The URL can be used to link to this page

Home My WebLink AboutFS 2015-06-02 Item 2A - Report - 2015 First Quarter Investment ReportCity of Tukwila Jim Haggerton, Mayor INFORMATIONAL MEMORANDUM TO: Mayor Haggerton Finance and Safety Committee FROM: Peggy McCarthy, Finance Director BY: Vicky Carlsen, Deputy Finance Director DATE: May 27, 2015 SUBJECT: First Quarter 2015 Cash & Investment Report ISSUE The first quarter Investment Report is included with this memorandum and is discussed below. BACKGROUND City funds are invested to earn a reasonable return while preserving principal and allowing sufficient liquidity to meet the City's operating needs. To achieve these objectives investments are diversified by type, by financial institution, and by maturities in compliance with the City Investment Policy. DISCUSSION Portfolio Components At March 31, 2015, the portfolio totaled $43.8 million comprised of $36.3 million in cash and cash equivalents and $10.8 in longer term investments. The portfolio balance decreased by $1.6 million from December 31, 2014 balance of $45.4 million. A major reason for the decrease in funds is because property tax collections are primarily received in 2nd and 4th quarters while general fund expenditures are spread fairly evenly throughout the year. Additionally, Local Improvement District #33 assessments for the first installment that were received during the 4th quarter, were used to pay debt service due in January 2015. In March, the City purchased a Federal Home Loan Bank agency investment in the amount of $1 million. It was purchased on April 16, 2015 and will mature on March 16, 2018. This investment has a 1.27% yield to maturity. The investment mentioned above increases the percentage of the City's longer -term investments and increases portfolio yield because of the higher interest rate on the agency. Since it's a longer - term investment, it was placed in the contingency fund where the likelihood of accessing the available cash in the next few years is remote. The purchase of agency also increases the diversity of the portfolio. Portfolio Performance The portfolio weighted average yield on March 31, 2015, was .39 %. Considering the portfolio's weighted average maturity was 1.1 years, and the yield on the cash & cash equivalent accounts was .070%, the portfolio yield of 0.39% is still relatively favorable. The yield has been sustained by the 3.19% average yield on the municipal bond investments, the .21 % yield on the certificate of deposits, the .82% yield on the agencies, and the .45% earnings credit on the US Bank depository account. INFORMATIONAL MEMO Page 2 Investment income through the first quarter 2015 for cash equivalents and certificates of deposits is $29,882 plus $35,441 of accrued municipal bond and agencies interest for a total of $65,323 against a prorated budget of $46,772. Not included in the portfolio is interest earned from the operating and capital loans to the MPD. The operating loan is being repaid on a monthly basis and will be paid in full by May 2023. Interest earned on the loan for the first quarter 2015 is $4,658. The capital loan is being repaid semi- annually and will be paid in full by December 2022. Interest accrued for the first quarter 2015 is $4,217. Attached to the investment report are amortization schedules for both loans to the MPD. Policy Compliance and Liquidity Analysis As of the end of the 1St quarter, the portfolio profile is well within the range of all the investment policy parameters. There is currently a healthy mix of investments with a range of maturity dates. Current investments allow for adequate cash flow requirements. Fund Cash & Investment Balances The general fund balance shows a decrease of $1.9 million from December 31. As mentioned earlier, property tax revenue is received during the 2nd and 4th quarters. The arterial street fund reflects a timing difference on grant related expenditures. Debt service funds show an increase, primarily in Local Improvement District (LID) No. 33 (Fund 233). The first annual installment for the LID was due in October, 2014, and the bond payment was made in January 2015. Investment Environment Short term interest rates continue to remain low and are expected to remain low with slight upward adjustments by the end of 2015. Information from the Federal Reserve Board indicates that, while the first quarter showed meager growth, economic growth is expected to pick up in the coming months. The portfolio will continue to be managed to take advantage of investment opportunities as they arise. RECOMMENDATION Presentation is for information only. ATTACHMENTS Cash and Investment Report Policy Compliance & Liquidity Analysis Cash and Investment Balances by Fund Treasury Rates and Yield Curves Amortization Schedule — MPD Operating Loan Amortization Schedule — MPD Capital Loan 2 CITY OF TUKWILA CASH & INVESTMENT REPORT March 31, 2015 INVESTMENTS Certificates of Deposit Sound Community Bank Certificate of Deposit 3/4/2014 3/4/2017 3.0 3,000,000 3,154,478 0.85% 6,602 Regal Bank Certificate of Deposit 12/20/2014 12/20/2015 1.0 250,000 250,000 0.50% 223 CERTIFICATES OF DEPOSIT -- TOTAL 2.9 3,250,000 3,404,478 0.21% 6,826 Agencies Federal Home Loan Mtg Corp US agency 4/10/2014 5/13/2016 2.1 2,000,000 2,001,867 0.50% 10,000 (FHLMC) FNMA US agency 6/6/2014 8/23/2017 3.2 1,000,000 998,775 1.00% 10,008 Federal Home Loan Bank US agency 3/16/2015 3/16/2018 3.0 1,000,000 1,000,000 1.27% 12,700 TOTAL AGENCIES 2.6 4,000,000 4,000,642 (a) 32,708 (c) (d) Rating Purchase Maturity Term Par Book Yield to Annualized Agency / Issuer Moodys Investment Type Date Date Yrs Value Balance Maturity Return CASH & CASH EQUIVALENTS 5.6 500,000 502,176 3.60% 18,078 Center Facility 4.3 US Bank Depository Various (b) $14,879,983 $14,879,983 (e) 14,501 4.05% 20,358 0.45% Washington State Treasurer LGIP Investment Pool Various (b) 3,935,520 3,935,520 (f) 1,385 0.1579% Columbia Bank Money market Various (b) 14,121,061 14,121,061 (f) 7,170 0.22% Total Cash & Cash Equivalents 32,936,565 32,936,565 0.07% 23,056 INVESTMENTS Certificates of Deposit Sound Community Bank Certificate of Deposit 3/4/2014 3/4/2017 3.0 3,000,000 3,154,478 0.85% 6,602 Regal Bank Certificate of Deposit 12/20/2014 12/20/2015 1.0 250,000 250,000 0.50% 223 CERTIFICATES OF DEPOSIT -- TOTAL 2.9 3,250,000 3,404,478 0.21% 6,826 Agencies Federal Home Loan Mtg Corp US agency 4/10/2014 5/13/2016 2.1 2,000,000 2,001,867 0.50% 10,000 (FHLMC) FNMA US agency 6/6/2014 8/23/2017 3.2 1,000,000 998,775 1.00% 10,008 Federal Home Loan Bank US agency 3/16/2015 3/16/2018 3.0 1,000,000 1,000,000 1.27% 12,700 TOTAL AGENCIES 2.6 4,000,000 4,000,642 0.82% 32,708 Taxable Municipal Bonds City of Marysville, sinking Al LTGO Refunding 11/23/2010 12/1/2017 5.5 415,000 430,309 3.37% 14,501 2014 -2017, ave 5.5 years Washington State Convention Aa3 Lodging Tax Bonds 11/30/2010 7/1/2016 5.6 500,000 502,176 3.60% 18,078 Center Facility 4.3 10,640,000 10,823,102 1.37% 148,588 UW Biomedical Center Aal Revenue Bonds 12/14/2010 7/1/2017 6.6 500,000 502,655 4.05% 20,358 UW Biomedical Center Aal Revenue Bonds 12/14/2010 7/1/2019 8.6 500,000 503,302 4.70% 23,655 Douglas County, ESD, sinking Aal UTGO 12/23/2010 12/1/2020 8.9 1,135,000 1,147,313 4.55% 52,203 2018 -2020, ave 9 yrs Port of Anacortes Al LTGO 12/17/2010 9/1/2020 9.7 340,000 332,226 5.00% 16,611 TOTAL MUNICIPAL BONDS 7.7 3,390,000 3,417,982 3.19% 109,055 Total Investments 4.3 10,640,000 10,823,102 1.37% 148,588 TOTAL CASH, CASH EQUIVALENTS & INVESTMENTS 1.1 $ 43,576,565 $ 43,759,667 1 0.39% 1 $ 171,645 Current Portfolio 8% 10% 3 CITY OF TUKWILA Policy Compliance & Liquidity Analysis CASH & INVESTMENT REPORT March 31, 2015 Liauiditv Analvsis & Maturity Diversification Funds immediately available Fixed Maturity Investments, maturing in: 0 -90 days after Report Date 91 -180 days after Report Date Investments maturing in 1 year or less Investments maturing in 1 -3 years Investments maturing in 3 -5 years Investments maturing in 5 -7 years Investments maturing in 7 -10 years Investments maturing in more than 1 year and less than 10 years. As of Report Date Available Available Available in Portfolio Within 1 Year Within 5 5 - 10 Years Amount Years $ 32,936,565 250,000 8,590,261 503,302 1,479,540 10,573,102 $ 32,936,565 $ 32,936,565 250,000 250,000 8,590,261 503,302 1,479,540 TOTALS $ 43,759,667 $ 33,186,565 $42,280,127 $ 1,479,540 76% 97% 4% Liauiditv Requirements and Funds Available for Investina: Funds immediately available $ 32,936,565 Restrictions & designations: Operating liquidity (a) 14,000,000 Liquidity threshold 14,000,000 Funds available for longer term investing 18,936,565 (a) Represents largest one month decline in portfolio balance over the most recent 36 month period doubled; or the equivalent of a 100% cushion. Policy Met? Yes Note: Cash and cash equivalents are available within one day and are factored into the Total Portfolio weighted average maturity. 91 Portfolio POLICY Policy Financial Institution Diversification Amount % of Total MAXIMUM Met? US Bank $ 14,879,983 34.0% 50.0% Yes Washington State Treasurer 3,935,520 9.0% 75.0% Yes Columbia Bank 14,121,061 32.3% 50.0% Yes Sound Community Bank 3,154,478 7.2% 50.0% Yes Other financial institutions 7,668,624 17.5% 50.0% Yes Total $ 43,759,667 100.0% Portfolio POLICY Policy Investment Mix Amount % of Total MAXIMUM Met? Depository 14,879,983 34.0% insured by PDPC Yes State Investment Pool 3,935,520 9.0% 75.0% Yes Money market 14,121,061 32.3% insured by PDPC Yes Certificate of Deposit 3,404,478 7.8% insured by PDPC Yes US Agency 4,000,642 9.1% 75.0% Yes Municipal Bonds 3,417,982 7.8% no limit specified in policy Yes Total 43, 759, 667 100.0% Weighted Average Maturites: Years Performance Analysis Certificates of deposit 2.9 Current portfolio yield 0.39% Benchmarks: Municipal bonds 7.7 6 month treasury 0.14% Total Investments 4.3 2 year treasury 0.56% Total Portfolio 1.1 Local Govt Invst Pool (f) 0.1579% POLICY MAXIMUM 3.5 Policy Met? Yes Note: Cash and cash equivalents are available within one day and are factored into the Total Portfolio weighted average maturity. 91 CITY OF TUKWILA Cash & Investment Balances By Fund and Fund Group CASH & INVESTMENT REPORT March 31, 2015 5 Balances Balances Balances Balances Balances Fund Group 3/31/15 3/31/14 3/31/13 3/31/12 3131/11 General 000 GENERAL 5,941,116 $6,545,525 $ 944,197 $ 3,277,604 $3,181,257 General Total 5,941,116 6,545,525 944,197 3,277,604 3,181,257 Special Revenue 101 HOTEUMOTEL TAX 452,750 433,781 440,090 453,083 695,976 103 STREET 1,119,402 1,365,235 1,045,854 919,276 670,123 104 ARTERIAL STREET (56,259) 875,506 588,392 4,595,453 10,269,119 105 CONTINGENCY 5,772,086 5,764,212 1,461,267 1,457,930 1,456,606 107 FIRE EQUIP. CUM. RESERVE - - 945,312 943,501 804,457 109 DRUG SEIZURE FUND 49,977 68,308 147,083 226,462 283,337 Special Revenue Total 7,337,957 8,507,042 4,627,998 8,595,703 14,179,619 Debt Service 200 DEBT SERVICE 400 - - - - 206 L.I. GUARANTEE 669,147 668,997 - 207 LIMITED TAX G.O. BONDS 1999 - - - 13,246 208 LIMITED TAX G.O. BONDS 2000 - - - 70 70 209 LIMITED TAX G.O. BONDS 2003 1 1 3,012,901 3,302,738 (1,592) 210 LIMITED TAX G.O. REFUNDING 2003 195 195 (55) 853 (1,852) 211 LIMITED TAX G.O. REFUNDING 2008 416 416 (84) 5,105 (18,148) 212 LTGO SCORE BONDS 2 1,453 126 707 (146) 213 LTGO SCORE BLD AMER BONDS - - 995 616 (1,392) 214 LTGO 2010 Series A 2,710 5,910 (614) 37 37 215 LTGO 2010 Series B - - 4,612 4,611 17 216 VALLEY COM Refunding bonds 2010 794 74 14 14 814 217 LIMITED TAX GO BONDS REFUNDING 539 214 (299) - - 218 LTGO 2013 - - - 233 LID #33 121,290 42,591 - - Debt Service Total 795,493 719,850 3,017,595 3,314,751 (8,947) _ Capital Project 301 LAND ACQ, REC & PARK DEVLPMNT 1,336,048 1,159,087 1,088,513 1,665,327 4,787,800 302 FACILITY REPLACEMENT 1,037,559 1,967,648 2,103,024 2,019,099 2,051,032 303 GENERAL GOVERNMNT IMPROVEMENTS 399,945 404,809 804,988 584,287 1,310,709 304 FIRE IMPACT FEES 516,235 438,317 359,809 316,591 165,331 Capital Project Total 3,289,786 3,969,861 4,356,334 4,585,304 8,314,873 Enterprise 400 UTILITY ON ACCT (overpayments) 16,614 18,491 22,585 18,449 13,536 401 WATER 5,391,569 5,698,414 5,306,169 3,994,145 4,846,612 402 SEWER 4,937,844 3,431,464 1,917,966 1,219,446 1,605,340 404 WATER /SEWER REVENUE BONDS - - - - - 405 BOND RESERVE - - - 411 FOSTER GOLF COURSE 671,946 371,314 218,979 (143,232) (243,075) 412 SURFACE WATER 3,096,696 3,066,715 3,433,716 3,126,965 3,333,516 Enterprise Total 14,114,669 12,586,398 10,899,416 8,215,773 9,555,929 Internal Service 501 EQUIPMENT RENTAL 5,036,571 4,482,904 4,398,645 3,652,343 3,593,124 502 INSURANCE 4,764,528 5,491,187 6,559,638 6,502,805 5,953,383 503 INSURANCE - LEOFF 1 813,557 910,664 1,839,349 1,888,703 1,706,648 Internal Service Total 10,614,656 10,884,755 12,797,632 12,043,850 11,253,154 Grand Total 42,093,676 43,213,432 36,643,172 40,032,985 46,475,884 Funds not included in the Grand Total are the fiduciary funds and the MPD. However, these balances ($1,665,991) are included in the investment balances. 5 CITY OF TUKWILA Treasury Rates and Yield Curves CASH & INVESTMENT REPORT March 31, 2015 Ratac at March '11 gni 3mo 6mo 1 Yr 2Yr 3Yr 5Yr 10Yr 30Yr 0.03% 0.14% 0.26% 0.56% 0.89% 1.37% 1.94% 2.54% Source: US Department of the Treasury Rate % Change Change -0.02% -67% 0.07% 50% 0.13% 50% 0.12% 21% -0.01% -1% -0.36% -26% -0.79% -41% -1.02% -40% Rates at March 31, 2014 3mo 6mo 1 Yr 2Yr 3Yr 5Yr 10Yr 30Yr 0.05% 0.07% 0.13% 0.44% 0.90% 1.73% 2.73% 3.56% N. 7 MPD Operating Loan - through end of 2015 only Period Accumulated Interest (Date) Beg Bal Funding Payments Interest End Bal Interest Principal Pmt Pmt 10/1/2011 $ - $ 191,294 $ $ 319 $ 191,613 $ 319 11/1/2011 191,612.82 - - 319.35 191,932.18 638.18 12/1/2011 191,932.18 - - 319.89 192,252.07 958.07 1/1/2012 192,252.07 - - 320.42 192,572.49 1,278.49 2/1/2012 192,572.49 - - 320.95 192,893.44 1,599.44 3/1/2012 192,893.44 - - 321.49 193,214.93 1,920.93 4/1/2012 193,214.93 225,000.00 697.02 418,911.95 2,617.95 5/1/2012 418,911.95 - 698.19 419,610.14 3,316.14 6/1/2012 419,610.14 - 699.35 420,309.49 4,015.49 7/1/2012 420,309.49 - 700.52 421,010.01 4,716.01 8/1/2012 421,010.01 - 701.68 421,711.69 5,417.69 9/1/2012 421,711.69 - - 702.85 422,414.54 6,120.54 10/1/2012 422,414.54 433,706.00 - 1,426.87 857,547.41 7,547.41 11/1/2012 857,547.41 - - 1,429.25 858,976.66 8,976.66 12/1/2012 858,976.66 - - 1,431.63 860,408.28 10,408.28 1/1/2013 860,408.28 250,000.00 - 1,850.68 1,112,258.96 12,258.96 2/1/2013 1,112,258.96 - 1,853.76 1,114,112.73 14,112.73 3/1/2013 1,114,112.73 - 1,856.85 1,115,969.58 15,969.58 4/1/2013 1,115,969.58 - 1,859.95 1,117,829.53 17,829.53 Prior 5/1/2013 1,117,829.53 - 19,692.58 1,863.05 1,100,000.00 19,692.58 19,692.58 6/1/2013 1,100,000.00 - 10,121.48 1,833.33 1,091,711.85 21,525.91 8,288.15 1,833.33 7/1/2013 1,091,711.85 - 10,121.48 1,819.52 1,083,409.89 23,345.43 8,301.96 1,819.52 8/1/2013 1,083,409.89 - 10,121.48 1,805.68 1,075,094.10 25,151.12 8,315.80 1,805.68 9/1/2013 1,075,094.10 - 10,121.48 1,791.82 1,066,764.44 26,942.94 8,329.66 1,791.82 10/1/2013 1,066,764.44 - 10,121.48 1,777.94 1,058,420.90 28,720.88 8,343.54 1,777.94 11/1/2013 1,058,420.90 - 10,121.48 1,764.03 1,050,063.46 30,484.92 8,357.45 1,764.03 12/1/2013 1,050,063.46 - 10,121.48 1,750.11 1,041,692.08 32,235.02 8,371.37 1,750.11 1/1/2014 1,041,692.08 - 10,121.48 1,736.15 1,033,306.76 33,971.18 8,385.33 1,736.15 2/1/2014 1,033,306.76 - 10,121.48 1,722.18 1,024,907.45 35,693.35 8,399.30 1,722.18 3/1/2014 1,024,907.45 - 10,121.48 1,708.18 1,016,494.15 37,401.53 8,413.30 1,708.18 4/1/2014 1,016,49415 - 10,121.48 1,694.16 1,008,066.83 39,095.69 8,427.32 1,694.16 5/1/2014 1,008,066.83 - 10,121.48 1,680.11 999,625.46 40,775.80 8,441.37 1,680.11 6/1/2014 999,625.46 - 10,121.48 1,666.04 991,170.02 42,441.84 8,455.44 1,666.04 7/1/2014 991,170.02 - 10,121.48 1,651.95 982,700.49 44,093.79 8,469.53 1,651.95 8/1/2014 982,700.49 - 10,121.48 1,637.83 974,216.85 45,731.63 8,483.65 1,637.83 9/1/2014 974,216.85 - 10,121.48 1,623.69 965,719.06 47,355.32 8,497.79 1,623.69 10/1/2014 965,719.06 - 10,121.48 1,609.53 957,207.11 48,964.85 8,511.95 1,609.53 11/1/2014 957,207.11 - 10,121.48 1,595.35 948,680.98 50,560.20 8,526.13 1,595.35 12/1 /2014 948_680.98 ____10,121_48 1,581.13940,140.63 _52,141_338,54034 _ 1,581.14___`______ 1/1/2015 940,140.63 ___ -- - 10,121.48 _ 1,566.90 931,586.06 53,708.24 8,554.58 1,566.90 --� 2/1/2015 931,586.06 - 10,121.48 1,552.64 923,017.22 55,260.88 8,568.84 1,552.64 3/1/2015 923,017.22 10,121.48 1,538.36 914,434.10 56,799.24 8,583.12 1,538.36 4/1/2015 914,434.10 - 10,121.48 1,524.06 905,836.68 58,323.30 8,597.42 1,524.06 5/1/2015 905,836.68 - 10,121.48 1,509.73 897,224.93 59,833.03 8,611.75 1,509.73 Current 6/1/2015 897,224.93 - 10,121.48 1,495.37 888,598.82 61,328.40 8,626.11 1,495.37 7/1/2015 888,598.82 - 10,121.48 1,481.00 879,958.34 62,809.40 8,640.48 1,481.00 8/1/2015 879,958.34 - 10,121.48 1,466.60 871,303.46 64,276.00 8,654.88 1,466.60 9/11/2015 871,303.46 - 10,121.48 1,452.17 862,634.15 65,728.17 8,669.31 1,452.17 10/1/2015 862,634.15 - 10,121.48 1,437.72 853,950.39 67,165.89 8,683.76 1,437.72 11/1/2015 853,950.39 - 10,121.48 1,423.25 845,252.16 68,589.14 8,698.23 1,423.25 12/1/2015 845,252.16 - 10,121.48 1,408.75 836,539.44 69,997.90 8,712.73 1,408.75 7 Capital Loan to MPD Repayment Schedule MPD Capital Loan PAYMENT BEGINNING PRINCIPAL INTEREST INTEREST DUE DATE BALANCE PAYMENT RATE PAYMENT ENDING 2/1/2013 Amount loaned to the MPD 1,000,000.00 6/1/2013 1,000,000.00 (50,731.67) 0.02 (5,833.33) 949,268.33 12/1/2013 949,268.33 (48,258.90) 0.02 (8,306.10) 901,009.43 Prior 6/1/2014 901,009.43 (48,681.17) 0.02 (7,883.83) 852,328.26 12/1/2014 852,328_26 (49,107 13) 7_457.87)_ 803,221.13 6/1/2015 _ 803,221.13 _ _ -----0.02- (49,536.82) 0.02 _ _ (7,028.18) _ _ _ _ 753,684.31 Current 12/1/2015 753,684.31 (49,970.26) 0.02 (6,594.74) 703,714.05 6/1/2016 703,714.05 (46,537.07) 0.03 (10,027.93) 657,176.98 12/1/2016 657,176.98 (47,200.23) 0.03 (9,364.77) 609,976.75 6/1/2017 609,976.75 (47,872.83) 0.03 (8,692.17) 562,103.92 12/1/2017 562,103.92 (48,555.02) 0.03 (8,009.98) 513,548.90 6/1/2018 513,548.90 (49,246.93) 0.03 (7,318.07) 464,301.97 12/1/2018 464,301.97 (49,948.70) 0.03 (6,616.30) 414,353.27 6/1/2019 414,353.27 (48,277.93) 0.04 (8,287.07) 366,075.34 12/1/2019 366,075.34 (49,243.49) 0.04 (7,321.51) 316,831.85 6/1/2020 316,831.85 (50,228.36) 0.04 (6,336.64) 266,603.49 12/1/2020 266,603.49 (51,232.93) 0.04 (5,332.07) 215,370.56 6/1/2021 215,370.56 (52,257.59) 0.04 (4,307.41) 163,112.97 12/1/2021 163,112.97 (53,302.74) 0.04 (3,262.26) 109,810.23 6/1/2022 109,810.23 (54,368.80) 0.04 (2,196.20) 55,441.43 12/1/2022 55,441.43 (55,441.43) 0.04 (1,108.83) 0.00 (131,285.26) Rl