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Home My WebLink About4.04 InvestRpt1stQtr03-04CITY. CLERK File# 320-30 AGENDA STATEMENT " CITY couNCIL MEETING DATE: O'ctober 21,2003 SUBJECT: City Treasurer's Investment Report for 1 st Quarter 2003/2004 Report Prepared by Carole A. Perry, Administrative Services Director and Fred ~ Marsh, Finance Manager ATTACHMENTS: Quarterly Investment Report (September 30, 2003) Section I - Section II - Primary Investment Portfolio Listing of Supplemental Monies Under City Possession and/or Control RECOMMENDATION:~ ~Receive Report DESCRIPTION: The attached Investment Report details the City's investments as of September 30, 2003, 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 first quarter of Fiscal Year 2003/2004 are discussed in the staff report below. INVESTMENT ACTIVITY IN FIRST QUARTER FISCAL YEAR 2003/2004 During the First Quarter two 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 FIRST QUARTER FISCAL YEAR 2003/2004 CURRENT TYPE AMOUNT MATURITY YIELD Matured Federal Securities FHI~P, $!,000,000 9/2/2003 5.580% Called Federal Securities FHLB $3,000,000 7/18/2005 5.210% 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 used to purchase six new securities during the period, as summarized in the table on the following page: G:\Investments\Sept 2003~,genda staff report3.doc COPIES TO: ITEM NO. INVESTMENTS PURCHASED FIRST QUARTER FISCAL (EAR 2003/2004 CURRENT CALL TYPE AMOUNT MATURITY YIELD DATE FEDERAL SECURITIES FHLB $2,000,000 8/26/2005 2.300% 8/26/2004 FHLB $5,000,000 9/18/2006 3.240% 12/18/2003 FHI.B $5,000,000 3/26/2007 3.420% 3/26/2004 FI-II .MC $ 5,000,000 9/10/2007 3.570% 9/10/2004 FHLMC $3,000,000 9/19/2007 3.970% 12/18/2003 FHLB $1,000,000 9/18/2008 4.410% 12/18/2003 In the most recent quarter the average maturity for the Federal Security portion of the portfolio remained at 3.4 years. 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. DETAIl JED LISTING OF PRIMARY PORTFOLIO Government and Agency Securities represent 48% of the Primary Portfolio. A detailed listing of each security is provided in Section 1. The market value of Federal Securities can fluctuate daily and values have been provided as reported by Union Bank of California as of September 30, 2003. 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 represents 2% of the City's total portfolio. During the 2002/2003 Fiscal Year the City has received to date $9,616 in dividends from this investment, resulting in an annualized yield of 3.618%. 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 September 30, 2003 by source. Comparison information is also shown for the previous quarter. Note that approximately 36% of the investment balance represents 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 General Fund Restricted - Special Revenue Funds (I.e. Gas Tax, Special Taxes) Restricted - Assessment District Funds (i.e. Landscape Maint & Debt Service) Restricted - Impact Fees Internal Service / Replacement Funds TOTAL 9/30/2003 %of Balance Total $49,265,074 52.3% $3,535,553 3.8% $382,796 0.4% $33,670,375 35.8% $7,246,977 7.7% $94,100,775 100.0% 6/30/2003 % of Balance Total $46,136,452 52% $3,097,043 4% $662,426 1% $30,250,010 35% $6,967,190 8% $87,113,121 100% CHANGES IN THE TOTAL PORTFOLIO YIELD FROM THE PREVIOUS REPORT The total amount shown as invested in the Primary Investment Portfolio is $6,987,654 more than the amount shown at June 30, 2003, primarily due to sales tax advances, impact fees from new development and grant payments received during the quarter. Overall, the combined rate for the total portfolio increased from 2.194% at June 30, 2003 to 2.472% at September 30, 2003. The increase was attributable to purchase of several new federal securities noted above. The quarterly average for the City's LAIF investment was 1.64% as of September 30, 2003, which was lower than the 1.77% rate recorded for the quarter ending June 30, 2003. LAIF is a liquid investment, and the current LAIF rate remains favorable compared to rates offered on investments, which have less flexibility. The schedule of investments, including the dates of maturity, contains adequate cash flow liquidity to meet anticipated expenditures over the next six months. The investments and the schedule of investments are in compliance with the City's investment policy and all applicable laws and regulations. It should be noted that the annual review of the City's Investment Policy will be presented to Council in a later report. CITY OF DUBLIN QUARTERLY INVESTMENT REPORT 1st QUARTER FY 2003-2004 SECTION 1 PRIMARY INVE S TMENT PORTFOLIO CITY OF DUBLIN DETAILED LISTING OF INVESTMENTS INCLUDING RATE OF RETURN September 30, 2003 INVESTMENT 1ST CALL DATE COUPON BOOK AND MATURITY VALUE AT INTEREST CURRENT MARKET DATE MATURITY RATE YIELD VALUE FEDERAL SECURITIES FNMA FHLB FHLB 8/26/04 FHLB 9/30/03 FHLB 12/18/03 FHLMC FFCB FHLB FHLB 3/26/04 FHLMC 9/10/04 FHLMC 12/18/03 FHLB 12/24/03 FHLB 9/30/03 FHLB 12/18/03 TOTAL FEDERAL SECURITIES 11/14/2003 1 1,000,000 4.750% 4.730% 1,004,380 12/15/2004 2 3,000,000 3.875% 3.760% 3,089,070 8/26/2005 2 2,000,000 2.325% 2.300% 2,020,760 6/30/2006 3 5,000,000 2.250% 2.250% 5,007,800 9/18/2006 3 5,000,000 3.250% 3.240% 5,020,300 1/3/2007 4 500,000 6.525% 5.760% 566,405 1/23/2007 4 421,000 4.600% 4.280% 452,444 2/15/2007 4 4,000,000 4.875% 4.530% 4,305,000 3/26/2007 4 5,000,000 3.465% 3.420°,4 5,060,950 9/10/2007 4 5,000,000 3.650% 3.570% 5,112,750 9/19/2007 4 3,000,000 4.000% 3.970% 3,019,650 6/24/2008 5 9,000,000 3.100% 3.110% 8,957,790 6/30/2008 5 1,000,000 3.200% 3.200% 998,440 9/18/2008 5 1,000,000 4.440% 4.410% 1,006,560 $44,921,000 3.413% $45,622,299 MUTUAL FUNDS Nations Bank Government Reserves Capital Fund Union Bank U.S. Govt Securities Morgan Stanley Dean Witter U.S. Govt Securities TOTAL MUTUAL FUNDS $6,583,000 0.895% $6,583,000 $224,464 0.562% $224,464 See Note 1 3.618% (2) $1,694,938 1.403% $8,502,402 POOLED PUBLIC AGENCY INVESTMENTS State of CA.- Local Agency Investment Fund (LAIF) $39,976,074 1.640% $39,976,074 2.472% $94,100,775 TOTAL INVESTED PORTFOLIO 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) Maturing in 1 year or less Maturing in 1-2 years Maturing in 2-3 years Maturing in 3-4 years Maturing in 4-5 years Total Portfolio $48,478,476 51% $1,004,380 1% $5,109,830 5% $10,028,100 11% $18,517,199 20% $10,962,790 12% $94,100,775 100% 10/3,2003 4:52 PM ITEM I CITY OF DUBLIN SUMMARY OF INVESTMENT PORTFOLIO COMPARISON BY INVESTMENT TYPE September 30, 2003 TYPE OF INSTRUMENT Federal Home Loan Bank (FHLB) Federal Farm Credit Bureau (FFCB) Federal National Mortgage Assn (FNMA) Federal Home Loan Mortgage Corporation (FHLMC) SUB -TOTAL GOVT/AGENCY Mutual Funds Morgan Stanley Dean Witter U.S. Govt Securities Union Bank U.S. Govt Securities Nations Bank Government Reserves Capital Fund BOOK AND MARKET % OF VALUE PORTFOLIO MATURITY YEARS 35,466,670 37.5% 3.4 452,444 0.5% 3.3 1,004,380 1.1% 0.1 8,698,805 9.1% 3.9 45,622,299 O) 48.1% 1,694,938 (2) 1.7% 3.4 N/A 224,464 0.2% N/A 6,583,000 7.1% N/A LAIF 39,976,074 42.9% GRAND TOTAL $94,100,775 100.0% NOTES: N/A (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 chl by Dean Witter based upon all investment instruments owned by the U.S. Government Securities Mutual Fund. ,o,6,2oo3,~:~4 ^,~ ITEM 2 CITY OF DUBLIN QUARTERLY INVESTMENT REPORT 1st QUARTER FY 2003-2004 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 September 30, 2003 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 Non-Categorized - Cash Cash Registers/Petty Cash - City Petty Cash - Shannon Center Subtotal Balance 9/30/2003 $1,100.00 $200.00 $1,300.00 OPERATING CASH BALANCES - FINANCIAL INSTITUTIONS BANK OF AMERICA- Collateralized Public Money Deposits In Accordance With California Government Code Balance 9/30/2003 $168,363 Annualized Rate of Interest .5% NATIONS BANK U.S. Treasury Reserves Adviser Account (Sweep Account connected to Bank of America Deposits listed above) $773,801 .655% Cai Fed- Regular Savings Account: FDIC Insured $3,586 .4% Grand Total Amount Cash Balances: $945,750 SPECIAL FUNDS HELD BY TRUSTEES CITY OF DUBLIN DETAILED LISTING OF INVESTMENTS INCLUDING RATE OF RETURN FOR THE QUARTER ENDING SEPTEMBER 30, 2003 MUTUAL FUNDS Dublin Blvd Assessment District First American Govt Obligation Fund COUPON MATURITY VALUE AT INTEREST DATE MATURITY RATE YIELD BOOK VALUE MARKET VALUE See Note 1 0.51% $172,487 $172,487 NOTES: (1) A Mutual Fund does not have a stated maturity date and shares can be sold at any time.