SR 01-10-2017 3F
Ci ty Council
Report
City Council Meeting : January 10, 2017
Agenda Item: 3.F
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To: Mayor and City Council
From: Gigi Decavalles -Hughes, Director , Finance Department, Treasury
Subject: Authorization to Continue with the Bloomberg Finance L.P. Agreement for
Investment Related Services
Recommended Action
Staff recommends that the Cit y Council authorize the City Manager to continue
Agreement No.1948 with Bloomberg Financial L.P., a New York -based company , to
provide subscription services for its real -time electronic investment and financial market
information and investment trade order management system for a period of five years
with an option to extend the authorization for an additional five years. This
recommendation is made as an exception to the competitive bidding process pursuant
to Section 2.24.080(d) and is for a total estima ted amount of $273,000 with future year
funding contingent on Council budget approval. The current annual payments for the
subscription services are approximately $26,000 per year with biennial adjustments
based on Bloomberg’s prevailing rates.
Execu tive Summary
Bloomberg Finance, L.P.’s proprietary investment software system is the primary
system used by the investment industry to access real -time information covering
financial markets, economic news, and current events. It also provides analytical t ools
to value investment opportunities and model portfolio performance. The City has used
this system since 2009 to monitor existing investments and make investment decisions
on its approximately $685 million portfolio . Staff re quests Council authority to continue
this agreement in an amount beyond the City Manager’s authority threshold of
$175,000 . The recommended contract of five years with a five -year renewal period
would result in approximately $273,000 in additional expenditures for a total estimated
contract amount of $439,130.
Background
The City’s investment portfolio is approximately $685 million with approximately 196
security holdings. Investments are made in accordance with California State
Government Code Section 53601 et. al. and the City’s I nvestment Policy. They include
fixed -income investments like Federal Agency securities, U.S. Treasury bills and notes,
Supranationals issued by the World Bank and related entities, Municipal Bonds, and
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Corporate Bonds. The City’s investment objectives ar e to ensure the safety of funds,
maintain liquidity to meet the City’s cash flow needs, and earn a market rate of return
after the objectives of safety and liquidity have been met.
Bloomberg is a subscription service that enables finance and investment pr ofessionals
to monitor and analyze real -time financial market and economic data. The information is
used in investment portfolio analyses, investment decision making, and monitoring
changes in interest rates and bond credit ratings. It also has the capabil ity to process
investment trades via its electronic trading platform, and provides news and
messaging/email across its proprietary secure network.
The City first contracted with Bloomberg Finance, L.P. in November 2009 , and has
spent approximately $166,13 0 since the contract was first executed . S taff expects total
expenses to pass $175,000 in February 2017 . The contract renews every two years
upon mutual consent between the City and Bloomberg.
Discussion
Bloomberg’s service provides essential economic in formation for investment decisions.
The Assistant City Treasurer uses the service to access real -time information, monitor
economic and market data, and assess any related impact on the City’s investment
portfolio. The system’s analytical tools for valui ng investment opportunities and
modeling performance also assist the Assistant City Treasurer in making prudent
investment decisions.
Vendor/Consultant Selection
Staff recommends that Council authorize the continued use of Bloomberg Finance,
L.P.’s propr ietary software data, information services, and equipment . This qualifies as
an exception to the competitive process per SMMC Section 2.24.080 (d), where
c ompetition does not exist because only one vendor possesses the unique ability or
capability to meet the particular requirements of the solicitation, such as a good or
service that is copyrighted, patented or otherwise only available from one license
holder . Bloomberg Finance L.P.’s software system is proprietary. The City also values
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its strong securit y features including biometric log on authentication, remote access,
access to approved broker/dealer inventory, ability to request competitive bids/offers
online, electronic trading , and accurate and timely security pricing and other fixed
income investme nt data. Due to the unique and proprietary nature of the Bloomberg
services, staff is recommending a total contract term, including the renewal period of ten
years.
Financial Impacts and Budget Actions
Total estimated costs for the recommended authoriza tion period of five years with a
five -year renewal period are projected to be $273,000. The costs of the contract are
spread among all funds that are part of the City’s pooled investment portfolio. No
budget actions are required. Future year funding is c ontingent on Council budget
approval.
Prepared By: David Carr, Assistant City Treasurer
Approved
Forwarded to Council
Attachments:
A. Oaks Form
Oaks Initiative Notice
CITY OF SANTA MONICA
NOTICE TO APPLICANTS, BIDDERS, PROPOSERS
AND OTHERS SEEKING DISCRETIONARY PERMITS, CONTRACTS, OR OTHER
BENEFITS FROM THE CITY OF SANTA MONICA
Santa Monica’s voters adopted a City Charter amendment commonly known as
the Oaks Initiative. It prohibits a public official from receiving specif ied personal benefits
from a person or entity a fter the official votes, or otherwis e takes official action, to award
a “public benefit” to that perso n or entity. Examples of a “public benefit” include public
contracts to provide goods or services worth more than $25,000 or a land use approval
worth more than $25,000.
The Oaks Initiative requires the City to provide this note and information about
the Initiative’s requirements. An information sheet on the Oaks Initiative is attached.
You may obtain a full copy of the Initiative’s text from the City Clerk.
In order to facilitate compliance with the requirements of the Oaks Initiative, the
City compiles and maintains ce rtain information. That info rmation includes the name of
any person who is seeking a “public benefit.” If the “public benef it” is sought by an
entity, rather than an individua l person, the information includes the name of every: (a)
trustee, (b) director, (c) partner, (d) officers, or (e) ten percent interest in the entity.
Therefore, if you are seeki ng a “public benefit” covered by the Oaks Initiative, you must
supply that information on the attached form (Attachment A).
(Attachment A)
City of Santa Monica
Oaks Initiative Disclosure Form
All persons or entities receiving public benefits defined below from the City of Santa Monica
shall provide the names of trus tees, directors, partners and o fficers and names of those with
more than a 10% equity, participation or revenue inte rest. This information is required by City
Charter Article XXII—Taxpayer Protection.
Name of Entity: ____________________________________________
NAME(S) OF PERSONS OR ENTITIES RECEIVING PUBLIC BENEFIT:
NAME(S) OF TRUSTEES, DIRECTOR S, PARTNERS, AND OFFICERS:
NAME(S) OF THOSE WITH MORE THAN A 10% EQUI TY, PARTICIPATION OR
REVENUE INTEREST:
Public benefits include:
1. Personal services contracts in exce ss of $25,000 over any 12-month period;
2. Sale of material, equipment or supplies to the City in excess of $25,000 over a 12-month period;
3. Purchase, sale or lease of real property to or fro m the City in excess of $25,000 over a 12-month period;
4. Non-competitive franchise awards with gross revenue of $50,000 or more in any 12-month period;
5. Land use variance, special use permit, or other exception to an established land use plan, where the decision has a value
in excess of $25,000;
6. Tax “abatement, exception, or be nefit” of a value in excess of $5,000 in any 12-month period; or
7. Payment of “cash or specie” of a net value to the recipient of $10,000 in any 12-month period.
Prepared by: __________________________ Signature: ________________________
Date: __________________________ Title: ________________________
FOR CITY USE ONLY:
Bid/PO/Contract # ___________________________ Permit # _____________________________________
(1/06)
Bloomberg Finance L.P.
Bloomberg Finance L.P.
See Attachment.
See Attachment.
Jacqueline Messina
December 22, 2016 Authorized Signatory
Reference:
Agreement No. 10411
(CCS)