Title
Requisition No. REQ-0002876
Investment Advisor
Vendor: PFM Asset Management, a division of U.S Bancorp Asset Management, Inc.
Status: New Contract/PO
Body
Agenda of: October 22, 2025
Item No.: 2025-301
Amount: 3-Year Initial Contract $1,275,000.00
First Year Renewal Option 425,000.00
Second Year Renewal Option 425,000.00
Total $2,125,000.00
TO: The Honorable
Board of Directors
Great Lakes Water Authority
FROM: Suzanne R. Coffey, P.E.
Chief Executive Officer
Great Lakes Water Authority
DATE: October 22, 2025
RE: Requisition No. REQ-0002876
Investment Advisor
Vendor: PFM Asset Management, a division of U.S Bancorp Asset Management, Inc.
Status: New Contract/PO
MOTION
Upon recommendation of Nicolette Bateson, Chief Financial Officer/Treasurer, Financial Services, the Board of Directors (Board) of the Great Lakes Water Authority (GLWA), authorizes the Chief Executive Officer (CEO) to enter into Requisition No. REQ-0002876, “Investment Advisor” with PFM Asset Management, a division of U.S Bancorp Asset Management, Inc., at a cost not to exceed $1,275,000.00 for a duration of three (3) years with two (2) one (1) year renewal options at a cost of $425,000.00 for each renewal year for a total contract amount of $2,125,000.00; and authorizes the CEO to take such other action as may be necessary to accomplish the intent of this vote.
BACKGROUND
The Great Lakes Water Authority (GLWA) has worked with an investment advisor since the stand-up of the organization to assist in the management of its investment portfolio. The use of a registered investment advisor has proven to be a cost effective and efficient approach to portfolio management. The investment advisor allows GLWA to have direct access to financial market data sources, technology and expertise while allowing the treasury team to focus on the development of cash flows, treasury internal controls, and process improvements. Using an investment advisor has helped GLWA to achieve higher portfolio returns, properly manage market risk and diversify portfolio holdings. The contract with the current investment advisor, PFM Asset Management, LLC expires on January 31, 2026. In keeping with GLWA’s ongoing cycle to solicit proposals for key professional services, a request for proposal (RFP) for “Investment Advisor Services” was posted on Bonfire. See attached Procurement Report for details related to the RFP process.
JUSTIFICATION
A competitive solicitation process resulted in six responses. The scoring was based on technical ability (20%), Experience & Qualifications (20%), Project Team and Key Individuals (15%) from the written proposal. From that list, a subset of firms that scored the highest were selected for an oral interview (35%). The sum of those items totals 90%. After scoring those criteria, cost information (10%) is scored. It should be noted, however, that the costs were submitted with different dollar ranges and fees making a precise and objective cost comparison challenging. Each firm selected for an interview was then contacted and asked to clarify their bid proposal using a total portfolio assumption of $1 billion. Attachment 1 provides Bid Table 1 with the original submission and Bid Table 2 with the clarified information.
The evaluation committee then completed their final review of the proposals, costs, and oral interviews and selected PFM Asset Management, a division of U.S. Bancorp Asset Management, Inc. (PFM), to serve as investment advisor for GLWA. The fee for investment advisor services is billed monthly based on the actual managed portfolio balance. The annual fee, calculated using a portfolio balance of $1 billion, would be $425,000.00. The fees are inclusive of all investment advisor services to GLWA including managing the portfolio, preparation and presentation of investment reporting and other requested presentations to the audit committee and board, as well as travel and incidental expenses. This fee amount is 3% less than PFM’s current contract pricing and is also less than 1% of GLWA’s total investment income earnings in each of the past two years.
PFM Asset Management, LLC has performed well for GLWA on their previous contract. PFM’s team has collaborated with the GLWA treasury staff to 1) negotiate and increase bank earnings credit rates, 2) invest debt service and debt reserve funds, 3) transition balances in bank deposit accounts to higher yielding government money market and local government investment pools, 4) invest funds in construction and trust accounts into longer term investment securities, 5) develop quarterly investment report package and 6) identify a portfolio strategy appropriate for GLWA. With PFM’s assistance, GLWA investment income earnings have ranged from $22.3 million in FY 2019 to $59.5 million in FY 2024.
FINANCIAL PLAN IMPACT
Summary: The investment advisory services under the proposed contract are within the current financial plan.
Funding Source: Operations & Maintenance (O&M) Budget - 5910
Cost Center(s): Treasury - 884131
Expense Type(s): Contractual Professional Services
Estimated Cost by Year and Related Estimating Variance:
Fiscal Year Amount
FY 2026 Budget $440,000.00
FY 2027 Financial Plan 440,000.00
FY 2028 Financial Plan 440,000.00
FY 2029 Financial Plan 440,000.00
FY 2030 Financial Plan 440,000.00
Total Financial Plan Forecast $2,200,000.00
Proposed Contract Amount $2,125,000.00
Forecast Variance (positive/(negative)) $75,000.00
COMMITTEE REVIEW
This matter was reviewed by the GLWA Audit Committee at its meeting on September 26, 2025. The Audit Committee unanimously recommends the resolution to enter into Requisition No. REQ-0002876, “Investment Advisor” with PFM Asset Management, a division of U.S Bancorp Asset Management, Inc., at a cost not to exceed $1,275,000.00 for a duration of three (3) years with two (2) one (1) year renewal options at a cost of $425,000.00 for each renewal year for a total contract amount of $2,125,000.00; and authorizes the CEO to take such other action as may be necessary to accomplish the intent of this vote.
SHARED SERVICES IMPACT
This item does not impact the shared services agreement between GLWA and DWSD.