Board approves minor reserve‑policy amendment to include unencumbered investments in days‑cash calculation

The board voted to adopt a technical amendment to San Diego Community Power’s financial reserves policy to clarify that unencumbered investments may be included in the agency’s days‑cash‑on‑hand calculation.

Senior Strategic Finance Manager Deb Spangler presented the proposed third revision to the reserves policy, saying the change reflects the agency’s plan to use short‑term investments such as the Local Agency Investment Fund (LAIF) as part of liquidity management. Under the proposed language, investments that are not legally encumbered or earmarked for specific purposes would be included in the days‑cash‑on‑hand metric.

Why it matters Spangler told the board the reserves policy establishes the agency’s target metric (historically stated as a days‑cash‑on‑hand target) and that prior versions had counted only unrestricted cash and cash equivalents, excluding investments. The amendment clarifies that unencumbered, liquid investments can be counted when calculating the agency’s liquidity target.

Board discussion Directors asked whether including investments would change the timing of hitting the policy target. Spangler said the amendment itself does not change the target level; staff are concurrently conducting a risk analysis and a broader policy review and expect to return in Q1 2026 with a comprehensive update. He also said LAIF‑style investments are generally liquid and can be used for operating purposes.

Vote and outcome A motion to adopt Resolution No. 2025‑20 passed on roll call; the board chair announced “Motion carries.”

Ending Staff said the change is a limited, clarifying update and that additional analysis on the appropriate reserve target will follow in early 2026.