12. Treasurer's ReportADMINISTRATIVE? SERVICES DEPARTMENT
CUPERTINO
CITY HALL
10300 TORRE AVENUE • CUPERTINO, CA 95014 -3255
(408) 777 -3220 - FAX (408) 777 -3109
SUMMARY
Agenda Item No. / ;�
SUBJECT AND ISSUE
Meeting Date: May 4, 2010
Accept the Treasurer's Investment and Budget Report for March 2010.
BACKGROUND
Investments
The market and book value of the City's portfolio both totaled $51.6 million at March 31,
2010. The portfolio's March yield of 0.44% was up from 0.42% in the previous month but
down from 1.04% a year ago due to the decision to take the portfolio to a safe and liquid
mix of investments given the risk and volatility of the current market. The LAIF
benchmark was at 0.55% for March, down from 0.58% the previous month and 1.82% a
year ago, reflective of their move to a higher percentage of investments backed by the full
faith and credit of the federal government.
The City's portfolio decreased slightly from the previous month by $0.2 million due to the
usual monthly disbursements. Six million dollars in Treasuries matured this month, with
five million of it re- invested in a new one -year Treasury note and one million kept in liquid
funds.
Investments are in full compliance with the City investment policy and State law and are
tiered to provide sufficient cash flows to pay City obligations over the next six months.
General Fund Revenues and Expenditures
Fiscal year -to -date revenues through March trailed prior year levels by 13 %, but forecasts
show City revenues to end up 8% below last year's actual numbers. This decrease has
already been reflected in the current budget. Sales taxes, property taxes, and investment
earnings are particularly impacted from the recession, state borrowing, and low interest rate
environment, respectively, but transient occupancy taxes are recovering.
Operating expenditures through March are c111Tently at 3% over last year, well within the
current budget expectations. Biannual election costs, school safety improvements, legal
costs, and the re- opening of Blackberry Farm are offset by lower plan check and city
communication costs. In addition, the selective hiring freeze has contributed to keeping
expenditures below budget appropriations.
12 -1
Treasurer's Investment and Budget Report
May 4, 2010
Page 2 of 2
RECOMMENDATION
Accept the Treasurer's Investment and Budget Report for March 2010.
Submitted by:
David Woo
Deputy City Treasurer
Approved for submission:
David W. Knapp
City Manager
Reviewed by:
ood
City Treasurer
Attachment A: Investment Portfolio
Attachment B: General Fund Budget Report and Charts
GAF inance\Treasury\Monthly Reportslstaff report Mar 20I O.doc 12-2
City of Cupertino
Investment Portfolio
March 31, 2010
ATTACHMENT A
ACTIVITY DATE
COUPON
YIELD
ADJUSTED
MATURITY
MARKET
UNREALIZED
PURCHASE
M A70RITY
R-IPTION
— RATE ---
Fo Maturit�
--- U0ST —
VALUE
VALUE
SECURITIES MATURED
08/25/09
02/28/10
US Treasury Note
2.00%
0.18%
1,000,000
1,000,000
1,000,000
0
09/25/09
03/15/10
US Treasury Note
z
0.1 %
3,000,000
3,000,000
3,000,000
0
01/12/09
03/31/10
US Treasury Note
1.75%
0.36%
2,000,000
2,000,000
2,000,000
0
--------- --
SECURITIES PURCHASED
US Treasury Note
6:88
0-44%
5,021,579
5,000,000
5,020,900
(679)
'. 03/26/ . 10" -- -- ' - " - 03/31/1I
CITY PORTFOLIO
CASH
03/31/10
Wells Fargo - Workers Comp Checking
15,385
15,385
15,385
0
03 1 /10
Wells Fargo - Regular Checking
51,360
51,360
51,360
0
03 / /I —
Wells Fargo - Repurchase Agreements
0,10%
0.10%
1,242,478
1,242,478
1
0
1,309,223
1,309,223
1,309,223
0
LAIF
03/3
LAIr - State Pool
0.55%
0.55%
592,405
592,40
592,405
0
CERTIFICATES OF DEPOSIT
--------
12/29/05
12/28/10
.......... ... .......
Nad Bnk of New York City, Flushing Ni
-------------
4.90%
4.90%,
97,000
97,000
100,020
3,020
97,000
97,000
100,020
3,020
MONEY MARKET FUNDS
03/31/10
Wells Fargo 100% Treasury
0,01%
0.01%
8,913,670
8,913,670
8,913,670
0
8,913,670
8,913,670
8,913,670
0
AGENCY NOTES
06/25/08
05/07/10
FFCB
4.75%
3.38%
1,001,333
1,000,000
1,004,380
3,047
05/07/08
06111/10
FHLB
3.00%
2,98%
1,000,040
1,000,000
1,005,310
5,270
01/30/09
09/10/10
FHLB
:1.13%
1.33%
1,000,000
1,022,500
5,793
3,018,080
3,000,000
3,032,190
14,110
US TREASURY SECURITIES
— ----------
0 9
04/15/10
US Treasury Note
4.00%
0.60%
3,004,171
3,000,000
. 3,004,350
179
____ 03/30/
10/29/09
04/29/10
US Treasury Bill
0,15%
0.15%
3,999,533 .----4,000,000
3,999,520
(13)
12/07/09
05/20/10
US Treasury Bill
1).15%
0.15%
3,999,167
4,000,000
3,999,200
33
06/24/09
05/31/10
US Treasury Note
0.40%
1,003,703
1,000,000
1,004,020
317
06/29/09
05/31/10
US Treasury Note
— :1.63%
0.38%
1,003,737
1,000,000
1,004,020
-------,283
12/21/09
06/17/10
US Treasury Bill
— :1.63%
113%
0.13%
3,998,873
4,000,000
3,998,760
(113)
04/30/09
06/30/10
US Treasury Note
2-88%
0.50%
2,514,769
2,500,000
2,516,700
1,931
05/14/09
07/31/10
US Treasury Note
2,75%
0.50%
3,022,462
3,000,000
3,025,560
3,098
05/21/09
08/31/10
US Treasury Note
2.38%
0.50%
3,023,451
3,000,000
3,026,610
3,159
05/29/09
09/30/10
US Treasury Note
2.00%
0.62%
2,013,710
2,000,000
2,017,2,60
3,550
01/29/10
12/31/10
US Treasury Note —
).88%
0.25%
2,511,829
2,500,000
2,509,775
(2,054)
01/29/10
01131/11
US Treasury Note
).88%
0.28%
2,512,377
2,500,000
2,510,150
(2,227)
03/26/10
03/31/11
US Treasury Note
).88%
0.44%
5,021,579
5,000,000
5,020,900
(679)
37,629,361
37,500,000
37,636,825
7,464
Tot Manag Portfoli
51.559.739
1 51,412,298
1 51.584333
Yield
+
0.44%1
---
T Average
jAverage Length to Maturity
(in years)
0.311
1
12-3
City of Cupertino
Investment Portfolio
March 31, 2010
ATTACHMENT A
ACTIVITY DATE
COUPON
YIELD
ADJUSTED
MATURITY
MARKET
UNREALIZED
PURCHASE
MATURITY
D CRHMON RATE —
fo — M—atarit , ' -- ' - = —
VALUE
VALUE
FRar-frXOST
TRUST PORTFOLIO {ICES 'TER TRUST)
CASH
03/31/10
Wells Institutional Money Mkt Acct
0.15%
0.15%
48,350
48,350
48,350
0
Total Trust Portfolio
48,350
49,3501
48,350
1 0
BOND RUSERVE PORTFOLIO
Bond Reserve Acct
Ambac Assurance Security Bond
1
1
1
ITotal Bond Reserve Portfolio
0
1 0
1 0
1 0
12-4
1.80%
1.60%
1.40%
1.20%
1.00%
0.80%
0.60%
0.40%
0.20%
0.00%
Rate of Return Comparison
—0 LAiF
—0-- Cupertino
12 -5
COMPLIANCE WITH INVESTMENT POLICY
City of Cupertino
March 31, 2010
Category Standard Comment
Treasury Issues
US Agencies
Medium Term Corporate Bonds
LAIF
Money Market Funds
Maximum Maturities
Per Issuer Max
Bankers Acceptances
Commercial Paper
Negotiable Certificates of Deposit
Repurchase Agreements
Reverse Repurchase agreements
No limit
Complies
No limit
Complies
30% with A rating
Complies
$50 million
Complies
20%
Complies
Up to 5 years
Complies
10% (except for Treasuries and US Agencies)
Complies
180 days & 40%
Complies
270 days & 25%
Complies
30%
Complies
365 days
Complies
Prohibited
Complies
12 -6
ATTACHMENT B
City of Cupertino
General Fund Budget Report
March 31, 2010
Budget
Actual
2008/09
2009/10
3/31/2009
3/31/2010
Analysis of Trends
Taxes:
Sales Tax
13,390,000
11,249,000
10,514,548
7,652,901
State true-up of last year's declines as expected.
Property Tax
t 11,080,000
10,419,503
6,931,811
6,336,971
State borrowing
Transient Occupancy
2,660,000
1,994,000
1,592,069
1,484,061
Improved since November
Utility Tax
3,300,000
3,366,000
1,961,453
2,040,931
On track
Franchise Fees
2,630,000
2,630,000
1,070,148
1,072,374
On track
Other Taxes
1,500,000
1,200,000
775,527
810,267
On track
Licenses and Permits
! 2,980,000
3,210,000
1,894,867
2,052,516
Rose Bowl development
Use of Money & Property
; 1,267,000
891,000
947,967
494,964
Investment earnings reflective of market
Intergovernmental
493,892
415,000
276,469
342,172
1 Federal stimulus
Charges for Services
1,468,000
1,434,0001
1,068,701
1,026,956
Plan check fees down
Fines & Forfeitures
u2u,uuu
yu2,uu0
46y,5u5
472,769
Other Revenue
100,000
100,000
52,650
56,951
Total Revenue
7
j
23 4 8
Operating Expenditures:
Administrative
1,483,395
1 1,517,0041
936,736
1,010,679
On track
Law Enforcement
8,480,671
8,565,636;
6,174,216
6,328,907
On track; increase due to safety around schools
Public & Environ. Affairs
1,512,796
1,504,522
1,020,543
988,027
On track
Administrative Service
4,254,006
3,985,345
2,747,408
2,802,285
On track; increase due to election costs
Recreation Service
4,397,466
4,289,549
2,529,425
2,806,519
On track; increase due to BBF re- opening.
Community Development
4,207,7241
3,560,750
2,263,0971
2,114,069
Plan check savings
Public Works
11,652,0621
11,833,700
7,475,1591
7,693,051
!On track
Total Expenditures
1 2QJ
35
4 4
i 23,745.5
I S
�
Transfers In
623,9251
742,037]
252,470
742,037
Project savings; loan from equip fund because of state borrowing.
Transfers Out
j - 7,110,000
- 7,649,040;
- 5,324,940
- 5,755,787
Debt service, capital, and retiree medical costs funded out of excess
j
General Fund reserves.
Net Gain/ (Loss)
j - 785.303
-4-35 0
-
-4 9 4
Sales Tax Projections vs. Actual
$10,000
C
$8,000
0
r
$6,000
0
$4,000
d
$2,000
$0
$7,000
N
$6,000
N
7
r $5,000
$4,000
a
$3,000
$2,000
$1,000
$0
— +-- - Projected, per current budget
--m-- Actual
10109 11/09 12/09 1/10
Month
2/10 3/10
Property Tax Projections vs. Actual
— ♦— - Projected, per current budget
---0 Actual
10/09 11/09 12/09 1/10 2/10
Month
3/10
12 -8
Transient Occupancy Tax Projected vs. Actual
0 1,600
V
C
=1,200
o
d �
R
° 800
0
F-
r 400
0
r +- -.
1
— - Projected, per current budget
--�- -- Actual
10109 11/09 12109 1/10 2/10 3/10
Month
Licenses & Permits Projected vs. Actual
3,000
a
c
m
W
d 0 2,000
0
m
1,000
— - Projected, per current budget
--f— Actual
0
10109 11109 12/09 1110 2110 3110
Month
8
12 -9
0 1,500
�o
N
3
r
0 1,000
0
0
><
0 500
m
0
Charges for Services Projected vs. Actual
'I"' ♦110
— �— - Projected, per current budget
-^f— Actual 1
10/09 11109 12/09 1/10 2/10 3/10
Month
N 1,000
m
N
d, '
6 500
m
0
Use of Money & Property Projected vs. Actual
��� r te♦
0-- - Projected, per current budget
--f— Actual
10/09 11109 12109 1110 2/10 3/10
Month
12-10
General Fund Expenditures Projected vs. Actual
30,000
v
C
25,000
ro
20,000
O
15,000
10,000
5,000
0
10/09 11/09 12/09 1/10 2/10 3/10
Month
— �- - Projected, per current budget
— f--- Actual
12-11