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Page 1 of 2 <br />Item #7 <br /> CITY COUNCIL AGENDA REPORT <br /> <br />June 16, 2026 <br />Finance <br /> <br />TITLE: ADOPT A RESOLUTION APPROVING FISCAL YEAR 2026/27 INVESTMENT <br />POLICY AND GUIDELINES <br /> <br />SUMMARY <br />Pursuant to California Government Code Section 53646(a)(2), the City’s Investment Policy and <br />Guidelines may be submitted to the City Council annually for adoption. Various sections of the <br />Investment Policy and Guidelines were updated in the prior fiscal years, making the policy <br />more comprehensive and reflecting the requirements in the California Government Code. This <br />year’s updates reflect changes to the California Code resulting from the passage of SB 59. <br />This report satisfies the legal requirement that the City Council adopt an annual investment <br />policy. <br /> <br />RECOMMENDATION <br />Adopt the attached resolution approving the Investment Policy and Guidelines for FY 2026/27. <br /> <br />BACKGROUND <br />California Government Code Section 53646 provides for the City Council to adopt an annual <br />investment policy. The proposed Investment Policy and Guidelines for FY 2026/27 and the <br />adopting resolution are attached. <br /> <br />In addition to being legally required, an investment policy provides the framework for a prudent <br />investment program and helps fulfill the City’s fiduciary responsibilities. The formal investment <br />policy is necessary to identify investment objectives, define risk tolerance, assign <br />responsibility, and establish control over the investment process. <br /> <br />DISCUSSION <br />Safekeeping for cash and investments is one of the most important responsibilities of the City. <br />The investment policy directs investment activities and protects the government from potential <br />losses stemming from unsuitable investment practices. <br /> <br />Staff proposes modifying the policy language in various paragraphs. The changes include: <br />• Updating the maximum maturity for Commercial Paper investments from 270 days to <br />397 days consistent with Senate Bill 595—page 7. <br />• Exception to prohibited investments allowing U.S. Government securities with zero <br />accrual if held to maturity, extended to 2031 consistent with provisions of Senate Bill <br />595—page 10. <br /> <br /> <br />EQUITY AND SUSTAINABILITY <br />Page 113 of 443