Resolution 2022-31973RESOLUTION NO. 2022-31973
A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY OF
MIAMI BEACH, FLORIDA, ACCEPTING THE RECOMMENDATION OF THE
CITY MANAGER, PURSUANT TO REQUEST FOR QUALIFICATIONS (RFQ)
2021 -264 -KB INVESTMENT ADVISORY SERVICES; AUTHORIZING THE
ADMINISTRATION TO ENTER INTO NEGOTIATIONS WITH PUBLIC TRUST
ADVISORS LLC, AS THE TOP RANKED PROPOSER; FURTHER, IF THE
ADMINISTRATION IS NOT SUCCESSFUL IN NEGOTIATING AN
AGREEMENT WITH PUBLIC TRUST ADVISORS LLC, AUTHORIZING THE
ADMINISTRATION TO ENTER INTO NEGOTIATIONS WITH PFM ASSET
MANAGEMENT LLC, AS THE SECOND RANKED PROPOSER; FURTHER, IF
THE ADMINISTRATION IS NOT SUCCESSFUL IN NEGOTIATING AN
AGREEMENT WITH PFM ASSET MANAGEMENT LLC, AUTHORIZING THE
ADMINISTRATION TO ENTER INTO NEGOTIATIONS WITH CHANDLER
ASSET MANAGEMENT, INC., AS THE THIRD RANKED PROPOSER;
FURTHER AUTHORIZING THE CITY MANAGER AND CITY CLERK TO
EXECUTE AN AGREEMENT, UPON CONCLUSION OF SUCCESSFUL
NEGOTIATIONS BY THE ADMINISTRATION.
WHEREAS, on September 4, 2015 the City of Miami Beach ("City") executed a three (3)
year agreement for the investment advisory services with Public Trust Advisors, LLC with an
initial expiration date of September 3, 2020; and
WHEREAS, on July 28, 2021, the Mayor and City Commission approved the issuance of
Request for Qualifications (RFQ) 2021 -264 -KB for Investment Advisory Services and the month-
to-month extension of the current agreement with Public Trust Advisors, LLC, until a
replacement agreement is executed; and
WHEREAS, the City received proposals from the following four (4) firms: Public Trust
Advisors LLC ("Public Trust"), PFM Asset Management LLC ("PFM"), Chandler Asset
Management, Inc. ("Chandler"), and Influctec; and
WHEREAS, on November 17, 2021, the Evaluation Committee appointed by the Interim
City Manager convened to consider the proposals received; and
WHEREAS, the Committee members included Richard Ajami, Budget Officer, Office of
Management & Budget; Frank Estevez, Administrator II, Human Resources Department; Vyomie
Greene, Assistant Director, Finance Department; Ronald Starkman, Chair, Audit Committee; and
Allison Williams, Deputy Finance Director, Finance Department; and
WHEREAS, the Committee received an overview of the project, information relative to
the City's Cone of Silence Ordinance and the Government Sunshine Law; and
WHEREAS, the Committee also received general information on the scope of services,
and a copy of each proposal and was further instructed to score and rank each proposal
pursuant to the evaluation criteria established in the RFQ; and
WHEREAS, the evaluation process resulted in the proposers being ranked by the
Evaluation Committee in the following order:
1St Public Trust Advisors LLC
2nd PFM Asset Management LLC
31d Chandler Asset Management, Inc.
WHEREAS, after reviewing all the submissions and the Evaluation Committee process,
the City Manager agrees with the Evaluation Committee and finds Public Trust Advisors LLC to
be the best -qualified firm to provide Investment Advisory Services for the City of Miami Beach.
NOW, THEREFORE, BE IT DULY RESOLVED BY THE MAYOR AND CITY COMMISSION OF
THE CITY OF MIAMI BEACH, FLORIDA, that the Mayor and City Commission hereby accept
the recommendation of the City Manager, pursuant to Request For Qualifications (RFQ) 2021-
264 -KB Investment Advisory Services; authorize the Administration to enter into negotiations
with Public Trust Advisors LLC, as the top ranked proposer; further, if the administration is not
successful in negotiating an agreement with Public Trust Advisors LLC, authorize the
Administration to enter into negotiations with PFM Asset Management LLC, as the second
ranked proposer; further, if the Administration is not successful in negotiating an agreement with
PFM Asset Management LLC, authorize the Administration to enter into negotiations with
Chandler Asset Management, Inc., as the third ranked proposer; further authorize the City
Manager and City Clerk to execute an agreement, upon conclusion of successful negotiations
by the Administration.
PASSED AND ADOPTED this ao
ATTEST:
RAFA L E. G NADO, CITY CLERK
JAN 2 5 2022
day of -7G"yGr! 2022.
DAN GELBER, MAYOR
APPROVED AS TO
FORM & LANGUAGE
& FOR EXECUTION
City Attomey� Date
C7 -Resolutions G
MIAMI BEACH
COMMISSION MEMORANDUM
TO: Honorable Mayor and Members of the City Commission
FROM: Alina T. Hudak, City Manager
DATE: January 20, 2022
SUBJECT.A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY
OF MIAMI BEACH, FLORIDA, ACCEPTING THE RECOMMENDATION OF
THE CITY MANAGER, PURSUANT TO R.7 -QUEST FOR QUALIFICATIONS
(RFQ) 2021 -264 -KB INVESTMENT ADVISORY SERVICES; AUTHORIZING
THE ADMINISTRATION TO ENTER INTO NEGOTIATIONS WITH, PUBLIC
TRUST ADVISORS LLC, AS THE TOP-RANKED PROPOSER; FURTHER,
IF THE ADMINISTRATION IS NOT SUCCESSFUL IN NEGOTIATING AN
AGREEMENT WITH PUBLIC TRUSTADVISORS LLC, AUTHORIZING THE
ADMINISTRATION TO ENTER INTO NEGOTIATIONS WITH PFM ASSET
MANAGEMENT LLC, AS THE SECOND -RANKED PROPOSER; FURTHER,
IF THE ADMINISTRATION IS NOT SUCCESSFUL IN NEGOTIATING AN
AGREEMENT WITH PFM ASSET MANAGEMENT LLC, AUTHORIZING THE
ADMINISTRATION TO ENTER INTO NEGOTIATIONS WITH CHANDLER
ASSET MANAGEMENT, INC., AS THE THIRD -RANKED PROPOSER;
FURTHER AUTHORIZING THE CITY MANAGER AND CITY CLERK TO
EXECUTE AN AGREEMENT, UPON CONCLUSION OF SUCCESSFUL
NEGOTIATIONS BYTHE ADMINISTRATION.
RECOMMENDATION
It is recommended that the Mayor and City Commission approve the Resolution authorizing the
Administration to negotiate with Public Trust Advisors LLC, as the top-ranked proposer, for
investment advisory services. If the Administration is not successful in negotiating an agreement
with the first -ranked proposer, the Resolution requests authorization for the Administration to
negotiate with PFM Asset Management LLC, as the second -ranked proposer. If the
Administration is not successful in negotiating an agreement with the second -ranked proposer,
the Resolution requests authorization for the Administration to negotiate with Chandler Asset
Management, Inc., as the -third ranked proposer. The Resolution also authorizes the City
Manager and City Clerk to execute an Agreement upon conclusion of successful negotiations
by the Administration and the City Attorneys Office.
BACKGROUND/HISTORY
The Finance Department requires an advisor to provide non -discretionary investment services.
Non -discretionary investment services is an arrangement where the selected firm will make
recommendations on investments but does not have authority to complete transactions on the
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City's behalf. Based on the recommendations of the selected firm, the City will ultimately decide
and complete transactions for the selected investments.
The City expects its investment advisor to be highly experienced with non -discretionary funds a
leader and innovator in the management of investments, and able to provide comprehensive
investment advisory services. The firm selected as the investment advisor and its affiliates will
be restricted from selling to the City, or buying from the City, any securities to or from that firm's
own inventory or account. The investment advisor will also be restricted from placing into the
City's portfolio any securities for which it, or an affiliate, is the issuer. Investment advisors will not
provide custodial services or security safekeeping. All City investments, except for swap
agreements must be held in an independent custodial account.
On September 4, 2015, the City of Miami Beach ("City') executed a three (3) year agreement
for the investment advisory services with Public Trust Advisors, LLC. with an initial expiration
date of September 3, 2020. On July 29, 2020, the Commission authorized the extension of the
agreement for an additional one-year period to reduce its operating costs due to the financial
impact that resulted from COV I D 19. During the one (1) year extension, the Finance
Department reassessed the market and determined it was in the best interest of the City to seek
to establish a replacement agreement for non -discretionary investment services at this time. On
July 28, 2021 the City Commission authorized the month-to-month extension of the current
agreement with Public Trust Advisors, LLC, until a replacement agreement is executed.
Through this RFQ, the City has requested proposals from firms qualified to provide the City with
non -discretionary investment advisory services to make recommendations for the Citys
investments and direct the City's investments. The successful firm would recommend the
investment of excess funds in accordance with the City's investment objectives as outlined in
the City of Miami Beach's Investment Policy. The key objectives of the City's investment policy
are safety of capital, sufficient liquidity -to meet requirements and attaining market—average rates
of return. Excess funds are defined as funds not required to meeting short term expenditures of
the City.
ANALYSIS
On July 28, 2021, the Mayor and City Commission approved the issuance of Request for
Qualifications (RFQ) 2021 -264 -KB for Investment Advisory Services. RFQ responses were
due and received on September 22, 2021. The City received proposals from the following four
(4) firms: Public Trust Advisors LLC CPublic Trust°), PFM Asset Management LLC ("PFM"),
Chandler Asset Management, Inc. ("Chandler"), and Influctec.
On October 22, 2021, Influctec notified the City that it would like to withdraw its proposal.
Therefore, the proposal submitted by Influctec was withdrawn from further consideration.
On November 17, 2021, the Evaluation Committee appointed by the Interim City Manager
convened to consider the proposals received. The Committee was comprised of: Richard
Ajami, Budget Officer, Office of Management & Budget; Frank Estevez, Administrator II,
Human Resources Department; Vyomie Greene, Assistant Director, Finance Department;
Ronald Starkman, Chair, Audit Committee; and Allison Williams, Deputy Finance Director,
Finance Department. The Committee was provided an overview of the project, information
relative to the City's Cone of Silence Ordinance and the Government Sunshine Law. The
Committee was also provided with general information on the scope of services and a copy of
each proposal. The Committee was instructed to score and rank each proposal pursuant to the
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evaluation criteria established in the RFQ.
The evaluation process resulted in the proposers being ranked by the Evaluation Committee in
the following order (See Attachment A):
1St ranked — Public Trust Advisors LLC
2nd ranked — PFM Asset Management LLC
3rd ranked — Chandler Asset Management, Inc.
Below is a brief summary of each proposing firm based on the information in each firm's
proposal.
Public Trust Advisors LLC
Public Trust was founded on the principles of developing and maintaining strong relationships
resulting in client needs -focused communication and a holistic approach to the treasury and
investment management function. For more than two decades, Public Trust professionals have
provided investment solutions for public sector clients. These individuals have a long history of
implementing truly customized investment solutions for clients who, like the City, are seeking to
maximize the investment income and return of portfolios . while adhering to the primary
investment objectives of safety and liquidity.
While other firms continue to diversify resources away from public sector investment programs
due to the prolonged low interest rate environment, Public Trust is fully committed to this sector
and 100% of firm resources are dedicated exclusively to the management and investment
advisory services for public funds exclusively. As of June 30, 2021, Public Trust manages
$51.4 billion in assets for 76 public fund and governmental entities with more than 237 individual
portfolios, all of which are domestic fixed income public funds.
As Public Trust's public sector presence continues to grow, it has added significant resources
to continually support clients' needs. Public Trust's goal is to ensure that it continues
strengthening client relationships through consistent communication and unrivaled service. This
includes additional portfolio management and credit professionals at headquarters in Denver,
and advisory and analytical support in its Orlando, Florida office. The City's investment advisory
relationship would continue to be supported by seven Florida -based investment professionals
located in the Orlando office and by more than 25 Denver based professionals, dedicated to the
success of the City's investment program.
Public Trust has been the City's investment advisor since 2015, and the City has been satisfied
with the services provided to date.
PFM Asset Management LLC.
PFM is the marketing name for a group of affiliated companies providing a range of services. All
services are provided through separate agreements with each company. This material is for
general information purposes only and is not intended to provide specific advice or a specific
recommendation.
Investment advisory services are provided by PFM Asset Management LLC which is registered
with the Securities and Exchange Commission ("SEC") under the Investment Advisers Act of
1940. Financial advisory services are provided by PFM Financial Advisors LLC, a registered
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municipal advisor with the SEC and the Municipal Securities Rulemaking Board ("MSRB")
under the Dodd -Frank Act of 2010. Swap advisory services are provided by PFM Swap
Advisors LLC which is registered as a municipal advisor with both the MSRB and SEC under
the Dodd -Frank Act of 2010, and as a commodity trading advisor with the Commodity Futures
Trading Commission. Additional applicable regulatory information is available upon request.
Consulting services are provided through PFM Group Consulting LLC. Institutional purchasing
card services are provided through PFM Financial Services LLC. PFM's financial modeling
platform for strategic forecasting is provided through PFM Solutions LLC. A web -based
platform for municipal bond information is provided through Munite LLC.
For more than 40 years, PFM professionals have helped governmental clients similar to the City
and other institutional investors with the management and advisement of fixed-income portfolios.
Nationally, PFM manages or advises on $145.1 billion in total fixed income assets including
$107.2 billion in discretionary assets under management ("AUM") and $37.9 billion in non -
discretionary assets under advisement (°AUA").1 By leveraging fixed-income dedicated
resources and Florida expertise, we believe the City can broaden its investment program to
safely increase investment earnings.
ChandlerAsset Management, Inc.
Chandler is an SEC -registered investment adviser founded on the tenets of public agency
investing. Chandler has provided comprehensive investment solutions for local governments
across the nation just like the City, who are guided by the objectives of safety, liquidity, and
yield/retum, for over thirty years. Founded by investment officers for public agencies, Chandler
provides access to advice and investment
manager analysis while bringing clients a personalized and local perspective. As of June 30,
2021, Chandler manages $23.6 billion in firm -wide assets, including over $8 billion in assets for
73 cities. Since 1988, Chandler has assisted local governments in fulfilling fiduciary duty to
constituents by providing high quality fixed income portfolios in a prudent investment framework.
Chandler utilizes investment securities and strategies that conform to the City's investment
policy, applicable federal laws, and Florida Statutes regarding qualified investments for public
entities.
Chandler focus is on separately managed accounts. Chandler does not manage local
government investment pools, therefore dedicating 100% of its resources to managing
individual clients' portfolios and providing customization, transparency, and flexibility through the
ownership of individually owned securities. Chandler firm assets under management reflect
investment strategies for portfolios similar to the services requested in the RFP and do not
include assets in advisory -only accounts, local govemment investment pools, and brokered CDs
products that some firms include in assets under management.
SUPPORTING SURVEY DATA
Not Applicable.
FINANCIAL INFORMATION
The costs of the related services are not a budgeted expense. Investment advisory service fees
are currently netted against investment interest revenue.
Page 237 of 1313
CONCLUSION
After reviewing all of the submissions and the Evaluation Committee process, I concur with the
Evaluation Committee and find Public Trust Advisors LLC the best -qualified firm to provide
Investment Advisory Services for the City of Miami Beach. Public Trust has vast experience in
investment advisory services with government entities such as City of Hollywood, City of Tampa,
City of West Palm Beach, and City of Daytona Beach. As the City's current investment advisor,
Public Trust has provided reliable service that meets the City's investment policy.
PFM and Chandler are also well-qualified firms that should be considered in the event that
negotiations with Public Trust are unsuccessful.
For the reasons stated herein, I recommend that the Mayor and City Commission approve the
Resolution authorizing the Administration to enter into negotiations with Public Trust Advisors
LLC, as the top-ranked proposer, and, if the Administration is not successful in negotiating an
agreement with Public Trust Advisors LLC, authorizing the Administration to enter into
negotiations with PFM Asset Management LLC, as the second -ranked proposer, and, if the
Administration is not successful in negotiating an agreement with PFM Asset Management
LLC, authorizing the Administration to enter into negotiations with Chandler Asset Management,
Inc., as the third -ranked proposer; further authorizing the City Manager and City Clerk to execute
an agreement, upon conclusion of successful negotiations by the Administration.
Applicable Area
Not Applicable
Is this a "Residents Right
to Know" item.pursuant to
City Code Section 2-14?
No
Legislative Tracking
Finance/Procurement
ATTACHMENTS:
Description
❑ Attachment A
❑ Resolution
Does this item utilize G.O.
Bond Funds?
No
Page 238 of 1313
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Page 239 of 1313