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Home My WebLink About4.06 InvestRpt2ndQtr02-03 CI'TY CLERK Fi,e # 320-30 AGENDA STATEMENT CITY COUNCIL MEETING DATE: Febuary 4, 2003 SUBJECT: City Treasurer's Investment Report For 2nd Quarter 2002/2003 Report Prepared by Carole A. Perry, Administrative Services Director and Fred Marsh, Finance Manager ATTACHMENTS: Quarterly Investment Report (December 31, 2002) Section I - Primary Investment Portfolio Section II - Listing of Supplemental Monies Under City ~>~. A ~.~-elve~t/w Rec . Possession and/or Control RECOMMENDATION<~~ ' Report DESCRIPTION: The attached Investment Report details the City's investments as of December 31, 2002, in accordance with the Local Agency Investment Guidelines established by the State Treasurer. Section I of the Report focuses on the principal investment portfolio. Section II details funds held by Trustees and miscellaneous operating accounts. The focus of the discussion in this report will be upon activity in the Primary Investment Portfolio. Changes in the investment portfolio and investment activity for the second quarter of Fiscal Year 2002/2003 are discussed in the staff report below. INVESTMENT ACTIVITY IN SECOND QUARTER FISCAL YEAR 2002/2003 During the Second Quarter four investments matured or were called due to the decline in interest rates that occurred during the quarter, as summarized in the table below: INVESTMENTS MATURED OR CALLED SECOND QUARTER FISCAL YEAR 2002/2003 TYPE AMOUNT MATURITY YIELD Matured Federal Securities FHLB $1,000,000 11/06/2002 6.780% Called Federal Securities FHLB $3,000,000 11/22/2004 3.200% FFCB $5,000,000 12/20/2006 5.340% Matured Certificates of Deposit United California Bank $99,000 12/9/2002 6.000% The City received the full face amount of the investments that were called plus any accrued interest. The proceeds from these investments, along with other available funds, were temporarily placed in the Nations and Union Bank Government Securities money market accounts. COPIES TO: G:\Investments~December 2002XAgenda staff report3.doc ITEM NO. ~ The proceeds from these investments, along with other available funds, were used to purchase one new security during the period, as summarized in the table below: INVESTMENTS PURCHASED SECOND QUARTER FISCAL YEAR 2002/2003 CALL TYPE AMOUNT MATURITY YIELD DATE FEDERAL SECURITIES FFCB $ 6,000,000 12/27/2004 2.350% 6/27/03 In the most recent quarter the average maturity for the Federal Security portion of the portfolio increased to 2.5 years, due to the purchase of the longer term securities noted above. It is important to note that this relates solely to the portion of the portfolio that has investments with a stated term. The City maintains adequate funds in more liquid investments, which are deemed sufficient to meet cash flow needs. DETAILED LISTING OF PRIMARY PORTFOLIO Government and Agency Securities represent 42% of the Primary Portfolio. A detailed listing of each security is provided in Item 1. The market value of Federal Securities can fluctuate daily and values have been provided as reported by Union Bank of California as of December 31, 2002. The City portfolio assumes that the investments will be held to maturity and there is not an active attempt made to trade existing securities. The City has staggered the maturity dates within the portfolio and it is not anticipated that these funds will need to be called by the City prior to maturity. The Morgan Stanley Dean .Witter US Government Securities Mutual Fund Investment r~presents 2% of the City's total portfolio. During the 2002-2003 Fiscal Year the City has received to date $34,418 in dividends from this investment, resulting in an annualized yield of 4.317%. Since October 1999, the mutual fund may be redeemed without sales charges. COMPOSITION OF PORTFOLIO - SOURCE OF FUNDS To provide an overview of the portfolio, the table below shows the total investment balance as of December 31, 2002 by source. Comparison information is also shown for the previous quarter. Note that 42% of the investment balance represented restricted Impact Fee Funds. It is important to keep in mind that this type of report is merely a snapshot on a particular day. Revenues as well as expenditures are not processed in equal monthly installments. PORTFOLIO COMPOSITION BY SOURCE OF FUNDS Current Quarter Prior Quarter 12/31/2002 % of 9/30/2002 % of Balance Total Balance Total General Fund $41,386,178 46% $41,842,705 47% Restricted - Special Revenue Funds $3,891,054 4% $1,269,608 1% (I.e. Gas Tax, Special Taxes) Restricted - Assessment District Funds $629,857 1% $389,483 0% (i.e. Landscape Maint & Debt Service) . Restricted - Impact Fees $37,622,792 42% $41,206,331 45% Internal Service / Replacement Funds $6,659,639 7% $6,390,370 7% TOTAL $90,189,520 100% $91,098,497 100% CITY OF DUBLIN QUARTERLY INVESTMENI' REPORT 2nd QUARTER FY 2002-2003 SECTION 1 PRIMARY INVESTMENT PORTFOLIO CITY OF DUBLIN DETAILED LISTING OF INVESTMENTS ~ ~ /~ INCLUDING RATE OF RETURN December 31, 2002 COUPON BOOK AND MATURITY VALUE AT INTEREST MARKET INVESTMENT 1 ST CALL DATE DATE MATURITY RATE YIELD VALUE FEDERAL SECURITIES FHLB 2/14/2003 1 1,000,000 7.000% 7.010% 1,006,560 FHLB 9/2/2003 1 1,000,000 5.627% 6.910% 1,028,750 FNMA 11/14/2003 1 1,000,000 4.750% 6.920% 1,029,690 FHLB 12/15/2004 2 3,000,000 3.875% 4.240% 3,120,930 FNMA 6/27/03 12/20/2004 2 1,000,000 3.800% 3.800% 1,012,190 FHLB 6/27/03 12/27/2004 2 6,500,000 3.815% 3.815% 6,575,140 FFCB 6/27/03 12/27/2004 5 6,000,000 2.350% 2.350% 6,026,280 FHLB 2/14/03 2/14/2005 3 3,000,000 3.250% 3.250% 3,005,640 FHLB 7/18/03 7/18/2005 3 3,000,000 5.220% 5.220% 3,060,930 FHLB 1/17/03 1/17/2006 4 5,000,000 5.420% 5.420% 5,007,800 FHLB 2/14/03 8/14/2006 4 3,000,000 4.000% 4.000% 3,008,430 FHLMC 1/3/2007 5 500,000 6.525% 5.200% 573,595 FFCB 1/23/2007 5 421,000 4.600% 5.200% 449,813 FHLB 2/15/2007 5 4,000,000 4.875% 5.140% 4,307,520 TOTAL FEDERAL SECURITIES $38,421,000 4.324% $39,213,268 CERTIFICATES OF DEPOSIT - FDIC INSURED United California Bank 12/9/2002 1 99,000 6.000% 6.000% 99,000 TOTAL CERTIFICATES OF DEPOSIT $99,000 6.000% $99,000 MUTUAL FUNDS Nations Bank Government Reserves $5,006,000 1.266% $3,703,000 Capital Fund Union Bank U.S. Govt Securities $5,507,031 0.850% $5,507,031 Morgan Stanley Dean Witter U.S. Govt Securities See Note 1 4.317% (2) $1,691,351 TOTAL MUTUAL FUNDS 1.479% $10,901,382 POOLED PUBLIC AGENCY INYESTMENTS State of CA.- Local Agency Investment Fund (LAIF) $39,975,870 2.310% $39,975,870 TOTAL INVESTED PORTFOLIO 3.057% $90,189,520 NOTES: (1) A Mutual Fund investment does not have a stated date of maturity and shares may be sold at any time. The share price at the time of a sale may be either higher or lower than the original cost. (2) Interest Rate shown is based on dividends received this fiscal year to date, which are annualized and then divided by the original investment. Maturity Schedule Summary of Portfolio (Assuming None of Securites are called prior to Maturity) Money Market Funds/LAIF (1 day liquidity) $50,877,252 55% Maturing in 1 year or less $3,164,000 4% Maturing in 1-2 years $10,708,260 12% Maturing in 2-3 years $6,066,570 7% Maturing in 3-4 years $8,016,230 9% Maturing in 4-5 years $11,357,208 13% Total Portfolio $90,189,520 100% 1/21/2005 2:50 PM ITEM 1 CITY OF DUBLIN SUMMARY OF INVESTMENT PORTFOLIO COMPARISON BY INVESTMENT TYPE December 31, 2002 BOOK AND MARKET % OF MATURITY TYPE OF INSTRUMENT FACE VALUE VALUE PORTFOLIO YEARS Federal Home Loan Bank (FHLB) 36,500,000 37,160,170 40.3% 2.5 Federal Farm Credit Bureau (FFCB) 421,000 449,813 0.5% 4.1 Federal National Mortgage Assn (FNMA) 1,000,000 1,029,690 1.1% 0.9 Federal Home Loan Mortgage Corporation (FHLMC) 500,000 573,595 0.6% 4.0 SUB -TOTAL GOVT/AGENCY 38,421,000 39,213,268 O) 42.4% 2.5 Certificates of Deposit - FDIC Insured 99,000 99,000 0.1% -0.1 Mutual Funds Morgan Stanley Dean Witter U.S. Govt Securities 1,594,497 1,691,351 (z) 1.8% N/A Union Bank U.S. Govt Securities 5,507,031 5,507,031 6.1% N/A Nations Bank Government Reserves Capital Fund 5,006,000 5,006,000 5.5% N/A LAIF 39,975,870 39,975,870 44.1% N/A GRAND TOTAL $90,603~398 $91,492,520 100.0% NOTES: (1) The City intends to hold the investments until maturity or until market values equal or exceed their face value. (2) As a mutual Fund shares can typically be liquidated at any time. The weighted average maturity stated in this chart was calculated by Dean Witter based upon all investment instruments owned by the U.S. Government Securities Mutual Fund. 1/24/2003 2:14 PM ITEM 2 CITY OF DUBLIN QUARTERLY INVESTMENT REPORT 2nd QUARTER FY 2002-2003 SECTION 11 LISTING OF SUPPLEMENTAL MONIES UNDER CITY POSSESSION AND/OR CONTROL · OPERATING FUNDS SPECIAL FUNDS HELD BY TRUSTEES City of Dublin Report of Operating Funds On Hand As of December 31, 2002 In accordance with the California Government Code, the City Treasurer must disclose on a quarterly basis all monies in its possession. Monies considered invested, and not immediately necessary for current operations, are presented in a separate listing as part of the quarterly report. In the case of Operating Funds in bank accounts, the amount presented relates to the balance reported by the Financial Institution. IT IS IMPORTANT TO NOTE THAT THIS AMOUNT MAY REFLECT FUNDS REQUIRED TO COVER PAYMENTS ALREADY ISSUED AND CHECKS WHICH HAVE NOT CLEARED AS OF THE LAST DAY OF THE QUARTER. Therefore, these balances will fluctuate throughout the year. These funds are not subject to a specified maturity and the par value would be equivalent to the amount stated. Miscellaneous Cash Balance Non-Categorized - Cash 12/31/2002 Cash Regisers/Petty Cash - $950.00 City Petty Cash - Shannon Center $200.00 Subtotal $1,150.00 OPERATING CASH BALANCES - FINANCIAL INSTITUTIONS Balance 12/31/2002 Annualized Rate of Interest BANK OF AMERICA- Collateralized Public Money Deposits In Accordance With $357,780 .5% California Government Code NATIONS BANK U.S. Treasury Reserves Adviser $2,635,763 1.0084% Account (Sweep Account connected to Bank of America Deposits listed above) Cai Fed- Regular Savings Account: FDIC Insured $2,577 .75% Grand Total Amount Cash Balances: $2,996,120 SPECIAL FUNDS HELD BY TRUSTEES CITY OF DUBLIN DETAILED LISTING OF INVESTMENTS INCLUDING RATE OF RETURN FOR THE QUARTER ENDING DECEMBER 31, 2002 COUPON MATURITY VALUE AT INTEREST BOOK MARKET DATE MATURITY RATE YIELD VALUE VALUE MUTUAL FUNDS Dublin Blvd Assessment District First American Govt Obligation Fund See Note 1 0.94% $171,622 · $171,622 NOTES: (1) A Mutual Fund does not have a stated maturity date and shares can be sold at any time.