STAFF REPORT
City of Lancaster
CC 4
2/13/2024
JC
Date:February 13, 2024
To: Mayor Parris and City Council Members
From:George N. Harris II
Subject:Monthly Reports of Investments - November & December 2023.
Recommendation:
Accept and approve the submitted November and December 2023 Monthly Report of Investments.
Fiscal Impact:
None.
Background:
Each month, the Finance Department prepares a report listing the investments for all separate entities under the jurisdiction of the City as identified in the City’s Comprehensive Annual Financial Report.
Portfolio Recap
Yield:
November November 2023 October 2023
Total Portfolio 3.46% 3.44%
Cal CLASS 5.51% 5.51%
Local Agency Investment Fund 3.59% 3.59%
Total Pooled Portfolio Balance: $127,051,629 $130,528,341 The portfolio balance decreased from October to November by $3,476,712 or 2.66%. Significant Revenues for November include $2,352,491 in Sales and use Tax and $2,245,698 in Measure LC Sales Tax. Expenses include $3,945,673 for Miscellaneous, $939,275 for Debt Service, and $4,704,003 for Payroll & Benefits.
December December 2023 November 2023
1 5
2 3
Total Portfolio 3.25% 3.46%
Cal CLASS 5.51% 5.51%
Local Agency Investment Fund 3.59% 3.59%
Total Pooled Portfolio Balance: $135,919,759 $127,051,629 The portfolio balance increased from November to December by $8,868,130 or 6.98%.
Significant Revenues for December include $2,391,697 in Sales and Use Tax and $1,456,954 in Measure LC Sales Tax. Expenses include $1,611,045 for Miscellaneous and $3,347,816 for Payroll & Benefits.
The City’s temporary idle cash, those funds not immediately needed to pay current bills and not governed by bond indentures or bond resolutions, is invested by the City’s adopted Investment Policy. The City Council reviewed this policy regularly, with the latest policy adopted on February 13, 2018, by Resolution No. 18-06.
The City's cash management system is designed to accurately monitor and forecast expenditures and revenues, thus enabling the City to invest funds to the fullest extent possible within the guidelines of this Investment Policy. The City attempts to achieve the highest yield obtainable through a diversified portfolio only after meeting the criteria established for safety and liquidity in that order. The principal investment objectives of the City are:
1. Preservation of capital and protection of investment principal;
2. Maintenance of sufficient liquidity to meet anticipated cash flows;
3. Attainment of a market rate of return;
4. Diversification to avoid incurring unreasonable market risks and
5. Compliance with the City’s Municipal Code and all applicable City resolutions, California statutes, and Federal regulations.
The City’s portfolio is a short-term and intermediate-term fixed-income portfolio. The maximum maturity of any investment is 5 years, with consideration of anticipated cash flow requirements and known future liabilities. The City contracts with an investment advisory service (Insight Investment) to assist in the effort to maximize the returns of the City portfolio. The City’s investments include publicly traded Treasury notes, Treasury Bills, Federal Agency Investments, Time Deposits, and Local Agency Investment Fund (LAIF) under the auspices of the State Treasurer for investment. Funds invested in LAIF are available within 24 hours, and other investments are available upon maturity at full face value. These investments enable the City to meet its expenditure requirements for the next six months, as required by state law.
The City’s investment procedures are governed by Sections 53600 et. seq. of the California Government Code. Additional requirements have been placed on the City’s authorized investments by the Investment Policy (a copy is available in the Finance Department or from the City Clerk), and all investments listed on the attached report adhere to these requirements.
Attachment:
A. November & December Treasurer’s Report
B. November & December Investment Report