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02-04-2003 - December 2002 Treasurer's Reportr: City of West Covina Memorandum AGENDA Item No. 6" S Date February 4, 2003 TO: Andrew G. Pasmant, City Manager and City Council FROM: Thomas Bachman, Director Finance Department SUBJECT: DECEMBER 2002 TREASURER'S REPORT RECOMMENDATION: It is recommended the City Council receive and file this report. DISCUSSION: Section 53646 of the Government Code requires a city's treasurer or chief fiscal officer to submit quarterly reports to their legislative body. This report is to include the type of investment, issuer, date of maturity, par. and dollar amount invested on all securities, investments and money held by the local agency. It must also include a statement that the portfolio is in compliance with the City's investment policy or manner in which it is not in compliance and note the ability of the local agency to meet its.expenditure requirements for the next six months or provide an explanation as to why sufficient money may not be available. On January 1, 2001, AB943 took effect, amending the law to also require local agencies to submit reports to the State of California for the second and fourth quarters of each year. The December 2002 report will be submitted to the State. Treasurer's reports are submitted to the West Covina City Council monthly. The December Report shows the City's portfolio increased from $59,178,927.26 on November 30, 2002 to $62,168,399.08 on December 31, 2002. Beginning with the May 2001 report, average maturity information has been provided for investments in the City's portfolio. The overall average maturity of the portfolio is 1689 days or approximately four years. This unusually long maturity is caused by two, long term, high interest investments made in the early 1980s, which constitute approximately twenty two percent of the portfolio. Approximately forty six percent of the portfolio is on deposit in the Local Agency Investment Fund (LAIF). These funds are completely liquid since the City could withdraw them at any time. The remaining thirty two percent of the portfolio has an average maturity of less than two years. An explanation of the Treasurer's report features has been attached. Bond Detail Report: The December report also includes a Bond Detail Report. This report shows how Fiscal Agents are investing City, Redevelopment Agency and Public Financing Authority cash, which they hold to service various debts. This information is reported to the City Council quarterly. Prepared by: Dennis Swink Reviewed/Approved by: Thomas Bachman Controller Finance Director How to Read the Treasurer's Report Summary Page. The monthly treasurer's report is comprised of two documents. The first provides a one -page summary of investments (Attachment -A). • A-1 provides a general description of investment type. • A-2 shows the balances for each investment type as of the end of the prior month. • A-3 shows how much was deposited in each category during the month. • A-4 shows withdrawals. • A-5 shows the balances in each investment category at the end of the month. • A-6 shows what percentage of the portfolio is invested in each investment category. • A-7, located in the left hand margin denotes an asterisked note, which states: "NEGATIVE BALANCE REFLECTS OUTSTANDING CHECKS". This refers to the negative bank balances shown in columns A-2 and A-5. These negative numbers are the result of a sweep account the City has set up with Wells Fargo bank. This enables us to keep the majority of our funds on deposit in an interest bearing account until outstanding checks clear the bank. When a check does clear, the required funds are automatically swept in from the interest bearing account into the checking account. With this arrangement, it is not uncommon for the City to have outstanding checks in an amount that exceeds the money on deposit in our Wells Fargo Checking Accounts. When this happens, these accounts show a negative balance. This should not be a concern as long as the amount on- deposit in the Wells Fargo Sweep account is sufficient to cover the outstanding checks. • A-8, located in the left hand margin highlights the statements regarding compliance with the City investment policy and sufficient cash flow available to meet expenditures for the next six months. As discussed earlier, these statements are required. • A-9 in the left hand margin and A-10 provide'a kind of scorecard comparing the interest earned to six month treasury bills Portfolio Details. The second part of the report provides detailed information on individual investments as illustrated in Attachment-B. • B-1 lists the investment number assigned by City staff for tracking purposes. • B-2 lists investment type. (This information is required.) These are shown in their abbreviated form. The full titles of these abbreviations are in A-1 on the summary page. • B-3 lists the issuer. (This information is also required.). • B-4 shows the date of purchase. • B-5 shows the maturity date. (This information is required.) • B-6 shows the average days to maturity for each class of investment. • B-7 lists the CUSIP number. • B-8 lists the interest rate. • . B-9 lists the yield. • B-10 lists the cost of each investment. (This information is required.) • B-11 lists the PAR value. (This information is required.) • B-12 lists the market value as of the end of the current month. (This information is required.) • B-13 lists the market value as of the end of the previous month. • B-14 tells the reader that the market values are provided by Union Bank. A-7 A-8 A-9 CITY OF WEST COVINA STATEMENT OF TREASURER'S ACCOUNTABILITY JULY 31, 2001 A-1 A-2 A-3 A-4 A-5 A-6 TYPES OF DEPOSITS: JUNE 30 DEPOSITS WITHDRAWALS . July 31 CHECKING ACCOUNTS WELLS FARGO GENERAL CHECKING $ 110,463.49 13,383,165.05 $ 13,365,850.43 $ 127,778.11 WELLS FARGO GENERAL AUTO & LIABILITY (8,471.37) * 21,230.41 49,335.23 (36,576.19) ` WELLS FARGO WORKER'S COMPENSATION (40,325.41) * 74,199.32 106,744.54 (72,870.63) WELLS FARGO PAYROLL (231,925.22) * 2,341,194.25 2,184,280.66 (75,011.63) WELLS FARGO BAIL/FINE - _ WELLS FARGO CDBG DEFERRED LOAN PROGRAM 120,913.84 199.42 121,113.26 PACIFIC WESTERN NAT BANK DEFERRED LOAN PROGRAM 110,542.95 200,124.35 310,667.30 SUB -TOTAL $ 61,198.28 $ 16,020,112.80 $ 15,706,210.86 $ 375,100.22 0.543%' OTHERINVESTMENTS: WELLS FARGO SWEEP $ 2,982,024.45 $ 5,494,859.08 $ 6,640,255.50 $ 1,836,628.03 2.658% ESCROW ACCOUNT 37,569.28 111.36 5.00 37,675.64 0.055% FEDERAL HOME LOAN BANK (FHLB) 6,959,010.00 - - 6,959,010.00 10.070% FEDERAL FARM CREDIT BANK (FFCB) 3,486,225.00 2,990,790.00 495,435.00 0.717% FEDERAL NATIONAL MORTGAGE ASSOCIATION (FNMA) 6,695,593.75 - 1,000,000.00 5,695,593.75 8.242% FEDERAL HOME LOAN MORTGAGE CORPORATION (FHLMC) 10,199,962.50 - - 10,199,962.50 14.759% CORPORATE MEDIUM TERM NOTES (MTN) 155 9 - - 9,988,553.47 14.453% LOCAL AGENCY INVESTMENT FUND - CITY (LAIF) P372,959.35 364,609.87 30,000,000.00 43.410% LOCAL AGENCY INVESTMENT FUND - W.C.P.F.A. (LAIF) 1 3 1,826.66 - 139,861.52 0.202% LOS ANGELES COUNTY POOL (LACIP) 3,303,408.67 500,000.00 3,380,764.18 4.8929/6 SUB -TOTAL 71,055,979.34 $ 9,173,165.12 $ 11,495,660.37 $ 68,733,484.09 99.457% TOTAL $ 71,117,177.62 $ 25,193,277.92 $ 27,201,871.23 $ 69,168,584.31 100% *NEGATIVE BALANCE REFLECTS OUTSTANDING CHECKS It has been verified that this Investment portfolio is in conformity with the City of West Covina's investment policy which was approved by the City Council on May 1, 2001. The investment portfolio provides sufficient cash flow liquidity to meet estimated expenditures for the next six months. This report is accurate with respect to all information received as of August 31 EARNED INTEREST YIELD THIS PERIOD: 5.565% A-10 SIX-MONTH TREASURY BILL YIELD: 3.45% REVIEWED BY: - PREPARED BY: Dennis Swink, City Controller SUBMITTED BY: Artie Fields, Acting Finance Director Angel F. Patena, Departmental Aide APPROVED BY: Marian V. Smithson, City Treasurer • City of West Covina Portfolio Details July 31, 2001 B-1 B-2 B-3 B-4 B-5 B-6 B-7 B-8 B-9 B-10 B-11 B-12 B-13 AVERAGE 7/31 /2001 6/30/2001 INVESTMENT INVESTMENT I ISSUER PURCHASE I MATURITY DAYS TO CUSIP RATE I YIELD COST I PAR I MARKET I MARKET NUMBER TYPE DATE DATE MATURITY VALUE' VALUE* 5485 FFCB U.S. GOVERNMENT AGENCY 03/02/00 07/02/01 31331HZF7 5.8750 5486 FFCB U.S. GOVERNMENT AGENCY 03/03/00 07/27/01 31331HD46 6.5500 5488 FFCB U.S. GOVERNMENT AGENCY 03/03/00 10/01/01 31331HG35 6.0000 5465 FFCB U.S. GOVERNMENT AGENCY 01/14/99 01/14/02 31331RT96 5.4000 61 5487 FHLB U.S. GOVERNMENT AGENCY 03/08/00 09/17/01 0 5.8750 5489 FHLB U.S. GOVERNMENT AGENCY 03/08/00 11/15/0 E8 6.0000 5496 FHLB U.S. GOVERNMENT AGENCY 06/13/00 3133M9FE7 6.0000 5444 FHLB U.S. GOVERNMENT AGENCY / ff/P2 3133M34N2 6.0700 5445 FHLB U.S. GOVERNMENT AGENCY / 3133M3DQ5 6.0050 5450 FHLB U.S. GOVERNMENT AGENCY / 07/07/03 3133M4SW4 6.0000 5473 FHLB U.S. GOVERNMENT AGENCY 02/24/99 02/24/04 3133M7KE5 5.7550 460 4770 FHLMC U.S. GOVERNMENT AGENCY 06/01/86 06/01/16 313400MC4 8.2500 5341 2454 FNMA U.S. GOVERNMENT AGENCY 12/10/85 "12/10/15 313586UB3 10.3500 5451 FNMA U.S. GOVERNMENT AGENCY 07/09/98 07/09/03 31364FX22 5.9000 5475 FNMA U.S. GOVERNMENT AGENCY 07/15/99 07/15/04 31364G2R9 6.5300 3831 4693 , LACIP LOS ANGELES COUNTY TREASURER 04/20/92 12/31/99 See Note N/A 4.6300 3914 LAIF STATE OF CALIFORNIA 10/19/89 12/31/99 173 N/A 4.6350 5273 LAIF STATE OF CALIFORNIA 12/01/93 12/31/99 See Note N/A 4.6350 5476 MNYMKT MARQUETTE NATIONAL BANK 04/01/99 04/01/04 See Note N/A 3.5500 5.9500 Matured 07-02-01 6.5900 Matured 07-27-01 6.0800 495,435.00 5.5500 Called 07-14-01 495,435.00 1,000,000.00 Matured 07-02-01 Matured 07-02-01 1,000,000.00 Matured 07-27-01 Matured 07-27-01 500,000.00 501,955.00 501,875.00 1,000,000.00 Called 07A4-01 Called 07-14-01 3,500,000.00 501,955.00 501,875.0� 5.9600 989,190.00 1,000,000.00 1,002,340.00 1;002,810.00 6.0500 989,360.00 1,000,000.00 1,007,030.00 1,007,500.00 6.9792 980,460.00 1,000,000.00 1,024,060.00 1,020,780.00 6.2100 1,000,000.00 1,000,000.00 1,025,940.00 1,023,750.00 6.2000 1,000,000.00 1,000,000.00 1,032,500.00 1,026,410.00 6.2100 1,000,000.00 1,000,000.00 1,035,000.00 1,027,030.00 6.0700 1,000,000.00 1,000,000.00 1,001,250.00 1,002,340.00 6,959,010.00 7,000.000.00 7,128,120.00 7,110,620.00 7.6100 10,199,962.50 9,555,000.00 11,567,474.10 11,127,084.15 10,199,962.50 9,555,000.00 11,567,474.10 11,127,084.15 8.1400 3,688,593.75 3,000,000.00 4,235,160.00 4,086,090.00 6.1600 Called 07-09-01 1,000,000.00 Called 07-09-01 Called 07-09-01 6.7500 2,007,000.00 2,000,000.00 2,049,380.00 2,045,000.00 5,695,593.75 6,000,000.00 6,284,540.00 6,131,090. 4.6300 3,380,764.18 3,380,764.18 3,380,764.18 3,380,764.18 4.6350 30,000,000.00 30,000,000.00 30,000,000.00 30,000,000.00 4.6350 139, 861.52 139, 861.52 139, 861.52 139, 861.52 3.7200 37,675.64 37,675.64 37,675.64 37,675.64 City of West Covina Portfolio Details July 31, 2001 AVERAGE 7/31/2001 6/30/2001 INVESTMENT INVESTMENT ISSUER PURCHASE MATURITY DAYS TO CUSIP RATE YIELD COST PAR MARKET MARKET NUMBER TYPE DATE DATE MATURITY VALUE` VALUE` 5457 MTN NATIONSBANK CHARLOTTE.NC 08/03/98 08/01/01 63858JEE5 5.8500 5.9700 5463 MTN MERRILL LYNCH & CO INC 01/14/99 12/10/01 59018SC85 6.1000 6.2200 5499 MTN ASSOC. CORP OF N.A. 06/16/00 09/30/02 045906KB9 6.7300 7.3293 5460 MTN MERRILL LYNCH & CO INC 10/05/98 02/12/03 590188HZ5 6.0000 6.2000 5462 MTN SALOMON SMITH BARNEY HLDGS 1 10/14/98 05/15/03 79549BCL9 6.2500 6.4900 5491 MTN COMMERCIAL CREDIT COMPANY 04/24/00 08/01/04 201615DS7 6.5000 6.7500 5493 MTN GENERAL ELECTRIC CAPITAL CORP 06/15/00 02/15/05 36962GUM4 5494 MTN FORD MOTOR CREDIT CO 06/15/00 03/15/05 345397 1.2aft7.1701 7.6000 5495 MTN HEWLETT-PACKARD CO 06/15/00 06/15/05 4 .1 7.1792 STOCK " SOUTHWEST WATER COMPANY 04/16/86 001-751-84533110 N/A 1551 TOTALS: B-14 ` MARKET VALUES HAVE BEEN PROVIDED BY UNION BANK. 1,000,000.00 1,000,000.00 1,000,000.00 1,001,480.00 1,015,060.00 1,000,000.00 1,009,130.00 1,010,340.00 987,540.00 1,000,000.00 1,028,940.00 1,028,490.00 2,015,010.00 2,000,000.00 2,050,640.00 2,034,420.00 1,000,950.00 1,000,000.00 1,029,220.00 1,020,280.00 972,370.00 1,000,000.00 1,039,310.00 1;023,430.00 1,002,970.00 1,000, 000.00 1,078,280.00 1,061,590.0 995,903.47 1,000,000.00 1,057,520.00 1,039,040.46 998,750.00 1,000,000.00 1,049,100.00 ;1,034,680.00 9,988,553.47 10,000,000.00 10,342,140.00 #REF! Sold 07-11-01 Sold 07-11-01 Sold 07-11-01 Sold 07-11-01 66,896,856.06 69,613,301.34 69,382,530.44 #REF! Note: Average Maturity - Liquid, variable rate interest accounts including the Wells Fargo Sweep, LACIP and the Marquette Money Market were not included in calculation of average maturity because the City has no control over the term of underlying investments and funds can be withdrawn at any time. LAIF was included because excluding this sizeable balance skews the overall average. ". Southwest Water Company was sold in July 2001. CITY OF WEST COVINA STATEMENT OF TREASURER'S ACCOUNTABILITY DECEMBER 31, 2002 TYPES OF DEPOSITS: NOVEMBER 30 DEPOSITS WITHDRAWALS DECEMBER 31 CHECKING ACCOUNTS WELLS FARGO GENERAL CHECKING $ 739,645.38 $ 21,436,082.85 $ 21,607,941.91 $ 567,786.32 WELLS FARGO BANK GEN AUTO & LIABILITY - - - _ PACIFIC WESTERN NAT BANK GEN AUTO & LIABILITY (7,104.59) " 57,568.73 76,297.80 (25,833.66) " PACIFIC WESTERN NAT BANK WORKER'S COMPENSATION 99,616.83 1,209.58 109,722.89 (8,896.48) WELLS FARGO PAYROLL (246,793.28) " 2,785,877.35 2,674,860.60 (135,776.53) WELLS FARGO BAIUFINE - WELLS FARGO CDBG DEFERRED LOAN PROGRAM 121,487.80 - - 121,487.80 PACIFIC WESTERN NAT BANK DEFERRED LOAN PROGRAM 769.13 82,563.01 82,573.01 759.13 PACIFIC WESTERN NAT BANK CITY COUNCIL DEBIT CARDS 16,729.14 83.49 924.50 15,888.13 SUB -TOTAL $ 724,350.41 $ 24,363,385.01 $ 24,552,320.71 $ 535,414.71 0.861% OTHERINVESTMENTS: WELLS FARGO SWEEP $ 658,514.20 $ 9,659,297.98 $ 9,202,863.43 $ 1,114,948.75 1.793% FEDERAL HOME LOAN BANK (FHLB) 2,000,000.00 - - 2,000,000.00 3.217% FEDERAL NATIONAL MORTGAGE ASSOCIATION (FNMA) 3,688,593.75 - - 3,688,593.75 5.933% FEDERAL HOME LOAN MORTGAGE CORPORATION (FHLMC) 10,199,962.50 - - 10,199,962.50 16.407% CORPORATE MEDIUM TERM NOTES (MTN) 6,985,953.47 - - 6,985,953.47 11.237% LOCAL AGENCY INVESTMENT FUND - CITY (LAIF) 25,836,150.46 4,200,000.00 1,500,000.00 28,536,150.46 45.901% LOCAL AGENCY INVESTMENT FUND - W.C.P.F.A. (LAIF) 145,668.26 - 145,668.26 0.234% LOS ANGELES COUNTY POOL (LACIP) 8,939,734.21 21,972.97 - 8,961,707.18 14.415% SUB -TOTAL $ 58,454,576.85 $ 13,881,270.95 $ 10,702,863.43 $ 61,632,984.37 99.139% TOTAL $ 59,178,927.26 $ 38,244,655.96 $ 35,255,184.14 $ 62,168,399.08 100% 'NEGATIVE BALANCE REFLECTS OUTSTANDING CHECKS It has been verified that this investment portfolio is in conformity with the City of West Covina's investment policy which was approved by the City Council on February 19, 2002. The investment portfolio provides sufficient cash flow liquidity to meet estimated expenditures for the next six months. This report is accurate with respect to all information received as of January 24, 2002. EARNED INTEREST YIELD THIS PERIOD: 4.082% SIX-MONTH TREASURY BILL YIELD: 1.24% WED BY: P EP B Y Dennis Swink, City Controller Angel F. P tena, Revenue Services Supervisor SUBMITTED BY: Thomas Bachman, Finance Director • APP VED BY: Marian V. Smi son, City Treasurer • • City of West Covina Portfolio Details December 31, 2002 AVERAGE 12/31 /2002 11 /30/2002 INVESTMENT INVESTMENT ISSUER PURCHASE MATURITY DAYS TO CUSIP RATE YIELD COST PAR MARKET MARKET NUMBER TYPE DATE DATE MATURITY VALUE` VALUE` 5445 FHLB U.S. GOVERNMENT AGENCY ' 04/23/98 5450 FHLB U.S. GOVERNMENT AGENCY 07/07/98 �4770 FHLMC U.S. GOVERNMENT AGENCY 06/01/86 2454 FNMA U.S. GOVERNMENT AGENCY 12/10/85 4693 LACIP LOS ANGELES COUNTY TREASURER 04/20/92 3914 LAIF STATE OF CALIFORNIA 10/19/89 5273 LAIF STATE OF CALIFORNIA 12/01/93 5460 MTN MERRILL LYNCH & CO INC 10/05/98 5462 MTN SALOMON SMITH BARNEY HLDGS I 10/14/98 5491 MTN COMMERCIAL CREDIT COMPANY 04/24/00 5493 MTN GENERAL ELECTRIC CAPITAL CORP 06/15/00 5494 MTN FORD MOTOR CREDIT CO 06/15/00 5495 MTN HEWLETT-PACKARD CO 06/15/00 04/23/03 3133M3DQ5 6.005 6.005 1,000,000.00 1,000,000.00 1,014,380.00 1,018,130.00 07/07/03 3133M4SW4 6.000 6.000 1,000,000.00 1,000,000.00 1,024,380.60 1,027,190.00 150 2,000,000.00 2,000,000.00 2,038,760.00 2,045,320.00 06/01/16 313400MC4 8.250 7.728 10,199,962.50 9,555,000.00 13,009,705.80 12,531,955.80 4831 10,199,962.50 9,555,000.00 13,009,705.80 12,531,955.80 • 12/10/15 313586UB3 10.350 8.418 3,688,593.75 3,000,000.00 4,673,430.00 4,514,070.00 4660 3,688,593.75 3,000,000.00 4,673,430.00 4,514,070.00 See Note NIA 2.120 2.120 8,961,707.18 8,961,707.18 8,961,707.18 8,961,707.18 191 N/A 2.201 2.201 28,536,150.46 28,536,150.46 28,536,150.46 28,536,150.46 See Note N/A 2.201 2.201 145,668.26 145,668.26 145,668.26 145,668.26 02/12/03 590188HZ4 6.000 5.955 2,015,010.00 2,000,000.00 2,008,900.00 2,016,180.00 05/15/03 79549BCL9 6.250 6.244 1,000,950.00 1,000,000.00 1,016,680.00 1,020,420.00 08/01/04 201615DS7 6.500 6.685 972,370.00 1,000,000.00 1,063,570.00 1,060,050.00 02/15/05 36962GUM4 7.250 7.229 1,002,970.00 1,000,000.00 1,100,720.00 1,093,930.00 03/15/05 345397SQ7 7.500 7.531 995,903.47 1,000,000.00 1,020,260.00 1,017,370.00 06/15/05 428236AD5 7.150 7.159 998,750.00 1,000,000.00 1,099,110.00 1,068,800.00 473 6,985,953.47 7,000,000.00 7,309,240.00 7,276,750.00 1689 TOTALS: 60,518,035.62 59,198,525.90 64,674,661.70 64,011,621.70 ` MARKET VALUES HAVE BEEN PROVIDED BY UNION BANK, Note: Average Maturity - Liquid, variable rate interest accounts including the Wells Fargo Sweep and LACIP were not Included in calculation of average maturity because the City has no control over the term of underlying investments and funds can be withdrawn at any time. LAIF was included because excluding this sizeable balance skews the overall average. Description of Bond City W. Covina 1997 Refunding Civic Ctr Proj City W. Covina 1997 Refunding Civic Ctr Proj City W. Covina 1997 Civic Ctr Ref City W. Covina 1997 Civic Ctr Ref City W. Covina 1997 Civic Ctr Ref City W. Covina 1997 Civic Ctr Ref City W. Covina 1997 Civic Ctr Ref City W. Covina 1997 Civic Ctr Ref City W. Covina 1997 Civic Ctr Ref City W. Covina 1997 Civic Ctr Ref CITY OF WEST COVINA BOND DETAIL REPORT DECEMBER 31, 2002 Type of Bond Type of Investment Certificate Fund Financial Security Assurance Certificate Fund Cash Esc Fund US Treasury Notes Esc Fund US Treasury Notes Esc Fund US Treasury Notes Esc Fund US Treasury Notes Esc Fund Resolution FDG Corp Fed Bk Entry Cpn Strp Esc Fund Israel ST US GOVT GTD NTS Esc Fund US Treasury 1313 Stripped Prin Esc Fund Cash *Market valuations have been provided by BNY Western Trust Company. Description of Issuer Maturity Date Original Cost Par value Market Value Rate I - . 0.00 0.00 - - '0.00 0.00 0.00 0.00 0.00 Ending Balances 0.00 0.00 0.00 r� U.S. Government Agency 2/28/2003 465,709.39 449,000.00 452,086.88 5.46 U.S. Government Agency 8/31/2003 1,567,107.25 1,503,000.00 1,526,954.06 3.56- U.S. Government Agency 2/29/2004 485,238.10 462,000.00 471,240.00 2.94 U.S. Government Agency 8/15/2004 1,564,000.00 1,564,000.00 1,528,997.68 1/15/2005 440,000.00 440,000.00 423,904.80 8/15/2005 2,019,000.00 2,019,000.00 1,900,504.89 8/15/2005 14,931,000.00 14,931,000.00 14,197,589.28 1,257.40 1,257.40 1,257.40 21,4737312.14 21,369,257.40 20,502,534.99 Ending Balances 21,473,312.14 21,369,257.40 20,502,534.99 Grand Totals 21,473,312.14 21,369,257.40 20,502,534.99