North Battleford City Hall hopes to add to the city's cash reserves by developing a prudent investment portfolio to help increase its funds.
The city selected RBC Wealth Management Dominion Securities for the project to provide investment services for a five-year term, from May 2018 to April 2023, to develop an Institutional investment policy.
Mayor Ryan Bater said at council's meeting Monday that issue was previously brought forward during budget planning.
"The idea for this was developed during deliberations for 2018," Bater said following council. "The first request for proposals was issued back in late November. So we've been developing this for months."
Bater said the process of developing investments happens in other municipalities across Canada, so it's nothing new.
"A number of cities in Saskatchewan are exploring this option," he added. "We are not the first. I suspect there will be many other cities that follow suit. We are in the middle of a time when municipalities need to look out-of-the-box for additional revenue in order to fund necessary programs and services."
The mayor believes this effort might also help alleviate some of the pressure from provincial cutbacks.
"That's what really created this desire to look at alternative revenue sources is dealing with that crisis last year," Bater added.
The exact particulars of the city's investment portfolio will be developed in the future with the city's financial advisor. Once completed, the city's finance team will monitor it monthly, with council reviewing the portfolio each quarter.
"In the policy we developed, council is aiming for an average rate of return of four per cent," Bater added.
Bater said the city reviewed many proposals before deciding on RBC Dominion Securities, which also has an office in North Battleford.
The company that provided the "highest-rated response" on its institutional investing request for proposals was RBC Wealth Management Dominion Securities — Brendon Boothman and Jerrod Schaefer," said outgoing city manager Jim Puffalt when he recommended the Institutional Investment Policy on April 23.
Bater said it can help grow the city's reserves.
"The city has cash reserves. We've had cash reserves for decades, which is used to form the capital plan and capital planning of the city government," Bater said. "Those reserves have been sitting in a bank account. And, after tonight, adopting a policy and adopting a resolution to transfer some of those funds to an investment advisor, we will now start using those reserves to generate additional revenue for the city."
He said while there are risks with any type of investing, council's policy was based on low-risk investments and ensuring a consistent level of return for the taxpayers of North Battleford. Again, he added it would be monitored closely on an ongoing basis.
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