SB 564 repealed and rewrote California Government Code Section 53646 mandating cities and other local agencies to adopt a written investment policy. Further, this policy and any changes shall be considered at least annually by the Council at a public meeting. In addition it calls for quarterly reports concerning the City s financial holdings, a statement of compliance with the policy and a statement concerning the City s ability to meet its cash flow needs in the ensuing six months. This legislation has a wider impact on State and County levels than on cities including policy compliance audits and establishment of Investment Advisory Committees. Staff recommends no change to the policy.
Interest is earned from day of deposit to day of withdrawal and is paid quarterly.
There are about 2,000 State and local agency depositors in the fund. The proposed investment policy will allow the continuation of this practice. This provision will minimize staff time in preparing this quarterly information. All quarterly reports required by law have been made in a timely manner and the investment policy includes the prudent investor standard also required by law. These funds are accounted for in the Comprehensive Annual Financial Report.