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HomeMy WebLinkAboutRFP Details - Investment Advisory Services Request for Proposal Non-Discretionary Investment Advisory Services Issue Date: June 12, 2025 VENDOR QUESTIONS DUE: July 2, 2025 Question Submittal to: finance@rentonwa.gov PROPOSAL DUE: July 18, 2025 - 4:00 p.m. PT Email Proposals to Submittal to: finance@rentonwa.gov Electronic responses must be received by the city no later than the date, time, and location indicated above as the proposal due date. Late submission of responses shall be not considered. Submittal of response by fax is not acceptable. Note: This RFP does not constitute an order for the goods or services specified. City of Renton, WA – RFP for Investment Advisory Services 2 | Page T ABLE OF CONTENTS 1. INVITATION FOR PROPOSALS ................................................................................................ 3 2. BACKGROUND ........................................................................................................................... 4 3. SCOPE OF WORK , MIN. QUALIFICATIONS AND TIMELINE ........................................... 5 4. RFP EVALUATION .................................................................................................................... 7 5. VENDOR INSTRUCTIONS ........................................................................................................ 8 6. TERMS AND CONDITIONS ..................................................................................................... 12 EXHIBITS A – REFERENCES ...................................................................................................................... 15 B – INVESTMENT POLICY ....................................................................................................... 16 C – Q1 2025 CITY’S INVESTMENT PORTFOLIO ................................................................. 17 D – CITY OF RENTON PROFESSIONAL SERVICES AGREEMENT .................................. 18 City of Renton, WA – RFP for Investment Advisory Services 3 | Page SECTION 1 - INVITATION FOR PROPOSALS The City of Renton (city) is requesting proposals from experienced and qualified vendors that can provide non-discretionary investment advisory services that satisfies all the city’s requirements contained within this Request for Proposals (RFP). Preferred vendors shall have experience in the proposed solutions for cities of similar size and scope of services. A detailed description of the products and services required are contained in Section 3 - Scope of Work and Timeline of this RFP. Vendors can submit a proposal by email to: finance@rentonwa.gov It is the vendor’s responsibility to deliver proposals to the city by the date and time indicated in this RFP. The city accepts no responsibility for lost or misdirected email submittals. The city is not liable for any costs incurred by the vendor before issuance of a contract. All costs incurred in responding to this RFP are solely the responsibility of the vendor. All materials submitted in response to this RFP become the property of the city and as such public documents and will not be returned. Submission of a proposal shall constitute acknowledgment and acceptance of all terms and conditions contained and exhibits in this RFP. This is a competitive negotiation process in accordance with RCW 39.04.270. The city will consider all the evaluation information obtained during the competitive negotiation process. The city reserves the right to reject any and all proposals in part or in full for any reason. The city also reserves the right to change, cancel, or re-issue this RFP at any time. This RFP does not obligate the city to pay any costs incurred by the respondents in the preparation and submission of a proposal, nor does it obligate the city to accept or contract for any expressed or implied services. The successful vendor must comply with local, state, and federal requirements regarding equal opportunity and employment practices and the City of Renton Professional Services Agreement (Exhibit D). The city is committed to a program of equal employment opportunity regardless of race, color, creed, sex, age, nationality, or disability. Women and minority business enterprises are encouraged to submit proposals. City of Renton, WA – RFP for Investment Advisory Services 4 | Page SECTION 2 - BACKGROUND The city serves about 105,000 residents in the Puget Sound region and ranks as the eighth largest city in Washington State. The vision of the city is to be the center of opportunity in the Puget Sound Region where families and businesses thrive. The mission of the city, in partnership and communication with residents, businesses, and schools, is dedicated to: • Providing a safe, healthy, welcoming atmosphere where people choose to live. • Promoting economic vitality and strategically positioning Renton for the future. • Supporting planned growth and influencing decisions that impact the city. • Building an inclusive informed city with opportunities for all. • Meeting service demands through high quality customer service, innovation, a positive work environment, and a commitment to excellence. The city operates under the laws of the State of Washington as an “optional municipal code city”. Renton is governed with a mayor-council form of government with eight elected officials. City operations are performed by approximately 900 employees at the direction of the mayor. The city provides a host of services to residents and local businesses: Police, Utilities (water, wastewater, and stormwater), Transportation (street construction and maintenance), Parks and Recreation, Economic Development, Land Use Planning and Regulation, Municipal Courts, and General Government services (animal control and museum system). The city’s intent for this project is to procure investment advisory services that meet the city’s requirements, policy requirement and legal requirements. The city does not currently use an investment advisor. As of March 31, 2025, the cash and investments for the city were approximately $455 million (see Exhibit C). The fiscal year for the city is January 1 to December 31. The city uses U.S. Bank for banking services and Principal Financial for safekeeping services through the State of Washington contract. City of Renton, WA – RFP for Investment Advisory Services 5 | Page SECTION 3 - SCOPE OF WORK , MIN. QUALIFICATIONS AND TIMELINE Scope of Work The city is seeking a non-discretionary investment advisor to ensure fiscal management and investment activity maintains the highest levels of performance and accountability. The purpose of requesting proposals is to determine which firm can offer the highest quality of service at the most reasonable cost. Successful Proposer will provide the city with the following services: • Provide full-time, non-discretionary investment advisory services of the portion of the city’s portfolio under advisement. • Be available in a timely manner, in person, by telephone or e-mail, for consultation or advice. • Review and recommend modifications, as needed, to the City Investment Policy (Exhibit B). • Attend all quarterly Investment Committee meetings and prepare and present written reports to include economic summary information, city investment activity and city compliance with approved policies and state statues. • Perform an independent third-party review of the total portfolio and individual trades. • Evaluate the overall risk to the portfolio associated with securities maintained in the portfolio. Review, recommend, and assist with implementing changes to the current investment portfolio and strategy. • Evaluate the current benchmarking techniques used to assess the portfolio performance, and if needed, provide the city assistance in establishing new benchmarks. • Provide investment advice including break-even analysis and strategic recommendations for portfolio rebalancing to optimize investment opportunities. An example would include the recommendations made to sell low yield securities and replace them with higher yielding securities. • Determine if current reporting practices are adequate, and/or recommend appropriate modifications. • Comply with all Federal and State of Washington laws as well as ordinances, resolutions and policies of the city relating to investment of public funds. • Annually perform due diligence reviews of current and proposed broker/dealers as described in the city investment policy. Monitor the creditworthiness of the financial institutions with which the city does business. Assist in in keeping the authorized financial institution list updated. Monitor the creditworthiness of the city’s depository and custodian bank and investments in the portfolio. • Provide a statement of upcoming cash flows including maturities, coupons, called securities and potential callable investments for a period of 45 days weekly to the city. Upon request, able to perform a statement of upcoming cash flows for a six-month City of Renton, WA – RFP for Investment Advisory Services 6 | Page period. • Provide city staff investment training and technical advice as needed. This includes working with city staff to assure coordination of investment trades, delivery of the securities and availability of funds. Assist with trade settlements. Obtain and document competitive prices for securities transactions. Provide technical and fundamental market research including yield curve analysis and future interest rate movements. • Provide itemized invoices of charges and periodic status reports on the services provided by the firm on monthly basis. Minimum Qualifications: In conjunction with the city’s investment policy (Exhibit B), the following are minimum requirements that the Proposer is expected to meet or exceed: • Be a Registered investment Advisor as defined and regulated by the Securities and Exchange (SEC), be registered in the State of Washington, and whose primary business is municipal investment advisory or investment management services. • Be familiar with all applicable Washington statutes with regards to qualified investments for public entities. • Be completely independent of any financial institution or securities brokerage firm or shall disclose any such relationships relevant to the firm’s relationship with the city. • Have a minimum five-year experience in managing municipal funds, including operating and bond funds. • Must meet the requirements as set forth in the attached Sample Profesional Services Agreement (Exhibit D). • Advisors are preferred to have a minimum of $1 billion dollars in assets under ongoing management. Tentative Timeline The following defines the estimated timeline for the selection of a vendor. The city reserves the right to modify or reschedule this timeline as necessary. Activity Dates Release Request for Proposal June 12, 2025 Vendor Questions Due July 2, 2025 Vendor Questions Answers Posted July 9, 2025 Proposals Due July 18, 2025 Selection of Finalists August 1, 2025 Interview with the City August 2025 Presentation to Investment Committee for Review August-September 2025 Contract Negotiation and Finalization August-September 2025 Presentation to City Council September-October 2025 City of Renton, WA – RFP for Investment Advisory Services 7 | Page SECTION 4 – RFP EVALUATION Evaluation. All proposals meeting the requirements of this RFP shall be reviewed and rated by an evaluation committee according to the following criteria: • Statement of understanding demonstrating full understanding of work to be performed and ability to meet scope of work. • Investment Advisors approach to fulfilling requirements of City’s Investment Policy and Quality of the firm’s standard statements and reporting. • Firm’s stability and past experience working with local governments in State of WA. • Qualifications of the firm, project lead, and project team members for the services required. • Cost proposal fees for the services in the city’s scope of work, which will provide the most comprehensive service at the most reasonable cost. • Quality of references provided including demonstration of efficiencies and improvements provided to similar clients. The city reserves the right to obtain clarification of any point in a proposal or to obtain additional information necessary to properly evaluate the proposal. Failure of a vendor to respond to a request for additional information or clarification may result in rejection of the proposal. The city’s retention of this right shall in no way reduce the responsibility of vendors to submit complete, accurate, and clear proposals. City of Renton, WA – RFP for Investment Advisory Services 8 | Page SECTION 5 – VENDOR INSTRUCTIONS Proposals should be prepared simply and economically, providing straightforward, concise descriptions of the vendor’s ability to satisfy the city’s needs. Emphasis should be placed on completeness and clarity of content. Ownership of all data, materials, and documentation originated and prepared for the city pursuant to this solicitation will belong to the city. All pages or sections of submitted documents considered by the firm to be proprietary in nature should be clearly labeled. Submit your RFP response by the date and time indicated in Section 3 of this RFP to the following email address: finance@rentonwa.gov. Late responses will not be accepted. Responses should include the following: • One electronic PDF copy of your entire RFP proposal in the order defined in the table below. Submission of a proposal shall constitute acknowledgment and acceptance of all terms and conditions contained in this RFP and all exhibits and attachments hereto. Pre-Bidders Questions. Questions regarding this RFP may be submitted to the city at finance@rentonwa.gov by the due date indicated in Section 3 of this RFP. The city will address all questions and post them to the city’s website at http://www.rentonwa.gov/bids by the date indicated in Section 3 of this RFP. It is the responsibility of any Proposer to review the city’s website for any RFP revisions or answers to questions prior to submitting a proposal. No formal pre-bidders conference will be held. Submission Criteria. Vendor responses should include the sections outlined below. Responses that deviate from the requested format may be classified as “non-responsive” and may be disqualified. Marketing literature should not be included in your proposal. Section Description 1. Proposal Due Proposals must be received no later than the date, time and location specified on the cover of this document. Proposals shall clearly identify: 1. RFP number. 2. Title. 3. Name and address of the Proposer. 2. Cover letter All proposals must include a cover letter addressed to the city’s official point of contact and signed by a duty constituted official legally authorized to bind the Proposer to both its proposal and cost schedule. City of Renton, WA – RFP for Investment Advisory Services 9 | Page Section Description The cover letter may summarize the key provisions of the proposal. The cover letter must include the name of the firm and the name, title, address, email address and telephone number, of the person authorized to represent the Proposer and to whom the city should direct correspondence. 3. Project Team 1. Provide a general overview and brief history of your organization, including parent and/or subsidiary companies and number of employees. 2. Please provide names, titles, and contact information for the primary representative/manager/partner-in-charge and any other representatives that will be assigned to the city. 3. How long has the primary representative performed investment advisory services, and how long have other representatives provided advisory services? 4. How many public-sector entities has your organization provided investment advisory services to? What is the size of the public- sector’s portfolio? What types of securities do these entities purchase? Please provide number of clients, size of portfolios, and types of securities. 5. Describe the Proposer’s policy on changing the primary contact person on an account at your discretion. How will changes be communicated to the city? 4. Approach 1. What level of ongoing support will the Proposer provide to the city such as investment decision making, meeting attendance, drafting documents, etc.? 2. Describe your typical project management approach when identifying, recommending, and implementing established or new services to a new or existing client. 5. Qualifications and Requirements 1. The Proposer shall demonstrate their investment experience and qualifications based on the following responses: a) What are primary strategies for adding value to the portfolio (e.g., market timing, credit research, trading, securities lending)? b) What tools and resources does the Proposer use for monitoring public-sector portfolios? Would the city have access to any of these resources? c) Explain how the Proposer would define monitoring the portfolio regarding compliance and strategy, and what processes this would entail? d) Describe the process the Proposer would recommend for revising investment objectives and constraints. City of Renton, WA – RFP for Investment Advisory Services 10 | Page Section Description e) Has the Proposer provided public-sector clients with specific gain/loss recognition decision points for each security within an investment portfolio? Provide examples. f) Provide examples of the economic analysis of trends in the U.S. and World economies that the Proposer provides to other public-sector clients. What type of proactive economic analysis has your firm provided? What impact does this have in advising public sector clients with future investment portfolio strategies? 2. The Proposer shall submit a response addressing any compliance or regulatory concerns that may exist: a) Describe any SEC or regulatory censure or litigation within the past three years involving institutional business your firm conducts with governmental investors or regulatory censure or litigation involving any individuals added to the firm in the past three years. b) How frequently is the Proposer audited by an independent auditing firm? Attach a copy of your organization’s last audit for the most recent fiscal year. c) Does any city employee or officials at the city have any financial or other interest in your agency or this project? If yes, please explain. d) Does your organization guarantee that, in connection with this proposal, the prices and/or cost data have been arrived at independently, without consultation, communication, or agreement for the purpose of restricting competition? If no, please explain. e) Have any of your public-sector clients ever sustained a loss on securities from which your firm advised them, arising from a misunderstanding or misrepresentation of the risk characteristics of the security? If so, explain. 6. Pricing 1. Provide a non-discretionary fee schedule that would apply to the City of Renton’s account. Describe the methodology used (e.g., flat fee, tiered, percentage of assets under management, and how it is calculated). 2. All fee proposals should be fully inclusive, covering every aspect of the investment advisory services as specified in the scope of work, ensuring a comprehensive and transparent pricing structure as much as possible. 3. Identify any fees and expenses that would not be covered under this non-discretionary fee schedule but may be required. Please City of Renton, WA – RFP for Investment Advisory Services 11 | Page Section Description explain why this would be additional charges not included in the original contract. 4. Include payment terms required for services rendered (e.g., monthly or quarterly). Note: Additional pricing information can be supplied if it clarifies or provides relevant detail to your proposal. 7. Implementation Provide an overview of the implementation methodology including: 1. Timeline for completing initial required tasks: review of investment policy, independent third-party review of portfolio, recommended changes to the portfolio, overall risk evaluation, review and establishment of new benchmarks, and delivery of first reports to the city. 2. City resources - roles, responsibilities, average time per month. 3. Vendor resources - roles, responsibilities, average time per month. 4. Training methodology and tools. 8. Support Provide an overview of support services offered including: 1. Availability and guaranteed response time of the firm. 2. Access to reports and tools. 9. References Using Exhibit A, provide references that include three current customers for your non-discretionary investment advisory services. References should be similar in size and scope to the city’s project if possible. 10. Term of Contract The city intends to award this contract (Professional Services Agreement) to a single firm to provide the services required. The term of the contract is anticipated to be from January 1, 2026, through December 31, 2028, and may be extended by up to two (2) years, with a maximum combined contract period of five (5) years. The city reserves the right to award additional contracts from this RFP during the above stated term. 11. Exceptions Document any exceptions you have to the RFP or the city’s Professional Services Agreement provided as Exhibit D to this RFP. City of Renton, WA – RFP for Investment Advisory Services 12 | Page SECTION 6 – TERMS AND CONDITIONS 1. Conditions. The terms, conditions, and scope of work of the RFP, as proposed by the city, along with the successful vendor’s response, as mutually revised through negotiations and incorporated into the Professional Services Agreement (Exhibit D) between the city and the vendor, are intended to form part of the contract documents, provided that the city may exclude any portion of the vendor’s response that introduces ambiguity, is not intended to form a contractual representation, or contains terms deemed unacceptable by the city. 2. Notice to all Proposers/ Standard Agreement. The attached Professional Services Agreement included herein reflects preliminary, draft contract language and selected, proposed contract terms for this procurement. Proposers should be aware that such language terms and provisions are for illustrative purposes only and that the city reserves the right following submission and ranking of all proposals submitted in response to this procurement, to amend, modify or negotiate over any and all such contract language, terms and provisions before making a final determination regarding the execution of the Agreement rising from this procurement. By submitting a proposal in response to this procurement, Proposers acknowledge that they are aware of and do not object to any later, potential amendment and modification of such preliminary, draft language and terms. In addition, by responding to this procurement, Proposers acknowledge that they are aware of their ability to offer alternatives to any of the preliminary, draft contract language and proposed contract terms set forth herein. 3. Errors and Omissions. If a Proposer discovers any ambiguity, conflict, discrepancy, omission or other error in the RFP or any of its attachments, he/she shall immediately notify the city of such error in writing and request modification or clarification of the document. Modifications will be made by addenda. Clarifications will be given by written notice to all parties who have been furnished with or who have requested an RFP, without divulging the source of the request. If a Proposer fails to notify the city prior to the date fixed for submission of proposals of an error in the RFP known to him/her, or an error that reasonably should have been known to him/her, he/she shall bid at his/her own risk, and if he/she is awarded the contract, he/she shall not be entitled to additional compensation or time by reason of the error or its later correction. 4. A ddenda. The city may modify this RFP, any of its key action dates, or any of its attachments, prior to the proposal submittal date. Addenda will be numbered consecutively as a suffix to the RFP reference number. It is the Proposer’s responsibility to ensure they have incorporated all addenda. Failure to acknowledge and incorporate addenda will not relieve the Proposer of the responsibility to meet all terms and conditions of the RFP and any subsequent addenda. All addenda’s will be posted to the city’s website http://www.renton.wa.gov/bids 5. Submission of Proposal. Electronic proposals will be accepted on or before the date and time indicated in Section 3 – Timeline, and in accordance with Section 5 - Vendor Instructions. City of Renton, WA – RFP for Investment Advisory Services 13 | Page 6. Proposer’s Cost. Costs for developing proposals are entirely the responsibility of the Proposer and shall not be chargeable to the city. 7. Delivery of Proposals. All proposals shall be submitted sufficiently by the proposal due date and time to ensure upload to the City of Renton Bid Page prior to the specified due date. The city assumes no responsibility for delays in emailing your proposal to finance@rentonwa.gov. LATE PROPOSALS WILL NOT BE ACCEPTED. 8. City Property . Proposals become the property of the city and information contained therein shall become public project subject to discloser laws. The city reserves the right to make use of any information or ideas contained in the proposal. 9. Confidential Material. Proposer must notify the city in advance of any proprietary or confidential contained in the proposal and provide justification for not making such materials public. The city shall have discretion to disclose or not disclose such material subject to any protective order which Proposer may obtain. 10. Non-Endorsement. In selecting a Proposer to supply products and/or services, the city is neither endorsing nor suggesting that the Successful Proposer’s product is the best or only solution. The Successful Proposer agrees not to refer to the city in any literature, promotional material, brochures, sales presentation, or the like without the city’s express written consent. 11. Rejection of Proposals. The city may reject any or all proposals and may waive any immaterial deviation in a proposal. The city’s waiver of an immaterial defect shall in no way modify the RFP documents or excuse the Proposer from full compliance with the specifications if he/she is awarded the contract. Proposal referring to terms and conditions other than the city’s terms and conditions may be rejected as being non-responsive. 12. Cancellation. This solicitation does not oblige the city to enter into an agreement with any Proposer. The city retains the right to cancel this RFP at any time, at its discretion, for reasons including, but not limited to, the project being canceled, the city loses the required funding, or if it is deemed in the best interest of the city. No obligation, either expressed or implied, exists on the part of the city to make an award or to pay any cost incurred in the preparation or submission of a proposal. 13. Insurance Requirements. The city requires a certification of insurance prior to commencement of any work. An underwriter’s endorsement is also required with additional insured verbiage and the surety must be an admitted surety in the State of Washington. 14. Award of Contract. Award, if any, will be to the Proposer whose proposal best complies with all of the requirements of the RFP documents and any addenda. 15. Notification. Based on the evaluation of the proposals, the city will select a shortlist of approximately three vendors and invite them to participate in an interview with the city. The selected vendors will be notified via e-mail by the date indicated in Section 3. City of Renton, WA – RFP for Investment Advisory Services 14 | Page 16. Interview. Once vendors have been notified of elevation to the shortlist, the city will conduct interview with those vendors. The purpose of the interview is to determine the qualifications and services scope as it relates to the city. 17. Interview Evaluation. An evaluation committee selected by the city will review and evaluate responses in accordance with criteria identified below. Clarification of submitted material may be requested during the evaluation process. The city may award the successful vendor based on their initial proposal and interview. No contract will be awarded until approved by city council. City of Renton, WA – RFP for Investment Advisory Services 15 | Page Exhibit A - References Current Customers Item Response Current Customer #1 Name Approximate Size of Portfolio Investment Approach Average Number of Transactions per Month Investment Portfolio Performance Statistics Additional Information Customer’s Telephone and Email Current Customer #2 Name Approximate Size of Portfolio Investment Approach Average Number of Transactions per Month Investment Portfolio Performance Statistics Additional Information Customer’s Telephone and Email Current Customer #3 Name Approximate Size of Portfolio Investment Approach Average Number of Transactions per Month Investment Portfolio Performance Statistics Additional Information Customer’s Telephone and Email City of Renton, WA – RFP for Investment Advisory Services 16 | Page Exhibit B – Investment Policy CITY OF RENTON – INVEST MENT POLICY POLICY & PROCEDURE Subject: INVESTMENT POLICY Index: Finance & Information Services N u m ber:210-07 Effective Date Supersedes Page Staff Contact Approve 2/23/2009 6/05/2006 1 of15 Iwen Wang 1.0 PURPOSE: To establish policy and procedure for the investment of excess or inactive City funds. 2.0 ORGANIZATIONS AFFECTED: This investment policy applies to the investment of available City funds excluding fire pension funds. 3.0 REFERENCES: City of Renton Ordinance No 5079; Council Meeting Minutes of 6/5/2006; and 2/23/2009; RCW 35.39.030; RCW 36.29.020, as amended; and RCW 39.58.080, as amended. 4.0 POLICY: 4.1 The primary objectives of this policy, in order of priority, of the City of Renton's investment activities shall be: 4.1.1 Safetv: Safety of principal is the foremost objective of the City of Renton. Investments of the City shall be undertaken in a manner that seeks to ensure the preservation of capital in the overall portfolio. To attain this objective, diversification and safekeeping are required in order that potential losses on individual securities do not exceed the income generated from the remainder of the portfolio. 4.1.2 Liquiditv: The City's investment portfolio will remain sufficiently liquid to enable the City to meet all operating requirements that might be reasonably anticipated. 210-07 Investment Policy Page 2 of 15 4.1.3 Return on Investment: The City's investment portfolio shall be designed with the objective of attaining a market rate of return throughout budgetary and economic cycles, taking into account legal limitations,the City's investment risk constraints, and the cash flow characteristics of the portfolio. 4.2 The City has a responsibility in the investment of public funds to seek the highest rate of return available in the market consistent with the primary requirements of legality, safety, liquidity, and return on investment in that order. 4.3 The City of Renton's investment portfolio will strive to achieve a market average rate of return during budgetary and economic cycles,taking into account the City's investment risk constraints and cash flow needs. Market average shall be defined as the average return on U.S. Treasury index selected by the Investment Committee that appropriately reflects the risk and return profile of the City. The appropriate index shall take into consideration the benchmark for traditional public funds management and an analysis of the City's portfolio characteristics core funds, liquid funds, etc). 4.4 Rate speculation will not be a criterion for the selection of an investment. Other criteria, including safety, cash flow, market rates of return, and maturity take preference to rate expectations. 5.0 PROCEDURE 5.1 Delegation of Authority 5.1.1 The Investment Policy of the City of Renton shall be approved by the City Council and made available on its web site, and upon request. The Finance Committee of the City Council shall review the policy at their discretion and recommend suggested changes to the full City Council. 5.1.2 The City Investment Committee shall provide oversight of the investment program. The Committee shall meet quarterly to review reports and actions taken within the City's portfolio. The Committee shall provide advice and direction for the management of the City investment program. The Committee shall be comprised of the Mayor, the Chief Administrative Officer, the Finance and Information Services Administrator, and a member of the City Council. 5.1.3 The Finance and Information Services Administrator is responsible for managing the investment program, with execution of investment transactions delegated to the Fiscal Services Director who shall act as the City's Investment Officer, consistent with procedures established in this policy. The City, with concurrence of the Investment Committee, may hire an investment advisor, on a non-discretionary basis, to assist with the management of the City's investment portfolio. 210-07 Investment Policy Page 3 of 15 5.1.4 The daily operational responsibility for the investment program is delegated to the Fiscal Services Director who shall be responsible for all transactions undertaken. Subordinates within the Fiscal Services Director's office, authorized by City of Renton by Resolution, may be given daily responsibilities to execute specific investments in accordance with all laws, policies, procedures, and directions established under this policy. No person may engage in an investment transaction except as provided under the terms of this policy and the procedures established by the Finance and Information Services Administrator. 5.1.5 The Finance and Information Services Administrator shall be responsible for all transactions undertaken and shall establish a system of controls to regulate the activities of subordinate officials. 5.2 Prudence 5.2.1 The standard of prudence to be applied by the Investment Officer shall be the prudent investor standard that states: "Investments shall be made with judgment and care, under circumstances then prevailing, which persons of prudence, discretion, and intelligence would use in the management of their own affairs, not for speculation, but for investment purposes, considering the probable safety of their capital as well as the probable income to be derived." 5.2.2 The Investment Officer, acting in accordance with the prudent investor standard, written procedures and exercising due diligence, shall not be held personally responsible for a specific security's credit risk or market price changes, provided that these deviations are reported immediately and that appropriate action is taken to control adverse developments. 5.2.3 Employees involved in the City's investments shall recognize that the investment policies and portfolio are subject to public review and evaluation. The overall program shall be designed and managed with a degree of professionalism that is worthy of the public trust. 5.3 Ethics and Conflicts of Interest 5.3.1 Employees involved in the investment process shall refrain from personal business activity that could conflict with proper execution of the investment program, or which could impair their ability to make impartial investment decisions in conformance with City of Renton Policy and Procedure 100-07. Employees involved in the investment process shall disclose to the Mayor and the State of Washington any material financial interests in financial institutions that conduct business with this jurisdiction, and they shall further disclose any large personal financial/investment positions that could be related to the performance of the City's portfolio. Employees shall separate their personal investment transactions from those of the City, particularly with regard to the time of purchases and sales. 210-07 Investment Policy Page 4 of 15 5.4 Internal Controls 5.4.1 The Finance and Information Services Administrator shall establish a controlled environment that shall be reviewed annually by the State Auditor. Such review may result in recommendations to change operating procedures to improve the controlled environment. The controls shall be designed to prevent loss of public funds due to fraud, error, misrepresentation, or imprudent actions. 5.5 Monitoring and Adjusting the Portfolio 5.5.1 The Investment Officer will routinely monitor the contents of the portfolio, the available markets, and the relative values of competing instruments. Future purchase of securities will be made based, in part, upon these observations, and the advice and guidance of the Investment Committee. 5.6 Reporting Requirements 5.6.1 The Investment Officer will generate daily and monthly reports for management purposes. In addition, a quarterly report will be prepared for the Mayor and City Council outlining investment activity and return including a summary of status of the portfolio, book value and market value of securities held, unrealized gains and losses, book yield, and average yields compared to established performance standards. 5.7 Authorized Investments 5.7.1 City of Renton funds may be legally invested in any of the securities identified as eligible investments as defined by RCW 35A.40.050 "Fiscal - Investment of Funds," as interpreted by the most current edition of the Office of the State Treasurer, State of Washington publication titled "Eligible Investments for Public Funds." 5.7.2 Repurchase Agreements entered into by the City of Renton must have as collateral U.S. Treasury securities or guaranteed federal agency obligations. Such collateral must equal or exceed 102 percent of the purchase price. For long term repos, collateral must be marked to market daily and the repurchase agreement must include provisions to make up any deficiencies. A master repurchase agreement shall be developed that spells out the nature of the agreement, remedies in the event of default by either party, and provisions requiring that the collateral securities are delivered to the City of Renton, or to an approved third party custodian prior to transfer of funds. 5.7.3 Reverse Repurchase Agreements are not permitted unless approved in writing by the Mayor of the City of Renton, and with the advice and consent of the Council by passage of a formal resolution approving such transaction. 210-07 Investment Policy Page5of15 5.7.4 Derivatives, or securities that derive security value and/or yield from an underlying asset or an external index are prohibited unless they fall into one of the following categories: 1) Zero coupon treasury instruments 2) Agency security obligations that have call features 3) Agency security obligations that step-up in coupon value at pre-determined intervals. Agency obligations that step-up may also have call features 4) Agency obligations that float with interest rates or external indexes such as treasury bills, LIBOR, COFI, or the Federal Funds rate. Agency obligation inverse floaters are prohibited. Examples of the exceptions listed above, which are permitted investments, are as follows: 1) Zero coupon treasury bonds. 2) Federal Home Loan Bank Bonds that are callable on certain dates throughout the life of the bond with a final maturity date of the bond known at the time of purchase. Callable issues offer higher rates of interests because of the risk associated with the bonds potentially being called before the final maturity date. If these bonds are called,the par value of the bonds is returned to the purchaser. 3) Federal Home Loan Bank Bonds that have a step-up feature increase in coupon value at pre-determined intervals. Normally, step-up bonds change in coupon value once a year. These bonds may also have call features. 4) Federal National Mortgage Association Bonds that float with external index such as the Federal Funds Rate. These bonds are purchased to protect against increasing interest rates. These bonds usually adjust quarterly to their index. Treasury instruments that are considered derivatives will not exceed 20 percent of the total treasury instrument portion of the general governmental portfolio. Agency security obligations that are considered derivatives will not exceed 50 percent of the agency security obligation portion of the general governmental portfolio. This prohibition on derivatives includes collateralized mortgage obligations and any security obligation that the maturity date is not established at the time of purchase. 5.8 Authorized Financial Dealers and Authorized Financial Dealers and Institutions 5.8.1 The Investment Officer will maintain a list of financial institutions as required by the Public Deposit Commission, authorized to provide investment services. In addition, a list will also be maintained of approved security broker/dealers selected by credit worthiness, who maintain an office in the State of Washington. These may include primary dealers or regional dealers that qualify under SEC Rule 15C3-1 (uniform net capital rule). No public deposit shall be made except in a qualified public depository with offices located in the State of Washington. 210-07 Investment Policy Page 6 of 15 5.8.2 Employees of any firm or financial institution offering securities to the City of Renton are expected to have both Series 7 and Series 63 licenses and be trained in the precautions appropriate to public-sector investments. These firms and financial institutions are expected to familiarize themselves with the City of Renton's investment objectives, policies and constraints. In addition, these firms and financial institutions are expected to take reasonable efforts to preclude imprudent transactions involving the City of Renton's funds. 5.9 Quotes and Selection of Investment Instruments 5.9.1 Except in the case of the Loca) Government Investment Pool (LGIP), before the City invests any surplus funds, a competitive quote process shall be conducted. If a specific maturity date is desired for cash flow purposes, quotes will be requested for instruments that meet the maturity requirement. If no specific maturity is required, a market trend (yield curve) analysis will be conducted to determine which maturity would be most advantageous. 5.9.2 Quotes will be requested from at least three previously qualified Authorized Dealers. The quotes will evaluate various options with regards to term and instrument. The City will accept the quote that provides the best alignment with these policies, including diversification as defined by the Investment Committee. Records shall be kept of the quotes offered, (until the financial audit is completed for the year), the quotes accepted and a brief explanation of the decision that was made regarding the investment. The Investment Committee shall review such activity. 5.10 Term of Investments 5.10.1 The City will attempt to match its investments with anticipated cash flow requirements. Unless matched to a specific cash flow, the City will not directly invest in securities maturing more than ten years from the date of purchase. The average weighted life of the City's portfolio shall not be more than 30 months without express written and unanimous approval of the Investment Committee. Where the Committee provides authority to extend the average life of the portfolio, it shall state the parameters that shall govern in lieu of this policy limit, including a time during which this exception shall be in force. 5.10.2 The City may sell or exchange securities, at their option, to maintain liquidity or upgrade yield. Such actions may be initiated by the Investment Officer, and requires the written concurrence of the Investment Committee. 210-07 Investment Policy Page7of15 5.11 Diversification 5.11.1 The City will diversify use of investment instruments to avoid incurring unreasonable risks inherent in over-investing in specific instruments, individual financial institutions or maturity dates. The diversification will consider the market climate and cash flow demand at the time of investment in that the instruments selected will be the most advantageous for the City without exceeding the maximum limitations set forth below. The target distribution will guide investment decisions during normal economic time. Target Portfolio Distribution by Investment US Treasury Securities 0% WA State Local Government Investment Pool 40% US Federal Agency Securities 30% Certificates of Deposit (within PDPC) 30% Commercial Paper 0% Total Portfolio 100% Maximum constraints by Instrument US Treasury Securities 100% WA State Local Government Investment Pool 75% US Federal Agency Securities 75% Certificates of Deposit (within PDPC) 75% Commercial Paper 25% Distribution by Institution (Issuer) US Treasury Securities 100% WA State Local Government Investment Pool 75% US Federal Agency Securities 50% Certificates of Deposit (within PDPC) 20% Commercial Paper 5% Non-compliance to any of the limitations during a period of transition will be acceptable when a change is made to the portfolio allocation. For purposes of this policy, federal agency debt shall be subject to the 25 percent rule and shall be considered on an agency-by-agency basis. The single financial institution limitation means direct investments in that institution (such as Certificates of Deposit) and shall not apply to investments in other institutions made via an institution. 5.11.2 Portfolio maturity shall be staggered to avoid undue concentration of assets in a specific maturity sector and to mitigate reinvestment risk. Maturity selected shall provide for stability of income and reasonable liquidity in view of cash flow projections. 210-07 Investment Policy Page 8 of 15 5.12 Safekeeping and Custody 5.12.1 All security transactions, including collateral for repurchase agreements, entered into by the City of Renton shall be conducted on a delivery-versus-payment (DVP) basis. A third party custodian designated by the Finance and Information Services Administrator will hold securities. Certificates of Deposit will be delivered to and held by the Finance Department. 5.12.2 It is the intent of the City of Renton to select the primary bank for such services as bank depository, warrant processing and custodial services through a bid process. These services may be bid separately or together, depending on what is in the City of Renton's best interest. 6.0 DEFINITIONS: ACCRUED INTEREST: The interest accumulated on a bond since issue date or the last coupon payment. The buyer of the bond pays the market price and accrued interest, which is payable to the seller. AGENCY SECURITY OBLIGATIONS: U.S. Government issued security that was not issued by the Treasury Department. These issues include: Federal Home Loan Bank Bonds (FHLB), Federal National Mortgage Association (FNMA), Federal Farm Credit Bank (FFCB), Federal Home Loan Bank Mortgage Corporation (FHLMC), and Student Loan Marketing Association (SLMA). AVERAGE MATURITY: A weighted average of the expiration dates for a portfolio of debt securities. An income fund's volatility can be managed by shortening or lengthening the average maturity of its portfolio. BANK WIRE: A virtually instantaneous electronic transfer of funds between two financial institutions. BANKERS ACCEPTANCE (BAs): Bankers Acceptances generally are created based on a letter of credit issued in a foreign trade transaction. They are used to finance the shipment of commodities between countries as well as the shipment of some specific goods within the United States. BAs are short-term, non-interest-bearing notes sold at a discount and redeemed by the accepting bank at maturity for full face value. These notes trade at a rate equal to or slightly higher than Certificates of Deposit (CDs), depending on market supply and demand. Bankers Acceptances are sold in amounts that vary from $100,000 to $1,000,000 or more with maturities ranging from 30- 270 days. They offer liquidity to the investor, as it is possible to sell BAs prior to maturity at the current market price. BASIS POINT: A measure of an interest rate, i.e., 1/100 of 1 percent, or .001. 210-07 Investment Policy Page9of15 BOND: A long-term debt security, or IOU, issued by a government or corporation that generally pays a stated rate of interest and returns the face value on the maturity date. BOOK ENTRY SECURITIES: U.S. Government and federal agency securities that do not exist in definitive (paper) form;they exist only in computerized files maintained by the Federal Reserve Bank. BOOK VALUE: The amount at which an asset is carried on the books of the owner. The book value of an asset does not necessarily have a significant relationship to market value. CALLABLE AGENCY OBLIGATION SECURITY: A condition of an agency obligation security permitting the issuer to redeem it, before maturity, on specified dates. CERTIFICATES OF DEPOSIT: Certificates of Deposit, familiarly known as CDs, are certificates issued against funds deposited in a bank for a definite period of time and earning a specified rate or return. Certificates of Deposit bear rates of interest in line with money market rates current at the time of issuance. COMPETITIVE QUOTE PROCESS: A process by which three or more institutions are contacted via the telephone to obtain interest rates for specific securities. COLLATERALIZED MORTGAGE OBLIGATION: Derivative security created by dividing the cash flows of a pool of mortgages into obligations having different maturities than the mortgages. CMOs are risky because of the relationship between interest rates and mortgage prepayments. When interest rates fall more mortgages are paid off, impacting the cash flows of CMOs and overall return. CREDIT RISK: The risk that another party to an investment transaction will not fulfill its obligations. Credit risk can be associated with the issuer of a security, a financial institution holding the entity's deposit, or a third party holding securities or collateral. Credit risk exposure can be affected by a concentration of deposits or investments in any one investment type or with any one party. CUSTODIAN: An independent third party (usually bank or trust company) that holds securities in safekeeping as an agent for the City. DEFEASE: To discharge the lien of an ordinance, resolution, or indenture relating to a bond issue, and in the process, rendering inoperative restrictions under which the issuer has been obliged to operate. Comment: ordinarily an issuer may defease an indenture requirement by depositing with a trustee an amount sufficient to fully pay all amounts under a bond contract as they become due. 210-07 Investment Policy Page 10 of 15 DELIVERY: The providing of a security in an acceptable form to the City or to an agent acting on behalf of the City and independent of the seller. Acceptable forms can be physical securities or the transfer of book entry securities. The important distinction is that the transfer accomplishes absolute ownership control by the City. DELIVERY vs. PAYMENT: There are two methods of delivery of securities: delivery vs. payment and delivery vs. receipt (also called free). Delivery vs. payment is delivery of securities with an exchange of money for the securities. Delivery vs. receipt is delivery of securities with an exchange or a signed receipt for the securities. DEPOSITARY BANK: A local bank used as the point of deposit for cash receipts. DEPOSITARY INSURANCE: Insurance on deposits with financial institutions. For purposes of this policy statement, depositary insurance includes: a) Federal depositary insurance funds, such as those maintained by the Federal Deposit Insurance Corporation (FDIC) and Federal Savings and Loan Insurance Corporation (FSLIC); and b) Public Deposit Protection Commission. DERIVATIVE: A financial instrument whose value is based on, and determined by, another security or benchmark. DISCOUNT: 1. (n.) selling below par; e.g., a $1,000 bond sell for$900. 2. (v.) anticipating the effects of news on a security's value; e.g., "the market had already discounted the effect of the labor strike by bidding the company's stock down." DIVERSIFICATION: Dividing available funds among a variety of securities and institutions so as to minimize market risk. EFFECTIVE RATE: The yield you would receive on a debt security over a period of time taking into account any compounding effect. FACE VALUE: The value of a bond stated on the bond certificate; thus, the redemption value at maturity. Most bonds have a face value, or par, of$1,000. FEDERAL AGENCY SECURITIES: Several government-sponsored agencies, in recent years, have issued short and long-term notes. Such notes typically are issued through dealers, mostly investment banking houses. These Federal government-sponsored agencies were established by the U.S. Congress to undertake various types of financing without tapping the public treasury. In order to do so, the agencies have been given the power to borrow money by issues securities, generally under the authority of an act of Congress. These securities are highly acceptable and marketable for several reasons, mainly because they are exempt from state, municipal and local income taxes. Furthermore, agency securities must offer a higher yield than direct Treasury debt of the same maturity to find investors, partly because these securities are not direct obligations of the Treasury. The main agency borrowing institutions are the Federal National Mortgage Association (FNMA), the Federal Home Loan Bank System FHLB), and the Federal Farm Credit System (FFCS). 210-07 Investment Policy Page11of15 FNIVIA: FEDERAL NATlQNA MQRTGAGE ASSQCIATIt N - issues notes taifored to the maturity neecf of the investor. Maturities range from 30 days up ta 10 years. These notes are made attractive by their denominations fram $5,000 to $1 miflian. FHLB: FEDERAL HtJME LOAN BANK SYSTEM - consists of twelve Federa) Home Laan Banks, issues, in additian to long-term bonds, caupon notes with maturities of up to one year. Their attractiveness stems from their investment denominations of$10,000 to $1 million. FEDERAL DEPOSIT INSURANCE CORPORATION (FDIC): A Federal institution that insures bank deposits. 7he current limit is up to $100,000 per deposit, FEDERAL FUNDS RATE: The rate of interest at which Fed Funds are traded between banks. Fed Funds are excess reserves held by banks that desire to invest ar lend them ta banks needing reserves. The particular rate is heavily influenced thraugh the oper market operations of the Federal Reserve 8oard. Also referred ta as the "Fed Funds rate." FEDERAL HOME LOAN BANKS FHLB): The institutions that regulate and lend to savings and loan assaciatians. FEDERAL NATIONAL MORTGAGE ASSOCIATiON (FNMA): FNMA, like GNMA, was chartered under the Federal Nationa) Mortgage Association Act in 1938. FNMA is a Federa) carporation working under the auspices of the Department of Housing and Urban Development, HUD. It is the largest single provider of residential mortgage funds in the United States. Fannie Mae, as the corporation is called, is a private stockholder-owned corporatian. The corparation's purchases include a variety of adjustable mortgages and secand loans, in addition to fixed-rate mortgages. FNMA's securities are also highly liquid and widely accepted. FNMA assumes and guarantees that all security holders will receive timely payment of principal and interest. FEDERAL RESERVE SY5TEM: The central bank of the United States that has regulated credit in the economy since its inception in 1913. Includes the Federa! Reserve Bank, 14 district banks and the member banks of the Federal Reserve, and is gaverned by the Federal Board. FEDERAL SAVENGS AND LOAN INSURANCE CORPORATIaN (FSLIC}: A federa) institution that insures savings and laan depasits. i"he current limit is up to $100,000 per deposit. FLEXIBLE REPURCHASE AGREEMENTS (Fiex Repos): Similar to a term repurchase agreement, a flex repo is a contractual transfer of U.S. Government securities during the investment periad, whereby the Seller agrees to repurchase the caliateral securities from the Buyer on the Buyer's demand, subject to provisians of the agreement. The Seller is generally a financial institution such as a securities dealer or a bank. As buyers, most issuers require over collateralizatian, marking-to-market of co!lateral and delivery-vs.-payment of coNateral. F QATER: A floating rate derivative security in which the interest rate varies with an index such as T-bills. 210-07 Investment Policy Page 12 of 15 F OATER (AGENCY OBUGATION SECURITY): A candition of an agency abligation security where the caupon valtae of interest is determined fram an external index or interest rate. GINNiE MAES (GNMAs}: Mortgage securities issued and guaranteed, as to timely interest and principal payments, by the Gavernment National Martgage Association, an agency within the Department af Housing and Urban Development (HUD). GOVERNMENT SECURITY: Any debt obligations issued by the U.S. Government, its agencies or instrumentalities. Certain securities, such as Treasury bonds and Ginnie Maes, are backed by the government as to both principal and interest payments. Other securities, such as those issued by the Federa! Name Loan Mortgage Corporation, or Freddie Mac, are backed by the issuing agency. fNVERSE FIOATER: Structured notes or derivatives designed to rise in yield as interest rates fall. Also ealled Reverse Floater. This is an e ctremely volatiEe security. iNVESTMENT OFFICER: The City of Renton Fiscai Services Director (or designee), who is responsible for the day-ta-day activity af the City's investment program. LIQUIDATION: Conversion inta cash. LIQUIDITY: Refers to the ease and speed with which an asset can be converted into cash withaut a substantial loss in value. LOSS: The excess of the cost ar boak value of an asset over selling price. CAL GQVERNMENT INVESTMENT PC?OL (GIP): The aggregate of all funds from poEitical subdivisians that are placed in the custody af the State Treasurer for investment and reinvestment. MARKETABiUTY: Ability to sell large blocks of money marke# instruments quickly and at competitive prices. MARKET VALUE: The price at which a security is trading and could presumably by soid. MARKET RISK: The risk that the market va(ue of an investment, collateral protecting a deposit, or securities underlying a repurchase agreement will decline. MASTER AGREEMENT: An agreement that is controlling over all transactions covered by it an an open-ended basis. A new contract is not required far each new transaction. MATURITY: The date upon which the principal ar stated value of an investment becorrtes due. PAR Val.UE: The nominal or face value af a debt security;that is,the value at maturity. 210-07 Investment Policy Page13of15 PREMIUM: The amount by which a bond sells above its par value. PRIMARY DEALERS: A group of government securities dealers that submit daily reports of market activity and positions and monthly financial statements to the Federal Reserve Bank of New York and are subject to its informal oversight. Primary dealers include Securities and Exchange Commission (SEC), registered securities broker-dealers, banks, and a few unregulated firms. PRIME RATE: The interest rate a bank charges on loans to its most creditworthy customers. Frequently cited as a standard for general interest rate levels in the economy. PRINCIPLE: An invested amount on which interest is charged or earned. QUALIFIED PUBLIC DEPOSITARY: A financial institution that does not claim exemption from the payment of any sales, or compensating use or ad valarem taxes under the laws of this state, which has been segregated for the benefit of the commission eligible collateral having a value of not less than its maximum liability, and which has been approved by the Public Deposit Protection Commission to hold public deposits. REGISTERED SECURITY: A security that has the name of the owner written on its face. A registered security cannot be negotiated except by the endorsement of the owner. REPURCHASE AGREEMENT (REPO): A Repo is a contractual transaction between an investor and an issuing financial institution (not a secured loan). The investor exchanges cash for temporary ownership of specific securities, with an agreement between the parties that on a future date, the financial institution will repurchase the securities at a prearranged price. An Open Repo" does not have a specified repurchase date and the repurchase price is established by a formula computation. REPRICING: The revaluation of the market value of securities. REVERSE REPOs: The opposite of the transaction undertaken through a regular repurchase agreement. In a "reverse" the City initially owns securities and the bank or dealer temporarily exchanges cash for this collateral. This is, in effect, temporarily borrowing cash at a high interest rate. Most typically, a Repo in initiated by the lender of funds. Reverses are used by dealers to borrow securities they have shorted. Such investments are not authorized in the City of Renton's Investment Policy. SAFEKEEPING: A service to customers rendered by banks for a fee whereby all securities and valuables of all types and descriptions are held in the bank's vaults for protection, or in the case of book entry securities, are held and recorded in the customer's name and are inaccessible to anyone else. 210-07 Investment Policy Page 14 of 15 SALLIE MAES: Pooling of student loans guaranteed by the Student Loan Mortgage Associations SLMA) to increase the availability of education loans. The SLMA purchases the loans after buying them on the secondary market from lenders. SLMA stock is publicly traded. SECURITIES: Bonds, notes, mortgages, or other forms of negotiable or non-negotiable instruments. SETTLEMENT DATES: The day on which payment is due for a securities purchase. For stocks and mutual funds bought through an investment dealer, settlement is normally five business days after the trade date. Bonds and options normally settle one business day after the trade date mutual fund shares purchased directly by mail or wire settle on the day payment is received. STEP-UP AGENCY OBLIGATION SECURITY: A condition of an agency obligation security where the coupon value of interest increases at pre-determined intervals. STRIPPED TREASURIES: U.S. Treasury debt obligations in which brokerage houses, creating zero-coupon bonds, remove coupons. THIRD-PARTY SAFEKEEPING: A safekeeping arrangement whereby the investor has full control over the securities being held and dealer or bank investment department has no access to the securities being held. TIME DEPOSIT: Interest-bearing deposit at a savings institution that has a specific maturity. TREASURY BILLS: Treasury bills are short-term debt obligations of the U.S. Government. They offer maximum safety of principal since they are backed by the full faith and credit of the United States Government. Treasury bills, commonly called "T-Bills," account for the bulk of government financing, and are the major vehicle used by the Federal Reserve System in the money market to implement national monetary policy. T-Bills are sold in three, six, nine, and twelve-month bills. Because treasury bills are considered "risk-free," these instruments generally yield the lowest returns in the major money market instruments. TREASURY NOTES AND BONDS: While T-Bills are sold at a discount rate that established the yield to maturity; all other marketable treasury obligations are coupon issued. These include Treasury Notes with maturities from one to ten years and Treasury Bonds with maturities of 10-30 years. The instruments are typically held by banks and savings and loan associations. Since Bills, Notes, and Bonds are general obligations of the U.S. Government, and since the Federal Government has the lowest credit risk of all participants in the money market, its obligations generally offer a lower yield to the investor than do other securities of comparable maturities. UNDERLYING SECURITIES: Securities transferred in accordance with a repurchase agreement. 210-07 Investmen Policy Page I 5 af i 5 11.5. GOVERNMENT AGENCY SECURITIES: A variety of securities issued by severa! U.S. agencies. Some are issued on a discount basis and some are issued with coupons. Some are backed by the full faith and credi#guarantee of the U.S. Government, while others are nat. WHEN-ISSUED TRADES: Typically there is a lag between the time a new bond is announced and sald and the time is actually issued. During this interval, the security trades "wi" -- "when, as, and if issued." WI: When, as, and if issued. See When-issued trades. YIELD: The rate at which an investment pays out interest or dividend income, expressed in percentage terms and calculated by dividing the amount paid by the price af the security and annualizing the result. YIELD BASIS: Stated in #erms of yield as opposed to price. As yield inereases for a traded issue, price decreases and vice versa. Charts prepared an a yield basis appear exactly appasite of those prepared an a price basis. YIELD SPREAD: The variatian between yields on different types of debt securities; generally a function of supply and demand, credit qualifiy and expected interest rate fluctuations. Treasury bonds, for example, because they are so safe, will normaliy yield less than corporate bands. Yields may also differ on similar securities with different maturities. Long-term debt, for example, carries more risk of market changes and issuer defaults than short-term debt and thus usually yields more. ZERC}-COUPC?N BONDS: Securities that do not pay interest but are instead sold at a deep discount fram face value. They rise in price as the mat arity date nears and are redeemed at face value upan maturity. City of Renton, WA – RFP for Investment Advisory Services 17 | Page Exhibit C – 2025 Q1 INVESTMENT PORTFOLIO Overview of portfolio 1 Portfolio detail 2 Maturities and outlook 3 Portfolio performance against benchmarks 4 Cash and investments by fund 5 PDPC report 6 Most recent report (2/28/2025) Investment emerging issues Today's agenda by Nate Malone, Budget & Accounting Manager Finance Department Investment Activity Report Quarter Ended March 31st, 2025 Presented to the Investment Advisory Committee Overview of Main Portfolio Blended1 Core2 60 60 13 29 Blended1 Core2 3.85% 3.50% 1 Blended = Liquid (Cash+LGIP) plus Core Portfolio 2 Core = Main investments of the city defined maturities (fire pension is excluded) Current % Blended Allowed by policy Current Portfolio (principal value) 9%N/A $ 43,227,082 19%100%86,961,602$ 47%75%212,441,281$ 19%75%85,478,422$ 6%75%27,028,128$ 0%25%-$ CORE PORTFOLIO INVESTMENTS 100%455,136,515$ Fire Pension Portfolio 356,701$ TOTAL CASH AND INVESTMENTS 455,493,216$ *Excluding cash the portfolio distribution is 51.6% LGIP, 21.1% US Treasury, 20.7% Agency Securities and 6.6% CDs 0.211118259 By Institution Current % Blended Allowed by policy Current Portfolio (principal value)Maturity Date APY Weighted Yield Blended Current Principal Balance Cash US Bank - Cash 9% N/A 43,227,082 overnight 2.75% 0.26%43,227,082 US Treasury Securities* 421259B TREASURY 9,722,266 6/30/2025 1.05% 0.02% 421259A TREASURY 9,746,094 11/30/2025 1.01% 0.02% 425269A TREASURY 4,918,555 1/31/2026 4.23% 0.05% 424269A TREASURY 5,064,325 7/31/2026 3.64% 0.04% 324269A TREASURY 4,715,039 11/30/2026 4.17% 0.04% 424279A TREASURY 4,969,922 1/15/2027 4.22% 0.05% 424279B TREASURY 4,763,281 2/28/2027 4.13% 0.04% 423279A TREASURY 4,891,016 6/30/2027 3.83% 0.04% 424289B TREASURY 4,509,961 1/31/2028 4.11% 0.04% 423289A TREASURY 4,445,313 3/31/2028 3.77% 0.04% 423289B TREASURY 4,482,700 4/30/2028 3.85% 0.04% 423289C TREASURY 4,950,084 8/15/2028 3.86% 0.04% 425289A TREASURY 4,976,016 9/30/2028 4.42% 0.05% 424289A TREASURY 5,047,656 12/31/2028 3.51% 0.04% 324299E TREASURY 4,960,938 10/31/2029 4.18% 0.05% 425309A TREASURY 4,798,438 3/31/2030 4.50% 0.05% Local Government Investment Pool 3920 State Investment Pool 47%75%212,441,281 4/1/2025 4.40% 2.05% 212,441,281 US Federal Agency Securities* 320259A FHLB 9,980,200 9/12/2025 0.42% 0.01% FHLB 5,018,520 6/8/2029 4.54% 0.05% FHLB 2,062,040 3/10/2028 3.79% 0.02% FHLB 4,995,350 6/9/2028 4.02% 0.04% FHLB 5,015,200 2/15/2029 4.10% 0.05% 321259A FHLB 5,044,875 12/10/2027 4.05% 0.04% 323269A FHLB 5,018,200 3/13/2026 3.99% 0.04% 322269B FNMA 4,722,663 4/24/2026 3.90%0.04% 322269A FNMA 4,672,300 9/24/2026 3.54%0.04% 323269B FNMA 5,386,082 5/15/2029 4.50%0.05% 324279B FNMA 4,390,625 10/8/2027 4.70%0.05% 323279B FNMA 4,191,075 11/15/2027 3.85%0.04%12/10/2027 405%004%323289A FFCB 4,986,918 10/22/2026 3.96%0.04% FFCB 5,000,000 5/6/2027 4.75%0.05% FFCB 4,975,050 7/14/2027 4.00%0.04% 323289B FFCB 5,071,825 12/20/2029 3.57% 0.04% 324299A FHLMC 1% 50% 4,947,500 9/23/2025 0.64% 0.01%4,947,500 Certificates of Deposit 124274A First Savings Bank Northwest 5,853,567 8/16/2027 4.66% 0.06% 122254A First Savings Bank Northwest 5,623,397 8/16/2025 2.40%0.03% 123284A First Savings Bank Northwest 5,551,164 11/1/2028 4.50% 0.05% 124294A First Savings Bank Northwest 10,000,000 8/8/2029 4.31% 0.09% Fire Pension Portfolio* US Treasury Strip 356,701 Multiple 5.60% 0.00%356,701 Commercial Paper none 0%5%- - 455,493,216$ 455,493,216$ 20,033,793 23,362,745 5%50% 6%20%27,028,128 TOTAL CASH & INVESTMENTS *Held in our safekeeping account at Principal Financial 8%50%37,134,385 4%50% Commercial Paper 19%100%86,961,602 By Type Cash US Treasury Securities Local Government Investment Pool US Federal Agency Securities (GSE) Certificates of Deposit March 31, 2025 Weighted Average Maturity excluding fire pension Duration allowed by policy Current Duration (in months) Weighted Average Yield excluding fire pension Current Cash 9% US Treasury 19% LGIP 47% GSE's 19% CD's 6% Distribution by Type 0.00% 0.50% 1.00% 1.50% 2.00% 2.50% 3.00% 3.50% 4.00% 4.50% RENTON CORE RENTON BLENDED SIP FED FUNDS RATE 2Y TREAS 3.50%3.85% 4.40%4.33%3.97% How do we compare? (see performance measures) City of Renton Investment Report Q1 2025 Page 1 City of Renton Investment Portfolio Liquid Portfolio Inv #Institution Instrument Settlement Date Maturity Date Effective Rate Weighted Yield Weighted Average # Days Principal CASH US Bank CASH 3/31/2025 4/1/2025 2.75%0.0046 0.2 43,227,082$ 3920 State Investment Pool LGIP 3/31/2025 4/1/2025 4.40%0.0366 0.8 212,441,281$ TOTALS 4.12%1 255,668,362 WAY days (Princ/Total)xYTM (Princ/Total)xDays to Maturity Core Portfolio (Cost/Total)xCoupon (Cost/Total)xDays Inv #Institution Instrument Settlement Date Maturity Date YTM/APY Weighted Yield Weighted Average # Days Cost Amount 421259B TREASURY US TREASURY 12/15/2021 6/30/2025 1.05%0.0005 4 9,722,266 122254A First Savings Bank NW CD 8/29/2022 8/16/2025 2.40%0.0007 4 5,623,397 320259A FHLB AGENCY 9/11/2020 9/12/2025 0.42%0.0002 8 9,980,200 321259A FHLMC AGENCY 8/23/2021 9/23/2025 0.64%0.0002 4 4,947,500 421259A TREASURY US TREASURY 10/27/2021 11/30/2025 1.01%0.0005 12 9,746,094 425269A TREASURY US TREASURY 1/13/2025 1/31/2026 4.23%0.0010 8 4,918,555 323269A FHLB AGENCY 3/28/2023 3/13/2026 3.99%0.0010 9 5,018,200 322269B FNMA AGENCY 12/15/2022 4/24/2026 3.90%0.0009 9 4,722,663 424269A TREASURY US TREASURY 10/2/2024 7/31/2026 3.64%0.0009 12 5,064,325 322269A FNMA AGENCY 6/15/2022 9/24/2026 3.54%0.0008 13 4,672,300 323269B FFCB AGENCY 5/22/2023 10/22/2026 3.96%0.0010 14 4,986,918 324269A TREASURY US TREASURY 11/8/2024 11/30/2026 4.17%0.0010 14 4,715,039 424279A TREASURY US TREASURY 2/9/2024 1/15/2027 4.22%0.0011 16 4,969,922 424279B TREASURY US TREASURY 12/11/2024 2/28/2027 4.13%0.0010 17 4,763,281 324279A FFCB AGENCY 5/24/2024 5/6/2027 4.75%0.0012 19 5,000,000 423279A TREASURY US TREASURY 5/23/2023 6/30/2027 3.83%0.0009 20 4,891,016 323279A FFCB AGENCY 2/10/2023 7/14/2027 4.00%0.0010 21 4,975,050 124274A First Savings Bank NW CD 8/16/2024 8/16/2027 4.66%0.0014 25 5,853,567 324279B FNMA AGENCY 5/24/2024 10/8/2027 4.70%0.0010 20 4,390,625 323279B FNMA AGENCY 3/28/2023 11/15/2027 3.85%0.0008 20 4,191,075 322279A FHLB AGENCY 11/23/2022 12/10/2027 4.05%0.0010 25 5,044,875 424289B TREASURY US TREASURY 12/11/2024 1/31/2028 4.11%0.0009 23 4,509,961 323289A FHLB AGENCY 5/22/2023 3/10/2028 3.79%0.0004 11 2,062,040 423289A TREASURY US TREASURY 5/23/2023 3/31/2028 3.77%0.0008 24 4,445,313 423289B TREASURY US TREASURY 12/21/2023 4/30/2028 3.85%0.0009 25 4,482,700 323289B FHLB AGENCY 6/21/2023 6/9/2028 4.02%0.0010 29 4,995,350 423289C TREASURY US TREASURY 12/21/2023 8/15/2028 3.86%0.0010 31 4,950,084 425289A TREASURY US TREASURY 1/13/2025 9/30/2028 4.42%0.0011 32 4,976,016 123284A First Savings Bank NW CD 11/2/2023 11/1/2028 4.50%0.0013 36 5,551,164 424289A TREASURY US TREASURY 10/2/2024 12/31/2028 3.51%0.0009 35 5,047,656 324299A FHLB AGENCY 2/15/2024 2/15/2029 4.10%0.0010 36 5,015,200 324299C FNMA AGENCY 5/24/2024 5/15/2029 4.50%0.0012 41 5,386,082 324299B FHLB AGENCY 5/24/2024 6/8/2029 4.54%0.0011 38 5,018,520 124294A First Savings Bank NW CD 8/8/2024 8/8/2029 4.31%0.0022 80 10,000,000 324299E TREASURY US TREASURY 11/8/2024 10/31/2029 4.18%0.0010 42 4,960,938 324299D FFCB AGENCY 10/2/2024 12/20/2029 3.57%0.0009 44 5,071,825 425309A TREASURY US TREASURY 1/13/2025 3/31/2030 4.50%0.0011 44 4,798,438 Core Portfolio 3.50%2.41 199,468,152$ Maturing/Callable in next quarter WAY years New since last quarter MV/(TotalxYTM) MV/(TotalxDays to Mat)/360 Total Overnight + Main Portfolio 0.038466261 1.06 455,136,515$ WAY years MV/(TotalxYTM) MV/(TotalxDays to Mat)/360 Fire Pension Portfolio (Maturity - Settlement)(Cost/Total)xCoupon (Cost/Total)xDays Inv #Instrument CUSIP Settlement Date Maturity Date Coupon Weighted Yield Weighted Average # Days Cost Basis 4286 US TREAS STRIP 912803BF9 11/15/2003 8/15/2025 5.60%0.0560 137 356,701 Total Portfolio 5.60%0 356,701$ WAY years (Cost/Total)xCoupon ((Cost/Total)xDays to Maturity)/360 Fund 611 receives a proportionate share of the interest revenue from liquid and core portfolios as described above (monthly); interest revenue for pension maturities are recorded upon receipt; accrued interest is recorded only in the 14th period for financial statements. Interest from State Investment Pool allocated to funds based on cash position, monthly. Earnings credit on cash recorded to funds based on cash position, annually. City of Renton Investment Report Q1 2025 Page 2 Maturities and Outlook Outlook: Core Portfolio Pending Maturities 0-6 months 6-12 months 1-2 years 2-3 years 3-5 years Total 30,273,362$ 19,682,848$ 33,894,447$ 40,918,209$ 74,699,286$ 199,468,152$ 1.13%3.08%3.94%4.19%4.12%Average YTM $30,273,362 $19,682,848 $33,894,447 $40,918,209 $74,699,286 $- $10,000,000 $20,000,000 $30,000,000 $40,000,000 $50,000,000 $60,000,000 $70,000,000 $80,000,000 0-6 months 6-12 months 1-2 years 2-3 years 3-5 years Pending Maturities (excluding overnight and pension portfolio) City of Renton Investment Report Q1 2025 Page 3 Portfolio Performance Against Benchmarks 5 year trend (blended) Period Renton CORE Renton BLENDED SIP Fed Funds Rate 2Y TREAS March 2020 1.85%1.16%1.29%0.65%0.45% June 2020 1.87%0.73%0.37%0.08%0.19% September 2020 1.48%0.62%0.21%0.09%0.13% December 2020 1.30%0.53%0.16%0.09%0.14% March 2021 0.88%0.41%0.11%0.07%0.15% June 2021 0.88%0.41%0.08%0.08%0.20% September 2021 0.84%0.39%0.09%0.08%0.24% December 2021 0.84%0.35%0.09%0.08%0.68% March 2022 0.94%0.45%0.23%0.20%1.91% June 2022 1.16%0.85%1.01%1.21%3.00% September 2022 1.37%1.60%2.56%2.56%3.86% December 2022 1.56%2.33%4.12%4.10%4.29% March 2023 1.91%3.29%4.77%4.65%4.30% June 2023 2.31%3.56%5.20%5.08%4.64% September 2023 2.45%3.67%5.39%5.33%5.02% December 2023 2.72%3.92%5.43%5.33%4.46% March 2024 2.96%4.28%5.41%5.33%4.59% June 2024 3.17%4.31%5.40%5.33%4.74% September 2024 3.27%4.24%5.23%5.13%3.62% December 2024 3.43%3.89%4.60%4.48%4.23% March 2025 3.50%3.85%4.40%4.33%3.97% "Blended" portfolio includes cash and State Investment Pool 0.00% 1.00% 2.00% 3.00% 4.00% 5.00% 6.00% Renton CORE Renton BLENDED SIP Fed Funds Rate 2 Year Treasury Linear (Renton CORE) City of Renton Investment Report Q1 2025 Page 4 Cash Investments by Fund (year over year comparison) Fund Name Cash Investments Total C & I Cash Investments Total C & I % chg GENERAL 111,863,602$ -$ 111,863,602$ 96,558,456$ -$ 96,558,456$ 16% COMMUNITY SERVICES 2,564,976$ -$ 2,564,976$ 1,619,970$ -$ 1,619,970$ 58% STREETS 4,602,893$ -$ 4,602,893$ 4,506,200$ -$ 4,506,200$ 2% MUSEUM 103,923$ -$ 103,923$ 10,981$ -$ 10,981$ 846% ECONOMIC DEVELOPMENT RESERVE 2,814,942$ -$ 2,814,942$ 2,714,135$ -$ 2,714,135$ 4% LEASED CITY PROPERTIES 435,283$ -$ 435,283$ 110,167$ -$ 110,167$ 295% SPECIAL HOTEL-MOTEL TAX 1,247,969$ -$ 1,247,969$ 977,242$ -$ 977,242$ 28% ONE PERCENT FOR ART 132,134$ -$ 132,134$ 102,756$ -$ 102,756$ 29% CABLE COMM DEV FUND 376,830$ -$ 376,830$ 374,469$ -$ 374,469$ 1% HOUSING AND SUPPORTIVE SERVICES 16,412,825$ -$ 16,412,825$ 11,975,377$ -$ 11,975,377$ 37% SPRINGBROOK WETLANDS BANK 727,494$ -$ 727,494$ 717,669$ -$ 717,669$ 1% POLICE SEIZURE 793,375$ -$ 793,375$ 582,907$ -$ 582,907$ 36% POLICE SEIZURE CSAM 132,533$ -$ 132,533$ 131,855$ -$ 131,855$ 1% AFFORDABLE HOUSING DEVELOPMENT 294,785$ -$ 294,785$ -$ -$ -$ 0% GEN GOVT MISC DEBT SERV 5,824,765$ -$ 5,824,765$ 5,448,479$ -$ 5,448,479$ 7% COMMUNITY DEVELOP IMPACT MITIG 441,274$ -$ 441,274$ 732,957$ -$ 732,957$ -40% FIRE IMPACT MITIGATION 11,351$ -$ 11,351$ 11,600$ -$ 11,600$ -2% TRANSPORTATION IMPACT MITIGATION 4,339,265$ -$ 4,339,265$ 2,556,532$ -$ 2,556,532$ 70% REET 1 5,574,725$ -$ 5,574,725$ 2,388,389$ -$ 2,388,389$ 133% REET 2 2,802,639$ -$ 2,802,639$ 3,775,468$ -$ 3,775,468$ -26% RENTON SD IMPACT MITIGATION 12,389$ -$ 12,389$ 28,093$ -$ 28,093$ -56% ISSAQUAH SD IMPACT MITIGATION 14,360$ -$ 14,360$ 85$ -$ 85$ 16774% KENT SD IMPACT MITIGATION -$ -$ -$ -$ -$ -$ 0% MUNICIPAL FACILITIES CIP FUND 27,803,309$ -$ 27,803,309$ 21,574,346$ -$ 21,574,346$ 29% CAPITAL IMPROVEMENT FUND 18,435,615$ -$ 18,435,615$ 14,476,153$ -$ 14,476,153$ 27% FAMILY FIRST CENTER 3,954,143$ -$ 3,954,143$ 3,685,633$ -$ 3,685,633$ 7% General funds 211,717,401$ -$ 211,717,401$ 175,059,916$ -$ 175,059,916$ 21% AIRPORT 8,289,040$ -$ 8,289,040$ 6,103,082$ -$ 6,103,082$ 36% AIRPORT CAPITAL IMPROVEMENT FUND 5,853,379$ -$ 5,853,379$ 5,630,683$ -$ 5,630,683$ 4% Airport funds 14,142,419$ -$ 14,142,419$ 11,733,766$ -$ 11,733,766$ 21% MUNICIPAL GOLF COURSE SYSTEM FUND 1,755,079$ -$ 1,755,079$ 1,649,017$ -$ 1,649,017$ 6% MUNICIPAL GOLF COURSE SYSTEM CIP FUND 662,465$ -$ 662,465$ 439,273$ -$ 439,273$ 51% Golf course funds 2,417,543$ -$ 2,417,543$ 2,088,290$ -$ 2,088,290$ 16% SOLID WASTE UTILITY 5,096,460$ -$ 5,096,460$ 4,501,981$ -$ 4,501,981$ 13% WATER OPERATIONS FUND 18,289,094$ -$ 18,289,094$ 16,003,353$ -$ 16,003,353$ 14% WASTEWATER OPERATIONS FUND 8,843,345$ -$ 8,843,345$ 8,525,626$ -$ 8,525,626$ 4% SURFACE WATER OPERATIONS FUND 14,139,907$ -$ 14,139,907$ 15,722,535$ -$ 15,722,535$ -10% KING COUNTY METRO MITIGATION 7,612,503$ -$ 7,612,503$ 6,481,647$ -$ 6,481,647$ 17% WATER CIP FUND 37,718,059$ -$ 37,718,059$ 37,403,123$ -$ 37,403,123$ 1% WASTEWATER CIP FUND 20,090,092$ -$ 20,090,092$ 18,706,256$ -$ 18,706,256$ 7% SURFACE WATER CIP FUND 13,669,250$ -$ 13,669,250$ 11,637,424$ -$ 11,637,424$ 17% WATER WORKS RATE STABLIZATION 18,472$ -$ 18,472$ 17,811$ -$ 17,811$ 4% Utility funds 125,477,183$ -$ 125,477,183$ 118,999,757$ -$ 118,999,757$ 5% EQUIPMENT RENTAL 19,841,479$ -$ 19,841,479$ 19,163,055$ -$ 19,163,055$ 4% INFORMATION SERVICES 9,847,380$ -$ 9,847,380$ 9,099,378$ -$ 9,099,378$ 8% FACILITIES 2,432,240$ -$ 2,432,240$ 1,413,188$ -$ 1,413,188$ 72% COMMUNCIATIONS 778,441$ -$ 778,441$ 748,908$ -$ 748,908$ 4% INSURANCE FUND 25,585,027$ -$ 25,585,027$ 24,698,768$ -$ 24,698,768$ 4% HEALTH INSURANCE FUND 10,724,612$ -$ 10,724,612$ 9,613,231$ -$ 9,613,231$ 12% LEOFF1 RETIREES HEALTHCARE 20,659,666$ -$ 20,659,666$ 20,383,411$ -$ 20,383,411$ 1% FIREMEN'S PENSION 9,246,078$ 356,701$ 9,602,780$ 8,810,188$ 429,684$ 9,239,872$ 4% SPECIAL DEPOSITS 1,002,377$ -$ 1,002,377$ 1,645,841$ -$ 1,645,841$ -39% Stand alone funds 100,117,301$ 356,701$ 100,474,002$ 95,575,968$ 429,684$ 96,005,652$ 5% CUSTODIAL FUND 997,715$ -$ 997,715$ 961,506$ -$ 961,506$ 4% PAYROLL CLEARING ACCOUNT 266,952$ -$ 266,952$ 215,671$ -$ 215,671$ 24% SURPLUS BANK BALANCE (411,909,433)$ 411,909,433$ -$ (347,209,298)$ 347,209,298$ -$ 0% Accounting only funds (410,644,765)$ 411,909,433$ 1,264,668$ (346,032,121)$ 347,209,298$ 1,177,177$ Grand Total:43,227,082$ 412,266,134$ 455,493,216$ 57,425,576$ 347,638,982$ 405,064,557$ 12% % chg US Treasury 86,961,602$ 21%US Treasury 43,016,769$ 12%102% SIP 212,441,281$ 52%SIP 211,820,277$ 61%0% GSE's 85,478,422$ 21%GSE's 75,605,971$ 22%13% CD's 27,028,128$ 7%CD's 16,766,281$ 5%61% Total 411,909,433$ 90%Total 347,209,298$ 86%19% (of total)(of total) (2025 v 2024) March 31, 2025 Fund 901 Summary Fund 901 Summary March 31, 2024 City of Renton Investment Report Q1 2025 Page 5 Public Deposit Protection Commission (PDPC) Report First Financial Northwest Bank 155,602,287 85,495,727 55%27,028,128 17.37%1.4% $- Total 27,028,128$ Total -$ First Financial Northwest Bank 153,809,552 82,366,439 54%27,028,128 17.57%2.3% $- Total 27,028,128$ Total -$ First Financial Northwest Bank 153,896,487 78,939,469 51%27,028,128 17.56%-7.7% $ 10,261,846 Total 27,028,128$ Total -$ First Financial Northwest Bank 151,767,933 89,435,606 59%16,766,281 11.05%2.7% $- Total 16,766,281$ Total -$ First Financial Northwest Bank 152,263,681 85,762,875 56%16,766,281 11.24%-0.9% $- Total 16,766,281$ Total -$ First Financial Northwest Bank 149,203,757 85,356,316 57%16,766,281 11.24%2.4% $ 83,105 Total 16,766,281$ Total -$ First Financial Northwest Bank 148,370,627 76,088,118 51%16,683,176 11.24%-3.6% $- Total 16,683,176$ Total -$ First Financial Northwest Bank 149,068,764 81,774,740 55%16,683,176 11.19%2.9% $- Total 16,683,176$ Total -$ First Financial Northwest Bank 150,370,315 78,200,502 52%16,683,176 11.09%12.5% $- Total 16,683,176$ Total -$ Commencement Bank 46,493,640 17,076,449 37%- 0.00%5.4% $ (5,000,000) First Financial Northwest Bank 150,370,315 60,954,655 41%16,683,176 11.09%0.9% $- Total 16,683,176$ Total (5,000,000)$ Commencement Bank 46,750,721 16,344,739 35%5,000,000 10.70%35.0% $- First Financial Northwest Bank 148,174,815 60,661,388 41%16,683,176 11.26%1.4% $ 50,631 Total 21,683,176$ Total -$ PDPC Report December 2024 through February 2025 updated through March 14, 2025 CHANGE since last report Depository WA Proportional Net Worth 12/31/2024 Total WA Deposits 2/28/2025 % public (PDPC limit 150%) City of Renton Deposits % of net worth (PDPC limit 100%) % public City of Renton Deposits PDPC Report March 2024 through May 2024 updated through June 14, 2024 CHANGE since last report Depository WA Proportional Net Worth 3/31/2024 Total WA Deposits 05/31/2024 % public (PDPC limit 150%) City of Renton Deposits % of net worth (PDPC limit 100%) % public City of Renton Deposits PDPC Report March 2023 through May 2023 updated through June 14, 2023 CHANGE since last report Depository WA Proportional Net Worth 3/31/2023 Total WA Deposits 5/31/2023 % public (PDPC limit 150%) City of Renton Deposits % of net worth (PDPC limit 100%) % public City of Renton Deposits PDPC Report December 2022 through February 2023 updated through March 20, 2023 CHANGE since last report Depository WA Proportional Net Worth 12/31/2022 Total WA Deposits 2/28/2023 % public (PDPC limit 150%) City of Renton Deposits % of net worth (PDPC limit 100%) % public City of Renton Deposits PDPC Report September 2024 through November 2024 updated through December 16, 2024 CHANGE since last report Depository WA Proportional Net Worth 9/30/2024 Total WA Deposits 11/30/2024 % public (PDPC limit 150%) City of Renton Deposits % of net worth (PDPC limit 100%) % public City of Renton Deposits PDPC Report June 2022 through August 2022 updated through September 21, 2022 CHANGE since last report Depository WA Proportional Net Worth 6/30/2022 Total WA Deposits 8/31/2022 % public (PDPC limit 150%) City of Renton Deposits % of net worth (PDPC limit 100%) % public City of Renton Deposits PDPC Report October 2022 through December 2022 updated through February 7, 2023 CHANGE since last report Depository WA Proportional Net Worth 12/31/2022 Total WA Deposits 12/31/2022 % public (PDPC limit 150%) City of Renton Deposits % of net worth (PDPC limit 100%) % public City of Renton Deposits PDPC Report June 2023 through August 2023 updated through September 18, 2023 CHANGE since last report Depository WA Proportional Net Worth 6/30/2023 Total WA Deposits 8/31/2023 % public (PDPC limit 150%) City of Renton Deposits % of net worth (PDPC limit 100%) % public City of Renton Deposits PDPC Report September 2023 through November 2023 updated through December 18, 2023 CHANGE since last report Depository WA Proportional Net Worth 9/30/2023 Total WA Deposits 11/30/2023 % public (PDPC limit 150%) City of Renton Deposits % of net worth (PDPC limit 100%) % public City of Renton Deposits PDPC Report January 2024 through March 2024 updated through May 8, 2024 CHANGE since last report Depository WA Proportional Net Worth 12/31/2023 Total WA Deposits 12/31/2023 % public (PDPC limit 150%) City of Renton Deposits % of net worth (PDPC limit 100%) % public City of Renton Deposits PDPC Report June 2024 through August 2024 updated through September 16, 2024 CHANGE since last report Depository WA Proportional Net Worth 6/30/2024 Total WA Deposits 8/31/2024 % public (PDPC limit 150%) City of Renton Deposits % of net worth (PDPC limit 100%) % public City of Renton Deposits City of Renton Investment Report Q1 2025 Page 6 City of Renton, WA – RFP for Investment Advisory Services 18 | Page Exhibit D – CITY OF RENTON PROFESSIONAL SERVICES AGREEMENT SAMPLE City of Renton, WA – RFP for Investment Advisory Services 19 | Page AGREEMENT FOR __________________________ THIS AGREEMENT , dated for reference purposes only as ________________, is by and between the City of Renton (the “City”), a Washington municipal corporation, and ____________________ (“Consultant”), _____________________. The City and the Consultant are referred to collectively in this Agreement as the “Parties.” Once fully executed by the Parties, this Agreement is effective as of the last date signed by both parties. 1. Scope of Work : Consultant agrees to provide ________________________________ as specified in Exhibit _____, which is attached and incorporated herein and may hereinafter be referred to as the “Work.” 2. Changes in Scope of Work : The City, without invalidating this Agreement, may order changes to the Work consisting of additions, deletions or modifications. Any such changes to the Work shall be ordered by the City in writing and the Compensation shall be equitably adjusted consistent with the rates set forth in Exhibit ____ or as otherwise mutually agreed by the Parties. 3. Time of Performance: Consultant shall commence performance of the Agreement pursuant to the schedule(s) set forth in Exhibit _____. All Work shall be performed by no later than ________________. 4. Compensation: A. Amount. Total compensation to Consultant for Work provided pursuant to this Agreement shall not exceed $____________, plus any applicable state and local sales taxes. Compensation shall be paid as a flat rate fixed sum based upon Work actually performed according to the rate(s) or amounts specified in Exhibit ____. The Consultant agrees that any hourly or flat rate charged by it for its Work shall remain locked at the negotiated rate(s) unless otherwise agreed to in writing or provided in Exhibit _____. Except as specifically provided herein, the Consultant shall be solely responsible for payment of any taxes imposed as a result of the performance and payment of this Agreement. B. Method of Payment. On a monthly or no less than quarterly basis during any quarter in which Work is performed, the Consultant shall submit a voucher or invoice in a form specified by City of Renton, WA – RFP for Investment Advisory Services 20 | Page the City, including a description of what Work has been performed, the name of the personnel performing such Work, and any hourly labor charge rate for such personnel. The Consultant shall also submit a final bill upon completion of all Work. Payment shall be made by the City for Work performed within thirty (30) calendar days after receipt and approval by the appropriate City representative of the voucher or invoice. If the Consultant’s performance does not meet the requirements of this Agreement, the Consultant will correct or modify its performance to comply with the Agreement. The City may withhold payment for work that does not meet the requirements of this Agreement. C. Effect of Payment. Payment for any part of the Work shall not constitute a waiver by the City of any remedies it may have against the Consultant for failure of the Consultant to perform the Work or for any breach of this Agreement by the Consultant. D. Non-Appropriation of Funds. If sufficient funds are not appropriated or allocated for payment under this Agreement for any future fiscal period, the City shall not be obligated to make payments for Work or amounts incurred after the end of the current fiscal period, and this Agreement will terminate upon the completion of all remaining Work for which funds are allocated. No penalty or expense shall accrue to the City in the event this provision applies. 5. Termination: A. The City reserves the right to terminate this Agreement at any time, with or without cause by giving ten (10) calendar days’ notice to the Consultant in writing. In the event of such termination or suspension, all finished or unfinished documents, data, studies, worksheets, models and reports, or other material prepared by the Consultant pursuant to this Agreement shall be submitted to the City, if any are required as part of the Work. B. In the event this Agreement is terminated by the City, the Consultant shall be entitled to payment for all hours worked to the effective date of termination, less all payments previously made. If the Agreement is terminated by the City after partial performance of Work for which the agreed compensation is a fixed fee, the City shall pay the Consultant an equitable share of the fixed fee. This provision shall not prevent the City from seeking any legal remedies it may have for the violation or nonperformance of any of the provisions of this Agreement and such charges due to the City shall be deducted from the final payment due the Consultant. No payment shall be made by the City for any expenses incurred or work done following the effective date of termination unless authorized in advance in writing by the City. 6. Warranties And Right To Use Work Product: Consultant represents and warrants that Consultant will perform all Work identified in this Agreement in a professional and workmanlike manner and in accordance with all reasonable and professional standards and laws. Compliance with professional standards includes, as applicable, performing the Work in compliance with applicable City standards or guidelines (e.g. design criteria and Standard Plans for Road, Bridge and Municipal Construction). Professional engineers shall certify engineering plans, specifications, plats, and reports, as applicable, pursuant to RCW 18.43.070. Consultant further represents and warrants that all final work product created for and delivered to the City pursuant City of Renton, WA – RFP for Investment Advisory Services 21 | Page to this Agreement shall be the original work of the Consultant and free from any intellectual property encumbrance which would restrict the City from using the work product. Consultant grants to the City a non-exclusive, perpetual right and license to use, reproduce, distribute, adapt, modify, and display all final work product produced pursuant to this Agreement. The City’s or other’s adaptation, modification or use of the final work products other than for the purposes of this Agreement shall be without liability to the Consultant. The provisions of this section shall survive the expiration or termination of this Agreement. 7. Record Maintenance: The Consultant shall maintain accounts and records, which properly reflect all direct and indirect costs expended and Work provided in the performance of this Agreement and retain such records for as long as may be required by applicable Washington State records retention laws, but in any event no less than six years after the termination of this Agreement. The Consultant agrees to provide access to and copies of any records related to this Agreement as required by the City to audit expenditures and charges and/or to comply with the Washington State Public Records Act (Chapter 42.56 RCW). The provisions of this section shall survive the expiration or termination of this Agreement. 8. Public Records Compliance: To the full extent the City determines necessary to comply with the Washington State Public Records Act, Consultant shall make a due diligent search of all records in its possession or control relating to this Agreement and the Work, including, but not limited to, e-mail, correspondence, notes, saved telephone messages, recordings, photos, or drawings and provide them to the City for production. In the event Consultant believes said records need to be protected from disclosure, it may, at Consultant’s own expense, seek judicial protection. Consultant shall indemnify, defend, and hold harmless the City for all costs, including attorneys’ fees, attendant to any claim or litigation related to a Public Records Act request for which Consultant has responsive records and for which Consultant has withheld records or information contained therein, or not provided them to the City in a timely manner. Consultant shall produce for distribution any and all records responsive to the Public Records Act request in a timely manner, unless those records are protected by court order. The provisions of this section shall survive the expiration or termination of this Agreement. 9. Independent Contractor Relationship: A. The Consultant is retained by the City only for the purposes and to the extent set forth in this Agreement. The nature of the relationship between the Consultant and the City during the period of the Work shall be that of an independent contractor, not employee. The Consultant, not the City, shall have the power to control and direct the details, manner or means of Work. Specifically, but not by means of limitation, the Consultant shall have no obligation to work any particular hours or particular schedule, unless otherwise indicated in the Scope of Work or where scheduling of attendance or performance is mutually arranged due to the nature of the Work. Consultant shall retain the right to designate the means of performing the Work covered by this agreement, and the Consultant shall be entitled to employ other workers at such compensation and such other conditions as it may deem proper, provided, however, that any contract so made by the Consultant is to be paid by it alone, and that employing such workers, it is acting individually and not as an agent for the City. City of Renton, WA – RFP for Investment Advisory Services 22 | Page B. The City shall not be responsible for withholding or otherwise deducting federal income tax or Social Security or contributing to the State Industrial Insurance Program, or otherwise assuming the duties of an employer with respect to Consultant or any employee of the Consultant. C. If the Consultant is a sole proprietorship or if this Agreement is with an individual, the Consultant agrees to notify the City and complete any required form if the Consultant retired under a State of Washington retirement system and agrees to indemnify any losses the City may sustain through the Consultant’s failure to do so. 10. Hold Harmless: The Consultant agrees to release, indemnify, defend, and hold harmless the City, elected officials, employees, officers, representatives, and volunteers from any and all claims, demands, actions, suits, causes of action, arbitrations, mediations, proceedings, judgments, awards, injuries, damages, liabilities, taxes, losses, fines, fees, penalties, expenses, attorney’s or attorneys’ fees, costs, and/or litigation expenses to or by any and all persons or entities, arising from, resulting from, or related to the negligent acts, errors or omissions of the Consultant in its performance of this Agreement or a breach of this Agreement by Consultant, except for that portion of the claims caused by the City’s sole negligence. Should a court of competent jurisdiction determine that this agreement is subject to RCW 4.24.115, (Validity of agreement to indemnify against liability for negligence relative to construction, alteration, improvement, etc., of structure or improvement attached to real estate…) then, in the event of liability for damages arising out of bodily injury to persons or damages to property caused by or resulting from the concurrent negligence of the Consultant and the City, its officers, officials, employees and volunteers, Consultant’s liability shall be only to the extent of Consultant’s negligence. It is further specifically and expressly understood that the indemnification provided in this Agreement constitute Consultant’s waiver of immunity under the Industrial Insurance Act, RCW Title 51, solely for the purposes of this indemnification. The Parties have mutually negotiated and agreed to this waiver. The provisions of this section shall survive the expiration or termination of this Agreement. 11. Gifts and Conflicts: The City’s Code of Ethics and Washington State law prohibit City employees from soliciting, accepting, or receiving any gift, gratuity or favor from any person, firm or corporation involved in a contract or transaction. To ensure compliance with the City’s Code of Ethics and state law, the Consultant shall not give a gift of any kind to City employees or officials. Consultant also confirms that Consultant does not have a business interest or a close family relationship with any City officer or employee who was, is, or will be involved in selecting the Consultant, negotiating or administering this Agreement, or evaluating the Consultant’s performance of the Work. City of Renton, WA – RFP for Investment Advisory Services 23 | Page 12. City of Renton Business License: Unless exempted by the Renton Municipal Code, Consultant shall obtain a City of Renton Business License prior to performing any Work and maintain the business license in good standing throughout the term of this agreement with the City. Information regarding acquiring a city business license can be found at: https://www.rentonwa.gov/Tax Information regarding State business licensing requirements can be found at: https://dor.wa.gov/doing-business/register-my-business 13. Insurance: Consultant shall secure and maintain: A. Commercial general liability insurance in the minimum amounts of $1,000,000 for each occurrence/$2,000,000 aggregate for the Term of this Agreement. B. In the event that Work delivered pursuant to this Agreement either directly or indirectly involve or require Professional Services, Professional Liability, Errors and Omissions coverage shall be provided with minimum limits of $1,000,000 per occurrence. "Professional Services", for the purpose of this section, shall mean any Work provided by a licensed professional or Work that requires a professional standard of care. C. Workers’ compensation coverage, as required by the Industrial Insurance laws of the State of Washington, shall also be secured. D. Commercial Automobile Liability for owned, leased, hired or non-owned, leased, hired or non- owned, with minimum limits of $1,000,000 per occurrence combined single limit, if there will be any use of Consultant’s vehicles on the City’s Premises by or on behalf of the City, beyond normal commutes. E. Consultant shall name the City as an Additional Insured on its commercial general liability policy on a non-contributory primary basis. The City’s insurance policies shall not be a source for payment of any Consultant liability, nor shall the maintenance of any insurance required by this Agreement be construed to limit the liability of Consultant to the coverage provided by such insurance or otherwise limit the City’s recourse to any remedy available at law or in equity. F. Subject to the City’s review and acceptance, a certificate of insurance showing the proper endorsements, shall be delivered to the City before performing the Work. G. Consultant shall provide the City with written notice of any policy cancellation, within two (2) business days of their receipt of such notice. 14. Delays: Consultant is not responsible for delays caused by factors beyond the Consultant’s reasonable control. When such delays beyond the Consultant’s reasonable control occur, the City agrees the Consultant is not responsible for damages, nor shall the Consultant be deemed to be in default of the Agreement. City of Renton, WA – RFP for Investment Advisory Services 24 | Page 15. Successors and Assigns: Neither the City nor the Consultant shall assign, transfer or encumber any rights, duties or interests accruing from this Agreement without the written consent of the other. 16. Notices: Any notice required under this Agreement will be in writing, addressed to the appropriate party at the address which appears below (as modified in writing from time to time by such party), and given personally, by registered or certified mail, return receipt requested, by facsimile or by nationally recognized overnight courier service. Time period for notices shall be deemed to have commenced upon the date of receipt, EXCEPT facsimile delivery will be deemed to have commenced on the first business day following transmission. Email and telephone may be used for purposes of administering the Agreement, but should not be used to give any formal notice required by the Agreement. CITY OF RENTON Project Manager Name 1055 South Grady Way Renton, WA 98057 Phone: (425) 430-XXXXXXXX E-mail Address Fax: (425) 430-XXXXXXXX CONSULTANT Project Manager Name Street Address City, State Zip Phone: (XXX) XXX-XXXX E-mail Address Fax: (XXX) XXX-XXXX 17. Discrimination Prohibited: Except to the extent permitted by a bona fide occupational qualification, the Consultant agrees as follows: A. Consultant, and Consultant’s agents, employees, representatives, and volunteers with regard to the Work performed or to be performed under this Agreement, shall not discriminate on the basis of race, color, sex, religion, nationality, creed, marital status, sexual orientation or preference, age (except minimum age and retirement provisions), honorably discharged veteran or military status, or the presence of any sensory, mental or physical handicap, unless based upon a bona fide occupational qualification in relationship to hiring and employment, in employment or application for employment, the administration of the delivery of Work or any other benefits under this Agreement, or procurement of materials or supplies. B. The Consultant will take affirmative action to insure that applicants are employed and that employees are treated during employment without regard to their race, creed, color, national origin, sex, age, sexual orientation, physical, sensory or mental handicaps, or marital status. Such action shall include, but not be limited to the following employment, upgrading, demotion or transfer, recruitment or recruitment advertising, layoff or termination, rates of pay or other forms of compensation and selection for training. C. If the Consultant fails to comply with any of this Agreement’s non-discrimination provisions, the City shall have the right, at its option, to cancel the Agreement in whole or in part. City of Renton, WA – RFP for Investment Advisory Services 25 | Page D. The Consultant is responsible to be aware of and in compliance with all federal, state and local laws and regulations that may affect the satisfactory completion of the project, which includes but is not limited to fair labor laws, worker's compensation, and Title VI of the Federal Civil Rights Act of 1964, and will comply with City of Renton Council Resolution Number 4085. 18. Miscellaneous: The parties hereby acknowledge: A. The City is not responsible to train or provide training for Consultant. B. Consultant will not be reimbursed for job related expenses except to the extent specifically agreed within the attached exhibits. C. Consultant shall furnish all tools and/or materials necessary to perform the Work except to the extent specifically agreed within the attached exhibits. D. In the event special training, licensing, or certification is required for Consultant to provide Work he/she will acquire or maintain such at his/her own expense and, if Consultant employs, sub-contracts, or otherwise assigns the responsibility to perform the Work, said employee/sub-contractor/assignee will acquire and or maintain such training, licensing, or certification. E. This is a non-exclusive agreement and Consultant is free to provide his/her Work to other entities, so long as there is no interruption or interference with the provision of Work called for in this Agreement. F. Consultant is responsible for his/her own insurance, including, but not limited to health insurance. G. Consultant is responsible for his/her own Worker’s Compensation coverage as well as that for any persons employed by the Consultant. 19. Other Provisions: A. Approval Authority. Each individual executing this Agreement on behalf of the City and Consultant represents and warrants that such individuals are duly authorized to execute and deliver this Agreement on behalf of the City or Consultant. B. General Administration and Management. The City’s project manager is ____________________. In providing Work, Consultant shall coordinate with the City’s contract manager or his/her designee. C. Amendment and Modification. This Agreement may be amended only by an instrument in writing, duly executed by both Parties. D. Conflicts. In the event of any inconsistencies between Consultant proposals and this Agreement, the terms of this Agreement shall prevail. Any exhibits/attachments to this Agreement are incorporated by reference only to the extent of the purpose for which they City of Renton, WA – RFP for Investment Advisory Services 26 | Page are referenced within this Agreement. To the extent a Consultant prepared exhibit conflicts with the terms in the body of this Agreement or contains terms that are extraneous to the purpose for which it is referenced, the terms in the body of this Agreement shall prevail and the extraneous terms shall not be incorporated herein. E. Governing Law. This Agreement shall be made in and shall be governed by and interpreted in accordance with the laws of the State of Washington and the City of Renton. Consultant and all of the Consultant’s employees shall perform the Work in accordance with all applicable federal, state, county and city laws, codes and ordinances. F. Joint Drafting Effort. This Agreement shall be considered for all purposes as prepared by the joint efforts of the Parties and shall not be construed against one party or the other as a result of the preparation, substitution, submission or other event of negotiation, drafting or execution. G. Jurisdiction and Venue. Any lawsuit or legal action brought by any party to enforce or interpret this Agreement or any of its terms or covenants shall be brought in the King County Superior Court for the State of Washington at the Maleng Regional Justice Center in Kent, King County, Washington, or its replacement or successor. Consultant hereby expressly consents to the personal and exclusive jurisdiction and venue of such court even if Consultant is a foreign corporation not registered with the State of Washington. H. Severability. A court of competent jurisdiction’s determination that any provision or part of this Agreement is illegal or unenforceable shall not cancel or invalidate the remainder of this Agreement, which shall remain in full force and effect. I. Sole and Entire Agreement. This Agreement contains the entire agreement of the Parties and any representations or understandings, whether oral or written, not incorporated are excluded. J. Time is of the Essence. Time is of the essence of this Agreement and each and all of its provisions in which performance is a factor. Adherence to completion dates set forth in the description of the Work is essential to the Consultant’s performance of this Agreement. K. Third-Party Beneficiaries. Nothing in this Agreement is intended to, nor shall be construed to give any rights or benefits in the Agreement to anyone other than the Parties, and all duties and responsibilities undertaken pursuant to this Agreement will be for the sole and exclusive benefit of the Parties and no one else. L. Binding Effect. The Parties each bind themselves, their partners, successors, assigns, and legal representatives to the other party to this Agreement, and to the partners, successors, assigns, and legal representatives of such other party with respect to all covenants of the Agreement. City of Renton, WA – RFP for Investment Advisory Services 27 | Page M. Waivers. All waivers shall be in writing and signed by the waiving party. Either party’s failure to enforce any provision of this Agreement shall not be a waiver and shall not prevent either the City or Consultant from enforcing that provision or any other provision of this Agreement in the future. Waiver of breach of any provision of this Agreement shall not be deemed to be a waiver of any prior or subsequent breach unless it is expressly waived in writing. N. Counterparts. The Parties may execute this Agreement in any number of counterparts, each of which shall constitute an original, and all of which will together constitute this one Agreement. IN WITNESS WHEREOF , the Parties have voluntarily entered into this Agreement as of the date last signed by the Parties below. CITY OF RENTON By:_____________________________ CONSULTANT By:____________________________ ____________________ _______________ ____________________ _______________ _____________________________ Date _____________________________ Date Attest _____________________________ Jason A. Seth City Clerk Approved as to Legal Form By: __________________________ ___________________ ________________ Contract Template Updated 5/21/2021