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Treasurer and district attorney press board on investment authority as supervisors approve first reading
Summary
Board approved first reading of an ordinance to amend county investment policy and remove a prohibition on delegating investment authority to the CFO; Treasurer Sherry Friedenridge urged keeping fiduciary authority with the treasurer and warned of historic oversight concerns, while county staff said the proposed policy would be more restrictive than state law.
The board considered a first-reading ordinance (supplemental 31k) to amend the county codified ordinances on investment authority and to delete an existing prohibition on delegating investment authority to the county’s chief financial officer.
Sherry Friedenridge, speaking in her official capacity as Treasurer-Tax Collector, urged the board to reconsider assuming or delegating investment authority away from the elected treasurer. She said the delegation option was created after Orange County's 1994 bankruptcy to protect public funds and described concerns expressed by pool participants and other agencies about a recent delegation change.
District Attorney Spitzer and other speakers referenced historical cases and the legal standard for board oversight, including earlier litigation that shaped fiduciary duties. County staff and legal counsel said the proposed county investment policy would be more restrictive than state law, impose greater diversification requirements and give the board flexibility to delegate authority to the CFO if desired.
Supervisors asked whether the changes would affect the voluntary pool and how responsibility would be assigned if investments went poorly. County counsel and staff clarified that rescinding voluntary pool participation is possible but that the recommended actions on the table delete a specific prohibition on CFD delegation and adopt a county investment policy; staff emphasized the policy would be conservative and permissive of board oversight.
The board voted to approve first reading and set second reading/adoption for Feb. 25, 2025.
