PREPARED BY: ARTURO CASTILLO DATE OF MEETING: 06/02/2025
SUBJECT:
TITLE
CONSIDER ADOPTING RESOLUTIONS OF THE CITY COUNCIL OF THE CITY OF SAN PABLO AUTHORIZING THE CITY MANAGER TO EXECUTE AGREEMENTS TO TRANSFER ADMINISTRATION OF THE CITY'S PENSION AND OPEB IRC SECTION 115 TRUSTS TO SHUSTER ADVISORY GROUP, LLC, TO TRANSFER THE TRUST ASSETS TO CHARLES SCHWAB TRUST BANK, AND TO NAME ALTA TRUST COMPANY AS DIRECTED TRUSTEE
CEQA: This proposed action is not a project as defined by CEQA.
Label
CITY MANAGER RECOMMENDATION
Recommendation
Adopt two (2) Resolutions
BODY
COMPLIANCE STATEMENTS
Continue Best Management Practices, Fiscal Excellence, and Fiscal Transparency is an adopted City Council Priority contained in the adopted Fiscal Year 2025-2027 City Council Priority Workplan, effective April 7, 2025.
RECOMMENDATION:
City staff recommends that the City Council adopt two (2) resolutions authorizing the City Manager to execute agreements to transfer administration of the City's Section 115 Trust for funding pension and OPEB (other post employment benefits) obligations to Shuster Advisory Group, LLC, to transfer the Trust assets to Charles Schwab Trust Bank, and to name Alta Trust Company as Directed Trustee.
BACKGROUND
Assets in an Internal Revenue Code Section 115 Trust are irrevocably committed for the government function specified in the applicable trust agreement. In the City's case, the funds set aside in its Section 115 Trust are dedicated to pre-funding the City's future pension and OPEB obligations. Additionally, monies held in such trusts can be invested in accordance with the rules governing those trusts, which are different than the investment rules for the City's investment portfolio. Investment restrictions that apply to the investment portfolio of a City (set forth in California Government Code Section 53601 et. seq.) do not apply to the assets held in an irrevocable Section 115 Trust, thus allowing for more flexibility in the investment strategy...
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