HomeMy WebLinkAbout07 CITY TREASURER APPOINTMENT• Agenda Item 7
AGENDA REPORT Reviewed:
City Manager
Finance Director AK
MEETING DATE: NOVEMBER 19. 2013
TO: HONORABLE MAYOR AND MEMBERS OF CITY COUNCIL
FROM: JEFFREY C. PARKER, CITY MANAGER
SUBJECT: RECOMMENDATION OF THE FINANCE DIRECTOR'S APPOINTMENT
AS THE CITY TREASURER
SUMMARY:
City Council is asked to consider the recommendation to appoint the Finance Director
as the City Treasurer.
RECOMMENDATION:
It is recommended that the City Council accept the City Manager's recommendation to
appoint the Finance Director as the City Treasurer, who shall be responsible for
investing City funds in accordance with the City's Investment Policy that is adopted by
the City Council annually, and increase the Finance Director's annual salary by 5% from
$165,651 to $173,933.
FISCAL IMPACT:
Appointing the Finance Director as the City Treasurer would yield a net savings in
expenditures to both the General Fund and Water Enterprise Fund of $19,858.
CORRELATION TO THE STRATEGIC PLAN:
The recommendation correlates to the City's strategic plan for fiscal stewardship for
practicing sound stewardship of the public's assets, Goal C.
BACKGROUND:
At the October 1, 2013, City Council meeting, the City Manager recommended the
Finance Director be appointed as the City Treasurer. The City Manager's
recommendation that the Finance Director be appointed the City Treasurer included a
third party review of the City's Investments by the Audit Commission at their bi- monthly
meetings.
The City Council requested two modifications to the proposal:
(1) That the Audit Commission be more directly involved in the investment
process.
(2) That information be provided on how other cities operate regarding the use of
an Audit Committee /Commission.
RECOMMENDATION OF THE FINANCE DIRECTOR'S APPOINTMENT AS THE CITY TREASURER
NOVEMBER 19, 2013 PAGE 2
After providing the Audit Commission with additional legal information, the Commission
recommended that a two- member sub - committee would meet on a monthly basis with
the Finance Director to review the City's investments and the strategy for investing the
City's cash. The Commission also agreed to provide a signature on the quarterly
investment reports. The investment reports would then be submitted on a quarterly
basis to the City Council for their approval.
The Council also requested staff check with other cities where the Finance Director
serves as the City Treasurer to verify if those cities have a third party such as the Audit
Commission that reviews the City's investments. Several Orange County cities were
contacted. Of the cities that responded, the cities that have an Investment Advisory
Committee that meet on a quarterly basis are Irvine, Mission Viejo and Laguna Niguel.
The City of Lake Forest has an Investment Oversight Reviewer that performs an "audit"
in the form of an Agreed Upon Procedure each quarter and an annual certification that
the City's Investment Policy is in compliance with State Law. The following cities do not
have a committee /commission /third party review of the City's investments: La Habra,
Yorba Linda, Laguna Niguel, Seal Beach, Santa Ana, Laguna Hills, and Aliso Viejo.
The City of Newport Beach posts a monthly Treasurer's report on their website and
devotes one annual meeting with the City's Finance Committee to review performance
and recommended changes in investment strategy.
Establishing the Finance Director as the City Treasurer along with the review and
signature approval of the audit commission provides the City with four separate
evaluations of our investment policy on an on -going basis.
Should the City Council accept the City Manager's recommendation, the resolution
authorizing the Finance Director /City Treasurer's salary increase and the approval of
the Finance Director /City Treasurer position will be presented to the City Council at the
December 3, 2013, City Council meeting.
J . Parker
ty r ager