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Home My WebLink About07-24-06 Regular Meeting of Fiscal Affairs Committee Minutes MINUTES OF THE LA PORTE FISCAL AFFAIRS COMMITTEE July 24, 2006 1. Call to Order The meeting was called to order by Councilman Chuck Engelken at 5:33 p.m. Members of Committee Present: Councilmembers Barry Beasley, Tommy Moser, Louis Rigby, Howard Ebow, and Chuck Engelken. Members of Committee Absent: Deborah Johnson. Members of City Executive Staff/Controller and City Employees Present: City Manager Debra Feazelle, Assistant City Manager Cynthia Pearson, Assistant Finance Director Michael Dolby, City Secretary Martha Gillett, Planning Director Wayne Sabo, Assistant City Manager John Joerns, Summer Youth Worker Erica Mochman, Assistant City Secretary Sharon Harris and Human Resources Manager Robert Swanagan. Other citizens: Spero Pomonis and Paul Chavez. 2. Consider approval of Minutes of Regular Meeting of La Porte Fiscal Affairs Committee Minutes held on April 24, 2006. Motion was made by Committee Member Beasley to approve the minutes as presented. A second by Committee Member Ebow. The motion carried. Ayes: Beasley, Engelken, Moser, Rigby and Ebow Nays: None Abstain: None 3. Assistant Finance Director Michael Dolby presented quartley investment reports for review. Staff will change report to provide the various senarios. Committee Member Rigby asked what if scenarios on different investments. 4. Assistant City Manager Cynthia Pearson requested committee members to consider an alternate investment Broker. Staff proposed to add Wells Fargo Broker. Staff will send package to Fiscal Affair committee and this item will be placed on next agenda for approval. Minutes of the La Porte Audit Committee July 24, 2006 - Page 2 5. Assistant Finance Director Michael Dolby presented the credit card expenditure report. Committee member Beasley had question on charges. Would like list to be more inclusive indication who, what, where and when and wants a letter of explanation of changes. Committee member Rigby questioned difference in conference registration. 6. Administrative Reports. There were no administrative reports. 7. Committee Comments There were no committee comments. 8. Adjournment There being no further business to come before the Committee, the meeting was adjourned at 5: 50 p.m. Respectfully submitted, 1'..1f1 (lJJJUt ~ J1I/ Martha A. Gillett, ~~C, CMC City Secretary Approved this 23rd day of October, 2006. Chairperson Chuck Engelken ~Q~ CITY OF LA PORTE Interoffice Memorandum TO: Barry Beasley, Councilman Howard Ebow, Councilman Chuck Engelken, Councilman Tommy Moser, Councilman Louis Rigby, Councilman John Joerns, Interim City Manager Michael Dolby, Interim Finance Director Phyllis Rinehart, Controller FROM: DATE: SUBJECT: October 13,2006 Quarterly Investment Report For the fourth quarter of the 2006 fiscal year, the City's investment portfolio yield has been between 4.64% and 4.93%. The average return on the portfolio for the fourth quarter of the fiscal year was 4.76%, which is still below the average yield of our benchmark, which was 5.19% (see graph below). Our benchmark is the 6- month T-Bill rate. The current year to date interest earned for the 2006 fiscal year is $1,788,815, which is approximately $1 M more than projected at this time. City vs. Benchmark 6.00% 5.00010 - ~ 4.00% - ~-- ~ - 3.00% 2.00% 1.00% \:l" ~" -..: 4,' OV ..;:;.0 ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ <!,r./ \"IJ.~ ~~' ~~ ~<: ~~ \~~ \~ ~~% '?"'~ - Portfolio Yield - Benchmark At September 30th the City's portfolio consisted of 47% in Agency Notes, 24% in Texpool, 22% In TexSTAR and 7% in Logic (see pie chart below). By Investment Type 47% 24% 7% I- Texpool - TexSTAR 0 Logic 0 Agency Note~ The overnight rate set by the Fed continues to remain stable. The most current overnight rate was set on June 29th at 5.25%. With that said, our main focus is to continue to ladder the portfolio. At the end of the fourth quarter, the City's portfolio consisted of 52% of the portfolio maturing overnight (see graph below). 35% of the City's portfolio matures in one year and 13% of the City's portfolio matures in 12-24 months. By Investment Maturity 13% 35%. .52% I · Overnight . 1-12 Months 012-24 Months I Currently, the 3-month T-Bill is at 5.02%; 2-year, at 4.77%; 5-year, at 4.68%; and, the 20-year is at 4.95% (see yield curve below). Yield Curve 5.50% 4.50% 3.50% 2.50% 1.50% 0.50% , 0 5 10 15 20 - 3 months ago - current The overnight rate is currently at 5.25%. We will continue to focus on laddering the portfolio to maintain a constant cash flow and a liquid position. 2 12.00% 10.00% 8.00% 6.00% 4.00% 2.00% 0.00% 2 YearT-Note ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ S~~ S~~ S~~ S~~ S~~ S~~ S~~ S~~ S~~ S~~ S~~ In summary, we will continue to invest the City's funds in conservative investments, as authorized by the Public Funds Investment Act, always keeping in mind Safety first, and then Liquidity and lastly Yield. 3 Par Book Market Days to Value Value Value Maturity Investment Pools 16,323,118 16,323,118 16,323,118 1 Agencies 15,012,943 15,012,943 14,962,890 298 Total 31,336,061 31,336,061 31,286,008 143 Book Value Percent 1-12 months 16,323,118 52.09% 9-12 months 11,003,010 35.11% 1-2 years 4,009,933 12.80% Total 31,336,061 100.00% Pooled Funds Bond Funds Portfolio Yield 4.93% 5.26% Benchmark Yield' 5.10% 5.02% Total 5.10% Portfolio Composition and Value as of September 30,2006 80.00% 60.00% 40.00% 20.00% 0.00% Investment Pools 52,09% ~f~c~s _ Sep-06 _ Mar-06 -.... Sep-05 Investment Maturity Schedule as of September 30,2006 1-2 years 2 or more years Portfolio Perform ante for the month of September 2006 Weighted Average Maturity 4.52 months I day 5.06% 3.15 months 'The pooled funds benchmark is based on the average monthly yield of a 6-month Treaswy. The bond funds benchmark yield is based on the average monthly yield of a 3-month Treaswy. The total is based on weighted average monthly benchmark yields. Pooled Funds Bond Funds Total I [J Portfolio Yield . Benchmark Yield' I Portfolio Earnings for months ended September 30,2006 500,000 Budget Actual Percent 400,000 General 329,370 489,093 148.49% Enterprise 54,690 74,708 136.60% 300,000 Internal Service 88,060 118,504 134.57% 200,000 Total 472,120 682,305 144.52% 100,000 Yield Curve ~~~ 200% 100% ~ 000% 3mo 6mo . ~ _t1 1yr 2yr 5yr I-+-Jul-OS Aug-oe -- Sep-OS I General Entaprise . Budget Intmlal Service . Actual WAM . Pooled Funds 0.00 9.00 8.00 7.00 a.oo 5.00 4.00 3.00 2.00 1.00 0.00 Average for September 2006 2005 91,44% 96.21% 8.56% 3.79% 100.00% 100.00% .~ % of funds invested in: Securities & Pools Bank Depository Total % of funds invested Operating Account Balance 2,934,600 1,324,784 Jul-Oa Aug-oa Sap-oa September 30, 2006 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). Michael Dolby Finance Director ')CX~d 4 Fiscal Affairs Agenda Item 4 Consider approval and removal of investment broker. At last meeting this item was directed to be placed on the next agenda. Recommended Action: Approve Wells Fargo to be added to approved list of broker dealers. Remove 1 st Southwest from the approved list of broker dealers. Exhibit B BROKERlDEALER CERTIFICATION FORM As required by Texas Government Code 2256.005 (k-I) CITY OF LA PORTE, TEXAS This certification is executed on behalf of The City of La Porte, TX (the Investor) and Wells Fargo Brokerage ServicesftC(the Dealer) pursuant to the Public Funds Investment Act, Chapter 2256, Government Code, Texas Codes Annotated (the Act) in connection with investment transactions conducted between the Investor and Dealer. The Undersigned Qualified Representative of the Dealer hereby certifies on behalf of the Dealer that: 1. The Dealer Qualified Representative IS duly authorized to execute this Certification on behalf of the Dealer, and 2. The Dealer Qualified Representative has received and reviewed the Investment Policy furnished by the Investor, and 3. The Dealer has implemented reasonable procedures and controls in an effort to preclude investment transactions conducted between the Dealer and the Investor that are not authorized by the entity's investment policy, except to the extent that this authorization is dependent on an analysis of the makeup of the entity's entire portfolio or requires an interpretation of subjective investment standards. Dealer Qualified Representative ~t Teresa M. YRn~ey Name (Printed): Regional Sales Manager Title: July 14, 2006 Date: Exhibit B BROKER/DEALER CERTIFICATION FORM As required by Texas Government Code 2256.005 (k-I) CITY OF LA PORTE, TEXAS This certification is executed on behalf of The City of La Porte, TX (the Investor) and Wells Fargo Brokerage ServicesftC(the Dealer) pursuant to the Public Funds Investment Act, Chapter 2256, Government Code, Texas Codes Annotated (the Act) in connection with investment transactions conducted between the Investor and Dealer. The Undersigned Qualified Representative of the Dealer hereby certifies on behalf of the Dealer that 1. The Dealer Qualified Representative IS duly authorized to execute this Certification on behalf of the Dealer, and 2. The Dealer Qualified Representative has received and reviewed the Investment Policy furnished by the Investor, and 3. The Dealer has implemented reasonable procedures and controls in an effort to preclude investment transactions conducted between the Dealer and the Investor that are not authorized by the entity's investment policy, except to the extent that this authorization is dependent on an analysis of the makeup of the entity's entire portfolio or requires an interpretation of subjective investment standards. Dealer Qualified Representative ~t Teresa M. YRn~ey Name (printed): Regional Sales Manager Title: July 14, 2006 Date: Exhibit B BROKERJDEALER CERTIFICATION FORM As required by Texas Government Code 2256.005 (k-I) CITY OF LA PORTE, TEXAS This certification is executed on behalf of The Ci ty of La Porte, TX (the Investor) and Wells Fargo Brokerage Servicesftf.(the Dealer) pursuant to the Public Funds Investment Act, Chapter 2256, Government Code, Texas Codes Annotated (the Act) in connection with investment transactions conducted between the Investor and Dealer. The Undersigned Qualified Representative of the Dealer hereby certifies on behalf of the Dealer that: 1. The Dealer Qualified Representative IS duly authorized to execute this Certification on behalf of the Dealer, and 2. The Dealer Qualified Representative has received and reviewed the Investment Policy furnished by the Investor, and 3. The Dealer has implemented reasonable procedures and controls in an effort to preclude investment transactions conducted between the Dealer and the Investor that are not authorized by the entity's investment policy, except to the extent that this authorization is dependent on an analysis of the makeup of the entity's entire portfolio or requires an interpretation of subjective investment standards. Dealer Qualified Representative ~flr Signature !J Teresa M. Yan~ey Name (Printed): Regional Sales Manager Title: July 14, 2006 Date: Exhibit B BROKERlDEALER CERTIFICATION FORM As required by Texas Government Code 2256.005 (k-I) CITY OF LA PORTE, TEXAS This certification is executed on behalf of The City of La Porte, TX (the Investor) and Wells Fargo Brokerage ServicesftC.{the Dealer) pursuant to the Public Funds Investment Act, Chapter 2256, Government Code, Texas Codes Annotated (the Act) in connection with investment transactions conducted between the Investor and Dealer. The Undersigned Qualified Representative of the Dealer hereby certifies on behalf of the Dealer that: 1. The Dealer Qualified Representative IS duly authorized to execute this Certification on behalf of the Dealer, and 2. The Dealer Qualified Representative has received and reviewed the Investment Policy furnished by the Investor, and 3. The Dealer has implemented reasonable procedures and controls in an effort to preclude investment transactions conducted between the Dealer and the Investor that are not authorized by the entity's investment policy, except to the extent that this authorization is dependent on an analysis of the makeup of the entity's entire portfolio or requires an interpretation of subjective investment standards. Dealer Qualified Representative ~o Signature !J Teresa M. YAnrRY Name (Printed): Regional Sales Manager Title: July 14, 2006 Date: Exhibit B BROKERlDEALER CERTIFICATION FORM As required by Texas Government Code 2256.005 (k-I) CITY OF LA PORTE, TEXAS This certification is executed on behalf of The City of La Porte, TX (the Investor) and Wells Fargo Brokerage Servicesf'C.{the Dealer) pursuant to the Public Funds Investment Act, Chapter 2256, Government Code, Texas Codes Annotated (the Act) in connection with investment transactions conducted between the Investor and Dealer. The Undersigned Qualified Representative of the Dealer hereby certifies on behalf of the Dealer that: 1. The Dealer Qualified Representative IS duly authorized to execute this Certification on behalf of the Dealer, and 2. The Dealer Qualified Representative has received and reviewed the Investment Policy furnished by the Investor, and 3. The Dealer has implemented reasonable procedures and controls in an effort to preclude investment transactions conducted between the Dealer and the Investor that are not authorized by the entity's investment policy, except to the extent that this authorization is dependent on an analysis of the makeup of the entity's entire portfolio or requires an interpretation of subjective investment standards. Dealer Qualified Representative ~flr Teresa M. YRnrpy Name (Printed): Regional Sales Manager Title: July 14, 2006 Date: Exhibit B BROKERlDEALER CERTIFICATION FORM As required by Texas Government Code 2256.005 (k-I) CITY OF LA PORTE, TEXAS This certification is executed on behalf of The City of La Porte, TX (the Investor) and Wells Fargo Brokerage ServicesftC(the Dealer) pursuant to the Public Funds Investment Act, Chapter 2256, Government Code, Texas Codes Annotated (the Act) in connection with investment transactions conducted between the Investor and Dealer. The Undersigned Qualified Representative of the Dealer hereby certifies on behalf of the Dealer that: 1. The Dealer Qualified Representative IS duly authorized to execute this Certification on behalf of the Dealer, and 2. The Dealer Qualified Representative has received and reviewed the Investment Policy furnished by the Investor, and 3. The Dealer has implemented reasonable procedures and controls in an effort to preclude investment transactions conducted between the Dealer and the Investor that are not authorized by the entity's investment policy, except to the extent that this authorization is dependent on an analysis of the makeup of the entity's entire portfolio or requires an interpretation of subjective investment standards. Dealer Qualified Representative ~flt Signature !J Teresa M. YRn~p.y Name (Printed): Regional Sales Manager Title: July 14, 2006 Date: Exhibit B BROKERlDEALER CERTIFICATION FORM As required by Texas Government Code 2256.005 (k-I) CITY OF LA PORTE, TEXAS This certification is executed on behalf of The City of La Porte, TX (the Investor) and Wells Fargo Brokerage Servicespc(the Dealer) pursuant to the Public Funds Investment Act, Chapter 2256, Government Code, Texas Codes Annotated (the Act) in connection with investment transactions conducted between the Investor and Dealer. The Undersigned Qualified Representative of the Dealer hereby certifies on behalf of the Dealer that: 1. The Dealer Qualified Representative IS duly authorized to execute this Certification on behalf of the Dealer, and 2. The Dealer Qualified Representative has received and reviewed the Investment Policy furnished by the Investor, and 3. The Dealer has implemented reasonable procedures and controls in an effort to preclude investment transactions conducted between the Dealer and the Investor that are not authorized by the entity's investment policy, except to the extent that this authorization is dependent on an analysis of the makeup of the entity's entire portfolio or requires an interpretation of subjective investment standards. Dealer Qualified Representative ~J2t Teresa M. YAnr~y Name (Printed): Regional Sales Manager Title: July 14, 2006 Date: Exhibit B BROKER/DEALER CERTIFICATION FORM As required by Texas Government Code 2256.005 (k-I) CITY OF LA PORTE, TEXAS This certification is executed on behalf of The City of La Porte, TX (the Investor) and Wells Fargo Brokerage ServicesftCthe Dealer) pursuant to the Public Funds Investment Act, Chapter 2256, Government Code, Texas Codes Annotated (the Act) in connection with investment transactions conducted between the Investor and Dealer. The Undersigned Qualified Representative of the Dealer hereby certifies on behalf of the Dealer that: 1. The Dealer Qualified Representative IS duly authorized to execute this Certification on behalf of the Dealer, and 2. The Dealer Qualified Representative has received and reviewed the Investment Policy furnished by the Investor, and 3. The Dealer has implemented reasonable procedures and controls in an effort to preclude investment transactions conducted between the Dealer and the Investor that are not authorized by the entity's investment policy, except to the extent that this authorization is dependent on an analysis of the makeup of the entity's entire portfolio or requires an interpretation of subjective investment standards. Dealer Qualified Representative ~flO Signature ~. Teresa M. Yan~~y Name (printed): Regional Sales Manager Title: July 14, 2006 Date: City of La Porte, Texas Quarterly Report of Credit Card Expenditures Fourth Quarter FY 2006 Report of Credit Card Expenditures Quarter Ending September 30, 2006 Check Payee Date Number Amount Cardholder Name/Position Amount Debra Feazelle, City Manager 142.46 Elan Financial Services 07/28/06 227451 337.46 John Joerns, Assistant City Manager 445.00 Elan Financial Services 09/01/06 228142 369.10 Cynthia Alexander, Assistant City Manager 369.10 Elan Financial Services 10/06/06 228704 250.00 Martha Gillett, City Secretary 0.00 Richard Reff, Police Chief 0.00 Total Expenditures $ 956.56 $ 956.56 NOTE: This report reflects all PA YMENTS made during the Fourth Quarter of FY 2006 (Ju/y, August, September 2006) City of La Porte, Texas Quarterly Report of Credit Card Expenditures Fourth Quarter FY 2006 Cardholder Position: City Manager Payee Date Amount Expense Type Purpose Republic Grill @ Battleground 06/26/06 47.46 Breakfast Meeting to discuss Barbours Cut Blvd June 26,2006 D. Feazelle, Commissioner Phelps, R. Reff, J. Tippit, Kyle Jones, T. Moser, M. Mosteit, J. Burke La Porte, TX Monument Inn 07/12/06 95.00 Luncheon CDBG Housing Grant, Packwell Tax Abatement July 12, 2006 D. Feazelle, W. Saba, J. Joerns, David Turkel, Nancy Powell, Jeanne Spivey Deer Park, TX Total Quarterly Charges $ 142.46 Check # 227451 NOTE: This report reflects all PA YMENTS made during the Fourth Quarter of FY 2006 (July, August, September 2006) City of La Porte, Texas Quarterly Report of Credit Card Expenditures Fourth Quarter FY 2006 Cardholder Position: Assistant City Manager, John Joerns Payee Date Amount ICSC 07/11/06 195.00 Texas Municipal League 09/12/06 250.00 Total Quarterly Charges $ 445.00 Expense Type Purpose Registration International Council of Shopping Centers (ICSC) Texas Conference and Deal Making October 10-12, 2006 John Joerns - San Antonio, TX Registration TML Annual Conference 94th Annual Conference & Exhibition August 12,2006 John Joerns - Austin, TX Check # 227451 228714 NOTE: This report reflects all PA YMENTS made during the Fourth Quarter of FY 2006 (July, August, September 2006) City of La Porte, Texas Quarterly Report of Credit Card Expenditures Fourth Quarter FY 2006 Cardholder Position: Assistant City Manager, Cynthia Alexander Payee Date Amount Expense Type Purpose Southwest Airlines 07/25/06 184.10 Airfare TML Board Meeting August 11, 2006 Cynthia Alexander - Austin, TX Natl Forum Black Public 07/28/06 185.00 Membership - Renewal Natl Forum for Black Public Administrators September 2006 - September 2007 Cynthia Alexander Check # 228142 Total Quarterly Charges $ 369.10 NOTE: This report reflects all PA YMENTS made during the Fourth Quarter of FY 2006 (July, August, September 2006) September 30,2006 This report is in full compliance with the credit card policy as established by the City of La Porte's Audit Committee. 6 (/:XuU JO/t'J/o(,