FULLERTON : Council Quizzes Finance Director on Investing
City Council members this week pelted Finance Director Barbara A. Henderson with questions about the county’s failed investment pool, in which Fullerton invested about $22.8 million.
“The city buried quite a bit in this pool,” said Councilman Chris Norby. “What oversight did we have on our investment? Whose responsibility is it to oversee the fund?”
Henderson said she is responsible for the city’s finances but that once money was deposited in the county’s pool, it was the county’s responsibility to monitor it.
“While this is definitely a crisis, it’s a crisis linked with an opportunity,” Norby said. “I think we should insist on the 100% return on the dollar rather than wait for them to tell us what they will do to us. We can suggest to the county what they can do--try to make a silk purse out of a sow’s ear.”
Henderson said the city has taken steps to avoid making investments in risky funds in the future. City money now will be placed in treasury notes, which are considered safe investments, she said.
Councilman Peter Godfrey wanted to find out why Fullerton didn’t take its money out of the pool.
Henderson said that she didn’t realize the pool was in trouble, but that when a brokerage firm suggested that Fullerton borrow money to put in the failed fund, she refused.
“Thank God we’re a fairly minor player,” Councilwoman Jan M. Flory said.