07 - INVESTMENT REPORTCOSTiq -WEsA S,99UTARTDISTRICT
Memorandum
To: Board of Directors
Via: Scott Carroll, General Manager
From: Marc Davis, Treasurer
Date: August 20, 2012
Item 07
..... an Independent Speciaf Distfict
Subject: Investment Report for the Month of July 2012
Summary
Attached is the Investment Report
District's Statement of Investmen t
investment activity during the month.
Staff Recommendation
for the month of July 2012. As required by the
Policy, the Investment Report delineates all
Approve the Investment Report for the month of July 2012.
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 July 31,
2012. 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.
Board of Directors
August 20, 2012
Page 2 of 3
The weighted average stated rate of return (current yield) for the District's investment
portfolio as of July 31, 2012, was 0.919 %. The yield to maturity of the portfolio was
0.943 %. The District's weighted average interest rate was 56 basis points (0.556 %)
above the daily effective yield of LAIF, which was 0.363% as of July 31, 2012. The
weighted average number of days to maturity for the District's total portfolio was 987
days (2.70 years). The average duration of the underlying securities in LAIF as of July
31, 2012, which is the most current information available, was 243 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 July 31, 2012 was
36.40 %.
As of July 31, 2012, 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 July 31, 2012, the portfolio has earned a weighted average interest
rate of 0.919 %. Staff anticipates that although the average rate is less than the
targeted rate, the District will be close to budget with its estimated investment earnings.
Committee Recommendation
Committee review is not required.
4
Board of Directors
August 20, 2012
Page 3 of 3
Public Notice Process
Copies of this report are on file and will be included with the entire agenda packet for
the August 20, 2012 Board of Directors regular meeting at District Headquarters (628
W. 19th Street) and on the District's website at www.crosdca.gov.
Alternative Actions
1. Refer the matter back to staff
Attachments
Treasurer's Report of Pooled Cash and Investments as of July 31, 2012
3
COSTA MESA SANITARY DISTRICT
Treasurer's Report of Pooled Cash and Investments
July 31, 2012
Costa Mesa Sanitary District
Pooled Cash and Investments by Fund
July 31, 2012
CMSD Solid Waste Activities
$ 5,434,454.30
Deposits Outstanding
5,225,588.84
Sewer Construction Fund
Bank Balance
In Transits Checks
Book Balance
Active Accounts:
343,928.74
Asset Management Fund
5,958,799.17
Bank of America
$ 499,305.18
- 660,009.59
$ (160,704.41)
Total Active Accounts
499,305.18
- 660,009.59
(160,704.41)
Market Adjustment
Market Value
Increase Decrease
Cost
Investments:
Local Agency Investment Fund
$ 5,199,605.30
- -
$ 5,199,605.30
Money Market/Sweep Account
1,096,541.31
- -
1,096,541.31
Federal Agency Securities
11,036,015.00
- 37,565.00
10,998,450.00
Total Investments
17,332,161.61
- 37,565.00
17,294,596.61
Total Pooled Cash & Investments
$ 17,831,466.79
$ - $ 697,574.59
$ 17,133,892.20
Costa Mesa Sanitary District
Pooled Cash and Investments by Fund
July 31, 2012
CMSD Solid Waste Activities
$ 5,434,454.30
CMSD Liquid Waste Activities
5,225,588.84
Sewer Construction Fund
100,000.00
Facilities Revolving Fund
71,121.15
Asset Replacement Fund
343,928.74
Asset Management Fund
5,958,799.17
Total Pooled Cash & Investments $ 17,133,892.20
Marcus D. Davis
Treasurer
8/10/12
Date
COSTA MESA SANITARY DISTRICT
Investment Activity Summary
July 31, 2012
Total investments outstanding as of June 30, 2012
Additions:
Gain on sale of investment
Investment purchases
Deductions:
Investment maturity /sale proceeds
Loss on sale of investment
Investments called
Net increase (decrease) in Sweep Account
Net increase (decrease) in LAIF
Total investments outstanding as of July 31, 2012
2
$ 18,080,250.99
18,991.28
(804,645.66)
$ 17,294,596.61
COSTA MESA SANITARY DISTRICT
Investment and Investment Earnings
July 31, 2012
" *Represents the LAIF daily rate at 7/31/12
3
Comments
Interest
CUSIP
Purchase
Maturity
Coupon
Investment
Earned at
Number
Investment
Date
Date
Rate
Cost
07/31/12 _
n/a
Local Agency Investment Fund
n/a
n/a
0.363%
$ 5,199,605.30
n/a `*
n/a
Bank of New York -Sweep Acct
n/a
n/a
0.000%
1,096,541.31
n/a
3134G2WS7
Federal Home Loan Mortgage
08/23/11
05/23/16
1.540%
999,700.00
2,908.88
3136FR71_1
Federal National Mortgage Assn
09/28/11
09/28/16
1.000%
1,000,000.00
3,416.66
3136FTEB1
Federal National Mortgage Assn
10/26/11
10/26/16
1.500%
1,000,000.00
3,958.33
31331 KV56
Federal Farm Credit Bank
11/23/11
11/23/16
1.500%
1,000,000.00
2,833.33
31331K5G1
Federal Farm Credit Bank
01/04/12
01/04/16
1.120%
1,000,000.00
840.00
3134G3GJ3
Federal Home Loan Mortgage
01/17/12
01/17/17
1.375%
998,750.00
534.72
3134G3HL7
Federal Home Loan Mortgage
01/18/12
07/18/16
1.300%
1,000,000.00
469.44
313378C33
Federal Home Loan Bank
03/07/12
03/07/17
1.240%
1,000,000.00
4,960.00
3133EAPB8
Federal Farm Credit Bank
05/02/12
05/02/17
1.230%
1,000,000.00
3,040.83
3136GOGX3
Federal National Mortgage Assn
05/30/12
08/24/16
1.000%
1,000,000.00
1,861.11
3135GOMA8
Federal National Mortgage Assn
06/28/12
06/28/17
1.200%
1,000,000.00
1,100.00
Totals
$ 17,294,596.61
$ 25,923.30
" *Represents the LAIF daily rate at 7/31/12
3
Comments
COSTA MESA SANITARY DISTRICT
Summary of Policy Limitations
July 31, 2012
Description
U.S. Treasury Bills
U.S. Treasury Notes
Federal Agency Issues:
FICB
FLB
FHLB
FHLMC
FNMA
FFCB
Other
Banker's Acceptances
Certificates of Deposit
Negotiable Certificates of Deposits
Commercial Paper
Medium Term Corporate Notes
LAIF (Local Agency Investment Fund)
Shares of Benefical Interest
Money Market/Mutual Funds (Sweep Acct)
Total
% of portfolio maturing under one year
% of portfolio maturing over one year
Current %
of Market Value
07/31/12
0.00%
0.00%
0.00%
0.00%
5.78%
17.38%
23.15%
17.36%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
30.00%
0.00%
6.33%
100.00%
36.40%
63.60%
100.00%
Maximum %
Unlimited
Unlimited
Unlimited
Unlimited
Unlimited
Unlimited
Unlimited
Unlimited
Unlimited
25%(1)
25%
25%(1)
25%(1)
20%(1)
40,000,000
20%
10% per fund (2)
no less than 20%
(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
4
Description Broker /Dealer
State Treasurer's Pool LAIF
Total State Treasurer's Pool
COSTA MESA SANITARY DISTRICT
Schedule of Investments by Instrument Type
July 31, 2012
Purchase Maturity Coupon Investment % of Market % of
Date Date Rate Cost Portfolio Value Portfolio Comments
n/a Continuous 0.363% $ 5,199,605.30 $ 5,199,605.30 POOL
Money Market Mutual Fund Bank of New York n/a
Total Money Market Mutual Fund
Federal Home Loan Bank E.J. De La Rosa 03/07/12
Total Federal Home Loan Bank
Federal Home Loan Mortgage
Union Banc
08/23/11
Federal Home Loan Mortgage
Union Banc
01/17/12
Federal Home Loan Mortgage
Union Banc
01/18/12
Total Federal Home Loan Mortgage
1,096,541.31
6.33%
Federal National Mortgage Association
E.J. De La Rosa
09/28/11
Federal National Mortgage Association
E.J. De La Rosa
10/26/11
Federal National Mortgage Association
Union Banc
05/30/12
Federal National Mortgage Association
Union Banc
06/28/12
Total Federal National Mortgage Association
Federal Farm Credit Bank E.J. De La Rosa 11/23/11
Federal Farm Credit Bank Union Banc 01/04/12
Federal Farm Credit Bank E.J. De La Rosa 05/02/12
Total Federal Farm Credit Bank
Total Investments
"Represents the LAIF daily rate at 7/31/12
5,199,605.30 30.06% 5,199,605.30 30.00%
Continuous
0.000%
1,096,541.31
1,096,541.31
1,096,541.31
6.34%
1,096,541.31
6.33%
03/07/17
1.240%
1,000,000.00
1,001,010.00
1,000,000.00
5.78%
1,001,010.00
5.78%
05/23/16
1.540%
999,700.00
1,003,550.00
01/17/17
1.375%
998,750.00
1,004,930.00
07/18/16
1.300%
1,000,000.00
1,004,375.00
2,998,450.00
17.34%
3,012,855.00
17.38%
09/28/16
1.000%
1,000,000.00
1,001,060.00
10/26/16
1.500%
1,000,000.00
1,002,800.00
08/24/16
1.000%
1,000,000.00
1,004,200.00
06/28/17
1.200%
1,000,000.00
1,004,720.00
4,000,000.00
23.13%
4,012,780.00
23.15%
11/23/16
1.500%
1,000,000.00
1,001,810.00
01/04/16
1.120%
1,000,000.00
1,003,260.00
05/02/17
1.230%
1,000,000.00
1,004,300.00
3,000,000.00
17.35%
3,009,370.00
17.36%
5
$ 17,294,596.61 100.00% $ 17,332,161.61 100.00%
SWEEP
FHLB
FHLMC
FHLMC
FHLMC
FNMA
FNMA
FNMA
FNMA
FFCB
FFCB
FFCB
Broker /Dealer
Local Agency Investment Fund
Bank of New York
UnionBanc
E.J. De La Rosa
E.J. De La Rosa
E.J. De La Rosa
UnionBanc
UnionBanc
UnionBanc
E.J. De La Rosa
E.J. De La Rosa
UnionBanc
UnionBanc
Total Investment Portfolio
Total Portfolio
Weighted Avg Interest Rate
Weighted Avg Yield to Maturity
Weighted Avg Days to Maturity
COSTA MESA SANITARY DISTRICT
Investment Portfolio
July 31, 2012
Investment
Purchase
Maturity
Days to
Coupon
Yield to
Type
Date
Date
Maturity
Rate
Maturity
Pool
1
0.363% "*
0.363%
Sweep
1
0.000%
0.000%
FHLM
08/23/11
05/23/16
1,392
1.540%
1.540%
FNMA
09/28/11
09/28/16
1,520
1.000%
1.390%
FNMA
10/26/11
10/26/16
1,548
1.500%
1.500%
FFCB
11/23/11
11/23/16
1,576
1.500%
1.500%
FFCB
01/04/12
01/04/16
1,252
1.120%
1.120%
FHLM
01/17/12
01/17/17
1,631
1.375%
1.401%
FHLM
01/18/12
07/18/16
1,448
1.300%
1.300%
FHLB
03/07/12
03/07/17
1,680
1.240%
1.240%
FFCB
05/02/12
05/02/17
1,736
1.230%
1.230%
FNMA
05/30/12
08/24/16
1,485
1.000%
1.000%
FNMA
06/28/12
06/28/17
1,793
1.200%
1.200%
"Represents the LAIF daily rate at 7/31/12
0.919%
0.943%
987 Days 2.70 Years
A
Investment
Cost
$ 5,199,605.30
1,096,541.31
999,700.00
1,000,000.00
1,000,000.00
1,000,000.00
1,000,000.00
998,750.00
1,000,000.00
1,000,000.00
1,000,000.00
1,000,000.00
1,000,000.00
$ 17,294,596.61
COSTA MESA SANITARY DISTRICT
For all Maturities with Market Values
July 31, 2012
"Represents the LAIF daily rate at 7/31/12
7
Net
Purchase
Maturity
Intuition
Investment
Coupon
Investment
Market
Accrued
Gain /(Loss)
Date
Date
Broker /Dealer
Type
Par
Rate
Cost
Value
Interest
If Sold
n/a
Continuous
LAIF
POOL
$ 5,199,605.30
0.363% ""
5,199,605.30
5,199,605.30
-
-
n/a
Continuous
Bank of New York
SWEEP
1,096,541.31
0.000%
1,096,541.31
1,096,541.31
-
-
08/23/11
05/23/11
UnionBanc
FHLM
1,000,000.00
2.000%
999,700.00
1,003,550.00
2,908.88
3,850.00
09/28/11
09/28/16
E.J. De La Rosa
FNMA
1,000,000.00
1.000%
1,000,000.00
1,001,060.00
3,416.66
1,060.00
10/26/11
10/26/16
E.J. De La Rosa
FNMA
1,000,000.00
1.500%
1,000,000.00
1,002,800.00
3,958.33
2,800.00
11/23/11
11/23/16
E.J. De La Rosa
FFCB
1,000,000.00
1.500%
1,000,000.00
1,001,810.00
2,833.33
1,810.00
01/04/12
01/04/16
UnionBanc
FFCB
1,000,000.00
1.120%
1,000,000.00
1,003,260.00
840.00
3,260.00
01/17/12
01/17/17
UnionBanc
FHLM
1,000,000.00
1.375%
998,750.00
1,004,930.00
534.72
6,180.00
01/18/12
07/18/16
UnionBanc
FHLM
1,000,000.00
1.300%
1,000,000.00
1,004,375.00
469.44
4,375.00
03/07/12
03/07/17
E.J. De La Rosa
FHLB
1,000,000.00
1.240%
1,000,000.00
1,001,010.00
4,960.00
1,010.00
05/02/12
05/02/17
E.J. De La Rosa
FFCB
1,000,000.00
1.230%
1,000,000.00
1,004,300.00
3,040.83
4,300.00
05/30/17
08/24/16
UnionBanc
FNMA
1,000,000.00
1.000%
1,000,000.00
1,004,200.00
1,861.11
4,200.00
06/28/12
06/28/17
FNMA
1,000,000.00
1.200%
1,000,000.00
1,004,720.00
1,100.00
4,720.00
Total Investments
$ 17,296,146.61
17,294,596.61
17,332,161.61
25,923.30
37,565.00
"Represents the LAIF daily rate at 7/31/12
7
Type of Purchase Maturity Coupon
Investment
Date
Date
Rate
FHLMC
08/23/11
05/23/11
1.540%
FNMA
09/28/11
09/28/16
1.000%
FNMA
10/26/11
10/26/16
1.500%
FFCB
11/23/11
11/23/11
1.500%
FFCB
01/04/12
01/04/16
1.120%
FHLMC
01/17/12
01/17/17
1.375%
FHLMC
01/18/12
07/18/16
1.300%
FHLB
03/07/12
03/07/17
1.240%
FFCB
05/02/12
05/02/17
1.230%
FNMA
05/30/12
08/24/16
1.000%
FNMA
06/28/12
06/28/17
1.200%
COSTA MESA SANITARY DISTRICT
Call Schedule
July 31, 2012
Par Value
$ 1,000,000.00
1,000,000.00
1,000,000.00
1,000,000.00
1,000,000.00
1,000,000.00
1,000,000.00
1,000,000.00
1,000,000.00
1,000,000.00
1,000,000.00
Investment
Cost
$ 999,700.00
1,000,000.00
1,000,000.00
1,000,000.00
1,000,000.00
998,750.00
1,000,000.00
1,000,000.00
1,000,000.00
1,000,000.00
1,000,000.00
Totals $ 11,000,000.00 $ 10,998,450.00
Call Features
Callable 11 /23/12 w/5 days notice
Callable 9/28/12 w /10 days notice, thereafter 9,12,3,6
Callable 10/26/12 w /10 days notice.
Callable 11/23/12 w/5 days notice and anytime after
Callable 1/4/13 w/5 days notice and anytime after
Callable 1/17/13 w/5 days notice, thereafter 4,7,10,1
Callable 1/18/13 w/5 days notice, thereafter 4,7,10,1
Callable 3/7/13 w/5 days notice thereafter 3,6,9,12
Callable 5/2/13 w/5 days notice and anytime after
Callable 5/30/13 w /10 days notice, thereafter 8,11,2,5
Callable 6/28/13 w /10 days notice, monthly thereafter
I
COSTA MESA SANITARY DISTRICT
MATURITIES DISTRIBUTION
July 31, 2012
70%
--------------------------------------------------------------
-----------------------------------------------
Cost
60%
- - - -__
52.03 °io
In Thousands
------------------------------------------------
- - - - -- -- 1 - 180 Days
$ 6,296
50%
-----------------------------------------------
181 - 365 Days
-
° °
36.40%
- - - - -- --
1 - 2 Years
-
30%
-- ------------------- --- ---------
------ ---- - -- - --- --
2 - 3 Years
-
-- --------------------------------------
---- --- - -- -- 3 - 4 Years
2,000
20%
11.56%
-- - - - - - -- --- -- -00%
4 - 5 Years
- -- - - -- - - - -- --
8,999
10%
0.00%
o.00 °i°
0.00
.00%
o.00% TOTAL
$ 17,295
0 0 0
0 0 0
0%i°
1 -180 181 -365 1-2
2 -3 3 -4 4 -5
Days Days Years
Years Years Years
I
1.60%
1.40%
1.20%
1.00%
0.80%
0.60%
0.40%
0.20%
0.00%
^ \LO ��° ° �° ° ° \�O ° ° y° yo 1° ry° t° ry° ,p° 1,° ,yO ,p yO ryO 10 yo ryO
Costa Mesa Sanitary District
Portfolio Interest Rate Information
as of July 31, 2012
10
-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