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2�pW N 0 'qq1 ios' GoS COUNCIL AGENDA REPORT DATE: November 14, 2012 TO: MAYOR AND TOWN COUNCIL FROM: GREG LARSON, TOWN MANAGER MEETING DATE: 11/19/12 ITEM NO: SUBJECT: FY 2012/13 QUARTERLY INVESTMENT REPORT (JULY THROUGH SEPTEMBER 2012) RECOMMENDATION: Accept attached First Quarter Investment Report for FY 2012/13. DISCUSSION: Attached for your consideration is the First Quarter Investment Report for FY 2012/13. The Town's overall investment rate of return has dropped below I% during the current quarter, down to .82 %. This rate continues to be higher than the current LAIF rate of .35 %. Market instability continues to affect the rates of returns available for any type of bonds. While most new investments will still be in callable bonds for the near future, other investments such as highly rated corporate bonds and treasuries will also be purchased so that a balance can be maintained in the Town's portfolio. FISCAL IMPACT: None Attachment: First Quarter Investment Report for FY 2012/13 (July through September 2012) PREPARED BY: V CONWAY Finance & Ad istrative ervices Director/ Town Treasurer Reviewed by: �° 5J Assistant Town Manager ( „Town Attorney Finance N: \TRS \Staff Reports\2011\ Treasurer's Report - Q1 2012 2013.doe °� THIS PAGE INTENTIONALLY LEFT BLANK Town of Los Gatos Quarterly Investment Report (Month Ended September 30, 2012) Prepared by Linda L. Speicher, Project Manager 11/14/12 Town of Los Gatos Summary Investment Information September 30, 2012 Weighted Average Portfolio Yield: 0.82% Weighted Average Maturity (days) 712 This Month Last Month One year ago Portfolio Balance $67,979,473 $70,793,188 $69,273,281 Benchmarks/ References: Town's Average Yield 0,82% 0.83% 1.29% LAIF Yield for month 0.11% 0.37% 0.38% 3 mo. Treasury 0,11% 0.11% 0.02% 6 mo. Treasury 0.14% 0.14% 0.04% 2 yr, Treasury 0.27% 0.27 % 0.25% 5 yr, Treasury (most recent) 0.65% 0.71% 1.02% Prime rate 3.25% 3.25% 3.25% Most recent auctions of Freddie Mac or Fannie Mae Reference Notes: 3 yr, Fannie Mae (08/17/12) 0.53% 2 yr. Freddie Mac (11/01/11) 0.38% Note: Both Fannie and Freddie have ceased offering 2 year notes for the time being, Compliance: The Town's investments are in compliance with the Town's investment policy dated May 1, 2008 and also in compliance with the requirements of Section 53601 of the California State Code. Based on the information available, the Town has sufficient kinds to meet the cash demands for the next six months. Page 1 Town of Los Gatos Portfolio Allocation & Treasurer's Fund Balances September 30, 2012 Month Fund Balances - Beginning of Month/Period $70,793,187.98 Receipts 1,116,198.65 Disbursements (3,929,913.20) Fund Balances - End of Month/Period $67,979,473.43 Portfolio Allocation: Union MM $447,883.09 US Govt Agencies 46,576,423.68 Local Agency Investment Fund 14,120,718.65 Subtotal - Investments 61,145,025.42 Reconciled Demand Deposit Balances 6;834,448.01 Total Treasurer's Fund $67,979,473.43 Portfolio Investment Allocation Union MM 0.7% YTD $75,558,782.33 5,658,852.18 (13,238,161.08) $67,979,473.43 Treasury, Agencies, & Corp. Notes 57.8% Treasurer's Fund Balances 80,000,000 ......... ................................................................................. ............................... 78,000,000 76,000,000 74,000,000 72,000,000 70,000,000 68,000,000 66,000,000 64,000,000 62,000,000 60,000,000 ..................... ............................... v� o z Q w d d n page 2 These accounts are not part of the Treasurer's fund balances reported elsewhere in this report, as they are for separate and distinct entities. Note 1: This account include redemption accounts setup for the repayment of interest and principal on outstanding bond coupons for Parking Assessment District'3', as well as Reserve Funds set up as required by the original Bond resolution. Note 2: The reserve fiord was a requirement of the original certificates of participation agreement when Lot 4 was built. It helps to guarantee payment of the lease payments should the Town not make payment. Note 3: The lease payment fund receives the lease payments fi•om the Town monthly for the lease of Lot 4. It holds the funds until payments on the certificates of participation are due semi - annually. Note 4: The three fiords for the Certificates of Participation 2002 Series A consist of construction funds which will be expended over the next few years, reserve funds which will guarantee the payment of lease payments, and a third fluid for the disbursement of lease payments and initial delivery costs. Note 5: The 2010 COP Funds are all for the Library construction, reserves to guarantee lease payments, and a lease payment fiord for the life of the COP issue. The COI fund will be closed in September 2010. Page 3 Town of Los Gatos Non - Treasury Restricted Fund Balances September 30, 2012 Previous Ending Balance Deposits Interest Withdrawals Balance Non - Treasury Funds: Downtown Parking District 12/20/02 $285,339.83 $176.91 $285,516.74 Note i Certificates of Participation Reserve Fund (Lot 4) 233,136.29 0.00 233,136.29 Note z Cert, of Participation Lease Payment Fund (Lot 4) 21,000,00 0.00 21,000.00 Note 3 Cert, of Participation 2002 Series A Reserve Fund 686,251.19 5.85 5.85 686,251.19 Note 4 Cert, Of Participation 2002 Ser A Lease Pymt Fund 0.00 0.00 0,00 Note 4 Ceti. of Participation 2002 Series A Const Fluid 42,488.58 34.84 42,523.42 Note 4 COP 2010 Library Reserve Fund 1,277,062.50 0.00 1,277,062.50 Note 5 COP 2010 Library Lease Fund 0,00 0.00 0.00 0.00 Note 5 COP 2010 Library ACQ Construction Fund 0.00 0.00 0.00 Note 5 COP 2010 Library COI Fund 0,00 0.00 0.00 Note 5 COP 2010 Library Good Faith 0.00 0.00 0.00 Note 5 Total Restricted Funds: $2,545,278.39 $0.00 $217.60 $5.85 $2,545,490.14 These accounts are not part of the Treasurer's fund balances reported elsewhere in this report, as they are for separate and distinct entities. Note 1: This account include redemption accounts setup for the repayment of interest and principal on outstanding bond coupons for Parking Assessment District'3', as well as Reserve Funds set up as required by the original Bond resolution. Note 2: The reserve fiord was a requirement of the original certificates of participation agreement when Lot 4 was built. It helps to guarantee payment of the lease payments should the Town not make payment. Note 3: The lease payment fund receives the lease payments fi•om the Town monthly for the lease of Lot 4. It holds the funds until payments on the certificates of participation are due semi - annually. Note 4: The three fiords for the Certificates of Participation 2002 Series A consist of construction funds which will be expended over the next few years, reserve funds which will guarantee the payment of lease payments, and a third fluid for the disbursement of lease payments and initial delivery costs. Note 5: The 2010 COP Funds are all for the Library construction, reserves to guarantee lease payments, and a lease payment fiord for the life of the COP issue. The COI fund will be closed in September 2010. Page 3 Interest received from Investments Interest accrued /(prepaid) at end of period (see page 5) Interest accrued /(prepaid) at beginning of period Interest earned on investments Town of Los Gatos Statement of Interest Earned September 30, 2012 Interest by Month July 2012 August 2012 September 2012 October 2012 November 2012 December 2012 January 2013 February 2013 March 2013 April 2013 May 2013 June 2013 Page 4 Current Month 10,211.03 - 3,663.20 - 34,696.12 $41,243.95 $50,686.03 40,230.09 41,243.95 Fiscal Year to Date 133,254.85 - 3,663.20 - 2,568.42 $132,160.07 Market to Cost Position Report Town of Los Gatos Amortized Market Unrealized * Source: Treasury and Agency Obligations - Union Bank of California Institution Cost Value* Gain (Loss) LAIF balances per Local Agency Investment Fund monthly statement. BNY Assets $46,562,720.91 $46,477,334.55 Inactive Deposits by Institution 447,883.09 447,883,09 0.00 Purchased Interest 13,702.77 13,702.77 0.00 LAIF 14,120,718.65 14,120,718.65 Market to Cost Position Report $61,145,025.42 $61,059,639.06 - $85,386.36 September 30, 2012 Deposit Amortized Maturity Days Days to Days Yield to Interest Interest Interest Institution Securit y Date Cost Date Elapsed Maturity Invested Maturity Earned Received Accrued GE Corporate Note 01116108 1,542,165.00 10/19/12 1719 19 1738 4.587% 333,152.13 335,343.75 (2,191.62) ING CP Comm. Paper 08/24/12 3,994,133.33 12/12/12 37 73 110 0.487% 1,971.79 1,971.79 GE Corporate Note 07/29/10 511,955.00 01/08/13 794 100 894 1.791% 19,945.96 27,183.33 (7,237.37) Treasury Coupon Note 03/31/11 1,997,968.75 03/31/13 549 182 731 0.801% 24,1:171.36 15,000,(10 9,071.36 FHLMC Coupon Note 03/25/11 1,016,520.00 04/15/13 555 197 752 0.812% 12,550.82 17,152.78 (4,601.96) NY Life Corporate Note 07/22/11 534,350.00 05/09/13 436 221 657 0.791% 5,048.89 18,535.42 (13,486.53) TIAA Corporate Note 04/11/11 880,446.95 07/15/13 538 288 826 1.334% 17,312.05 50,876.37 (33,564.32) FHLMC Callable Note 01/06/12 2,001,000.00 10/18/13 268 383 651 0.472% 6,934.75 2,833.33 4,101.42 NY Life Coupon Note 01/25/12 2,041,000.00 12/13/13 249 439 688 0.753% 10,484.42 14,183.33 (3,698.91) FHLMC Coupon Note 09116111 2,026,080.00 08/20/14 380 689 1069 0.527% 11,116.24 18,555.55 (7,439.31) FFCB Callable Note 11/21/11 997,500.00 11/21/14 314 782 1096 0.815% 6,993.70 3,650.00 3,343.70 FFCB Callable Note 12/19/11 2,000,000.00 12/19/14 286 810 1096 0050% 11,753.42 7,500.00 4,253.42 FNMA Callable Note 10/31/11 750,0()0.00 01/26/15 335 848 1183 1.000% 6,883.56 5,520.83 1,362.73 FNMA Callable Note 10/07/11 1,296,875.00 02/18/15 359 871 1230 0.866% 11,046.32 21,597.22 (10,550.90) FNMA Callable Note 04/23/12 1,513,470.00 04/23/15 160 935 1095 0.946% 6,276.13 6,276.13 Treasury Note 08/16/11 1,042,812.50 07/31/15 411 1034 1445 0.652% 7,656.02 16,739.13 (9,083.11) FNMA Callable Note 09/09/11 2,000,000.00 09/09/15 387 1074 1461 1.000% 21,205.48 20,000.00 1,205.48 Berk Hath Coupon Note 01/26/12 1,315,137.50 12/15/15 248 1171 1419 1.077% 9,623.78 11,824.65 (2,200.87) FNMA Callable Note 01/25/12 2,503,906.25 01/25/16 249 1212 1461 1:060% 18,106.33 13,750.00 4,356.33 FNMA Callable Note 04/04/12 2,002,500.00 04/04/16 179 1282 1461 1.058% 10,390.07 10,3911.07 FHLMC Callable Note 08/15/12 2,010,200.00 05/16/16 46 1324 1370 0.861% 2,181,26 2,181.26 FHLMC Callable Note 08/16/12 1,005,000.00 05/16/16 45 1324 1369 0,864% 1,070.53 1,070.53 Treasury Note 08/16/11 1,025,390.63 07/31/16 411 1400 1811 0.973% 11,234.43 14,347.83 (3,113.40) FNMA Callable Note 12/05/11 1,000,000.00 12/05/16 300 1527 1827 1.000% 8,219.18 5,000.00 3,219.18 FNMA Callable Note 05/25/12 3,033,660.00 05/03/17 128 1676 1804 1.512% 16,085.55 16,085,55 FHLMC Callable Note 06/08/12 2,007,700.00 06/06/17 114 1710 1824 1.120% 7,023.10 7;023.10 FI-IMC Callable Note 06/28/12 2,507,250.00 06/14/17 94 1718 1812 0.139% 897.53 897.53 FNMA Callable Note 06/29/12 2,005,700.00 06/14/17 93 1718 1811 0.800% 4,088.33 4,088.33 Subtotal 46,562,720.91 BNYMM 447,883,09 30 30 0.00% 0.00 0.00 Purchased Interest 13,702.77 LAW N/A 06/30/12 14,120,718.65 09/30/12 92 0 92 0.35% 12,607.19 12,607.19 $61,145,025,42 712 0.82% $615,930.32 $619,593,52 ($3,663.20) Maturity Profile Amount Percent 0 -1 year $25,059,843.54 40.98% 1 -2 years $6,068,080.00 9.92% 2 -3 years $9,600,657.50 15.70 %a 3 -5 years $20,416,444.38 33.39% $61,145,025.42 100.00% Market to Cost Position Report Amortized Market Unrealized * Source: Treasury and Agency Obligations - Union Bank of California Institution Cost Value* Gain (Loss) LAIF balances per Local Agency Investment Fund monthly statement. BNY Assets $46,562,720.91 $46,477,334.55 (85,386.36) BNYMM 447,883.09 447,883,09 0.00 Purchased Interest 13,702.77 13,702.77 0.00 LAIF 14,120,718.65 14,120,718.65 0.00 Totals: $61,145,025.42 $61,059,639.06 - $85,386.36 page 5 Town of Los Gatos Quarterly Investment Report (Month Ended August 31, 2012) Prepared by Linda L. Speicher, Project Manager 11/08/12 Town of Los Gatos Summary Investment Information August 31, 2012 Weighted Average Portfolio Yield: 0.83% Weighted Average Maturity (days) This Month Last Month One year ago Portfolio Balance $70,793,188 $71,970,988 $73,499,699 Benchmarks/ References: Town's Average Yield 0.83% 0.97% 1.39% LAIF Yield for month 0.37% 0.37% 0.41% 3 mo. Treasury 0.11% 0.11% 0.02% 6 mo, Treasury 0.14% 0.15% 0.05% 2 yr, Treasury 0.27% 0.22% 0.22% 5 yr. Treasury (most recent) 0.71% 0.58% 1.03% Prime rate 3.25% 3.25% 3.25% Most recent auctions of Freddie Mac or Fannie Mae Reference Notes: 3 yr. Fannie Mae (08/17/12) 0.53% 2 yr. Freddie Mac (11 /01 /11) 0.38 % Note: Both Fannie and Freddie have ceased offering 2 year notes for the tirne being. 742 Compliance: The Town's investments are in compliance with the Town's investment policy dated May 1, 2008 and also in compliance with the requirements of Section 53601 of the California State Code. Based on the information available, the Town has sufficient funds to meet the cash demands for the next six months. Page I Torun of Los Gatos Portfolio Allocation & Treasurer's Fund Balances August 31, 2012 Month Fund Balances - Beginning of Month/Period $71,970,987.56 Receipts 2,436,548.03 Disbursements (3,614,347.61) Fund Balances - End of Month/Period $70,793,187.98 Portfolio Allocation; Union MM $437,883.09 US Govt Agencies 46,576,423.68 Local Agency Investment Fund 14,120,718.65 Subtotal - Investments 61,135,025.42 Reconciled Demand Deposit Balances 9,658,162.56 Total Treasurer's Fund $70,793,187.98 Portfolio Investment Allocation Union MM 0.7% YTD $75,558,782.33 4,542,653.53 (9,308247.88) $70,793,187.98 Treasury, Agencies, & Corp, Notes 57.8% Treasurer's lAmd Balances 80,000,000 ....... ............................................................ .................. ............ .............. ....... ............ 78,000,000 76,000,000 74,000,000 72,000,000 70,000,000 68,000,000 66,000,000 0 64 0 000 0 62,000,000 60 , 000 , 000 O Z Q w d Q page 2 These accounts are not part of the Treasurer's fund balances reported elsewhere in this report, as they are for separate and distinct entities, Note 1: This account include redemption accounts set up for the repayment of interest and principal oil outstanding bond coupons for Parking Assessment District'3', as well as Reserve Funds set up as required by the original Bond resolution. Note 2: The reserve fund was a requirement of the original certificates of participation agreement when Lot 4 was built. It helps to guarantee payment of the lease payments should the Town not make payment. Note 3: The lease payment fund receives the lease payments from the Town monthly for the lease of Lot 4, It holds the fiords until payments on the certificates of participation are due semi - annually. Note 4: The three fiords for the Certificates of Participation 2002 Series A consist of construction funds which will be expended over the next few years, reserve fiords which will guarantee the payment of lease payments, and a third fund forthe disbursement of lease payments and initial delivery costs. Note 5: The 2010 COP Funds are all for the Library construction, reserves to guarantee lease payments, and a lease payment fluid for the life of the COP issue. The COI fimd will be closed in September 2010. Page 3 Town of Los Gatos Non - Treasury Restricted Fund Balances August 31, 2012 Previous Ending Balance Deposits Interest Withdrawals Balance Non- Treasury Funds: Downtown Parking District 12/20/02 $285,163.03 $176.80 $285,339.83 Note i Certificates of Participation Reserve Fund (Lot 4) 254,136.26 0.00 20,999.97 233,136.29 Note 2 Cert. of Participation Lease Payment Fluid (Lot 4) 225,000.03 41,999.97 0.00 246,000.00 21,000.00 Note 3 Cert. of Participation 2002 Series A Reserve Fund 686,251.19 5.85 5.85 686,251.19 Note 4 Cert. Of Participation 2002 Ser A Lease Pymt Fund 479,720.00 0.00 479,720.00 0.00 Note 4 Cert, of Participation 2002 Series A Const. Fend 42,488.58 0.00 42,488.58 Note 4 COP 2010 Library Reserve Fund 1,277,062.50 0,00 1,277,062.50 Note 5 COP 2010 Library Lease Fund 963,412.50 0.00 963,412.50 0.00 Note 5 COP 2010 Library ACQ Construction Fund 0.00 0.00 0.00 Note 5 COP 2010 Library COI Fund 0.00 0.00 0.00 Note 5 COP 2010 Library Good Faith 0.00 0,00 0.00 Note 5 Total Restricted Funds: $4,213,234.09 $41,999.97 $182.65 $1,710,138.32 $2,545,278.39 These accounts are not part of the Treasurer's fund balances reported elsewhere in this report, as they are for separate and distinct entities, Note 1: This account include redemption accounts set up for the repayment of interest and principal oil outstanding bond coupons for Parking Assessment District'3', as well as Reserve Funds set up as required by the original Bond resolution. Note 2: The reserve fund was a requirement of the original certificates of participation agreement when Lot 4 was built. It helps to guarantee payment of the lease payments should the Town not make payment. Note 3: The lease payment fund receives the lease payments from the Town monthly for the lease of Lot 4, It holds the fiords until payments on the certificates of participation are due semi - annually. Note 4: The three fiords for the Certificates of Participation 2002 Series A consist of construction funds which will be expended over the next few years, reserve fiords which will guarantee the payment of lease payments, and a third fund forthe disbursement of lease payments and initial delivery costs. Note 5: The 2010 COP Funds are all for the Library construction, reserves to guarantee lease payments, and a lease payment fluid for the life of the COP issue. The COI fimd will be closed in September 2010. Page 3 Interest received from Investments Add: Interest accrued at end of period (see page 5) Less: Interest accrued at beginning of period Interest earned on investments Town of Los Gatos Statement of Interest Earned August 31, 2012 Interest by Month July 2012 August 2012 September 2012 October 2012 November 2012 December 2012 January 2013 February 2013 March 2013 April 2013 May 2013 June 2013 Page 4 Current Month 49,262.53 - 34,696.12 - 25,663.68 $40,230.09 $50,686.03 40,230.09 Fiscal Year to Date 123,043.82 - 34,696.12 - 2,568.42 $90,916.12 page 5 Town of Los Gatos Inactive Deposits by Institution Market to Cost Position Report August 31, 2012 Deposit Amortized Maturity Days Days to Days Yield to Interest Interest Interest Institution Security Date Cost Dote Elapsed Maturity Invested Maturit Earned Received Accrued GE Corporate Note 01/16/08 1,542,165.00 10/19/12 1689 49 1738 4.587% 327,337.96 335,343,75 (8,005.79) ING CP Comm, Paper 08/24/12 3,994,133.33 12/12/12 7 103 110 0.487% 373.04 373.04 GE Corporate Note 07/29/10 511,955,00 01/08/13 764 130 894 1.791% 19,192.34 27,183.33 (7,990,99) Treasury Coupon Note 03/31/11 1,997,968,75 03/31/13 519 212 731 0.801% 22,755.99 15,000.00 7,755.99 FHLMC Coupon Note 03/25/11 1,016,520,00 04/15/13 525 227 752 0.812% 11,872.40 17,152.78 (5,280.38) NY Life Corporate Note 07/22/11 534,350,00 05/09/13 406 251 657 0.791% 4,701.49 18,535.42 (13,833.93) TIAA Corporate Note 04/11/11 880,446.95 07/15/13 508 318 826 1.334% 16,346.69 50,876.37 (34,529.68) FHLMC Callable Note 01/06/12 2,001,000.00 10/18/13 238 413 651 0.472% 6,158.47 2,833.33 3,325.14 NYLife Coupon Note 01/25/12 2,041,000,00 12/13/13 219 469 688 0,753% 9,221.24 14,183.33 (4,962.09) FHLMC Coupon Note 09116111 2,026,080.00 08/20/14 350 719 1069 0,527% 10,238.64 18,555.55 (8,316.91) FFCB Callable Note 11/21/11 997,500.00 11/21/14 284 812 1096 0.815% 6,325.52 3,650.00 2,675.52 FFCB Callable Note 12/19/11 2,000,000,00 12/19/14 256 840 1096 0.750% 10,520.55 7,500,00 3,020.55 FNMA Callable Note 10/31/11 750,000.00 01/26/15 305 878 1183 1,000% 6,267.12 5,520.83 746.29 FNMA Callable Note 10/07/11 1,296,875.00 02/18/15 329 901 1230 0.866% 10,123.23 21,597.22 (11,473.99) FNMA Callable Note 04/23/12 1,513,470,00 04/23/15 130 965 1095 0.946% 5,099.36 5,09936 Treasury Note 08/16/11 1,042,812.50 07/31/15 381 1064 1445 0.652% 7,097,18 16,739.13 (9,641.95) FNMA Callable Note 09/09/11 2,000,000.00 09/09/15 357 1104 1461 1.000% 19,561.64 1(),0()0.()0 9,561.64 Bork Hath Coupon Note 01/26/12 1,315,137.50 12/15/15 218 1201 1419 1.077% 8,459.61 11,824.65 (3,365.04) FNMA Callable Note 01/25/12 2,503,906,25 01/25/16 219 1242 1461 1.060% 15,924.84 13,750.00 2,174.84 FNMA Callable Note 04/04/12 2,002,500.00 04/04/16 149 1312 1461 1.058% 8,648,72 8,648.72 FHLMC Callable Note 08/15/12 2,010,200.00 05/16/16 16 1354 1370 0.861% 758,70 758.70 FHLMC Callable Note 08/16/12 1,005,000.00 05116116 15 1354 1369 0.864% 356.84 356.84 Treasury Note 08/16/11 1,025,390,63 07/31/16 381 1430 1811 0.973% 10,414.40 14,347.83 (3,933.43) FNMA Callable Note 12/05/11 1,000,000.00 12/05/16 270 1557 1827 1.001% 7,397.26 5,000.00 2,397.26 FNMA Callable Note 05/25/12 3,033,660.00 05/03/17 98 1706 1804 1.512% 12,315.50 12,315.50 FHLMC Callable Note 06/08/12 2,007,700.00 06/06/17 84 1740 1824 1.120% 5,174.92 5,174.92 FHLMC Callable Note 06/28/12 2,507,250.00 06/14/17 64 1748 1812 0.139% 611.08 611.08 FNMA Callable Note 06/29/12 2,005,700.00 06/14/17 63 1748 1811 0.800% 2,769.51 2,769.51 Subtotal 46,562,720.91 BNYMM 437,883.09 30 30 0'00% 0.00 0,00 Purchased Interest 13,702.77 LAW N/A 06/30/12 14,120,718.65 09/30/12 62 30 92 0.37% 8,873.15 8,873.15 $61,135,025.42 742 0.83% $574,897.40 $609,593,52 ($34,696.12) Maturity Profile Amount Percent 0 -1 year $25,049,843.54 40.97% 1 -2 years $6,068,080.00 9.93% 2 -3 years $7,600,657.50 12.43% 3 -5 years '$22,416,444.38 36.67% $61,135,025.42 100.00% Market to Cost Position Report Amortized Market Unrealized * Source: Treasury and Agency Obligations - Union Bank of California Institution Cost Value* Gain (Loss) LAIF balances per Local Agency Investment Fund monthly statement. BNY Assets $46,562,720.91 $46,511,071.45 (51,649.46) BNtY MM 437,883,09 437,883.09 0.00 Purchased Interest 13,702.77 13,702.77 0.00 LAW 14,120,718,65 14,120,718.65 0.00 Totals: $61,135,025.42 $61,083,375.96 - $51,649.46 page 5 Town of Los Gatos Quarterly Investment Report (Month Ended July 31, 2012) Prepared by Linda L. Speicher, Project Manager 11/08/12 Weighted Average Portfolio Yield: Town of Los Gatos Summary Investment Information July 31, 2012 0.97% This Month Last Month Portfolio Balance $71,769,523 $75,558,782 Benchmarks/ References: Weighted Average Maturity (days) One year at! $73,439,680 Town's Average Yield 0.97% 0.97% 1.49% LAIF Yield for month 0.37% 0.37% 0.38% 3 mo, Treasury 0.11% 0.10% 0,06% 6 mo, Treasury 0,15% 0.15% 0.10% 2 yr. Treasury 0,22% 0.31% 0.42 % 5 yr. Treasury (most recent) 0.58% 0.75% 1.62% Prime rate 3.25% 3.25% 3.25% Most recent auctions of Freddie Mae or Fannie Mae Reference Notes: 3 yr. Fannie Mae (08/17/12) 0.53% 2 yr. Freddie Mac (11/01/11) 0.38% Note: Both Fannie and Freddie have ceased offering 2 year notes for the time being. 747 Compliance: The Town's investments are in compliance with the Town's investment policy dated May 1, 2008 and also in compliance with the requirements of Section 53601 of the California State Code. Based on the information available, the Town has sufficient funds to meet the cash demands for the next six months. Page 1 Town of Los Gatos Portfolio Allocation & Treasurer's Fund Balances July 31, 2012 Month Fund Balances - Begiiming of Month/Period $75,558,782.33 Receipts 2,106,105.50 Disbursements (5,693,900.27) Fund Balances- End of Month/Period $71,970,987.56 Portfolio Allocation; Union MM $366,910.86 US Govt Agencies 46,598,399.24 Local Agency Investment Fund 14,120,718.65 Subtotal - Itivestments 61,086,028.75 Reconciled Demand Deposit Balances 10,884,958.81 Total Treasurer's Fund $71,970,987.56 Portfolio Investment Allocation Union MM 0.6% YTD $75,558,782.33 2,106,105.50 ,(5,693.900.271 $71,970,987.56 Treasury, Agencies, & Corp. Notes 57.8% Treasurer's Fund Balances 80,000,000 .,.. ................................................. 78,000,000 76,000,000 0 7 4 00 0 0 0 ^" 72,000,000 :::. r..::: s:•> .::::: :::::..:.::.::.:..,,•:::::::::: 70,000,000 68,000,000 000 6 0 000 6 00 64 0 00 000 62,000,000 000 60,000 N N N N N N N o Z Q ro W page 2 These accounts are not part of the Treasurer's fiord balances reported elsewhere in this report, as they are for separate and distinct entities. Note 1: This account include redemption accounts set up for the repayment of interest and principal on outstanding bond coupons for Parking Assessment District 'T, as well as Reserve Funds set up as required by the original Bond resolution. Note 2: The reserve fiord was a requirement of the original certificates of participation agreement when Lot 4 was built. It helps to guarantee payment of the lease payments should the Town not make payment. Note 3: The lease payment fiord receives the lease payments from the Town monthly for the lease of Lot 4. It holds the fiords until payments on the certificates of participation are due semi - annually. Note 4: The three fiords for the Certificates of Participation 2002 Series A consist of construction funds which will be expended over the next few years, reserve funds which will guarantee the payment of lease payments, and a third fiord for the disbursement of leasepayments and initial delivery costs. Note 5: The 2010 COP Funds are all for the Library construction, reserves to guarantee lease payments, and a lease payment fiord for the life of the COP issue. The COI fiord will be closed in September 2010, Page 3 Town of Los Gatos Non - Treasury Restricted Fund Balances July 31, 2012 Previous Ending Balance Deposits Interest Withdrawals Balance Non - Treasury Funds: Downtown Parking District 12 /20/02 $284,992.03 $171.00 $285,163.03 Note I Certificates of Participation Reserve Fund (Lot 4) 254,136.26 0.00 254,136.26 Note 2 Ceti. of Participation Lease Payment Fund (Lot 4) 204,000.03 21,000.00 0.00 225,000.03 Note Cert, of Participation 2002 Series A Reserve Fund 686,251.19 5.66 5.66 686,251.19 Note 4 Cert. Of Participation 2002 Ser A Lease Pymt Fund 0.00 479,720.00 0.00 479,720.00 Note 4 Cert. of Participation 2002 Series A Const. Fund 42,488.58 0.00 42,488.58 Note 4 COP 2010 Library Reserve Fund 1,277,062.50 0.00 1,277,062.50 Notes COP 2010 Library Lease Fund 0.00 963,412.50 0;00 963,412.50 Note 5 COP 2010 Library ACQ Construction Fund 0.00 0,00 0.00 Note 5 COP 2010 Library COI Fund 0.00 0.00 0.00 Note 5 COP 2010 Library Good Faith 0,00 0.00 0.00 Note 5 Total Restricted Funds: $2,748,930.59 $1,464,132.50 $176,66 $5.66 $4,213,234.09 These accounts are not part of the Treasurer's fiord balances reported elsewhere in this report, as they are for separate and distinct entities. Note 1: This account include redemption accounts set up for the repayment of interest and principal on outstanding bond coupons for Parking Assessment District 'T, as well as Reserve Funds set up as required by the original Bond resolution. Note 2: The reserve fiord was a requirement of the original certificates of participation agreement when Lot 4 was built. It helps to guarantee payment of the lease payments should the Town not make payment. Note 3: The lease payment fiord receives the lease payments from the Town monthly for the lease of Lot 4. It holds the fiords until payments on the certificates of participation are due semi - annually. Note 4: The three fiords for the Certificates of Participation 2002 Series A consist of construction funds which will be expended over the next few years, reserve funds which will guarantee the payment of lease payments, and a third fiord for the disbursement of leasepayments and initial delivery costs. Note 5: The 2010 COP Funds are all for the Library construction, reserves to guarantee lease payments, and a lease payment fiord for the life of the COP issue. The COI fiord will be closed in September 2010, Page 3 Interest received from Investments Add: Interest accrued at end of period (see page 5) Less: Interest accrued at beginning of period Interest earned on investments Town of Los Gatos Statement of Interest Earned July 31, 2012 Interest by Month July 2012 August 2012 September 2012 October 2012 November 2012 December 2012 January 2013 February 2013 March 2013 April 2013 May 2013 June 2013 Page 4 Current Month 73,781.29 - 25,663.68 - 2,568.42 $50,686.03 $50,686.03 Fiscal Year to Date 73,781.29 - 25,663.68 - 2,568.42 $50,686.03 Market to Cost Position Report Amortized Market Unrealized * Source: Treasury and Agency Obligations - Union Bank of California Town of Los Gatos Cost Value* Gain (Loss) LAIF balances per Local Agency Investment Fund monthly statement. BNY Assets $46,592,140.91 $46,530,474.28 (61,666.63) BNYMM 366,910.86 366,910.86 Inactive Deposits by Institution 6,258.33 6,258.33 0.00 LAIF 14,120,718.65 14,120,718,65 0.00 Totals: $61,086,028.75 $61,024,362.12 Market to Cost Position Report July 31, 2012 Deposit Amortized Maturity Days Days to Days Yield to Interest Interest Interest Institution Securit y Date Cost Date Ela used Maturity Invested Maturit Earned Received Accrued FHLB Coupon Note 11/29/07 2,038,360.00 08/15/12 1706 15 1721 4.170% 397,285.86 389,527.78 7,758.08 KELLS Coupon Note 03/22/12 1,994,833.33 08/24/12 131 24 155 0.610% 4,367.32 4,367.32 GE Corporate Note 01/16/08 1,542,165.00 10/19/12 1658 80 1738 4.587% 321,329.98 335,343.75 (14,013,77) GE. Corporate Note 07/29/10 511,955.00 01/08/13 733 161 894 1.791% 18,413.59 27,183.33 (8,769.74) Treasury Coupon Note 03/31/11 1,997,968.75 03/31/13 488 243 731 (1,8(11% 21,396.77 15,(1(10.01'1 6,396.77 FHLMC Coupon Note 03/25/11 1,016,520.00 04/15/13 494 258 752 0.812% 11,171.36 17,152.78 (5,981.42) NY Life Corporate Note 07/22/11 534,350.00 05/09/13 375 282 657 0.791% 4,342.51 18,535.42 (14,192.91) TIAA Corporate Note 04/11/11 880,446.95 07/15/13 477 349 826 1.334% 15,349.16 50,876.37 (35,527.21) FHLMC Callable Note 01/06/12 2,001,000.00 10/18/13 207 444 651 0.472% 5,356.32 2,833.33 2,522.99 NY Life Coupon Note 01/25/12 2,041,000.00 12/13/13 188 500 688 0.753% 7,915.95 14,183.33 (6,267.38) FHLMC Callable Note 08/18/11 1,005,560.00 08/15/14 348 745 1093 0.860% 8,245.04 5,162.50 3,082.54 PUNIC Coupon Note 09116111 2,026,080.00 08/20/14 319 750 1069 0,527% 9,331.79 8,555.55 776.24 FFCB Callable Note 11/21/11 997,500.00 11/21/14 253 843 1096 0.815% 5,635.06 3,650.00 1,985.06 FFC13 Callable Note 12/19/11 2,000,000.00 12/19/14 225 871 1096 0.750% 9,246.58 7,500.00 1,746.58 FNMA Callable Note 10/31/11 750,000.00 01/26/15 274 909 1183 1.000% 5,630.14 5,520,83 109.31 FNMA Callable Note 10/07/11 1,296,875.00 02/18/15 298 932 1230 0.866% 9,169.37 9,097.22 72.15 FNMA Callable Note 04/23/12 1,513,470.00 04/23/15 99 996 1095 0.946% 3,883.36 3,883.36 Treasury Note 08/16/11 1,042,812.50 07/31/15 350 1095 1445 0.652% 6,519.72 16,739.13 (10,219.41) FHLMC Callable Note 08/24/11 2,000,000.00 08/24/15 342 1119 1461 1.375% 25,767.12 13,750.00 12,017.12 FNMA Callable Note 09/09/11 2,000,000.00 09/09/15 326 1135 1461 1,000% 17,863.01 10,(100.1)0 7,863.01 Berk Hath Coupon Note 01/26/12 1,315,137.50 12/15/15 187 1232 1419 1.077% 7,256.64 11,824.65 (4,568,111) FNMA Callable Note 01/25/12 2,503,906.25 01/25/16 188 1273 1461 1.060% 13,670.64 13,750.00 (79.36) FNMA Callable Note 04/04/12 2,002,500.00 04/04/16 118 1343 1461 1.058% 6,849.32 6,849.32 Treasury Note 08/16/11 1,025,390.63 07/31/16 350 1461 1811 0.973% 9,567,04 14,347.83 (4,780.79) FNMA Callable Note 12/05/11 1,()00,000.00 12/05/16 239 1588 1827 1.000% 6,547.95 5,11O0.()11 1,547.95 FNMA Callable Note 05 /25/12 3,033,660.00 05/03/17 67 1737 1804 1.512% 8,419.78 8,419.78 FHLMC Callable Note 06/08/12 2,007,700.00 06/06/17 53 1771 1824 1.120% 3,265.13 3,265.13 FHLMC Callable Note 06/28/12 2,507,250.00 06/14/17 33 1779 1812 0.139% 315.09 315.09 FNMA Callable Note 06/29/12 2,005,700.00 06/14/17 32 1779 1811 0.800% 1,406.74 1,406.74 Subtotal 46,592,140.91 BNYMM 366,910.86 30 30 0.00% (1,(11:1 0,00 Purchased Interest 6,258.33 LAIF N/A 06/30/12 14,120,718.65 09 /30/12 31 61 92 0.37% 4,351.82 4,351.82 $61,086,028.75 747 0.97% $969,870,12 $995,533,80 ($25,663.68) Maturity Profile Amount Percent 0 -1 year $25,010,486.87 40.94% 1 -2 years $4,042,000,00 6.62% 2 -3 years $10,632,297.50 17.41% 3 -5 years $21,401,244.38 35,03% $61,086,028.75 100.00% Market to Cost Position Report page 5 Amortized Market Unrealized * Source: Treasury and Agency Obligations - Union Bank of California Institution Cost Value* Gain (Loss) LAIF balances per Local Agency Investment Fund monthly statement. BNY Assets $46,592,140.91 $46,530,474.28 (61,666.63) BNYMM 366,910.86 366,910.86 0.00 Purchased Interest 6,258.33 6,258.33 0.00 LAIF 14,120,718.65 14,120,718,65 0.00 Totals: $61,086,028.75 $61,024,362.12 461,666.63 page 5