01-23-17 Board of Finance - Laserfiche WebLink

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Councilmember Gavin Ferlic made a motion to approve the City Investment Officers. Councilmember John Voorde seconded the motion which carried by a voice vote of eight(8) ayes. Mr. Murphy read the names of the Investment Advisors from 1" Source Bank: Paul Gifford, Erik Clapsaddle. Councilmember Randy Kelly made a motion to approve the Investment Advisors from lst Source Bank. Councilmember Gavin Ferlic seconded the motion which carried by a voice vote of eight (8) ayes. Mr. Murphy stated, We have currently authorized $175,000,000 in the investment account. We would like to increase that to $185,000,000. We are not going to be short on the ability to pay bills or anything like that. Paul will be able to explain a little bit of what he will be able to do as far interest earnings with that additional $10,000,000. Mr. Murphy informed the Council of quarterly Investment Review meetings, scheduled for April, July, October, and January, following completion of the quarter. He stated that Council and Board of Finance members are welcome to attend. He explained that the meetings are held at 1St Source Bank, where those in attendance are walked through different investment options. Paul Gifford, 1St Source Bank, 100 North Michigan Street, South Bend, IN, continued the presentation. Mr. Gifford asked the Council to turn to Page Three (3) in their packet, stating, This is the investment policy for the City of South Bend. There is only one (1) change that we would like to discuss with you tonight. Four (4) years ago,the State of Indiana approved you to be able to purchase treasury bonds between two (2) and five (5) years. That expires every four (4)years. On January 31St, 2017 it expires. Councilmember Gavin Ferlic made a motion to approve a four(4) year extension of the investment policy for the City of South Bend. Councilmember Dr. David Varner seconded the motion which carried by a voice vote of eight(8) ayes. Mr. Gifford asked the Council to turn to Page Six(6),the investment portfolio for the City of South Bend, which is a$175,000,000 investment portfolio. Mr. Gifford stated that it is all invested in treasuries, agencies, and CD's,which are all in course with the investment policy. He stated, For the year 2016, on Page Thirteen(13),the portfolio returned one percent (1%), which—versus the investments that you had previously, which was a half a percent (.5%) increase—ends up being about$875,000 in additional earnings. In the upper right hand corner of Page Thirteen(13) is the cumulative returns since you opened the investment account with us in 2011. As you can see by the graph,there is over a two-and-a-half percent(2.5%) difference between where you had been versus the program with us. Obviously, in this size portfolio, that literally means millions of dollars more for the City of South Bend. So, as part of that, we have had conversations with John and his team about increasing that portfolio by $10,000,000 so that we can continue to earn more money for the City of South Bend. 2