La Mesa City Treasurer Matt Strabone resigned from office effective Aug. 12 to take an overseas job with NATO.
After he left office, and his decade of work in law, politics and media in San Diego, we checked in with Strabone to reflect on the state of the city, the region as a whole and whether La Mesa needs an elected treasurer in the first place.
The city council voted to appoint a city treasurer through an apolitical process to avoid the cost of a special election. The seat is up for grabs in November’s election.
What were your top takeaways after serving as La Mesa treasurer? Did you have any favorite parts?
I am pleased to say that I delivered on every single one of my campaign promises, and I have left La Mesa’s investments and finances in better shape than I found them.
My job as city treasurer was to manage the city of La Mesa’s investments. Our investment options are limited by state and local statute to things like bonds issued by the federal government and its agencies, bank CDs, corporate bonds, and certain public accounts akin to money market accounts that are operated by the state and the county. These are significant limitations, but I was nonetheless able to ensure that, in each full year that I served as city treasurer, investments under my management earned La Mesa the most money it had ever earned from its investments in a single year across its entire 114-year history. These record-breaking results brought millions of extra dollars to La Mesa without needing to raise taxes or cut services, which is exactly what I promised voters I would do when I ran for this office four years ago.
Additionally, as a practical matter and as a matter of principle, I did not believe that La Mesa should use its public money to buy corporate bonds, and over the course of my tenure as city treasurer, I removed all corporate bond holdings from La Mesa’s portfolio. Practically speaking, corporate bond rates were not superior to federal agency bonds or bank CDs, and corporate bonds carried the extra risk of loss if the corporations issuing them missed a bond payment, or worse, went out of business. It therefore did not seem reasonable to invest La Mesa’s money that way. But it also seemed wrong in principle — corporate bonds are essentially a loan made by the bondholder back to the corporation issuing the bond, and I do not think that the people of La Mesa elected me to loan their taxpayer dollars to huge multinational corporations like JPMorgan Chase or Apple.
The responsibility of managing an investment portfolio that can be as large as $90 million, depending on the time of the year and the bills the city must pay, was my favorite part of the job. To have been endowed with that responsibility by my community is something that I will always cherish. I also enjoyed presenting my quarterly investment reports at city council meetings; those reports gave me an opportunity to demystify the work I was doing and let my fellow La Mesans know how their tax dollars were working to create even more money for our city.
Most cities don’t have an elected city treasurer. After serving in the position, what value do you think it brings? Should more cities have elected treasurers, or should it go the other way, with La Mesa and other cities moving to an apolitical treasurer process?
Having served as the elected city treasurer, I can now say that I do not believe La Mesa should have an elected city treasurer. It is asking a lot of our city of 61,000 to identify someone from our ranks every four years who (1) understands public fixed income markets well enough to make informed investment decisions, (2) is willing to make important decisions affecting tens of millions of dollars while earning $13,200 per year, and (3) is crazy enough to be willing to run for public office, but also (4) will not attempt to use the platform and authority granted by the office to pursue ideological pet projects that have nothing to do with the scope of the job. The potential for subpar outcomes, or even mischief, is troubling.
Instead, La Mesa should, first, abolish the office and assign its duties to the city’s finance department, and second, establish a new Investment Committee to oversee the finance department’s investment decisions, comprised of two city councilmembers, the city manager, the finance director, and an appointed member of the public. Letting the finance department manage the city’s investments will make it easier for staff to coordinate the timing of the investments against any unexpected costs or expenditures that arise for the city, while meaningful oversight from the city council and the public will ensure that there is accountability for the investment choices that are made.
Lest anyone believe that I waited until I was out of office to advocate for the abolition of my office, in February I publicly asked the city council to consider eliminating the elected office of city treasurer, though my plea appears to have fallen on deaf ears.
Where do you think San Diego is in terms of being a low- versus high-trust society? You were involved in politics for years. Is our region moving in a good direction?
Unfortunately, our nation as a whole has been sliding in the low-trust direction for some years now, and I don’t think our region can overcome that on its own. But even putting that aside, in the 11 years that I have been involved in the politics of the San Diego region, I’m not sure I would be able to point to much in particular that has greatly increased interpersonal trust or trust in authority, or fostered a broad consensus on an important civic matter. If anything, I get the sense from people I speak with in everyday situations that they have less confidence in their local government than ever.
Of all the work you did, what do you think contributed the most to building a trustful society?
I don’t know. I hope that my quarterly reports gave some people a new understanding of the often-opaque workings of a city’s investment management. I hope that my campaign four years ago helped some folks understand what the city treasurer actually does. I hope that my occasional op-ed or media appearance helped clarify a confusing issue for someone.
What will you miss most after moving overseas?
My friends.
