Loading...
HomeMy WebLinkAbout05/21/2013 05C 2013 1st Quarter Treasury Report1 BUSINESS OF THE CITY COUNCIL YAKIMA, WASHINGTON AGENDA STATEMENT Item No.,",)(-,-,, For Meeting of: 5/21/2013 ITEM TITLE: 2013 - 1 st Quarter Treasury Report. SUBMITTED BY: Cindy Epperson, Director of Finance and Budget Tara Lewis, Financial Services Manager SUMMARY EXPLANATION: The Treasury Report for the first quarter of 2013 is attached and consists of the following: 1. Memo: Summary and Narrative 2. Reports Cash and Investment Summary Investment Portfolio - Detailed Inventory by Agency Investment Portfolio - Detail of Activity Bonded Debt Schedule Schedule of Interfund Borrowings and Investments Resolution: Other (Specify): Report Contract: Start Date: Item Budgeted: Funding Source /Fiscal Impact: Strategic Priority: Insurance Required? No Mail to: Phone: APPROVED FOR SUBMITTAL: Ordinance: Contract Term: End Date: Amount: City Manager 4:=IjftT &O.J, Description 2013 Ql Treasury Narrative 2013 Ql Treasury Reports Memorandum To: The Honorable Mayor and Members of City Council From: Cindy Epperson, Director of Finance and Budget Tara Lewis, Financial Services Manager Date: May 21, 2013 Re: 2013 — 1 st Quarter Treasury Report: Summary and Narrative The City's Investment Portfolio The City's investment activities are governed by State regulations and the City of Yakima's Investment Policy, as revised 9/06/11. The City's Investment Portfolio can be divided into two general categories: 1) A Liquidity Portfolio of overnight investments. This category generally consists only of funds invested in the Local Government Investment Pool (LGIP) managed by the State Treasurer. 2) An Investment Portfolio of time deposits and various securities with maturities normally not to exceed five years except when conditions warrant, and then up to eight years. The effective yield on the City's entire Investment Portfolio for the quarter ending 3/31/13 has dipped slightly as predicted from 1.17% to 1.15 %. New investments are available only at dismal rates of return and so the effective yield will likely continue to fall as it approaches market rates. Very little change is expected in the coming year. The LGIP yield has continued to slide slowly toward zero as can be expected. The LGIP is essentially an overnight pool so one cannot expect much in this market. It yielded about 0.17% this quarter as opposed to 0.20% in the fourth quarter of 2012. The LGIP is considered to be a very poor investment and is utilized solely for emergency cash needs at this point. Overnight rates in our bank accounts yield a higher rate than LGIP and so we have been maintaining larger balances there than we have done historically. The security portfolio earned 1.22 %, again dropping slightly from 1.25% in the 4th quarter as higher yielding securities continue to mature or be called and can only be replaced with securities that have much lower yields. Unbelievably, the market yields are still lower than our portfolio averages. Unfortunately this means that our callable securities will continue to be called and we will continue to earn lower returns upon reinvestment. Activity has stabilized as indicated by the reduction in the number of securities being called in the past 12 months. Only 7 of our current holdings are anticipated to be called in 2013 as opposed to the 27 that were called during 2011. The City's Bonded Debt Schedule Changes to the Debt Schedule include the new financing through the State of Washington LOCAL (Local Option Capital Asset Lending) program for the new Fire Apparatus. Due to a premium at issue, the City only had to finance $310,000 to pay for $362,000 in equipment. Bonds issued at a premium require the purchaser to pay an extra value roughly equal to the time - adjusted amount of interest they will earn over the market rate at the time of purchase. Of course this also means that the City will pay slightly more interest over the life of the bond issue in exchange for that premium. It is neither good nor bad —just timing. The first series of PFD Convention Center Bonds issued in 2007 were paid off last June and so that debt has dropped off the Schedule. May 21, 2013 Interfund Borrowings and Investments Two funds, Emergency Services and Refuse were temporarily in a negative cash position at the end of the first quarter. For a particular fund to be in a negative cash position for a few days or weeks is not an unusual occurrence due to the uneven flows of revenues and expenditures throughout the year, but especially in the first quarter. Certain fees and charges occur at the beginning of the calendar year that will expire month by month as the year progresses. General Fund loaned cash to these two funds during the first quarter. As per the City's Interfund Loan Program, adopted earlier this year, the General Fund will begin to charge interest if the loan continues more than one calendar quarter. Emergency Services is funded by Property Taxes, which are mostly realized by the City in May and November. The cash balance dropped below zero on February 28 and was fully recovered by May 10 with the Property Tax deposit. The negative cash balance that developed on March 31 in Refuse was rectified after only a few days in early April. City of Yakima Cash and Investment Summary March 31, 2013 Page 1 of 5 PDFConvert. 2631.1.TSO_Q1_2013_Reports.xlsx Book Balance Purchases Interest Percent of Average Average Description Qty Par Book Portfolio Yield Q4'12 Yield Q1'13 Cash Balances on Hand and in Banks $ 1,622 NA $ 11,052,542 NA NA NA Local Government Investment Pool (LGIP) 1 $ 3,802,300 3,802,300 8% 0.20% 0.17% Federal Agency Coupon and Discount 19 42,746,000 42,017,249 90% 1.25% 1.22% Other Investments 2 750,000 815,490 1% 1.77% 1.77% Total Invested 22 $ 47,298,300 $ 46,635,039 100% 1.17% 1.15% Page 1 of 5 PDFConvert. 2631.1.TSO_Q1_2013_Reports.xlsx Book Balance Purchases Interest Maturities, Calls Book Balance Summary of Investment Activity 1/1/2013 & Deposits Reinvested & Withdrawals 3/31/2013 Local Government Investment Pool (LGIP) $ 3,800,678 $ - $ 1,622 $ - $ 3,802,300 Federal Agency Coupon and Discount 40,023,853 3,993,396 - 2,000,000 42,017,249 Other Investments 815,490 - - 815,490 Totals $ 44,640,021 $ 3,993,396 $ 1,622 $ 2,000,000 $ 46,635,039 Page 1 of 5 PDFConvert. 2631.1.TSO_Q1_2013_Reports.xlsx City of Yakima Investment Portfolio - Inventory by Agency March 31, 2013 Expected Call Most Agency Inv# Face Value Price Coupon Step Yield Maturity Settle Next Call Type Likely Call Federal Farm Credit Bank CNTY 1442 500,000 565,490 5.000 1.631 7/1/15 8/19/11 7/1/15 NC 7/1/15 YF -CD 1447 FFCB 1462 2,000,000 2,000,000 1.290 1.290 9/25/18 9/25/12 9/25/13 Amer 9/25/13 FFCB Totals and Averag 2,000,000 2,000,000 $ 42,832,739 1.290 Federal Home Loan Bank FHLB 1456 2,000,000 2,289,700 5.630 2.050 6/13/16 3/12/12 6/13/16 NC 6/16/16 FHLB 1466 2,000,000 1,998,940 1.150 1.263 7/25/18 2/6/13 7/25/13 Qrty 7/25/13 FHLB 1467 2,000,000 1,994,456 0.850 1.427 10/30/17 2/6/13 7/30/13 Qrty 7/30/13 FHLB Totals and Averag 6,000,000 6,283,096 1.602 Federal Home Loan Mortgage Corporation FHLMC 1453 2,000,000 2,001,920 1.300 1.250 1/30/17 01/30/12 1/30/14 Qrty 1/30/14 FHLMC 1459 2,000,000 2,000,000 1.350 1.350 11/30.17 5/30.12 5/30/13 Qrty 5/30/13 FHLMC 1463 3,000,000 3,000,000 1.000 1.000 1/17/18 10/17/12 10/17/14 1x 10/17/14 FHLMC 1465 1,000,000 1,000,000 1.020 1.020 11/21/17 11/21/12 5/21/13 Qrty 5/21/13 FHLMC Totals and Ave 8,000,000 8,001,920 1.153 Federal National Management Association FNMA 1445 4,000,000 4,000,000 1.420 1.420 9/20/16 9/20/11 9/20/13 1x 9/20/13 FNMA 1448 1,750,000 1,750,000 1.000 1.000 9/9/15 9/9/11 9/9/13 1x 9/9/13 FNMA 1452 1,000,000 1,000,000 0.850 0.850 12/5/14 12/5/11 12/5/13 1x 12/5/13 FNMA 1460 5,000,000 4,737,030 1.100 1.100 6/1/17 6/28/12 6/1/17 NC 6/1/17 FNMA 1461 2,000,000 2,008,310 0.900 0.760 9/27/16 6/28/12 3/27/14 1x 3/27/14 FNMA Totals and Aver: 13,750,000 13,495,340 1.113 Financing Corporation FICO 1450 2,000,000 1,928,880 1.020 1.020 5/11/15 10/20/11 5/11/15 NC 5/11/15 FICO 1454 722,000 678,045 1.200 1.200 5/2/17 2/2/12 5/2/17 NC 5/2/17 FICO 1455 2,356,000 2,199,953 1.348 1.348 4/6/17 2/29/12 4/6/17 NC 4/6/17 FICO 1457 2,146,000 1,995,422 1.340 1.340 10/6/17 4/25/12 10/6/17 NC 10/6/17 FICO 1458 2,142,000 1,999,488 1.250 1.250 11/30/17 5/21/12 11/30/14 NC 11/30/14 FICO 1464 3,630,000 3,435,105 1.020 1.020 2/8/18 10/31/12 2/8/18 NC 2/8/18 FICO Totals and Averag 12,996,000 12,236,893 1.179 Other Investments CNTY 1442 500,000 565,490 5.000 1.631 7/1/15 8/19/11 7/1/15 NC 7/1/15 YF -CD 1447 250,000 250,000 2.050 2.100 3/30/16 8/31/11 2/28/15 NC 2/28/15 Other Totals and Averag 750,000 815,490 1.775 Grand Totals $ 43,496,000 $ 42,832,739 1.232 Average Expected Yield Page 2 of 5 PDFConvert. 2631.1.TS0_Ql_2013_Reports.xlsx City of Yakima Investment Portfolio - Detail of Activity Quarter Ending March 31, 2013 Yield Beginning Calls and Ending Date of Agency Inv# Rate Face Value Purchases Maturities Face Value Activity Federal Farm Credit Bureau FFCB 1462 1.290 2,000,000 2,000,000 FFCB Totals 2,000,000 - - 2,000,000 Federal Home Loan Bank FHLB 1456 2.050 2,000,000 2,000,000 FHLB 1466 1.260 2,000,000 2,000,000 2/6/13 FHLB 1467 1.427 2,000,000 2,000,000 2/6/13 FHLB Totals 2,000,000 4,000,000 - 6,000,000 Federal Home Loan Mortgage Corporation FHLMC 1438 2.000 2,000,000 (2,000,000) - 2/8/13 FHLMC 1453 1.250 2,000,000 2,000,000 FHLMC 1459 1.350 2,000,000 2,000,000 FHLMC 1463 1.000 3,000,000 3,000,000 FHLMC 1465 1.020 1,000,000 1,000,000 FHLMC Totals 10,000,000 - (2,000,000) 8,000,000 Federal National Management Association FNMA 1445 1.420 4,000,000 4,000,000 FNMA 1448 1.000 1,750,000 1,750,000 FNMA 1452 0.850 1,000,000 1,000,000 FNMA 1460 1.100 5,000,000 5,000,000 FNMA 1461 0.760 2,000,000 2,000,000 FNMA Totals 13,750,000 - - 13,750,000 Financing Corporation FICO 1450 1.020 2,000,000 2,000,000 FICO 1454 1.200 722,000 722,000 FICO 1455 1.348 2,356,000 2,356,000 FICO 1457 1.340 2,146,000 2,146,000 FICO 1458 1.250 2,142,000 2,142,000 FICO 1464 1.020 3,630,000 3,630,000 FICO Totals 12,996,000 - - 12,996,000 Other Investments Grays County Bonds 1442 5.000 500,000 500,000 Yakima Federal CD 1447 2.050 250,000 250,000 Other Investment Totals 750,000 - - 750,000 Grand Totals $ 41,496,000 $ 4,000,000 $ (2,000,000) $ 43,496,000 Page 3 of 5 PDFConvert. 2631.1.TS0_Q1_2013_Reports.xlsx City of Yakima Bonded Debt Schedule - by Project Group Quarter Ending March 31, 2013 Final Amount Current Redeemed Date Issued Payment Description Note Issued Balance Due This Quarter General Obligation Bonds $31,780,528 $20,603,268 $101,614 Certificate of Participation - State of Washington 9/7/2004 11/1/2019 PFD Convention Center II Refunded 1996 issue 4,175,000 2,500,000 0 5/8/2007 5/1/2026 PFD Convention Center III Partial refunding of 2002 issue 4,910,000 4,855,000 0 8/28/2009 12/1/2018 PFD Capitol Theatre Tax exempt portion 2,055,000 1,325,000 0 8/28/2009 12/1/2024 PFD Capitol Theatre Build America Bonds (Taxable) 1,755,000 1,755,000 0 8/28/2009 12/1/2032 PFD Capitol Theatre Build America Bonds (Taxable) 3,225,000 3,225,000 0 6/17/2003 12/1/2023 Sundome Expansion Deferred Interest - Maturity $2.5M 1,430,528 943,268 101,614 6/17/2003 12/1/2013 Law and Justice Center Refunded 1994 issue 4,155,000 500,000 0 9/7/2004 12/1/2014 Fire Station 2,300,000 560,000 0 8/28/2008 12/1/2021 Fire Apparatus Ladder Truck 760,000 555,000 0 5/8/2007 5/1/2022 Fire Station Remodel Facility 815,000 600,000 0 8/28/2008 12/1/2019 Infrastructure Projects Ped crossing, street, infrastructure 2,190,000 1,455,000 0 5/8/2007 5/1/2022 Downtown Futures Renovate downtown improvements 1,490,000 1,090,000 0 5/8/2007 5/1/2017 River Road River Road improvements 1,765,000 980,000 0 12/1/2005 12/1/2015 Parks and Recreation Parks improvements 755,000 260,000 0 Subtotal General Obligation Bonds $31,780,528 $20,603,268 $101,614 Certificate of Participation - State of Washington 6/1/2011 12/1/2020 Fire Apparatus Two trucks purchased $576,847 $472,526 $0 3/19/2013 7/1/2023 Fire Apparatus One truck $310,414 $310,414 $0 Revenue Bonds 12/2/2003 11/1/2014 Wastewater $7,390,000 $1,060,000 $0 5/31/2012 11/1/2023 Wastewater Refunded 2003 $10,155,000 issue 9,400,000 9,355,000 0 6/5/2008 11/1/2027 Wastewater 5,440,000 4,555,000 0 6/5/2008 11/1/2018 Water Refunded 1998 issue 1,883,951 1,210,000 0 9/4/2004 9/1/1934 Irrigation 5,215,000 4,345,000 0 Subtotal Revenue Bonds $29,328,951 $20,525,000 $0 Grand Total $61,419,893 $41,438,682 $101,614 Page 4 of 5 PDFConvert. 2631.1.TS0_Q1_2013_Reports.xlsx City of Yakima Interfund Borrowings and Investments Quarter Ending March 31, 2013 Original Beginning Ending Description Balance Balance Issued Retired Balance Investment Held by: Local Improvement District Bonds /Notes $ 1,432,509 $ 572,000 $ - $ 572,000 Equipment Rental Irrigation Capital Fund 1,432,509 436,000 30,000 406,000 Equipment Rental REET 1 - Upper Kiwanis Park 600,000 600,000 25,080 574,920 Equipment Rental Ending Cash Funds in Negative Cash Position at Quarter End Balance Cash Loaned by: Fund 150 - Emergency Services Fund 471 - Refuse (100,214) General Fund (88,634) General Fund Page 5 of 5 PDFConvert.2631.1.TS0_Q1_2013_Reports.xlsx