HomeMy WebLinkAboutStaff Report 217-10TO: HONORABLE CITY COUNCIL
FROM: CITY MANAGER DEPARTMENT: ADMINISTRATIVE
SERVICES
DATE: APRIL 19, 2010 CMR: 217:10
REPORT TYPE: INFORMATIONAL
SUBJECT: City of Palo Alto's Investment Activity Report for the Third Quarter,
Fiscal Year 2010
BACKGROUND
The purpose of this report is to inform Council of the City's investment portfolio status as of the end
of the third quarter. The City's investment policy requires that staff report quarterly to Council on
the City's portfolio composition compared to Council -adopted policy, portfolio performance, and
other key investment and cash flow information.
DISCUSSION
The City's investment portfolio is detailed in Attachment B. It is grouped by investment type and
includes theinvestment issuer, date of maturity, current market value, the book and face (par) value,
and the weighted average maturity of each type of investment and of the entire portfolio.
The par value of the City's portfolio is $331.4 million; in comparison, last quarter it was $328.1
million. The growth in the portfolio of $3.3 million since the last quarter primarily results from the
timing of cash flows. This includes delayed sales tax ("triple flip") and in -lieu vehicle license fee tax
payments received in January and May 2010. The portfolio consists of $20.1 million in liquid
accounts and $311.3 million in U. S. government treasury investments, agency securities, and
certificates of deposit. The $311.3 million includes $88.5 million in investments maturing in less
than two years, comprising 28.4 percent of the City's investment in notes and securities. The
investment policy requires that at least $50 million be maintained in securities maturing in less than
two years.
The current market value of the portfolio is 103.3 percent of the book value. The market value of
securities fluctuates, depending on how interest rates perform, when interest rates decrease, the
market value of the securities in the City's portfolio will likely increase; likewise, when interest rates
increase, the market value of the securities will likely decrease. Understanding and showing market
values is not only a reporting requirement, but essential to knowing the principal risks in actively
buying and selling securities. It is important to note, however, that the City's practice is to buy and
CMR: 217:10 Page 1 of 4
hold investments until they mature so changes in market price do not affect the City's investment
principal. The market valuation is provided by Union Bank of California, which is the City's
safekeeping agent. The average life to maturity ofthe investment portfolio is 3.55 years compared to
3.56 years last quarter.
Investments Made During the Third Quarter
During the third quarter, $29.9 million of government agency securities with an average yield of
4.1% percent matured. During the same period, government securities totaling $28.6 million with an
average yield of 3.2% percent were purchased. As higher yielding maturing investments are re-
invested at lower interest rates, the portfolio's yield is expected to decline in coming quarters. The
City's short-term money market and pool account increased by $4.6 million compared to the second
quarter. Investment staff continually monitors the City's short-term cash flow needs and adjusts
liquid funds to meet those needs.
Availability of Funds for the Next Six Months
Normally, the flow of revenues from the City's utility billings and General Fund sources is sufficient
to provide funds for ongoing expenditures in those respective funds. Projections indicate receipts
will be $183.2 million and expenditures will be $179.1 million over the next six months, indicating
an overall growth in the portfolio of $4.1 million.
As of March 31, 2010, the City had $20.1 million deposited in the Local Agency Investment Fund
(LAIF) and a money market account that could be withdrawn on a daily basis. In addition,
investments totaling $34.7 million will mature between April 1, 2010 and September 30, 2010. On
the basis of the above projections, staff is confident that the City will have more than sufficient funds
or liquidity to meet expenditure requirements for the next six months.
Compliance with City Investment Policy
During the third quarter, staff complied with all aspects of the investment policy. Attachment C lists
the restrictions in the City's investment policy compared with the portfolio's actual performance.
Investment Yields
Interest income on an accrual basis for the third quarter was $3.3 million. As of March 31, 2010, the
yield to maturity of the City's portfolio was 3.89 percent. This compares to a yield of 4.04 percent in
the second quarter. Even though interest rates have risen recently, the portfolio yield is expected to
gradually decrease in future quarters as staff continues to re -invest maturing securities at lower
interest rates. The City's portfolio yield of 3.89 percent compares to LAIF's average yield for the
quarter of 0.57 percent and an average yield on the two-year and five-year Treasury bonds during the
third quarter of approximately 0.90 percent and 2.41 percent, respectively.
Yield Trends
In the last five quarters, the Federal Open Market Committee (FOMC) maintained the historical low
federal funds and discount rate at 0,25 and 0.75 percent, respectively. The FOMC has improved its
economic outlook, as evidenced by the labor market stabilizing somewhat, increased business
spending on inventory, and improved liquidity in the financial system. However, FOMC continues to
believe that lower rates are necessary for an extended period to stimulate the economy given the
CMR: 217:10 page 2 of 4
weak housing market, high employment, and businesses' reluctance to rehire workers. Based on
current interest rates, the City's portfolio's yield is expected to decline, in the near -term.
Funds Held by the City or Managed Under Contract
Attachment A is a consolidated report of all City investment funds, including those not held directly
in the investment portfolio. These include cash in the City's regular bank account with Wells Fargo.
The bond proceeds, reserves, and debt service payments being held by the City's fiscal agents are
subject to the requirements of the underlying debt indenture. The trustees for the bond funds are U.S.
Bank and California Asset Management Program (CAMP). Bond funds with U.S. Bank are invested
in federal agency and money market mutual funds that consist exclusively of U.S. Treasury
securities. Bond funds in CAMP are invested in banker's acceptance notes, certificates of deposit,
commercial paper, federal agency securities, and repurchase agreements. The most recent data on
funds held by the fiscal agent is as of March 31, 2010.
FISCAL IMPACT
This is an information report with no fiscal impact resulting.
ENVIRONMENTAL REVIEW
There is no environmental review required for this report.
ATTACHMENTS:
Attachment A: Consolidated Report of Cash and Investments
Attachment B: Investment Portfolio, as of March 31, 2010
Attachment C: Investment Policy Compliance
CMR: 217:10 Page 3 of 4
PREPARED BY:
DEPARTMENT HEAD APPROVAL:
CITY MANAGER APPROVAL:
10 n
TARUN NARAYAN
Senior Finan ial Analyst
L
Direct
JIM TI NE
City Manager
ve Services
CMR: 21710 Page 4 of 4
Attachment A
Consolidated Report
City of Palo Alto Cash and Investments
Third Quarter, Fiscal Year 2009-10
(Unaudited)
Book Value Market Value
City Investment Portfolio (see Attachment B)
Other Funds Held by the City
$ 334,683,469 $ 345,804,403
Cash with Wells Fargo Bank 2,996,830 2,996,830
(includes general and imprest accounts)
Investment with CAMP (University Ave. Parking Garages) 592,554 592,554
Petty/Working Cash 1,500 1,500
Total - Other Funds Held By City
Funds Under Management of Third Party Trustees
(Debt Service Proceeds)
3,590,883 3,590,883
US Bank Trust Services **
1998 Golf Course Certificates of Participation
Debt Service Lease Payment Funds 79 79
2002 Civic Center Certificates of Participation
Reserve Fund 350,000 350,000
2002 Downtown Parking Impvt. Certificates of Participation
Reserve Fund 237,950 237,950
Escrow Account for Partial Defeasance of Bonds 760,184 760,184
2002 Utility Revenue Bonds
Debt Service Fund 138,884 138,884
2009 Water Revenue Bonds (Build America Bonds)
Project, Debt Service, Reserve, Cost of Issuance Funds 31,449,399 31,449,399
California Asset Management Program (CAMP) ***
1998 Golf Course Certificates of Participation
Reserve Fund 636,612 636,612
2001 University Ave. Parking Bonds
Reserve Funds 2,379 2,379
2002 University Ave. Parking Bonds
Reserve and Admin. Funds 3,217,500 3,217,500
2002 Utility Revenue Bonds
Reserve Funds 1,823,595 1,823,595
Total Under Trustee Management
GRAND TOTAL
38,616,582
$ 376,890,934
38,616,582
$ 388,011,868
* These funds are subject to the requirements of the underlying debt indenture.
**U.S. Bank investments are in money market mutual funds that exclusively invest in U.S. Treasury securities.
*** CAMP investments are in money market mutual fund which invest in bankers acceptance, certificate of deposit,
commercial paper, federal agency securities, and repurchase agreements.
InverWent Repoli AllecN,wnlaAs And:W 11A 41V2010 PM
CUSIP
Inv estmen t # Issuer
ATTACHMENT B
City of •Palo Alto
Fund ALL - P ortfoli o Listings
Inve stments by Fund
March 31, 2010
Purchase
Date
Book Val ue
Par Value
City of Palo Alto
Administration Svcs . Dept .
250 Hamilton Ave., 4th Floor
Palo Alto, CA 94301
(650)329-2362
Curre nt YTM YTM M at urity Day s To
Market Val ue Rat e 360 365 Date M at urity
Ce rtificates of De po sit - Ban k
9244804531 673
9244804549 674
Manage d Pool Accounts
SYS158 158
SYS159 159
Federal Agency Is sues - Co upon
30769PAA0 645
31315PGE3 840
307692AA1 628
307692.0.01 630
307692AA1 631
307692AA1 696
31315PLR8 820
31315PM08 821
31315PES4 838
31315PEY1 839
31331TKF7 592
31331SG56 593
31331VY91 653
31331V4E3 655
31331 V WS1 657
31331S3H4 658
31331VTY2 662
31331XSR4 690
31331XWU2 693
31331XA36 701
31331XU75 715
Run Date: 041/12010 - 19:18
Certificate of Deposit
Certificate of Deposit
Fidelity investments
Local Agency Investment Fund
Federal Agriculture Mortgage C
Federal Agriculture Mo rtgage C
Fede ral Agriculture Mortgage C
Federal A griculture Mortgage C
Federal Agriculture M ortgage C
Federal Agriculture Mortgage C
Federal Agricultural Mortgage
Federal A gricultural M ortgage
Federal Agricultural Mo rtgage
Federal Agricultural Mortgage
Federal Farm Credit Bank
Federal Farm Credit Bank
Federal Farm Credit Bank
Federal Farm Credit Bank
Federal Farm Credit Bank
Federal Farm Cre dit Bank
Federal Farm Credit Bank
Federal Farm Credit Bank
Federal Farm Credit Bank
Fe dera l Farm Cre dit Bank
Federal Farm Credit Bank
11/24/2006 173,730.87 173,730.87 173,730.87 4.020
11/24/2006 166,880.94 166,880.94 166,880.94 4.020
S ubtotal a nd A ver age
"340,611.81 340, 611.81 340,611.81
3.970 4.025 09/24/2010 176
4.069 4 .126 09/24/2011 541
4.019 4 .075 354
07/01/2008 10,574 .57 10,574 .57 10,574,57 0.010
07/01/2008 20,116,883.70 20,116,883.70 20,135,950.99 0.530
Subtotal and A verage
07/20/2006
01/19/2010
05/12/2006
05/18/2006
05/18/2006
05/03/2007
08/11/2009
08/10/2009
12/30/2009
12/30/2009
06/14/2005
06/21/2005
09/26/2006
10/12/2006
10/16/2006
10/16/2006
11/16/2006
03/27/2007
04/25/2007
05/25/2007
08/20/2007
20,127,458.27 20,127,458.27 20,146,525.56
0.009 0.010
0.522 0.530
0.522 0.530
1
1,999,086 .33 2,000,000.00 2,100,060 .00 5 .500
2,000,000.00 2,000 ,000.00 2,076,840.00 .4.125
3,983,802 .23 4,000,000,00 4,160,560 .00 4 .875
1,992,088.02 2,000,000.00 2,080,280.00 4.875
3,983,905 .39 4,000,000 .00 4,160,560.00 4 .875
2,000,000.00 2,000,000 .00 2,080,280.00 4.875
2,000,000.00 2,000,000.00 2,063 ,000.00 3.250
2,000,000.00 2,000,000.00 2,034,760.00 2.100
2,000,000.00 2,000,000.00 2,013,680.00 2.820
1,500,000 .00 1,500,000.00 1,588,245.00 4.500
1,499,794.93 1,500,000 .00 1,531,875 .00 4.180
2,000,000.00 . 2,000,000.00 2,017,500.00 4 .200
2,022,069.18 2,000,000.00 2,208,120 .00 5.280
4,007,174. 01 4,000,000.00 4,441,240.00 5.180
2,040,956.47 2,039,0.00 .00 2,260,109.16 5.200
1,479,580.15 1,500,000 .00 1,635,945.00 4.750
. 2,012,796.17 2,000,000.00 2,190,620.00 5.200
2,000,000.00 2,000,000.00 2,191,260.00 4 .875
2,000,000.00 2,000,000.00 2,088,760.00 4.800
2,000,000.00 2,000,000.00 2,100,000.00 5 .050
3,010,846.99 3,000,000.00 3,315,930 .00 5.300
5.465
4 .068
5.389
5.375
5.385
4 .806
3.205
2.071
2 .781
4.438
4.147
4.142
4.827
5.059
5 .100
5.104
4.877
4.807
4 .734
4.980
5.128
5.541
4.125
5.464
5.450
5.460
4.872
3.250
2.100
2.820
4 .500
4.205
4.200
4.894
5.130
5 .171
5.175
4.945
4.874
4.800
5.050
5.199
a LME DVZIV
07/15/2011 470
01/19/2017 2,485
01/14/2011 288
01/14/2011 288
01/14/2011 288
-01/14/2011 288
08/11/2014 1,593
08/10/2012 862
12/30/2014 1,734
12/30/2019 3,560
11/05/2010 . 218
06/21/2010 81
08/16/2013 1,233
09/15/2014 1,628
04/17/2014 1,477
02/18/2014 1,419
03/20/2013. 1,084
03/14/2014 1,443
04/25/2011. 389
05/25/2011 419
08/13/2014 1,595
Portfolio CPA
• AP
FI {PRF
Report Vei. 7 31
CUSIP Inve stment # i ss uer
Fund ALL - Portfolio Listings
Invest ments by Fund
March 31, 2010
Page 2
Purchase Current YTM YTM Maturity D ays To
Date Book Val ue P ar Val ue Mark et Val ue Rat e 360 365 D at e M aturity
Fe deral Agen cy iss ues - C oupon
31331GLT4 788 Federal Farm Credit Bank 03/04/2009 1,000,000.00 1,000,000:00 1,034,380.00 3.750 3 .698 3.749 01/29/2016 2,129
31331GTT6 796 Callable Federal Farm Credit Bank 04/22/2009 1,000,000 .00 1,000,000.00 993,750.00 4.000 3.945 4.000 04/22/2019 3,308
31331GUP2 800 Callable Federal Farm Credit Bank 05/07/2009 1,000,000 .00 1,000,000.00 1,000,630.00 4.125 4 .068 4 .125 05/07/2018 2,958
31331GVK2 804 Callable Federal Farm Credit Bank 05/06/2009 1,500,000.00 1,500,000,00 1,502,820.00 2.450 2.416 2.450 05/06/2013 1,131
31331GL80 823 Federal Farm Credit Bank 08121/2009 2,000,000 .00 2,000,000.00 2,030,000 .00 3.000 2.959 3 .000 09/22/2014 1,635
31331GU31 825 Federal Farm Credit Bank 09/24/2009 2,000,000.00 2,000,000 .00 2,012,500.00 1 .800 1.775 1.800 09/24/2012 907
31331GZ44 826 Federa l Farm Cre dit Bank 10/15/2009 2,000,000.00 2,000,000.00 1,998,760.00 . 1.550 1.528 1.550 10/15/2012 928
31331G6D6 835 Federal Fa rm Cre dit Bank 12/09/2009 2,000,000.00 2,000,000 ,00 1,996,260.00 0.875 0.863 0.875 12/09/2011 617
31331JFZ1 850 Fe de ral Farm Credit Bank 03/08/2010 2,000,000 .00 2,000,000.00 1,989,380 .00 3.375 3.328 3.375 03/08/2017 2,533
31331JGS6 853 Callable Federal Farm Credit Bank 03/11/2010 . 1,000,000 .00 1,000,000.00 992,190.00 3.200 3.156 3 .200 12!11/2015 2,080
31331VK47 640 Fe deral Farm Credit - S & P 06/28/2006 2,000,000 .00 2,000,000 .00 2,034,380.00 5.500 5.426 5 .501 07/28/2010 118
31331XBS0 659 Federal Farm Credit- S & P 10/25/2005 3,000,000.00 3,000,000.00 3,294,390.00 5.050 4.979 5.048 11/25/2013 1,334
31331XCY6 660 Federal Farm Credit- S & P 11/06/2006 2,000,000.00 2,000,000 .00 2,211,260 .00 5.050 4.980 5.050 05/06/2015 1,861
31331XGC0 665 Federal Farm Credit - S & P 12/07/2006 1,500,000.00 1,500,000.00 1,512,195 .00 4.750 4.684 4.750 06/07/2010 67
31331XGX4 666 Federal Farm Credit- S & P 12/11/2006 2,000,000.00 2,000,000,00 2,140 ,620.00 4 .625 4.561 4.625 06/11/2012 802
31331XM Q2 675 Federal Farm Credit - S & P 01/26/2007 2,000,000.00 2,000,000.00 2,014,380.00 5.000 4 .933 5.002 05/26/2010 55
31331XNE8 676 Federal Farm Credit - S & P 02/01/2007 2,000,000.00 2,000,000.00 2,074,380.00 5.050 4 .980 5.050 02/01/2011 306
31331XPB2 677 Federal Farm Credit - S & P 02/07/2007 2,000,000 ,00 ' 2,000,000 .00 2,185,000 .00 5 .150 5 .079 5.150 02/07/2013 1,043
31331XVH2 692 Federal Farm Credit - S & P 04/12/2007 2,000,000 .00 2,000,000 .00 2,146,880.00 4.875 4.808 4.875 04/12/2012 742
31331XZK1 697 Federal Farm Credit - S & P 05/22/2007 2,000,000 .00 2,000,000 .00 2,043,760.00 4.900 4.834 4 .902 09/22/2010 174
31331X627 702 Federal Farm Credit - S & P 06/05/2007 3,500,000 .00 3,500,000 .00 3,853,290 .00 5.200 5.130 5,201 08/05/2013 1,222
31331XC26 703 Federal Farm Cre dit- S & P 06/05/2007 2,000,000.00 2,000,000 .00 2,223,120.00 5,250 5.178 5.250 06/05/2014 1,526
31331XD74 705 Fede ral Farm Credit - S & P 06/12/2007 2,000,000.00 2,000,000.00 2,220,620.00 5.330 5.257 5 .330 12/18/2013 1,357
31331XC26 707 Federal Farm Credit - S & P 06/08/2007 2,975,799.76 3,000,000.00 3,334,680 .00 5.250 5 .409 5.484 06/05/2014 1,526
31331XH39 708 Fe de ral Fa rm Credit - S & P 06/28/2007 2,000,000. 00 2,000,000.00 2,024,380.00 5 .250 5.178 5,250 06/28/2010 88
31331XK35 709 Federal Farm Credit- S & P 07/05/2007 2,000,000. 00 2,000,000.00 2,113,120.00 5.250 5 .178 5.250 07/05/2011 460
31331XL42 711 Federal Farm Cre dit - S & P 07/16/2007 2,000,000.00 2,000,000.00 2,029,380.00 ' 5.250 5 .176 5.250 07/1612010 106
31331X230 717 Federal Farm Credit - S & P 09/04/2007 2,000,000.00 2,000,000 .00 2,162,500,00 4.930 4.862 4 .930 09/04/2012 887
31331X2U 5 719 Federal Farm Credit - S & P 09/06/2007 1,500,000.00 1,500,000 .00 1,583,445 .00 4 .750 4.684 4.750 09/06/2011 523
31331X3H3 720 Federal Farm Credit - S & P 09/17/2007 1,500. 000. 00 1,500,000.00 1,644,375 .00 5.000 4.931 5.000 09/17/2014 1,630
31331X5Y 4 721 Federal Farm Credit- S & P 10/03/2007 1,500,000,00 1,500,000.00 1,654,695.00 5 .000 4.931 5.000 10/03/2014 1,646
31331Y ER7 724 Federal Farm Credit - S & P 11/21/2007 2,000,000.00 2,000,000.00 2,110,000.00 4 .350 4 .290 4.350 11/21/2011 599
Run Date: 04111/2010 - 19:18
Portfolio CPA
AP
F1(PRF_FI)7.1,1
Report Ver. 7.3 .1
CUSIP Investment# Issuer
Fund ALL .-_Portfolio Listings
I nvestments by Fund
M ar ch 31, 2010
Purchase
D at e
Page 3
Current YTM YTM Maturity Days To
B ook Value 'Par Value Market Value Rate 360 365 Date Maturity
Federal A gency Issu es - Coupon
31331YHQ6 725 Fed er al F arm Cr edit - S & P
31331YSV 3 747 Federal Farm Credit - S & P
31331Y2U3 766 Callable Federal Farm Credit- S & P
31331 GLM9 779 Callable Federal Farm Credit - S & P
31331GPN3 785 Federal Farm Credit- S & P
31331YCJ7 722 Federal Fame Credit Bank - Moo
31331VCQ7 742 Fed. Farm Credit Bank
31331SKH5 744 Fed. Farm Credit Bank
3133MCLA1 562 Federal Home Loan Bank
3133MYYZ4 569 Federal Home Loan Bank
3133M RCM2 570 Federal Home Loan Bank
3133X06Q7 574 Federal Home Loan Bank
31339XM X9 582 Federal Home Loan Bank
3133M RCM2 584 Fede ra l Home Loa n Ba nk
3133X2BX2 585 Federal Home Loan Bank
3133X26X2 586 Federal Horne Loan Bank
3133MDBT9 595 Federa l Home Lo an Bank
3133X6TH8 596 Federal Home Loan Bank
3133XFJY3 642 Federal Home Loan Bank
3133XG3W2 644 Federal Home Loan Bank
3133XF5T9 648 Fe de ral Home Loan Bank
3133X9ZZ6 649 Federal Home Loan Bank
31339Y7K2 652 Federal Home Loan Bank
3133XHBL5 654 Federal Horne Loan Bank
3133XHW57 667 Federal Home Loan Bank
3133XJUT3 685 Federal Home Loan Bank
3133XGJ96 699 Federal Home Loan Bank
3133XGJ96 706 Fe de ral Home Lo an Bank
3133XLDG5 710 Federal Home Loan Bank
3133XLDG5 713 Federa€ Home Loan Bank
3133XPBA 1 730 Federal Home Loan Ban k
3133XP5A1 741 Federal Ho me Loan Bank
Ru n Date: 04111/2010 - 19:18
12/12/2007 2,000,000.00 2,000,000.00 2,120,000.00 4 .625 4.561 4.624 12/15/2017. 2,815
02/11/2008 1,500,000.00 1,500,000.00 1,576,875.00 3 .850 3.797 3.850 02/11/2015 1,777
07/08/2006 2,000,000.00 2,000,000.00 2,022,500.00 4.625 4 .561 4.625 07/08/2013 1,194
01/27/2009 2,000,000 .00 2,000,000.00 1,958,120.00 4.000 3 .944 3 .999 01/25/2019 3,221
03/04/2009 .1,500,000.00 1,500,000.00 1,531,410.00 2 .600 2 .564 2.600 03/04/2013 1,066
10/30/2007 2,000,000.00 2,000,000 .00 2,161,880 .00 4.900 4.832 4.900 10/30/2017 2,769
01/30/2008 2,075,663.74 2,000,000.00 2,183,760 .00 4.800 3 .945 4.000 10/19/2015 2,027.
01/30/2006 1,026,185 .51 1,000,000.00 1,080,940.00 4.500 3.620 3.873 01/22/2015 1,757
06/18/2004 1,515,190.64 1,500,000.00 1,555,785 .00 6 .625 4.654 4 .718 11/15/2010 228
08/25/2004 1,998,441.22 2,000,000.00 2,007,500.00 3.375 4.056 4 .113 05/14/2010 43
10/05/2004 1,002,095.22 1,000,000 .00 1,016,560 .00 4.750 4.044 4.100 08/13/2010 134
10/05/2004 1,500,000.94 1,500,000.00 1,521,090.00 4.125 4.067 . 4.123 08/13/2010 134
01/20/2005 1,995,778 .35 2,000,000 .00 2,033,120.00 3.660 4 .083 4 .140 09/30/2010 182
01/27/2005 1,503,067.73 1,500,000.00 1,524,840.00 4.750 4.063 4.120 08/13/2010 134
01/27/2005 2,001,051 .34 . 2,000,000.00 2,045,000.00 4.250 4.096 4 .153 11/15/2010 ,228
03/01/2005 1,998,678 .25 2,000,000.00 ' 2,045,000.00 4 .250 4.310 4 .370 11/15/2010 228
07/11/2005 2,024,817 .54 2,000,000.00 2,090,620.00 5.875 4.201 4 .260 02/15/2011 .320
07/11/2005 1,500,119.28 1,500,000 .00 1,511,715.00 4 .250 4.144 4.202 06/11/2010 71
07/07/2006 1,993,531.43 2,000,000 .00 2,103,760.00 5 .250 5.483 5 .560 06/10/2011 435
07/11/2006 2,001,898 .14 2,000,000 .00 2,116,880 .00 5.600 5.435 5.511 06/28/2011 453
09/12/2006 1,998,183.97 2,000,000.00 2,115,000.00 5.000 5 .002 5.072 09/09/2011 526
09/12/2006 1,981,318 .77 2,000,000 .00 2,121,260.00 4.500 5.040 5.110 01/06/2012 645
09/26/2006 2,004,471.25 2,000,000 .00 2,186,880 .00 5 .000 4.850 4.918 07/16/2013 1,202
10/12/2006 1,984,989.53 2,000,000.00 2,193,120.00 4.875 5.020 5 .089 06/1.3/2014 1,534
12/14/2006 2,000,000. 00 2,000,000 .00 2,188,120.00 4.875 4 .806 4.873 12/13/2013 1,352
02/23/2007 2,000,000.00 2,000,000.00 2,148,120.00 5.000 4.929 4.997 03/09/2012.. 708
05/16/2007 2,013,854.55 2,000,000 .00 2,210,620.00 5.250 4 .943 5.011 09/13/2013 1,261
06/08/2007 994,343.53 1,000,000.00 1,105,310.00 5.250 5.369 5.444 09/13/2013 1,261
06/28/2007 2,500,000.00 2,500,000.00 2,777,350.00 5 .375 5.300 5.374 06/13/2014 1,534
08/20/2007 3,021,376. 34 3,000,000.00 3,332,820.00 5 .375 5.099 5 .170 06/13/2014 1,534
01/25/2008 2,000,000.00 2,000,000.00 2,063,120.00 3.500 3.451 3.499 03/13/2015 1,807
01/30/2008 2,945,517.94 3,000,000.00 3,094,680 .00 3 .500 3.869 3.923 03/13/2015 1,807
Portfolio CPA
AP
Report Ver.;7°3:1 ' ._.,-
Fund ALL Portfolio Listings
Investments by Fund
March 31, 2010'
Page 4
Purchase Current yT M yTM • Maturity Days To
CUSIP Inve stment # Issuer D at e Bo ok Value Par Val ue Mark et Val ue Rate 360 365 Date Mat urity
Federal Agency Issues - Coupon
3133XSP93 777 Federal Home Loan Bank 01/16/2009 3,058,531 .82 3,000,000.00 3,117,180.00 3.125 2 .794 2.833 12/13/2013 1,352
3133XSWJ3 778 Callable Federal Home Loan Bank 02/13/2009 600,000.00 600,000.00 593,064 .00 4.250 4 .191 4.250 02/1312019 3,240
3133XTCS3 789 Federal Home Loan Bank 03/16/2009 2,000,000.00 2,000,000.00 2,051,260 .00 3.000 2.958 2 .999 03/13/2014 1,442
3133XTFQ4 793 Federal Home Loan Bank 04/01/2009 3,000,000.00 3,000,000.00 3,063,750 .00 2 .900 2.860 2 .900 04/01/2014 1,461
3133XTNL6 815 Callable Federal Home Loan Bank 05/20/2009 1,000 ,000 .00 1,000,000.00 989,060.00 4.250 4.191 4.250 05/20/2019 3,336
3133XTQH2 817 Fede ral Home Loan Bank 05/22/2009 1,500,000 .00 . 1,500,000.00 1,516,875.00 1.800 1.775 1.800 05/22/2012 782
3133XTYD2 818 Federal Home Loan Bank 06/16/2009 2,000,000 .00 2,000,000.00 2,103,120.00 4.000 3.945 4 .000 06/16/2015 1,902
3133XUCX9 819 Federal Home Loan Bank 07/20/2009 2,000 ,000.00 2,000,000 .00 2,022,500 .00 1.875 2.210 2.240 07/23/2012 844
3133XUMS9 822 Federal Ho me Lo an Bank 08/12/2009 3,000,000.00 3,000,000 .00 3,085,320.00 4.500 4 .437 4. 499 09/13/2019 3,452
3133XUM R1 827 Fe deral Home Loan Bank 10121/2009 1,025,631.15 1,000,000 .00 1,028,130 .00 3 .250 2.594 2.631 09/12/2014 1,625
3133XDTL5 830 Federal Home Loan Bank 10/21/2009 - 3,287,301 .96 3,000,000.00 3,292,500.00 5 .000 3.101 3 .145 12/21/2015 2,090
3133XVU74 831 Callable Federal Home Loan Bank 12/17/2009 3,000,000.00 3,000,000,00 2,959,680 .00 3.000 2.958 3.000 12/17/2019 3,547
3133XV RJ2 832 Federal H ome Loan Bank 11/19/2009 3,022 ,608.36 3,000,000.00 3,000,000.00 3.500 3.325 3.372 12/09/2016 2,444
3133MJQF0 833 Federal Home Loan Bank 11/19/2009 1,346,014 .14 1,200,000.00 1,337;,628.00 5.500 3 .304 3 .350 08/15/2016 2,328
3133XVZP9 834 Callable Federal Home Loan Bank 12/24/2009 Z000,000 .00 2,000,000 .00 1,963,120 .00 4.000 3.945 4.000 12/24/2018 3,189
3133XW4W6 837 Federal Home Loan Bank 12/11/2009 2,000,000.00 2,000,000.00 1,987,500.00 1 .500 1.479 1.500 12/11/2012 985
3133XWRQ4 843 Callable Federal Home Loan Bank 02/10/2010 2,000,000,00 2,000,000.00 2,005,620.00 4 .370 4.310 4.370 02/10/2020 3,602
3133XWX53 845 Federal Home Loan Bank 02/03/2010 2,000,000 .00 2,000,000.00 1,996,880 .00 1.100 1 .085 1.100 04/03/2012 733
3133XWX95 847 Federal Home Loan Bank 02/19/2010 2,000,000.00 2,000,000 .00 1,993,760.00 2.750 2 .711 2 .749 03/13/2015 1,807
3133XXH67 851 C allable Fe deral Home Loan Bank 03/29/2010 1,500,000.00 1,500,000.00 1,492,965 ,00 4.000 3.945 4 .000 03/29/2018 2,919
3133XXH59 852 Callable Federal Home Loan Bank 03/17/2010 1,500,000.00 1,500,000.00 1,484,535 .00 3.625 3 .575 3 .625 03/17/2017 2,542
3133XWW47 854 Federal Home Loan Bank 03/19/2010 2,117,391.14 2,115,000.00 2,114,344.35 1 .125 1.051 1 .065 03/09/2012 708
3133XHXW7 663 Federal Home Loan Bank - S & P 11/27/2006 2,000,000.00 2,000,000.00 2,190,620.00 4.875 4 .808 4.875 11/27/2013 1,336
3133XP4Q4 729 Callable Federal Home Loan Bank - S & P 01/24/2008 1,000,000.00 1,000,000.00 1,021,250.00 4.500 4.438 4.500 01/24/2018 2,855
3133XPTJ3 751 Ca lla ble Federal Home Loan Bank - S & P 02128/2008 1,500,000. 00 1,500,000.00 1,547,820 .00 4.500 4 .421 4 .482 02!2812018 2,890
3133XSNC8 770 Callable Federal Home Loan Bank - S & P 12116/2008 1,000,000. 00 1,000,000.00 1,027,810.00 4.250 4 .191 4.250 12/16/2013 1,355
3133XSZ50 781 Federal Home Loan Bank - S & P 02/06/2009 2,000,000.00 2,000,000.00 2,037,500.00 2 .100 2.071 2.100 0210612012 676
3133XTFD3 792 Federal Ho me Lo an Bank - S & P 03/27/2009 2,000,000. 00 2,000,000 .00 2,039,380.00 2.850 2.810 2.850 03/27/2014 1,456
3133XTHE9 794 Federal Home Loan Bank - S & P 04/13/2009 2,000,000.00 2,000,000.00 2,028,760.00 2.000 1.972 2.000 07/13/2012 834
3133XTKX3 801 Callable Fede ral Home Loan Bank - S & P 05/13/2009 1,500,000. 00 1,500,000.00 1,470,945.00 4.125 4.068 4.125 05/13/2019 3,329
3133XTN44 810 Catlabie Federal Home Loan Bank - S & P 05/13/2009 1,000,000.00 1,000,000.00 989,380 .00 4.300 4.241 4.300 05/13/2019 3,329
3133XTP26 812 Callable Federal Home Loan Bank - S & P 05/20/2009 1,500,000. 00 1,500,000.00 1,498,590.00 4 .080 4.024 4,080 05/20/2019 3,336
Run Date: 04/11/2010 -19:18
P ortfoli o CPA
AP
Fl (PRF_Fl) 7.1 .1
Report Ver, 7,3.1
CUSP
Investment # Issuer
Fund ALL - Portf olio Listings
Investments by Fund
March 31, 2010
Purchase
Date
Book Value Par Value
Page 5
C urrent 1•TM YTM Maturity Day s To
Market Value Rat e 360 365 Date Maturity
Federal Agenc y Issue s - Coupon
3133XTPF7 813 Callable Federal Hom e Loan Bank - S & P
3134A35H5 563 Fed. Home Loan Mortgage Corp .
3128X06K0 571 Fed. Home Loan Mortgage Corp.
3128X06K0 576 Fed. Home Loan Mortgage -Corp.
3128X3M34 579 Fed. Home Loan Mortgage Corp .
3134A4VB7 594 Fed. Home Loan Mortgage Corp.
3128X1KG1 679 Fed. Home Loan Mortgage C orp.
3128X1 KG1 682 Fed. Home Loan Mortgage Corp.
3134A4UM4 714 Fed. Horne Loan Mo rtgage Corp.
3128X8WF5 795 Callable Fed. Horne Loan M ortgage Corp.
3128X8E73 808 Ca lla ble Fe d. Ho me Lo an Mo rtgage Corp.
3128X9FN5 824 Callable Fed. Home Loan M ortgage Corp.
3128X33E1 828 Fed. Ho me Lo an M ortgage Corp.
3128X9VP2 841 Callable Fed. Home Lo an Mortgage Corp.
3128X9VJ6 842 Callable Fed. Home Loan Mortgage Corp.
3128X9XF2 844 Callable Fed. Home Loan Mortgage Corp.
3128X9ZZ6 846 Callable Fed. Home Loan Mortgage Corp.
3128X9K33 848 Calla ble Fed. Home Loan Mortgage Corp.
3128X6N85 734 Callable Fed. Home Ln Mtg. S&P & Fitch
3128X7ED 2 757 Callable Fed. Home Ln. Mtg_ Corp -S&P
31359MFS7 575 Federal National Mortgage Asso
31359MF57 583 Federal National Mortgage Asso
3136F3TQ9 591 Federal National Mortgage Asso
31364FBV2 678 Federal National M ortgage Asso
31364KSSO 683 Federa l Na tio na l M ortgage Asso
3139BANT5 776 Federal National M ortgage Asso
3136FHGA7 790 Callable Federal National M ortgage A sso
31398AXB3 798 Callable Federal National M ortgage A sso
3136FHPX7 805 Callable Federal National M ortgage A sso
3136FHRE7 807 Callable Federal National Mortgage Asso
3136FHT B1 811 Calla ble Fe de ral Na tio nal Mortgage Asso
31359MXX6 829 Federal National Mortgage A sso
Run Oate: 04/1112010 - 19:18
06101/2009
06/18/2004
10/05/2004
11/09/2004
11/19/2004
07/11/2005
02/07/2007
02/15/2007
08/20/2007
04/21/2009
05/19/2009
10/01/2009
10/21/2009
02/05/2010
02/03/2010
02/24/2010
02/26/2010
03/23/2010
01/31/2008
04/01/2008
11/09/2004
01/20/2005
06/14/2005
02/07/2007
02/15/2007
01/16/2009
03/23/2009
05/05/2009
05/14/2009
05/20/2009
05/28/2009
10/21/2009
1,500,000.00
1,512, 929.62
2,000,317 .23
1,500,289.68
1,000,000.00
1,499,810.73
1,456,153.70
1,943,597.46
1,961,381.93
1,500,000.00
1,500,000.00
2,000,000 .00
2,204,914.56
1,500,000.00
2,000,000.00
2,000,000.00
1,500,000.00
2,000,000.00
1,500,000 .00
1,500,000.00
2,011,328 .31
1,005,588.62
1,998,842.94
2,061,275.15
1,406,758.30
3,158,372. 33
1,000,000.00
1,500,000.00
1,500,000.00
1,500,000. 00
1,500,000.00
2,202,137. 96
1 ,500,000.00
1 ,500,000.00
2,000,000 .00
1,500, 000.00
1,000, 000 .00
1,500, 000.00
1,500, 000.00
2,000, 000 .00
2,000, 000.00
1,500,000.00
1,500,000.00
2,000, 000.00
2,000,000 .00
1,500, 000.00
2,000, 000.00
2,000, 000 .00
1,500,000.00
2,000 ,000.00
1,500,000.00
1,500,000.00
2,000,000.00
1,000,000, 00
2,000,000.00
2,000,000 .00
1, 500, 000.00
3,000,000.00
1,000,000.00
1,500,000.00
1,500,000 .00
1,500,000.00
1,500, 000.00
2,000,000.00
1,500,465.00
1,546,410.00
2,007,540 .00
1,505,655.00
1,023,330.00
1,516,410.00
1,598,445 .00
2,131,260 .00
2,165,000.00
1,502,505.00
1,516,305 .00
2,005,240.00
2,201,400 .00
1,504,080 .00
1,996,380.00
1,994,600.00
1,504,440.00
1,988,200.00
1,599,150.00
1,500,000 .00
2,028,760:00
1,014,380.00
2,010, 620 .00
2,230,320.00
1,514,070.00
3,199,680.00
1,017,810.00
1,500,945.00
1,514,070.00
1,502,820.00
1,492,965.00
2,201,260.00
3750
6.875
4.250
4.250
4.400
4.125
4 .000
4.000
4.500
3,000
2.170
4.500
5.050
3.250
4.500
4 .000
4.500
4.500
4.300
3 .500
7.125
7 .125
3.750
6 .470
2 .000
4.250
3.250
2 .800
2.125
2 .250
4.500
5.000
3.698
4.606
4.004
3.964
4.339
4 .117
5.010
4 .970
5.033
2 .958
2 .140
4.438
2 .713
3.205
4 .438
3.945
4.438
4 .438
4.241
3.452
3.964
4.012
4.108
4.967
4.956
2.298
3.206
2.761
2.095
2 .219
4.438
2.736
3.750
4 .670
4.060
4.020
4.400
4 .174
5.080
5.040
5.103
3.000
2 .170
4.500
2.751
3.250
4.500
4.000
4 .500
4.500
4.300
3.500
4.019
4.067
4.165
5.036
5.025
2.330
3.250
2.800
2 .125
2.250
4 .500
2.774
06/01/2016 2,253
09/15/2010 167
05/05/2010 34
05/05/2010 . 34
11/19/2010 232
07/12/2010 102
06/12/2013 1,168
06/12/2013 1,168
01/1512014 1,385
04/21/2014 1,481
11/19/2012 963
10/01/2019 3,470
01/26/2015 1,761
02/05/2015 1,771
02/03/2020 3,595
08/24/2017 2,702
02/26/2020. 3,618
03/23/2020 3,644
01/31/2015 1,766
04/01/2013 1,096
06/15/2010 75
06/15/2010 75
05/27/2010 56
09/25/2012 908
08/17/2012 869
02/25/2013 1,061
12/23/2014 .1,727
05/05/2014 1,495
05/14/2014 1,504
11/20/2012 964
05/28/2019 3,344
'03/02/2015 1,796
Fl {PRF FI)-:7 1 `I_ .`.
Report Ver. 7 31
CUSIP .
Investment # Issuer
Fund ALL -`Portfolio Listings
Investnients by Fund
March 31, 2010
Purchase
Date
B ook Value
Par Val ue
Page 6
Current YTM YTM Maturity Days To
M ark et V al ue Rate 360 365 Dat e M at urity
Fede ral Agency Is sues - Cou pon
3136FJXY2 836
31398A1139 849 Callable
3136F8M 77 731 Callable
31398APN6 761 Callable
3136F9ES8 763 Callable
3136FHV C6 814 Callable
3136FHXF7 816 Callable
313586UB3 743
880591DT6 643
880591 CW0 656
880591CW0 661
880591DL3 684
880591DY5 716
Federal National Mortgage Asso .
Federal National Mortgage Asso
Fed. Nat. Mortg, Assoc. -S&P
Fed. Nat. Mortg. Assoc . -S&P
Fed. Nat. Mortg. Assoc. -S&P
Fed. Nat. Mortg. Assoc. -S&P
Fed. Nat. Mortg. Assoc. -S&P
Fed. National M ortgage Assoc.
Tennessee Valley Authority
Tennessee Valle y Authority
Tennessee Valley Authority
Tennessee V alley Authority
Tennessee Valle y Autho rity
Tre asu ry Se curities - Cou po n
912828HK9
912828M00
769
855
U. S. Treasury
U. S. Treasury
12/23/2009
03/17/2010
02/07/2008
04/08/2008
04/02/2008
05/28/2009
06/10/2009
01/30/2008
07/07/2006
10/16/2006
11/16/2006
02/15/2007
08/20/2007
Subtotal and A verage
08/06/2008
03/19/2010
Subtotal and A verage
1,500,000.00
1,500,000.00
2,000,000 ,00
1,000,000.00
1,000,000.00
1,000,000.00
2,000,000 .00
3,914,447,70
2,044,678.22
1,532,670 .65
3,083,464.51
1,560,950.58
2,890,795.40
1,500,000.00
1,500,000.00
2,000,000.00
1,000,000.00
1,000,000.00
1,000,000.00
2,000,000.00
3,000,000.00
2,000,000.00
1,500,000.00
3,000,000 .00
1,500,000.00
3,000,000 .00
308,996,658 .99 306,954,000.00
2,012,545.58
1,997,085 .45
4,009,631.03
2,000,000.00
2,400, 000 .00
4,000,000.00
1,493,910 .00 4.200 4 .142 4.200 12/23/2019 3,553
1,491,090.00 1.550 1 .528 1.550 09/17/2012 900
2,001,880.00 4 .125 4.068 4.125 02/07/2018 2,869
1,060,940.00 4.000 3.945 4.000 04/08/2013 1,103
1,060,940.00 4.000 3 .945 4 .000 04/02/2013 1,097
979,690 .00 4.100 4 .043 4.100 05/28/2019 3,344
2,015,000.00 2 .000 1 .972 2.000 12/10/2012 984
4,132,500.00 10.350 3.987 4.043 12/10/2015 2,079
2,229,320.00 6 .790 5 .476 5 .553 05/23/2012 783
1,682,955 .00 6.000 5 .054 5 .125 03/15/2013 1,079
3,365,910 .00 6.000 4 .825 4.892 03/15/2013 1,079
1,680 ,960.00 7.140 4.892 4 .960 05/23/2012 783
3,190,890.00 4,375 5.163 5.235 06/15/2015 1,901
321,216,245.51
4 .081 4.137 1,385
2,105,160,00 3.375 3.078 3.120 11/30/2012 974
1,995,860 .00 0.875 0.938 0.952 02/29/2012 699
4,101,020.00 2 .013 2.041 837
Total lnvestments and A verage
Run Date: 04/11/2010- 19:1
333,474,360.10 331,422,070.08
345,804,402.88
3 .841 3.894 1,294
Portfolio CPA
AP
FI (PRFFI)7.1.1
Report Ver. 7.3.1
Attachment C
Investment Policy Compliance
As of March 31, 2010
1
General Investment Guidelines:
a) The max. stated final maturity of individual securities in the portfolio should be 10 years.
b) A max. of 30 percent of the par value of the portfolio shall be invested in securities with maturities
beyond 5 years,
c) The City shall maintain a minimum of one month's cash needs in short term investments.
d) At least $50 million shall be maintained in securities maturing in less than 2 years.
Plus two managed pool accounts which provide instant liquidity:
- Local Agency Investment Fund (LAIF) - maximum investment limit is $40 million
- Fidelity Investments
e) Should market value of the portfolio fall below 95 percent of the book value, report this fact within a
reasonable time to the City Council and evaluate if there are risk of holding securities to maturity.
d) Commitments to purchase securities newly introduced on the market shall be made no more than three (3)
working days before pricing.
f) Whenever possible, the City will obtain three or more quotations on the purchase or sale of
comparable securities (excludes new issues, LAIF, City of Palo Alto bonds, money market
accounts, and mutual funds).
Full Compliance
23.3%
Full Compliance
$88.5 million
$20.1 million
$0 million
103.3%
Full Compliance
Full Compliance
U.S. Government Securities:
a) There is no limit on purchase of these securities.
b) Securities will not exceed 10 years maturity.
Full Compliance
U.S. Government Agency Securities:
a) There is no limit on purchase of these securities except for:
Callable and Multi -step-up securities provided that:
- The potential call dates are known at the time of purchase;
- the interest rates at which they "step-up" are known at the time of purchase; and
- the entire face value of the security is redeemed at the call date.
- No more than 20 percent of the par value of portfolio.
b) Securities will not exceed 10 years maturity.
Full Compliance
Full Compliance
Full Compliance
Full Compliance
18.6%
Certificates of Deposit:
a) May not exceed 20 percent of the par value of the portfolio;
b) No more than 10 percent of the par value of the portfolio in collateralized CDs in any institution.
c) Purchase collateralized deposits only from federally insured large banks that are rated by
a nationally recognized rating agency (e.g. Moody's, Standard & Poor's, etc.).
d) For non -rated banks, deposit should be limited to amounts federally insured (FDIC)
e) Rollovers are not permitted without specific instruction from authorized City staff.
Full Compliance
0.1 %
Banker's Acceptance Notes:
a) No more than 30 percent of the par value of the portfolio.
b) Not to exceed 180 days maturity.
c) No more than $5 million with any one institution.
None Held
Commercial Paper:
a) No more than 15 percent of the par value of the portfolio.
b) Having highest letter or numerical rating from a nationally recognized rating service.
c) Not to exceed 270 days maturity.
d) No more than $3 million or 10 percent of the outstanding commercial paper of any one institution,
whichever is lesser.
None Held
Nvnmrm 11epcd AYxlvnenbale fl.clmenl C (New)
Y11R010 SAO PM
Attachment C
Investment Policy Compliance
As of March 31, 2010
7
8
9
10
11
12
13
Short -Term Repurchase Agreement (REPO):
a) Not to exceed 1 year.
b) Market value of securities that underlay a repurchase agreement shall be valued at 102 percent or
greater of the funds borrowed against those securities.
None Held
Money Market Deposit Accounts
a) Liquid bank accounts which seek to maintain a net asset value of $1.00.
Full Compliance
Mutual Funds:
a) No more than 20 percent of the par value of the portfolio.
b) No more than 10 percent of the par value with any one institution.
None Held
Negotiable Certificates of Deposit (NCD):
a) No more than 10 percent of the par value of the portfolio.
b) No more than $5 million in any one institution.
None Held
Medium -Term Corporate Notes:
a) No more than 10 percent of the par value of the portfolio.
b) Not to exceed 5 years maturity.
c) Securities eligible for investment shall have a minimum rating of AA from a nationally recognized
rating service.
d) No more than $5 million of the par value may be invested in securities of any single issuer, other
than the U.S. Government, its agencies and instrumentality.
e) If securities owned by the City are downgraded by either rating agencies to a level below AA it
shall be the City's policy to review the credit situation and make a determination as to whether
to sell or retain such securities.
None Held
Prohibited Investments:
a) Reverse Repurchase Agreements
b) Derivatives as defined in Appendix B of the Investment Policy
Full Compliance
None Held
All securities shall be delivered to the City's safekeeping custodian, and held in the name of the
City, with the exception of ;
- Certificates of Deposit, Mutual Funds, and LAIF
Full Compliance
Nem mom jupott Merl rams aAMthT.n1 C IHwv)
4,122010 5A0 PM