Since FY 2020-2021, the investment returns in the City of Carlsbad Reserve Funds have underperformed relevant benchmarks.
In fact, the mark-to-market losses a few years ago exceeded $30 million in just one fiscal year and an additional $12 million in the following fiscal year.
For context, $30 million is greater than 12% of Carlsbad's annual general fund budget.
Transparency from the Treasurer's office regarding the investment performance in the City Reserve Fund has been unacceptably low.
The monthly and annual reports from the Treasurer have not provided direct "plain English" explanations of the investment returns in the City Reserve Fund.
This lack of functional transparency is particularly probematic in the context of the unprecedented losses experienced in the fund in 2 of the last 5 fiscal years.
Furthermore, the records of Carlsbad's now disbanded Investment Review Committee (agendas, minutes, reports, etc.) are not available on the Carlsbad City website where the commensurate information is archived for all other city boards and commissions. An official public records request is required to obtain these documents, if they even exist.
The replacement Investment Review Board was filled with members hand picked by the Treasurer - this does not create real transparency and independent oversight.
The previous Carlsbad Investment Review Committee either did not function at all or did not function effectively.
Whatever steps the Carlsbad Investment Review Committee took, if any, did not stop the prior Treasurer from making the extremely poor investment decisions that resulted in over $30 million in mark-to market losses in just one fiscal year and an additional $12 million of losses in the following year (FY 2022 & FY 2023).
Neither the replacement Investment Review Board nor the current City Treasurer has published any direct analysis or substantive explanation for the combined $42 million in mark-to-market losses in FY 2022 & 2023. If elected, I will ensure that such an analysis is conducted, and I will provide an easy-to-read "plain English" report for the residents of Carlsbad to ensure that such monumental losses never occur again.
If elected Treasurer, I will also ensure that "plain English" clear explanations of investment returns are front and center in all Treasurer reports to separate the impact of investment returns from fiscal deposts and withdrawals.
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