Coastsider endorses Dave Mandelkern for Treasurer-Tax Collector


Posted by on Thu, May 20, 2010

Dave Mandelkern

This a personal endorsement. Normally, I wouldn’t be making an endorsement for a countywide position that should be appointed, rather than elected. But this time around, there is a candidate that I personally know to be the kind of person we need in county government.

I have known Dave Mandelkern for more than thirty years. Dave’s an entrepreneur and trustee of the San Mateo County Community College District. But, more importantly, I know Dave to be an honest advocate of good government. Dave has been working for years to improve the quality of government and elected officials in our county.

If you’re the kind of person who skips these races because you have no idea who to vote for or why you’re even voting, this is an opportunity to make a difference. I recommend you vote for Dave Mandelkern for Treasurer-Tax Collector this year.

I heartily agree with your endorsement of Dave Mandelkern, Barry. Thanks for getting the word out about a great candidate!


You have me beat. I’ve only known Dave for thirteen years.

When I was the Foreman of the San Mateo County Civil Grand Jury in 1997, David Mandelkern was absolutely the best grand juror that served that year.

John Lynch

Barry, John and April…

I don’t have the advantage of knowing any of the candidates for this post, so I appreciate your opinions. However, Mr. Mandelkern has one position that concerns me, namely the mandatory sale of bonds that are downgraded. Seems like a potentially mistaken policy idea. Can you comment?

Thanks… Mike Gaynes

Let’s open with the caveat that it has been a while since I took a finance class, and I’m not endorsing Dave Mandelkern on the basis of this policy.

I’ve also asked Dave to reply in the comments here.

In the case of a public agency, such a strict policy might be the safest course. At minimum, it seems like the correct default policy. Buying or keeping downgraded securities may make sense if you’re able to hedge your risk, it’s a small part of a diversified portfolio, and you’re a very sophisticated investor, such as an investment bank or hedge fund.  I’m not sure I trust San Mateo County to make those decisions.

I received the following in an email from Dave Mandelkern. It sounds like his proposed policy is a lot more nuanced than a mandatory sale.

My position on down-grades is somewhat misstated by the poster (perhaps based on erroneous reporting in other publications). My position is that the County Investment Policy needs to be strengthened in several ways.

One of those is how we respond to downgrades on securities being held in the Pool portfolio. The current approved Investment Policy (January 2008) simply states “If a security is downgraded while in our portfolio, each case will be evaluated on its own merits (to hold or sell) and the investment committee will be notified.” The proposed but currently unapproved 2010 Investment Policy states “All securities purchased with any funds received as a result of such lending shall be regularly monitored and re-evaluated should their ratings be downgraded below the minimum investment grade level required of the Pool and the Treasury Oversight Committee will be notified, in connection with the Pool’s monthly reports, of the downgrade of any such securities in the portfolio.”

I don’t think this is a tough enough policy, and is one of the key factors that led to the loss of $155 million of our County’s money in the Lehman Brothers bankruptcy. My recommended policy change would be to maintain the current policy (“If a security is downgraded while in our portfolio, each case will be evaluated on its own merits (to hold or sell) and the investment committee will be notified”) and the following tougher language should be added: “If a security held in the Pool is downgraded below the minimum investment grade level required of the Pool, an evaluation as to whether to hold or sell the security should be made immediately, and the Treasury Oversight Committee must be notified immediately. The position in the downgraded security should be re-evaluated on a daily basis to determine whether the security should continue to be held or be sold, until such time as the rating is upgraded above the minimum investment grade level required of the Pool, or the security is sold.”

There is certainly a presumption in my mind that if a security has been downgraded below the minimum investment grade required of the Pool, that is a major red flag and one should seriously question the appropriateness of that security in the Pool portfolio, and selling (even at a loss) may well be the appropriate and likely course of action. I would stop short of saying that there should be a mandatory “sell-on-downgrade” policy, as there may be circumstances that would warrant continuing to hold the security. However, the position would certainly need to be monitored and re-evaluated frequently and regularly (daily), and monthly reporting is not adequate.

Very helpful. Thank you.

Joe Galligan is the only candidate with 30 years as a CPA, preparing tax documents, providing investment advice and running a respected and successful business.  Joe has a BA in Accounting and an MS in Taxation.

Joe Galligan is the only candidate who has attended the County Treasurer’s investment committee meetings after the 155 million dollar Lehman loss.  Joe also attends the county retirement, SAMCERA, board meetings.

The Treasurer-Tax Collector is a finance job that is best served by a financial expert. Joe Galligan is the only candidate that fits this criteria

Joe Galligan has served as Mayor, City Council Member and has served as Treasurer for numerous county non-profits, including Heart, Community Gatepath and the Legal Aid Society of San Mateo County.

This position should not be elected.  It is a technical position that should be recruited and appointed.  No matter how talented Dave Mandelkern is, if this was 2014 and the county ordinance standards were in place, Dave Mandelkern could not run for this office.