Item - 2017.EX23.2

Tracking Status

  • City Council adopted this item on March 28, 2017 without amendments.
  • This item was considered by the Executive Committee on March 7, 2017 and adopted without amendment. It will be considered by City Council on March 28, 2017.
  • See also By-law 587-2017

EX23.2 - Establishment of an Investment Board

Decision Type:
ACTION
Status:
Adopted
Wards:
All

City Council Decision

City Council on March 28 and 29, 2017, adopted the following:

 

1.  City Council establish an Investment Board and delegate its authority to the Board to manage and oversee the City's investments of funds not immediately required by the City, as is required by Regulation 610/06, Financial Activities, under the City of Toronto Act, 2006 and pursuant to the governance structure outlined in Attachment 1 to the report (February 21, 2017) from the City Manager and the Deputy City Manager and Chief Financial Officer.

 

2.  City Council direct that a separate Toronto Municipal Code Chapter be established for the Investment Board substantially as provided for in Attachment 1 to the report (February 21, 2017) from the City Manager and the Deputy City Manager and Chief Financial Officer, and authorize the City Solicitor to bring forward the necessary bills.

 

3.  City Council authorize the City Clerk to initiate a recruitment process for Investment Board members for review by the Facilities and Finance Nominating Panel for recommendation of appointment by City Council.

 

4.  City Council direct the City Clerk to provide secretariat support to the Investment Board.

 

5.  City Council direct the Deputy City Manager and Chief Financial Officer to support the implementation and ongoing maintenance of the Investment Board.

 

6.  City Council approve an interim 2017 budget of $557,500 for the Investment Board as detailed in Attachment 2 to the report (February 21, 2017) from the City Manager and the Deputy City Manager and Chief Financial Officer, and funded from non-program investment income.

 

7.  City Council request the Integrity Commissioner to review the Code of Conduct for Local Boards and recommend any required amendments to the Code of Conduct for the Investment Board given its fiduciary responsibilities.

 

8.  City Council dissolve the Independent Investment Advisory Committee effective December 31, 2017.

Background Information (Committee)

(February 21, 2017) Report from the City Manager and the Deputy City Manager and Chief Financial Officer on Establishment of an Investment Board
https://www.toronto.ca/legdocs/mmis/2017/ex/bgrd/backgroundfile-101438.pdf
Attachment 1 - Governance Structure of the Investment Board
https://www.toronto.ca/legdocs/mmis/2017/ex/bgrd/backgroundfile-101512.pdf
Attachment 2 - 2017 Interim Budget
https://www.toronto.ca/legdocs/mmis/2017/ex/bgrd/backgroundfile-101513.pdf

Motions (City Council)

1 - Motion to Refer Item moved by Councillor Janet Davis (Lost)

That City Council refer the Item back to Executive Committee for consideration at the same time as the proposed Investment Policy.

Vote (Refer Item) Mar-29-2017 4:29 PM

Result: Lost Majority Required - EX23.2 - Davis - motion 1 - Refer the item
Total members that voted Yes: 9 Members that voted Yes are Maria Augimeri, Janet Davis, Sarah Doucette, Paula Fletcher, Mary Fragedakis, Mike Layton, Gord Perks, Anthony Perruzza, Neethan Shan
Total members that voted No: 30 Members that voted No are Paul Ainslie, Ana Bail„o, Jon Burnside, John Campbell, Christin Carmichael Greb, Josh Colle, Gary Crawford, Joe Cressy, Glenn De Baeremaeker, Justin J. Di Ciano, Frank Di Giorgio, John Filion, Michael Ford, Mark Grimes, Stephen Holyday, Jim Karygiannis, Chin Lee, Giorgio Mammoliti, Josh Matlow, Pam McConnell, Mary-Margaret McMahon, Joe Mihevc, Denzil Minnan-Wong, Frances Nunziata (Chair), Cesar Palacio, James Pasternak, Jaye Robinson, David Shiner, Michael Thompson, John Tory
Total members that were Absent: 6 Members that were absent are Shelley Carroll, Vincent Crisanti, Michelle Holland, Norman Kelly, Ron Moeser, Kristyn Wong-Tam

Motion to Adopt Item (Carried)

EX23.2 - Establishment of an Investment Board

Decision Type:
ACTION
Status:
Adopted
Wards:
All

Committee Recommendations

The Executive Committee recommends that:

 

1.  City Council establish an Investment Board and delegate its authority to the Board to manage and oversee the City's investments of funds not immediately required by the City, as is required by Regulation 610/06, Financial Activities, under the City of Toronto Act, 2006 and pursuant to the governance structure outlined in Attachment 1 to the report (February 21, 2017) from the City Manager and the Deputy City Manager and Chief Financial Officer.

 

2.  City Council direct that a separate Toronto Municipal Code Chapter be established for the Investment Board substantially as provided for in Attachment 1 to the report (February 21, 2017) from the City Manager and the Deputy City Manager and Chief Financial Officer, and authorize the City Solicitor to bring forward the necessary bills.

 

3.  City Council authorize the City Clerk to initiate a recruitment process for Investment Board members for review by the Facilities and Finance Nominating Panel for recommendation of appointment by City Council.

 

4.  City Council direct the City Clerk to provide secretariat support to the Investment Board.

 

5.  City Council direct the Deputy City Manager and Chief Financial Officer to support the implementation and ongoing maintenance of the Investment Board.

 

6.  City Council approve an interim 2017 budget of $557,500 for the Investment Board as detailed in Attachment 2 to the report (February 21, 2017) from the City Manager and the Deputy City Manager and Chief Financial Officer, and funded from non-program investment income.

 

7.  City Council request the Integrity Commissioner to review the Code of Conduct for Local Boards and recommend any required amendments to the Code of Conduct for the Investment Board given its fiduciary responsibilities.

 

8.  City Council dissolve the Independent Investment Advisory Committee effective December 31, 2017.

Origin

(February 21, 2017) Report from the City Manager and the Deputy City Manager and Chief Financial Officer

Summary

This report recommends that City Council establish an Investment Board (the Board) to manage and invest City funds which are not immediately required, pursuant to Regulation 610/06, Financial Activities, of the City of Toronto Act, 2006. This Regulation comes into force on January 1, 2018 and introduces much greater flexibility with the City's investment powers but prescribes that City Council must exercise this expanded authority through a City Investment Board.

 

The Board is required to exercise its investment authorities pursuant to the prudent investor standard and in compliance with an Investment Policy approved by City Council. The prudent investor standard sets parameters for those entrusted with the responsibility of managing others' money, and requires that they weigh risk versus reward when making investment decisions, taking into account the income that may be generated by the investment as well as the probable safety of the invested capital.

 

This report recommends the governance structure for the Investment Board including mandate and responsibilities, composition and eligibility, qualifications of members and Chair, remuneration, term and appointment process and accountability and reporting.

 

Lastly, the dissolution of the Independent Investment Advisory Committee, established in April 2011 to advise the Deputy City Manager and Chief Financial Officer on portfolio strategies and governance issues for the City's investment portfolios, is recommended as the Investment Board will now have responsibility for managing and investing the City's portfolios.

Background Information

(February 21, 2017) Report from the City Manager and the Deputy City Manager and Chief Financial Officer on Establishment of an Investment Board
https://www.toronto.ca/legdocs/mmis/2017/ex/bgrd/backgroundfile-101438.pdf
Attachment 1 - Governance Structure of the Investment Board
https://www.toronto.ca/legdocs/mmis/2017/ex/bgrd/backgroundfile-101512.pdf
Attachment 2 - 2017 Interim Budget
https://www.toronto.ca/legdocs/mmis/2017/ex/bgrd/backgroundfile-101513.pdf

Speakers

Derek Moran

Motions

1 - Motion to Adopt Item moved by Mayor John Tory (Carried)
Source: Toronto City Clerk at www.toronto.ca/council