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Home My WebLink About07-25-11 Fiscal Affairs Committee MeetingCITY OF LA PORTE FISCAL AFFAIRS COMMITTEE MEETING AGENDA Notice is hereby given of a meeting of the City of La Porte Fiscal Affairs Committee to be held on Monday, July 25, 2011, at 5:00 p.m., in the La Porte City Hall Council Chambers, 604 West Fairmont Parkway, La Porte, Texas, regarding the items of business according to the agenda listed below: 1. Call to Order 2. Consider approval of minutes of the June 20, 2011, meeting of the Fiscal Affairs Committee — P. Fogarty 3. Receive and review Third Quarter (FY 2011) Investment Report — M. Dolby 4. Discuss firms for independent auditor services and determine which of those will have interviews — M. Dolby 5. Administrative Reports — R. Bottoms 6. Committee Comments — Matters appearing on agenda; Recognition of community members, City employees, and upcoming events; Inquiry of staff regarding specific factual information or existing policy. 7. Adjourn In compliance with the Americans with Disabilities Act, the City of La Porte will provide for reasonable accommodations for persons attending public meetings. To better serve attendees, requests should be received 24 hours prior to the meetings. Please contact Patrice Fogarty, City Secretary, at 281.470.5019. CERTIFICATION I certify that a copy of the July 25, 2011, agenda of items to be considered by the Fiscal Affairs Committee was posted on the City Hall bulletin board on July 22, 2011, at 9:30 a.m. Sharon Harris, Assistant City Secretary I certify that the attached notice and agenda of items was removed by me from the City Hall bulletin board on the day of 1 2011. Name and Title Page 1 of 1 July 25, 2011, Fiscal Affairs Committee Agenda CHUCK ENGELKEN, CHAIR Councilmember District 2 DARYL LEONARD Councilmember District 3 TOMMY MOSER Councilmember District 4 JAY MARTIN Councilmember District 5 JOHN ZEMANEK Councilmember At -Large A MINUTES OF MEETING OF FISCAL AFFAIRS COMMITTEE JUNE 20, 2011 The Fiscal Affairs Committee met on June 20, 2011, at 5:15 p.m. in the La Porte City Hall Council Chambers, 604 West Fairmont Parkway, La Porte, Texas, to consider the following items of business: 1. Call to Order Chairman Chuck Engelken called the meeting to order at p.m. Committee Members present were Councilmember District 3 — Daryl Leonard, Councilmember District 4 — Tommy Moser, Councilmember District 5 — Jay Martin, and Councilmember At -Large A — Zemanek. 2. Consider approval of minutes of the Meeting held on June 13, 2011, of Fiscal Affairs Committee — P. Fogarty Committee Member Moser moved to approve the minutes of the meeting held on June 13, 2011, of the Fiscal Affairs Committee as presented. Committee Member Martin seconded. MOTION PASSED. Ayes: Chairman Engelken, Martin and Zemanek Nays: None Committee Members Moser, Leonard 3. Consider approval or other action regarding the proposed list of firms to receive the City's RFP (request for proposal) for independent auditor services and review of RFP document for independent auditor services and proposed timeline — M. Dolby Director of Finance Michael Dolby presented the proposed list of firms to receive the City's RFP (request for proposal) for independent auditor services, reviewed the RFP document for independent auditor services, and provided the proposed timeline. Committee Member Zemanek questioned if alternate members of the Fiscal Affairs Committee were allowed to vote on items. Staff was directed to inquire with the City Attorney's Office and confirm the role of alternate members on the board. Committee Member Moser informed Mr. Dolby he does not want Belt Harris Pechacek to be entertained for independent auditor services. Committee Members Leonard and Zemanek agreed with Committee Member Moser. Director of Finance Michael Dolby reviewed the following proposed timeline with the committee members. The advertising dates for the RFP are June 16 through June 23. On June 21, RFPs will be distributed. July 12 through July 22, RFPs will be reviewed by staff. On July 25, staff would like to meet with committee members and discuss firms for interviews. Mr. Dolby asked how many firms would the committee would like to interview. Page 1 of 2 June 20, 2011, Fiscal Affairs Committee Minutes The committee members agreed to interview five firms and to meet on August 2, commencing interviews at 3:00 p.m. Interviews will be thirty minutes apart, and the interviewing should conclude by 6:00 p.m. At the August 8 City Council Meeting, the committee will recommend an auditing firm to the full Council. Michael Dolby was asked to provide the grading sheet to the committee. Committee member Leonard had questions on the evaluation worksheet and asked whether some parts are subjective. Mr. Dolby answered yes. The contract will be awarded the last Monday in August. The Council budget workshop meetings are August 8 through August 12, beginning at 6:00 p.m. 4. Administrative Reports — R. Bottoms Mr. Dolby reported city of La Porte sales tax entities are audited on a quarterly basis. The firm drives the streets and conducts an audit. The State of Texas sales tax is 6.25 %, the City of La Porte is 2 %. The City has received payment back for the automated meters. Mr. Dolby reported 2010 water loss and will provide a report at a future meeting on 2011 water loss. Committee members requested to receive the sales tax report on a quarterly basis. 5. Committee Comments — Matters appearing on agenda; Recognition of community members, city employees, and upcoming events; Inquiry of staff regarding specific factual information or existing policy. There were no Committee comments. 6. Adjourn There being no further business, Committee Member Moser moved to adjourn the meeting at 5:54 p. M. Respectfully submitted, Patrice Fogarty, City Secretary Passed and approved on the 20 day of June, 2011. Chairman Chuck Engelken Page 2 of 2 June 20, 2011, Fiscal Affairs Committee Minutes CITY OF LA PORTE Interoffice Memorandum TO: Chuck Engelken, Councilmember Tommv Moser, Councilmember Daivl Leonard, Councilmember John Zemanek, Councilmember Jav Martin, Councilmember Ron Bottoms, City Manager Traci Leach, Assistant City Manager FROM: Michael Dolby, Director of Finance Shelley Wolny, Treasurer DATE: July 7, 2011 SUBJECT: Quarterly Investment Report For the third quarter of the 2011 fiscal Near, the City s investment portfolio yield has been between 0.26% and 031 %. The average return on the portfolio for the third quarter of the fiscal Near was 0.28 %, which is above the average yield of our benchmark, which was 0.10% (see graph below). Our benchmark is the 6- month T -Bill rate. The Near to date interest earned for the 2011 fiscal Near for all funds was $129,338 which is approximately 39% of the $335,000 budgeted for the Near. City vs. Benchmark Portfolio Yield Benchmark At June ) the City s portfolio consisted of 70% in Texpool, 13% in Agency Notes, 15% in Certificates of Deposit, 1% in TexSTAR and 1% in Logic (see pie chart below). The most current overnight rate was set on December 16, 2008 at 0.00% to 0.25 %. At the end of the third quarter, the City s portfolio consisted of 72% of the portfolio maturing overnight (see graph below), 15% of the City s portfolio matures in 1 -12 months, 11% maturing in 12 -24 months and 2% maturing in 24 -36 months. CurrentIv, the 3 -month T -Bill is at 0.04 % 2 -Near, at 0.41% 5 -Near, at 1.58% and, the 20 -Near is at 3.91% see yield curve below). The overnight rate is currently at 0.00% to .25 %. We will continue to focus on laddering the portfolio to maintain a constant cash flow and a liquid position. 2 In summaiv, we will continue to invest the City s funds in conservative investments, as authorized by the Public Funds Investment Act, alwaN-s keeping in mind Safety first, and then Liquidity and lastly Yield. Portfolio Composition and Value as of .June 30, 2011 Investment Maturity Schedule as of .June 31, 2011 Par Boole Market Dav to Percent Value Value Value Maturity Investment Pools 4-'A59-2 '0 414 220 42A59?20 1 Agencies 8 .000.000 8.000.000 8.01'.'39 6 -8 Certificates of Deposit &5WOOO &621645 &6- 206 Total X8959,"'"'0 59,081365 59.099.604 I_" Investment Maturity Schedule as of .June 31, 2011 Oveuught Boole 6.00 Portfolio Performance Value Percent Overnight 41459, -1.8?% 1 -I_' months 8,6- 14 Woo 1= Sears 6,500000 11.00o--o 2 -3 Sears 1,500000 2 Total 59,08136 100.00 Oveuught 0 --0 of hunt, invested in Securities Nc Pools Bank Depo itory Total o of fields Invested Operating Account Balance Average for Tune '011 2010 )s 64 96 35o 4 4640 3 65o 100.00o-o 100.00o-o 1693, 93,'23 2'036 Pooled Fund, Board Fund, Total ®Portfolio Yield ®Rendunarl<Yield* Get-,I F terp -e Intemzl Service Otho Fun& ®BudLet ®Actual R'AAl - Pooled Funds 6.00 Portfolio Performance Portfolio Earnings 6.00 for the month of .June 30, 2011 as of .June 30, 2011 4.00 ry„ fit }S Weighted 100 °%o zif:, Portfolio Benchmark Average Budget Actual Yield Yield* Maturity 0 80o Pooled Funds 0?6 0l0o--0 4.46months 0 60o Bond Funds 0.08 0.04 1 daV 100.000 Internal Service 39,000 15918 0.4040 Total 0.17 0.07 4.10 months U 20oo 4Z.' 140 *The pooled funds benchmark Is based on the average montlilv vield of a 6 -month Treasury 0 00o The bond funds benclunarlc vleld Is based on the average montlilv vleld of a 3 -month Trea arrv. The total Is based on weighted average montlilv benclunarlc vlelds. 0 --0 of hunt, invested in Securities Nc Pools Bank Depo itory Total o of fields Invested Operating Account Balance Average for Tune '011 2010 )s 64 96 35o 4 4640 3 65o 100.00o-o 100.00o-o 1693, 93,'23 2'036 Pooled Fund, Board Fund, Total ®Portfolio Yield ®Rendunarl<Yield* Get-,I F terp -e Intemzl Service Otho Fun& ®BudLet ®Actual R'AAl - Pooled Funds 6.00 Portfolio Earnings 6.00 as of .June 30, 2011 4.00 ry„ fit }S zif:, 200.000 r sst+ r Budget Actual Percent 150.000 General 162500 52382 2'4o --b 1.00 Enterprise 27,100 10278 3792 ° --b 100.000 Internal Service 39,000 15918 40.81 Other Frmds 106A00 50,'61 4Z.' 140 5M00 Total 33Too 1_ 38.61 ° --b 0 --0 of hunt, invested in Securities Nc Pools Bank Depo itory Total o of fields Invested Operating Account Balance Average for Tune '011 2010 )s 64 96 35o 4 4640 3 65o 100.00o-o 100.00o-o 1693, 93,'23 2'036 Pooled Fund, Board Fund, Total ®Portfolio Yield ®Rendunarl<Yield* Get-,I F terp -e Intemzl Service Otho Fun& ®BudLet ®Actual R'AAl - Pooled Funds 6.00 -- 6.00 4.00 ry„ fit }S zif:, 3.00 r sst+ r r3;f;� a00 },f n 3M }f ��,'?i,`� 1.00 sf0 f« „fa 000 Apr -11 May -11 Jun -11 0 --0 of hunt, invested in Securities Nc Pools Bank Depo itory Total o of fields Invested Operating Account Balance Average for Tune '011 2010 )s 64 96 35o 4 4640 3 65o 100.00o-o 100.00o-o 1693, 93,'23 2'036 Pooled Fund, Board Fund, Total ®Portfolio Yield ®Rendunarl<Yield* Get-,I F terp -e Intemzl Service Otho Fun& ®BudLet ®Actual Portfolio Yield vs Benchmark Aug -11 Jun -11 Apr -11 Feb -11 Dec -10 Oct -10 0.00 0.10 0.20 0.30 0.40 0.50 0.60 Oct -10 Nov -10 Dec -10 Jan -11 Feb -11 Mar -11 Apr -11 Mav-11 Jun -11 Jul -11 Aug -11 Sep -11 oPortfolioYield 0.51 0=0 0.44 0=0 0.40 0=0 0.31 0=0 0.29 0=0 0.32 0=0 0.31 0=0 0.27 0=0 0.26 0=0 Benchmark L 0.18 0 =0 0.18 0 =0 0.19 0 =0 0.18 0 =0 0.17 0 =0 0.16 0 =0 0.12 0 =0 0.09 0 =0 0.10 0 =0 Additional Earnings (over 6 month Treasure Bill) 70.000 60.000 50.000 40.000 30.000 20.000 10.000 Oct -10 Nov -10 Dec -10 Jan -11 Feb -11 Mar -11 Apr -11 May -11 Jun -11 Jul -11 Aug -11 Sep -11 Ern _ 10.521 8.449 5.915 4.099 3.652 6.934 7.876 6.301 5.464 [11 jAdd m Ern_ 10.521 18.970 24.885 28.984 32.636 39.570 47.446 53.747 59.211 59.211 59.211 59.211 Investment Maturity & Cashflow (excluding Texpool, Te %STAR & Logic) 7.000.000 6.000.000 5.000.000 4.000.000 3.000.000 2.000.000 1.000.000 Jul -11 Sep -11 Nov -11 Jan -12 Mar -12 May -12 Jul -12 Sep -12 Nov -12 Jan -13 Mar -13 May -13 Jul -13 Sep -13 Market Gain (Loss) by Month 30,000 20,000 10,000 (10,000) (20,000) (30,000) (40,000) OCT No`' DEC JAN FEB LaR APR 1AY JUN JUL At ?G SEP AGENCIES 1,027 (17,280 (23, 11) (17,426) (27,372) (34,668) 1,054 17,715 17,739 Monthly Portfolio Division 6 °0 21°0 FA 52 °0 44 11: 11 1 , 140 Ameav Bank Wells Fargo Morgan Stanley Coastal Securities Average Return on Investments 0.90% 0.80% f fFh2frrr 0.70% y , ««««««« «««« ,� 0.60% t ✓r'� �ff�rr fr 0.50% 0.40% fJr .,lrrrlr7 } ) 0.30% 0.20% 0.1 % r ✓ %:� � ;"lf P +/ •r rf m Coastal Morgan Wells Ameg,�- Average Yields SymAWes W..Wjl�A. (YAWO (13pik June 30, 2011 This report is in full compliance with the investment strategy as established for the pooled investment fund and the Public Funds Investment Act (Chapter 2256 ). 4chael G. DolbV Shelley Wolny Director of Finan Treasurer