HomeMy WebLinkAbout2025-02-20; Investment Review Committee; 03; Investment Review Committee UpdateMeeting Date: Feb. 20, 2025
To: Investment Review Committee
From: Christian Peacox, City Treasurer
Staff Contact: Katie Schroeder, Senior Accountant
katie.schroeder@carlsbadca.gov, 442-339-5246
Subject: Investment Review Committee Update
District: All
Recommended Action
Receive a report on the composition and duties of the Investment Review Committee, including
options and alternatives for restructuring the committee, and provide feedback.
Executive Summary
Section 10.0 of the city’s Investment Policy establishes the Investment Review
Committee, which is comprised of five voting members: the City Treasurer, City Manager, City
Attorney, Deputy City Manager of Administrative Services and Finance Director, or their
respective designees. The City Treasurer may also appoint non-voting resident advisors to the
Committee.
To increase transparency and better comply with the Brown Act, the Investment Review
Committee has been conducted in a public forum beginning with its special meeting held on
Oct. 24, 2024. In addition, the City Treasurer and staff will be seeking the City Council’s
direction to potentially restructure the committee. Upon receiving direction, staff will present a
resolution amending Section 10.0 of the city’s Investment Policy and an ordinance amending
the Carlsbad Municipal Code to include the committee to reflect the City Council’s direction.
Explanation
The City Council established the city’s Investment Policy on Jan. 2, 1985. Amendments to the
policy have also been adopted by the City Council to provide proper guidance to the elected
City Treasurer and city staff, improve the city’s ability to manage city funds and maintain
compliance with the California Government Code requirements for investing surplus funds.
Notably, the City Council’s adoption of the amended Investment Policy on Sept. 10, 1985,
included the initial establishment of the city’s Investment Review Committee. The Investment
Review Committee was tasked with “conduct[ing] periodic reviews of the City’s investment
portfolio, the strategy being utilized for the investment of City funds, and the City’s investment
INVESTMENT REVIEW COMMITTEE
Feb. 20, 2025 Item #3 Page 1 of 3
Staff Report
policy.”
Since the committee’s inception, and throughout numerous City Council-approved
amendments, members have included the City Manager, City Attorney, Deputy City Manager of
Administrative Services, Finance Director and the City Treasurer, or their respective designees.
On Feb. 13, 2007, the City Council-approved Investment Policy included a change that granted
the City Treasurer authority to appoint resident advisors to the committee.
The Investment Review Committee is currently structured with five voting members: the City
Treasurer, Intergovernmental Affairs Director (as the City Manager’s designee), Assistant City
Attorney (as the City Attorney’s designee), Deputy City Manager of Administrative Services and
Finance Director. The committee also currently has three active non-voting resident advisors.
Across the region, only two cities have committees dedicated to investment review:
• The City of Vista’s Investment Advisory Committee meets twice per year and members
consist of the city manager, city attorney and three residents appointed by the city
council.
• The City of Oceanside’s Citizen Investment Oversight Committee meets quarterly with at
least five city treasurer-nominated and city council-approved resident members.
To improve the city’s ability to manage city funds and enhance the level of transparency and
oversight over the city’s investment activities and allow city staff to better serve the Investment
Review Committee while complying with the Brown Act, staff are recommending removing city
staff from
the committee. Staff are seeking feedback from the committee as to the
appointment of committee members, duties, qualifications and the committee naming
convention, including feedback on the options and alternatives below.
Options
Option 1: Appointment, duties, qualifications and naming of the Committee:
Appointment: Staff seek guidance as to the five-member Committee appointment process.
• Alternative 1: The Mayor appoints all members of the Committee.
• Alternative 2: The Mayor and City Council each appoints a member of the Committee.
• Alternative 3: The City Treasurer nominates and City Council approves the members of
the Committee.
Duties: Staff seek guidance as to the duties attributed to the Committee.
• The committee shall conduct reviews of the city’s investment portfolio and the strategy
being utilized for the investment of city funds to ensure compliance with the city’s
Investment Policy.
• The committee shall review the city’s Investment Policy and make recommendations to
the City Treasurer as needed at least once a year.
• The committee shall act in an advisory capacity and shall not make investment
decisions.
• Committee members shall meet periodically as necessary or desirable, but not less
frequently than once each quarter.
Feb. 20, 2025 Item #3 Page 2 of 3
Special Qualifications: Staff seek guidance as to whether minimum qualifications shall be
applied to Investment Review Committee members.
• Alternative 1: The member must have a bachelor’s, master’s or doctorial degree
majoring in business administration, public administration, accounting, finance or
economics. The person must have four years of financial work experience. In lieu of the
work experience required, the person may have one of the following:
o A valid certificate from the California State Board of Accountancy to practice
as a Certified Public Accountant;
o A valid Chartered Financial Analyst credential or a Certificate in Investment
Performance Management from the CFA Institute;
o A valid Certified Investment Management Analyst certification from the
Investments & Wealth Institute; or
o A valid Certified California Municipal Treasurer designated from the
California Municipal Treasurers Association.
Alternative 2: No special qualifications.
Naming Convention: Given that the committee will comply with the Brown Act
requirements, staff recommends amending Title 2 of the Carlsbad Municipal Code to
include the committee and seeks guidance as to the naming convention.
• Alternative 1: Keep the name as the Investment Review Committee.
• Alternative 2: Change the name to the Investment Review Advisory Board.
Option 2: Provide alternative feedback as desired.
Fiscal Analysis
Supporting the committee in compliance with the Brown Act will involve staff time that will be
absorbed within the existing workload of the Administrative Services Branch. The
estimated annual cost of $4,000 for technical support, videography and archiving the meeting
videos will be requested as part of the fiscal year 2025-26 preliminary operating budget.
Next Steps
The City Treasurer and staff will return to the City Council with options for restructuring the
committee including input from the Investment Review Committee. Based on City Council
direction, staff will bring forward a resolution updating Section 10.0 of the Investment Policy to
formalize the new structure of the committee, and an ordinance amending Title 2 of the
Carlsbad Municipal Code to incorporate the committee into the municipal code.
Environmental Evaluation
This action does not require environmental review because it does not constitute a project
within the meaning of the California Environmental Quality Act under California Public
Resources Code Section 21065 in that it has no potential to cause either a direct physical
change or a reasonably foreseeable indirect physical change in the environment.
Exhibits
None.
Feb. 20, 2025 Item #3 Page 3 of 3
Investment Review
Committee Update
Christian Peacox, City Treasurer
February 20, 2025
( City of
Carlsbad
COMMITTEE HISTORY
Item 3: IRC Update
•City Council established Investment Policy on 1/2/1985
•Investment Review Committee established 9/10/1985
•Investment Policy amended to include City Treasurer-appointed
resident advisors on 2/13/2007
{city of
Carlsbad
COMMITTEE STRUCTURE
•Comprised of City Treasurer, City Manager, City Attorney, Deputy
City Manager of Administrative Services, and Finance Director, or
their respective designees
•City Treasurer may appoint non-voting resident advisors to the
Committee
Item 3: IRC Update
COMMITTEE STRUCTURE
To improve the city’s ability to manage city funds and enhance the
level of transparency and oversight over the city’s investment
activities and allow city staff to better serve the Investment Review
Committee while complying with the Brown Act, staff are
recommending removing city staff from the committee. Staff are
seeking feedback from the committee as to the appointment of
committee members, duties, qualifications and the committee
naming convention, including feedback on the options and
alternatives below.
Item 3: IRC Update
APPOINTMENT, DUTIES, QUALIFICATIONS,
AND NAMING CONVENTION
•The Mayor appoints all members of the Committee
•The Mayor and City Council members each appoints a member of
the Committee
•The City Treasurer nominates and the City Council approves the
members of the committee
Item 3: IRC Update
{city of
Carlsbad
DUTIES
• The committee shall conduct reviews of the city’s investment
portfolio and the strategy being utilized for the investment of city
funds to ensure compliance with the city’s Investment Policy.
• The committee shall review the city’s Investment Policy and make
recommendations to the City Treasurer as needed at least once a
year.
• The committee shall act in an advisory capacity and shall not
make investment decisions.
• Committee members shall meet periodically as necessary or
desirable, but not less frequently than once each quarter.
Item 3: IRC Update
{city of
Carlsbad
SPECIAL QUALIFICATIONS
The member must have a bachelor’s, master’s or doctorial degree
majoring in business administration, public administration,
accounting, finance or economics. The person must have four years
of financial work experience. In lieu of the work experience required,
the person may have one of the following:
o A valid certificate from the California State Board of Accountancy
to practice as a Certified Public Accountant;
o A valid Chartered Financial Analyst credential or a Certificate in
Investment Performance Management from the CFA Institute;
o A valid Certified Investment Management Analyst certification
from the Investments & Wealth Institute; or
o A valid Certified California Municipal Treasurer designated from
the California Municipal Treasurers Association.
Item 3: IRC Update
NAMING CONVENTION
Given that the committee will comply with the Brown Act
requirements, staff recommends amending Title 2 of the Carlsbad
Municipal Code to include the committee and seeks guidance as to
the naming convention.
• Alternative 1: Keep the name as the Investment Review
Committee.
• Alternative 2: Change the name to the Investment Review
Advisory Board.
Item 3: IRC Update
NEXT STEPS
The City Treasurer and staff will return to the City Council with options for
restructuring the committee including input from the Investment Review
Committee. Based on City Council direction, staff will bring forward a
resolution updating Section 10.0 of the Investment Policy to formalize the
new structure of the committee, and an ordinance amending Title 2 of the
Carlsbad Municipal Code to incorporate the committee into the municipal
code.
Item 3: IRC Update
{city of
Carlsbad