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Item 4N Resolution 16-046, Annual Review of Investment policy and Investment Strategies Item 4N 1 City of Southlake Strategy Map The City of Southlake provides municipal services that support the highest quality of life for our residents, businesses, and visitors. We do this by being an exemplary model of balancing efficiency, fiscal responsibility, transparency, and sustainability. C1 Achieve the highest standards of safety & security C2 Provide travel convenience within City & region C3 Provide attractive & unique spaces for enjoyment of personal interests C4 Attract & keep top-tier businesses to drive a dynamic & sustainable economic environment C5 Promote opportunities for partnerships & volunteer involvement Serve our Customers Manage the Business B1 Achieve best-in-class status in all City disciplines B2 Collaborate with select partners to implement service solutions B3 Enhance resident quality of life & business vitality through tourism B4 Provide high quality services through sustainable business practices B5 Enhance service delivery through continual process improvement B6 Optimize use of technology Provide Financial Stewardship Promote Learning and Growth F1 Adhere to financial management principles & budget F2 Invest to provide & maintain high quality public assets F3 Achieve fiscal wellness standards F4 Establish & maintain effective internal controls L1 Ensure our people understand the strategy & how they contribute to it L2 Enhance leadership capabilities to deliver results L3 Attract, develop & retain a skilled workforce L4 Recognize & reward high performers L5 Empower informed decision-making at all levels in the organization C6 Enhance the sense of community by providing excellent customer service and citizen engagement opportunities L6 Foster positive employee engagement Deliver on Our Focus Areas The investment policy and strategies links to the City’s strategy map relative to the focus area of Performance Management and Service Delivery and specifically to the corporate business objectives of F1-Adhere to financial management principles and budget as well as F3-achieve fiscal wellness standards 2 Propose of Review Public Funds Investment Act Section 2256 Requires the governing body to review its policy and strategies annually (last review September 2015) Section 2256 – Public Funds Investment Act (“Act”) of the Texas Government Code establishes the requirements for a local government investment policy. 3 Resolution 16-046 Policy reviewed against the Public Funds Investment Act No recommended changes Both city staff and our financial advisor’s reviewed the policy for compliance and no required changes were identified 4 Investment Strategy Operating funds First objective: match cash flows with adequate liquidity Second objective: minimal volatility during economic cycles Now I would like to take a few moments to talk about the city’s investment strategy First objective is to assure that anticipated cash flows are matched with adequate investment liquidity. Second objective is to create a portfolio structure which will experience minimal volatility during economic cycles. This may be accomplished by purchasing high quality, short to medium term securities which will complement each other. A dollar weighted average maturity of 365 days or less will be calculated using the stated final maturity date of each security. 5 Investment Strategy Debt Service funds Primary objective: to ensure adequate investment liquidity Primary objective: to ensure adequate investment liquidity to cover the debt service obligation on the required payment date. Securities purchased shall not have a stated maturity date which exceeds the debt service payment date. 6 Investment Strategy Special projects, special purpose, or construction fund Primary objective: match cash flows with adequate liquidity. Primary objective: to ensure anticipated cash flows are matched with adequate investment liquidity. These portfolios should include at least 10% in highly liquid securities to allow for flexibility and unanticipated project outlays. The stated final maturity dates of securities held should not exceed the estimated project completion date. 7 Investment Authority Investment Officer(s) of the City: Chief Financial Officer Deputy Director City staff involved in the investment process shall refrain from personal business activity. The Chief Financial Officer and Deputy Director- are designated as Investment Officer(s) of the City and are responsible for investment decisions and activities. City staff involved in the investment process shall refrain from personal business activity that could conflict with proper execution of the investment program, which could impair the ability to make impartial investment decisions 8 Investment Objectives Safety Liquidity Yield Public Trust The City of Southlake shall manage and invest its cash with four objectives, listed in order of priority: Safety, Liquidity, Yield, and Public Trust. The safety of the principal invested always remains the primary objective. All investments shall be designed and managed in a manner responsive to the public trust and consistent with State and Local law. 9 Questions? Sharen Jackson 817-748-8042 10