Item 15 - City's Investment Report~'O: Honorable Mayor and Members of the City Council
FROM: James L. Bowersox, City Mana~~
Peggy A. Stewart, Director ofAdminiStrative Service~
Christine Tsung, Finance Manager
DATE: May 23, 1995
SUBJECT: City' s I Report
ABSTRACT
~lonthly reports of ' are required to be presented to Council. For your
inf attached is an portfolio listing as of April 30, 1995.
A phased withdrawal of funds from the San Diego County Investment Pool proposed by the
County Treasurer is also detailed in the report.
ENVIRONMENTAL RE~lEW
E 1 review is not required for this agenda item according to CEQA guidelines
The ' portfolio earned $328,992.46 interest during April 1995.
ADDI' ~OTIFICATION AND CORRESPONDENCE
None
RECOMMENDATION
It is recommended that the City Council accept and file the City's I Report
and direct the City Manager to proceed with the Phased Withdrawal Option from the San
Diego County Investment Pool.
ACTION
I of 19
-AGENDA REPORT
CITY OF POWAY
TO: Honorable Mayor and Members~fd~ City Council
FROM: James L. Bowersox, City Manaj~e~
INITIATED BY: John D. Fitch, Assistant City~anager~
Peggy A. Stewart, Director of Administrative Services
Christine Tsung, Finance Manager
DATE: May 23, 1995
SUBJECT: s ort
BACKGROUND-
t Code Sec. 53646(b) requires the or chief fiscal officers to
make a monthly report that includes the type of date of
maturity, amount of deposit, current market value of all maturities that exceed
12 months, and interest rate.
FINDINGS
Cji folio
The book value o the ' t portfolio as of April 30, 1995 was $72,102,150
which consists o the City's general operating reserves wh ch qualify for
investment repot ing purposes. Also added to this report s a detailed schedule
of the City's an Redevelopment Agency's bond proceeds hel for payment of
inf purposes. It a book value of $4 ,085,986.
The gener 1 operating res ryes portfolio consisted of Time
Certifica es of Deposits TCDs) whi h otaled $2,667,000, Gover ment National
Mortgage ssociation Cert fic tes {.NM s) which were booked at 973,548, U.S.
Treasury otes urchased or 12,41 ,1 2, Federal Home Loan Mor ga e
Certifica es wh ch were booke at $ 17,709, medium-term Corpora e otes which
'ere oked at 2,464,015, Fe eral gency issues of $1,000,000, U.. G
e ur ies whic are booked a $7,0 9,529, a 1 paper purc ase for
9 2, 2, deposit at the Local Agenc' Investment Find (LAIF) of $ 1,491,577, and
2 ,9 ,278 ives ed through the San .iego County Investment Pool. The market
va ue of the oun y Pool increased 1. 14% and is estimated at $21,128,347 at
April 30, 199 . recap of the San D ego County Pool's Investment Portfolio as
of April 30, 995 is attached.
ACTION:
I~lAY ~ 2 1995 ITEM 15
Agenda Report
- May 23, 1995
Page 2
The values of fixed income as legal tools under
California government ode , are closely tied with interest rates. As interest
rates go up, the marke va ues of the securities go down. The difference
between book (purchase pr ce and current market price is considered an
unrealized loss (or ga n, f the market price is higher). A real (realized loss
is when the principal of he security is redeemed before it maturity date a
market value lower than i s bo k value. The book value f he rity's opera ng
portfolio is $ 2,10 ,150; the market value a us d r the San. ego
County P ol funds is $69, 43,8 7 for a "paper loss" of ,1 ,3 , or 3.0% o the
total, he book value of the ity's bond proceeds is $ ,0 ,9 ; the marke
value ad usted for the San Diego County Pool funds is $ The City does
not redeeming any of the prio~ to he r ma urity date, so
no real osses will be realized.
The funds on deposit at LAIF and the San Diego County I Pool earn
variable interest rates. The interest rate for the month ending April 1995 is
estimated at 5.959% for LAIF, and 4.74% for the County I Pool.
The TCDs are at 14 different financial institutions throughout the state. The
certificates are placed in $100,000 increments with the amounts in excess of the
first $100,000 collateralized as outlined by state law using either mortgages or
federal 9
On May 4, 1995 the San Diego Cou ty Inve tment Pool Oversight Committee
ly ap roved the implemen ation o the C unty T Phased
Withdrawal Pro osal for all Volun ary Par icipan s. The plan was also
ly en orsed by the Volun ary Par icipan s Group on May 3, 1995. The
proposal was a so reviewed by Metropolitan West ecurities, Inc. (MetWest) who
concluded that the proposal "makes sense to all parties" and confirmed the costs
as presented to the Oversight C
The Phased Withdrawal Plan proposed by the County Treasurer prov des tha all
voluntary articipants who elect to participat will be fully wi hdr wn rom the
Pool at fu 1 value by December 31, 1997, with he exception of AND G w ich
would comp ete their withdrawal by June 30, 19 8. The proposal s s ruc ured to
take advan age of the periods of projected hig liquidit' in the Poo , thereby
avoiding the sale of at a loss to create liqu dity. In the event cash
flows are not projected, the County Treasurer has commit ed to create the
liquidity to make this plan work. The Proposa will be presented to
the County Board of Supervisors for their on May 16, 1995.
3 o f 19 MAY 2 3 1995 ITEM
Agenda Report
May 23, 1995
Page 3
The City of Poway's Withdrawal Schedule would be as follows:
April 30, 1995 Investment Balance (after $5 million
pass thru transferred to County) $57,026,563
ay 1995 o o a $ , ,
· une 1995 o o a , ,
eptember 1995 o o a , ,
ecember 1995 1 o o a , ,
arch 1996 o ota $ , , 0
· une 1996 o ota , ,
eptember 1996 o ota , ,
ecember 1996 1 . o ota , ,
ecember 1996 Interest 4/1/9 to 9/30/96 , , (Estimated
March 1997 o o a $ , ,
June 1997 o o a , ,
September 1997 o o a , ,
December 1997 1 . o o a 1 , ,
December 1997 Interest lv/ / 6 to 9/30/97 4 , (Estimated
February 1998 Interest 10/1/97 to 12/30/97 (Estimated
Total 100% of Balance + Interest )63
Staff has reviewed the flow of funds from this proposal against pro ected cash
flow needs over the same period and concludes there will be adequat cash from
all available sources to meet both operating and capital needs. It s recommended
that the City of Poway elect to )articipate in the Phased Withdrawa Proposal.
ENVIRONMENTAL REVIEW
E tal review is not required for this agenda item according to CEQA
guidelines.
FISCAL IMPACT
The t portfolio earned $328,992.46 interest during April 1995.
PUBLIC AND
None
Staff Report
May 23, 1995
Page 4
RECOMMENDATION
It is recommended that the City Council accept and file the City's Investment
Report and direct the City Manager to proceed with the Phased Withdrawal Option
from the San Diego County I Pool.
Attachments:
A. I Report (Including the new computer report which lists all
the for the City. It is ~ by type of
nd li ts market value and maturity dates for all
ncl d ng those with maturity dates in excess of 12 months.)
B. sc ule detailing the ' for the bond issues managed by
he y.
C. an ego County Pool's Investment Portfolio as of April 30, 1995.
D. an ego County Investment Pool, Phased Withdrawal Proposal.
5 of 19 ~1A¥~31995
05/09/1995 PM - 1
CITY OF POWAY POWA
PORTFOLIO MASTER SUMMARY
APRIL 30, 1995
AVERAGE "-YIELD TO MATURITY---
PERCENT OF AVERAGE DAYS TO 360 365
INVESTMENTS 800K VALUE PORTFOLIO TERM MATURITY EQUIVALENT EQUIVALENT
Local Agency Investment 61.58 1 1 5.257 5.330
of 3.70 1,383 639 6.613 6.705
Mortgage Backed 1,091,257.62 1.51 10,453 7,490 8.143 8.256
Treasury Securities - 17.22 1,367 1,055 6.765 6.859
Medium Term 3.42 1,769 875 7.307 7.408
Federal Agency Issues - 1,000,000.00 1.39 1,096 891 7.111 7.210
Commercial Paper - 962,321.67 1.33 222 165 6.313 6.401
Securities - 9.85 946 219 6.543 6.634
TOTAL INVESTMENTS and 100.00% 617 385 5.847'~ 5.928%
CASH
O.OO O.OOO O.OOO
(not included in yield
Accrued Interest at 93,670.73
TOTAL 93,670.~
TOTAL CASH and
~ ~)mv'3~ The City shall invest in only those investments authorized by the State of
CHRISTINE TSUNG California under Government Code Sections 53601.1, 53602 and 53635. Investments
shall be made using the prudent man theory with given to the
DAYJ~l~I/~ fo[lowing itents in order of priority; 1. Safety; 2. Liquidity; 3. Yield.
6 of 19 J'~]AY 23 1995 ITEM 15 ,
05/09/1995 CITY OF POWAY PM - 2
INVESTMENT PORTFOLIO DETAILS - INVESTMENTS PO'WA
APRIL 30, 1905
~TMENT PURCHASE STATED --- YTM "'' MATURITY DAYS
~UMBER ISSUER DATE SOOK VALUE FACE VALUE MARKET VALUE RATE 360 365 DATE TO MAT
LOCAL AGENCY INVESTMENT FUNDS
040001 LAIF CITY OF POIJAY 5.959 5.577 5.959 1
040002 LAIF AGENCY 5.959 5.877 5.959 1
040004 SD CNTY INVST POOL .740 4.675 4.740 1
SUBTOTALS ar~ AVERAGES 5.257 5.330 1
OF DEPOSIT
010947 EAST-WEST FEDERAL BANK 9/07/94 90,00 .00 99,000.00 99,000.00 6.830 6. 6.9 09/07/99 1, 92
010948 EAST-WEST FEDERAL BANK /07/94 99,00 0 99, .00 99,000.00 6.830 6. 6. 09/07/99 1, 92
010928 FIRST INTERSTATE -SACRAMENTO /04/92 99,00 0 99, .00 99,000.00 6.300 6. 6. 03/04/ 10
010929 FIRST INTERSTATE -SACRAMENTO / 4/92 99, 0 99, .00 99,000.00 6.300 6. 6. 03/04/ 10
010951 FIRST NATIONAL SANK OF MARIN / 2/95 99, 0 09, .00 99,000.00 7.150 7. 7. 01/29/ 75
010952 FIRST NATIONAL SANK OF MARIN 0 / 2/95 99, 0 99~ .00 99,000.00 7.150 7. 7. 4 01/29/ 75
010933 FREMONT INVESTMENT &LOAN 0 / ?/92 90~ 0 99, .00 99,000.00 7.210 7. 7. 1 03/27/ 98
010934 FREMONT INVEBTMENT &LOAN 0 / 1/92 99, 99, 0 .00 99,000.00 7.060 7. 7. 5 03/31/ 7 02
010926 FRANKLIN BANK 0 / 1/92 99, 99, .00 99,000.00 6.450 6. 6. 4 02/21/ 6 98
010927 FRANKLIN BANK 0 / 1/92 99, 99, .00 99,000.00 6.450 6. 6. 02/21/ 6 98
010939 FRANKLIN THRIFT & LOAN 0 / 7/92 94, 94, .00 94,000.00 6.500 6. 6. 07/07/ 7 O0
010940 FRANKLIN THRIFT & LOAN 0 /07/92 94, 94, .00 94,000.00 6.500 6. 6. 07/07/ 7 O0
010930 FIRST REPUBLIC TNRIFT 0 /1 /92 99, 99, .00 99,000.00 6.500 6. 6. 03/11/ 17
010949 GREAT WESTERN BANK 0 /0 /95 99, 99, .00 99,000.00 6.500 6. 6. 09/29/ 5 53
010950 GREAT WESTERN SANK 0 /0 /95 99, 99, .00 99,000.00 6.500 6.5 0 6. 90 09/29/95 153
010953 IMPERIAL BANK 0 /1 /95 99, 99, .00 99,000.00 6.650 6. 0 6. 2 09/15/95 139
010954 IMPERIAL BANK 0 /1 /95 99, 99, .00 99,000.00 6.650 6. 0 6. 2 09/15/95 1~9
~943 IMPERIAL THRIFT 0 /1 /92 99, 99, .00 99~000.00 6.250 6. 0 6.337 08/18/97 842
54 IMPERIAL TBRIFT 0 /1 /92 99, 99, .00 99,000.00 6.250 6. 0 6.337 08/18/97 842
0,u931 RIVER CITY BANK 0 / /92 100, .0 100, .00 100,000.00 7.300 7. 0 7.401 03/20/97 691
010932 RIVER CITY SANK 0 / /92 100, .0 100, .00 100,000.00 7.300 7. 0 7.401 03/20/97 691
010945 SAN DIEGO FIRST SANK 0 / /94 99, .0 99, .00 99,000.00 6.200 6. 0 6. 8<5 03/30/99 1,431
010946 SAN DIEGO FIRST SANK 0 / /94 99, .0 99° .00 99~000.00 6.200 6. 0 6. ~ 03/30/9<) 1,431
010937 SARATOGA NATIONAL SANK 0 / /92 99,00 .00 99,00 .00 99,000.00 6.500 6. 0 6. 90 06/03/96 401
010938 SARATOGA NATIONAL BANK 06/ /92 99~00 .00 99,00 .00 99,000.00 6.500 6.500 6. 90 06/03/96 401
010941 TRAMS PACIFIC NATIONAL SANK 08/ /92 100~00 .00 100,000.00 100,000.00 6.250 6.250 6. 37 08/12/97 836
010942 TRAMS PACIFIC NATIONAL BANK 08/ /92 100,00 .00 100,000.00 100,000.00 6.250 6.250 6. 37 08/12/97 836
SUBTOTALS ar~J AVERAGES 6.613 6.705 639
MORTGAGE SACKED SECURITIES
080001 FED HOME LOAN MTG CORP 09/17/~ 2 ,66 . 9 3 ,408.49 30,224.21 8.000 8.784 8.906 08/15/06 4,126
080003 FED HOME LOAN MTG CORP 04/20/87 8 ,04 . 0 9 ~692.70 92,671.61 9.000 9.137 9.2~ 05/01/16 7,673
081008 GNMA POOL 192832 04/20/87 59 ,39 . 2 60 ,399.52 600,009.26 8.000 7.958 8.069 04/15/17 8,022
081007 GNMA POOL 203379 04/20/87 26 ,80 . 6 26 ,969.56 265,796.68 8.000 8.001 8.112 04/15/17 8,022
081001 GNMA POOL 13057 08/11/~5 11 ,34 . 5 11 ,023.28 117,780.42 8.000 8.503 8.621 08/15/06 4,126
SUBTOTALS and AVERAGES 1,091,257.62 1,104,493.55 1,106,482.18 8.143 8.256 7,490
* Market value of $ ,
7 of 19 IAY g3 1995 ITEM 15 .,, t
05/09/1995 CITY OF POWAY PM - 3
INVESTMENT PORTFOLIO DETAILS - INVESTMENTS P(TWA
APRIL 30, 1995
IHVESTMEHT PURCHASE STATED '-- YTM "' MATURITY
NUMBER ISSUER DATE BOOK VALUE FACE VALUE MARKET VALUE RATE 360 365 DATE TO MAT
TREASURY SECURITIEE ' COUPON
070001 US TREASURY NOTE 09/25/90 497,968.75 500, 00.0 503,595.00 8.500 8.484 8. 02 08/ 5/95 1
070002 US TREASURY NOTE 4/12/94 488,671.8~ 500, 00.0 483,905.00 5. 75 6.323 6. 11 03/ 1/99 1,4
070003 US TREASURY NOTE 4/21/94 483,593.75 500, 00. 483,905.00 5. 75 6.568 6. 59 03/ 1/99 1,4
070004 US TREASURY NOTE 5/06/94 989,218.75 1,000, 00. 988,440.00 . O0 .664 6. 6 04/ /99 1,4
070005 US TREASURY NOTE 6/02/94 499,687.50 500, 00. 498,280.00 . 5 .672 6. 5 05/ /99 1,4
070006 US TREASURY NOTE 7/12/94 494,296.8~ 500, 00. 498,125.00 . 5 .927 7. 24 06/ /99 1,5
070007 US TREASURY NOTE 0 /12/94 499,453.13 500, 00. 498,905.00 .50 .453 6. 43 05/ /97 ?
070008 US TREASURY NOTE 0 /09/94 4 ,765.63 500, 0 500,155.00 7 .792 6. 86 07/ /99 1,5 4
070009 US TREASURY NOTE /15/94 4 ,984.38 500, 498,280.00 .485 6. 75 08/ /97 9
070010 US TREASURY NOTE /15/94 4 ,593.75 508, 500,155.00 .847 6. 2 07/ 1/99
070011 US TREASURY NOTE /15/94 4 ,671.68 500, 498,280.00 .508 6. 9 08/ 5/97
070012 US TREASURY NOTE /09/94 5 ,156.25 500, 498,280.00 .399 6. 8 08/ 5/97
070013 US TREASURY NOTE /13/94 4 ,437.50 500, 498,280.00 .528 6.6 9 08/ 5/97
070014 US TREASURY NOTE /13/94 4 ,640.63 500, 500,155.00 .940 7.0 08/ 1/99
070015 US TREASURY NOTE /20/94 4 7,500.00 500, 498,280.00 .600 6.6 08/ 5/97
070016 US TREASURY NOTE /20/94 49 ,921.88 500, 500,155.00 .023 7.1 O8/ 1/99 1,
070017 US TREASURY NOTE /23/94 49 ,484.3 500, 498,280.00 0 6.678 6.7"7 08/ 5/97
070018 US TREASURY NOTE /23/94 49 ,828.1 500, 500,155.00 7.075 7. 08/ 1/99 1,
070019 US TREASURY NOTE /30/94 99 ,656.2 1,000~ 996,560.00 0 6.692 6. 08/ 5/97
070020 US TREASURY NOTE /30/94 1,00 ,000.0 1,000, 1,000,310.00 6. 0 6.411 6. 09/ 0/96 0
070021 US TREASURY NOTE 1/08/94 49 ,828.1 500, 502,500.00 6.875 6.908 7. 10/ 1/96
070022 US TREASURY NOTE 2/08/94 49 ,812.5 500, 505,155.00 7.250 7.389 7. 11/ 0/96 1
SUBTOTALS and AVERAGES 6.765 6.859 1,055
MEDIUM TERM NOTES
090032 EF HUTTON GROUP INC 06/17/91 493,635.00 500,000.00 507,810.00 8.875 9.075 9.201 05/01/96 '~68
090037 FORD MOTOR CREDIT CC~MPANY 03/09/94 972,8~0.00 1,000,000.00 946,900.00 5.625 6.192 6.278 01/15/99 1,357
090035 PHILLIP MORRIS 03/26/92 497,500.00 500,000.00 502,735.00 7.500 7.517 7.622 03/15/97 686
090036 TRAVELERS CORP 05/14/92 500,000.00 500,000.00 501,600.00 7.625 7.521 7.625 01/15/97 627
SUBTOTALS and AVERAGES 7.307 7.408 875
FEDERAL AOENCY ISSUES - COUPON
061009 FED HOME LOAN MTG CORP 10/06/94 1,000,000.00 1~000~000.00 1~001,250.00 7.210 7.111 7.210 10/06/97 891
COMMERCIAL PAPER - DISCOUNT
050001 GENERAL ELECTRIC CAPITAL CORP. 03/03/95 962~321.67 1,000,000.00 962,321.67 6.349 6.313 6.401 10/11/95 165
SECURITIES - COUPON
100011 FIDELITY GOVERNMEHT SECUR FUND 0 /08/94 500,000.00 500,000.00 463,972.74 6.600 6.510 6.600 02/08/96 85
100012 FIDELITY GOVERNMENT SECUR FUND 0 /09/94 1,000,000.00 1,000,000.00 926,141.89 6.587 6.497 6.587 02/09/96 86
100013 FIDELITY GOVERNMENT SECUR FUND 0 /11/94 1,000,000.00 1,000,000.00 926,141.89 6.587 6.497 6.587 02/11/96 88
100014 FIDELITY GOVERNMENT SECUR FUND 0 /22/94 500,000.00 500~000.00 468,534.90 6.665 6.574 6.665 02/22/96 99
100015 FIDELITY GOVERNMENT SECUR FUND 0 /23/94 500~000.00 500,000.00 469,921.11 6.684 6.592 6.684 02/23/96 O0
8 o f 1 9 ~'IA¥ 2 3 1995 ITEM 15
05/09/1995 CITY OF PO~AY PM - 4
INVESTMENT PORTFOLIO DETAILS - INVESTMENTS PC~A
APRIL 30, 1995
~TMENT PURCHASE STATED --- YTM --- MATURITY OAYS
NUMBER ISSUER DATE BOOK VALUE FACE VALUE MARKET VALUE RATE 360 365 DATE TO MAT
SECURITIES ' COOPON
100002 US GOVERNMENT FUND 10/30/8 699,529.20 699,529.20 720,637.36 8.000 7.890 8.000 10/30/95 184
100003 US GOVERNMENT FUND 07/22/9 50 ,000.00 500,000.00 471,808.93 6.500 6.411 6.500 07/22/95 84
100004 US GOVERNMENT FUND 08/13/9 0 ,000.00 200,000.00 186,821.71 6.500 6.411 6.500 08/13/95 106
100005 US GOVERNMENT FUND 08/24/9 5 ,000.00 250,000.00 232,805.25 6.500 6.411 6.500 08/24/95 117
100006 US GOVERNMENT FUND 09/10/9 . 0 ,000.00 300,000.00 277,436.68 6.200 6.115 6.200 09/10/95 134
100007 US GOVERNMENT FUND 09/28/9 0,00D.O0 500,000.00 463,461.53 6.250 6.164 6.250 09/28/95 152
100008 US GOVERNMENT FUND 10/08/9 0 ,000.00 400,000.00 370,484.24 6.230 6.145 6.230 10/08/95 162
100009 US GOVERNMENT FUND 10/12/9 400,000.00 400,000.00 370,769.23 6.230 6.145 6.230 10/12/95 166
100010 US GOVERNMENT FUND 11/12/9 350,000.00 350,000.00 328,721.75 6.310 6.224 6.310 11/12/95 197
SUBTOTALS and AVERAGES 7,099,529.20 7,099,529.20 6,677,659.21 6.543 6.634 219
TOTAL INVESTMENTS and AVERAGES $ 71,725,748.00' 5.847% 5.928% 385
*Market value adjusted for San Diego County Pool funds $69,943,817
05/09/1995 PM - 5
CiTY OF PO~AY POWA
ACCRUED INTEREST DETAILS
APRIL 30, 1995
Interest Collected $ 88,883.88 $ 1,226,435.08
PLUS Accrued Interest at End of Period 367,425.60 367,425.60
LESS Accrued Interest at Seginning of Period ( 307,433.10) ( 224,019.42)
Interest Earned during Period $ 148,876.38 $ 1,369,841.26
Mortgage gackod Securities:
Interest Collected $ 7,462.00 $ 78,028.39
PLUS Accrued Interest at End of Period 19,827.94 19,827.94
LESS Accrued Interest at Beginning of Period ( 19,851.52) ( 20,579.90)
Interest Earned during Period $ 7,438.42 $ 77,276.43
interest Collected $ 239,596.92 $ 1,858,115.22
PLUS Accrued Interest at End of Period
LESS Accrued Interest at Seginning of Period ( (
Interest Earned during Period $ 172,677.6<5 $ 1,656,155.08
TOTAL Interest Earned during Period $ 328,992.46 $
1(] of 19 J~'~IAY g$ 1995 ITEM 15
MARKET
BOOK VALUE VALUE
$ $ $ 4.740
4.740
4.740
TOTAL
FUND:
5.959
1990A 336,374.13 336,374.13 336,374.13 5.959
48,063.70 48.063.70 48.063.70 5.959
TOTAL
BOND $99.754.73 $99,754.73 $99.754.73 5.550
1990A 436,128.86 436,128.86 436,128.86
O,~ '~ND495
11 of 19 )'~IAY 23 1995 IT~.~ 15
COUNTY OF SAN DIEGO
CHIEF ADMINISTRATIVE OFFICE
DATE: May 16, 1995
TO: Board of $
SUBJECT: PROPOSED PHASED WIlliORAWAL OF VOLUNTARY FROM TWE
COUNTY'S POOLED CASH FUND
SUMMARY:
Issue
Should the Board o? S concur with the San Diego County
I Pool Oversight C approval o? the T s proposal
for a phased withdrawal of Voluntary Participants from the San Diego
County's Pooled Cash Fund.
Recamendation
CHIEF ADM!~ISTR~TiVE OFFICER:
Concur with the San Diego County Pool Oversight s
reco~endation to adopt and approve the phased withdrawal of voluntary
Fiscal Impact
Based on the Hay 4, 1995, report of the Financial Advtsor,
West Inc. (MetWest), to the San Diego County Pool
Oversight (attached), the this proposal
would cause a projected interest yield reduction of 5 basis points (.05
percent) { Lely $1.2 million) to the County's share (all County
funds) of the Pooled Cash Fund over a Z.B year phaseout period.
This projected interest yield reduction assumption is based on the current
interest rate and the withd awol of all funds on
the specified ares and in the amounts as shown in the attach d
Proposed Participant Phased 1 This yle d
reduction wil vary based upon t e interest rate
Specifically, f interest r~tes rise, he interest yield reduction wi 1
If interest rates fall, the interest yield wi 1
~e impact of this proposal will be factored into the interest
earnings projected for Fiscal Year 199B-96 and will be incorporated into
the Proposed Policy and Program Budget.
D
13 of 19 ~lAY 2 3 1995 ITEM 15
SUBJECT: PROPOSEO PHASED WITHDRAWAL OF VOLUNTARY PARTICIPANTS FROM THE
COUh~FY'$ POOL£~ CASH FUND
BACKGROUND:
On May 4, 199S the San Diego County I Pool Oversight
ly approved the impl of the County' s Phased
Withdrawal Proposal for all Voluntary P ' ' ts based on its unanimous
by the Voluntary participants on May 3, 1995. Under this
proposal (attached}, all Voluntary . who elect to
in the phased withdrawal would be fully from the Pool at full
value by Oecember 31, 1997, with the of SANDAG which would
complete their 1 by June 30, 1998.
Since December 1994 the Mandatory and Voluntary participants of the Pool
and the County TKeasurer have worked collectively as a gro p throd~h the
Pool and San Diego County I o~l Oversight
Committee to insure the safety of their principal investe in the Pool.
During this period, there has been a set of wi hdrawal rules
placed upon the Voluntary to prevent a 'run on the Pool
while a manageable solution to the withdrawal issues could be resolved.
The San Diego County I Pool Oversight Committee has reviewed
several possible solutions to this issue and has concludeU that the
s Phased Withdrawal Proposal presents the best possible solution
for all parties This proposal will be of mutual benefit to both
voluntary and It allows voluntary
the flexibility to structure their cash needs for 1 and
purposes while taking advantage of peak cash ltquidtt7 periods
to minimize the impact of the cash withdrawals on
To further validate the Proposal, the San Diego County Investment Pool
Oversight Committee contracted with Metro¢olitan West Inc.
~MetWest) to review the Proposal to first ensure that it is wortable and
second to identify the cost to the Mandatory P MetWest
concluded that the pro osal "makes sense to all parties" and confirmed the
costs as to he It is expected that the cost of this
proposal to the Monde Dry P will be a in interest
earnings of approxima ely $2.7 million in the current interest rate
over the .S year period of the phased 1. The
proposal not only prov des the Voluntary Participants with timeltnes for
from the Pool, but it also does so while providing liquidity
for all p without the projected sale of at a loss to
create liquidity.
The Treasurer is currently soliciting Voluntary P election of
the Options included in the Phased Withdrawal Proposal.
14 of 19 ~IAY g:3 1995 ~TEM 15 ,
BOARD OF
AOEkNDA ITEl(
INFOIU(ATZON SHEET
SUBJECT: PROPOSED PHASED WITHOP. AWAL OF VOLUNTARY PARTICIPANTS FROM THE
COUNTY'S POOLED CASH FUND
SUPV. :IST.: All
COUNTY COUNSEL APPROVAL: Form and Legality ( ) Yes (X) N/A
( ) Standard Form ( ) Ordinance ( ) Resolution
CHIEF FII~CNCIAL OFFICER/AUDITOR APPROVAL: ( ) N/A (~)'-Yes
4 VOTES: { ) Yes ( ) No
CON~I~ACT RE'VIEW PANEL: ( ) Approved
PREVIOUS RELEVANT BOARD ACTION: N/A
BOARD POLICIES APPLICABLE: N/A
CITIZE~ COHI~ITTEE STATEMENT: On May 4, 1995, the San Diego County
Pool Oversight Committee ly adopted and approved the Treasurer'; Phased
1 Proposal as discussed and amended.
CONCURREHCES: ,/Tax Collector
ORIGII~TIN~ DEPARTI~EI~T: Auditor and Controller
COffI'ACT PERSON~ Robert Booker, Ed.D. (S30-5413)
Chief Financial Officer/Auditor and Controller
DEPARTMENT AUTHORIZED REPRESENTATIVE MEETING DATE
) IAY 2 3 1995 ITE).,) 15
15 of 19
SAN DIIEGO COUNTY Ilq'VES~ POO1_
PtlASED ~RAWAL I:~ROPOSAL
I. Deposit. No fu~u~ ~mpom~ an: proj~t~ ~om Vol~ P~¢ip~u' =~ ~¢ for
~on ~m ~B ~ ~y ~d lun~ 199~ ~d $36 ~on ~om S~AG b~?*~ May 1995
~d Ap~ 1996. ~y ~cn~ may m~ ~Ro~ d~siu into ~c P~i a~ ~y Omc.
~on~ d~siu wo~d be ~ m ~c ag~cy u~n five (5) wor~g days notice
or ~ew pr~e~s.
2. Wi~. Wi~dmw~a to ~ P~cip~u who ~t ~ p~cipate ~ ~e
would be ~e u~mg ~g ~h~ SC~ OF ~~w~ PA~N~S, ,~
~mw~ ~d ~e co~e~nd~g ~c~mge payout ~ be b~ u~n ~ch agency ~
of Ap~ 30, 1995. ~ore, on ~ch <h~ul~ paym~t ~ ~h ~en~ ~ ~ve ~t
p~c~t of ~ b~ce ~ of Ap~ 30, 1995. ~ ~ ~ent ~ agency to p~cipam m
· e Pro~ is fac~ ~i~ ~ ~b~oMm n~ for op~g ~nds before z <h~ payment
~d ~ ~ ~ av~able Mnd$ ouuide ~c P~I ~e M~ to a ~ (30) ~y
· ey wo~d ~ ~ow~ ~ ~i~w ~e n~ ~nds, provM~ ~at ~e P~I h~ suf~i~at
for [~: ~ Howler, ~ ~ubs~uent mh~ul~ wi~dmw~s wo~c Oc ~uc< or
~ffi such ~me ~ ~ ag~gam ~w~s ~ b~k on sch~c ~ ~
pamcipmu. S~ ~ is Mn~ble, "awilnhle hnds" wo~d be de~ ~ =y ~nds of ~e
~gency. ~y exc=p~on to ~s ~cy would ~uk~ ~ appm~ af ~u Ov~ight
Comm~.
3. wi~w~ EiCon. Agencies wM~ p~ci~m m ~s pro~ may e!<t to have
sch<ul~ ~d~w~ paymenU y ~cnt m ~ b~ or Mve ~e paym~m mm~
P~I. ~ ~e ev~t ~ ag=cy M~ m have ~e paymen~ mmm in ~e P~I. ~ey would have
~c ab~ m ~dmw ~ "b~' ~ngs u~a ~ (30) ~ys noUce ~¢out ~y
or ~.
4. ~t~ D~buflon. ~$t ~ be c~ q~ly m ~h ag~cy's nmd ~ nom~.
~t~t ~gs be~ Apffi 1, 1995 ~d S~mmb~ 30, 1996 ~ be (arable for
~m ~e P~O M D~mb~ 1996. ~ be~n ~mb~ 1, t996 ~d
S~temb~ 30, 1~7 w~ b~ di~bu~ ~ D~embcr 1997. htmst ~M be~n October
I997 ~d D~emb~ 30, I~7 w~ be dis~but~ ~ Feb~ 1998.
5. G ~e T~ ~ ~d ~¢ ~ght Com~ ~
~at he ~B ~m ~e n~ ~qm~ to m~ ~: pl~ work. ~ ~on ~s P~
be p~n~ to ~e Coun~ ~d of 5u~imrs for ~eR on May 16. 1995.
COUNTY OF:: 8AN DIEGO
16 o f 19 IvIAY 2 3 1995 |'r~ 15
6. Pe. nmanent Withdrawal Rule. For any ag~n¢~ ~ to participat~ in this Proposal,
the Withdrawal Rulta shnl! be replaced with the single followin,, Rt~i=:
Withdrawal will b~ permit~t only for those agc-ncies which can d' that ~hcv have
absolumly no funds available out.~id¢ the Pool except for a thirty (30) day ot~raang rede. rye. Since
~ is fungible, "avallabl~ funds" will be defined as any funds of thc agency. ALI
will be subject to the review of the Withdrawal Review Group. The withdraw'a/rule :hall remain
m ~/-fec: 1998, the completion date of the Phased WithcLrawal. Reg~d/c~s of ~he
Option chosan by an agenc'y, all future deposits shall be hancLl~d La , uath lam i above.
?. G ' lencies. The grancifatktred agencies, including the . Colleges,
who usa ac se..wic~ of thc County to k~p their :=cords and/or issue for the
a§e. ncy can continue to function 100% in this will be tItateg a.s a mandatory
parU~pant (ukis a~ium~s ~ha[ uhe agency shall continue to make the. ar dq~osits mm ~¢ Pool). They
cam a/au opt to be treated as a voluntary agency and elect :0 partl¢ipa:~ in the Withdrawal Proposal
m the m~rn¢ fashion a.s the otb y agencies. However, any agency so opung shall be
subject to all of the placed upon the otb . age,ncics, including me
Withdrawal Rule. and would ~_,'J~__ tu s~t up their own and check issum§!clearm§
system.
8. Additional Options. Any volunl:ary agency, including grandf'athr..red age~cies, which
ini~ally e/ecu not to parucipat= in the Pha.~d Withdrawal may later opt for the Phased
Withdrawal. Such agencies e/coting phased withdrawal would be placed on the Phased
Sch~ule, ra~rlg into accour, t their d~i~osir, s and withdrawals to April 30, 1995. Any
volunra~-y agency shall at aJ/ times have the option to withdaaw at mazket or withdraw a b~ular of
in-kind secuntie~ which woul~l approximat~ the market value and coupon y/eld of the Pool, but no
so:uriti~ would be included that mature before lun¢, 1997.
9. St. art Date. All agencies el~;xing to par~icipat= in this Proposal will rcc~,.,e ' '
payment within five (5) working days afxr~ i~aipt of the Ejection Form by the Tre~urem Office,
but no earl/= than May 18, 1995.
10. A_qs~lmption. The withdrawal schedule w~s prepared with thc assumption that th= County
and Schools wi.il issue TRAN$ and Teernr Notr. a as projecmcl in the caah flow proj=aons and that
the set a.Ud~ for the Notea will be made with their third pan7 uust=:s bl, the Schools in December
and May and by thc County in December, April, May and June.
17 of 19 MAY ~2 199S !~ 15
SCHEDUI-F~ OF ~~W~ PA~S
Wi~w~ ~d~ ~s pr~ s~ be ~e ~ ~ Vol~
15~ bu~s ~y of ~ch mon~. ~ch P~cip~t so ~g m p~cipa~ ~ ~e Pro~ s~
ag~cy ma~ r~mv~ ~ ~ payment und~ ~s p~ sh~ nol be ~mfl~ to ~ese
~h~e for ~ Volun~ P~ci~m o~
m~ b~ow. ~e ~o~ : for ~h ~ is ~e m~ ~o~t ~a~ would be
Mon~
M~h 2.62~ ($13m) 5.12% ($25m)
lune 5.2~ ($26m) 5.12~ ($2~m) 5.91%
S~=mber 5.25~ ($26m) 6.82~ ($33m) 7.87~ t$39m)
To~ 25.24% ($12~) 34.11% ($167m) 39.~%
~e~ amounu ~m~nt ~e b~s of ~e Voi~ P~Up~u ~ of Ap~ 30, 1995 w~ch
~ff= kom ~e ~h 30, 1995 6~ by ~e ~uc~on of $~3.8 million ~ch w~ ~ to -
p~ap~u =d ~e ~clu~on of $106.a for ae Commum~ CoHeg~.
~e ~h~ule for S~AG ~d ~B for ~ ne~ wi~ ~ fo~ows:
I~ $ $ 6,850,439
~h 18,5~,814 15,205,881
Ap~ 31,9~,239
May 1~,828,~39
f~y 15,085,~39
Augus~ la,275,439
S~b~ 7,2~,~26 9,992,~9~ 10,5~2,67~
Novcmb~ 5,9~,439
D~mb~
To~ $108,~,750 $95,~8,708 ~9,236,861
S~AG's ~m~g b~ of $53 ~on (1
199B,
SAN DIEGO COUNTY INVES~ POOL
d~ m ~pa~ ~ ~e Ph~ Wi~w~ Prog~ ~ de~nb~ m ~e
p~. W= ~at ~y ~di~o~'wi~dmw~s r~ues~ abov~ a~d b~yond
· c Sch~,,l-~ Pzym~ ~ ~ subj~ m comp~ ~ ~e P~t Wi~w~
K~e ~fl ~ ~u~ or e~a~ Sch~ul~ Paym~ ~ such ame a o~
~ on ~h~e.
We ~sh ~ have o~ Sch~ul~ Pa~ ~t ~ us on
· e Sch~ P~ym~t Da~.
We ~sh ~ have o~ Sch~ul~ ~ymen= h~d m ~e Co~,T T~.
~e S~ Paym~n~ d~ ~ o~ '. be arkie
for ~w~ by o~ Ag~c7 ~ ~ (30) ~ys no~.
~ O~ON ~. ~e
d~s not de~ ~ ~cipa~ ~ ~e P~ Wi~w~ ~og~ ~ d~b~ in ~e
a~h~ pr~. We ~ ~t ~ wi~s ~u~ by o~ Agency
~ OPx'ION 3. ~e
~ ~w o~ ~ b~ ~ ae P~I at ~a ~t vaue ~ of Ap~ 30, 1995.
~ O~ON 4. ~e
~ue ~ of Ap~ 30, 199~. It ~ und~st~ ~ ~s s~ be a sm~ b~et of m-
~d ~fi~ ~t appm~mams ~e m~k i cou~n yi~d of ~e P~I but
d~ not ~ude ~ ~at ma~ befo~ June 1997.
Print N~,ne
Sig.q ~t-~um
PAUL BOLAND
TREASLIR.F_.R-TAX COt
Title
Date Dam
19 of 19 ~,iAY 23 1995 ~T~M 15 ,