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Staff Report Item 3.B 10/7/2013
, Agee daiItem'#3 ._3_ .CALU\.t\r C x lass DATE: October 7, 2013 TO: Honorable Mayor.and Members of the City Council through City Manager FROM: William Mushallo, Finance Director/City Treasurer SUBJECT: Resolution to Receive;and File the City Treasurer's Report for the Period Ending June 30, 2013 • RECOMMENDATION It is recommended that the City Council adopt the attached Resolution to Receive and File the City Treasurer's Report dated June 30, 2013. BACKGROUND Pursuant to the City's Investment Policy and Government Code, the City Council annually delegates authority to the City Treasurer to invest or reinvest City funds. The City Council approved the City of Petaluma Investment Policy on June 18, 2012 which delegated investment authority to the City Treasurer-for the Fiscal Year 2012-13. The City Treasurer is required to provide a quarterly investment,report to the Council that includes the status of the investment portfolio.. The attached report outlines the current investments; the weighted average and yields of pooled investments, investments managed by Public Financial Management (PFM), and earnings received by investments in the Local Agency Investment Fund(LAIF). The report also includes the Treasurer's certification of adequate cash flow. This is the fourth quarterly report for the Fiscal Year 2012-2013. DISCUSSION It is.the policy of the City of Petaluma to manage public funds in.a manner consistent with the laws of the State of California pertaining to the investment of public funds. Three primary goals of the City are'to safeguard.the principal of funds under its control; meet the City's daily cash flow requirements; and achieve.a reasonable rate of return with the maximum amount of security possible. The attached quarterly Treasurer's Report contains information on the City's cash activityand ending balances imall City accounts. The report: • Summarizes total beginning balances of all cash and investments, and total quarterly activity and ending balances; Agenda.Review: City Attorney Finance Dire tor City Manager i • Provides quarterly activity: and ending, balances in the City's cash equivalent accounts and information about trustee account activities and.ending balances; • Provides information on investment portfolio activity, security type, maturity and value, and book and fair value;;and • Compares the City's y's quarterly investment<eamingswith the City's benchmark. The City's benchmark is the Merrill Lynch 1-3 year US Treasury index as provided by Bloomberg Financial Markets. That rate was (.11%) for the past quarter. The City's annualized return is slightly lower than the.index,coming in at (.15%) during'the,quarter, but has exceeded the index for the past five years. 'The City's rate of return over thepast 5 years was 2.33% and the Merrill Lynch 1-3 year US Treasury index was 1.77%. FINANCIAL:IMPACTS The balance of cash and investments as of June 30, 2013 was $121.2 million.. This amount is down $3.3 million from the balance at,the end of the prior_quarter. The,majority of the reduction in cash balance was due to the $8'75 million Department.of Finance (DOF) demand repayment to the County and $4 million in debt service payments. These were partially offset by $10.5 million received in property tax. The City received a,total of$109,045.76 in interest earnings during the quarter ending June 30, 2013. The required action is to receiveiandfile the Treasurer's Reports. ATTACHMENTS 1. Resolution to Receive;and File the City Treasurer's Report dated June 30, 2013. 2. City Treasurer's Report Dated June 30, 2013. o�- ATTACHMENT I RESOLUTION TO RECEIVE AND FILE THE CITY TREASURER'S.REPORT DATED June 30, 2013 WHEREAS, the City,Investment policy requires the City Treasurer to provide a quarterly investment report to the Council for compliance with the adopted City Investment Policy. NOW, THEREFORE'BE IT RESOLVED that the City Council has received the report dated June 30, 2013 and directs the City Clerk to file it. 3 City of Petaluma Quarterly Investment Report April 1,, 2013 to June 30, 2013 • LU 185 $ This report is presentedin accordance with the City's investment policy and the California Government Code. The policy and Government Code requires the Treasurer to certify that tsuffcient cash flow is available for the next six months to meet the expected demand or provide;an•explanation as to why sufficient cash may not be available. The attached report;outlines thc current investments, weighted average and yields of pooled investments. The month end account'statement of assets managed by Public Financial Management, LLC (PPM), the Local Agency Investment Funds (LATF) quarterly statement, and the City's performance summary of portfolio investments as:compared to applicable benchmarks are included. The report also includes the Treasurer's certification of adequate cash flow. We respectfully submit the quarterly investment report for the quarter ending June 30, 2013 II CITY OF PETALUMA, CALIFORNIA CITY TREASURER'S QUARTERLY REPORT For the quarter ending June 30, 2013 Cash activity for the fiscal year: Cash and Investments, Beginning of the quarter, 03/31/2013 $ 124,509,296 Cash Receipts 99,102,218 Cash Disbursements (102,446,917) Cash and Investments, End of the Quarter,06/30/2013 $ 121,164,597 Cash and Investment Portfolio at June 30,2013 Percent Fair Market Par Value of Value* (Cost) Portfolio Investments.Managed by City Treasurer: Assessment Districts Bonds 602,262 602,262 0.50% Local Agency Investment Funds (LAIF) 48.911;789 48,928,121 40.38% CAMP Pool (CA Asset Management Prog) 15,825,997 15,825,997 13.06% PFM Investments Securities ** 23,947.756 24.126,400 19.91% Certificate of Deposits 250,000 250,000 0.21% Checking Accounts 6,441,363 . 6,441,363 5.32% Subtotal 95,979,168 96,174,143 79.37% Investments Managed by Fiscal Agents: CAMP Debt.Issue Accounts 11,572,185 11,572,185 9.55% Trustee Money Market Accounts 13,418,269 13,418,269 11.07% Subtotal 24,990,454 24,990,454 20.63% Total Cash and Investments 120,969,621 121,164,597 100.00% I certify that this report the total amounts of cash and investments at June 30, 2013 The investments are in conformity with.the Investment Policy. A copy of the investment.Policy is available for review in the Finance Department. The City Treasurer's cash management program provides sufficient liquidity to meet'expenditure`requirements for the next six months. We respectfully submit thequarterly investment report for the quarter ending June 30, 2013 William Mushallo, FinanceDirector *Fair market values furnished by the State of California, Local Agency Investment Fund and California Asset Management Program. **See detail attached 5 C MTI'OF PETALUMIA,,CALIFORNI A CITY TREASURER'S QUARTERLY REPORT •For the quarter ending June 30,.2013 " "b —sv °° .r r axi s j Pr r 4!ea irtht � c \.. r,r; _ -*1 ui o1.', -" y tq - Re R4 Ib�14a Y t s'54'o0o .04 3.;t_r. n.. ss,7AV.z ,nP•Itni ter' o a1 fri1 { 0=' s _ � 1 a'P,, ISMS. Investments Managed by City Treasurer: Assessment District Bond(AD) 2000-01 602,262:31 602,262:31 Sub-Total Assessment Districts Bond (AD)Accounts 602,262.31. — - 602,262.31 LAIF 48,864402 S3 3402726 - 48,898,429 79 LAIF accrued interest 34,027.26 29,691.03 (34,027.26) 29,691 03 Sub-Total LAIF 48,898,429.79 63.718.29 (34,027.26) 48,928,120.82 CAMP Pool-Treasurer's Investment Money Market 21,487,934 12 .4,843;358 23 (10,505,295.11) 15,825;997.24 Sub-Total CAMP Pool Managed Account 21,487,934.12 4,843,358:23 (10,505,295.11) 15,825,997.24 Federal Agency,Bonds/Discount Notes 9,912,18266 - (2,520:261.00) 7,391,921.66 Fed"Agency,accruedinterest 29,887.79 27,78715 (44,989 24) 1268570 US Treasury Bonds/Notes 12,058,040.04 3,120,546.88 (2,248 337.88) 12,930,249.04 US Treastirypccruedinterest 26,137.67 74.185 73 (67,462.46) 32,860.94 Corporate Notes 1,6724789.30 479,488.20 2,152,277 50 Corporate Notes accrued interest 3,901,69 4,307.46 (3,093.75) 5,115 40 Ceniftcate of Deposit 500,000,00 1,099023 86 - 1,599023.86 Certi Usti;of Deposit accrued interest 195.00 .1,875.36 (704.17) 1,366.19 Sub-Total PFM Securities Managed Account**' 24,203,134.15 4,808;114.64 (4,884,848.50) 24,126400.29 Subtotal 95,191,760.37. 9,715;191.16 (15,424,170.87) 89,482,780.66 Certificate of.Deposits: Circle Bank 250000.00 220'39 (220.591 250,000.00 Sub-Total Certificate of Deposits 250,000.011 220.59 (2211.59) 250,000.(1(1 Checking Accounts: E xchange-General Operating. 3,695364'.73' 84,752,379.06 (82,357,13423) 6090609:56 Exchange-Pay1o11 8,148.57 715,217.00 (715,33349) 8032.08 Thomas Lee Charity Trust 2,067.38 2,067 38 Police Trust 374,289.72 58 90 (33,694.89) 340,653 73 Sub-Total.Checking Accounts 4,079,870.40 85,467,654.96 (83,106,162.61) 6,441,362.75 1 oral Cash and Investments Managed by the City''I'reasurer' 99,521,630.77 .95;183;066,71 (98,530,554.07) 96,174;143.41 Investments Managed by Trustees Fiscal Agents: CAMP-AD,23,24,25 Accounts Money Market 427,757.31 117.25 - 427,874.56 CAMP-?001B Water Rev,2003 COP,2007 TAB;2011'.TAB i 11,141,251.67 3,058.34 - 11,144,310 01 Sub-Total CAMP-Debt Issue Accounts** .11,569.008.98 3,175.59 - 11,572;184.57 Bank of New York 2,246,50000 - - 2,246,500 00 US Bank First Amcrican;Treas 11,172,156:38 3,915,975.78 (3,916,363.20) 11,171.768 96 Wells Fargo Government Money Market - - Sub-Total Trustees Money.Market Aeeount '13,418.65638 3,915,975.78' (3,916,363.20) 13,418,268.96 Total Cash'and,,Investments Managed by Fiscal Agents '24,987,665.36 3,919,151.37 (3,916,36120) 24,990,453.53 • TOTAL CASH LAND'INVESFMEN'FS 124,509,296.13 99,102,218.08 (102,446,917.27). 121,164,596.94 "See detail attached Accrued interest (81,719.26) General Ledger 121082,877,68 lJ A O N N Z. 6-, O 1 o N r7,- n 0. ov � n n • d�' u J r� = fb9 9 � f„ C r.m t9 t G7 CA p.. D. r N p y c"N'A '� a F/9 e H z © y .x th � '; P � � N M1�`"`. \..A h O R s --.1 W Nti A f. IJ�p d e.ap A ap N A n y D Z a �T_ 7i (.° N A N I 3 :1 0 as . CITY OF,PETALUMA,CALIFORNIA CITY'TREASURER'S QUARTERLY REPORT For the quarter ending June 30,-2013 Cost vs. Fair Market Value Unrealized Cost FV Gain/(Loss) US Treasury Bond/Note 12,930 249.04 12,876,002.74 (54,246.30) Federal Agency Bond/Discount Note 7,391,921.66 7,335,633.05 (56,288.61) Corporate Note 2,152,277.50 2,138,283.55 (13,993.95) Certificate of Deposit 1,599,923.86 1,597.836.90 (2,086.96) Sub-Total PFM Treasurer's Invest. Securities 24,074,372:06 23,947,756.24 (126,615.82) CAMP Pool Money Market Fund 15,825.997.24 15,825,997.24 - Sub-Total CAMP Treasurer's Investments 39,900,369:30 39,773,753.48 (126,615.82) Accrued Interest 52,028.23 CAMP Total Investment Managed`Securities Held 39,825,781.71 CAMP Debt Issue Managed Accounts 11.572,184.57 11,572,184.57 - PFM CAMP Total Treasurer's Investments `* 51,472,553.87 . 51,345,938.05 (126,615.82) LAIF 48,898,429.79 48,911,789.18 13,359.39 LAIF amortized cost rate 1.00027320700 ** See detail attached n n n c z -0.o. ,, n n n c z v o "n to O a ,Jn a s n v n a ^A' irr I4��f���I� J �, a a rD y < N ? N 0". �.at j at G -i. J H nt wO .8 ."-"+/.7r 0..X F 0_ N N F O � 7 7-R< + s u K" 'I'D m .. ipk d R. a r., , nl t ,w- d Y n. C N l n�' ,, C II I 1 `'- M1 11 > . � rn n p W C 3 rt w r rt • % 01 4c) r I m A �' tn'n w "a°NJ -Co -i N A O N V in r N 0 0 0 0 W A N ',O O N iD in ' '1 01 A 0 0 0 0 yD: a o O Co.- DJ • rF .,k •. 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D z 4.33,31 LO N N 1--% � U w in© ul to to to in' -CO tn -CO n to to 0p. m i [`$k,.., m O N O 0 -CO -Co m In W 0 CD o "} "4 m. p1 b t0 V w t0 N N t0 a V N,. N O ,w,t"�`1 10 t0 V to to 0 h-• F' t- s s? N CD .4 V a+ 0 w V W a3 CO a A . -1 s:'.v O /` w 'N N V N W V V V in CO., Il 5 . t, fa at w A a to co to .a ,tn to to m CO O. ; ,14 w Untitled Page Page 1 of 1 4 K 9pgf r ", JOHN CHIANG California State Controller LOCAL AGENCY INVESTMENT FUND REMITTANCE ADVICE Agency Name PETALUMA Account Number 98-49-650 As of 07/15/2013, your Local Agency Investment Fund account has been directly credited with the interest earned on youndeposits for the quarter ending 06/30/2013. Earnings Ratio 00000667321954799 Interest Rate 0.24% Dollar Day Total $ 4,449,280,729.25 Quarter End Principal.13alance $ 48,898,429.79 Quarterly Interest Earned $ 29,691.03 http://laifsco.ca.gov/Result.aspx 8/26/2013 a� State of California Pooled Money Investment Account Market,Valuation 6/30/2013 ry: . s 'Carry mgtCOSUPlus - , ' - 7 '* ' . s s. L, , , Description Accrued Interest P„urc r h'. Amortized Cost Taw-Value, ,....,,,.:Accrueddnteresr, United States Treasury' Bills $ 18;019481,458.84 $ 18031788345.99 1$ 18,035,146,300!00 NA Notes $ -17,866,551,757 96 $ 17,864,039,275:14 ;$ 17,866601,500:00 $ 14,141,398.00 Federal Agency: - 38A. $ 510;792442.52 $ 510,792,442.52:..$ 510,253,568.70. $ 517,567.05. MBS-REMICs $ '192,640,776.24 $ 192640776.24' $ .208,753,614.81 $ 921,014.69 Debentures, $ 1;229,014;`505.38 $ 1,227,601,588:70 $ 1,225;462,000.00 $ 4,859,598.00 Debentures.FR $ - $ - $ - $ - Discount Notes $ 2;248,563;445.13 $ 2,248,994,695.02 $ 2,249,228,500.00 _ NA GNMA $ 451.55 $ 451.55. $ 454.80 $ 4.70 IBRD Debenture $ 450,053;540.85 $ 450,053,540.85 -$ .450;282,500:00 $ 107,637.50 IBRD Deb FR $ - $ - $ - $ - CDs and:YCDs FR $ 400;000;000.00 $ 400,000,000100- $ .400,000,000 00 $ 252,251.67 Bank.Notes $ - $ - $ - $ - CDs and YCDs $ 8:870,1-29',024.17 $ 8,870,011,579.74 $ 8,866,790,803 69 $ 2,820,216.67 Commercial Paper $ 4,253;842,581.96 $ 4;254;541,430.57 '$ 4;254;012,847.23 NA Corporate: Bonds FR $ - $ - $ - $ - Bonds $ $ - $ - ' $ - Repurchase Agreements $ - $ - $ - - $ - Reverse Repurchase $ - '$ - $ $ - Time Deposits $ 4,474,640,000.00 -$ 4;474,640,000.00 $ 4,474,640,000.00 NA AB 55&GF'Loans $ 287,302,443.82 ;$ ,287,302,443 82 $ 287;302,443.82: NA TOTAL $ - 58;803,312,428.42 $ 58,812,406,570.14 $ - '58,828474:533.05: $ 23,619,688.28 Fair Value Including,Accrued Interest $ 58,852,094,221.33 Repurchase Agreements TimeDeposits;AB 55&.General Fund loans,and Reverse Repurchase agreements are carried at portfolio book value(carrying-cost). The value:of each participating dollar equals the fair value divided by the amortized cost(1.000273207). As anexamplezif an agency:has an account balance of$20,000,000.00, then the agency would report itE participation in the LAW val'u'ed at$20,005;464.14 or$20,000,000.00x1.000273207. 33 City of Petaluma Performance Summaries Annualized Returns as;of • • June,30, 2013', City•of'Petaluma" MCTreasury_;_Indeit _ Past Quarter -0.15% -0.11% Past`6 Months -0.04% 0.00% Past.Year 0:34% 0.33% Past 3'Years 0.89% 0.60% Pasts Years 2.33% 1.77% Effective•Duration 1.82 years 1.81 years Yield on Cost 0.50% 0:35% Notes: I. Merrill Lynch Indices provided by Bloomberg Financial Markets. 2. CAMP Cash Reserve Pool holdings,excluded from performance,yield and duration calculations. 3. Performance numbers arc presented'on an annualized basis. 4. The City's Treasury benchmark was the Merrill Lynch 1-3 Year Index from inception to 6/30/12.Then the benchmark switched to the Merrill Lynch I Year Treasury Index.On 6/30/11 the benchmark returned to the Merrill Lynch 1-3 Year Treasury Index. 5. Inception date is 12/3J/01.