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CC 2016-10-25_09b Statement of Investment Deposits MEMORANDUM TO: CITY COUNCIL FROM: DEBBIE MALICOAT, DIRECTOR OF ADMINISTRATIVE SERVICES SUBJECT: CONSIDERATION OF STATEMENT OF INVESTMENT DEPOSITS DATE: OCTOBER 25, 2016 RECOMMENDATION: It is recommended the City Council receive and file the attached report listing of investment deposits of the City of Arroyo Grande, as of August 31, 2016 and September 30, 2016, as required by Government Code Section 53646(b). IMPACT ON FINANCIAL AND PERSONNEL RESOURCES: There is no funding impact to the City related to these reports. However, the City does receive interest revenue based on the interest rate of the investments. No or minimal future staff time is projected. BACKGROUND: This report represents the City’s investments as of August 31, 2016 and September 30, 2016. It includes all investments managed by the City, the investment institution, investment type, book value, maturity date, and rate of interest. As of September 30, 2016, the investment portfolio was in compliance with all State laws and the City’s investment policy. ANALYSIS OF ISSUES: The Director of Administrative Services has historically submitted to the City Council a monthly report, providing the following information: 1. Type of investment. 2. Financial institution (bank, savings and loan, broker, etc). 3. Date of maturity. 4. Principal amount. 5. Rate of interest. 6. Current market value for all securities having a maturity of more than 12 months. 7. Relationship of the monthly report to the annual statement of investment policy. Item 9.b. - Page 1 CITY COUNCIL CONSIDERATION OF INVESTMENT DEPOSITS OCTOBER 25, 2016 PAGE 2 ALTERNATIVES: The following alternatives are provided for the Council’s consideration: - Recommended Alternative - Approve staff’s recommendation to receive and file the attached report listing the investment deposits. - Do not approve staff’s recommendation - Provide direction to staff ADVANTAGES: Safety of principal is the foremost objective of the City. Investments are undertaken in a manner that seeks to ensure the preservation of capital in the overall portfolio. DISADVANTAGES: Some level of risk is present in any investment transaction. Losses could be incurred due to market price changes, technical cash flow complications such as the need to withdraw a non- negotiable Time Certificate of Deposit early, or even the default of an issuer. To minimize such risks, diversifications of the investment portfolio by institution and by investment instruments are being used as much as is practical and prudent. ENVIRONMENTAL REVIEW: No environmental review is required for this item. PUBLIC NOTIFICATION AND COMMENTS: The Agenda was posted at City Hall and on the City’s website in accordance with Government Code Section 54954.2. Attachments: 1. Portfolio Summary: August 31, 2016 2. Portfolio Summary: September 30, 2016 Item 9.b. - Page 2 ATTACHMENT 1 City of Arroyo Grande 300 E. Branch St. Arroyo Grande, CA 93420 Phone: (805) 473-5400 CITY OF ARROYO GRANDE Portfolio Management Portfolio Summary August 31, 2016 Investments Principal Value Current Market Value Interest Rate Date of Purchase Term Maturity Date % of Portfolio Local Agency Investment Fund 6,153,547.37$ 6,153,547.37$ 0.614%33.125% Certificates of Deposit Heritage Oaks Bank 100,996.91 100,996.91 0.500%December 21, 2015 12 mos December 21, 2016 0.544% Redding Bank of Commerce 250,000.00 250,000.00 1.300%March 22, 2015 36 mos March 22, 2018 1.346% Compass Bank 245,000.00 245,000.00 1.150%May 6, 2015 36 mos May 7, 2018 1.319% Silvergate Bank 249,000.00 249,000.00 1.050%June 17, 2016 36 mos June 18, 2018 1.340% Mission Community Bank 1,000,000.00 1,000,000.00 0.800%July 3, 2015 36 mos July 3, 2018 5.383% BMW Bank 245,000.00 245,000.00 2.000%August 30, 2013 60 mos August 30, 2018 1.319% Ally Bank 248,000.00 248,000.00 1.050%July 7, 2016 36 mos July 8, 2019 1.335% Capital One Bank USA 248,000.00 248,000.00 1.000%July 7, 2016 36 mos July 8, 2019 1.335% Discover Bank 248,000.00 248,000.00 1.100%July 7, 2016 36 mos July 8, 2019 1.335% JP Morgan Chase Bank 248,000.00 248,000.00 1.100%July 15, 2016 36 mos July 15, 2019 1.335% Total Certificates of Deposit 3,081,996.91 3,081,996.91 11.251% Agency Bonds FICO Strip Principal 2,496,606.72 2,528,468.48 0.840%January 15, 2015 360 mos November 30, 2017 13.439% Federal National Mortgage Assn 2,423,035.90 2,455,486.09 1.060%September 17, 2014 66 mos April 30, 2018 13.043% Federal National Mortgage Assn 1,965,062.00 1,993,808.00 1.250%February 14, 2014 60 mos January 30, 2019 10.578% FICO Strip Coupon 954,201.94 983,792.15 1.480%May 6, 2015 360 mos September 26, 2019 5.137% Federal Home Loan Bank 1,502,338.50 1,486,041.00 1.200%July 13, 2016 48 mos July 13, 2020 8.087% Total Agency Bonds 9,341,245.06 9,447,595.72 50.284% TOTAL INVESTMENTS 18,576,789.34$ 18,683,140.00$ 100.000% * Effective Interest Rate Item 9.b. - Page 3 ATTACHMENT 2 City of Arroyo Grande 300 E. Branch St. Arroyo Grande, CA 93420 Phone: (805) 473-5400 CITY OF ARROYO GRANDE Portfolio Management Portfolio Summary September 30, 2016 Investments Principal Value Current Market Value Interest Rate Date of Purchase Term Maturity Date % of Portfolio Local Agency Investment Fund 6,153,547.37$ 6,153,547.37$ 0.634%33.125% Certificates of Deposit Heritage Oaks Bank 100,996.91 100,996.91 0.500%December 21, 2015 12 mos December 21, 2016 0.544% Redding Bank of Commerce 250,000.00 250,000.00 1.300%March 22, 2015 36 mos March 22, 2018 1.346% Compass Bank 245,000.00 245,000.00 1.150%May 6, 2015 36 mos May 7, 2018 1.319% Silvergate Bank 249,000.00 249,000.00 1.050%June 17, 2016 36 mos June 18, 2018 1.340% Mission Community Bank 1,000,000.00 1,000,000.00 0.800%July 3, 2015 36 mos July 3, 2018 5.383% BMW Bank 245,000.00 245,000.00 2.000%August 30, 2013 60 mos August 30, 2018 1.319% Ally Bank 248,000.00 248,000.00 1.050%July 7, 2016 36 mos July 8, 2019 1.335% Capital One Bank USA 248,000.00 248,000.00 1.000%July 7, 2016 36 mos July 8, 2019 1.335% Discover Bank 248,000.00 248,000.00 1.100%July 7, 2016 36 mos July 8, 2019 1.335% JP Morgan Chase Bank 248,000.00 248,000.00 1.100%July 15, 2016 36 mos July 15, 2019 1.335% Total Certificates of Deposit 3,081,996.91 3,081,996.91 11.251% Agency Bonds FICO Strip Principal 2,496,606.72 2,532,454.40 0.840%January 15, 2015 360 mos November 30, 2017 13.439% Federal National Mortgage Assn 2,423,035.90 2,455,044.19 1.060%September 17, 2014 66 mos April 30, 2018 13.043% Federal National Mortgage Assn 1,965,062.00 1,997,700.00 1.250%February 14, 2014 60 mos January 30, 2019 10.578% FICO Strip Coupon 954,201.94 987,236.04 1.480%May 6, 2015 360 mos September 26, 2019 5.137% Federal Home Loan Bank 1,502,338.50 1,491,762.00 1.200%July 13, 2016 48 mos July 13, 2020 8.087% Total Agency Bonds 9,341,245.06 9,464,196.63 50.284% TOTAL INVESTMENTS 18,576,789.34$ 18,699,740.91$ 100.000% * Effective Interest Rate Item 9.b. - Page 4