REPORT TO COUNCIL
SUBJECT
Title
Adopt the City's Investment Policy for Fiscal Year 2015/16 and Receive the Annual Performance Report for Fiscal Year 2014/15
Report
BACKGROUND
The City Council first adopted a policy governing the investment of City funds on July 30, 1985. This policy has been reviewed and adopted on an annual basis since that time.
EXISTING POLICY
Council Policy 7.1.2 Investment and Cash Management requires that the Investment Policy be reviewed and adopted annually within 120 days of the fiscal year to ensure consistency with the overall objectives of safety, liquidity, and yield and its relevance to current law and financial and economic trends. A summary annual performance report on portfolio performance for the preceding fiscal year is also presented to the City Council as part of the annual investment policy review.
ENVIRONMENTAL REVIEW
N/A
DISCUSSION
Staff invests funds not immediately needed for disbursement. Funds for the City's Deferred Compensation Plan, the City's Retirement Plan, Other Post-Employment Benefits (OPEB) Trust, and debt issuance proceeds are not invested by City staff and therefore are not included in the investment portfolio. Funds needed for disbursement are maintained in a liquid checking account.
Annual Performance Report for FY 2014/15
The following annual report on portfolio performance for FY 2014/15 includes the key provisions of the policy and comparisons of the City's performance compared to the investment policy objectives.
The key provisions of the existing policy are as follows:
1. Safety of principal is the foremost objective of the investment program. The City's portfolio is diversified by type of investment, issuer, and maturity date. Diversification is required in order that potential losses on individual securities do not exceed the income generated from the remainder of the portfolio. The investment policy specifies the percentage of funds that can be invested in each ...
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