Council updates investment policy, approves Wells Fargo master agreement for banking services
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Summary
Council approved revisions to the town’s investment policy to expand allowable instruments under ARS and later authorized a master agreement with Wells Fargo for banking and merchant services; the council discussed portfolio size and external management options and voted both measures into effect.
On Oct. 7 the Cave Creek Town Council approved two finance items: updated investment policy language (Resolution R2024-13) that expands authorized securities consistent with Arizona Revised Statutes, and authorization for the town manager to execute a master agreement with Wells Fargo Bank for banking and merchant services.
Finance Director Sherry White told council the proposed investment‑policy revisions broadened permissible holdings (for example, certificates of deposit, repurchase agreements, obligations guaranteed by the U.S. government, commercial paper with prime quality, and short‑term bonds) and introduced portfolio controls such as a five‑year maximum maturity, issuer diversification limits (no more than 5% per single issuer), liquidity and credit‑risk mitigation language, and reporting and review procedures. The revisions align the town’s policy with Government Finance Officers Association best practices and enable use of sweep accounts and external managers if the town chooses.
White said the town’s portfolio was “a little over $35,000,000,” and that the policy change is intended to give the town more options to manage yield while preserving safety and liquidity. Council members discussed the possibility of delegating to an external manager versus doing the work in‑house; one council member expressed concern about outsourcing investment management without a town CFO in place.
Council then heard a presentation from Wells Fargo representatives – Stephanie Jordan Slider (relationship manager), Adrian Henriques (treasury management consultant) and Brian McFadden (e‑receivables consultant) – who outlined services not currently available from the town’s incumbent bank: a money‑market sweep (to earn higher returns on idle cash), positive pay fraud controls, desktop deposit, ACH vendor payments, eBill/eBox electronic payment processing, p‑card (purchase card) programs with revenue share, lockbox and receivables manager functionality, and onboarding and implementation timing.
White recommended the town use a money‑market sweep without a peg (to maximize interest earnings) and presented a three‑year pricing commitment for Wells Fargo services. Council discussed expected staff efficiency gains and asked about procurement history; staff said the town code treats banking as a professional service and does not require an RFP. After discussion, council approved the resolution updating investment policy by roll call (6–1) and subsequently authorized the town manager to enter the Wells Fargo master agreement (roll call vote 7–0).
Council members said they expected increased returns to support town services and thanked staff for the work on both items.