Laserfiche WebLink
<br /> <br />tervi{{e <br />'Estab{isfiea 1857 <br /> <br />STAFF REPORT <br />CENTERVlLLE CITY COUNCIL <br /> <br />Date: <br /> <br />June 23, 2004 <br /> <br />To: <br /> <br />Honorable Mayor and City Council Members <br />Ms. Kim Moore-Sykes, City AdminiRtrator <br /> <br />From: <br /> <br />Ellen PauJsetb, Finance Director ~ <br />Revise Investment Policy <br /> <br />Re: <br /> <br />************************************************************************ <br /> <br />The City's current investment policy authorizes the Finance Director to invest up to 20% <br />of the total portfolio in investments that extend beyond 5 years, but in no circumstance <br />beyond 8 years. Recently, the City Administrator and I met with investment advisors <br />from Smith Bamey who recommended extending the term to 10 years. It may also be <br />advantageous to increase the amount of the portfolio that is allowed to be invested in <br />longer term instruments. <br /> <br />Greater opportunities and higher yields exist for 10-year maturities that are not available <br />with an 8-year maturity. By monitoring the investment ladder and analyzing working <br />capita! needs on a continual basis, we can increase our overall rate of return without <br />jeopardizing the City's need for liquidity. <br /> <br />I have been informally polling Finance Directors from other cities and I am finding that <br />the 10-year limitation is quite standard. The 8-year limit seems to be the exception rather <br />than the rule. <br /> <br />In addition, we fmd that we are frequently pushing the limit of the 20% maximum <br />allowed for longer-term investments. With large amounts of bond proceeds and special <br />assessment payments coming in, we could maximize yield by allowing a modest increase <br />in the amount investments with maturities extending beyond five years. We recommend <br />increasing the amount to 25%. <br /> <br />A resolution is attached for your consideration. <br /> <br />L~___ _. <br />