AGENDA ITEM
TO: HONORABLE MAYOR
AND MEMBERS OF THE CITY COUNCIL
FROM: CARLO TOMAINO
CITY MANAGER
BY: SIAMLU COX
ADMINISTRATIVE SERVICES OFFICER/FINANCE DIRECTOR
DAVID CASTRO
MANAGEMENT ANALYST
SUBJECT: AWARD OF CONTRACT TO CHANDLER ASSET MANAGEMENT INCORPORATED FOR INVESTMENT MANAGEMENT AND ADVISORY SERVICES
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Summary:
Staff issued a Request for Proposals to support the City’s continued diversification of its investment portfolio, enhance professional oversight, and provide active portfolio management while maintaining safety of principal, liquidity, and compliance as the City’s primary investment objectives. Based on the evaluation of proposals and interviews, staff determined that Chandler Asset Management Incorporated is the most qualified firm to meet the City’s needs. Staff recommends the City Council approve the award of contract and authorize the City Manager to execute the agreement.
The City Council will consider awarding a contract for Investment Management and Advisory Services to Chandler Asset Management Incorporated. The selected firm would provide professional investment advisory services for a designated portion of the City’s investment portfolio in accordance with California Government Code, the City’s Statement of Investment Policy, and California Debt and Investment Advisory Commission reporting requirements.
Strategic Plan Goal(s):
Goal No. 1 Financial Stability: Ensure the City’s long-term financial stability and resilience.
Goal No. 5 High-Functioning Government: Strengthen internal communication, recruitment, retention, systems, and processes to increase the effectiveness and efficiency of City services.
recommendation
Recommendation:
1. Award the contract for Investment Management and Advisory Services to Chandler Asset Management Incorporated.
2. Authorize the City Manager to execute the Professional Services Agreement in a form approved by the City Attorney.
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Fiscal Impact:
The cost for investment management and advisory services will be based on a fee structure proposed by Chandler Asset Management Incorporated, typically calculated as a percentage of assets under management. The total cost will depend on the portion of the portfolio managed and prevailing market conditions. Staff evaluated proposed fees as part of the RFP process and determined the recommended firm’s fee structure is competitive and reasonable relative to services provided. Staff will monitor performance on an ongoing basis and evaluate it against benchmarks and historical returns to ensure the advisory engagement delivers measurable value relative to its cost. Sufficient funds are available within existing appropriations to support this contract.
Background:
The City of Signal Hill manages an investment portfolio of approximately $100 million, investing in both short and long-term instruments to preserve safety, maintain liquidity, and maximize yield. Historically, the City has relied on Wells Fargo Bank for core treasury management, commercial card programs, and safekeeping services under a Master Service Agreement. Currently, the City maintains a safekeeping account with Wells Fargo Bank and purchases government securities and certificates of deposit. While these banking services remain essential for daily operations, the City’s investment strategy has primarily utilized State-managed investment pools, including the State’s Local Agency Investment Fund (LAIF), the California Asset Management Program (CAMP), California Fixed Income Trust (CalFIT) investment pool, and the California Liquid Asset Securities System (CLASS), to maintain stability and preserve capital. The City’s proactive efforts to make sound investments have further diversified the City’s revenues, which is a fundamental goal to sustain City operations.
Analysis:
As the City’s portfolio continues to grow in scope and complexity, staff explored the potential of engaging a professional investment advisor to actively manage a designated portion of the portfolio while maintaining strict adherence to the California Government Code and the City’s Statement of Investment Policy. On February 24, 2026, the City Council authorized the release of an RFP for Investment Management and Advisory Services to solicit qualified firms capable of providing discretionary advisory services consistent with these objectives. Engaging an experienced advisor enables the City to effectively steward public funds, support long-term fiscal stability, and optimize investment returns.
Professional investment advisory firms provide dedicated, day-to-day management of the City’s portfolio, continuously monitoring financial markets and economic developments. This allows a professional management firm to respond proactively to rapidly changing conditions and emerging risks. Unlike City staff, who must balance multiple responsibilities and cannot devote focused attention to daily portfolio oversight, advisory firms ensure the City’s investments are adjusted in real time based on expert analysis and informed projections.
Investment advisors also have access to a wide range of data sources and market intelligence, far beyond what is typically available to City staff. This enables them to identify trends, risks, and opportunities-such as potential impacts from global events like an Iranian conflict-before these affect the City’s portfolio. By drawing on this comprehensive information, advisors can recommend timely and strategic decisions to optimize performance, protect principal, and maintain compliance with all regulatory requirements. By partnering with a professional advisor, the City gains expert, continuous management and advanced market insight, ensuring the portfolio is well positioned to meet both immediate and future financial objectives.
The City advertised RFP through PlanetBids and received proposals from qualified investment advisory firms by the established deadline. Staff conducted a thorough evaluation based on the following criteria as a basis for evaluation of the proposals and the award recommendation:
1. Understanding of the City's overall investment program, investment objectives and unique constraints.
2. Magnitude of exceptions to the City's standard professional services agreement, including insurance requirements.
3. Experience, resources, and qualifications of the Firm and individuals assigned to the account.
4. Experience of the Firm in managing state/local government portfolios. In evaluating the Firm's experience, past performance data will be evaluated in the context of portfolio objectives and constraints, as well as risks.
5. Recommended approach to management of the portfolio.
6. Fees.
7. The respondent's understanding of the scope of services required includes demonstrated abilities to coordinate delivery of the services and understanding of the needs and operational requirements of the City.
The City received seven proposals; firms were removed from consideration for interviews if they failed to provide required information, lacked experience with California cities, or proposed the highest costs for $100 million portfolios.
VENDOR FEE COMPARISON BY PORTFOLIO SIZE
|
Vendor |
State |
Annual cost @ $10,000,000 |
Annual cost @ $25,000,000 |
Annual cost @ $50,000,000 |
Annual cost @ $100,000,000 |
|
Academy Asset Management, LLC |
CA |
15,000 |
25,000 |
45,000 |
75,000 |
|
Chandler Asset Management Inc |
CA |
9,000 |
22,500 |
45,000 |
75,000 |
|
Clearwater Advisors LLC |
ID |
9,000 |
22,500 |
45,000 |
50,000 |
|
Garcia Hamilton & Associates, L.P. |
TX |
10,000 |
25,000 |
45,000 |
80,000 |
|
Meeder Public Funds, Inc. |
OH |
10,000 |
25,000 |
45,000 |
75,000 |
|
Optimized Investment Partners, LLC |
CA |
6,000 |
15,000 |
30,000 |
60,000 |
|
Public Trust Advisors, LLC |
CO |
25,000 |
25,000 |
37,500 |
70,000 |
After a comprehensive review and interviews, Chandler Asset Management Incorporated stood out for its exceptional qualifications and alignment with the City’s investment objectives. As a California-based firm with local staff familiar with municipal needs, Chandler offered innovative and effective ideas to enhance the City’s portfolio. The firm provided clear and relevant report examples and addressed all RFP requirements with a high degree of competence and professionalism. The firm’s proposal demonstrated a deep understanding of public-sector investment constraints and the importance of maintaining safety and liquidity while strategically positioning the portfolio to optimize returns. Chandler’s ability to deliver impactful advisory services, paired with competitive fees across all portfolio sizes, is the reason staff recommends awarding the contract to Chandler Asset Management Incorporated.
Under the proposed agreement, the selected firm would provide discretionary management of a designated portion of the City’s investment portfolio, conduct ongoing credit and market analysis, actively manage maturity and liquidity positioning, and provide monthly and quarterly reports in compliance with California Debt and Investment Advisory Commission standards. Awarding this contract supports the City’s continued efforts to strengthen investment oversight, enhance portfolio performance within established constraints, and sustain a prudent level of investment earnings over time.
Conclusion:
Staff recommends the City Council award the contract for Investment Management and Advisory Services to Chandler Asset Management Incorporated. This investment in professional services represents a strategic enhancement of the City’s investment oversight framework and supports the City’s commitment to prudent financial management, diversification, and long-term fiscal sustainability.
Reviewed for Fiscal Impact:
_________________________
Siamlu Cox
Administrative Services Officer/Finance Director
Attachments:
A. Investment Management and Advisory Services - Request for Proposal
B. Chandler Asset Management Incorporated Proposal
C. City Of Signal Hill - Professional Services Agreement for Investment Management and Advisory Services