14 - Investment Report April 2014 Costa Mesa Sanitary District …an Independent Special District Protecting our community’s health and the environment by providing solid waste and sewer collection services. www.cmsdca.gov Memorandum To: Board of Directors Via: Scott Carroll, General Manager From: Marc Davis, Treasurer Date: May 22, 2014 Subject: Investment Report for the Month of April 2014 Summary Attached is the Investment Report for the month of April 2014 . As required by the District’s Statement of Investment Policy, the Investment Report delineates all investment activity during the month. Staff Recommendation That the Board of Directors a pprove s the Investment Report for the month of April 2014 . Analysis This report lists the types of securities held in the District’s portfolio, the institutions from which the securities were purchased, maturity dates and interest rates as of April 30 , 2014 . The District’s investments are in compliance with the Statement of Investment Policy adopted by the Board at the June 27, 2013 regular meeting, as well as the California Government Code. The market values in this report were provided by our third party custodian, Bank of New York, except for the Local Agency Investment Fund (LAIF). The market value of LAIF was provided by the State Treasurer’s Office. It does not represent the value of the underlying securities within the pool, but rather the par or cost amount, which is the amount the District is entitled to withdraw. This reporting practice is consistent with industry standa rd practices for similar funds. ITEM NO. 14
Board of Directors May 22 , 2014 Page 2 of 3 The weighted average stated rate of return (current yield) for the District’s investment portfolio as of April 30 , 2014 , was 0.7 62 %. The yield to mat urity of the portfolio was 0.7 62 %. The District’s weighted average intere st rate was 53 basis points (0.529 %) above the daily effectiv e yield of LAIF, which was 0.2 3 3 % as of April 30 , 2014 . The weighted average number of days to maturity for the District’s total portfolio was 8 2 1 days (2.2 5 years). The average duration of the underlying securities in LAIF as of April 30 , 2014 was 199 days. The District’s investment portfolio is in compliance with its liquidity limitations, which requires that a minimum of 20.00% of the portfolio must mature within one year. The percentage of the portfolio maturing in less than one year as of April 30 , 2014 was 40.83 %. As of April 30 , 2014 , the District has adequate operating reserves necessary to meet its obligations for the next six months. Strategic Plan Element & Goal This item supports achieving Strategic Element No. 7.0, Finances, by ensuring the short and long -term fiscal health of the District. Legal Review Legal review is not required. Financial Review The portfolio was budgeted to earn an average rate of 0.900% for the year ending Ju ne 31 , 201 4 . Through April 30 , 2014 the portfolio has earned a weighted average interest rate of 0.784 %. Interest rates are starting to creep up, so s taff anticipates that the weighted average interest for the portfolio will also increase slightly throughout the remaining portion of the fiscal year , but will fall short of budget estimates . Public Notice Process Copies of this report are on file and will be included with the entire agenda packet for the May 22 , 2014 Board of Directors regular meeting at District Headquarters (6 31 W. 19 th Street) and on the District’s website at www.cmsdca.gov .
Board of Directors May 2 2 , 2014 Page 3 of 3 Alternative Actions 1. Refer the matter back to staff Attachments Treasurer’s Report of Pooled Cash and Investments as of April 30 , 2014
`DepositsOutstanding Bank Balance In Transits Checks Book Balance Active Accounts: Bank of America 3,563,710.13 $ - 3,535.28 3,560,174.85 $ Total Active Accounts3,563,710.13 - 3,535.28 3,560,174.85 Market Value Increase Decrease Cost Investments: Local Agency Investment Fund6,292,569.31 $ - - 6,292,569.31 $ Money Market/Sweep Account1,299,263.36 - - 1,299,263.36 Federal Agency Securities10,878,460.00 - (121,540.00) 11,000,000.00 Total Investments18,470,292.67 - (121,540.00) 18,591,832.67 Total Pooled Cash & Investments22,034,002.80 $ -$ (118,004.72)$ 22,152,007.52 $ Market Adjustment C O S T A M E S A S A N I T A R Y D I S T R I C T Treasurer's Report of Pooled Cash and Investments April 30, 2014 Costa Mesa Sanitary District Pooled Cash and Investments by Fund April 30, 2014 Solid Waste Fund: Operating Reserve 803,000.00 $ Unreserved: Designated for working capital 1,494,000.00 Undesignated 4,605,832.22 Liquid Waste Fund: Operating Reserve 358,000.00 Reserved for Earthquakes/Emergencies 1,000,000.00 Reserved for Capital Outlay 3,442,476.62 Unreserved: Designated for working capital 2,467,300.00 Undesignated 144,750.66 Sewer Construction Fund 100,000.00 Facilities Revolving Fund 314,542.91 Asset Replacement Fund 508,362.16 Asset Management Fund 6,913,742.95 Total Pooled Cash & Investments 22,152,007.52 $ Treasurer Date Marcus D. Davis 5/14/14 1
Total investments outstanding as of March 31, 2014 16,534,412.69 $ Additions:Gain on sale of investment - Investment purchases 1,000,000.00 Deductions:Investments called - Net increase (decrease) in Sweep Account (994,990.19) Net increase (decrease) in LAIF 2,052,410.17 Total investments outstanding as of April 30, 2014 18,591,832.67 $ C O S T A M E S A S A N I T A R Y D I S T R I C T Investment Activity Summary April 30, 2014 2
Interest CUSIP PurchaseMaturityCouponInvestmentEarned at Number Investment Date Date Rate Cost 04/30/14 n/aLocal Agency Investment Fundn/an/a0.233%6,292,56 9.31 $ n/a**n/aBank of New York-Sweep Acctn/an/a0.010%1,299,263 .36 n/a 3134G3ZR4Federal Home Loan Mortgage08/07/1208/07/17 1.000%1,000,000.00 2,333.33 3136G0L58Federal National Mortgage Assn10/18/1210/1 8/171.000%1,000,000.00 361.11 3135G0RQ8Federal National Mortgage Assn11/15/1211/1 5/171.000%1,000,000.00 4,611.11 313381LC7Federal Home Loan Mortgage12/28/1212/28/17 0.950%1,000,000.00 3,245.83 3133823B7Federal Home Loan Mortgage02/22/1302/22/18 1.150%1,000,000.00 2,204.16 3133826D0Federal Home Loan Mortgage02/28/1302/28/18 1.100%1,000,000.00 1,925.00 313382HR7Federal Home Loan Mortgage03/27/1303/27/18 1.130%1,000,000.00 1,067.22 3136G1L31Federal National Mortgage Assn05/15/1305/1 5/170.700%1,000,000.00 3,227.77 3133ECQW7Federal Farm Credit Bank06/04/1306/04/181.250%1,000,000.00 5,104.16 3134G47G7Federal Home Loan Mortgage06/26/1306/26/18 1.400%1,000,000.00 4,861.11 3130A1FS2Federal Home Loan Mortgage04/17/1404/17/19 2.000%1,000,000.00 777.77 Totals 18,591,832.67 $ 29,718.57 $ **Represents the LAIF daily rate at 4/30/14 Comments COSTA MESA SANITARY DISTRICT Investment and Investment Earnings April 30, 2014 3
Current %of Market Value 04/30/14 Maximum %U.S. Treasury Bills0.00%Unlimited U.S. Treasury Notes0.00%Unlimited Federal Agency Issues:FICB 0.00%Unlimited FLB 0.00%Unlimited FHLB 0.00%Unlimited FHLMC 37.51%Unlimited FNMA 16.08%Unlimited FFCB 5.30%Unlimited Other *0.00%Unlimited Banker's Acceptances0.00%25% (1)Certificates of Deposit0.00%25%Negotiable Certificates of Deposits0.00%25% (1)Commercial Paper0.00%25% (1)Medium Term Corporate Notes0.00%20% (1)LAIF (Local Agency Investment Fund)34.07%40,000,000 Shares of Benefical Interest0.00%20%Money Market/Mutual Funds (Sweep Acct)7.03%10% per fund (2)Total 100.00%% of portfolio maturing under one year 40.83%no les s than 20%% of portfolio maturing over one year59.17%100.00%(1) Further limited to 10% in any single issuer (2) Also limited to 20% in total.*These securities are not considered for purchases: SBA, GNMA, TVA and SALLIEMAE COSTA MESA SANITARY DISTRICT Summary of Policy Limitations April 30, 2014 Description 4
PurchaseMaturityCouponInvestment% ofMarket% of Description Broker/Dealer Date Date Rate Cost Portfolio Value Portfolio Comments State Treasurer's PoolLAIFn/aContinuous0.233%**6,29 2,569.31 $ 6,292,569.31 $ POOL Total State Treasurer's Pool 6,292,569.31 33.85%6,292,569.31 34.07%Money Market Mutual FundBank of New Yorkn/aContinuo us0.010%1,299,263.36 1,299,263.36 SWEEP Total Money Market Mutual Fund 1,299,263.36 6.99%1,299,263.36 7.03%Federal Home Loan MortgageE.J. De La Rosa08/07/1208 /07/171.000%1,000,000.00 992,460.00 FHLMC Federal Home Loan MortgageE.J. De La Rosa12/28/1212 /28/170.950%1,000,000.00 985,890.00 FHLMC Federal Home Loan MortgageE.J. De La Rosa02/22/1302 /22/181.150%1,000,000.00 991,950.00 FHLMC Federal Home Loan MortgageE.J. De La Rosa02/28/1302 /28/181.100%1,000,000.00 989,100.00 FHLMC Federal Home Loan MortgageE.J. De La Rosa03/27/1303 /27/181.130%1,000,000.00 982,280.00 FHLMC Federal Home Loan MortgageE.J. De La Rosa06/26/1306 /26/181.400%1,000,000.00 989,250.00 FHLMC Federal Home Loan MortgageE.J. De La Rosa04/17/1404 /17/192.000%1,000,000.00 997,370.00 FHLMC Total Federal Home Loan Mortgage 7,000,000.00 37.65%6,928,300.00 37.51%Federal National Mortgage AssociationE.J. De La Ros a10/18/1210/18/171.000%1,000,000.00 992,420.00 FNMA Federal National Mortgage AssociationE.J. De La Ros a11/15/1211/15/171.000%1,000,000.00 989,250.00 FNMA Federal National Mortgage AssociationUnion Banc05/1 5/1305/15/170.700%1,000,000.00 988,890.00 FNMA Total Federal National Mortgage Association 3,000,000.00 16.14%2,970,560.00 16.08%Federal Farm Credit BankE.J. De La Rosa06/04/1306/0 4/181.250%1,000,000.00 979,600.00 FFCB Total Federal National Mortgage Association 1,000,000.00 5.38%979,600.00 5.30%Total Investments 18,591,832.67 $ 100.00%18,470,292.67 $ 100.00%**Represents the LAIF daily rate at 4/30/14 COSTA MESA SANITARY DISTRICT Schedule of Investments by Instrument Type April 30, 2014 5
InvestmentPurchaseMaturityDays toCouponYield toInve stment Broker/Dealer Type Date Date Maturity Rate Maturity Cost Local Agency Investment FundPool 10.233%**0.233%6,292,569.31 $ Bank of New YorkSweep 10.010%0.010%1,299,263.36 E.J. De La RosaFHLMC08/07/1208/07/171,1951.000%1.00 0%1,000,000.00 E.J. De La RosaFNMA10/18/1210/18/171,2671.000%1.000 %1,000,000.00 E.J. De La RosaFNMA11/15/1211/15/171,2951.000%1.000 %1,000,000.00 E.J. De La RosaFHLMC12/28/1212/28/171,3380.950%0.95 0%1,000,000.00 E.J. De La RosaFHLMC02/22/1302/22/181,3941.150%1.15 0%1,000,000.00 E.J. De La RosaFHLMC02/28/1302/28/181,4001.100%1.10 0%1,000,000.00 E.J. De La RosaFHLMC03/27/1303/27/181,4271.130%1.13 0%1,000,000.00 UnionBancFNMA05/15/1305/15/171,1110.700%0.700%1,000 ,000.00 E.J. De La RosaFFCB06/04/1306/04/181,4961.250%1.250 %1,000,000.00 E.J. De La RosaFHLMC06/26/1306/26/181,5181.400%1.40 0%1,000,000.00 E.J. De La RosaFHLMC04/17/1404/17/191,8132.000%2.00 0%1,000,000.00 Total Investment Portfolio 18,591,832.67 $ Total Portfolio Weighted Avg Interest Rate0.762%Weighted Avg Yield to Maturity0.762%Weighted Avg Days to Maturity821 Days2.25 Years **Represents the LAIF daily rate at 4/30/14 COSTA MESA SANITARY DISTRICT Investment Portfolio April 30, 2014 6
Net PurchaseMaturityIntuitionInvestment CouponInvestme ntMarketAccruedGain/(Loss)Date Date Broker/Dealer Type Par Rate Cost Value Interest If Sold n/aContinuousLAIFPOOL6,292,569.31 $ 0.233%**6,292,569.31 6,292,569.31 - - n/aContinuousBank of New YorkSWEEP1,299,263.36 0.010%1,299,263.36 1,299,263.36 - - 08/07/1208/07/17E.J. De La RosaFHLMC1,000,000.00 1.000%1,000,000.00 992,460.00 2,333.33 (7,540.00) 10/18/1210/18/17E.J. De La RosaFNMA1,000,000.00 1.000%1,000,000.00 992,420.00 361.11 (7,580.00) 11/15/1211/15/17E.J. De La RosaFNMA1,000,000.00 1.000%1,000,000.00 989,250.00 4,611.11 (10,750.00) 12/28/1212/28/17E.J. De La RosaFHLMC1,000,000.00 0.950%1,000,000.00 985,890.00 3,245.83 (14,110.00) 02/22/1302/22/18E.J. De La RosaFHLMC1,000,000.00 1.150%1,000,000.00 991,950.00 2,204.16 (8,050.00) 02/28/1302/28/18E.J. De La RosaFHLMC1,000,000.00 1.100%1,000,000.00 989,100.00 1,925.00 (10,900.00) 03/27/1303/27/18E.J. De La RosaFHLMC1,000,000.00 1.130%1,000,000.00 982,280.00 1,067.22 (17,720.00) 05/15/1305/15/17UnionBancFNMA1,000,000.00 0.700%1,000,000.00 988,890.00 5,104.16 (11,110.00) 06/04/1306/04/18E.J. De La RosaFFCB1,000,000.00 1.250%1,000,000.00 979,600.00 5,104.16 (20,400.00) 06/26/1306/26/18E.J. De La RosaFHLMC1,000,000.00 1.400%1,000,000.00 989,250.00 4,861.11 (10,750.00) 04/17/1404/17/19E.J. De La RosaFHLMC1,000,000.00 2.000%1,000,000.00 997,370.00 777.77 (2,630.00) Total Investments 18,591,832.67 $ 18,591,832.67 18,470,292.67 31,594.96 (121,540.00) **Represents the LAIF daily rate at 4/30/14 C O S T A M E S A S A N I T A R Y D I S T R I C T For all Maturities with Market Values April 30, 2014 7
Type ofPurchaseMaturityCouponInvestment Investment Date Date Rate Par Value Cost FHLMC08/07/1208/07/171.000%1,000,000.00 1,000,000.00 Callable 8/7/14 w/5 days notice, thereafter 1 1,2,5,8 FNMA10/18/1210/18/171.000%1,000,000.00 1,000,000.00 Callable 5/15/13 w/10 days notice, thereafter 8,11,2,5 FNMA11/15/1211/15/171.000%1,000,000.00 1,000,000.00 Callable 5/15/13 w/10 days notice, thereafter 8,11,2,5 FHLMC12/28/1212/28/170.950%1,000,000.00 1,000,000.00 Callable 12/28/13 w/5 days notice, monthly th ereafter FHLMC02/22/1302/22/181.150%1,000,000.00 1,000,000.00 Callable 8/22/13, w/5 days notice, thereafter 8,11,2,5 FHLMC02/28/1302/28/181.100%1,000,000.00 1,000,000.00 Callable 2/28/14, w/5 days notice, annually t hereafter FHLMC03/27/1303/27/181.130%1,000,000.00 1,000,000.00 Callable 3/27/15, w/5 days notice, thereafter 3,6,9,12 FNMA05/15/1305/15/170.700%1,000,000.00 1,000,000.00 Callable 5/15/14 w/10 days notice, qtrly ther eafter FFCB06/04/1306/04/181.250%1,000,000.00 1,000,000.00 Callable 9/4/13 w/5 days notice, anytime ther eafter FHLMC06/26/1306/26/181.400%1,000,000.00 1,000,000.00 Callable 3/26/15 w/5 days notice, thereafter 3,6,9 ,12 Totals 10,000,000.00 $ 10,000,000.00 $ COSTA MESA SANITARY DISTRICT Call Schedule April 30, 2014 Call Features 8
Cost 50,136.76 In Thousands 1 - 180 Days7,591 $ 181 - 365 Days- 1 - 2 Years- ##########6,562.50 2 - 3 Years - COSTA MESA SANITARY DISTRICT MATURITIES DISTRIBUTION April 30, 2014 30%40%50%60%70%40.83%43.03%6,562.50 2 - 3 Years - ##########3 - 4 Years8,000 4 - 5 Years3,000 TOTAL 18,591 $ 0%10%20%30%1 -180 Days 181 -365 Days 1 -2 Years 2 -3 Years 3 -4 Years 4 -5 Years 000000 0.00%0.00%0.00%16.14% 9
Costa Mesa Sanitary District Portfolio Interest Rate Information as of April 30, 2014 0.20%0.40%0.60%0.80%1.00%1.20%1.40%1.60%1.80%2.00%3 month T-Bill 6 month T-Bill 2 year T-Note 3 year T-Note 5 year T-Note CMSD-monthly LAIF-monthly OC Pool-monthly 0.00%10