Oxnard committee approves delegation of investment authority to CFO over treasurer amid legal dispute, 2-1

The Oxnard City Finance and Governance Committee on May 27 recommended that the City Council adopt a fiscal year 2025–26 investment policy and delegate the city’s investment authority to the City Chief Financial Officer, Javier Chagoyen Lacero, by a 2–1 vote.

The committee approved the recommendation after debate about the legal basis for delegating investment powers away from the elected city treasurer. Committee Member Starr voted no; Committee Member Rodriguez and Chair McArthur voted in favor. The committee’s recommendation will go to full council for final action.

The dispute centered on interpretation of provisions of the California Government Code governing local agency investments. Committee Member Starr questioned whether the code’s language requires that investment authority be delegated to a city treasurer, citing what he described as specific statutory text and saying a different reading would render that specificity meaningless. The city attorney disagreed, saying the code allows the legislative body to delegate investment functions to other qualified officials or to contract for services.

City CFO Javier Chagoyen Lacero told the committee staff recommended the delegation after outside auditors flagged compliance problems with prior practice by the treasurer. The CFO said auditors had reported that the treasurer used a personal email account for investment activity, that periodic reporting requirements were omitted, that some securities purchases were not authorized under the city’s investment policy, and that the city’s investment policy had not been timely renewed for the start of a fiscal year. Chagoyen Lacero said those findings prompted staff to seek delegation to the CFO to ensure legal and policy compliance.

A member of the public who identified himself as a retired budget officer and former intern to the city treasurer urged the committee to retain the treasurer’s responsibilities and expressed concern about separation of duties, potential conflicts, and the appearance of removing an elected officer’s primary duty. Several committee members and city attorneys noted that if the council declines to delegate authority in a future year, the responsibility would revert to the legislative body and that the council could also hire an outside consultant to assist the treasurer.

City staff said the council adopted the same delegation in the prior year for fiscal reasons; staff described last year as the first time the delegation had been made. Staff also warned that failing to have a current approved investment policy and clear delegation could expose the city to compliance risk and potential litigation by third parties.

The committee recorded the motion to recommend adoption of the resolution and delegation; the motion carried 2–1. Committee Member Starr voted no. The committee did not record a named mover or seconder in the transcript.

The item will return to full City Council with the committee recommendation. The staff report and the proposed investment policy referenced California Government Code provisions and a recent court decision discussed in committee; those legal citations and the auditor findings will be part of the council record when the item is considered at the next council meeting.

Questions and requests from committee members during the discussion included whether periodic reviews of external investment pools’ returns and fees should be added to the policy, and whether an outside consultant could be used to assist the treasurer instead of transferring authority. Staff said those are options but recommended delegation to the CFO to bring the city into compliance promptly.