January 29, 2023

Donalds Hobby

World Finance Reviews

Uribe, Puente question investment policy; Resolution gives finance director oversight

HARLINGEN — The city commission’s new majority is questioning the city’s investment policy that allowed more than $15 million to be moved into certificates of deposit offering low returns on investment.

Earlier this week, Mayor Pro Tem Richard Uribe questioned the policy giving Finance Director Robert Rodriguez the authority to move money into CDs.

Meanwhile, Mayor Chris Boswell said the city commission had passed a resolution giving the finance director the authority to manage the city’s investment program.

During a meeting, Uribe questioned whether the city had changed a policy that had given Dallas-based Hilltop Securities, the city’s financial advisor, oversight over investments.

“Why would we remove Hilltop Securities from that oversight?” he asked during Wednesday’s meeting. “We have a responsibility to make sure we are investing our money in the best possible way.”

Commission’s role in investment decisions

Uribe asked Rodriguez to explain why he moved $3 million into certificates of deposit which already held $2 million.

“That’s a $3 million decision that I was never aware of,” he said. “I don’t think that it ever came before us here in a meeting for us to approve and I thought we were supposed to have that oversight as well.”

In response, City Manager Gabriel Gonzalez said policy doesn’t require officials to request commissioners’ approve investment decisions.

“Normally, we don’t come to the commission for investment decisions,” he told Uribe. “We do that ourselves. But we could change the policy.”

WaterWorks moves $9 million into CDs

Uribe also said the Harlingen WaterWorks System moved about $9 million in CDs getting less than one quarter of 1 percent return on investment.

“The way I read our policy, this transaction goes against our own policy,” Uribe said. “I’d like to get a legal opinion on it from the attorney. I’d like to have somebody look at that to make sure there was no kind of impropriety because that was a whole lot of money.”

“I think we have to use Hilltop Securities or whoever to sign off on it,” he said. “There has to be some kind of checks and balances.”

Rodriguez: Policy grants authority to move money

In response, Rodriguez said the city’s investment policy gives him authority to move the city’s money into CDs.

“As finance director, I think I have the approval to move the money into a CD,” he told Uribe.

“I don’t think it’s required to check with Hilltop. We can move into CDs. Because the interest rate was very good — it was like double — we did move money into there.”

Rodriquez added city officials “never removed (Hilltop Securities) from that oversight. They do our monthly report and they also will direct our investments through a safekeeping account that we have through our depository at Frost Bank.”

Resolution gives finance director investment oversight

Meanwhile, Boswell said commissioners had passed a resolution giving the finance director the authority to manage the city’s investment program.

“Authority to manage the city’s investment program is derived from a resolution of the city commission,” he said, reading from city policy. “The management responsibility for the investment program is hereby delegated to the director of finance, who shall establish procedures for the operation of the investment programs consistent with this investment policy.”

Boswell said commissioners hadn’t made investment decisions.

“I don’t remember any investment decisions coming to the commission,” he added, as he turned to Rodriguez. “We set the guardrails, if you will, in the investment policy for how money should be invested but we delegate that to you as professionals to make these decisions to determine where the best placement of our funds should be.”

In response, Commissioner Frank Puente said he wanted to know when commissioners passed the resolution.

Uribe wants investment timeline

Meanwhile, Uribe requested Anne Burger Entrekin, who serves as Hilltop Securities’ representative, meet with commissioners to respond to questions.

“I want to see the whole timeline of when all this money was moved and how the decision was made, any emails, any type of transaction — how the decision was made that it didn’t even come to this commission,” he told officials.