Fullerton City Hall - 303 West Commonwealth Avenue
Third Floor - Room 301
Administrative Services Department Conference Room
In the absence of Chairman Greenwood, Victoria Beatley served as Acting Chair and called the meeting to order at 4:05 p.m.
|Members present:|| Victoria Beatley, Citizen Member|
Steven Foeller, Citizen Member
Chris Meyer, Director of Administrative Services
Phyllis Garrova, City Treasurer
Note: City Manager joined the meeting at 4:42 p.m.
|Members absent:||F. Richard Jones, M.D., Mayor|
John Greenwood, Chairman, Citizen Member
New City Treasurer Phyllis Garrova introduced herself and briefed the Committee members on her experience as a city treasurer and portfolio manager.
Chris Meyer informed the Committee that Chairman John Greenwood had submitted his resignation to the City on November 16th, effective immediately. Mr. Meyer motioned that Victoria Beatley assume the role of Chairman, and Steve Foeller assume the role of Vice-Chairperson. Ms. Beatley asked for a motion to close nominations and approve the nominees. Mr. Meyer motioned. Ms. Garrova seconded.
|AYES:||Beatley, Foeller, Garrova, Meyer|
Mr. Meyer noted that only three Committee members were present who attended the June 8, 2000, meeting, and moved that the minutes be approved. Mr. Foeller seconded.
|AYES:||Beatley, Foeller, Meyer|
Ms. Garrova distributed to the Committee members an updated status report of the investment portfolio as of October 31. She pointed out the significant increase in the LAIF balance between June and September, and explained that the City had been placing all investment monies into LAIF (between June and September) until a new City Treasurer was appointed by City Council.
Ms. Garrova noted that since assuming the role of City Treasurer on October 11, she had been reinvesting in the $2-$3 million area in a variety of instruments. She provided the committee with a detailed list of investments for the month of October 2000, and indicated that she would be looking into Fannie Maes (Federal National Mortgage Association) and Freddie Macs (Federal Home Loan Mortgage Corporation) for diversification.
Ms. Garrova referred the Committee members to page 4, Section 9, "Investment Maturity," of the City's Investment Policy, noting that it restricts investment of monies (not needed to cover immediate operating costs) to a three-year maturity, and no more than an average of 720 days for the total portfolio. She advised that it had been the City's practice to invest in one to two-year maturities. Ms. Garrova recommended that the Committee consider revising the policy to extend investments to the Government Code's maximum of five years to allow the City to take advantage of longer-term investment opportunities. It was the consensus of the Committee members that the recommended revision to the Investment Policy be considered during the next review of the Investment Policy scheduled for early 2001, and that any changes to the policy be submitted to Council at its annual review and adoption in July 2001. In the interim, the Committee directed the City Treasurer to invest in longer-term maturities, as permitted by the existing policy, at her discretion.
City Treasurer Garrova submitted to the Committee members a list of local banks and savings and loans, along with their current rates, that the Committee might consider for purchases of Certificates of Deposit (CDs) not exceeding $99,000 (noting that this would be protected by the FDIC's $100,000 insurance limit). Ms. Garrova pointed out that investing locally would 1) support the community, 2) provide diversification, and 3) offer competitive rates.
Mr. Meyer noted that the Investment Policy allows investing locally providing the rates are competitive with LAIF, six-month U.S. Treasury Bills, or the average Federal Funds rate.
Ms. Garrova indicated that in checking with the local institutions, First Bank had expressed they were very interested in the City's business and would offer an additional half percent on top of their rates for a one-year or 18-month CD. Among the other local banks and savings and loans listed, the rates were competitive for a 12-month CD, namely, Bank of Orange County, Citizens Bank, Downey Savings & Loan (but requires the City to open a checking account), World Savings & Loan, and Quaker City Federal Savings & Loan.
Chairman Beatley asked if the local credit union was an option. Mr. Meyer pointed out that it would not be appropriate to deal with the credit union for the City's investments because of the potential conflict of interest due to the fact that the credit union was founded by the City and many credit union board members are City employees.
Ms. Garrova pointed out that the Investment Policy allows purchases of this category in an amount not to exceed 15% of the portfolio, and suggested that she pursue investing locally within that guideline. It was the consensus of the Committee that she do so.
Chairman Beatley asked about the rating of the local institutions. City Treasurer Garrova said she would look into that.
The following Thursday meeting dates were approved for 2001: February 15, May 31, August 23, and November 29. All meetings will continue to be held at 4:00 p.m. in the Administrative Services Department third-floor conference room.
With no further business, Mr. Meyer motioned to adjourn the meeting. Mr. Foeller seconded. Motion was unanimously approved.
Meeting adjourned at 4:47 p.m.