The Apopka City Council voted 3-2 at its December 6th meeting to amend its investment/portfolio policy. The previous resolution was written in 1995. The vote was successful despite a last-minute pushback from the Apopka Area Chamber of Commerce and two local banks.
According to the agenda packet for the meeting, on October 18th, the City's Investment Advisor, Morgan Stanley, presented the proposed changes and
revisions to the City's Investment Policy for Council review and consideration.
The presentation included an overview of the following topics:
The report stated that the revised resolution included the comments and recommended revisions proposed by the Council and was ready for final adoption. The staff, led by Finance Director Blanche Sherman, recommended adopting the resolution to amend the almost 30-year-old ordinance.
It seemed like a safe bet this would be a quick 5-0 vote, but then public comment entered the discussion.
Amanda Allen, the assistant branch manager at the Seacoast Bank in Apopka, brought two letters with her to read into the record.
"This was presented to us today from the Apopka chamber," she said. "On behalf of the chamber board of directors, we humbly request your kind reconsideration of the recent motion to utilize financial accounts outside of the Apopka community. With utmost respect, we acknowledge the city commissioners' responsibilities to make decisions that align with the best interest of our city. However, we firmly believe that the utilization of external financial accounts may have unintended consequences that could potentially hinder the Apopka community."
Then Allen read a letter from Frances Portalatin, the Seacoast Vice President and banking center manager for the Apopka branch. "
"When I think of a community or being part of a community, some things that come to mind are like-minded individuals who share common interests, attitudes, and goals. It is a sense of belonging to a group or community to better the place that they share. It could be a place of living or a common ground where time is spent. At Seacoast, we have personally ensured that we live that promise and our community and invest in it."
The letter listed many local charities and non-profits that Portalatin believes could be adversely affected if the City's funds were to leave Seacoast.
Elza Clarke-Samuels, the Vice President and Retail Market Manager of Synovus Bank in Apopka, also expressed concerns.
"We do a lot of activities as well, but I won't go through the long lists of our involvement," she said. "I have seen a lot of businesses come into the city. We get involved in many ribbon cuttings, introducing ourselves and providing products and services to help businesses grow. So keeping the funds here and investing in what we have going on here is a big plus for us and a big plus for many of our small businesses."
The pushback seemed to surprise Commissioner Kyle Becker.
"I thought the (Apopka Area) Chamber of Commerce is supposed to be partners with this body, not just to drop off a letter," he said. "I personally have not received any requests to have an engaging and thorough conversation. It's disappointing that the Chamber president would not be able to speak on her behalf. But to that end, Seacoast and Synovus are great partners. They are great community partners. I think the spirit of the investment policy, maybe when it was originally written or the last time that it was materially changed was in the early 90s. It's been a while. And I think the spirit of it was true community banks in this particular city's confines. Not to diminish the value that Seacoast and others provide. But it's the eighth largest in terms of market share in the metropolitan statistical area. Regardless, many of our funds are still at Seacoast. They haven't moved—and the same thing with Synovus. I'm in banking myself. So I know how that can be, you want to make sure that your branch is thriving and you can meet the needs of your community that you're in. But at the same time, these are large organizations. They have a lot of deposits outside of the city of Apopka. And I think all our discussions thus far have ensured that we have the best return for our taxpayers' money."
Despite being present for the investment/portfolio discussions and the October 18th presentation, Smith seemed unaware of the possibility that part of the money could be moved outside Apopka banks.
"I didn't think we intended to take the money outside of the city and invest it elsewhere," Smith said. "I understood that we discussed not putting all the money into one pot. I firmly believe that those financial institutions inside our city not only support city residents but also the businesses in this community. We should support them as well. It has been a family. And that's what we are... we live in a small community. We are a family-oriented community. And I think we need to remain that way."
Commissioner Nick Nesta, who was the catalyst of this revised referendum, wanted to clarify that nothing was happening overnight and that the new referendum was a long-term plan.
"I understand from this letter that the Apopka Chamber and the two local banks that we use feel like we're taking all our finances out of the city and investing it all with Morgan to manage the finances, but we're not doing that. Again, this is a long-term goal. As our custodial bank, this bank is right for those particular services where we buy those securities. And they will be the custodian of those securities. So we do have an additional relationship with them as well. But nothing is going to happen overnight. And every step we take will come back to this Council. An investment strategy will be presented to this Council before we move anything. We have thresholds in there if we choose to move $10 million or more, that will require Council authority."
Cate Manley, the Apopka Area Chamber of Commerce CEO/President, was given the opportunity to address the Council after public comments about the Chamber's letter.
"We're very concerned about some of the things that our local banks are able to support," Manley said. "Many of our educational sponsorships also extend to our businesses or local businesses, as well as some of the things that may happen if this amount of money were to leave the community as far as lending abilities to some of our smaller local businesses, so the board of the Chamber of Commerce feels very strongly that we would really like you to consider another way... that doesn't remove the funds from the community. Whenever we do initiatives, picking up trash or having a reading on location, those are things that we're going to lose. We won't have that relationship with somebody not in this in the city. So, we just want you to consider those unintended consequences when choosing this, if that makes sense."
"You make a statement here; 'we humbly propose engaging in a thorough discussion, where the perspectives of various stakeholders, including local businesses and community organizations, can be considered," said Becker. "Why now? Why, when we're basically going to take a vote on this resolution when we've had many public hearings on this investment policy... does this get dropped in our lap?"
"Great point," said Manley. "It did. I was not aware that it had moved forward. I missed the Council. I typically watch and look at the minutes after, and I missed that it was approved the first time. It has been a hot topic, both in the Council but also on social media. There was so much noise around it that I did not know it had passed the first time or I didn't know it was up for approval the first time and then realized that this was the last one."
"I'm struggling with it being a hot topic because I have not received one email asking for conversation by the chamber or any chamber members that this might impact," Becker said.
After hearing the concerns of the chamber and banks, Mayor Bryan Nelson thought it would be prudent to table the discussion and the vote until 2024.
"I guess the banks were not as informed as they should have been," Nelson said. "Well, I'll take some of that credit or blame. We haven't had an updated policy since the 90s. Can I make a suggestion that we table this until the January 3rd meeting? We'll have a chance to meet with the banks and see if there's some way we can get to a point where everybody's comfortable. We can meet with the banks, each commissioner, and obviously Blanche?"
But Commissioner Diane Velazquez thought the process had been thorough and did not want to table the vote.
"I remember when Morgan came in and made the presentation," she said. "It has been very public. At this point, tabling it, and now we're going to start talking to the banks? I mean, we've invested a lot of time and research. Morgan has gone through our finances and determined how to do this. But this is telling me that we're, you know, by taking an investment outside of the city, that we're disrupting all these small businesses. And we're disrupting their capability to continue to sponsor and donate to the local 501c3s. That's how I'm reading this. And I don't believe that that was our intention. And I don't believe that going with an investment firm will impact them as negatively as what this is saying."
"And again, this is a policy, it's not set in stone, it's not anything that we can't say, 'you know what, for this and that we can massage it a little bit and make it work.' Nesta said. "So, again, the timing of this is odd. And I think we've needed a policy for a very long time... it needed to be updated. The resident's money is very important. And it helps to keep taxes low, but also make sure our funds are invested in a safe capacity as well, which they currently are. So again, the timing of this is strange. Nesta, like Becker, said he was never approached about the issue."
Nesta, like Becker, was also surprised the issue never arose during the lengthy process.
"I'm out at all events, so it's odd that none of this has come up, when I'm sitting in offices and sitting out with other entities that have spoken today that this doesn't come up. So I'm okay, moving this forward, we can massage it as we need to down the road. I don't want to belabor this any longer. It's just strange. The timing is strange to me."
Becker, Nesta, and Velazquez voted in favor of the referendum, while Nelson and Smith voted against it.
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