23 - April 2013 Investment Report 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 23, 2013 Subject: Investment Report for the Month of April 2013 Summary Attached is the Investment Report for the month of April 2013. 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 approves the Investment Report for the month of April 2013. 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 , 2013 . The District’s investments are in compliance with the Statement of Investment Policy adopted by the Board at the July 26, 2012 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 standard practices for similar funds. The weighted average stated rate of return (current yield) for the District’s in vestment portfolio as of April 30 , 2013, was 0.736%. The yield to maturity of the portfolio was 0.73 6 %. The District’s weighted average interest rate was 47 basis points (0.472 %) above the daily effective yield of LAIF, which was 0.264% as of April 27 , 2013 . The weighted ITEM NO. 23
Board of Directors May 23 , 2013 Page 2 of 2 average number of days to maturity for the District’s total portfolio was 1,002 days (2.74 years). The average duration of the underlying securities in LAIF as of April 27 , 2013 , which is the most current information available, was 240 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 3 0 , 2013 was 35.35 %. As of April 30 , 2013, 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 June 30 , 2013. Through April 30 , 2013 , the portfolio has earned a weighted average interest rate of 0.7 84 %. Staff anticipates that the District will fall just short of its estimated investment earnings. Public Notice Process Copies of this report are on file and will be included with the entire agenda packet for the May 23 , 2013 Board of Directors regular meeting at District Headquarters (6 30 W. 19 th Street) and on the District’s website at www.cmsdca.gov . Alternative Actions 1. Refer the matter back to staff Attachment A: Treasurer’s Report of Pooled Cash and Investments as of April 30 , 2013
DepositsOutstanding Bank Balance In Transits Checks Book Balance Active Accounts: Bank of America 3,763,241.93 $ - 201,647.11 3,561,594.82 $ Total Active Accounts 3,763,241.93 - 201,647.11 3,561,594.82 Market Value Increase Decrease Cost Investments: Local Agency Investment Fund4,835,151.99 $ - - 4,835,151.99 $ Money Market/Sweep Account1,179,385.24 - - 1,179,385.24 Federal Agency Securities 11,016,523.75 - 16,523.75 11,000,000.00 Total Investments 17,031,060.98 - 16,523.75 17,014,537.23 Total Pooled Cash & Investments20,794,302.91 $ -$ 218,170.86 $ 20,576,132.05 $ 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, 2013 Costa Mesa Sanitary District Pooled Cash and Investments by Fund April 30, 2013 Solid Waste Fund: Operating Reserve 801,000.00 $ Unreserved 5,989,353.79 Liquid Waste Fund: Operating Reserve 371,000.00 Reserved for Earthquakes/Emergencies 1,000,000.00 Reserved for Capital Outlay 2,774,665.00 Unreserved 3,991,635.38 Sewer Construction Fund 100,000.00 Facilities Revolving Fund 164,172.82 Asset Replacement Fund 244,013.31 Asset Management Fund 5,140,291.75 Total Pooled Cash & Investments 20,576,132.05 $ Treasurer Date Marcus D. Davis April 30, 2013 5/15/13 1 ATTACHMENT A
Total investments outstanding as of March 31, 2013 17,080,811.87 $ Additions:Gain on sale of investment - Investment purchases - Deductions:Investments called - Net increase (decrease) in Sweep Account 5,017.17 Net increase (decrease) in LAIF (71,291.81) Total investments outstanding as of April 30, 2013 17,014,537.23 $ 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, 2013 2 ATTACHMENT A
Interest CUSIP PurchaseMaturityCouponInvestmentEarned at Number Investment Date Date Rate Cost 04/30/13 n/aLocal Agency Investment Fund n/a n/a0.270%4,835,151.99 $ n/a**n/aBank of New York-Sweep Acct n/a n/a0.000%1,179,385.24 n/a 3133EAPB8Federal Farm Credit Bank 05/02/1205/02/171.230%1,000,000.00 6,115.83 3136G0GX3Federal National Mortgage Assn05/30/1208/24/161.000%1,000,000.00 1,861.11 3135G0MA8Federal National Mortgage Assn06/28/1206/28/171.200%1,000,000.00 4,100.00 3134G3ZR4Federal Home Loan Mortgage08/07/1208/07/171.000%1,000,000.00 2,333.33 3136G0L58Federal National Mortgage Assn10/18/1210/18/171.000%1,000,000.00 361.11 3135G0RQ8Federal National Mortgage Assn11/15/1211/15/171.000%1,000,000.00 4,611.11 313381LC7Federal Home Loan Mortgage12/28/1212/28/170.950%1,000,000.00 3,245.83 3136G17A1Federal National Mortgage Assn12/31/1212/30/150.450%1,000,000.00 1,512.50 3133823B7Federal Home Loan Mortgage02/22/1302/22/181.150%1,000,000.00 2,204.16 3133826D0Federal Home Loan Mortgage02/28/1302/28/181.100%1,000,000.00 1,925.00 313382HR7Federal Home Loan Mortgage03/27/1303/27/181.130%1,000,000.00 1,067.22 Totals 17,014,537.23 $ 29,337.20 $ **Represents the LAIF daily rate at 4/30/13 Comments COSTA MESA SANITARY DISTRICT Investment and Investment Earnings April 30, 2013 3 ATTACHMENT A
Current %of Market Value 04/30/13 Maximum %U.S. Treasury Bills 0.00%Unlimited U.S. Treasury Notes 0.00%Unlimited Federal Agency Issues:FICB 0.00%Unlimited FLB 0.00%Unlimited FHLB 0.00%Unlimited FHLMC 29.43%Unlimited FNMA 29.39%Unlimited FFCB 5.87%Unlimited Other *0.00%Unlimited Banker's Acceptances 0.00%25% (1)Certificates of Deposit 0.00%25%Negotiable Certificates of Deposits 0.00%25% (1)Commercial Paper 0.00%25% (1)Medium Term Corporate Notes 0.00%20% (1)LAIF (Local Agency Investment Fund)28.39%40,000,000 Shares of Benefical Interest 0.00%20%Money Market/Mutual Funds (Sweep Acct)6.92%10% per fund (2)Total 100.00%% of portfolio maturing under one year 35.35%no less than 20%% of portfolio maturing over one year 64.65%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, 2013 Description 4 ATTACHMENT A
PurchaseMaturityCouponInvestment% ofMarket% of Description Broker/Dealer Date Date Rate Cost Portfolio Value Portfolio Comments State Treasurer's Pool LAIF n/aContinuous0.270%**4,835,151.99 $ 4,835,151.99 $ POOL Total State Treasurer's Pool 4,835,151.99 28.42%4,835,151.99 28.39%Money Market Mutual Fund Bank of New Yorkn/aContinuous0.000%1,179,385.24 1,179,385.24 SWEEP Total Money Market Mutual Fund 1,179,385.24 6.93%1,179,385.24 6.92%Federal Home Loan Mortgage E.J. De La Rosa08/07/1208/07/171.000%1,000,000.00 1,000,070.00 FHLMC Federal Home Loan Mortgage E.J. De La Rosa12/28/1212/28/170.950%1,000,000.00 1,001,260.00 FHLMC Federal Home Loan Mortgage E.J. De La Rosa02/22/1302/22/181.150%1,000,000.00 1,002,343.75 FHLMC Federal Home Loan Mortgage E.J. De La Rosa02/28/1302/28/181.100%1,000,000.00 1,004,820.00 FHLMC Federal Home Loan Mortgage E.J. De La Rosa03/27/1303/27/181.130%1,000,000.00 1,002,950.00 FHLMC Total Federal Home Loan Mortgage 5,000,000.00 29.39%5,011,443.75 29.43%Federal National Mortgage AssociationUnion Banc 05/30/1208/24/161.000%1,000,000.00 1,000,510.00 FNMA Federal National Mortgage AssociationUnion Banc 06/28/1206/28/171.200%1,000,000.00 999,430.00 FNMA Federal National Mortgage AssociationE.J. De La Rosa10/18/1210/18/171.000%1,000,000.00 1,003,450.00 FNMA Federal National Mortgage AssociationE.J. De La Rosa11/15/1211/15/171.000%1,000,000.00 1,000,380.00 FNMA Federal National Mortgage AssociationUnion Banc 12/31/1212/30/150.450%1,000,000.00 1,001,280.00 FNMA Total Federal National Mortgage Association 5,000,000.00 29.39%5,005,050.00 29.39%Federal Farm Credit Bank E.J. De La Rosa05/02/1205/02/171.230%1,000,000.00 1,000,030.00 FFCB Total Federal Farm Credit Bank 1,000,000.00 5.88%1,000,030.00 5.87%Total Investments 17,014,537.23 $ 100.00%17,031,060.98 $ 100.00%**Represents the LAIF daily rate at 4/30/13 COSTA MESA SANITARY DISTRICT Schedule of Investments by Instrument Type April 30, 2013 5 ATTACHMENT A
InvestmentPurchaseMaturityDays toCouponYield toInvestment Broker/Dealer Type Date Date Maturity Rate Maturity Cost Local Agency Investment FundPool 10.270%**0.270%4,835,151.99 $ Bank of New York Sweep 1 0.000%0.000%1,179,385.24 E.J. De La Rosa FFCB 05/02/1205/02/171,4631.230%1.230%1,000,000.00 UnionBanc FNMA 05/30/1208/24/161,2121.000%1.000%1,000,000.00 UnionBanc FNMA 06/28/1206/28/171,5201.200%1.200%1,000,000.00 E.J. De La Rosa FHLMC08/07/1208/07/171,5601.000%1.000%1,000,000.00 E.J. De La Rosa FNMA 10/18/1210/18/171,6321.000%1.000%1,000,000.00 E.J. De La Rosa FNMA 11/15/1211/15/171,6601.000%1.000%1,000,000.00 E.J. De La Rosa FHLMC12/28/1212/28/171,7030.950%0.950%1,000,000.00 UnionBanc FNMA 12/31/1212/30/159740.450%0.450%1,000,000.00 E.J. De La Rosa FHLMC02/22/1302/22/181,7591.150%1.150%1,000,000.00 E.J. De La Rosa FHLMC02/28/1302/28/181,7651.100%1.100%1,000,000.00 E.J. De La Rosa FHLMC03/27/1303/27/181,7921.130%1.130%1,000,000.00 Total Investment Portfolio 17,014,537.23 $ Total Portfolio Weighted Avg Interest Rate 0.736%Weighted Avg Yield to Maturity 0.736%Weighted Avg Days to Maturity 1,002 Days 2.74 Years **Represents the LAIF daily rate at 4/30/13 COSTA MESA SANITARY DISTRICT Investment Portfolio April 30, 2013 6 ATTACHMENT A
Net PurchaseMaturityIntuitionInvestment CouponInvestmentMarketAccruedGain/(Loss)Date Date Broker/Dealer Type Par Rate Cost Value Interest If Sold n/aContinuousLAIF POOL4,835,151.99 $ 0.270%**4,835,151.99 4,835,151.99 - - n/aContinuousBank of New YorkSWEEP1,179,385.24 0.000%1,179,385.24 1,179,385.24 - - 05/02/1205/02/17E.J. De La RosaFFCB 1,000,000.00 1.230%1,000,000.00 1,000,030.00 6,115.83 30.00 05/30/1708/24/16UnionBanc FNMA1,000,000.00 1.000%1,000,000.00 1,000,510.00 1,861.11 510.00 06/28/1206/28/17UnionBanc FNMA1,000,000.00 1.200%1,000,000.00 999,430.00 4,100.00 (570.00) 08/07/1208/07/17E.J. De La RosaFHLMC1,000,000.00 1.000%1,000,000.00 1,000,070.00 2,333.33 70.00 10/18/1210/18/17E.J. De La RosaFNMA1,000,000.00 1.000%1,000,000.00 1,003,450.00 361.11 3,450.00 11/15/1211/15/17E.J. De La RosaFNMA1,000,000.00 1.000%1,000,000.00 1,000,380.00 4,611.11 380.00 12/28/1212/28/17E.J. De La RosaFHLMC1,000,000.00 0.950%1,000,000.00 1,001,260.00 3,245.83 1,260.00 12/31/1212/30/15UnionBanc FNMA1,000,000.00 0.450%1,000,000.00 1,001,280.00 1,512.50 1,280.00 02/22/1302/22/18E.J. De La RosaFHLMC1,000,000.00 1.150%1,000,000.00 1,002,343.75 2,204.16 2,343.75 02/28/1302/28/18E.J. De La RosaFHLMC1,000,000.00 1.100%1,000,000.00 1,004,820.00 1,925.00 4,820.00 03/27/1303/27/18E.J. De La RosaFHLMC1,000,000.00 1.130%1,000,000.00 1,002,950.00 1,067.22 2,950.00 Total Investments 17,014,537.23 $ 17,014,537.23 17,031,060.98 29,337.20 16,523.75 **Represents the LAIF daily rate at 4/30/13 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, 2013 7 ATTACHMENT A
Type ofPurchaseMaturityCoupon Investment Investment Date Date Rate Par Value Cost FFCB05/02/1205/02/171.230%1,000,000.00 1,000,000.00 Callable 5/2/13 w/5 days notice and anytime after FNMA05/30/1208/24/161.000%1,000,000.00 1,000,000.00 Callable 5/30/13 w/10 days notice, thereafter 8,11,2,5 FNMA06/28/1206/28/171.200%1,000,000.00 1,000,000.00 Callable 6/28/13 w/10 days notice, monthly thereafter FHLMC08/07/1208/07/171.000%1,000,000.00 1,000,000.00 Callable 8/7/14 w/5 days notice, thereafter 11,2,5,8 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 thereafter FNMA12/30/1212/31/150.450%1,000,000.00 1,000,000.00 Callable 12/30/13, w/10 days notice, thereafter 3, 6, 9 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 thereafter 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 Totals 11,000,000.00 $ 11,000,000.00 $ COSTA MESA SANITARY DISTRICT Call Schedule April 30, 2013 Call Features 8 ATTACHMENT A
Cost 50,136.76 In Thousands 1 - 180 Days 6,014 $ 181 - 365 Days - 1 - 2 Years - ##########6,562.50 2 - 3 Years 1,000 COSTA MESA SANITARY DISTRICT MATURITIES DISTRIBUTION April 30, 2013 30%40%50%60%70%35.35%52.90%6,562.50 2 - 3 Years 1,000 ##########3 - 4 Years 1,000 4 - 5 Years 9,000 TOTAL 17,014 $ 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%5.88%5.88% 9 ATTACHMENT A
Costa Mesa Sanitary District Portfolio Interest Rate Information as of April 30, 2013 0.20%0.40%0.60%0.80%1.00%1.20%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 ATTACHMENT A