The Milford City Council voted to adopt an updated city investment policy that expands the permissible allocation to asset-backed securities and lengthens the allowable maximum term for that sector. Lou Vitola, finance staff, presented Resolution 2025-10 and said the update included one substantive change and several technical edits; the key substantive change increases the maximum allocation to asset-backed securities from 10% to 20% of the portfolio and extends that sector's maximum duration from two years to three years.

Vitola said the change aims to give the city’s investment adviser, PFM Asset Management, more flexibility to respond to market conditions while maintaining a high-credit-quality portfolio. Jeff Fasino, the PFM adviser in the meeting, told council the suggested expansion “does not change the risk profile” of the overall portfolio because PFM will continue to select high-quality, liquid asset-backed securities and use portfolio guardrails.

Audit and custodial safeguards: Vitola described oversight safeguards: monthly statements from both the investment adviser and the custodial bank (U.S. Bank), annual auditor review of investment holdings, and council/management signers on accounts. He said the Finance and Audit Committee reviewed the proposed changes before the council meeting.

Public comment and vote: Julie Morris used the public comment period to ask whether routine audits of investments occur; Vitola replied that auditors review investments annually, that custodial statements and adviser statements are reconciled, and that only designated city signers may approve investments. Council moved to adopt the resolution; a council member made a motion and another seconded; the motion passed and the council adopted Resolution 2025-10.

What changed: The policy removes named ratings agencies and instead refers to nationally recognized statistical ratings organizations (NRSROs) in the glossary and raises the permitted asset-backed securities cap to 20% and maximum duration to three years to allow the adviser more options within the city’s high-credit standards.