treasury notes or bonds of any of the other 49 United States in addition to California, including general obligation bonds or bonds payable solely out of the revenues from a revenue-producing property owned, controlled or operated by a state or by a department, board, agency or authority of any of the other 49 United States, in addition to California, provided that such obligations are rated in a rating category of “A” or its equivalent or better by at least one NRSRO. No more than 5 percent of the portfolio may be invested in any single issuer. No more than 30 percent of the portfolio may be invested in other state obligations and California State and Local Agency Obligations in the aggregate.
The maximum maturity may not exceed five years.
5. Bankers Acceptances
Time drafts or bills of exchange that are drawn on and accepted by a commercial bank and brokered to investors in the secondary market. Purchasers are limited to issuers whose short-term debt is rated in the highest short-term rating category by a NRSRO. Banker’s acceptances cannot exceed a maturity of 180 days. A maximum of 40% of the City’s portfolio may be invested in this category.
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6. Commercial paper
The City may purchase commercial paper with short-term ratings of “A-1” or the equivalent or higher by a NRSRO. Long-term ratings, if any, must be “A” category or its equivalent or higher by a NRSRO. The entity that issues the commercial paper shall meet all the following conditions in either paragraph (A) or paragraph (B):
(A) The entity meets the following criteria: (i) Is organized and operating in the United States as a general corporation. (ii) Has total assets of more than five hundred million dollars ($500,000,000). (iii) Has debt other than commercial paper, if any, that is rated in the “A” category or its equivalent or higher by a NRSRO
(B) The entity meets the following criteria: (i) Is organized within the United States as a special purpose corporation, trust, or limited liability company. (ii) Has program wide credit enhancements including, but not limited to, over collateralization, letters of credit, or surety bond. (iii) Has commercial paper that is rated “A-1” or higher, or the equivalent, by a NRSRO.
Eligible commercial paper shall have a maximum maturity of 270 days or less and not represent more than 10 percent of the outstanding paper of an issuing corporation. A maximum of 25 percent of the City’s portfolio may be invested in this category. Under a provision sunsetting on January 1, 2026, no more than 40 percent of the portfolio may be invested in Commercial Paper if the City’s investment assets under management are greater than $100,000,000.
7. Negotiable Certificates of Deposit (NCDs)
Negotiable certificates of deposit issued by a nationally or state-chartered bank, a savings association or a federal association (as defined by Section 5102 of the Financial Code), a state or federal credit union, or by a state or federally licensed branch of a foreign bank. Amounts of the NCD insured up to the FDIC limit do not require any credit rating. Any amount above the FDIC insured limit which has short-term ratings of “A-1” or its equivalent or higher by a NRSRO; or long-term obligations rated in a category of “A” or its equivalent or higher by a NRSRO may be purchased. A maximum of 30 percent of the City’s portfolio may be invested in this category. No more than 5 percent of the portfolio may be invested in any single issuer.
8. Time Deposits
The City may invest in non-negotiable time deposits (CDs) that are FDIC insured or fully collateralized in financial institutions located in California, including United States branches of foreign banks licensed to do business in California.
To be eligible for purchase, the financial institution must have received a minimum overall satisfactory rating for meeting the credit needs of California Communities in its most recent evaluation, as provided Government Code Section 53635.2. Purchases are further limited to financial institutions meeting all capital requirements and rated in one of the three highest rating categories by an NRSRO organization. All time deposits must be collateralized in accordance 154
with California Government Code sections 53650 et. seq. The City, at its discretion, may waive the collateralization requirements for any portion of the deposit that is covered by federal insurance. The maximum maturity of a time certificate of deposit shall not exceed 1 year. A maximum of 30 percent of the City’s portfolio may be invested in this category.
9. Repurchase Agreements
The City may enter into repurchase agreements with primary government securities dealers rated in one of the three highest categories by two NRSROs.
Counterparties should also have (i) a short-term credit rating in the highest category; (ii) minimum assets and capital size of $25 billion in assets and $350 million in capital; (iii) five years of acceptable audited financial results; and (iv) a strong reputation among market participants.
The following collateral restrictions will be observed: Only U.S. Treasury securities or Federal Agency securities will be acceptable collateral. All securities underlying repurchase agreements must be delivered to the City’s custodian bank delivery versus payment or be handled under a properly executed tri-party repurchase agreement. The total market value of all collateral for each repurchase agreement must equal or exceed 102 percent of the total dollar value of the money invested by the City for the term of the investment.
For any repurchase agreement with a term of more than one day, the value of the underlying securities must be reviewed on a weekly basis according to market conditions. Since the market value of the underlying securities is subject to daily market fluctuations, the investment in repurchase agreements shall comply if the value of the underlying securities is brought back up to 102 percent no later than the next business day. Market value must also be calculated each time there is a substitution of collateral.
The City or its trustee shall have a perfected first security interest under the Uniform Commercial Code in all securities subject to repurchase agreement.
The City shall have properly executed a master repurchase agreement with each counter party with which it enters into repurchase agreements.
Repurchase agreements are to be used solely as short-term investments not to exceed 90 days. A maximum of 15 percent of the City’s portfolio may be invested in this category.
10.Medium Term Notes
Medium-term notes, defined as all corporate and depository institution debt securities with a maximum remaining maturity of five years or less, issued by corporations organized and operating within the United States or by depository institutions licensed by the United States or any state and operating within the United States. Purchases are limited to securities rated in a rating category of “A” or its equivalent or better by at least one NRSRO. A maximum of 30 percent of the City’s portfolio may be invested in this category. No more than 5% of the portfolio may be invested in any single issuer.
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11.Asset-Backed Securities
A mortgage pass-through security, collateralized mortgage obligation, mortgage- backed or other pay-through bond, equipment lease-backed certificate, consumer receivable pass-through certificate, or consumer receivable-backed bond from issuers not defined in subsections 1 and 2 of the Eligible Investments Section, of a legal final maturity not exceeding five years. Securities eligible for investment under this subdivision must be rated in in a rating category of “AA” or its equivalent or better by a NRSRO. A maximum of 20 percent of the City’s portfolio may be invested in this category. No more than 5% of the portfolio may be invested in any single Asset-Backed or Commercial Mortgage security issuer.
12.Supranational Securities
United States dollar denominated senior unsecured unsubordinated obligations issued or unconditionally guaranteed by the International Bank for Reconstruction and Development, International Finance Corporation, or Inter- American Development Bank, with a maximum remaining maturity of five years or less, and eligible for purchase and sale within the United States. Securities eligible for investment under this subdivision must be rated in a rating category of “AA” or its equivalent or better by a NRSRO. A maximum of 30 percent of the City’s portfolio may be invested in this category. No more than 10% of the portfolio may be invested in any single issuer.
13.Money Market Funds
Shares of beneficial interest issued by diversified management companies that are money market funds registered with the Securities and Exchange Commission under the Investment Company Act of 1940 (15 U.S.C. Sec. 80a-1 et seq.). To be eligible for purchase, the company shall have met either of the following criteria:
(A) Attained the highest ranking or the highest letter and numerical rating provided by not less than two NRSROs.
(B) Retained an investment adviser registered or exempt from registration with the Securities and Exchange Commission with not less than five years' experience managing money market mutual funds with assets under management in excess of $500,000,000.
A maximum of 20 percent of the City’s portfolio may be invested in this category (10 percent limit per fund).
14.State of California’s Local Agency Investment Fund (LAIF) The Local Agency Investment Fund was established by the State to enable local agency treasurers to place funds in a pool for investment (California Government Code Section 16429.1 et seq.). The City uses this investment vehicle for short-term liquidity, investment, and yield when rates are declining. 156
Funds are available on demand and interest is paid quarterly. The City may invest up to the maximum permitted by LAIF.
15.California Asset Management Program (CAMP)Local Government Investment Pools
Shares of beneficial interest issued by a joint powers authority organized pursuant to Government Code Section 6509.7 that invests the securities and obligations authorized in subdivisions (a) to (n), inclusive, of Government Code Section 53601.
IX. Investment Pools/Mutual Funds
The City shall conduct a thorough investigation of any pool or mutual fund prior to making an investment, and on a continual basis thereafter. The Finance Director shall develop a questionnaire which will answer the following general questions:
A description of eligible investment securities, and a written statement of investment policy and objectives.
A description of interest calculations and how it is distributed, and how gains and losses are treated.
A description of how the securities are safeguarded (including the settlement processes), and how often the securities are priced and the program audited. A description of who may invest in the program, how often, and what size deposit and withdrawal are allowed.
A schedule for receiving statements and portfolio listings. Are reserves, retained earnings, etc. utilized by the pool/fund? A fee schedule, and when and how it is assessed.
Is the pool/fund eligible for bond proceeds and/or will it accept such proceeds?
X. DIVERSIFICATION AND RISK MANAGEMENT
Mitigating Credit Risk in the Portfolio
Credit risk is the risk that a security or a portfolio will lose some or all its value due to a real or perceived change in the ability of the issuer to repay its debt. The City will mitigate credit risk by adopting the following strategies:
The diversification requirements included in the “Authorized Investments” section of this policy are designed to mitigate credit risk in the portfolio. No more than 5% of the total portfolio may be deposited with or invested in securities issued by any single issuer unless otherwise specified in this policy. The City may elect to sell a security prior to its maturity and record a capital gain or loss in order to manage the quality, liquidity or yield of the portfolio in response to market conditions or Agency’s risk preferences. 157
If a security owned by the City is downgraded to a level below the requirements of this policy, making the security ineligible for additional purchases, the following steps will be taken:
Any actions taken related to the downgrade by the investment manager will be communicated to the Finance Director in a timely manner. If a decision is made to retain the security, the credit situation will be monitored and reported to the City Council.
Mitigating Market Risk in the Portfolio
Market risk is the risk that the portfolio value will fluctuate due to changes in the general level of interest rates. The City recognizes that, over time, longer-term portfolios have the potential to achieve higher returns. On the other hand, longer- term portfolios have higher volatility of return. The City will mitigate market risk by providing adequate liquidity for short-term cash needs, and by making longer-term investments only with funds that are not needed for current cash flow purposes.
The City further recognizes that certain types of securities, including variable rate securities, securities with principal paydowns prior to maturity, and securities with embedded options, will affect the market risk profile of the portfolio differently in different interest rate environments. The Agency, therefore, adopts the following strategies to control and mitigate its exposure to market risk:
The City will maintain a minimum of six months of budgeted operating expenditures in short-term investments to provide sufficient liquidity for expected disbursements.
The maximum stated final maturity of individual securities in the portfolio will be five (5) years as measured from date of trade settlement, except as otherwise stated in this policy.
The duration of the portfolio will generally be approximately equal to the duration (typically, plus or minus 20%) of a Market Benchmark, an index selected by the City based on the City’s investment objectives, constraints and risk tolerances.
Maximum maturities may not exceed five years.
XI. MAXIMUM MATURITY
The City’s cash management system is fully designed to accurately monitor and forecast revenues and expenditures thus enabling the City to invest funds possible.
To the extent possible, the City will attempt to match investments with anticipated cash flow requirements. Because of inherent difficulties in accurately forecasting cash flow requirements, a portion of the portfolio should be continuously invested in readily available funds.
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Where this Policy does not specify a maximum remaining maturity at the time of the investment, no investment shall be made in any security, other than a security underlying a repurchase agreement, that at the time of the investment has a term remaining to maturity in excess of five years as measured from date of trade settlement, unless the City Council has granted express authority to make that investment either specifically or as a part of an investment program approved by the City Council no less than three months prior to the investment.
XII. INELIGIBLE INVESTMENTS
Investments not described herein, including but not limited to common stocks and financial futures contracts and options, are prohibited in this fund. The City shall not invest any funds in inverse floaters, range notes, mortgage derived interest-only strips or in any security that could result in zero interest accrual if held to maturity.
The purchase of any security not listed in Section 8 above, but permitted by the California Government Code, is prohibited unless the City Council approves the investment specifically or as a part of an investment program approved by the City Council. Securities with a trade settlement period longer than 45 days are prohibited.
XIII. BANKS AND SECURITIES DEALERS
The Finance Director shall maintain a list of authorized broker/dealers and financial institutions, which are approved for investment purposes. It shall be the City’s policy to purchase securities only from those authorized institutions and firms. The City shall annually send a copy of the current investment policy to all dealers approved to do business with the City. Each broker dealer or financial institution that has been authorized by the City shall be required to submit the firm’s most recent financial statement. If an investment advisor is used, they may use their own list of approved broker/dealers and financial institutions for investment purposes.
XIV. SAFEKEEPING AND CUSTODY
All security transactions entered by the City shall be conducted on a delivery- versus-payment (DVP) basis. All cash and securities in the City’s portfolio, including those that are managed by an investment advisor, shall be held in safekeeping in the City’s name by a third-party bank trust department, acting as agent for the City under the terms of a custody agreement executed by the bank and the City. The only exception to the foregoing shall be depository accounts and securities purchases made with: (i) local government investment pools; (ii) time certificates of deposit, and, (iii) money market mutual funds, since the purchased securities are not deliverable. Evidence of each of these investments will be held in the Treasury vault. The safekeeping institution shall annually provide a copy of their most recent report on internal controls (Statement of Auditing Standards No. 70, or SAS 70).
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XV. PERFORMANCE STANDARDS
The investment portfolio will be designed to obtain a market-average rate of return during budgetary and economic cycles, considering the City’s investment risk constraints and cash flow needs.
XVI. REPORTING REQUIREMENTS
A Quarterly Investment report shall be provided to the City Council, City Manager, and Finance Director.
1. A quarterly investment report will be submitted within 60 days following the period being reported to the City Council. Reports of the investment of bond proceeds are issued monthly by the Trustee and are included in the quarterly report of the pooled investment fund. The quarterly investment report shall include information on the following:
Type of Investment
Issuer
Date of Maturity
Par and dollar amount invested on all securities
Current market value of each security and the source of the valuation Credit quality of each investment, as determined by one or more nationally recognized credit rating services
Listing of investment transactions for the quarter being reported upon. Statement that portfolio follows investment policy, or the way the portfolio is not in compliance
Statement denoting ability of City to meet its expenditure requirements for the next six months, or provide enough explanation why money is not available
XVII. INVESTMENT POLICY REVIEW
The Finance Director shall periodically submit to the City Council a statement of investment policy outlining any proposed changes, which the City Council must consider at a public meeting.
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Glossary of Terms
Accrued Interest: Interest earned but not yet received.
Active Deposits: Funds which are immediately required for disbursement.
Amortization: An accounting practice of gradually decreasing (increasing) an asset's book value by spreading its depreciation (accretion) over a period.
Annual Comprehensive Financial Report (ACFR): The official annual financial report for public sector entities/companies. It includes five combined statements and basic financial statements for each individual fund and account group prepared in conformity with Generally Accepted Accounting Principles (GAAP).
Arbitrage: Transactions by which securities are bought and sold in different markets at the same time for the sake of the profit arising from a yield difference in the two markets.
Asked Price: The price a broker/dealer offers to sell securities.
Average Life: The average length of time that an issue of serial bonds and/or term bonds with a mandatory sinking fund features is expected to be outstanding.
Bankers’ Acceptance (BA): A draft or bill of exchange accepted by a bank or trust company. The accepting institution guarantees payment of the bill, as well as the issuer.
Basis Point: One basis point is one hundredth of one percent (.01).
Bid Price: The price a broker/dealer offers to purchase securities.
Bond: A financial obligation for which the issuer promises to pay the bondholder a specified stream of future cash flows, including periodic interest payments and a principal repayment.
Book Entry: The system maintained by the Federal Reserve, by which most money market securities are delivered to an investor’s custodial bank. The Federal Reserve maintains a computerized record of the ownership of these securities and records any changes in ownership corresponding to payments made over the Federal Reserve wire (delivery versus payment.)
Book Value: The value at which a debt security is shown on the holder's balance sheet.
Book value is acquisition cost less amortization of premium or accretion of discount.
Broker: A broker brings buyers and sellers together for a commission paid by the initiator of the transaction or by both sides; he does not take a position. In the money market, brokers are active in markets in which banks buy and sell money and in interdealer markets.
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Callable Bond: A bond issue in which all or part of its outstanding principal amount may be redeemed before maturity by the issuer under specified conditions.
Call Price: The price at which an issuer may redeem a bond prior to maturity. The price is usually at a slight premium to the bond's original issue price to compensate the holder for loss of income and ownership.
Call Risk: The risk to a bondholder that a bond may be redeemed prior to maturity.
Cash Sale/Purchase: A transaction which calls for delivery and payment of securities on the same day that the transaction is initiated.
Certificate of Deposit (CD): A time deposit with a specific maturity evidenced by a Certificate. Large-denomination CDs are typically negotiable.
Collateral: Securities, evidence of deposit or other property, which a borrower pledges to secure repayment of a loan. Also refers to securities pledged by a bank to secure deposits of public monies.
Commercial Paper: A short-term, unsecured, and negotiable promissory note with a fixed maturity of no more than 270 days. By statute, these issues are exempt from registration with the U.S. Securities and Exchange Commission.
Convexity: A measure of a bond's price sensitivity to changing interest rates. A high convexity indicates greater sensitivity of a bond's price to interest rate changes.
Coupon: The annual rate of interest that a bond's issuer promises to pay the bondholder on the bond's face value.
Credit Analysis: A critical review and appraisal of the economic and financial conditions or of the ability to meet debt obligations.
Credit Risk: The risk to an investor that an issuer will default in the payment of interest and/or principal on a security and a loss will result.
Current Yield: The interest paid on an investment expressed as a percentage of the current price of the security.
Custodian: A bank or other financial institution that keeps custody of stock certificates and other assets.
Dealer: A dealer, as opposed to a broker, acts as a principal in all transactions, buying and selling for his or her own account.
Debenture: A bond secured only by the general credit of the issuer.
Defeased Bond Issues: Issues that have sufficient money to retire outstanding debt when due so that the agency is released from the contracts and covenants in the bond document.
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Delivery versus Payment: There are two methods of delivery of securities: delivery versus payment and delivery versus receipt (also called free delivery). Delivery versus payment is delivery of securities with an exchange of money for the securities. Delivery versus receipt is delivery of securities with an exchange of a signed receipt for the securities.
Derivative: Securities that are based on, or derived from, some underlying asset, reference date, or index.
Discount: The difference between the cost of a security and its value at maturity when quoted at lower than face value.
Diversification: Dividing investment funds among a variety of securities offering independent returns.
Duration: A measure of the timing of the cash flows, such as the interest payments and the principal repayment, to be received from a given fixed-income security. This calculation is based on three variables: term to maturity, coupon rate, and yield to maturity.
The duration of a security is a useful indicator of its price volatility for given changes in interest rates.
Face Value: The principal amount owed on a debt instrument. It is the amount on which interest is computed and represents the amount that the issuer promises to pay at maturity.
Fair Value: The amount at which a security could be exchanged between willing parties, other than in a forced or liquidation sale. If a market price is available, the fair value is equal to the market value.
Federal Farm Credit Bank (FFCB): Government-sponsored institution that consolidates the financing activities of the Federal Land Banks, the Federal Intermediate Credit Banks and the Banks for Cooperatives. Its securities do not carry direct U. S. Government guarantees.
Federal Funds Rate: The rate of interest at which Federal funds are traded. This rate is considered the most sensitive indicator of the direction of interest rates, as it is currently pegged by the Federal Reserve through open-market operations.
Federal Home Loan Banks (FHLB): Government sponsored wholesale banks, which lend funds and provide correspondent banking services to member commercial banks, thrift institutions, credit unions and insurance companies. The mission of the FHLBs is to liquefy the housing related assets of its members who must purchase stock in their district Bank.
Federal Home Loan Mortgage Corporation (FHLMC or Freddie Mac): Established in 1970 to help maintain the availability of mortgage credit for residential housing. FHLMC finances these operations by marketing guaranteed mortgage certificates and mortgage participation certificates. Its discount notes and bonds do not carry direct U.S.
Government guarantees.
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Federal National Mortgage Association (FNMA): FNMA was chartered under the Federal National Mortgage Association Act in 1938. FNMA is a federal corporation working under the auspices of the Department of Housing and Urban Development (H.U.D.). It is the largest single provider of residential mortgage funds in the United States. Fannie Mae, as the corporation is called, is a private stockholder-owned corporation. The corporation’s purchases include a variety of adjustable mortgages and second loans in addition to fixed-rate mortgages. FNMA’s securities are also highly liquid and are widely accepted. FNMA assumes and guarantees that all security holders will receive timely payment of principal and interest.
Federal Open Market Committee (FOMC): Consists of seven members of the Federal Reserve Board and five of the twelve Federal Reserve Bank Presidents. The President of the New York Federal Reserve Bank is a permanent member while the other Presidents serve on a rotating basis. The Committee periodically meets to set Federal Reserve guidelines regarding purchases and sales of Government Securities in the open market as a means of influencing the volume of bank credit and money.
Federal Reserve System: The central bank of the U.S., which consists of seven-member Board of Governors, 12 regional banks, and about 5,700 commercial banks that are members.
Fitch IBCA, Inc. (Fitch): One of the three best-known rating agencies in the United States, the others being Moody’s Investment Service, Inc. and Standard and Poor’s Corporation.
Government Accounting Standards Board (GASB): A standard-setting body, associated with the Financial Accounting Foundation, which prescribes standard accounting practices for governmental units.
Government National Mortgage Association (GNMA or Ginnie Mae): Securities influencing the volume of bank credit guaranteed by GNMA and issued by mortgage bankers, commercial banks, savings and loan associations, and other institutions.
Security holder is protected by full faith and credit of the U.S. Government. Ginnie Mae securities are backed by FHA or VA mortgages. The term pass-through is often used to describe Ginnie Maes.
Government Securities: An obligation of the U.S. government, backed by the full faith and credit of the government. These securities are regarded as the highest quality of investment securities available in the U.S. securities market. See "Treasury Bills, Notes, and Bonds."
Guaranteed Investment Contracts (GICS): An agreement acknowledging receipt of funds, for deposit, specifying terms for withdrawal, and guaranteeing a rate of interest to be paid.
Inactive Deposits (Idle Funds): Funds not immediately needed for disbursement.
Investment-Grade Obligations: An investment instrument suitable for purchase by institutional investors under the prudent person rule. Investment-grade is restricted to those obligations rated BBB or higher by a rating agency. 164
Interest Rate Risk: The risk of gain or loss in market values of securities due to changes in interest-rate levels. For example, rising interest rates will cause the market value of portfolio securities to decline.
Inverse Floating Rate Note: A debt security with an interest rate stated as a fixed rate minus an index. This calculation causes the rate on the inverse floater to move in the opposite direction of general interest rates. This instrument generally performs well in a declining interest rate environment but will lose value if rates rise.
Liquidity: A liquid asset is one that can be converted easily and rapidly into cash without a substantial loss of value. In the money market, a security is said to be liquid if the spread between the bid and asked prices is narrow and reasonable size can be done at those quotes.
Local Agency: County, City, City and County, including a chartered city or county, school district, community college district, public district, or any public or municipal corporation.
Local Agency Investment Fund (LAIF): An investment pool managed by the California State Treasurer. Local government units, with consent of the governing body of that agency, may voluntarily deposit surplus funds for the purpose of investment. Interest earned is distributed by the State Controller to the participating governmental agencies on a quarterly basis.
Make whole call: A type of call provision on a bond that allows the issuer to pay off the remaining debt early. Unlike a call option, with a make whole call provision, the issuer makes a lump sum payment that equals the net present value (NPV) of future coupon payments that will not be paid because of the call. With this type of call, an investor is compensated, or "made whole."
Mark-to-market: The process whereby the book value or collateral value of a security is adjusted to reflect its current market value.
Market Risk: Systematic risk of a security that is common to all securities of the same general class (stocks, bonds, notes, money market instruments) and cannot be eliminated by diversification (which may be used to eliminate non-systematic risk).
Market Value: The price at which a security is trading and could presumably be sold.
Master Repurchase Agreement: A written contract covering all future transactions between the parties to repurchase agreements and reverse repurchase agreements that establish each person’s rights in the transactions. A master agreement will often specify, among other things, the right of the buyer-lender to liquidate the underlying securities in the event of default by the seller-borrower.
Maturity: The date upon which the principal or stated value of an investment becomes due and payable.
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Medium Term Notes: Instruments issued by corporations organized and operating within the United States or by depository institutions licensed by the United States or any state and operating within the United States.
Modified Duration: A measure of exposure to market risk of a security or a portfolio. It is the percent change in the price of a security (portfolio) or a 100-basis point change in the security’s (portfolio’s) yield.
Money Market: The market in which short-term debt instruments (bills, commercial paper, bankers’ acceptance, etc.) are issued and traded.
Money Market Mutual Fund: Mutual funds that invest solely in money market instruments (short-term debt instruments, such as Treasury bills, commercial paper, bankers' acceptances, repos and federal funds).
Moody’s: Moody’s Investment Service, Inc. One of the three best-known rating agencies in the United States, the others being Standard and Poor’s Corporation (S&P) and Fitch IBCA, Inc. (Fitch).
National Association of Securities Dealers (NASD): A self-regulatory organization (SRO) of brokers and dealers in the over-the-counter securities business. Its regulatory mandate includes authority over firms that distribute mutual fund shares as well as other securities.
National Recognized Statistical Rating Organization (NRSRO)::
A rating organization designated by the SEC as being nationally recognized, such as Moody's Investor Service, Inc. (Moody’s), Standard & Poor’s (S&P), and Fitch Ratings (Fitch).
Net Asset Value: The market value of one share of an investment company, such as a mutual fund. This figure is calculated by totaling a fund's assets, which includes securities, cash, and any accrued earnings, subtracting this from the fund's liabilities and dividing this total by the number of shares outstanding. This is calculated once a day based on the closing price for each security in the fund's portfolio. [(Total assets) - (Liabilities)] / (Number of shares outstanding)
Negotiable Certificate of Deposit: A large denomination certificate of deposit, which can be sold in the open market prior to maturity.
Nominal Yield: The stated rate of interest that a bond pays its current owner, based on par value of the security. It is also known as the "coupon," "coupon rate," or "interest rate." New Issue: Term used when a security is originally "brought" to market.
Note: A written promise to pay a specified amount to a certain entity on demand or on a specified date.
Open Market Operations: Purchases and sales of government and certain other securities in the open market by the New York Federal Reserve Bank as directed by the Federal Open Market Committee, (FOMC), to influence the volume of money and credit in 166
the economy. Purchases inject reserves into the bank system and stimulate growth of money and credit: Sales have the opposite effect. Open market operations are the Federal Reserve’s most important and most flexible monetary policy tool.
Par Value: The amount of principal that must be paid at maturity. Also referred to as the face amount of a bond, normally quoted in $1,000 increments per bond.
Portfolio: Collection of securities held by an investor.
Premium: The amount by which the price paid for a security exceeds the security's par value.
Primary Dealer: A group of government securities dealers that submit daily reports of market activity and positions and monthly financial statements to the Federal Reserve Bank of New York and are subject to its informal oversight. Primary dealers include Securities and Exchange Commission (SEC) registered securities, broker/dealers, banks and a few unregulated firms.
Principal: The face value or par value of a debt instrument, or the amount of capital invested in a given security.
Prospectus: A legal document that must be provided to any prospective purchaser of a new securities offering registered with the SEC that typically includes information on the issuer, the issuer’s business, the proposed use of proceeds, the experience of the issuer’s management, and certain certified financial statements (also known as an “official statement”).
Prudent Investor Standard: An investment standard. In some states, the law requires that a fiduciary, such as a trustee, may invest money only in a list of securities selected by the state, the so-called legal list. In other states, the trustee may invest in a security if it is one that would be bought by a prudent person of discretion and intelligence who is seeking a reasonable income and preservation of capital.
Purchase Date: The date in which a security is purchased for settlement on that or a later date.
Range Note: A debt security with a varied interest payment that depends on the number of days the designated index falls within (or in some cases outside) an established range of interest rates. Should rates move beyond the range on either end, the investor faces the risk of a reduced or zero interest payment for the applicable interest period.
Rate of Return: The yield obtainable on a security based on its purchase price or its current market price. This may be the amortized yield to maturity on a bond or the current income return.
Rating Agency: Nationally recognized credit rating agency such as Fitch, Moody’s or S&P.
Rating Category: A credit rating assignment by a Rating Agency shall mean (a) with respect to any long-term rating category, all ratings designated by a particular letter or 167
combination of letters, without regard to any numerical modifier, plus or minus sign or other modifier, and (b) with respect to any short-term or commercial paper rating category, all ratings designated by a particular letter or combination of letters and taking into account any numerical modifier, but not any plus or minus sign or other modifier.
Repurchase Agreement (RP or Repo): A holder of securities sells these securities to an investor with an agreement to repurchase them at a fixed price on a fixed date. The security “buyer” in effect lends the “seller” money for the period of the agreement and the terms of the agreement are structured to compensate the buyer for this. Dealers use RP extensively to finance their positions. Exception: when the Fed is said to be doing RP, it is lending money, which is increasing bank reserves.
Reverse Repurchase Agreement (Reverse Repo): A counter party (e.g. investment dealer) buys the securities from the holder of securities (e.g. the Agency) with an agreement to sell them back at a fixed date. The counter party in effect lends the seller, (e.g. the Agency) money for the period of the agreement with terms of the agreement structured to compensate buyer.
Safekeeping: A service to customers rendered by banks for a fee whereby securities and valuables of all types and descriptions are held in the bank’s vaults for protection.
Secondary Market: A market for the repurchase and resale of outstanding issues following the initial distribution.
Securities: Investment instruments such as notes, bonds, stocks, money market instruments and other instruments of indebtedness of equity.
Sec Rule 15C3:1: See Uniform Net Capital Rule.
Securities and Exchange Commission: Agency created by Congress to protect investors in securities transactions by administering securities legislation.
Settlement Date: The date on which a trade is cleared by delivery of securities against funds.
Serial Bond: A bond issue, usually of a municipality, with various maturity dates scheduled at regular intervals until the entire issue is retired.
Sinking Fund: Money accumulated on a regular basis in a separate custodial account that is used to redeem debt securities or preferred stock issues.
Spread: The difference between two figures or percentages. It may be the difference between the bid (price at which a prospective buyer offers to pay) and asked (price at which an owner offers to sell) prices of a quote, or between the amount paid when bought and the amount received when sold.
Standard and Poor’s Corporation (S&P): One of the three best-known rating agencies in the United States, the others being Moody’s Investment Service, Inc. and Fitch IBCA, Inc. (Fitch).
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Strip (Bonds): Brokerage-house practice of separating a bond into its principal and interest, which are then sold as zero-coupon bonds.
Supranationals: Multi-national organizations whereby member states transcend national boundaries or interests to share in the decision making to promote economic development in member countries.
Swap: An agreement between two parties (known as counterparties) where one stream of future interest payments is exchanged for another based on a specified principal amount.
Term Bond: Bonds comprising a large part or all of a particular issue, which come due in a single maturity. The issuer usually agrees to make periodic payments into a sinking fund for mandatory redemption of term bonds before maturity.
Time Certificate of Deposit: A non-negotiable certificate of deposit, which cannot be sold prior to maturity.
Total Return: The sum of all investment income plus changes in the capital value of the portfolio. For mutual funds, return on an investment is composed of share price appreciation plus any realized dividends or capital gains. This is calculated by taking the following components during a certain time period. (Price Appreciation) + (Dividends paid) + (Capital gains) = Total Return
Treasury Bills: A noninterest bearing discount security issued by the U.S. Treasury to finance the national debt. Most bills are issued to mature in three months, six months or one year.
Treasury Bonds: Long-term coupon-bearing U.S. Treasury securities issued as direct obligations of the U.S. Government and having initial maturities of more than 10 years.
Treasury Notes: Medium-term coupon-bearing U.S. Treasury securities issued as direct obligations of the U.S. Government and having initial maturities from two to 10 years.
Trustee or trust company or trust department of a bank: A financial institution with trust powers which acts in a fiduciary capacity for the benefit of the bondholders in enforcing the terms of the bond contract.
Underwriter: A dealer which purchases a new issue of municipal securities for resale.
Uniform Net Capital Rule: Securities and Exchange Commission requirement that member firms as well as nonmember broker/dealers in securities maintain a maximum ratio of indebtedness to liquid capital of 15 to 1; also called net capital rule and net capital ratio. Indebtedness covers all money owed to a firm, including margin loans and commitments to purchase securities, one reason new public issues are spread among members of underwriting syndicates. Liquid capital includes cash and assets easily converted into cash.
U.S. Government Agencies: Instruments issued by various U.S. Government Agencies most of which are secured only by the credit worthiness of the agency. 169
U.S. Treasury Obligations: Debt obligations of the United States Government sold by the Treasury Department in the forms of Bills, Notes, and Bonds. Bills are short-term obligations that mature in 1 year or less and are sold based on a rate of discount. Notes are obligations that mature between 1 year and 10 years. Bonds are long-term obligations that generally mature in 10 years or more.
Weighted Average Maturity (WAM): The average maturity of all the securities that comprise a portfolio that is typically expressed in days or years.
Yield: The rate of annual income returns on an investment, expressed as a percentage. (a) Income Yield is obtained by dividing the current dollar income by the current market price for the security. (b) Net Yield or Yield to Maturity is the current income yield minus any premium above par or plus any discount from par in purchase price, with the adjustment spread over the period from the date of purchase to the date of maturity of the bond.
Yield to Maturity: The rate of income returns on an investment, minus any premium or plus any discount, with the adjustment spread over the period from the date of purchase to the date of maturity of the bond, expressed as a percentage.
Yield Curve: A graphic representation that shows the relationship at a given point in time between yields and maturity for bonds that are identical in every way except maturity.
Zero-coupon Securities : Security that is issued at a discount and makes no periodic interest payments. The rate of return consists of a gradual accretion of the principal of the security and is payable at par upon maturity.
170
OFFICE OF THE CITY MANAGER/EXECUTIVE DIRECTOR
65 Civic Avenue
Pittsburg, CA 94565
TO: Mayor and Council Members
FROM: Garrett Evans, City Manager
SUBJECT: Adoption of a City Council Resolution Approving the Appropriations Limit for Fiscal Year 2024/25 in Accordance the Gann Initiative MEETING DATE: June 17, 2024
EXECUTIVE SUMMARY
In November 1979, the voters of California approved Proposition 4, commonly known as the Gann Initiative, which created Article XIII B of the State Constitution, placing limits on the amount of revenue which can be appropriated by all government entities in any fiscal year (FY). This legislation mandates all governing bodies, including the City of Pittsburg, to annually establish the appropriations limit.
FISCAL IMPACT
Approval of the FY 2024/25 Appropriations Limit has no impact to the City of Pittsburg’s budget. The FY 2024/25 Appropriations Limit is $218,697,177 and will exceed the General Fund estimated spending plan of $67,286,866.
RECOMMENDATION
City Council adopt the Resolution approving the FY 2024/25 Appropriations Limit in Accordance with the Gann Initiative.
BACKGROUND
Article XIII B of the State Constitution (Government Code Section 7910 (a)) was enacted and it requires that each year, the governing body of each local jurisdiction shall, by resolution, establish its appropriations limit for the following fiscal year. The determination of the appropriations limit is considered to be a legislative act and should be adopted at a regular City Council meeting.
171
Proposition 111, approved by California voters in 1990, amended Article XIII B, specifying that the annual adjustment factors in calculating the appropriations limit will be increased by:
• The change in population growth for the City or County (whichever is higher) • The change in California Per Capita Personal Income (cost-of-living)
SUBCOMMITTEE FINDINGS
This item was not presented to the Finance Management Subcommittee.
STAFF ANALYSIS
The population growth factor from FY 2023/24 to FY 2024/25 are 1.0012 for the County Population and 1.0047 for the City Population, which happens to be the larger of the two.
The cost-of-living growth factor from FY 2023/24 to FY 2024/25 is 1.0362. To determine the increase in the appropriations limit for FY 2024/25, the larger population growth factor is multiplied by the cost-of-living growth factor and the product is multiplied by the FY 2023/24’s Appropriation Limit. Exhibit A to this staff report demonstrates how the calculation is made.
The Appropriations subject to limitation for FY 2024/25 is $67,286,866 against the calculated limit of $218,697,177.
ATTACHMENTS: Resolution
California Department of Finance Letter Dated April 30, 2024 GANN Calculation
Report Prepared By: Laura Mendez, Senior Financial Reporting Analyst 172
Resolution No. 24 Page 1 of 1 June 17, 2024
BEFORE THE CITY COUNCIL OF THE CITY OF PITTSBURG
In the Matter of:
Approving the Appropriations Limit for )
the Fiscal Year 2024/25 in Accordance ) RESOLUTION NO. 24- with California Constitution Article XIII B )
WHEREAS, in November 1979, the voters of California approved Proposition 4, creating Article XIII B of the California Constitution and establishing expenditure limits for local jurisdictions; and
WHEREAS, Government Code Section 7910 (a) requires the City of Pittsburg to annually adopt a resolution establishing its appropriations limit for the following fiscal year; and
WHEREAS, Proposition 111 amended Article XIII B in 1990, specifying that the annual adjustment factors in calculating the appropriations limit will be increased by: (1) the change in population growth for the City or County (whichever is higher) and the change in California Per Capita Personal Income; and
WHEREAS, the Senior Financial Analyst – Reporting has made the calculations pursuant to the law and concludes that the appropriations subject to limitation is $218,697,177; and
WHEREAS, pursuant to the law, the calculations have been made available to the public for two (2) weeks prior to the date of the adoption of this resolution. A copy of the calculation has been and is on file in the City of Pittsburg Finance Department.
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Pittsburg hereby establishes the Fiscal Year 2024/25 Appropriations Limit at $218,697,177 using the City’s Population Change and the change in the California per Capita Personal Income factors.
PASSED AND ADOPTED by the City Council of the City of Pittsburg at a regular meeting on the 17th of June 2024, by the following vote:
AYES:
NOES:
ABSTAINED:
ABSENT:
__________________ _______
Juan Antonio Banales, Mayor
ATTEST:
______________________________
Alice E. Evenson, City Clerk
173
174
175
176
177
178
OFFICE OF THE CITY MANAGER/EXECUTIVE DIRECTOR
65 Civic Avenue
Pittsburg, CA 94565
TO: Mayor and Council Members
FROM: Garrett Evans, City Manager
SUBJECT: Adoption of a City Council Resolution Authorizing the City Manager to Execute a Contract with Thatcher Company of California, Inc. for Water Treatment Plant Chemical Supply – Liquid Chlorine
MEETING DATE: June 17, 2024
EXECUTIVE SUMMARY
The Public Works Department is responsible for the maintenance and operation of the City’s Water Treatment Plant and each year solicits bids for necessary chemical supplies. If approved, the resolution will authorize a purchase contract with vendor Thatcher Company of California, Inc. (Thatcher) as the only responsive bidder for Liquid Chlorine in the amount of $125,000.
FISCAL IMPACT
These funds are scheduled to be approved in the Fiscal Year 2024/25 budget for the purchase of liquid chlorine chemical supplies for the water treatment plant (501-44111).
RECOMMENDATION
Staff recommends the City Council adopt the attached Resolution authorizing the City Manager to execute a contract with Thatcher in the amount of $125,000 for Water Treatment Plant (WTP) Chemical Supply – Liquid Chlorine.
BACKGROUND
The Public Works Department manages, operates, and maintains the City’s 32 million gallon per day water treatment plant, eight distribution reservoirs, nine pumping stations and two wells, to reliably provide quality drinking water that meets or exceeds all federal and state requirements. Chemicals such as Liquid Chlorine are needed in the water treatment process.
179
The Bay Area Chemical Consortium (BACC) is a group of water and wastewater agencies in the Bay Area working together to purchase chemicals by combining bid solicitations.
Combined bid solicitations offer vendors an opportunity to sell greater quantities of their products. As a result, the 50 participating agencies, including the City, can usually obtain lower prices as a group than by bidding alone. The City has received significant savings for chemical purchases through its participation with BACC.
SUBCOMMITTEE FINDINGS
This item was not presented to a subcommittee.
STAFF ANALYSIS
Bids for the supply and delivery of Liquid Chlorine in the North Bay region were received by the BACC in February for the period of July 1, 2024, through June 30, 2025. The cost is $2,490.00 per one-ton cylinder. From past use of Liquid Chlorine at the WTP, staff estimates the cost of this chemical will total about $125,000 for the year. Pursuant to the bid request, Thatcher is the only responsive bidder.
Staff recommends the City Council authorize the City Manager to execute a contract for purchase of Liquid Chlorine in the amount of $125,000 with Thatcher.
ATTACHMENTS: Resolution
Bid Tabulation
Report Prepared By: Alexandria Augustine, Public Works Administrative Assistant 180
BEFORE THE CITY COUNCIL OF THE CITY OF PITTSBURG
In the Matter of:
Authorizing the City Manager to Execute a)
Contract for the Water Treatment ) RESOLUTION NO. 24-
Chemical Supply- Liquid Chlorine )
WHEREAS, the Public Works Department is responsible to operate and maintain the City’s Water Treatment Plant; and,
WHEREAS, Liquid Chlorine is an essential chemical to treat and provide drinking water to the residents of Pittsburg; and
WHEREAS, the Public Works Department solicits bids through the Bay Area Chemical Consortium for Water Treatment Plant Chemical Liquid Chlorine each Fiscal Year; and
WHEREAS, Thatcher Company of California, Inc., was the only responsive bidder for all local regions; and
WHEREAS, funding is scheduled to be approved in the Fiscal Year 2024/25 budget for the purchase of Liquid Chlorine for the Water Treatment Plant.
NOW, THEREFORE, BE IT RESOLVED, that the City Council of the City of Pittsburg hereby authorizes the City Manager to execute a purchase contract with Thatcher Company of California, Inc. in the amount of $125,000 for Liquid Chlorine Chemical Supply for Fiscal Year 2024/25.
PASSED AND ADOPTED by the City Council of the City of Pittsburg at a regular meeting on the 17th day of June 2024, by the following vote:
AYES:
NOES:
ABSTAINED:
ABSENT:
__________________________
Juan Antonio Banales, Mayor
ATTEST:
____________________________
Alice E. Evenson, City Clerk
181
182
183
OFFICE OF THE CITY MANAGER/EXECUTIVE DIRECTOR
65 Civic Avenue
Pittsburg, CA 94565
TO: Mayor and Council Members
FROM: Garrett Evans, City Manager
SUBJECT: Adoption of a City Council Resolution Authorizing the City Manager to Execute a Contract with Chemtrade Chemicals for Water Treatment Chemical Supply – Aluminum Sulfate
MEETING DATE: June 17, 2024
EXECUTIVE SUMMARY
The Public Works Department is responsible for the maintenance and operation of the City’s Water Treatment Plant (WTP) and each year solicits bids for necessary chemical supplies. If approved, the resolution will authorize a contract with vendor Chemtrade Chemicals US LLC as the responsive bidder for Aluminum Sulfate in the amount of $84,000.
FISCAL IMPACT
These funds are scheduled to be approved in the Fiscal Year 2024/25 budget for the purchase of Aluminum Sulfate chemical supplies for the water treatment plant (501-44111).
RECOMMENDATION
Staff recommends the City Council adopt the attached Resolution authorizing the City Manager to execute a contract with Chemtrade Chemicals US LLC in the amount of $84,000 for WTP Chemical Supply – Aluminum Sulfate.
BACKGROUND
The Public Works Department manages, operates and maintains the City’s 32 million gallon per day WTP, eight distribution reservoirs, nine pumping stations and two wells, to reliably provide quality drinking water that meets or exceeds all federal and state requirements.
Chemicals such as Aluminum Sulfate are needed in the water treatment process.
SUBCOMMITTEE FINDINGS
This item was not presented to a subcommittee.
184
STAFF ANALYSIS
The City’s Public Works Department is part of the BACC. BACC is a group of water and wastewater agencies in the Bay Area working together to purchase chemicals by combining bid solicitations. Combined bid solicitations offer vendors an opportunity to sell greater quantities of their products. As a result, the 50 participating agencies, including the City, can usually obtain lower prices as a group than by bidding alone. The City has received significant savings for chemical purchases through its participation with BACC.
Bids for the supply and delivery of Aluminum Sulfate in the East Bay region were received by the BACC in February for the period of July 1, 2024 through June 30, 2025. Chemtrade Chemicals US LLC is the responsive bidder for Aluminum Sulfate. Based on past usage of Aluminum Sulfate at the WTP, staff estimates the cost of this chemical will total about $84,000 for the year.
Staff recommends the City Council authorize the City Manager to execute a contract for purchase of Aluminum Sulfate in the amount of $84,000 with Chemtrade Chemicals.
ATTACHMENTS: Resolution
Bid Results
Report Prepared By: Alexandria Augustine, Administrative Assistant 185
BEFORE THE CITY COUNCIL OF THE CITY OF PITTSBURG
In the Matter of:
Authorizing the City Manager to Execute a)
Contract for Water Treatment Chemical ) RESOLUTION NO. 24- Supply - Aluminum Sulfate )
WHEREAS, the Public Works Department is responsible to operate and maintain the City’s Water Treatment Plant; and,
WHEREAS, Aluminum Sulfate is an essential chemical to treat and provide drinking water to the residents of Pittsburg; and
WHEREAS, the Public Works Department solicits bids through the Bay Area Chemical Consortium for Water Treatment Plant Chemical Aluminum Sulfate each Fiscal Year; and
WHEREAS, Chemtrade Chemicals, Inc., was the most responsive bidder for all local regions; and
WHEREAS, funding is scheduled to be approved in the Fiscal Year 2024/25 budget for the purchase of Aluminum Sulfate chemical supplies for the Water Treatment Plant.
NOW, THEREFORE BE IT RESOLVED, that the City Council of the City of Pittsburg hereby authorizes the City Manager to execute a purchase contract with Chemtrade Chemicals, Inc. in the amount of $84,000 for Aluminum Sulfate Chemical Supply for FY 2024/25.
PASSED AND ADOPTED by the City Council of the City of Pittsburg at a regular meeting on the 17th day of June 2024, by the following vote:
AYES:
NOES:
ABSTAINED:
ABSENT:
__________________________
Juan Antonio Banales, Mayor
ATTEST:
____________________________
186
Alice E. Evenson, City Clerk
187
Bay Area Clean Water Agencies
Bay Area Clean Water Agencies
Bid Results for Project 01-2024 ALUMINUM SULFATE
Bid Due on February 22, 2024 4:00 PM (PDT)
SINGLE BID AWARD
Section
Description Central Valley East Bay North Bay Sacramento South Bay Tri Valley Unit of Measure gal gal gal gal gal gal
Univar Solutions USA Inc. no bid no bid no bid no bid no bid Chemtrade Chemicals, LLC US 0.8403 0.8403 0.8403 0.8403 0.8403 0.8403 Thatcher Company of California, Inc. 0.9100 0.9100 0.9100 0.8500 1.1100 0.9100 Single Bid Award
Aggregate Cost Calculation: Central Valley East Bay North Bay Sacramento South Bay Tri Valley Estimated annual quantity 210,788 160,000 1,215,900 1,231,000 750,000 902,000 Univar Solutions USA Inc. N/A N/A N/A N/A N/A N/A
Chemtrade Chemicals, LLC US $177,125.16 $134,448.00 $1,021,720.77 $1,034,409.30 $630,225.00 $757,950.60 $3,755,878.83 overall lowest Thatcher Company of California, Inc. $191,817.08 $145,600.00 $1,106,469.00 $1,046,350.00 $832,500.00 $820,820.00 $3,951,739.00
2.16 Method of Award
Bids may be awarded to the lowest responsive and responsible bidder meeting the specifications for bulk loads for the chemical. The lowest responsive bidder will be determined by multiplying the estimated annual quantity for each participating BACC agency by the bid price for their region and adding up the aggregate cost to all of the participating agencies in the regions. The single bid that results in the lowest overall cost to the participating agencies as a group will be determined by BACC to be the low bid, assuming the bid is determined by BACC to be complete and in compliance with the bid requirements. BACC has the right to delete terms or options from the bid contract documents and reserves the right to reject any and all bids and to waive irregularities in said bids.
ALUMINUM SULFATE 44%-49% Liquid Solution
44% - 49% Liquid Solution
188
OFFICE OF THE CITY MANAGER/EXECUTIVE DIRECTOR
65 Civic Avenue
Pittsburg, CA 94565
TO: Mayor and Council Members
FROM: Garrett Evans, City Manager
SUBJECT: Adoption of a City Council Resolution to Authorize City Manager to Execute a Contract with Univar USA, Inc. for Water Treatment Plant Chemical Supply – Sodium Hydroxide
MEETING DATE: June 17, 2024
EXECUTIVE SUMMARY
The Public Works Department is responsible for the maintenance and operation of the City’s Water Treatment Plant (WTP) and each year solicits bids for necessary chemical supplies. If approved, the resolution will authorize a purchase contract with vendor Univar USA, Inc. as the lowest responsible, responsive bidder for Sodium Hydroxide (Caustic Soda) in the amount of $225,000.
FISCAL IMPACT
These funds are scheduled to be approved in the Fiscal Year 2024/25 budget for the purchase of Sodium Hydroxide chemical supplies for the water treatment plant (501-44111).
RECOMMENDATION
Staff recommends the City Council adopt the attached Resolution authorizing the City Manager to execute a contract with Univar USA Inc. in the amount of $225,000 for WTP Chemical Supply – Sodium Hydroxide.
BACKGROUND
The Public Works Department manages, operates, and maintains the City’s 32 million gallon per day WTP, eight distribution reservoirs, nine pumping stations and two wells, to reliably provide quality drinking water that meets or exceeds all federal and state requirements.
Chemicals such as Sodium Hydroxide (Caustic Soda) are needed in the water treatment process.
SUBCOMMITTEE FINDINGS
This item was not presented to a subcommittee.
189
STAFF ANALYSIS
The City’s Public Works Department is part of the BACC. BACC is a group of water and wastewater agencies in the Bay Area working together to purchase chemicals by combining bid solicitations. Combined bid solicitations offer vendors an opportunity to sell greater quantities of their products. As a result, the 50 participating agencies, including the City, can usually obtain lower prices as a group than by bidding alone. The City has received significant savings for chemical purchases through its participation with BACC.
Bids for the supply and delivery of Sodium Hydroxide in the East Bay region were received by the BACC in February for the period of July 1, 2024, through June 30, 2025. Based on past usage of Sodium Hydroxide at the WTP, staff estimates the cost of this chemical will total about $225,000 for the year.
Staff recommends the City Council authorize the City Manager to execute a contract for purchase of Sodium Hydroxide in the amount of $225,000 with Univar USA Inc.
ATTACHMENTS: Bid Response Table
Resolution
Report Prepared By: John Samuelson, Public Works Director 190
Bay Area Clean Water Agencies
Bid Results for Project 12-2024 SODIUM HYDROXIDE
Bid Due on February 22, 2024 4:00 PM (PT)
Number of Addendum Issued: One (1)
REGIONAL AWARD Univar Brenntag
Item #
BACC RECOMMENDATION Sodium Hydroxide 20% Sacramento; Sodium Hydroxide 25% Sacramento, Central Valley;
Sodium Hydroxide 30% North Bay,
Sacramento; Sodium Hydroxide 50% Central
Valley, East Bay, North Bay, Sacramento
Sodium Hydroxide 20% Marin Sonoma
Napa; Sodium Hydroxide 25% Marin
Sonoma Napa,Peninsula, South Bay, Tri
Valley; Sodium Hydroxide 30% Marin
Sonoma Napa, South Bay; Sodium
Hydroxide 50% Marin Sonoma Napa, Tri
Valley
1 Received via bid platform by bid deadline above y y
2 Bids submitted on forms provided y y
3 Must include a base unit price for each geographic area y y 4 Additional charges for "short load" deliveries shown as a standard deviation on bid form
yes - see below
n
5 References: minimum of 3 y y
6 Product Specification Deviations - if any, proposed
specification must be attached
yes - see below
n
7 Fully Executed Standard Agreement y y
8 Fully Executed Non-Collusion Affidavit y y
9 For potable application only: Affidavit of Compliance to AWWA and/or NSF standard or Statement by chemical
manufacturer, signed on letterhead attesting to the
affidavit's validity or current printout from NSF.org
y
y
10 Representative lab analysis of the chemical prepared by reputable outside laboratory or ISO Certified
y
y
11 Name /Address of chemical manufacturer K2 950 and Univar - see below Same 12 Product Bulletin and Typical Properties y y
13 Safety Data Sheet (SDS) y y
14 Addendum/Addenda Acknowledgement no y
15 Third Party Hauler? If applicable, name, address, y n 16 Specific Deviations Noted yes - see below n
#4, 6 & 16 Univar
191
192
193
194
#11 Univar
195
196
BEFORE THE CITY COUNCIL OF THE CITY OF PITTSBURG
In the Matter of:
Authorizing the City Manager to Execute a)
Contract for the Water Treatment ) RESOLUTION NO. 24-
Chemical Supply- Sodium Hydroxide )
WHEREAS, the Public Works Department is responsible to operate and maintain the City’s Water Treatment Plant; and,
WHEREAS, Sodium Hydroxide is an essential chemical to treat and provide drinking water to the residents of Pittsburg; and
WHEREAS, the Public Works Department solicits bids through the Bay Area Chemical Consortium for Water Treatment Plant Chemical Sodium Hydroxide (Caustic Soda) each Fiscal Year; and
WHEREAS, Univar Solutions USA, Inc., was determined to be the lowest responsive, responsible bidder for all local regions; and WHEREAS, funding is available in the Fiscal Year 2024/25 Water Operations budget.
NOW, THEREFORE BE IT RESOLVED, that the City Council of the City of Pittsburg hereby authorizes the City Manager to execute a purchase contract with Univar Solutions USA, Inc. in the amount of $225,000 for Sodium Hydroxide Chemical Supply for FY 2024-2025.
PASSED AND ADOPTED by the City Council of the City of Pittsburg at a regular meeting on the 17th day of June 2024, by the following vote:
AYES:
NOES:
ABSTAINED:
ABSENT:
__________________________
Juan Antonio Banales, Mayor
ATTEST:
____________________________
197
Alice E. Evenson, City Clerk
198
OFFICE OF THE CITY MANAGER/EXECUTIVE DIRECTOR
65 Civic Avenue
Pittsburg, CA 94565
TO: Mayor and Council Members
FROM: Garrett Evans, City Manager
SUBJECT: Adoption of a City Council Resolution Authorizing the City Manager to Execute a Contract with Neo Solutions, Inc. for Water Treatment Plant Chemical Supply – Cationic Polymer
MEETING DATE: June 17, 2024
EXECUTIVE SUMMARY
The Public Works Department is responsible for the maintenance and operation of the City’s Water Treatment Plant (WTP) and each year solicits bids for necessary chemical supplies. If approved, the resolution will authorize a purchase contract with vendor Neo Solutions, Inc. in an amount up to $170,000 for Cationic Polymer.
FISCAL IMPACT
These funds are scheduled to be approved in the Fiscal Year 2024/25 budget for the purchase of Cationic Polymer chemical supplies for the water treatment plant (501-44111).
RECOMMENDATION
City Council adopt the attached Resolution authorizing the City Manager to execute a contract with Neo Solutions, Inc. in the amount of $170,000 for Cationic Polymer.
BACKGROUND
The Public Works Department manages the operation and maintenance for the City’s 32 million gallon per day WTP, eight distribution reservoirs, nine pumping stations and two wells, to reliably provide adequate supplies of highest quality drinking water that meet or exceed all federal and state requirements. Chemicals such as Cationic Polymer are necessary for the water treatment process.
The current contract with Neo Solutions, Inc. for Cationic Polymer expires on June 30, 2024.
SUBCOMMITTEE FINDINGS
This item was not presented to a subcommittee.
199
STAFF ANALYSIS
Water Treatment Plant staff developed and solicited bids from potential vendors for various chemicals necessary for the processes at the Water Treatment Plant. Bids were opened on April 25, 2024, and Neo Solutions, Inc. was the only responsive bidder for Cationic Polymer.
Staff recommends the City Council accept the bid submitted by Neo Solutions, Inc. as the only responsive bid submitted and authorize the City Manager to execute a contract with Neo Solutions, Inc. in the amount of $170,000 for purchase of Cationic Polymer.
ATTACHMENTS: Resolution
Bid Response Table
Report Prepared By: Alexandria Augustine, Public Works Administrative Assistant 200
BID TABULATION
City of Pittsburg
WTP CHEMICALS (WTC42524)
2024-2025
Bids opened - April 25, 2024 at 11:00 am by City of Pittsburg
COMPANY Cationic Polymer Sodium Chlorite
Bid Quantity - Total up to 80 tons up to 90 tons
$/ton $/ton
International Dioxcide, Inc. No Bid $1,652.000
Neo Solutions, Inc. $2,120.00 No Bid
Univar USA No Bid No Bid
201
BEFORE THE CITY COUNCIL OF THE CITY OF PITTSBURG
In the Matter of:
Authorizing the City Manager to Execute a)
Contract for Water Treatment Chemical ) RESOLUTION NO. 24- Supply - Cationic Polymer )
WHEREAS, the Public Works Department is responsible to operate and maintain the City’s Water Treatment Plant; and,
WHEREAS, Cationic Polymer is an essential chemical to treat and provide drinking water to the residents of Pittsburg; and
WHEREAS, the Public Works Department solicited bids from potential vendors for Cationic Polymer; and
WHEREAS, Neo Solutions, Inc., was the only responsible, responsive bidder; and WHEREAS, funding is scheduled to be approved in the Fiscal Year 2024/25 budget for the purchase of Cationic Polymer chemical supplies for the water treatment plant (501- 44111).
NOW, THEREFORE BE IT RESOLVED, that the City Council of the City of Pittsburg hereby authorizes the City Manager to execute a purchase contract with Neo Solutions, Inc. in the amount of $170,000 for Cationic Polymer Chemical Supply for FY 2024/25.
PASSED AND ADOPTED by the City Council of the City of Pittsburg at a regular meeting on the 17th day of June 2024, by the following vote:
AYES:
NOES:
ABSTAINED:
ABSENT:
__________________________
Juan Antonio Banales, Mayor
ATTEST:
____________________________
Alice E. Evenson, City Clerk
202
OFFICE OF THE CITY MANAGER/EXECUTIVE DIRECTOR
65 Civic Avenue
Pittsburg, CA 94565
TO: Mayor and Council Members
FROM: Garrett Evans, City Manager
SUBJECT: Adoption of a City Council Resolution Authorizing the City Manager to Execute a Contract with International Dioxcide for Water Treatment Plant Chemical Supply – Sodium Chlorite
MEETING DATE: June 17, 2024
EXECUTIVE SUMMARY
The Public Works Department is responsible for the maintenance and operation of the City’s Water Treatment Plant (WTP) and solicits bids for necessary chemical supplies. If approved, the resolution will authorize a purchase contract with vendor International Dioxcide, Inc. in an amount up to $150,000 for Sodium Chlorite.
FISCAL IMPACT
Funds are scheduled to be approved in the Fiscal Year 2024/25 budget for the purchase of Sodium Chlorite chemical supplies for the Water Treatment Plant (501-44111).
RECOMMENDATION
Staff recommends the City Council adopt the attached Resolution authorizing the City Manager to execute a contract with International Dioxcide, Inc. in the amount of $150,000 for purchase of Sodium Chlorite.
BACKGROUND
The Public Works Department manages the operation and maintenance of the City’s 32 million gallon per day WTP, eight distribution reservoirs, nine pumping stations and two wells, to reliably provide adequate supplies of highest quality drinking water that meet or exceed all federal and state requirements. Chemicals such as Sodium Chlorite are necessary for the water treatment process.
The current contract with International Dioxcide, Inc. for Sodium Chlorite expires on June 30, 2024.
203
SUBCOMMITTEE FINDINGS
This item was not presented to a subcommittee.
STAFF ANALYSIS
Water Treatment Plant staff developed and solicited bids from potential vendors for various chemicals necessary for the processes at the WTP. On April 25, 2024, bids were opened, and International Dioxcide, Inc. was the only responsive bidder for Sodium Chlorite.
Staff recommends the City Council accept the bid submitted by International Dioxcide, Inc. as the only responsive bid submitted and authorize the City Manager to execute a contract with International Dioxcide, Inc. in the amount of $150,000 for purchase of Sodium Chlorite.
ATTACHMENTS: Resolution
Bid Tabulation
Report Prepared By: Alexandria Augustine, Administrative Assistant 204
BID TABULATION
City of Pittsburg
WTP CHEMICALS (WTC42524)
2024-2025
Bids opened - April 25, 2024 at 11:00 am by City of Pittsburg
COMPANY Cationic Polymer Sodium Chlorite
Bid Quantity - Total up to 80 tons up to 90 tons
$/ton $/ton
International Dioxcide, Inc. No Bid $1,652.000
Neo Solutions, Inc. $2,120.00 No Bid
Univar USA No Bid No Bid
205
BEFORE THE CITY COUNCIL OF THE CITY OF PITTSBURG
In the Matter of:
Authorizing the City Manager to Execute a)
Contract for the Water Treatment ) RESOLUTION NO. 24-
Chemical Supply – Sodium Chlorite )
WHEREAS, the Public Works Department is responsible to operate and maintain the City’s Water Treatment Plant; and,
WHEREAS, Sodium Chlorite is an essential chemical to treat and provide drinking water to the residents of Pittsburg; and
WHEREAS, the Public Works Department solicited bids from potential vendors for Sodium Chlorite; and
WHEREAS, International Dioxide, Inc., was the only responsible, responsive bidder; and
WHEREAS, funding is available in the Fiscal Year 2024/25 Water Operations budget.
NOW, THEREFORE BE IT RESOLVED, that the City Council of the City of Pittsburg hereby authorizes the City Manager to execute a purchase contract with International Dioxide, Inc. in the amount of $150,000 for Sodium Chlorite Chemical Supply for FY 2024/25.
PASSED AND ADOPTED by the City Council of the City of Pittsburg at a regular meeting on the 17th day of June 2024, by the following vote:
AYES:
NOES:
ABSTAINED:
ABSENT:
__________________________
Juan Antonio Banales, Mayor
ATTEST:
____________________________
Alice E. Evenson, City Clerk
206
OFFICE OF THE CITY MANAGER/EXECUTIVE DIRECTOR
65 Civic Avenue
Pittsburg, CA 94565
TO: Mayor/Chair and Council/Governing Board Members
FROM: Garrett Evans, Executive Director/City Manager
SUBJECT: Adoption of a City Council Resolution to Authorize the City Manager to Negotiate and Execute a Loan Agreement for Energy Efficiency Improvements and Adoption of a Pittsburg Power Company Resolution Allocating Funds
MEETING DATE: June 17, 2024
EXECUTIVE SUMMARY
Approval of the proposed City Council resolution would authorize the City Manager to negotiate and execute a loan agreement with Sean McCauley Investments (SMI) to facilitate energy efficiency improvements to Assessor’s Parcel Number (APN) 085-390-077, commonly known as Vidrio Commercial. Approval of the proposed Pittsburg Power Company (PPC) resolution would allocate $300,000 to fund the loan.
FISCAL IMPACT
The proposed adoption of the PPC resolution would allocate $300,000 from PPC fund balance (Fund 590) to fund the loan. The principal would be paid back over the course of the loan term through sales taxes recouped via the businesses in Vidrio Commercial with any remaining principal due payable no later than December 31, 2034.
RECOMMENDATION
Staff recommends the City Council adopt the attached resolution authorizing the City Manager to negotiate and execute a loan agreement with SMI for an amount not-to-exceed $300,000.
Staff further recommends the Governing Board of PPC adopt the attached resolution allocating funds in an amount not-to-exceed $300,000 to fund the City-backed loan. 207
BACKGROUND
In 2022, SMI purchased Vidrio Commercial from the Successor Agency to the Redevelopment Agency of the City of Pittsburg. Since then, SMI has invested significant funding to convert a portion of the commercial space to the Luxe Salon Suites, and is seeking to convert the southernmost space (690 Railroad Avenue) to a restaurant. As part of these renovations, the City and PPC have identified an opportunity to partner with SMI to bring energy enhancements to Vidrio Commercial, consistent with multiple goals of the PPC, City Sustainability Plan, and recently adopted General Plan.
SUBCOMMITTEE FINDINGS
This item was not presented to a subcommittee.
STAFF ANALYSIS
Funding of the proposed loan would help the City meet several city-wide goals ranging from Economic Development to sustainability to job creation. The loan would assist SMI in establishing a second restaurant space in the Vidrio Commercial area, as well as energy efficiency upgrades that would allow tenants to increase revenues while reducing operating expenses.
The draft term sheet attached as Exhibit A to this Staff Report provides general terms agreed upon in principle between the City and SMI. These terms include:
- City will provide a loan of $300,000 to complete energy efficiency upgrades. - SMI shall be required to construct, cause the construction of, or lease space to at least two (2) restaurants at APN 085-390-077.
- Restaurant(s) shall be categorized as “Full-Service Restaurant” as defined by Pittsburg Municipal Code (PMC) section 18.08.080(13)(b); however, this shall not preclude the full-service restaurant from serving alcohol, providing to-go orders, or including a self-service component.
- Restaurant(s) shall be operational no later than March 1, 2025.
The loan terms are further specified in Exhibit A. Notably, the loan principal will be repayable December 31, 2034; however, the loan principal shall be reduced each year by the collective sales taxes generated by the businesses located within APN 085-390-077.
For example, if the businesses within APN: 085-390-077 generate $30,000 in Year 1 and $35,000 in Year 2, the loan principal due payable shall be $235,000. ($300,000 - $65,000 = $235,000).
ATTACHMENTS: 1. Proposed City Council Resolution
2. Proposed Pittsburg Power Company Resolution
3. Draft Term Sheet
Report Prepared By: Jordan Davis, Director of Community and Economic Development 208
Resolution No. 24- Page 1 of 1 June 17, 2024
BEFORE THE CITY COUNCIL OF THE CITY OF PITTSBURG
In the Matter of:
Authorizing the City Manager to Negotiate ) RESOLUTION NO. 24- And Execute a Loan Agreement for Energy )
Efficiency Improvements )
WHEREAS, in 2022, Sean McCauley Investments (SMI) purchased the Vidrio Commercial area (APN: 085-390-077) from the Successor Agency to the Redevelopment Agency of the City of Pittsburg; and
WHEREAS, since then, SMI has invested significant funding to convert a portion of the commercial space to the Luxe Salon Suites, and is seeking to convert the southernmost space (690 Railroad Avenue) to a restaurant; and WHEREAS, as part of these renovations, the City and PPC have identified an opportunity to partner with SMI to bring energy efficiency enhancements to Vidrio Commercial, consistent with multiple goals of the Pittsburg Power Company (PPC), City Sustainability Plan, and recently adopted General Plan; and WHEREAS, funding of the proposed loan would help the City meet several city-wide goals ranging from Economic Development to sustainability to job creation; and WHEREAS, the loan would assist SMI is establishing a second restaurant space in Vidrio Commercial, as well an energy efficiency upgrades that would allow tenants to increase revenues while reducing operating expenses; and WHEREAS, the City and SMI have mutually agreed to a draft term sheet that will guide the City’s negotiations for the final loan.
NOW, THEREFORE BE IT RESOLVED that the City Council of the City of Pittsburg hereby authorizes the City Manager to negotiate and execute a loan agreement with SMI in an amount not-to-exceed $300,000 for energy efficiency upgrades.
PASSED AND ADOPTED by the City Council of the City of Pittsburg at a regular meeting on the 17th day of June 2024, by the following vote:
AYES:
NOES:
ABSTAINED:
ABSENT:
________________________________
Juan Antonio Banales, Mayor
ATTEST:
_________________________
Alice E. Evenson, City Clerk
209
Resolution No. 24- Page 1 of 1 June 17, 2024
BEFORE THE GOVERNING BOARD OF THE PITTSBURG POWER COMPANY
In the Matter of:
Allocating Funds in the Amount of ) RESOLUTION NO. 24-
$300,000 to Fund a Loan Agreement for )
Energy Efficiency Improvements )
WHEREAS, in 2022, Sean McCauley Investments (SM)I purchased the Vidrio Commercial area (APN: 085-390-077) from the Successor Agency to the Redevelopment Agency of the City of Pittsburg; and
WHEREAS, since then, SMI has invested significant funding to convert a portion of the commercial space to the Luxe Salon Suites, and is seeking to convert the southernmost space (690 Railroad Avenue) to a restaurant; and WHEREAS, it is a stated goal of the Pittsburg Power Company to seek and support opportunities to enact energy efficiency improvements in commercial areas.
NOW, THEREFORE, BE IT RESOLVED that the Governing Board of the Pittsburg Power Company hereby allocates $300,000 to fund a loan for energy efficiency upgrades.
PASSED AND ADOPTED by the Governing Board of the Pittsburg Power Company at a regular meeting on the 17th day of June 2024, by the following vote:
AYES:
NOES:
ABSTAINED:
ABSENT:
________________________________
Juan Antonio Banales, Chair
ATTEST:
____________________________
Garrett Evans, Executive Secretary
210
Railroad Restaurant Term Sheet
Objective.
The Pittsburg Power Company (PPC) is proposing to fund a City issued loan to Sean McCauley Investments (SMI) with a loan of $300,000 to complete energy efficiency improvements to the commercial space at 690 Railroad Avenue. The Space at 690 Railroad Avenue is intended to be used as a restaurant.
Proposed Terms.
Obligations of City:
- City will provide a loan of $300,000 to complete energy efficiency upgrades.
Obligations of SMI:
- SMI shall be required to construct, cause the construction of, or lease space to at least two (2) restaurants at APN 085-390-077.
o Restaurant(s) shall be categorized as “Full-Service Restaurant” as defined by Pittsburg Municipal Code (PMC) section 18.08.080(13)(b); however, this shall not preclude the full-service restaurant from serving alcohol, providing to-go orders, or including a self-service component. o Restaurant Shall be operational no later than March 1, 2025.
Loan Terms:
- Loan will carry no interest rate.
- Loan principal will be repayable December 31, 2034.
- Loan principal shall be reduced each year by the sales tax generated by the businesses located within APN 085-390-077.
o For example, if the businesses within APN: 085-390-077 collectively generate $30,000 in Year 1 and $35,000 in Year 2, the loan principal due payable shall be $235,000. ($300,000 - $65,000 = $235,000). - Loan Principal shall be due payable upon:
o The sale of SMI-owned property (APN 085-390-077).
o The closure of a restaurant that is not replaced by another restaurant within twelve (12) consecutive months (may be extended by up to 12 additional months at the sole discretion of the City Manager). o The occupancy of a non-restaurant tenant in a restaurant space. o The condominium conversion of APN 085-390-077 without the City Manager approval.
- The loan may be assigned to another party with City Manager approval.
Assignment will only be considered after potential assignee has been vetted by the City.
211
OFFICE OF THE CITY MANAGER/EXECUTIVE DIRECTOR
65 Civic Avenue
Pittsburg, CA 94565
TO: Mayor and Council Members
FROM: Garrett Evans, Executive Director
SUBJECT: Adoption of a City Council Resolution Reallocating Funds, Establishing a Measure M Reserve, and Establishing a Youth Fund
MEETING DATE: June 17, 2024
EXECUTIVE SUMMARY
The City Council previously allocated $18.4 million in ARPA, Measure M Surplus, General Fund, General Fund Surplus, and Park Dedication Funds (PDF) to various projects. Due to increased project costs, changing project scopes, the evolution of the State and Local Fiscal Recovery Funds Final Rule, and required General Fund reserves, this item proposes reallocation of these funds to other revenue sources. The City Council also directed staff to utilize Measure M Surplus funds to establish an annual Measure M Reserve and a Youth Fund. This item will reallocate project funds and formally establish the Measure M Reserve and Youth Fund as directed.
FISCAL IMPACT
This item will divert $6,828,288 in General Fund and $1,250,000 in General Fund Surplus expenditures to other funding sources such as ARPA.
RECOMMENDATION
City Council adopt the Resolution to:
• Reallocate $8,206,000 from the Pittsburg Premier Fields Project (Project 3080) to source funds including $6,078,288 to the General Fund, $1,152,712 to the Park Dedication Fund, $150,000 to Fiscal Year 2022/23 Measure M Surplus, and $825,000 to Fiscal Year 2023/24 Measure M Surplus • Reallocate $500,000 from the Buchanan Park Restrooms Project (Project 1753) to the General Fund
• Reallocate $750,000 from the City Park Restrooms Project (Project 1754) to the General Fund
• Reallocate $400,000 from the California Avenue Full Trash Capture Device Project to the General Fund
212
• Reallocate $750,000 from the Police Camera Servers Replacement Project (Project 3090) to the General Fund
This Resolution will also allocate:
• $9,792,811 from ARPA Revenue Replacement (Fund 298) to create a Sports Tourism project
• $1.25 million to Project 1754 for the City Park Restrooms Project • $120,000 ARPA funds to Project 1803 for Pittsburg Eats! • $750,000 ARPA funds to Project 3090 for replacement of the Police camera server
• $2,068,227 ARPA funds to Project for the Enterprise Resource Planning software replacement
• $200,000 Fiscal Year 2022/23 Measure M Surplus funds to the Measure M Reserve
• $200,000 Fiscal Year 2022/23 Measure M Surplus funds to create a Youth Fund
BACKGROUND
On May 9, 2022, as part of the Fiscal Year 2022/23 budget workshop, the City Council developed spending priorities for three unique revenue sources: American Rescue Plan Act (ARPA), Measure M Surplus and General Fund Surplus. The funding priorities included Youth, Public Safety, Non-profit Assistance, Public Art, Economic Development, Parks/Landscape, Tourism, and Infrastructure.
ARPA: The City received $16,290,477 in American Rescue Plan Act funding to address public health, economic impacts, community services, infrastructure, and lost revenues due to the COVID-19 pandemic. These funds must be obligated by the end of 2024 and spent by the end of 2026.
Measure M Surplus: Measure M is an extension of Measure P passed by Pittsburg voters in June 2012 as a limited one-half percent sale and use tax. The City Council annually assigns $4.9 million to fund economic development, senior, youth, streets, and public safety initiatives. Above this $4.9 million, the City experiences approximately $1.2 million in annual Measure M surplus revenues eligible for expenditure across the same five priority areas.
General Fund Surplus: In Fiscal Year 2020/21, largely due to the COVID-19 pandemic, the City’s General Fund experienced an uncharacteristically large surplus at $7,851,300, and has experienced smaller surpluses in Fiscal Years 2021/22 and FY 2022/23.
SUBCOMMITTEE FINDINGS
This item was supported by the Budget Sustainability Ad-Hoc Subcommittee on June 7, 2024.
STAFF ANALYSIS
The City’s General Fund has and will continue to experience a reduction in revenues due to the relocation of Bombardier, UPI, and closing of several big box retail and restaurant locations. In addition, winter storms, evolving ARPA expenditure rules, hikes in project costs, increased staffing since the COVID-19 pandemic, and other impacts to the General 213
Fund have increased costs. The City Council has refined funding priorities identified at the May 9, 2022 workshop as needed, and found a diversion of one-time expenses from General Fund to the special funds identified above as a fiscally responsible method for maintaining a balanced budget. The following reflects updated priorities and diversion of General Fund expenses to special funding sources and is summarized in Attachment 2.
Youth
On June 30, 2022 and July 18, 2022 through Resolutions 22-14042 and 22-14132, the City Council allocated $600,000 and $215,000 Park Dedication Funds to the Pittsburg Premier Fields Project (Project 3080) for design. On August 7, 2023, through Resolution 23-14356, the City Council also allocated the following funds to the Project 3080.
Funding Source Allocation
General Fund $6,078,288
FY 2020-2021 General Fund Surplus $1,615,000
Park Dedication Fund $337,712
FY 2022-2023 Measure M Surplus $150,000
FY 2023-2024 Measure M Surplus $825,000
Total $9,000,000
This project proposes several outdoor multi-use sports fields, accompanying amenities, and traffic calming measures at the former golf course to connect the project to the Dream Courts across Leland Road. City Council’s allocation provided matching funds for a $6 million Land and Water Conservation Fund (LWCF) grant opportunity.
The City did not receive the LWCF grant and as a result has reduced the Pittsburg Premier Fields Project scope and identified ARPA as an appropriate source of funding for this project. When combined with the $6,750,000 ARPA dollars funding the Dream Courts Project, the Council is committing nearly $9,500,000 in ARPA funds to sports tourism projects that benefit local youth and families currently traveling to sports tournaments while acting as an economic development driver for many supporting businesses. With the exception of $1,615,000 Fiscal Year 2020/21 General Fund Surplus dollars for design of the project, all funds allocated to Project 3080 through Resolutions 22-14042, 22-14132, and 23-14356 will be returned to their respective funding sources shown in the table above for use on another qualifying project.
Additionally, members of the City Council have expressed interest in programming Fiscal Year 2022/23 Measure M Surplus fund to establish a Youth Fund for implementation of youth programs not already budgeted in the Recreation Department. The $200,000 Youth Fund would support youth programming beyond the Department of Recreation’s typical services benefiting Pittsburg Youth as directed by the City Council. This item was included in the Fiscal Year 2022/23 Measure M Surplus budget but not allocated.
Parks/Landscape
On June 19, 2023 through Resolution 23-14318 City Council adopted the 5-year Capital Improvements Program which included $750,000 for new restrooms at City Park (Project 1754) and $500,000 for new restrooms at Buchanan Park (Project 1753) funded by the General Fund Surplus. Project costs have increased, and City Park restrooms alone have an estimated cost of $1.25 million. Staff considers ARPA a feasible funding source for park restroom projects as cities like Detroit and Tucson have used ARPA to fund $5 million and 214
$3.45 million parks improvement projects impacting disadvantaged communities similar to the neighborhoods directly adjacent to City Park. General Fund Surplus dollars allocated to Projects 1753 and 1754 through Resolution 23-14318 will be returned to the Fiscal Year 2022/23 General Fund Surplus and $1.25 million in ARPA funds will be allocated to the City Park Restroom Project (Project 1754).
Infrastructure
On June 19, 2023 through Resolution 23-14318, the City Council allocated $400,000 to the California Avenue Full Trash Capture Device Project to treat a drainage area of 819 acres of City public and private properties and 20 acres of Caltrans right of way, the southeastern corner of Loveridge Road and California Avenue. This project is funded in part by Caltrans whose portion of the funding is not expected until 2026. ARPA funds are required to be obligated by December 2024 and spent by December 2026, rendering this an infeasible funding source for the project. The funds will be returned to ARPA for use on another qualifying project, and a new funding source will be identified.
Economic Development
On May 1, 2023 through Resolution 23-14294, the City Council allocated $200,000 ARPA funds for a contract with Cal Poly Humboldt Sponsored Programs Foundation’s Northern California Small Business Development Center (NorCal SBDC) for administration of the Pittsburg Eats! Program (Project 1803). Pittsburg Eats! is a local business coaching program focused on assisting restaurants in rebounding from the COVID-19 pandemic through a small business training program, one-on-one expert advising sessions, and grants of up to $10,000. This program has been impactful for 13 participants including La Veranda, Nick’s Sandwiches, DiDi Coco’s, Lady J’s Soul Food, New Mecca Café, Fiya Spice, Oysters Ooh LaLa, Ube Area, Lunahuana, Little J’s and more. In alignment with the Council’s May 9, 2022 earmark, staff recommends an additional $120,000 allocation to this program from ARPA to continue its expansion and impact on the local business community and economy.
Efficiency
On July 17, 2023 through Resolution 23-14339, the City Council awarded a $750,000 contract with Weaver Technologies to replace end of life VMWare infrastructure supporting the Police Department (Project 3090). Funding for this project included Fiscal Year 2022/23 and Fiscal Year 2023/24 General Fund dollars.
Staff considers ARPA a feasible funding source for IT-driven efficiency solutions as cities like Atlanta and Chicago that have spent several million dollars on one-time investments in technology that better allows their jurisdiction to purvey essential government services.
Therefore $750,000 General Fund dollars allocated to the project through Resolution 23- 14339 will be returned to the General Fund and $750,000 ARPA funds will be allocated to Project 3090.
Similarly, due to discontinuation of the City’s current Enterprise Resource Planning (ERP) software, Eden, the City is replacing its ERP technology with Tyler and NEOGOV. In December 2022, the City released a request for proposals for and ERP system and worked with the Government Finance Officers Association over the course of a year to refine the City’s needs and prioritize a vendor and product. Staff recommends allocation of $2,068,227 from ARPA to this project.
215
Lastly, the Finance Management Subcommittee recommended that staff create a $200,000 Measure M Reserve for emergency expenditures in line with the priority areas. The $200,000 Measure M Reserve would be for emergency or unexpected high priority expenditures that align with the five Measure M expense categories. This item was included in the Fiscal Year 2022/23 Measure M Surplus budget but not designated as Reserve funds separate from Surplus funds.
ATTACHMENTS: Resolution
Projects Funding Summary
Report prepared by: Sara Bellafronte, Assistant to the City Manager 216
Resolution No. 24- Page 1 of 2 June 17, 2024
BEFORE THE CITY COUNCIL OF THE CITY OF PITTSBURG
In the Matter Of:
Reallocating Funds, Establishing a )
Measure M Reserve, and Establishing a ) RESOLUTION NO. 24- Youth Fund )
WHEREAS, on May 9, 2022, as part of the Fiscal Year 2022/23 budget workshop, the City Council developed spending priorities for three unique revenue sources: American Rescue Plan Act (ARPA), Measure M Surplus and General Fund Surplus; and WHEREAS, in alignment with these priorities, the City Council has allocated $18.4 million in ARPA, Measure M Surplus, General Fund, General Fund Surplus, and Park Dedication Funds to various projects; and
WHEREAS, the City’s General Fund has and will continue to experience a reduction in revenues due to the relocation of Bombardier, UPI, and closing of several big box retail and restaurant locations. In addition, winter storms, evolving ARPA expenditure rules, hikes in project costs, increased staffing since the COVID-19 pandemic, and other impacts to the General Fund have increased costs; and
WHEREAS, the City Council has since refined funding priorities identified at the May 9, 2022 workshop as needed, and a diversion of one-time expenses from General Fund to ARPA, Measure M Surplus, and General Fund Surplus is a fiscally responsible method for maintaining a balanced budget; and
WHEREAS, the Finance Management Subcommittee recommended that staff create a $200,000 Measure M Reserve for emergency expenditures in line with Measure M’s priorities of Youth, Seniors, Public Safety, Economic Development, and Streets; and WHEREAS, members of the City Council have expressed interest in programming Fiscal Year 2022/23 Measure M Surplus fund to establish a Youth Fund for implementation of youth programs not already budgeted in the Recreation Department; and WHEREAS, both the $200,000 for a Measure M Reserve and $200,000 for a Youth Fund were included in the Fiscal Year 2022/23 budget but not allocated.
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Pittsburg hereby reallocates:
$8,206,000 from the Pittsburg Premier Fields Project (Project 3080) to source funds including $6,078,288 to the General Fund, $1,152,712 to the Park Dedication Fund, $150,000 to Fiscal Year 2022/23 Measure M Surplus, and $825,000 to Fiscal Year 2023/24 Measure M Surplus
$500,000 from the Buchanan Park Restrooms Project (Project 1753) to the General Fund
$750,000 from the City Park Restrooms Project (Project 1754) to the General Fund $400,000 from the California Avenue Full Trash Capture Device Project to the General Fund
217
Resolution No. 24- Page 2 of 2 June 17, 2024 $750,000 from the Police Camera Servers Replacement Project (Project 3090) to the General Fund
BE IT FUTHER RESOLVED that the City Council of the City of Pittsburg hereby allocates:
$9,792,811 from ARPA Revenue Replacement (Fund 298) to create a Sports Tourism project
$1.25 million to Project 1754 for the City Park Restrooms Project $120,000 ARPA funds to Project 1803 for Pittsburg Eats! $750,000 ARPA funds to Project 3090 for replacement of the Police camera server $2,068,227 ARPA funds to Project for the Enterprise Resource Planning software replacement
BE IT FURTHER RESOLVED that the City Council of the City of Pittsburg hereby allocates $200,000 from Fiscal Year 2022/23 Measure M Surplus to establish a Measure M Reserve and $200,000 from Fiscal Year 2022/23 Measure M Surplus to establish a Youth Fund.
PASSED AND ADOPTED by the City Council of the City of Pittsburg at a regular meeting on the 17th day of June 2024, by the following vote:
AYES:
NOES:
ABSTAINED:
ABSENT:
_____________________________
Juan Antonio Banales, Mayor
ATTEST:
______________________________
Alice E. Evenson, City Clerk
218
1 Attachment 2
American Rescue Plan Act (ARPA) Current Status
Total ARPA Funding $16,290,477
Revenue Replacement (Max. $10MM; **Reported**) $10,000,000 Designated as RR, Reso. No. 23-14296 Projects $6,290,477 N/A
Total ARPA Funding $16,290,477
Revenue Replacement
Sports Tourism $9,250,000 Allocated, Reso. No. 23-14341 Police EV Chargers at City Hall $90,300 Allocated, Reso. No. 23-14272 Fleet Study $116,889 Allocated, Reso. No. 23-14229
Unassigned $542,811 Assignment before 12/31/24
Revenue Replacement Subtotal $ 10,000,000
Non-Revenue
Replacement
Frontage Road Trail $812,250
Hotel Grant (Courtyard) $599,000 Allocated, Reso No. 23-14315
Local Business Coaching ("Pittsburg
Eats!") $200,000 Allocated, Reso No. 23-14315
Reviving the Heart of Pittsburg Pride $388,000 Allocated, Reso No. 23-14313 Trash Capture Devices $400,000 Allocated, Reso. No 23-14318 Americana Park Bypass Channel $103,000 Allocated, Reso No. 24-14453 Non-Revenue Replacement Subtotal $2,502,250
ARPA Balance $3,788,227
219
2 American Rescue Plan Act (ARPA) Proposed Status
Total ARPA Funding $16,290,477
Revenue Replacement (Max. $10MM; **Reported**) $10,000,000 Designated as RR, Reso. No. 23-14296 Projects $6,290,477 N/A
Total ARPA Funding $16,290,477
Revenue Replacement
Sports Tourism $9,250,000 Allocated, Reso. No. 23-14341 Police EV Chargers at City Hall $90,300 Allocated, Reso. No. 23-14272 Fleet Study $116,889 Allocated, Reso. No. 23-14229
Unassigned $542,811 Assign before 12/31/24
Revenue Replacement Subtotal $10,000,000
Non-Revenue
Replacement
Frontage Road Trail $812,250
Hotel Grant (Courtyard) $599,000 Allocated, Reso No. 23-14315
Local Business Coaching ("Pittsburg
Eats!") $200,000 Allocated, Reso No. 23-14315
Additional Local Business Coaching ("Pittsburg Eats!") $120,000 Allocate to ARPA 6/17/24 Reviving the Heart of Pittsburg Pride $388,000 Allocated, Reso No. 23-14313 Trash Capture Devices $400,000 Allocated, Reso. No 23-14318 Americana Park Bypass Channel $103,000 Allocated, Reso No. 24-14453 City Park Restroom $1,250,000 Reallocate to ARPA 6/17/24 PD servers $750,000 Reallocate to ARPA 6/17/24
Enterprise Allocated, Resource Planning/Server $2,068,227 Reallocate to ARPA 6/17/24 Non-Revenue Replacement Subtotal $6,290,477
ARPA Balance $ -
220
3 General Fund Surplus Current
FY 2021-2022 FY 2022-2023 FY 2023-2024 FY 2024-2025 (Est) Starting Balance (Previous
Remaining Surplus) $7,851,300 $8,201,300 $5,389,113 $1,137,813 Revenues Applied
Use of FY 21/22 Surplus $1,183,000 $0 $0 $0
Use of FY 22/23 Surplus $0 $146,000 $0 $0
Use of FY 23/24 Surplus $0 $0 $0 $0
Use of FY 24/25 Surplus $0 $0 $0 $0
Subtotal $1,183,000 $146,000 $0 $0
Total $9,034,300 $8,347,300 $5,389,113 $1,137,813
EXPENDITURES
Expenditures Allocated FY 2021-2022 FY 2022-2023 FY 2023-2024 FY 2024-2025 (Pln) Pavement $0 $0 $1,251,300 $0
Skate Park $0 $435,187 $0 $0
Public Art $0 $200,000 $0 $0
Streetlight LED Replacement $0 $500,000 $0 $0
Heart of Pittsburg Pride Trees $0 $62,000 $0 $0
Police Activities League $0 $0 $0 $250,000
Buchanan Park RR $0 $0 $500,000 $0
City Park RR $0 $0 $750,000 $0
City Entrances $0 $0 $250,000 $0
Utility Box Art $0 $0 $0 $20,000
Premier Fields $0 $1,615,000 $0 $0
Landscape Master Plan $0 $0 $1,500,000 $0
Uncommitted $0 $0 $0 $0
Subtotal Expenditures
Allocated $0 $2,812,187 $4,251,300 $270,000
Additional Draws on General Fund Surplus
Kirker Pass Rd Resurfacing $233,000 $0 $0 $0
Park Patrol Contract $250,000 $0 $0 $0
Police Fencing $0 $0 $0 $0
Police Evidence Room $350,000 $0 $0 $0
Police Servers $0 $0 $0 $0
Park Safety Trees $0 $30,000 $0 $0
Library Hours $0 $116,000 $0 $0
Subtotal Additional Draws $833,000 $146,000 $0 $0
Total Expenditures $833,000 $2,958,187 $4,251,300 $270,000 Balance $8,201,300 $5,389,113 $1,137,813 $867,813
221
4 General Fund Surplus Proposed
FY 2021-2022 FY 2022-2023 FY 2023-2024 FY 2024-2025 (Est) Starting Balance (Previous
Remaining Surplus) $7,851,300 $8,201,300 $7,004,113 $4,002,813 Revenues Applied
Use of FY 21/22 Surplus $1,183,000 $0 $0 $0
Use of FY 22/23 Surplus $0 $146,000 $0 $0
Use of FY 23/24 Surplus $0 $0 $0 $0
Use of FY 24/25 Surplus $0 $0 $0 $0
Subtotal $1,183,000 $146,000 $0 $0
Total $9,034,300 $8,347,300 $7,004,113 $4,002,813
EXPENDITURES
Expenditures Allocated FY 2021-2022 FY 2022-2023 FY 2023-2024 FY 2024-2025 (Pln) Pavement $0 $0 $1,251,300 $0
Skate Park $0 $435,187 $0 $0
Public Art $0 $200,000 $0 $0
Streetlight LED Replacement $0 $500,000 $0 $0
Heart of Pittsburg Pride Trees $0 $62,000 $0 $0
Police Activities League $0 $0 $0 $250,000
Buchanan Park RR $0 $0 $500,000 $0
City Park RR $0 $0 $750,000 $0
City Entrances $0 $0 $250,000
Utility Box Art $0 $0 $0 $20,000
Premier Fields $0 $1,615,000 $0 $0
Landscape Master Plan $0 $0 $1,500,000 $0
Uncommitted $0 $0 $0 $0
Subtotal Expenditures
Allocated $0 $1,197,187 $3,001,300 $270,000
Additional Draws on General Fund Surplus
Kirker Pass Rd Resurfacing $233,000 $0 $0 $0
Park Patrol Contract $250,000 $0 $0 $0
Police Fencing $0 $0 $0 $0
Police Evidence Room $350,000 $0 $0 $0
Police Servers $0 $0 $0 $0
Park Safety Trees $0 $30,000 $0 $0
Library Hours $0 $116,000 $0 $0
Subtotal Additional Draws $833,000 $146,000 $0 $0
Total Expenditures $833,000 $1,343,187 $3,001,300 $270,000 Balance $8,201,300 $7,004,113 $4,002,813 $3,732,813
222
5 Measure M Surplus Current
Current Yr Future Yrs
Annual Measure M Revenue
2021-2022
Revenues
Available
in 2022-
2023
2022-2023
Revenues
Available
in 2023-
2024
2023-2024
Received,
Available in
2024-2025
2024-2025
Projected,
Available in
2025-2026
Budgeted Revenue $6,648,700 $6,446,244 $6,567,495 $6,340,000 Carryover from Previous Year
Surplus $0 $0 $258,774 $879,602
Subtotal Revenue $6,648,700 $6,446,244 $6,826,269 $7,219,602 Base Allocations
Economic Development Revenue
Base $450,000 $450,000 $450,000 $450,000
Police Revenue Base $2,850,000 $2,850,000 $2,850,000 $2,850,000 Public Works Revenue Base $750,000 $750,000 $750,000 $750,000 Recreation - Senior Center Revenue
Base $425,000 $425,000 $425,000 $425,000
Recreation - Youth Revenue Base $425,000 $425,000 $425,000 $425,000 Reserves $0 $0 $0 $0
Subtotal Revenue Base Allocations $4,900,000 $4,900,000 $4,900,000 $4,900,000 Measure M Annual Surplus $1,748,700 $1,546,244 $1,926,269 $2,319,602 Economic Dev: W Leland Traffic
Signal $850,000 $0 $0 $0
Economic Dev: 3rd Party Park
Patrol $0 $200,000 $0
Public Works: Sidewalk Repair $0 $170,803 $100,000 $0 Public Works: Skate Park Tree
Removal $63,700 $0 $0 $0
Public Works: Streetlight Data w
CCTA $85,000 $0 $0 $0
Public Works: BART Connectivity $0 $25,000 $0 $0 Public Works: Loveridge Road
Pavement $0 $25,000 $0 $0
Public Works: Pittsburg Premier
Fields
$150,000 $825,000 $0
Public Works: Security Cameras $0 $300,000 $0 $0 Recreation: - Marina Center $750,000 $0 $0 $0
Recreation: Library Hours $0 $121,667 $121,667 $121,667 Recreation: Small World Park Train
and Carousel $0 $295,000 $0 $0
Subtotal $1,748,700 $1,287,470 $1,046,667 $121,667 Balance $0 $258,774 $879,602 $2,197,935
223
6 Measure M Surplus Proposed
Current Yr Future Yrs
Annual Measure M Revenue
2021-2022
Revenues
Available
in 2022-
2023
2022-2023
Revenues
Available
in 2023-
2024
2023-2024
Received,
Available in
2024-2025
2024-2025
Projected,
Available in
2025-2026
Budgeted Revenue $6,648,700 $6,446,244 $6,567,495 $6,340,000 Carryover from Previous Year
Surplus $0 $0 $8,774 $1,454,602
Subtotal Revenue $6,648,700 $6,446,244 $6,576,269 $7,794,602 Base Allocations
Economic Development Revenue
Base $450,000 $450,000 $450,000 $450,000
Police Revenue Base $2,850,000 $2,850,000 $2,850,000 $2,850,000 Public Works Revenue Base $750,000 $750,000 $750,000 $750,000 Recreation - Senior Center Revenue
Base $425,000 $425,000 $425,000 $425,000
Recreation - Youth Revenue Base $425,000 $425,000 $425,000 $425,000 Reserves $0 $200,000 $0 $0
Subtotal Revenue Base Allocations $4,900,000 $5,100,000 $4,900,000 $4,900,000 Measure M Annual Surplus $1,748,700 $1,346,244 $1,676,269 $2,894,602 Economic Dev: W Leland Traffic
Signal $850,000 $0 $0 $0
Economic Dev: 3rd Party Park
Patrol $0 $200,000 $0
Public Works: Sidewalk Repair $0 $170,803 $100,000 $0 Public Works: Skate Park Tree
Removal $63,700 $0 $0 $0
Public Works: Streetlight Data w
CCTA $85,000 $0 $0 $0
Public Works: BART Connectivity $0 $25,000 $0 $0 Public Works: Loveridge Road
Pavement $0 $25,000 $0 $0
Public Works: Pittsburg Premier
Fields
$150,000 $825,000 $0
Public Works: Security Cameras $0 $300,000 $0 $0 Recreation: - Marina Center $750,000 $0 $0 $0
Recreation: Library Hours $0 $121,667 $121,667 $121,667 Recreation: Project 1751 - Youth
Fund $0 $200,000 $0 $0
Recreation: Small World Park Train
and Carousel $0 $295,000 $0 $0
Subtotal $1,748,700 $1,487,470 $1,046,667 $121,667 Balance $0 $8,774 $1,454,602 $2,772,935
224