DEPARTMENT: Finance
FILE TYPE: Consent Action
TITLE
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Authorization To Execute Contract Extension For Investment Portfolio Management
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PURPOSE/ACTION REQUESTED
Authorize the Deputy County Manager to execute contract extension with PTMA Asset Management, LLC (PTMA) for external investment portfolio management.
SUMMARY
Prudent management of public funds on behalf of the citizens of Dakota County is a County Board objective. Funds shall be invested in accordance with Minn. Stat. § 118A and County Policy 2254 to ensure safety, liquidity, and yield of the County’s financial assets. Minn. Stat. § 118A.04 provides a list of types of securities in which local governments may invest public funds. Unrestricted public funds are limited to the securities available in the bond market and commercial paper that are fully insured by the Federal Deposit Insurance Corporation. The portfolio will be actively managed to achieve growth of capital through appreciation of securities held and reinvestment of interest income.
Currently, the County utilizes three separate external investment partners for investment portfolio management. The current contracts are set to expire on December 31, 2025, with the option to extend individual contract for three one-year extensions. Staff recommend streamlining all external investment management responsibilities by consolidating them under PTMA, a single strategic partner. PTMA was chosen because it was the most cost-effective option and was successfully meeting its investment benchmark measures. The consolidation will allow Finance to streamline administrative oversight and reduce the complexity of compliance and reporting requirements. The consolidation also provides a more favorable unified fee structure. The consolidation of investment portfolio managers to a single manager is anticipated to save the County approximately $60,000 in management fees annually.
This contract extension will provide investment portfolio management services to Dakota County’s portfolio which will cost an estimated $116,000 annually. This cost will vary based on the value of the County’s portfolio throughout the year and PTMA’s fee schedule.
RECOMMENDATION
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Staff recommend the Board authorize the Deputy County Manager to execute the option to extend the contract with PTMA for investment management services for the period of January 1, 2026, through December 31, 2026. Total expense will be based on the County’s portfolio value according to PTMA’s proposed fee schedule.
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EXPLANATION OF FISCAL/FTE IMPACTS
This contract extension is funded by levy and will be included in the County Manager’s 2026 Recommended Budget.
☐ None ☐ Current budget ☒ Other
☐ Amendment Requested ☐ New FTE(s) requested
RESOLUTION
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WHEREAS, the prudent management of County public funds is a key Board objective, requiring adherence to Minn. Stat. § 118A and County Policy 2254; and
WHEREAS, the County's current external investment management contracts are set to expire on December 31, 2025, with the option for one-year extensions; and
WHEREAS, staff recommends consolidating external investment management responsibilities under a single partner, PTMA Asset Management, LLC, to streamline oversight, simplify compliance, and secure a more favorable fee structure; and
WHEREAS, the Deputy County Manager seeks authorization to execute a one-year contract extension with PTMA Asset Management, LLC to facilitate this consolidated investment strategy; and
WHEREAS, the cost for this extension is allocated within the County Manager’s 2026 Recommended Budget.
NOW, THEREFORE, BE IT RESOLVED that the County Board hereby authorizes the Deputy County Manager to execute the option to extend the contract with PTMA Asset Management, LLC for external investment portfolio management services for the period of January 1, 2026, through December 31, 2026, with the cost based on the County's portfolio value per PTMA's fee schedule.
PREVIOUS BOARD ACTION
22-551; 12/13/22
ATTACHMENTS
Attachment: None
BOARD GOALS
☐ Thriving People ☐ A Healthy Environment with Quality Natural Resources
☐ A Successful Place for Business and Jobs ☒ Excellence in Public Service
CONTACT
Department Head: Will Wallo
Author: Kristen Zimmerman