Title
Update of the Investment Policy Statements for the City of San Leandro's Section 115 Pension and OPEB Trusts
Staffreport
SUMMARY
The City Council annually reviews and confirms the San Leandro Investment Policy, however, Pension and OPEB Trust assets are held separately from general City investments and certain laws limiting investments do not apply to these assets. As such, separate policies are needed for these assets.
RECOMMENDATIONS
Staff recommends the City Council Finance Committee review and recommend the Investment Policy Statements for the Section 115 Pension and Other Post-Employment Benefits (OPEB) Trusts.
BACKGROUND
The City maintains Section 115 Trusts to assist in funding of both OPEB and pension obligations. These trusts are removed from other City assets and are not governed by California Government Code Sections 53600 et. seq. as other City investments are. While the intent of investments in these trusts is still stable growth, the two main differences between the trust assets and general City assets are that the trusts can invest in certain equities (stock), and the trust investments may maintain a longer time to maturity than other City assets.
The current Investment Guidelines Document for the City's Employee Benefit Fund Pension Plan was approved by Council in May 2021 when the City established a 115 Pension trust with PARS (Public Agency Retirement Services). Investment Guidelines for the City's Post-Retirement Healthcare Plan were approved in July 2021. Since approval, the trust's investment manager has transitioned from Highmark to PFMAM. PFMAM has requested Council review of the funding policies and updates to a new Investment Policy template.
While the format and wording is changing in the proposed policy statements, the intent and risk tolerance of both portfolios is staying the same.
Current Agency Policies
* Investment Guidelines Document: City of San Leandro Employee Benefit Fund Pension Plan (May 2021)
* Inves...
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