West Sacramento City Council
June 7, 2023

Alternatives

1. The Council may choose not to object to the owner’s request to remove the conditions regarding single sale beverages for Kwik Mart.

2. The Council may choose to modify the conditions regarding single sale beverages for Kwik Mart.

Coordination and Review
This report was coordinated and reviewed by the Police Department and Community Development Department.

Budget/Cost Impact
There is no budgetary or cost impact associated with this item.

ATTACHMENTS

1. Letter to ABC regarding Kwik Mart

2. ABC Notification re: Kwik Mart Petition for Condition Removal

3. Calls for Service
306
1110 West Capitol Avenue
West Sacramento, CA 95691
(916) 617-4500
www.cityofwestsacramento.org
Attachment 1
June 7, 2023
Maggie DeSouza
ABC Licensing Representative II
Alcohol Beverage Control
2400 Del Paso Road, Suite 155
Sacramento, CA 95834
Subject: Objection to Petition for ABC License Condition Removal/Modification – Kwik Mart Dear Ms. DeSouza
On May 9, 2023, the Police Department received a petition from the ABC license-holder for the Kwik Mart, located at 1648 West Capitol Avenue, to remove the condition on its license prohibiting the sale of certain alcoholic beverages (e.g., beer in containers of 16 oz or less, wine coolers, pre-mixed cocktails) in quantities of fewer than three individual containers per sale. At its regular meeting on June 7, 2023, the City Council reviewed the petition, along with information from the Police Department supporting a determination that the grounds that caused the condition to be imposed on the license continue to exist. In particular, Kwik Mart is located in an area of concentrated criminal activity along West Capitol Ave in West Sacramento. The location of the business has generated 15 calls for service in the past 12 months, including public nuisance, suspicious subject and harassment, and the area directly around the business has generated over 300 calls for service in the same 12-month period.

The types of calls in the area include armed robbery, driving under the influence, drunk in public, trespassing, battery and indecent exposure. The crime rate and activity in the area remains consistent, illustrating that there are no grounds to remove the single sales condition.

Moreover, the license holder has not presented any information supporting a determination that the grounds that caused the imposition of the condition no longer exist, so it has not satisfied its burden under Section 23803 of the Business and Professions Code in requesting removal of the condition.

As such, the City Council, as the local governing body for the City of West Sacramento, pursuant to Section 23803 of the Business and Professions Code, objects to the removal of the condition on the license for Kwik Mart which would allow sales of single beer and other alcoholic beverages and requests the ABC reject the petition to remove the condition.

Should you have any questions, please contact Dea Pugh at (916) 617-4967.

Sincerely,
Martha Guerrero
Mayor
307
1110 West Capitol Avenue
West Sacramento, CA 95691
(916) 617-4500
www.cityofwestsacramento.org
Attachment 1
cc: Rob Strange, Police Chief, West Sacramento Police
308
309
310
311
312
313
KWIK MART (1648 WEST CAPITOL AVENUE)
May 30, 2022 – May 30, 2023
During the last 12 months there were 1,557 calls for service on West Capitol Avenue in the concentrated area shown below in red. Of those calls for service, 44% of the top 20 problem types are public nuisance related, which are often exacerbated by alcohol. These call types include 5150 Psych Patient, Trespassing, Fights, Thefts, and Homeless Complaints. In this same area are four different residential units, all within walking distance (~800 feet) of Kwik Mart.

Call Type Total
MED Medical Aid 192
970 Follow Up 139
5150 Psych Patient 117
602 Trespassing 94
INFO Information for law 93
T Traffic Stop 60
W911A WIRELESS abandoned 911 59
415V Fight - Verbal 53
11-20 Parking Violation 42
980 Welfare Check 34
415T Disturbance - Threats 28
415P Fight - Physical 28
R10851 Stolen Vehicle Report 27
R484 Theft Report 26
SCIRS Suspicious Subject 24
370H Homeless complaint 22
W980 Welfare Chk WIRELESS 20
10-33C Audible Commercial 19
R242 Battery Report 18
903 Assist Outside Agency 18
Total 1113
314
Address Business Name Total CFS
1801 W Capitol Ave Mercy Housing 715
1601 W Capitol Ave Raley's 330
1700 W Capitol Ave McDonalds 90
1705 W Capitol Ave Sinclair Gas 65
1731 W Capitol Ave Mercy Housing 65
1721 W Capitol Ave Cheap Cigarettes 62
1724 W Capitol Ave Sahara Motel 43
1550 W Capitol Ave Fremont Motel 38
1600 W Capitol Ave Bel Air Motel 33
1750 W Capitol Ave Uhaul 32
1640 W Capitol Ave Capitol Gyros 24
812 Westacre Rd Kentucky Fried Chicken 24
1648 W Capitol Ave KWIK 13
1620 W Capitol Ave Water & Salt 6
1725 W Capitol Ave Mercy Housing 4
1638 W Capitol Ave Ariana Market 3
1627 W Capitol Ave N/A 2
1701-1799 W Capitol Ave N/A 2
820 Westacre Rd Acme Dental 2
1629 W Capitol Ave Raley's 1
1699 W Capitol Ave N/A 1
1700-1798 W Capitol Ave N/A 1
1701 W Capitol Ave N/A 1
Total Calls for Service 1,557
315

CITY COUNCIL AGENDA REPORT
MEETING DATE: June 7, 2023 ITEM # 12
SUBJECT:

CONSIDERATION OF PURCHASE OF A VARIABLE FREQUENCY DRIVE AT BRIDGEWAY LAKES PUMP STATION USING CIP 21007 (MAJOR WATER SYSTEMS

REPAIRS)
INITIATED OR REQUESTED BY: REPORT COORDINATED OR PREPARED BY:
[ ] Council [X] Staff
[ ] Other
Lorianne Landsaw
Public Works Department
ATTACHMENT [X] Yes [ ] No [ ] Information [ ] Direction [X] Action

OBJECTIVE
The objective of this report is to request Council approval to purchase a Variable Frequency Drive (VFD) for a High Service Pump (HSP) at the Bridgeway Lakes pump station.

RECOMMENDED ACTION
Staff respectfully recommends that the City Council:
1) Find that the purchase, removal and replacement of a variable frequency drive is exempt from the California Environmental Quality Act (CEQA) under the General Rule exemption provided for in the CEQA Guidelines Section § 15061(b)(3); and
2) Authorize the use of CIP 21007 for Major Water System Repairs in the amount of $70,000 for the removal and replacement of the variable frequency drive for a high service pump at the Bridgeway Lakes Pump Station.

BACKGROUND
The George Kristoff Water Treatment Plant (WTP) currently has a nominal treatment capacity of 58 million gallons per day (mgd), provides full conventional treatment, and is the only source of drinking water supply for the City of West Sacramento. The treatment plant is operated 24 hours per day, 365 days per year. The City utilizes pump stations to help transport potable water to its citizens and to maintain water pressure through the system. The Bridgeway Lakes Pump Station is designed to rotate through three variable frequency drives (VFD’s) on a weekly basis. This is one of only two pump stations that provide water to the south side of the City.

At this time, only one of the three VFD’s is currently operational, supporting the continued water supply on the north side of the City, as well as maintaining water pressure necessary for fire suppression efforts.

ANALYSIS
The majority of VFD’s used in the water treatment process are older and are at, or close to, the end of their useful life. To rectify this, staff has requested a multi-year replacement project in the CIP for fiscal years 2023/2024 and 2024/2025 which is anticipated to be approved by Council on June 28, 2023 with the full biennial budget.

However, staff is requesting that a VFD repair for this specific pump station be approved immediately, to allow staff to order the VFD and have it installed using funds from the Major Water Systems Repair CIP (21007) to complete the transaction. This project has sufficient budget to perform the work and was created for this type of transaction when a major water system repair is required for which a separate CIP has not been created. Staff issued an Invitation to Bid (23-028-ITB) on April 17, 2023 and had one approved response. The response is from an existing vendor who understands the needs of the City and the Water Treatment Plant, and staff recommended acceptance of this bid. As the purchase of the part is in excess of $50,000, Council approval of the purchase is required.

Environmental Considerations
This action is not a project that is subject to CEQA because it is not an activity that may cause either a direct or reasonably foreseeable indirect physical change in the environment. (Pub. Resources Code, § 21065; CEQA Guidelines §§ 15060(c), 15378(a).)
Commission Recommendation
Not applicable
316
Variable Frequency Drive Replacement
June 7, 2023

Strategic Plan Integration
This supports the City’s vision and goal for a “West Sacramento: Preferred Place to Live, Work, Learn and Play.” Alternatives
The City Council may decide to:
1) Approve the recommended action; or
2) Direct staff to wait until the proposed CIP for the new budget years is approved.

Alternative 2 is not recommended due to the limited capacity and potential issues which would be experienced if the one remaining VFD were to experience a failure prior to the start of the new fiscal year.

Coordination and Review
This report has been coordinated with the Capital Projects Department and the Finance Department.

Budget/Cost Impact
CIP 21007 currently has sufficient funds available to cover the cost of this replacement.

ATTACHMENT
None
317

CITY COUNCIL AGENDA REPORT
MEETING DATE: June 7, 2023 ITEM # 13
SUBJECT:

CONSIDERATION OF THE TREASURER’S QUARTERLY FINANCIAL REPORT ON THE CITY’S INVESTMENT PORTFOLIO FOR THE PERIOD ENDING MARCH 31, 2023 AND ANNUAL UPDATES TO THE CITY’S INVESTMENT POLICY
INITIATED OR REQUESTED BY: REPORT COORDINATED OR PREPARED BY:
[ ] Council [X] Staff
[ ] Other
Marc Rotteveel, Finance Analyst
Finance Department
ATTACHMENT [X] Yes [ ] No [ ] Information [ ] Direction [X] Action

OBJECTIVE
The purpose of this report is to provide the City Council with the treasurer’s quarterly report on the City’s investment portfolio for the quarter ending March 31, 2023 as outlined by the Government Code 53646(b) (1) and to propose updates to the City’s Investment Policy consistent with applicable Government Code.

RECOMMENDED ACTION
Staff respectfully recommends that the City Council receive and file the Treasurer’s Quarterly Financial Report on the City’s investment portfolio for the period ending March 31, 2023, and approve the recommended changes to the City’s investment policy.

BACKGROUND
All local agencies are required to file regular financial reports with their legislative body on the status of their investment portfolio. One of the roles of the City’s Finance Department is to manage investments of the City to ensure that cash flow needs are met while maximizing the investment portfolio.

The funds invested in the City’s treasury are made up of pooled cash from all Funds in the City’s general ledger, including funds held in Trust for other agencies (i.e., the Yolo-Sacramento Port District and West Sacramento Flood Control Agency (WSAFCA) JPA). City staff structure investment maturities in such a way to optimize return while ensuring enough liquid funds are available to meet the operating and capital needs of the City and agencies for which the City acts as Treasurer. The pooled cash also includes impact fee revenues collected from developers and set aside until sufficient funds are available to implement the capital projects for which they were collected, and reserve funds for budget stabilization to ensure fiscal stability of the City and its various services to the community.

It should be noted that the majority of the funds held in the City’s treasury are legally restricted and may only be used for the purposes for which they are collected. Moreover, the funds may only be invested in investments permitted by California Government Code 53600 (Code) et. al, and the City’s investment policy.

Under section 53646(b)(1) of the Government Code, the City Treasurer may prepare and transmit a quarterly financial report to the City Council on the City’s investment portfolio. This report includes:

1. The type of investment, issuer, date of maturity, and par and dollar amount invested on all securities, investments and funds held by the City;

2. A current market value as of the date of the report;

3. A stated compliance of the portfolio to the statement of the City’s adopted investment policy, or manner in which the portfolio is not in compliance; and

4. A statement denoting the ability of the local agency to meet its pool’s expenditure requirements for the next six months, or provide an explanation as to why sufficient money shall or may not be available. Once a year, the statement of investment policy is included in the report.

This quarterly report is produced in a format designed to provide stakeholders with a broad profile of the City’s Investment Portfolio. While staff is only transmitting portions of the report with key investment results, a full report with additional detail is available upon request.
318
Quarterly Treasurer’s Report
June 7, 2023

ANALYSIS
This quarterly financial report summarizes the status of pooled treasury investments as of March 31, 2023. For the quarter-end, the City’s treasury investments comprised investments with a book value of $275,574,350.63, and a market value of $270,767,237.38. These figures do not include accrued interest of $1,214,391.30, which represents interest income the City has earned but not yet received. The Book Value represents the carrying value of the securities and is based on what the City paid for the security, net of amortization of premiums or accretion of discounts to date, whereas Market Value is a constantly changing amount based on how the securities markets value our portfolio. Market values fluctuate with changes in interest rates, and price has an inverse relationship to interest rates.

The City continues to maintain sufficient liquidity to meet its expenditure requirements for the next six months.

Local Agency Investment Fund (LAIF), which is the California State Treasurer’s investment pool, and California Asset Management Program (CAMP), a local government investment pool, comprised the City’s most liquid funds, and totaled 37.29% of the investment portfolio. These funds are available to the City within one day.

Additionally, the City held $42.2 million in its operating bank account, which fluctuates depending on cash needs to meet City obligations. Those funds not held in the short-duration investment pools or cash are invested in a diversified portfolio of securities as allowed by Code and the City’s investment policy. The portfolio’s duration, sector allocation, and maturity structure are actively managed throughout the quarter. In total, the City’s consolidated investments maintain an average maturity of 352 days.

The City’s portfolio is designed to provide safety and liquidity and continues to meet its goals. City staff and the City’s investment adviser continue to focus on any market dynamics that pose risks to the portfolio.

55.0%

0.1% 1.7%

13.2% 12.3%

8.5% 9.3%

52.7%

0.0% 1.4%

11.4%

17.9%

8.0% 8.5%
0%
10%
20%
30%
40%
50%
60%
70%
0-0.25 0.25-0.50 0.50-1 1-2 2-3 3-4 4-5
3/31/2023 12/31/2022
City of West Sacramento Consolidated Maturity Distribution 319
Quarterly Treasurer’s Report
June 7, 2023

City of West Sacramento Consolidated Sector Allocation
The City’s portfolio of securities (excluding cash, LAIF, and CAMP) maintains its duration in line with its performance-measuring benchmark. Duration is a risk measure indicating the portfolio’s fair value sensitivity to changes in interest rates. As of March 31, 2023, portfolio duration was 2.34 years, which is 96% of its duration target, as measured by the portfolio’s risk and performance-measuring benchmark (which had a duration of 2.48 years). The portfolio continues to maintain strong diversification in sectors, issuers, and maturities.

Economic Outlook
Economic trends have been decelerating along with tighter financial conditions and restrictive monetary policy.

Recent data suggests positive but below trend growth this year. Although the pace of job growth is moderating, labor markets remain solid, and the U.S. consumer has demonstrated resiliency. Market participants and the Federal Reserve are maintaining very divergent views regarding the future trajectory of monetary policy. Given the cumulative effects of tighter monetary policy and stress in the banking sector, the Federal Reserve is likely near a pause in their rate hiking campaign. If moderate growth continues, the Fed may likely maintain the Federal Funds rate in restrictive territory until inflationary pressures subside.

At the March meeting, the Federal Open Market Committee voted unanimously to raise the target federal funds rate by 0.25% to a range of 4.75 – 5.00%. Fed Chair Powell reiterated the committee’s focus on bringing down inflation to their 2% target; however, the committee softened language about "ongoing increases" in rates in the prior statement to "some additional policy firming may be appropriate". The statement also emphasized that the U.S. banking system is “sound and resilient” and acknowledged the tightening of financial conditions.

In March, the yield curve inversion narrowed. The 2-year Treasury yield plummeted 79 basis points to 4.03%, the 5-year Treasury yield plunged 61 basis points to 3.58%, and the 10-year Treasury yield fell 45 basis points to 3.47%. The inversion between the 2-year Treasury yield and 10-year Treasury yield declined to -56 basis points at March month-end versus -90 basis points at February month-end. There was no spread between the 2-year Treasury and 10-year Treasury yield one year ago – the yields were approximately equal. The inversion between 3-month and 10-year Treasuries widened to -128 in March from -89 basis points in February. The shape of the yield curve indicates that the probability of recession is increasing.

Discussion of Performance
The following is a summary of the City’s holdings by investment type, including each sector’s yield to maturity.

Yield to maturity measures the interest income the City is expected to earn for the coming 12 months, assuming nothing in the portfolio changes. As of March 31, 2023, the weighted average yield to maturity of the City’s consolidated investments was 2.23%:

March 31, 2023 December 31, 2022
ABS

4.8% Agency

8.4%
Cash

15.6%
CMO

3.6%
Corporate

11.8%
LAIF

37.3%
Local Gov
Investment
Pool

1.9%
Municipal
Bonds

0.3%
Negotiable CD

0.1%
US Treasury

14.6%
Supranational

1.5%
Money Market
Fund

0.2%
320
Quarterly Treasurer’s Report
June 7, 2023

Investment Type Par Value Market Value Book Value % of
Portfolio
Days to
Maturity
Yield to
Maturity
ABS $13,340,670.91 $12,995,563.58 $13,295,155.14 4.80% 1,055 2.15% Agency $24,010,000.00 $22,612,872.51 $24,037,951.26 8.35% 690 0.97% Cash $42,173,873.26 $42,173,873.26 $42,173,873.26 15.58% 1 0.28% CMO $9,972,621.58 $9,643,457.64 $9,797,298.27 3.56% 1,139 3.41% Corporate $34,050,000.00 $32,076,692.89 $33,691,371.14 11.85% 1,018 2.53% LAIF $100,959,757.36 $100,959,757.36 $100,959,757.36 37.29% 1 2.88% Local Gov Investment Pool $5,269,627.21 $5,269,627.21 $5,269,627.21 1.95% 1 4.92% Municipal Bonds $730,000.00 $707,829.90 $735,102.93 0.26% 551 1.91% Negotiable CD $248,000.00 $246,480.50 $248,000.00 0.09% 139 3.40% US Treasury $40,880,000.00 $39,620,502.36 $40,548,958.58 14.63% 449 2.61% Supranational $4,325,000.00 $3,957,010.40 $4,313,675.71 1.46% 1,029 0.78% Money Market Fund $503,569.77 $503,569.77 $503,569.77 0.19% 1 4.70% Grand Total $276,463,120.09 $270,767,237.38 $275,574,340.63 100% 352 2.23% The portfolio’s return comprises interest income as well as fair value appreciation, both of which are a function of movements in interest rates available in the capital markets. Interest income continues to be robust (the investment portfolio of securities is expected to earn 2.24% for the next year (up from 2.13% last quarter; when LAIF, CAMP and cash are included the expected earnings are 2.23%). Staff continues to work closely with the City’s investment adviser to diversify the portfolio in order to improve safety, liquidity, and return. In the current quarter, staff will continue to evaluate liquidity needs and, where possible, continue the investment in longerduration securities.

Investment Policy
Senate Bill 1489 (SB 1489) recently made changes to the sections of California Government Code which governs the investment of public funds. Though none of the changes require the City to update its investment policy, staff believe that the safety and liquidity of the City’s investment portfolio would be enhanced by adopting the recent changes to California Government Code, as well as select best practices:
 Pursuant to Senate Bill 1489, effective January 1, 2023, the Code specified that an investment’s term or remaining maturity shall be measured from settlement date to final maturity rather than from trade date.

City staff is recommending adding the change in the Maximum Maturities and Mitigating Market Risk in the Portfolio sections.
 City staff is also recommending augmenting the description of Investment Types Under Section E, Suitable and Authorized Investments, to recognize that minimum credit quality requirements apply at the time of purchase. This change will give the City the flexibility to avoid selling an investment at a loss if holding the investment is a prudent decision. Finance staff works closely with the City’s investment advisor to assess these rare occurrences on a case-by-case basis.

Environmental Considerations
Not applicable
Commission Recommendation
Not applicable
Strategic Plan Integration
The City’s mission includes a City Government that is Financially Sound, and the Council’s goal for achieving a Financially Sound City Government is furthered by investing the City treasury in a manner that ensures safety and liquidity first, and where possible a yield on “excess cash”. The preparation of regular quarterly reports on the City’s investments supports the mission and this goal.

Alternatives
Since this agenda report transmits a quarterly financial report pursuant to Government Code section 53646(b) (1), alternatives have not been presented. The City Council may choose to reject or amend the recommended changes to the investment policy.

Coordination and Review
Not applicable
321
Quarterly Treasurer’s Report
June 7, 2023

Budget/Cost Impact
The investment portfolio, as a whole, earned returns at least consistent with the revenue estimates contained in the budget.

ATTACHMENTS

1. Excerpts from Chandler Asset Management Investment Report (March 31, 2023)

2. Proposed Investment Policy (IV-C-2) – Redline

3. Proposed Investment Policy (IV-C-2) - Clean
322
Compliance As of March 31, 2023
Category Standard Comment
Treasury Issues No limitations; Full faith and credit of the U.S. are pledged for payment of principal and interest. Complies U.S. Agencies
25% max per single Agency/GSE issuer; 20% max agency callable securities; Federal Agencies or U.S. Government Sponsored Enterprises (GSE), participations, or other instruments, including those issued by or fully guaranteed as to principal and interest by federal agencies or U.S. GSEs.

Complies
Supranational Obligations
"AA" rating category or better by a Nationally Recognized Statistical Rating Organization ("NRSRO"); 30% maximum; 10% max per issuer; U.S. dollar denominated senior unsecured unsubordinated obligations issued or unconditionally guaranteed by the International Bank for Reconstruction and Development ("IBRD"), the International Finance Corporation ("IFC") or the Inter-American Development Bank ("IADB") Complies
Municipal Securities
"A" rating category or better by a NRSRO; 30% maximum; 5% max per issuer; Obligations of the City, State of California and any local agency within the State of California; Registered Treasury Notes or Bonds of any of the other 49 states in addition to California, including bonds payable solely out of the revenues from a revenue-producing property-owned, controlled, or operated by a state, or by a department, board, agency, or authority of any of the other 49 states, in addition to California.

Complies
Corporate Medium Term Notes "A" rating category or better by a NRSRO; 30% maximum; 5% max per issuer; Issued by corporations organized and operating within the U.S. or by depository institutions licensed by the U.S. or any state and operating within the U.S.

Complies
Asset Backed/ Mortgage Backed/
Mortgage Passthrough/Collateralized
Mortgage Obligation
"AA" rating category or better by a NRSRO; 20% maximum (combined); 5% max per issuer on Asset-Backed or Commercial Mortgage security issuer; From Issuer not defined in sections 3 and 4 of the Authorized investment section of the policy
Complies
Negotiable Certificates of Deposit
(NCD)
No rating required if amount of the NCD is covered by FDIC insured limit; If above FDIC insured limit, requires "A-1" short-term rated or "A" long-term issuer rating category or better by a NRSRO; 30% maximum (combined with CDARS); 5% max per issuer; Issued by a nationally or state-chartered bank, a savings association or a federal association, a state or federal credit union, or by a federally-licensed or state-licensed branch of a foreign bank.

Complies
Non-negotiable Certificates of Deposit 20% maximum (combined FDIC and collateralized); If issued in excess of the FDIC insurance limit, must be fully collateralized with securities in accordance with California law.

Complies
Banker’s Acceptances "A-1" or higher short-term rating by a NRSRO or "A" category or higher long-term rating by a NRSRO; 40% maximum; 5% max per issuer; 180 days max maturity
Complies
Commercial Paper
"A-1" rated or better by a NRSRO; and "A" long-term rating category or better by a NRSRO; 25% maximum; 5% max per issuer; 270 days max maturity; Issuer is a corporation organized and operating in the U.S. with assets > $500 million; 10% max of the outstanding commercial paper of any single issuer.

Complies
Money Market Mutual Funds
Highest rating or "AAA" rated by two NRSROs; SEC registered adviser with AUM >$500 million and experience > 5 years; 20% maximum in Mutual Funds and Money Market Mutual Funds; 20% per one Money Market Mutual Fund; 10% max per one Mutual Fund
Complies
City of West Sacramento Consolidated Portfolio
This portfolio is a consolidation of assets managed by Chandler Asset Management and assets managed internally by City of West Sacramento. Chandler relies on City of West Sacramento to provide accurate information for reporting assets and producing this compliance statement. 15 Attachment 1
323
Compliance As of March 31, 2023
Category Standard Comment
Local Agency Investment Fund (LAIF) Maximum amount permitted by LAIF; Not used by investment adviser Complies Local Government Investment Pools No issuer limitation Complies Repurchase Agreements 102% collateralized; 1 year max maturity; Not used by investment adviser Complies Prohibited Securities
Inverse floaters; Ranges notes, Mortgage-derived, Interest-only strips; Zero interest accrual securities; Futures and Options; Purchasing/ Selling securities on margin; Reverse repurchase agreements; Foreign currency denominated securities
Complies
Minimum Budgeted Operating
Expenditures in Short Term Investments
Minimum 6 months of budgeted operating expenditures in short term investments to provide sufficient liquidity for expected disbursements
Complies
Max Per Issuer 5% max per single issuer, unless otherwise specified in the policy Complies Maximum Maturity 5 years maximum maturity Complies
City of West Sacramento Consolidated Portfolio
This portfolio is a consolidation of assets managed by Chandler Asset Management and assets managed internally by City of West Sacramento. Chandler relies on City of West Sacramento to provide accurate information for reporting assets and producing this compliance statement. 16 Attachment 1
324

ACCOUNT SUMMARY
Beg. Values
as of 12/31/22
End Values
as of 3/31/23
Market Value 278,141,579 270,767,237
Accrued Interest 871,838 1,214,391
Total Market Value 279,013,418 271,981,629
Income Earned 1,254,771 1,321,800
Cont/WD
Par 285,603,989 276,463,120
Book Value 284,763,435 275,574,341
Cost Value 285,023,734 275,773,079

TOP ISSUERS
Local Agency Investment Fund 37.4%
Bank Cash Account 15.1%
Government of United States 14.7%
Federal Home Loan Mortgage Corp 5.4%
Federal National Mortgage Assoc 5.0%
CAMP 1.9%
Federal Home Loan Bank 0.9%
John Deere ABS 0.8%
Total 81.1%

PORTFOLIO CHARACTERISTICS
Average Modified Duration 1.06
Average Coupon 2.10%
Average Purchase YTM 2.22%
Average Market YTM 3.21%
Average S&P/Moody Rating AA/Aa1
Average Final Maturity 1.23 yrs
Average Life 1.13 yrs

SECTOR ALLOCATION MATURITY DISTRIBUTION CREDIT QUALITY (S&P) Portfolio Summary
As of March 31, 2023
City of West Sacramento Consolidated Portfolio
Account #10677

PERFORMANCE REVIEW
Annualized
TOTAL RATE OF RETURN 1M 3M YTD 1YR 2YRS 3YRS 5YRS 10YRS Chandler Asset Management - CONFIDENTIAL Pricing: IDC, Summary credit ratings provided by S&P Execution Time: 4/24/2023 10:52:49 AM Attachment 1
325
Portfolio Characteristics
City of West Sacramento Operating Portfolio
03/31/23 12/31/22
Benchmark* Portfolio Portfolio
Average Maturity (yrs) 2.62 2.72 2.74
Average Modified Duration 2.50 2.34 2.37
Average Purchase Yield n/a 2.24% 2.13%
Average Market Yield 4.02% 4.42% 4.62%
Average Quality** AAA AA/Aa1 AA/Aa1
Total Market Value 122,930,586 120,935,241
*ICE BofA 1-5 Yr US Treasury & Agency Index
**Benchmark is a blended rating of S&P, Moody’s, and Fitch. Portfolio is S&P and Moody’s respectively.

As of March 31, 2023
17 Attachment 1
326

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

40.0%
0 - 0.25 0.25 - 0.50 0.50 - 1 1 - 2 2 - 3 3 - 4 4 - 5 5+ City of West Sacramento Operating Portfolio ICE BofA 1-5 Yr US Treasury & Agency Index Portfolio Compared to the Benchmark
0 - 0.25 0.25 - 0.50 0.50 - 1 1 - 2 2 - 3 3 - 4 4 - 5 5+ Portfolio 1.1% 1.6% 7.2% 35.0% 26.7% 17.4% 11.0% 0.0%
Benchmark* 0.0% 0.0% 1.7% 35.8% 27.9% 20.2% 14.4% 0.0%
*ICE BofA 1-5 Yr US Treasury & Agency Index
Duration Distribution
City of West Sacramento Operating Portfolio
As of March 31, 2023
24 Attachment 1
327
Portfolio Characteristics
City of West Sacramento Consolidated Portfolio
03/31/23
Portfolio
12/31/22
Portfolio
Average Maturity (yrs) 1.23 1.31
Modified Duration 1.06 1.13
Average Purchase Yield 2.22% 2.03%
Average Market Yield 3.21% 3.21%
Average Quality* AA/Aa1 AA+/Aa1
Total Market Value 271,981,629 253,958,826
*Portfolio is S&P and Moody’s, respectively.

As of March 31, 2023
32 Attachment 1
328
Holdings Report
City of West Sacramento Operating Portfolio - Account #10675 CUSIP Security Description Par Value/Units Purchase Date Book Yield
Cost Value
Book Value
Mkt Price
Mkt YTM
Market Value
Accrued Int.
% of Port.

Gain/Loss
Moody/S&P
Fitch
Maturity
Duration
ABS
44891VAC5 Hyundai Auto Lease Trust 2021-B A3

0.330% Due 06/17/2024
441,801.75 06/08/2021

0.34%
441,735.48
441,788.27

98.80 5.96%
436,500.57

64.80 0.36%
(5,287.70)
Aaa / AAA
NR

1.22 0.21
65479JAD5 Nissan Auto Receivables Owner 2019-C A3

1.930% Due 07/15/2024
19,147.29 10/16/2019

1.94%
19,146.28
19,147.01

99.86 6.61%
19,120.52

16.42 0.02%
(26.49)
Aaa / AAA
NR

1.29 0.03
43813DAC2 Honda Auto Receivables 2020-2 A3

0.820% Due 07/15/2024
32,782.31 05/18/2020

0.83%
32,779.73
32,781.51

99.00 5.34%
32,454.78

11.95 0.03%
(326.73)
Aaa / AAA
NR

1.29 0.22
47789KAC7 John Deere Owner Trust 2020-A A3

1.100% Due 08/15/2024
28,157.81 03/04/2020

1.11%
28,156.09
28,157.28

99.57 5.28%
28,035.52

13.77 0.02%
(121.76)
Aaa / NR
AAA

1.38 0.10
43813KAC6 Honda Auto Receivables Trust 2020-3 A3

0.370% Due 10/18/2024
197,159.00 09/22/2020

0.38%
197,130.05
197,153.16

98.22 5.37%
193,648.78

26.34 0.16%
(3,504.38)

NR / AAA
AAA

1.55 0.35
36262XAC8 GM Financial Auto Lease Trust 2021-3 A2

0.390% Due 10/21/2024
665,132.33 08/10/2021

0.39%
665,123.28
665,129.32

97.98 5.51%
651,705.97

79.26 0.53%
(13,423.35)

NR / AAA
AAA

1.56 0.39
47787NAC3 John Deere Owner Trust 2020-B A3

0.510% Due 11/15/2024
57,069.42 07/14/2020

0.52%
57,060.71
57,067.44

99.01 4.91%
56,501.64

12.94 0.05%
(565.80)
Aaa / NR
AAA

1.63 0.22
09690AAC7 BMW Vehicle Lease Trust 2021-2 A3

0.330% Due 12/26/2024
232,308.19 09/08/2021

0.34%
232,284.22
232,300.46

98.01 5.83%
227,679.45

12.78 0.19%
(4,621.01)
Aaa / NR
AAA

1.74 0.36
89236XAC0 Toyota Auto Receivables 2020-D A3

0.350% Due 01/15/2025
146,876.64 10/06/2020

0.36%
146,849.27
146,865.11

98.39 5.80%
144,517.50

22.85 0.12%
(2,347.61)

NR / AAA
AAA

1.80 0.29
44891WAC3 Hyundai Auto Lease Trust 2022-A A3

1.160% Due 01/15/2025
410,000.00 01/11/2022

1.16%
409,990.94
409,995.79

97.25 5.60%
398,718.03
211.38

0.32%
(11,277.76)
Aaa / AAA
NR

1.80 0.62
92290BAA9 Verizon Owner Trust 2020-B A

0.470% Due 02/20/2025
253,275.50 08/04/2020

0.48%
253,222.31
253,253.27

98.86 5.33%
250,385.12

36.37 0.20%
(2,868.15)
Aaa / NR
AAA

1.90 0.23
89238LAC4 Toyota Lease Owner Trust 2022-A A3

1.960% Due 02/20/2025
875,000.00 02/23/2022

1.98%
874,862.28
874,927.14

97.04 5.54%
849,068.50
524.03

0.69%
(25,858.64)

NR / AAA
AAA

1.90 0.83
36265MAC9 GM Financial Auto Lease Trust 2022-1 A3

1.900% Due 03/20/2025
715,000.00 02/15/2022

1.91%
714,993.85
714,996.99

97.34 5.41%
695,986.72
415.10

0.57%
(19,010.27)
Aaa / NR
AAA

1.97 0.76
05601XAC3 BMW Vehicle Lease Trust 2022-1 A3

1.100% Due 03/25/2025
940,000.00 Various

2.26%
924,128.86
931,863.52

97.50 5.66%
916,531.02
172.33

0.75%
(15,332.50)

NR / AAA
AAA

1.99 0.55
89240BAC2 Toyota Auto Receivables Owners 2021-A A3

0.260% Due 05/15/2025
520,380.29 02/02/2021

0.27%
520,283.71
520,350.49

97.46 5.57%
507,154.82

60.13 0.41%
(13,195.67)
Aaa / NR
AAA

2.13 0.48
44933LAC7 Hyundai Auto Receivables Trust 2021-A A3

0.380% Due 09/15/2025
346,580.38 04/20/2021

0.38%
346,543.92
346,566.95

97.24 5.26%
337,016.15

58.53 0.27%
(9,550.80)

NR / AAA
AAA

2.46 0.56
43815GAC3 Honda Auto Receivables Trust 2021-4 A3

0.880% Due 01/21/2026
350,000.00 11/16/2021

0.89%
349,926.22
349,956.91

95.51 5.26%
334,284.30

85.56 0.27%
(15,672.61)
Aaa / NR
AAA

2.81 1.03
As of March 31, 2023
36 Attachment 1
329
Holdings Report
City of West Sacramento Operating Portfolio - Account #10675 CUSIP Security Description Par Value/Units Purchase Date Book Yield
Cost Value
Book Value
Mkt Price
Mkt YTM
Market Value
Accrued Int.
% of Port.

Gain/Loss
Moody/S&P
Fitch
Maturity
Duration
47789QAC4 John Deere Owner Trust 2021-B A3

0.520% Due 03/16/2026
440,000.00 07/13/2021

0.52%
439,960.75
439,978.98

95.67 5.59%
420,932.60
101.69

0.34%
(19,046.38)
Aaa / NR
AAA

2.96 0.86
89238JAC9 Toyota Auto Receivables Trust 2021-D A3

0.710% Due 04/15/2026
325,000.00 11/09/2021

0.71%
324,993.08
324,996.00

95.33 5.42%
309,822.83
102.56

0.25%
(15,173.17)

NR / AAA
AAA

3.04 1.00
44935FAD6 Hyundai Auto Receivables Trust 2021-C A3

0.740% Due 05/15/2026
250,000.00 11/09/2021

0.75%
249,944.20
249,968.36

95.40 5.49%
238,504.75

82.22 0.19%
(11,463.61)

NR / AAA
AAA

3.13 0.97
43815BAC4 Honda Auto Receivables Trust 2022-1 A3

1.880% Due 05/15/2026
560,000.00 02/15/2022

1.89%
559,915.78
559,944.55

95.88 4.95%
536,906.72
467.91

0.44%
(23,037.83)
Aaa / AAA
NR

3.13 1.36
05602RAD3 BMW Vehicle Owner Trust 2022-A A3

3.210% Due 08/25/2026
360,000.00 05/10/2022

3.23%
359,981.28
359,986.53

97.71 4.90%
351,771.48
192.60

0.29%
(8,215.05)
Aaa / AAA
NR

3.41 1.38
362554AC1 GM Financial Securitized Term 2021-4 A3

0.680% Due 09/16/2026
265,000.00 10/13/2021

0.68%
264,993.24
264,996.11

94.86 5.77%
251,390.13

75.08 0.20%
(13,605.98)
Aaa / AAA
NR

3.47 1.02
47787JAC2 John Deere Owner Trust 2022-A A3

2.320% Due 09/16/2026
430,000.00 03/10/2022

2.34%
429,904.88
429,933.22

96.65 5.05%
415,608.33
443.38

0.34%
(14,324.89)
Aaa / NR
AAA

3.47 1.24
448977AD0 Hyundai Auto Receivables Trust 2022-A A3

2.220% Due 10/15/2026
765,000.00 03/09/2022

2.23%
764,970.55
764,980.00

96.14 5.00%
735,440.40
754.80

0.60%
(29,539.60)

NR / AAA
AAA

3.55 1.41
380146AC4 GM Financial Auto Receivables 2022-1 A3

1.260% Due 11/16/2026
225,000.00 01/11/2022

1.27%
224,980.45
224,987.49

95.01 5.68%
213,779.25
118.13

0.17%
(11,208.24)

NR / AAA
AAA

3.63 1.14
47800AAC4 John Deere Owner Trust 2022-B A3

3.740% Due 02/16/2027
445,000.00 07/12/2022

3.77%
444,957.50
444,965.80

98.07 4.89%
436,423.96
739.69

0.36%
(8,541.84)
Aaa / NR
AAA

3.88 1.72
02582JJT8 American Express Credit Trust 2022-2 A

3.390% Due 05/17/2027
940,000.00 05/17/2022

3.42%
939,792.07
939,851.75

97.66 4.60%
917,975.80
1,416.27

0.75%
(21,875.95)

NR / AAA
AAA

4.13 1.99
47800BAC2 John Deere Owner Trust 2022-C A3

5.090% Due 06/15/2027
715,000.00 10/12/2022

5.15%
714,944.52
714,951.34
100.81

4.74%
720,803.66
1,617.49

0.59%
5,852.32
Aaa / NR
AAA

4.21 1.98
92348KAV5 Verizon Master Trust 2022-5 A1A

3.720% Due 07/20/2027
390,000.00 08/02/2022

3.75%
389,982.84
389,986.79

98.64 5.10%
384,677.28
443.30

0.31%
(5,309.51)

NR / AAA
AAA

4.31 1.32
02582JJV3 American Express Credit Trust 2022-3 A

3.750% Due 08/16/2027
1,000,000.00 11/03/2022

5.58%
960,000.00
963,327.60

98.22 4.59%
982,217.00
1,562.50

0.80%
18,889.40
Aaa / NR
AAA

4.38 2.21
TOTAL ABS 13,340,670.91 2.15%
13,283,538.34
13,295,155.14 5.24%
12,995,563.58
9,942.16

10.58%
(299,591.56)
Aaa / AAA
AAA

2.89 1.10
Agency
3133EMRZ7 FFCB Note

0.250% Due 02/26/2024
1,720,000.00 02/22/2021

0.26%
1,719,380.80
1,719,812.83

96.16 4.64%
1,653,953.72
418.06

1.35%
(65,859.11)
Aaa / AA+
AAA

0.91 0.88
3135G0V75 FNMA Note

1.750% Due 07/02/2024
2,000,000.00 09/25/2019

1.64%
2,010,440.00
2,002,746.42

96.48 4.67%
1,929,608.00
8,652.78

1.58%
(73,138.42)
Aaa / AA+
AAA

1.26 1.21
As of March 31, 2023
37 Attachment 1
330
Holdings Report
City of West Sacramento Operating Portfolio - Account #10675 CUSIP Security Description Par Value/Units Purchase Date Book Yield
Cost Value
Book Value
Mkt Price
Mkt YTM
Market Value
Accrued Int.
% of Port.

Gain/Loss
Moody/S&P
Fitch
Maturity
Duration
3130A2UW4 FHLB Note

2.875% Due 09/13/2024
2,000,000.00 09/13/2019

1.79%
2,103,380.00
2,030,095.82

98.07 4.26%
1,961,428.00
2,875.00

1.60%
(68,667.82)
Aaa / AA+
AAA

1.46 1.40
3135G0W66 FNMA Note

1.625% Due 10/15/2024
1,945,000.00 Various

1.73%
1,935,854.05
1,942,100.03

96.09 4.28%
1,868,944.67
14,574.00

1.53%
(73,155.36)
Aaa / AA+
AAA

1.55 1.48
3130AQF40 FHLB Note

1.000% Due 12/20/2024
650,000.00 12/21/2021

1.02%
649,577.50
649,757.08

94.61 4.28%
614,962.40
1,823.61

0.50%
(34,794.68)
Aaa / AA+
AAA

1.73 1.67
3135G0X24 FNMA Note

1.625% Due 01/07/2025
2,170,000.00 Various

1.17%
2,216,515.70
2,187,050.02

95.59 4.24%
2,074,376.78
8,227.91

1.69%
(112,673.24)
Aaa / AA+
AAA

1.78 1.71
3137EAEP0 FHLMC Note

1.500% Due 02/12/2025
2,280,000.00 02/13/2020

1.52%
2,278,244.40
2,279,342.97

95.19 4.21%
2,170,325.16
4,655.00

1.77%
(109,017.81)
Aaa / AA+
AAA

1.87 1.80
3135G03U5 FNMA Note

0.625% Due 04/22/2025
1,795,000.00 04/22/2020

0.67%
1,791,302.30
1,793,475.51

92.98 4.22%
1,668,915.61
4,954.95

1.36%
(124,559.90)
Aaa / AA+
AAA

2.06 2.00
3135G04Z3 FNMA Note

0.500% Due 06/17/2025
2,100,000.00 Various

0.51%
2,098,880.25
2,099,572.53

92.41 4.13%
1,940,633.11
3,033.33

1.58%
(158,939.42)
Aaa / AA+
AAA

2.22 2.15
3137EAEU9 FHLMC Note

0.375% Due 07/21/2025
1,200,000.00 07/21/2020

0.48%
1,194,024.00
1,197,241.34

92.00 4.04%
1,104,036.00
875.00

0.90%
(93,205.34)
Aaa / AA+
AAA

2.31 2.25
3135G05X7 FNMA Note

0.375% Due 08/25/2025
2,150,000.00 Various

0.51%
2,136,456.52
2,143,039.73

91.55 4.11%
1,968,400.26
806.26

1.60%
(174,639.47)
Aaa / AA+
AAA

2.41 2.34
3137EAEX3 FHLMC Note

0.375% Due 09/23/2025
1,800,000.00 Various

0.44%
1,794,640.80
1,797,304.49

91.36 4.08%
1,644,489.00
150.00

1.34%
(152,815.49)
Aaa / AA+
AAA

2.48 2.42
3135G06G3 FNMA Note

0.500% Due 11/07/2025
2,200,000.00 Various

0.56%
2,193,135.20
2,196,412.49

91.49 3.98%
2,012,799.80
4,400.00

1.64%
(183,612.69)
Aaa / AA+
AAA

2.61 2.53
TOTAL Agency 24,010,000.00 0.97%
24,121,831.52
24,037,951.26 4.24%
22,612,872.51
55,445.90

18.44%
(1,425,078.75)
Aaa / AA+
AAA

1.89 1.83
CMO
3137BWWD2 FHLMC K725 A2

3.002% Due 01/25/2024
1,117,621.58 08/18/2021

0.49%
1,179,440.03
1,137,366.15

98.21 5.28%
1,097,578.15
2,795.92

0.90%
(39,788.00)

NR / AAA
AAA

0.82 0.71
3137BFE98 FHLMC K041 A2

3.171% Due 10/25/2024
1,130,000.00 12/15/2021

1.17%
1,189,501.56
1,162,057.27

97.50 4.85%
1,101,713.84
2,986.03

0.90%
(60,343.43)
Aaa / AAA
AAA

1.57 1.40
3137BN6G4 FHLMC KO53

2.995% Due 12/25/2025
2,225,000.00 11/01/2022

4.94%
2,113,228.52
2,127,650.65

96.45 4.42%
2,145,954.65
5,553.23

1.75%
18,304.00

NR / NR
AAA

2.74 2.42
3137BSP72 FHLMC K058 A2

2.653% Due 08/25/2026
500,000.00 11/12/2021

1.35%
528,808.59
520,424.25

94.81 4.30%
474,059.00
1,105.42

0.39%
(46,365.25)

NR / NR
AAA

3.41 3.14
As of March 31, 2023
38 Attachment 1
331
Holdings Report
City of West Sacramento Operating Portfolio - Account #10675 CUSIP Security Description Par Value/Units Purchase Date Book Yield
Cost Value
Book Value
Mkt Price
Mkt YTM
Market Value
Accrued Int.
% of Port.

Gain/Loss
Moody/S&P
Fitch
Maturity
Duration
3137BSRE5 FHLMC K059 A2

3.120% Due 09/25/2026
1,000,000.00 02/18/2022

1.98%
1,042,812.50
1,032,407.77

96.22 4.30%
962,203.00
2,600.00

0.78%
(70,204.77)

NR / AAA
AAA

3.49 3.14
3137BTAC5 FHLMC K060 A2

3.300% Due 10/25/2026
1,000,000.00 10/31/2022

4.80%
946,875.00
952,418.15

96.70 4.28%
966,963.00
2,750.00

0.79%
14,544.85

NR / NR
AAA

3.57 3.28
3137FBBX3 FHLMC K068 A2

3.244% Due 08/25/2027
2,000,000.00 Various

4.59%
1,887,460.94
1,897,935.30

96.10 4.22%
1,922,012.00
5,406.66

1.57%
24,076.70
Aaa / NR
NR

4.41 3.95
3137F4D41 FHLMC K074 A2

3.600% Due 01/25/2028
1,000,000.00 03/14/2023

5.09%
966,757.81
967,038.73

97.30 4.21%
972,974.00
600.00

0.79%
5,935.27

NR / NR
AAA

4.82 4.26
TOTAL CMO 9,972,621.58 3.41%
9,854,884.95
9,797,298.27 4.47%
9,643,457.64
23,797.26

7.86%
(153,840.63)
Aaa / AAA
AAA

3.12 2.79
Corporate
69371RR24 Paccar Financial Corp Note

0.350% Due 02/02/2024
420,000.00 01/28/2021

0.39%
419,512.80
419,863.41

96.07 5.22%
403,478.04
240.92

0.33%
(16,385.37)
A1 / A+
NR

0.84 0.81
808513BN4 Charles Schwab Corp Callable Note Cont 2/18/2024

0.750% Due 03/18/2024
605,000.00 03/16/2021

0.77%
604,697.50
604,902.85

95.19 5.96%
575,894.66
163.85

0.47%
(29,008.19)
A2 / A
A

0.97 0.93
89114QCA4 Toronto Dominion Bank Note

2.650% Due 06/12/2024
1,200,000.00 09/23/2019

2.22%
1,222,788.00
1,205,796.25

97.21 5.08%
1,166,524.80
9,628.33

0.96%
(39,271.45)
A1 / A
AA1.201.15
79466LAG9 Salesforce.com Inc Callable Note Cont 7/15/2022

0.625% Due 07/15/2024
1,050,000.00 Various

0.94%
1,041,590.40
1,045,847.85

94.98 4.68%
997,277.40
1,385.41

0.81%
(48,570.45)
A2 / A+
NR

1.29 1.25
78013XZU5 Royal Bank of Canada Note

2.550% Due 07/16/2024
1,250,000.00 Various

2.21%
1,268,710.00
1,255,119.52

96.74 5.18%
1,209,310.00
6,640.63

0.99%
(45,809.52)
A1 / A
AA1.301.24
69371RR40 Paccar Financial Corp Note

0.500% Due 08/09/2024
515,000.00 08/03/2021

0.52%
514,721.90
514,874.14

94.35 4.85%
485,922.07
371.94

0.40%
(28,952.07)
A1 / A+
NR

1.36 1.32
14913Q3B3 Caterpillar Finl Service Note

2.150% Due 11/08/2024
600,000.00 01/28/2020

1.92%
606,282.00
602,114.41

96.35 4.54%
578,095.20
5,124.17

0.47%
(24,019.21)
A2 / A
A

1.61 1.54
74153WCQ0 Pricoa Global Funding Note

1.150% Due 12/06/2024
670,000.00 12/01/2021

1.19%
669,309.90
669,612.06

94.30 4.72%
631,796.60
2,461.32

0.52%
(37,815.46)
Aa3 / AAAA1.69

1.62 89236TJT3 Toyota Motor Credit Corp Note

1.450% Due 01/13/2025
920,000.00 01/10/2022

1.50%
918,767.20
919,265.49

94.67 4.60%
870,941.00
2,890.33

0.71%
(48,324.49)
A1 / A+
A+

1.79 1.72
64952WEK5 New York Life Global Note

1.450% Due 01/14/2025
1,270,000.00 01/11/2022

1.49%
1,268,628.40
1,269,181.55

94.47 4.71%
1,199,782.97
3,938.76

0.98%
(69,398.58)
Aaa / AA+
AAA

1.79 1.72
90331HPL1 US Bank NA Callable Note Cont 12/21/2024

2.050% Due 01/21/2025
1,285,000.00 01/16/2020

2.10%
1,282,262.95
1,284,009.75

94.19 5.47%
1,210,367.20
5,122.15

0.99%
(73,642.55)
A1 / AAAA1.81

1.73 As of March 31, 2023
39 Attachment 1
332
Holdings Report
City of West Sacramento Operating Portfolio - Account #10675 CUSIP Security Description Par Value/Units Purchase Date Book Yield
Cost Value
Book Value
Mkt Price
Mkt YTM
Market Value
Accrued Int.
% of Port.

Gain/Loss
Moody/S&P
Fitch
Maturity
Duration
78016EZ59 Royal Bank of Canada Note

3.375% Due 04/14/2025
540,000.00 04/07/2022

3.39%
539,800.20
539,864.37

97.04 4.92%
524,036.52
8,454.38

0.43%
(15,827.85)
A1 / A
AA2.041.91
06406RBC0 Bank of NY Mellon Corp Callable Note Cont 3/25/2025

3.350% Due 04/25/2025
935,000.00 04/19/2022

3.35%
934,869.10
934,909.74

96.30 5.26%
900,430.25
13,573.08

0.74%
(34,479.49)
A1 / A
AA2.071.93
06367WB85 Bank of Montreal Note

1.850% Due 05/01/2025
939,000.00 07/23/2021

0.85%
973,573.98
958,149.05

93.66 5.10%
879,456.13
7,238.13

0.72%
(78,692.92)
A2 / AAA2.09

1.99 46647PCH7 JP Morgan Chase & Co Callable Note Cont 6/1/2024

0.824% Due 06/01/2025
1,120,000.00 05/24/2021

1.93%
1,121,449.85
1,120,785.96

94.76 5.37%
1,061,324.33
3,076.27

0.87%
(59,461.63)
A1 / AAA2.17

2.08 46647PCK0 JP Morgan Chase & Co Callable Note Cont 6/23/2024

0.969% Due 06/23/2025
535,000.00 Various

2.06%
535,334.75
535,186.63

94.73 5.36%
506,807.11
1,411.25

0.41%
(28,379.52)
A1 / AAA2.23

2.13 66815L2J7 Northwestern Mutual Glbl Note

4.000% Due 07/01/2025
800,000.00 06/27/2022

4.01%
799,728.00
799,796.00

98.53 4.69%
788,277.60
8,000.00

0.65%
(11,518.40)
Aaa / AA+
AAA

2.25 2.10
637432NG6 National Rural Utilities Callable Note Cont 8/1/2025

3.250% Due 11/01/2025
700,000.00 04/06/2022

3.21%
701,015.00
700,736.13

96.22 4.82%
673,548.40
9,479.17

0.56%
(27,187.73)
A1 / AA+2.59

2.40 40139LBC6 Guardian Life Glob Fun Note

0.875% Due 12/10/2025
1,100,000.00 Various

1.12%
1,088,890.00
1,092,841.97

90.19 4.80%
992,087.80
2,967.70

0.81%
(100,754.17)
Aa1 / AA+
NR

2.70 2.59
66815L2A6 Northwestern Mutual Glbl Note

0.800% Due 01/14/2026
650,000.00 12/06/2021

1.47%
632,755.50
638,269.60

89.92 4.70%
584,500.80
1,112.22

0.48%
(53,768.80)
Aaa / AA+
AAA

2.79 2.69
46647PBK1 JP Morgan Chase & Co Callable Note Cont 4/22/2025

2.083% Due 04/22/2026
334,000.00 05/20/2021

2.20%
346,468.22
341,763.10

93.57 5.42%
312,534.49
3,072.77

0.26%
(29,228.61)
A1 / AAA3.06

1.95 6174468Q5 Morgan Stanley Callable Note Cont 4/28/2025

2.188% Due 04/28/2026
550,000.00 05/18/2022

4.89%
519,535.50
526,225.41

93.83 5.36%
516,042.45
5,114.45

0.42%
(10,182.96)
A1 / AA+3.08

1.97 023135BX3 Amazon.com Inc Callable Note Cont 4/12/2026

1.000% Due 05/12/2026
1,655,000.00 05/10/2021

1.09%
1,647,850.40
1,650,548.14

90.66 4.23%
1,500,490.86
6,390.14

1.23%
(150,057.28)
A1 / AA
AA3.123.00
91324PEC2 United Health Group Inc Callable Note Cont 4/15/2026

1.150% Due 05/15/2026
275,000.00 Various

1.08%
275,889.15
275,565.11

90.93 4.29%
250,043.75
1,194.72

0.20%
(25,521.36)
A3 / A+
A

3.13 2.99
89236TJK2 Toyota Motor Credit Corp Note

1.125% Due 06/18/2026
1,130,000.00 06/15/2021

1.13%
1,129,502.80
1,129,680.33

90.18 4.44%
1,018,987.67
3,637.19

0.83%
(110,692.66)
A1 / A+
A+

3.22 3.08
As of March 31, 2023
40 Attachment 1
333
Holdings Report
City of West Sacramento Operating Portfolio - Account #10675 CUSIP Security Description Par Value/Units Purchase Date Book Yield
Cost Value
Book Value
Mkt Price
Mkt YTM
Market Value
Accrued Int.
% of Port.

Gain/Loss
Moody/S&P
Fitch
Maturity
Duration
06051GJD2 Bank of America Corp Callable Note Cont 6/19/2025

1.319% Due 06/19/2026
1,000,000.00 Various

2.19%
1,002,640.00
1,001,710.13

91.41 5.48%
914,110.00
3,737.16

0.75%
(87,600.13)
A2 / AAA3.22

2.13 57629WDE7 Mass Mutual Global funding Note

1.200% Due 07/16/2026
772,000.00 08/10/2021

1.21%
771,785.72
771,856.83

88.88 4.90%
686,119.64
1,930.00

0.56%
(85,737.19)
Aa3 / AA+
AA+

3.30 3.15
58989V2D5 Met Tower Global Funding Note

1.250% Due 09/14/2026
585,000.00 09/07/2021

1.27%
584,461.80
584,628.03

88.74 4.83%
519,121.98
345.31

0.42%
(65,506.05)
Aa3 / AAAA3.46

3.30 931142ER0 Wal-Mart Stores Callable Note Cont 08/17/2026

1.050% Due 09/17/2026
265,000.00 09/08/2021

1.09%
264,499.15
264,653.03

90.15 4.13%
238,887.96
108.21

0.19%
(25,765.07)
Aa2 / AA
AA

3.47 3.33
26442CAS3 Duke Energy Carolinas Callable Note Cont 9/1/2026

2.950% Due 12/01/2026
1,355,000.00 10/28/2022

4.89%
1,258,727.25
1,268,477.21

94.42 4.62%
1,279,442.49
13,324.17

1.05%
10,965.28
Aa3 / A
NR

3.67 3.38
59217GER6 Metlife Note

1.875% Due 01/11/2027
845,000.00 01/03/2022

1.90%
844,036.70
844,271.46

89.36 5.00%
755,070.88
3,520.83

0.62%
(89,200.58)
Aa3 / AAAA3.79

3.55 61747YEZ4 Morgan Stanley Callable Note 1X 1/28/2026

5.050% Due 01/28/2027
610,000.00 01/17/2023

5.29%
611,063.70
611,011.60

99.72 5.15%
608,296.88
6,161.00

0.50%
(2,714.72)
A1 / AA+3.83

2.58 808513BY0 Charles Schwab Corp Callable Note Cont 2/3/2027

2.450% Due 03/03/2027
725,000.00 03/01/2022

2.46%
724,796.70
724,840.57

89.57 5.44%
649,387.58
1,381.53

0.53%
(75,452.99)
A2 / A
A

3.93 3.65
084664CZ2 Berkshire Hathaway Callable Note Cont 2/15/2027

2.300% Due 03/15/2027
1,225,000.00 03/07/2022

2.30%
1,224,767.25
1,224,815.94

94.68 3.76%
1,159,803.05
1,252.22

0.94%
(65,012.89)
Aa2 / AA
A+

3.96 3.72
06051GHT9 Bank of America Corp Callable Note 1X 4/23/2026

3.559% Due 04/23/2027
750,000.00 Various

4.85%
726,688.38
729,903.88

94.98 5.35%
712,351.50
11,715.04

0.59%
(17,552.38)
A2 / AAA4.07

2.80 665859AW4 Northern Trust Company Callable Note Cont 4/10/2027

4.000% Due 05/10/2027
455,000.00 05/05/2022

4.04%
454,262.90
454,394.50

97.97 4.55%
445,742.57
7,128.33

0.37%
(8,651.93)
A2 / A+
A+

4.11 3.68
91324PEG3 United Health Group Inc Callable Note Cont 4/15/2027

3.700% Due 05/15/2027
465,000.00 05/17/2022

3.69%
465,220.50
465,182.24

97.81 4.28%
454,832.78
6,499.67

0.38%
(10,349.46)
A3 / A+
A

4.13 3.72
61747YEC5 Morgan Stanley Callable Note Cont 7/20/2026

1.512% Due 07/20/2027
750,000.00 10/28/2022

6.03%
637,425.00
647,296.56

88.87 5.22%
666,505.50
2,236.50

0.54%
19,208.94
A1 / AA+4.31

3.14 14913R3A3 Caterpillar Financial Service Note

3.600% Due 08/12/2027
1,000,000.00 11/02/2022

5.06%
938,730.00
943,935.49

97.84 4.14%
978,439.00
4,900.00

0.80%
34,503.51
A2 / A
A

4.37 3.97
As of March 31, 2023
41 Attachment 1
334
Holdings Report
City of West Sacramento Operating Portfolio - Account #10675 CUSIP Security Description Par Value/Units Purchase Date Book Yield
Cost Value
Book Value
Mkt Price
Mkt YTM
Market Value
Accrued Int.
% of Port.

Gain/Loss
Moody/S&P
Fitch
Maturity
Duration
756109BG8 Realty Income Corp Calllable Note Cont 5/15/2027

3.950% Due 08/15/2027
1,425,000.00 Various

5.42%
1,337,997.25
1,345,227.14

96.35 4.89%
1,372,960.43
7,192.29

1.12%
27,733.29
A3 / ANR4.38

3.94 57636QAW4 MasterCard Inc Callable Note Cont 2/9/28

4.875% Due 03/09/2028
775,000.00 03/06/2023

4.90%
774,248.25
774,257.71
102.92

4.20%
797,662.55
2,308.85

0.65%
23,404.84
Aa3 / A+
NR

4.95 4.29
TOTAL Corporate 34,050,000.00 2.53%
33,685,284.05
33,691,371.14 4.85%
32,076,692.89
186,430.39

26.24%
(1,614,678.25)
A1 / A+
AA2.792.51
Money Market Fund
262006208 Dreyfus Gov't Cash Management Money Market Fund #289
503,569.77 Various

4.70%
503,569.77
503,569.77

1.00 4.70%
503,569.77

0.00 0.41%

0.00 Aaa / AAA
NR

0.00 0.00
TOTAL Money Market Fund 503,569.77 4.70%
503,569.77
503,569.77 4.70%
503,569.77

0.00 0.41%

0.00 Aaa / AAA
NR

0.00 0.00
Municipal Bonds
13063DRK6 California State Taxable GO

2.400% Due 10/01/2024
730,000.00 10/16/2019

1.91%
746,768.10
735,102.93

96.96 4.52%
707,829.90
8,760.00

0.58%
(27,273.03)
Aa2 / AAAA1.51

1.43 TOTAL Municipal Bonds 730,000.00 1.91%
746,768.10
735,102.93 4.52%
707,829.90
8,760.00

0.58%
(27,273.03)
Aa2 / AAAA1.51

1.43 Negotiable CD
33715LCB4 First Technology Federal Negotiable CD

3.400% Due 08/17/2023
248,000.00 08/17/2018

3.40%
248,000.00
248,000.00

99.39 5.03%
246,480.50
346.52

0.20%
(1,519.50)

NR / NR
NR

0.38 0.38
TOTAL Negotiable CD 248,000.00 3.40%
248,000.00
248,000.00 5.03%
246,480.50
346.52

0.20%
(1,519.50)

NR / NR
NR

0.38 0.38
Supranational
459058JL8 Intl. Bank Recon & Development Note

0.500% Due 10/28/2025
2,150,000.00 Various

0.60%
2,140,429.05
2,144,758.44

91.64 3.95%
1,970,174.00
4,568.76

1.61%
(174,584.44)
Aaa / AAA
AAA

2.58 2.51
4581X0DV7 Inter-American Dev Bank Note

0.875% Due 04/20/2026
2,175,000.00 04/13/2021

0.97%
2,165,038.50
2,168,917.27

91.35 3.91%
1,986,836.40
8,511.20

1.62%
(182,080.87)
Aaa / AAA
AAA

3.06 2.95
TOTAL Supranational 4,325,000.00 0.78%
4,305,467.55
4,313,675.71 3.93%
3,957,010.40
13,079.96

3.23%
(356,665.31)
Aaa / AAA
AAA

2.82 2.73
As of March 31, 2023
42 Attachment 1
335
Holdings Report
City of West Sacramento Operating Portfolio - Account #10675 CUSIP Security Description Par Value/Units Purchase Date Book Yield
Cost Value
Book Value
Mkt Price
Mkt YTM
Market Value
Accrued Int.
% of Port.

Gain/Loss
Moody/S&P
Fitch
Maturity
Duration
US Treasury
91282CBR1 US Treasury Note

0.250% Due 03/15/2024
1,000,000.00 03/30/2021

0.33%
997,578.13
999,217.38

95.94 4.64%
959,414.00
115.49

0.78%
(39,803.38)
Aaa / AA+
AAA

0.96 0.93
912828X70 US Treasury Note

2.000% Due 04/30/2024
1,500,000.00 09/25/2019

1.62%
1,525,078.12
1,505,903.37

97.25 4.63%
1,458,808.50
12,596.69

1.20%
(47,094.87)
Aaa / AA+
AAA

1.08 1.04
912828XX3 US Treasury Note

2.000% Due 06/30/2024
2,000,000.00 09/30/2019

1.60%
2,036,562.50
2,009,609.51

97.03 4.46%
1,940,626.00
10,055.25

1.59%
(68,983.51)
Aaa / AA+
AAA

1.25 1.21
912828D56 US Treasury Note

2.375% Due 08/15/2024
2,000,000.00 09/18/2019

1.71%
2,062,578.13
2,017,530.26

97.34 4.39%
1,946,718.00
5,904.70

1.59%
(70,812.26)
Aaa / AA+
AAA

1.38 1.33
9128283D0 US Treasury Note

2.250% Due 10/31/2024
2,000,000.00 11/07/2019

1.77%
2,045,234.38
2,014,398.41

96.91 4.29%
1,938,126.00
18,895.03

1.59%
(76,272.41)
Aaa / AA+
AAA

1.59 1.52
91282CDS7 US Treasury Note

1.125% Due 01/15/2025
1,000,000.00 02/02/2022

1.36%
993,125.00
995,818.83

94.77 4.18%
947,695.00
2,361.88

0.77%
(48,123.83)
Aaa / AA+
AAA

1.80 1.74
912828ZC7 US Treasury Note

1.125% Due 02/28/2025
2,000,000.00 03/18/2020

0.81%
2,030,859.38
2,011,937.30

94.55 4.11%
1,891,094.00
1,956.52

1.54%
(120,843.30)
Aaa / AA+
AAA

1.92 1.86
912828ZF0 US Treasury Note

0.500% Due 03/31/2025
2,000,000.00 05/28/2020

0.35%
2,014,140.63
2,005,841.91

93.27 4.04%
1,865,390.00

27.32 1.52%
(140,451.91)
Aaa / AA+
AAA

2.00 1.95
912828XB1 US Treasury Note

2.125% Due 05/15/2025
1,000,000.00 04/06/2022

2.78%
980,742.19
986,838.80

96.13 4.04%
961,328.00
8,042.13

0.79%
(25,510.80)
Aaa / AA+
AAA

2.13 2.03
91282CAB7 US Treasury Note

0.250% Due 07/31/2025
1,100,000.00 03/12/2021

0.72%
1,077,828.13
1,088,186.10

91.83 3.94%
1,010,152.00
455.80

0.82%
(78,034.10)
Aaa / AA+
AAA

2.34 2.29
91282CFP1 US Treasury Note

4.250% Due 10/15/2025
2,400,000.00 10/28/2022

4.37%
2,392,031.25
2,393,152.78
100.77

3.93%
2,418,561.60
47,076.92

2.01%
25,408.82
Aaa / AA+
AAA

2.55 2.34
91282CAT8 US Treasury Note

0.250% Due 10/31/2025
400,000.00 03/12/2021

0.79%
390,265.63
394,565.79

91.18 3.87%
364,703.20
419.89

0.30%
(29,862.59)
Aaa / AA+
AAA

2.59 2.52
91282CFW6 US Treasury Note

4.500% Due 11/15/2025
2,400,000.00 11/10/2022

4.27%
2,415,656.25
2,413,699.22
101.48

3.90%
2,435,438.40
40,872.93

2.01%
21,739.18
Aaa / AA+
AAA

2.63 2.42
91282CAZ4 US Treasury Note

0.375% Due 11/30/2025
1,250,000.00 03/26/2021

0.77%
1,227,587.89
1,237,211.84

91.22 3.87%
1,140,235.00
1,571.09

0.93%
(96,976.84)
Aaa / AA+
AAA

2.67 2.60
91282CCW9 US Treasury Note

0.750% Due 08/31/2026
530,000.00 09/23/2021

0.90%
526,252.73
527,404.78

90.38 3.78%
478,987.50
345.65

0.39%
(48,417.28)
Aaa / AA+
AAA

3.42 3.31
91282CCZ2 US Treasury Note

0.875% Due 09/30/2026
1,060,000.00 10/18/2021

1.19%
1,044,141.41
1,048,784.02

90.56 3.78%
959,962.50

25.34 0.78%
(88,821.52)
Aaa / AA+
AAA

3.50 3.39
91282CDG3 US Treasury Note

1.125% Due 10/31/2026
1,060,000.00 11/15/2021

1.25%
1,053,540.63
1,055,325.97

91.21 3.77%
966,794.20
5,007.18

0.79%
(88,531.77)
Aaa / AA+
AAA

3.59 3.44
As of March 31, 2023
43 Attachment 1
336
Holdings Report
City of West Sacramento Operating Portfolio - Account #10675 CUSIP Security Description Par Value/Units Purchase Date Book Yield
Cost Value
Book Value
Mkt Price
Mkt YTM
Market Value
Accrued Int.
% of Port.

Gain/Loss
Moody/S&P
Fitch
Maturity
Duration
912828YQ7 US Treasury Note

1.625% Due 10/31/2026
2,400,000.00 11/02/2022

4.43%
2,156,250.00
2,181,159.98

92.89 3.76%
2,229,468.00
16,375.69

1.83%
48,308.02
Aaa / AA+
AAA

3.59 3.40
91282CET4 US Treasury Note

2.625% Due 05/31/2027
600,000.00 06/13/2022

3.41%
578,718.75
582,136.43

95.88 3.70%
575,296.80
5,278.85

0.47%
(6,839.63)
Aaa / AA+
AAA

4.17 3.86
91282CEW7 US Treasury Note

3.250% Due 06/30/2027
1,500,000.00 Various

3.40%
1,490,273.44
1,491,043.67

98.27 3.69%
1,474,101.00
12,254.83

1.21%
(16,942.67)
Aaa / AA+
AAA

4.25 3.90
91282CFB2 US Treasury Note

2.750% Due 07/31/2027
1,180,000.00 Various

3.00%
1,166,739.07
1,168,403.49

96.30 3.68%
1,136,395.46
5,378.45

0.93%
(32,008.03)
Aaa / AA+
AAA

4.34 4.02
91282CFH9 US Treasury Note

3.125% Due 08/31/2027
3,500,000.00 Various

3.28%
3,474,796.89
3,477,611.70

97.81 3.67%
3,423,437.50
9,510.87

2.79%
(54,174.20)
Aaa / AA+
AAA

4.42 4.07
91282CFU0 US Treasury Note

4.125% Due 10/31/2027
2,400,000.00 11/03/2022

4.42%
2,368,968.75
2,371,489.40
101.92

3.67%
2,446,032.00
41,569.06

2.02%
74,542.60
Aaa / AA+
AAA

4.59 4.08
91282CGC9 US Treasury Note

3.875% Due 12/31/2027
700,000.00 01/25/2023

3.57%
709,679.69
709,330.15
101.05

3.63%
707,355.60
6,818.72

0.58%
(1,974.55)
Aaa / AA+
AAA

4.76 4.27
91282CGH8 US Treasury Note

3.500% Due 01/31/2028
1,000,000.00 03/14/2023

3.90%
982,578.13
982,724.86

99.48 3.62%
994,766.00
5,801.10

0.81%
12,041.14
Aaa / AA+
AAA

4.84 4.39
91282CGP0 US Treasury Note

4.000% Due 02/29/2028
2,900,000.00 02/23/2023

4.16%
2,879,269.53
2,879,632.63
101.71

3.62%
2,949,616.10
10,086.96

2.41%
69,983.47
Aaa / AA+
AAA

4.92 4.42
TOTAL US Treasury 40,880,000.00 2.61%
40,620,476.63
40,548,958.58 3.94%
39,620,502.36
268,804.34

32.45%
(928,456.22)
Aaa / AA+
AAA

3.03 2.81
TOTAL PORTFOLIO 128,059,862.26 2.24%
127,369,820.91
127,171,082.80 4.42%
122,363,979.55
566,606.53
100.00%
(4,807,103.25)
Aa1 / AA
AAA

2.72 2.34
TOTAL MARKET VALUE PLUS ACCRUALS 122,930,586.08
As of March 31, 2023
44 Attachment 1
337
Holdings Report
City of West Sacramento Reporting Portfolio - Account #10676 CUSIP Security Description Par Value/Units Purchase Date Book Yield
Cost Value
Book Value
Mkt Price
Mkt YTM
Market Value
Accrued Int.
% of Port.

Gain/Loss
Moody/S&P
Fitch
Maturity
Duration
Cash
90BOFA$00 Cash BOA Cash Acct 41,126,496.24 Various

0.25%
41,126,496.24
41,126,496.24

1.00 0.25%
41,126,496.24

0.00 27.59%

0.00 NR / NR
NR

0.00 0.00
86723G1$8 Suncrest Bank Deposit Account XXX3985 1,047,377.02 Various

1.43%
1,047,377.02
1,047,377.02

1.00 1.43%
1,047,377.02

0.00 0.70%

0.00 NR / NR
NR

0.00 0.00
TOTAL Cash 42,173,873.26 0.28%
42,173,873.26
42,173,873.26 0.28%
42,173,873.26

0.00 28.29%

0.00 NR / NR
NR

0.00 0.00
LAIF
90LAIF$00 Local Agency Investment Fund State Pool 100,959,757.36 Various

2.88%
100,959,757.36
100,959,757.36

1.00 2.88%
100,959,757.36
647,784.77

68.17%

0.00 NR / NR
NR

0.00 0.00
TOTAL LAIF 100,959,757.36 2.88%
100,959,757.36
100,959,757.36 2.88%
100,959,757.36
647,784.77

68.17%

0.00 NR / NR
NR

0.00 0.00
Local Gov Investment Pool
90CAMP$00 California Asset Mgmt Program CAMP 5,269,627.21 Various

4.92%
5,269,627.21
5,269,627.21

1.00 4.92%
5,269,627.21

0.00 3.54%

0.00 NR / AAA
NR

0.00 0.00
TOTAL Local Gov Investment Pool 5,269,627.21 4.92%
5,269,627.21
5,269,627.21 4.92%
5,269,627.21

0.00 3.54%

0.00 NR / AAA
NR

0.00 0.00
TOTAL PORTFOLIO 148,403,257.83 2.21%
148,403,257.83
148,403,257.83 2.22%
148,403,257.83
647,784.77
100.00%

0.00 NR / AAA
NR

0.00 0.00
TOTAL MARKET VALUE PLUS ACCRUALS 149,051,042.60
As of March 31, 2023
45 Attachment 1
338
Holdings Report
City of West Sacramento Consolidated Portfolio - Account #10677 CUSIP Security Description Par Value/Units Purchase Date Book Yield
Cost Value
Book Value
Mkt Price
Mkt YTM
Market Value
Accrued Int.
% of Port.

Gain/Loss
Moody/S&P
Fitch
Maturity
Duration
ABS
44891VAC5 Hyundai Auto Lease Trust 2021-B A3

0.330% Due 06/17/2024
441,801.75 06/08/2021

0.34%
441,735.48
441,788.27

98.80 5.96%
436,500.57

64.80 0.16%
(5,287.70)
Aaa / AAA
NR

1.22 0.21
65479JAD5 Nissan Auto Receivables Owner 2019-C A3

1.930% Due 07/15/2024
19,147.29 10/16/2019

1.94%
19,146.28
19,147.01

99.86 6.61%
19,120.52

16.42 0.01%
(26.49)
Aaa / AAA
NR

1.29 0.03
43813DAC2 Honda Auto Receivables 2020-2 A3

0.820% Due 07/15/2024
32,782.31 05/18/2020

0.83%
32,779.73
32,781.51

99.00 5.34%
32,454.78

11.95 0.01%
(326.73)
Aaa / AAA
NR

1.29 0.22
47789KAC7 John Deere Owner Trust 2020-A A3

1.100% Due 08/15/2024
28,157.81 03/04/2020

1.11%
28,156.09
28,157.28

99.57 5.28%
28,035.52

13.77 0.01%
(121.76)
Aaa / NR
AAA

1.38 0.10
43813KAC6 Honda Auto Receivables Trust 2020-3 A3

0.370% Due 10/18/2024
197,159.00 09/22/2020

0.38%
197,130.05
197,153.16

98.22 5.37%
193,648.78

26.34 0.07%
(3,504.38)

NR / AAA
AAA

1.55 0.35
36262XAC8 GM Financial Auto Lease Trust 2021-3 A2

0.390% Due 10/21/2024
665,132.33 08/10/2021

0.39%
665,123.28
665,129.32

97.98 5.51%
651,705.97

79.26 0.24%
(13,423.35)

NR / AAA
AAA

1.56 0.39
47787NAC3 John Deere Owner Trust 2020-B A3

0.510% Due 11/15/2024
57,069.42 07/14/2020

0.52%
57,060.71
57,067.44

99.01 4.91%
56,501.64

12.94 0.02%
(565.80)
Aaa / NR
AAA

1.63 0.22
09690AAC7 BMW Vehicle Lease Trust 2021-2 A3

0.330% Due 12/26/2024
232,308.19 09/08/2021

0.34%
232,284.22
232,300.46

98.01 5.83%
227,679.45

12.78 0.08%
(4,621.01)
Aaa / NR
AAA

1.74 0.36
89236XAC0 Toyota Auto Receivables 2020-D A3

0.350% Due 01/15/2025
146,876.64 10/06/2020

0.36%
146,849.27
146,865.11

98.39 5.80%
144,517.50

22.85 0.05%
(2,347.61)

NR / AAA
AAA

1.80 0.29
44891WAC3 Hyundai Auto Lease Trust 2022-A A3

1.160% Due 01/15/2025
410,000.00 01/11/2022

1.16%
409,990.94
409,995.79

97.25 5.60%
398,718.03
211.38

0.15%
(11,277.76)
Aaa / AAA
NR

1.80 0.62
92290BAA9 Verizon Owner Trust 2020-B A

0.470% Due 02/20/2025
253,275.50 08/04/2020

0.48%
253,222.31
253,253.27

98.86 5.33%
250,385.12

36.37 0.09%
(2,868.15)
Aaa / NR
AAA

1.90 0.23
89238LAC4 Toyota Lease Owner Trust 2022-A A3

1.960% Due 02/20/2025
875,000.00 02/23/2022

1.98%
874,862.28
874,927.14

97.04 5.54%
849,068.50
524.03

0.31%
(25,858.64)

NR / AAA
AAA

1.90 0.83
36265MAC9 GM Financial Auto Lease Trust 2022-1 A3

1.900% Due 03/20/2025
715,000.00 02/15/2022

1.91%
714,993.85
714,996.99

97.34 5.41%
695,986.72
415.10

0.26%
(19,010.27)
Aaa / NR
AAA

1.97 0.76
05601XAC3 BMW Vehicle Lease Trust 2022-1 A3

1.100% Due 03/25/2025
940,000.00 Various

2.26%
924,128.86
931,863.52

97.50 5.66%
916,531.02
172.33

0.34%
(15,332.50)

NR / AAA
AAA

1.99 0.55
89240BAC2 Toyota Auto Receivables Owners 2021-A A3

0.260% Due 05/15/2025
520,380.29 02/02/2021

0.27%
520,283.71
520,350.49

97.46 5.57%
507,154.82

60.13 0.19%
(13,195.67)
Aaa / NR
AAA

2.13 0.48
44933LAC7 Hyundai Auto Receivables Trust 2021-A A3

0.380% Due 09/15/2025
346,580.38 04/20/2021

0.38%
346,543.92
346,566.95

97.24 5.26%
337,016.15

58.53 0.12%
(9,550.80)

NR / AAA
AAA

2.46 0.56
43815GAC3 Honda Auto Receivables Trust 2021-4 A3

0.880% Due 01/21/2026
350,000.00 11/16/2021

0.89%
349,926.22
349,956.91

95.51 5.26%
334,284.30

85.56 0.12%
(15,672.61)
Aaa / NR
AAA

2.81 1.03
As of March 31, 2023
46 Attachment 1
339
Holdings Report
City of West Sacramento Consolidated Portfolio - Account #10677 CUSIP Security Description Par Value/Units Purchase Date Book Yield
Cost Value
Book Value
Mkt Price
Mkt YTM
Market Value
Accrued Int.
% of Port.

Gain/Loss
Moody/S&P
Fitch
Maturity
Duration
47789QAC4 John Deere Owner Trust 2021-B A3

0.520% Due 03/16/2026
440,000.00 07/13/2021

0.52%
439,960.75
439,978.98

95.67 5.59%
420,932.60
101.69

0.15%
(19,046.38)
Aaa / NR
AAA

2.96 0.86
89238JAC9 Toyota Auto Receivables Trust 2021-D A3

0.710% Due 04/15/2026
325,000.00 11/09/2021

0.71%
324,993.08
324,996.00

95.33 5.42%
309,822.83
102.56

0.11%
(15,173.17)

NR / AAA
AAA

3.04 1.00
44935FAD6 Hyundai Auto Receivables Trust 2021-C A3

0.740% Due 05/15/2026
250,000.00 11/09/2021

0.75%
249,944.20
249,968.36

95.40 5.49%
238,504.75

82.22 0.09%
(11,463.61)

NR / AAA
AAA

3.13 0.97
43815BAC4 Honda Auto Receivables Trust 2022-1 A3

1.880% Due 05/15/2026
560,000.00 02/15/2022

1.89%
559,915.78
559,944.55

95.88 4.95%
536,906.72
467.91

0.20%
(23,037.83)
Aaa / AAA
NR

3.13 1.36
05602RAD3 BMW Vehicle Owner Trust 2022-A A3

3.210% Due 08/25/2026
360,000.00 05/10/2022

3.23%
359,981.28
359,986.53

97.71 4.90%
351,771.48
192.60

0.13%
(8,215.05)
Aaa / AAA
NR

3.41 1.38
362554AC1 GM Financial Securitized Term 2021-4 A3

0.680% Due 09/16/2026
265,000.00 10/13/2021

0.68%
264,993.24
264,996.11

94.86 5.77%
251,390.13

75.08 0.09%
(13,605.98)
Aaa / AAA
NR

3.47 1.02
47787JAC2 John Deere Owner Trust 2022-A A3

2.320% Due 09/16/2026
430,000.00 03/10/2022

2.34%
429,904.88
429,933.22

96.65 5.05%
415,608.33
443.38

0.15%
(14,324.89)
Aaa / NR
AAA

3.47 1.24
448977AD0 Hyundai Auto Receivables Trust 2022-A A3

2.220% Due 10/15/2026
765,000.00 03/09/2022

2.23%
764,970.55
764,980.00

96.14 5.00%
735,440.40
754.80

0.27%
(29,539.60)

NR / AAA
AAA

3.55 1.41
380146AC4 GM Financial Auto Receivables 2022-1 A3

1.260% Due 11/16/2026
225,000.00 01/11/2022

1.27%
224,980.45
224,987.49

95.01 5.68%
213,779.25
118.13

0.08%
(11,208.24)

NR / AAA
AAA

3.63 1.14
47800AAC4 John Deere Owner Trust 2022-B A3

3.740% Due 02/16/2027
445,000.00 07/12/2022

3.77%
444,957.50
444,965.80

98.07 4.89%
436,423.96
739.69

0.16%
(8,541.84)
Aaa / NR
AAA

3.88 1.72
02582JJT8 American Express Credit Trust 2022-2 A

3.390% Due 05/17/2027
940,000.00 05/17/2022

3.42%
939,792.07
939,851.75

97.66 4.60%
917,975.80
1,416.27

0.34%
(21,875.95)

NR / AAA
AAA

4.13 1.99
47800BAC2 John Deere Owner Trust 2022-C A3

5.090% Due 06/15/2027
715,000.00 10/12/2022

5.15%
714,944.52
714,951.34
100.81

4.74%
720,803.66
1,617.49

0.27%
5,852.32
Aaa / NR
AAA

4.21 1.98
92348KAV5 Verizon Master Trust 2022-5 A1A

3.720% Due 07/20/2027
390,000.00 08/02/2022

3.75%
389,982.84
389,986.79

98.64 5.10%
384,677.28
443.30

0.14%
(5,309.51)

NR / AAA
AAA

4.31 1.32
02582JJV3 American Express Credit Trust 2022-3 A

3.750% Due 08/16/2027
1,000,000.00 11/03/2022

5.58%
960,000.00
963,327.60

98.22 4.59%
982,217.00
1,562.50

0.36%
18,889.40
Aaa / NR
AAA

4.38 2.21
TOTAL ABS 13,340,670.91 2.15%
13,283,538.34
13,295,155.14 5.24%
12,995,563.58
9,942.16

4.78%
(299,591.56)
Aaa / AAA
AAA

2.89 1.10
Agency
3133EMRZ7 FFCB Note

0.250% Due 02/26/2024
1,720,000.00 02/22/2021

0.26%
1,719,380.80
1,719,812.83

96.16 4.64%
1,653,953.72
418.06

0.61%
(65,859.11)
Aaa / AA+
AAA

0.91 0.88
3135G0V75 FNMA Note

1.750% Due 07/02/2024
2,000,000.00 09/25/2019

1.64%
2,010,440.00
2,002,746.42

96.48 4.67%
1,929,608.00
8,652.78

0.71%
(73,138.42)
Aaa / AA+
AAA

1.26 1.21
As of March 31, 2023
47 Attachment 1
340
Holdings Report
City of West Sacramento Consolidated Portfolio - Account #10677 CUSIP Security Description Par Value/Units Purchase Date Book Yield
Cost Value
Book Value
Mkt Price
Mkt YTM
Market Value
Accrued Int.
% of Port.

Gain/Loss
Moody/S&P
Fitch
Maturity
Duration
3130A2UW4 FHLB Note

2.875% Due 09/13/2024
2,000,000.00 09/13/2019

1.79%
2,103,380.00
2,030,095.82

98.07 4.26%
1,961,428.00
2,875.00

0.72%
(68,667.82)
Aaa / AA+
AAA

1.46 1.40
3135G0W66 FNMA Note

1.625% Due 10/15/2024
1,945,000.00 Various

1.73%
1,935,854.05
1,942,100.03

96.09 4.28%
1,868,944.67
14,574.00

0.69%
(73,155.36)
Aaa / AA+
AAA

1.55 1.48
3130AQF40 FHLB Note

1.000% Due 12/20/2024
650,000.00 12/21/2021

1.02%
649,577.50
649,757.08

94.61 4.28%
614,962.40
1,823.61

0.23%
(34,794.68)
Aaa / AA+
AAA

1.73 1.67
3135G0X24 FNMA Note

1.625% Due 01/07/2025
2,170,000.00 Various

1.17%
2,216,515.70
2,187,050.02

95.59 4.24%
2,074,376.78
8,227.91

0.77%
(112,673.24)
Aaa / AA+
AAA

1.78 1.71
3137EAEP0 FHLMC Note

1.500% Due 02/12/2025
2,280,000.00 02/13/2020

1.52%
2,278,244.40
2,279,342.97

95.19 4.21%
2,170,325.16
4,655.00

0.80%
(109,017.81)
Aaa / AA+
AAA

1.87 1.80
3135G03U5 FNMA Note

0.625% Due 04/22/2025
1,795,000.00 04/22/2020

0.67%
1,791,302.30
1,793,475.51

92.98 4.22%
1,668,915.61
4,954.95

0.62%
(124,559.90)
Aaa / AA+
AAA

2.06 2.00
3135G04Z3 FNMA Note

0.500% Due 06/17/2025
2,100,000.00 Various

0.51%
2,098,880.25
2,099,572.53

92.41 4.13%
1,940,633.11
3,033.33

0.71%
(158,939.42)
Aaa / AA+
AAA

2.22 2.15
3137EAEU9 FHLMC Note

0.375% Due 07/21/2025
1,200,000.00 07/21/2020

0.48%
1,194,024.00
1,197,241.34

92.00 4.04%
1,104,036.00
875.00

0.41%
(93,205.34)
Aaa / AA+
AAA

2.31 2.25
3135G05X7 FNMA Note

0.375% Due 08/25/2025
2,150,000.00 Various

0.51%
2,136,456.52
2,143,039.73

91.55 4.11%
1,968,400.26
806.26

0.72%
(174,639.47)
Aaa / AA+
AAA

2.41 2.34
3137EAEX3 FHLMC Note

0.375% Due 09/23/2025
1,800,000.00 Various

0.44%
1,794,640.80
1,797,304.49

91.36 4.08%
1,644,489.00
150.00

0.60%
(152,815.49)
Aaa / AA+
AAA

2.48 2.42
3135G06G3 FNMA Note

0.500% Due 11/07/2025
2,200,000.00 Various

0.56%
2,193,135.20
2,196,412.49

91.49 3.98%
2,012,799.80
4,400.00

0.74%
(183,612.69)
Aaa / AA+
AAA

2.61 2.53
TOTAL Agency 24,010,000.00 0.97%
24,121,831.52
24,037,951.26 4.24%
22,612,872.51
55,445.90

8.33%
(1,425,078.75)
Aaa / AA+
AAA

1.89 1.83
Cash
90BOFA$00 Cash BOA Cash Acct 41,126,496.24 Various

0.25%
41,126,496.24
41,126,496.24

1.00 0.25%
41,126,496.24

0.00 15.12%

0.00 NR / NR
NR

0.00 0.00
86723G1$8 Suncrest Bank Deposit Account XXX3985 1,047,377.02 Various

1.43%
1,047,377.02
1,047,377.02

1.00 1.43%
1,047,377.02

0.00 0.39%

0.00 NR / NR
NR

0.00 0.00
TOTAL Cash 42,173,873.26 0.28%
42,173,873.26
42,173,873.26 0.28%
42,173,873.26

0.00 15.51%

0.00 NR / NR
NR

0.00 0.00
As of March 31, 2023
48 Attachment 1
341
Holdings Report
City of West Sacramento Consolidated Portfolio - Account #10677 CUSIP Security Description Par Value/Units Purchase Date Book Yield
Cost Value
Book Value
Mkt Price
Mkt YTM
Market Value
Accrued Int.
% of Port.

Gain/Loss
Moody/S&P
Fitch
Maturity
Duration
CMO
3137BWWD2 FHLMC K725 A2

3.002% Due 01/25/2024
1,117,621.58 08/18/2021

0.49%
1,179,440.03
1,137,366.15

98.21 5.28%
1,097,578.15
2,795.92

0.40%
(39,788.00)

NR / AAA
AAA

0.82 0.71
3137BFE98 FHLMC K041 A2

3.171% Due 10/25/2024
1,130,000.00 12/15/2021

1.17%
1,189,501.56
1,162,057.27

97.50 4.85%
1,101,713.84
2,986.03

0.41%
(60,343.43)
Aaa / AAA
AAA

1.57 1.40
3137BN6G4 FHLMC KO53

2.995% Due 12/25/2025
2,225,000.00 11/01/2022

4.94%
2,113,228.52
2,127,650.65

96.45 4.42%
2,145,954.65
5,553.23

0.79%
18,304.00

NR / NR
AAA

2.74 2.42
3137BSP72 FHLMC K058 A2

2.653% Due 08/25/2026
500,000.00 11/12/2021

1.35%
528,808.59
520,424.25

94.81 4.30%
474,059.00
1,105.42

0.17%
(46,365.25)

NR / NR
AAA

3.41 3.14
3137BSRE5 FHLMC K059 A2

3.120% Due 09/25/2026
1,000,000.00 02/18/2022

1.98%
1,042,812.50
1,032,407.77

96.22 4.30%
962,203.00
2,600.00

0.35%
(70,204.77)

NR / AAA
AAA

3.49 3.14
3137BTAC5 FHLMC K060 A2

3.300% Due 10/25/2026
1,000,000.00 10/31/2022

4.80%
946,875.00
952,418.15

96.70 4.28%
966,963.00
2,750.00

0.36%
14,544.85

NR / NR
AAA

3.57 3.28
3137FBBX3 FHLMC K068 A2

3.244% Due 08/25/2027
2,000,000.00 Various

4.59%
1,887,460.94
1,897,935.30

96.10 4.22%
1,922,012.00
5,406.66

0.71%
24,076.70
Aaa / NR
NR

4.41 3.95
3137F4D41 FHLMC K074 A2

3.600% Due 01/25/2028
1,000,000.00 03/14/2023

5.09%
966,757.81
967,038.73

97.30 4.21%
972,974.00
600.00

0.36%
5,935.27

NR / NR
AAA

4.82 4.26
TOTAL CMO 9,972,621.58 3.41%
9,854,884.95
9,797,298.27 4.47%
9,643,457.64
23,797.26

3.55%
(153,840.63)
Aaa / AAA
AAA

3.12 2.79
Corporate
69371RR24 Paccar Financial Corp Note

0.350% Due 02/02/2024
420,000.00 01/28/2021

0.39%
419,512.80
419,863.41

96.07 5.22%
403,478.04
240.92

0.15%
(16,385.37)
A1 / A+
NR

0.84 0.81
808513BN4 Charles Schwab Corp Callable Note Cont 2/18/2024

0.750% Due 03/18/2024
605,000.00 03/16/2021

0.77%
604,697.50
604,902.85

95.19 5.96%
575,894.66
163.85

0.21%
(29,008.19)
A2 / A
A

0.97 0.93
89114QCA4 Toronto Dominion Bank Note

2.650% Due 06/12/2024
1,200,000.00 09/23/2019

2.22%
1,222,788.00
1,205,796.25

97.21 5.08%
1,166,524.80
9,628.33

0.43%
(39,271.45)
A1 / A
AA1.201.15
79466LAG9 Salesforce.com Inc Callable Note Cont 7/15/2022

0.625% Due 07/15/2024
1,050,000.00 Various

0.94%
1,041,590.40
1,045,847.85

94.98 4.68%
997,277.40
1,385.41

0.37%
(48,570.45)
A2 / A+
NR

1.29 1.25
78013XZU5 Royal Bank of Canada Note

2.550% Due 07/16/2024
1,250,000.00 Various

2.21%
1,268,710.00
1,255,119.52

96.74 5.18%
1,209,310.00
6,640.63

0.45%
(45,809.52)
A1 / A
AA1.301.24
69371RR40 Paccar Financial Corp Note

0.500% Due 08/09/2024
515,000.00 08/03/2021

0.52%
514,721.90
514,874.14

94.35 4.85%
485,922.07
371.94

0.18%
(28,952.07)
A1 / A+
NR

1.36 1.32
As of March 31, 2023
49 Attachment 1
342
Holdings Report
City of West Sacramento Consolidated Portfolio - Account #10677 CUSIP Security Description Par Value/Units Purchase Date Book Yield
Cost Value
Book Value
Mkt Price
Mkt YTM
Market Value
Accrued Int.
% of Port.

Gain/Loss
Moody/S&P
Fitch
Maturity
Duration
14913Q3B3 Caterpillar Finl Service Note

2.150% Due 11/08/2024
600,000.00 01/28/2020

1.92%
606,282.00
602,114.41

96.35 4.54%
578,095.20
5,124.17

0.21%
(24,019.21)
A2 / A
A

1.61 1.54
74153WCQ0 Pricoa Global Funding Note

1.150% Due 12/06/2024
670,000.00 12/01/2021

1.19%
669,309.90
669,612.06

94.30 4.72%
631,796.60
2,461.32

0.23%
(37,815.46)
Aa3 / AAAA1.69

1.62 89236TJT3 Toyota Motor Credit Corp Note

1.450% Due 01/13/2025
920,000.00 01/10/2022

1.50%
918,767.20
919,265.49

94.67 4.60%
870,941.00
2,890.33

0.32%
(48,324.49)
A1 / A+
A+

1.79 1.72
64952WEK5 New York Life Global Note

1.450% Due 01/14/2025
1,270,000.00 01/11/2022

1.49%
1,268,628.40
1,269,181.55

94.47 4.71%
1,199,782.97
3,938.76

0.44%
(69,398.58)
Aaa / AA+
AAA

1.79 1.72
90331HPL1 US Bank NA Callable Note Cont 12/21/2024

2.050% Due 01/21/2025
1,285,000.00 01/16/2020

2.10%
1,282,262.95
1,284,009.75

94.19 5.47%
1,210,367.20
5,122.15

0.45%
(73,642.55)
A1 / AAAA1.81

1.73 78016EZ59 Royal Bank of Canada Note

3.375% Due 04/14/2025
540,000.00 04/07/2022

3.39%
539,800.20
539,864.37

97.04 4.92%
524,036.52
8,454.38

0.20%
(15,827.85)
A1 / A
AA2.041.91
06406RBC0 Bank of NY Mellon Corp Callable Note Cont 3/25/2025

3.350% Due 04/25/2025
935,000.00 04/19/2022

3.35%
934,869.10
934,909.74

96.30 5.26%
900,430.25
13,573.08

0.34%
(34,479.49)
A1 / A
AA2.071.93
06367WB85 Bank of Montreal Note

1.850% Due 05/01/2025
939,000.00 07/23/2021

0.85%
973,573.98
958,149.05

93.66 5.10%
879,456.13
7,238.13

0.33%
(78,692.92)
A2 / AAA2.09

1.99 46647PCH7 JP Morgan Chase & Co Callable Note Cont 6/1/2024

0.824% Due 06/01/2025
1,120,000.00 05/24/2021

1.93%
1,121,449.85
1,120,785.96

94.76 5.37%
1,061,324.33
3,076.27

0.39%
(59,461.63)
A1 / AAA2.17

2.08 46647PCK0 JP Morgan Chase & Co Callable Note Cont 6/23/2024

0.969% Due 06/23/2025
535,000.00 Various

2.06%
535,334.75
535,186.63

94.73 5.36%
506,807.11
1,411.25

0.19%
(28,379.52)
A1 / AAA2.23

2.13 66815L2J7 Northwestern Mutual Glbl Note

4.000% Due 07/01/2025
800,000.00 06/27/2022

4.01%
799,728.00
799,796.00

98.53 4.69%
788,277.60
8,000.00

0.29%
(11,518.40)
Aaa / AA+
AAA

2.25 2.10
637432NG6 National Rural Utilities Callable Note Cont 8/1/2025

3.250% Due 11/01/2025
700,000.00 04/06/2022

3.21%
701,015.00
700,736.13

96.22 4.82%
673,548.40
9,479.17

0.25%
(27,187.73)
A1 / AA+2.59

2.40 40139LBC6 Guardian Life Glob Fun Note

0.875% Due 12/10/2025
1,100,000.00 Various

1.12%
1,088,890.00
1,092,841.97

90.19 4.80%
992,087.80
2,967.70

0.37%
(100,754.17)
Aa1 / AA+
NR

2.70 2.59
66815L2A6 Northwestern Mutual Glbl Note

0.800% Due 01/14/2026
650,000.00 12/06/2021

1.47%
632,755.50
638,269.60

89.92 4.70%
584,500.80
1,112.22

0.22%
(53,768.80)
Aaa / AA+
AAA

2.79 2.69
46647PBK1 JP Morgan Chase & Co Callable Note Cont 4/22/2025

2.083% Due 04/22/2026
334,000.00 05/20/2021

2.20%
346,468.22
341,763.10

93.57 5.42%
312,534.49
3,072.77

0.12%
(29,228.61)
A1 / AAA3.06

1.95 As of March 31, 2023
50 Attachment 1
343
Holdings Report
City of West Sacramento Consolidated Portfolio - Account #10677 CUSIP Security Description Par Value/Units Purchase Date Book Yield
Cost Value
Book Value
Mkt Price
Mkt YTM
Market Value
Accrued Int.
% of Port.

Gain/Loss
Moody/S&P
Fitch
Maturity
Duration
6174468Q5 Morgan Stanley Callable Note Cont 4/28/2025

2.188% Due 04/28/2026
550,000.00 05/18/2022

4.89%
519,535.50
526,225.41

93.83 5.36%
516,042.45
5,114.45

0.19%
(10,182.96)
A1 / AA+3.08

1.97 023135BX3 Amazon.com Inc Callable Note Cont 4/12/2026

1.000% Due 05/12/2026
1,655,000.00 05/10/2021

1.09%
1,647,850.40
1,650,548.14

90.66 4.23%
1,500,490.86
6,390.14

0.55%
(150,057.28)
A1 / AA
AA3.123.00
91324PEC2 United Health Group Inc Callable Note Cont 4/15/2026

1.150% Due 05/15/2026
275,000.00 Various

1.08%
275,889.15
275,565.11

90.93 4.29%
250,043.75
1,194.72

0.09%
(25,521.36)
A3 / A+
A

3.13 2.99
89236TJK2 Toyota Motor Credit Corp Note

1.125% Due 06/18/2026
1,130,000.00 06/15/2021

1.13%
1,129,502.80
1,129,680.33

90.18 4.44%
1,018,987.67
3,637.19

0.38%
(110,692.66)
A1 / A+
A+

3.22 3.08
06051GJD2 Bank of America Corp Callable Note Cont 6/19/2025

1.319% Due 06/19/2026
1,000,000.00 Various

2.19%
1,002,640.00
1,001,710.13

91.41 5.48%
914,110.00
3,737.16

0.34%
(87,600.13)
A2 / AAA3.22

2.13 57629WDE7 Mass Mutual Global funding Note

1.200% Due 07/16/2026
772,000.00 08/10/2021

1.21%
771,785.72
771,856.83

88.88 4.90%
686,119.64
1,930.00

0.25%
(85,737.19)
Aa3 / AA+
AA+

3.30 3.15
58989V2D5 Met Tower Global Funding Note

1.250% Due 09/14/2026
585,000.00 09/07/2021

1.27%
584,461.80
584,628.03

88.74 4.83%
519,121.98
345.31

0.19%
(65,506.05)
Aa3 / AAAA3.46

3.30 931142ER0 Wal-Mart Stores Callable Note Cont 08/17/2026

1.050% Due 09/17/2026
265,000.00 09/08/2021

1.09%
264,499.15
264,653.03

90.15 4.13%
238,887.96
108.21

0.09%
(25,765.07)
Aa2 / AA
AA

3.47 3.33
26442CAS3 Duke Energy Carolinas Callable Note Cont 9/1/2026

2.950% Due 12/01/2026
1,355,000.00 10/28/2022

4.89%
1,258,727.25
1,268,477.21

94.42 4.62%
1,279,442.49
13,324.17

0.48%
10,965.28
Aa3 / A
NR

3.67 3.38
59217GER6 Metlife Note

1.875% Due 01/11/2027
845,000.00 01/03/2022

1.90%
844,036.70
844,271.46

89.36 5.00%
755,070.88
3,520.83

0.28%
(89,200.58)
Aa3 / AAAA3.79

3.55 61747YEZ4 Morgan Stanley Callable Note 1X 1/28/2026

5.050% Due 01/28/2027
610,000.00 01/17/2023

5.29%
611,063.70
611,011.60

99.72 5.15%
608,296.88
6,161.00

0.23%
(2,714.72)
A1 / AA+3.83

2.58 808513BY0 Charles Schwab Corp Callable Note Cont 2/3/2027

2.450% Due 03/03/2027
725,000.00 03/01/2022

2.46%
724,796.70
724,840.57

89.57 5.44%
649,387.58
1,381.53

0.24%
(75,452.99)
A2 / A
A

3.93 3.65
084664CZ2 Berkshire Hathaway Callable Note Cont 2/15/2027

2.300% Due 03/15/2027
1,225,000.00 03/07/2022

2.30%
1,224,767.25
1,224,815.94

94.68 3.76%
1,159,803.05
1,252.22

0.43%
(65,012.89)
Aa2 / AA
A+

3.96 3.72
06051GHT9 Bank of America Corp Callable Note 1X 4/23/2026

3.559% Due 04/23/2027
750,000.00 Various

4.85%
726,688.38
729,903.88

94.98 5.35%
712,351.50
11,715.04

0.27%
(17,552.38)
A2 / AAA4.07

2.80 As of March 31, 2023
51 Attachment 1
344
Holdings Report
City of West Sacramento Consolidated Portfolio - Account #10677 CUSIP Security Description Par Value/Units Purchase Date Book Yield
Cost Value
Book Value
Mkt Price
Mkt YTM
Market Value
Accrued Int.
% of Port.

Gain/Loss
Moody/S&P
Fitch
Maturity
Duration
665859AW4 Northern Trust Company Callable Note Cont 4/10/2027

4.000% Due 05/10/2027
455,000.00 05/05/2022

4.04%
454,262.90
454,394.50

97.97 4.55%
445,742.57
7,128.33

0.17%
(8,651.93)
A2 / A+
A+

4.11 3.68
91324PEG3 United Health Group Inc Callable Note Cont 4/15/2027

3.700% Due 05/15/2027
465,000.00 05/17/2022

3.69%
465,220.50
465,182.24

97.81 4.28%
454,832.78
6,499.67

0.17%
(10,349.46)
A3 / A+
A

4.13 3.72
61747YEC5 Morgan Stanley Callable Note Cont 7/20/2026

1.512% Due 07/20/2027
750,000.00 10/28/2022

6.03%
637,425.00
647,296.56

88.87 5.22%
666,505.50
2,236.50

0.25%
19,208.94
A1 / AA+4.31

3.14 14913R3A3 Caterpillar Financial Service Note

3.600% Due 08/12/2027
1,000,000.00 11/02/2022

5.06%
938,730.00
943,935.49

97.84 4.14%
978,439.00
4,900.00

0.36%
34,503.51
A2 / A
A

4.37 3.97
756109BG8 Realty Income Corp Calllable Note Cont 5/15/2027

3.950% Due 08/15/2027
1,425,000.00 Various

5.42%
1,337,997.25
1,345,227.14

96.35 4.89%
1,372,960.43
7,192.29

0.51%
27,733.29
A3 / ANR4.38

3.94 57636QAW4 MasterCard Inc Callable Note Cont 2/9/28

4.875% Due 03/09/2028
775,000.00 03/06/2023

4.90%
774,248.25
774,257.71
102.92

4.20%
797,662.55
2,308.85

0.29%
23,404.84
Aa3 / A+
NR

4.95 4.29
TOTAL Corporate 34,050,000.00 2.53%
33,685,284.05
33,691,371.14 4.85%
32,076,692.89
186,430.39

11.86%
(1,614,678.25)
A1 / A+
AA2.792.51
LAIF
90LAIF$00 Local Agency Investment Fund State Pool 100,959,757.36 Various

2.88%
100,959,757.36
100,959,757.36

1.00 2.88%
100,959,757.36
647,784.77

37.36%

0.00 NR / NR
NR

0.00 0.00
TOTAL LAIF 100,959,757.36 2.88%
100,959,757.36
100,959,757.36 2.88%
100,959,757.36
647,784.77

37.36%

0.00 NR / NR
NR

0.00 0.00
Local Gov Investment Pool
90CAMP$00 California Asset Mgmt Program CAMP 5,269,627.21 Various

4.92%
5,269,627.21
5,269,627.21

1.00 4.92%
5,269,627.21

0.00 1.94%

0.00 NR / AAA
NR

0.00 0.00
TOTAL Local Gov Investment Pool 5,269,627.21 4.92%
5,269,627.21
5,269,627.21 4.92%
5,269,627.21

0.00 1.94%

0.00 NR / AAA
NR

0.00 0.00
As of March 31, 2023
52 Attachment 1
345
Holdings Report
City of West Sacramento Consolidated Portfolio - Account #10677 CUSIP Security Description Par Value/Units Purchase Date Book Yield
Cost Value
Book Value
Mkt Price
Mkt YTM
Market Value
Accrued Int.
% of Port.

Gain/Loss
Moody/S&P
Fitch
Maturity
Duration
Money Market Fund
262006208 Dreyfus Gov't Cash Management Money Market Fund #289
503,569.77 Various

4.70%
503,569.77
503,569.77

1.00 4.70%
503,569.77

0.00 0.19%

0.00 Aaa / AAA
NR

0.00 0.00
TOTAL Money Market Fund 503,569.77 4.70%
503,569.77
503,569.77 4.70%
503,569.77

0.00 0.19%

0.00 Aaa / AAA
NR

0.00 0.00
Municipal Bonds
13063DRK6 California State Taxable GO

2.400% Due 10/01/2024
730,000.00 10/16/2019

1.91%
746,768.10
735,102.93

96.96 4.52%
707,829.90
8,760.00

0.26%
(27,273.03)
Aa2 / AAAA1.51

1.43 TOTAL Municipal Bonds 730,000.00 1.91%
746,768.10
735,102.93 4.52%
707,829.90
8,760.00

0.26%
(27,273.03)
Aa2 / AAAA1.51

1.43 Negotiable CD
33715LCB4 First Technology Federal Negotiable CD

3.400% Due 08/17/2023
248,000.00 08/17/2018

3.40%
248,000.00
248,000.00

99.39 5.03%
246,480.50
346.52

0.09%
(1,519.50)

NR / NR
NR

0.38 0.38
TOTAL Negotiable CD 248,000.00 3.40%
248,000.00
248,000.00 5.03%
246,480.50
346.52

0.09%
(1,519.50)

NR / NR
NR

0.38 0.38
Supranational
459058JL8 Intl. Bank Recon & Development Note

0.500% Due 10/28/2025
2,150,000.00 Various

0.60%
2,140,429.05
2,144,758.44

91.64 3.95%
1,970,174.00
4,568.76

0.73%
(174,584.44)
Aaa / AAA
AAA

2.58 2.51
4581X0DV7 Inter-American Dev Bank Note

0.875% Due 04/20/2026
2,175,000.00 04/13/2021

0.97%
2,165,038.50
2,168,917.27

91.35 3.91%
1,986,836.40
8,511.20

0.73%
(182,080.87)
Aaa / AAA
AAA

3.06 2.95
TOTAL Supranational 4,325,000.00 0.78%
4,305,467.55
4,313,675.71 3.93%
3,957,010.40
13,079.96

1.46%
(356,665.31)
Aaa / AAA
AAA

2.82 2.73
US Treasury
91282CBR1 US Treasury Note

0.250% Due 03/15/2024
1,000,000.00 03/30/2021

0.33%
997,578.13
999,217.38

95.94 4.64%
959,414.00
115.49

0.35%
(39,803.38)
Aaa / AA+
AAA

0.96 0.93
912828X70 US Treasury Note

2.000% Due 04/30/2024
1,500,000.00 09/25/2019

1.62%
1,525,078.12
1,505,903.37

97.25 4.63%
1,458,808.50
12,596.69

0.54%
(47,094.87)
Aaa / AA+
AAA

1.08 1.04
912828XX3 US Treasury Note

2.000% Due 06/30/2024
2,000,000.00 09/30/2019

1.60%
2,036,562.50
2,009,609.51

97.03 4.46%
1,940,626.00
10,055.25

0.72%
(68,983.51)
Aaa / AA+
AAA

1.25 1.21
912828D56 US Treasury Note

2.375% Due 08/15/2024
2,000,000.00 09/18/2019

1.71%
2,062,578.13
2,017,530.26

97.34 4.39%
1,946,718.00
5,904.70

0.72%
(70,812.26)
Aaa / AA+
AAA

1.38 1.33
As of March 31, 2023
53 Attachment 1
346
Holdings Report
City of West Sacramento Consolidated Portfolio - Account #10677 CUSIP Security Description Par Value/Units Purchase Date Book Yield
Cost Value
Book Value
Mkt Price
Mkt YTM
Market Value
Accrued Int.
% of Port.

Gain/Loss
Moody/S&P
Fitch
Maturity
Duration
9128283D0 US Treasury Note

2.250% Due 10/31/2024
2,000,000.00 11/07/2019

1.77%
2,045,234.38
2,014,398.41

96.91 4.29%
1,938,126.00
18,895.03

0.72%
(76,272.41)
Aaa / AA+
AAA

1.59 1.52
91282CDS7 US Treasury Note

1.125% Due 01/15/2025
1,000,000.00 02/02/2022

1.36%
993,125.00
995,818.83

94.77 4.18%
947,695.00
2,361.88

0.35%
(48,123.83)
Aaa / AA+
AAA

1.80 1.74
912828ZC7 US Treasury Note

1.125% Due 02/28/2025
2,000,000.00 03/18/2020

0.81%
2,030,859.38
2,011,937.30

94.55 4.11%
1,891,094.00
1,956.52

0.70%
(120,843.30)
Aaa / AA+
AAA

1.92 1.86
912828ZF0 US Treasury Note

0.500% Due 03/31/2025
2,000,000.00 05/28/2020

0.35%
2,014,140.63
2,005,841.91

93.27 4.04%
1,865,390.00

27.32 0.69%
(140,451.91)
Aaa / AA+
AAA

2.00 1.95
912828XB1 US Treasury Note

2.125% Due 05/15/2025
1,000,000.00 04/06/2022

2.78%
980,742.19
986,838.80

96.13 4.04%
961,328.00
8,042.13

0.36%
(25,510.80)
Aaa / AA+
AAA

2.13 2.03
91282CAB7 US Treasury Note

0.250% Due 07/31/2025
1,100,000.00 03/12/2021

0.72%
1,077,828.13
1,088,186.10

91.83 3.94%
1,010,152.00
455.80

0.37%
(78,034.10)
Aaa / AA+
AAA

2.34 2.29
91282CFP1 US Treasury Note

4.250% Due 10/15/2025
2,400,000.00 10/28/2022

4.37%
2,392,031.25
2,393,152.78
100.77

3.93%
2,418,561.60
47,076.92

0.91%
25,408.82
Aaa / AA+
AAA

2.55 2.34
91282CAT8 US Treasury Note

0.250% Due 10/31/2025
400,000.00 03/12/2021

0.79%
390,265.63
394,565.79

91.18 3.87%
364,703.20
419.89

0.13%
(29,862.59)
Aaa / AA+
AAA

2.59 2.52
91282CFW6 US Treasury Note

4.500% Due 11/15/2025
2,400,000.00 11/10/2022

4.27%
2,415,656.25
2,413,699.22
101.48

3.90%
2,435,438.40
40,872.93

0.91%
21,739.18
Aaa / AA+
AAA

2.63 2.42
91282CAZ4 US Treasury Note

0.375% Due 11/30/2025
1,250,000.00 03/26/2021

0.77%
1,227,587.89
1,237,211.84

91.22 3.87%
1,140,235.00
1,571.09

0.42%
(96,976.84)
Aaa / AA+
AAA

2.67 2.60
91282CCW9 US Treasury Note

0.750% Due 08/31/2026
530,000.00 09/23/2021

0.90%
526,252.73
527,404.78

90.38 3.78%
478,987.50
345.65

0.18%
(48,417.28)
Aaa / AA+
AAA

3.42 3.31
91282CCZ2 US Treasury Note

0.875% Due 09/30/2026
1,060,000.00 10/18/2021

1.19%
1,044,141.41
1,048,784.02

90.56 3.78%
959,962.50

25.34 0.35%
(88,821.52)
Aaa / AA+
AAA

3.50 3.39
91282CDG3 US Treasury Note

1.125% Due 10/31/2026
1,060,000.00 11/15/2021

1.25%
1,053,540.63
1,055,325.97

91.21 3.77%
966,794.20
5,007.18

0.36%
(88,531.77)
Aaa / AA+
AAA

3.59 3.44
912828YQ7 US Treasury Note

1.625% Due 10/31/2026
2,400,000.00 11/02/2022

4.43%
2,156,250.00
2,181,159.98

92.89 3.76%
2,229,468.00
16,375.69

0.83%
48,308.02
Aaa / AA+
AAA

3.59 3.40
91282CET4 US Treasury Note

2.625% Due 05/31/2027
600,000.00 06/13/2022

3.41%
578,718.75
582,136.43

95.88 3.70%
575,296.80
5,278.85

0.21%
(6,839.63)
Aaa / AA+
AAA

4.17 3.86
91282CEW7 US Treasury Note

3.250% Due 06/30/2027
1,500,000.00 Various

3.40%
1,490,273.44
1,491,043.67

98.27 3.69%
1,474,101.00
12,254.83

0.55%
(16,942.67)
Aaa / AA+
AAA

4.25 3.90
91282CFB2 US Treasury Note

2.750% Due 07/31/2027
1,180,000.00 Various

3.00%
1,166,739.07
1,168,403.49

96.30 3.68%
1,136,395.46
5,378.45

0.42%
(32,008.03)
Aaa / AA+
AAA

4.34 4.02
91282CFH9 US Treasury Note

3.125% Due 08/31/2027
3,500,000.00 Various

3.28%
3,474,796.89
3,477,611.70

97.81 3.67%
3,423,437.50
9,510.87

1.26%
(54,174.20)
Aaa / AA+
AAA

4.42 4.07
As of March 31, 2023
54 Attachment 1
347
Holdings Report
City of West Sacramento Consolidated Portfolio - Account #10677 CUSIP Security Description Par Value/Units Purchase Date Book Yield
Cost Value
Book Value
Mkt Price
Mkt YTM
Market Value
Accrued Int.
% of Port.

Gain/Loss
Moody/S&P
Fitch
Maturity
Duration
91282CFU0 US Treasury Note

4.125% Due 10/31/2027
2,400,000.00 11/03/2022

4.42%
2,368,968.75
2,371,489.40
101.92

3.67%
2,446,032.00
41,569.06

0.91%
74,542.60
Aaa / AA+
AAA

4.59 4.08
91282CGC9 US Treasury Note

3.875% Due 12/31/2027
700,000.00 01/25/2023

3.57%
709,679.69
709,330.15
101.05

3.63%
707,355.60
6,818.72

0.26%
(1,974.55)
Aaa / AA+
AAA

4.76 4.27
91282CGH8 US Treasury Note

3.500% Due 01/31/2028
1,000,000.00 03/14/2023

3.90%
982,578.13
982,724.86

99.48 3.62%
994,766.00
5,801.10

0.37%
12,041.14
Aaa / AA+
AAA

4.84 4.39
91282CGP0 US Treasury Note

4.000% Due 02/29/2028
2,900,000.00 02/23/2023

4.16%
2,879,269.53
2,879,632.63
101.71

3.62%
2,949,616.10
10,086.96

1.09%
69,983.47
Aaa / AA+
AAA

4.92 4.42
TOTAL US Treasury 40,880,000.00 2.61%
40,620,476.63
40,548,958.58 3.94%
39,620,502.36
268,804.34

14.67%
(928,456.22)
Aaa / AA+
AAA

3.03 2.81
TOTAL PORTFOLIO 276,463,120.09 2.22%
275,773,078.74
275,574,340.63 3.21%
270,767,237.38
1,214,391.30
100.00%
(4,807,103.25)
Aa1 / AA
AAA

1.23 1.06
TOTAL MARKET VALUE PLUS ACCRUALS 271,981,628.68
As of March 31, 2023
55 Attachment 1
348
Attachment 2
1 CITY OF WEST SACRAMENTO
ADMINISTRATIVE POLICY NUMBER: IV-C-2
DATE: September 8, 1992
Revised: February 1, 1999
Revised: October 15, 2014
Revised: November 1, 2017
Revised: August 21, 2019
Revised: June 16, 2021
Revised: June 7May 17,
2023
SUBJECT: INVESTMENT POLICY AUTHORITY: City Council

PURPOSE
This policy sets forth the procedural regulations for investing surplus funds. The intent of the Investment Policy of the City of West Sacramento is to define the parameters within which funds are to be managed.

POLICY
In methods, procedures, and practices, the policy formalizes the framework for the City’s investment activities that must be exercised to ensure effective and judicious fiscal and investment management of the City’s funds. The guidelines are intended to be broad enough to allow the investment officer to function properly within the parameters of responsibility and authority, yet specific enough to safeguard the investment assets.

PROCEDURE
A. SCOPE
This policy applies to the investment of surplus operating and capital funds and proceeds from certain bond issues. It conforms to best practices as outlined by Government Finance Officers Association, Association of Public Treasurers of the United States and Canada, and California Municipal Treasurers’ Association.

1. Pooling of Funds: Except for cash in certain restricted and special funds, the City will consolidate cash balances from all funds to maximize investment earnings. Investment income will be allocated to the various funds based on their respective participation and in accordance with generally accepted accounting principles.

B. GENERAL OBJECTIVES
The primary objectives, in priority order, of investment activities shall be safety, liquidity, and return.

1. Safety: Safety of principal is the foremost objective of the investment program.

Investments shall be undertaken in a manner that seeks to ensure the preservation of capital in the overall portfolio. To attain this objective, the City will diversify its investments by investing funds among a variety of securities with independent returns. The objective will be to mitigate credit risk and market risk, further explained below. 349
Administrative Policy IV-C-2
Investment Policy
(continued)
2 2. Liquidity: The investment portfolio shall remain sufficiently liquid to meet all operating requirements that may be reasonably anticipated. This is accomplished by structuring the portfolio so that securities mature concurrent with cash needs to meet anticipated demands (static liquidity). Furthermore, since all possible cash demands cannot be anticipated, the portfolio should consist largely of securities with active secondary or resale markets (dynamic liquidity). A portion of the portfolio also may be placed in money market mutual funds or local government investment pools which offer same-day liquidity for short-term funds.

3. Return: The investment portfolio shall be designed with the objective of attaining a market rate of return throughout budgetary and economic cycles, taking into account the investment risk constraints and liquidity needs. Return on investment is of secondary importance compared to the safety and liquidity objectives described above. The core of investments are limited to relatively low risk securities in anticipation of earning a fair return relative to the risk being assumed.

C. STANDARDS OF CARE

1. Prudence: The standard of prudence to be used by investment officials shall be the “prudent investor” standard (California Government Code section 53600.3) and shall be applied in the context of managing an overall portfolio. Pursuant to this section of Code, all persons authorized to make investment decisions on behalf of the City are trustees and therefore fiduciaries subject to the Prudent Investor Standard:
“…all governing bodies of local agencies or persons authorized to make investment decisions on behalf of those local agencies investing public funds pursuant to this chapter are trustees and therefore fiduciaries subject to the prudent investor standard. When investing, reinvesting, purchasing, acquiring, exchanging, selling, or managing public funds, a trustee shall act with care, skill, prudence, and diligence under the circumstances then prevailing, including, but not limited to, the general economic conditions and the anticipated needs of the Agency, that a prudent person acting in a like capacity and familiarity with those matters would use in the conduct of funds of a like character and with like aims, to safeguard the principal and maintain the liquidity needs of the Agency. Within the limitations of this section and considering individual investments as part of an overall strategy, investments may be acquired as authorized by law.” Investment officers acting in accordance with written procedures and this investment policy and exercising due diligence shall be relieved of personal responsibility for an individual security’s credit risk or market price changes, provided deviations from expectations are reported in a timely fashion and the liquidity and the sale of securities are carried out in accordance with the terms of this policy.

2. Ethics and Conflicts of Interest: Officers and employees involved in the investment process shall refrain from personal business activity that could conflict with the proper execution and management of the investment program, or that could impair their ability to make impartial decisions. Employees and investment officials shall disclose any material interests in financial institutions with which they conduct business. They shall further disclose any personal financial/ investment positions that could be related to the performance of the investment portfolio. Employees and officers shall refrain from undertaking personal investment transactions with the same individual with whom business is conducted on behalf of the City.

3. Delegation of Authority: Authority to manage the investment program is granted to the Director of Finance/City Treasurer, hereinafter referred to as investment officer, and derived from California Government Code, Sections 41006 and 53600 et seq as well as Ordinance 87-12. Responsibility for the operation of the investment program is hereby 350
Administrative Policy IV-C-2
Investment Policy
(continued)
3 delegated to the investment officer, who shall act in accordance with established written procedures and internal controls for the operation of the investment program consistent with this investment policy. Procedures should include references to: safekeeping, delivery vs. payment, investment accounting, repurchase agreements, wire transfer agreements, and collateral/depository agreements. No person may engage in an investment transaction except as provided under the terms of this policy and the procedures established by the investment officer. The investment officer shall be responsible for all transactions undertaken and shall establish a system of controls to regulate the activities of subordinate officials. The City may engage the services of one or more external investment advisers, who are registered under the Investment Advisers Act of 1940, to assist in the management of the City’s investment portfolio in a manner consistent with the City’s objectives. External investment advisers may be granted discretion to purchase and sell investment securities in accordance with this investment policy.

The City’s overall investment program shall be designed and managed with a degree of professionalism that is worthy of the public trust. The City recognizes that in a diversified portfolio, occasional measured losses may be inevitable and must be considered within the context of the overall portfolio’s return and the cash flow requirements of the City.

D. SAFEKEEPING AND CUSTODY

1. Authorized Financial Dealers and Institutions: To the extent practicable, the investment officer shall endeavor to complete investment transactions using a competitive bid process whenever possible. The investment officer will determine which financial institutions are authorized to provide investment services to the City. It shall be the City’s policy to purchase securities only from authorized institutions and firms. A list will be maintained of financial institutions authorized to provide investment services. In addition, a list also will be maintained of approved security broker/dealers selected by creditworthiness (e.g., a minimum capital requirement of $10,000,000 and at least five years of operation). These may include “primary” dealers or regional dealers that qualify under Securities and Exchange Commission (SEC) Rule 15C3-1 (uniform net capital rule).

In accordance with Section 53601.5, institutions eligible to transact investment business with the City include:
 Primary government dealers as designated by the Federal Reserve Bank and nonprimary government dealers.  Nationally or state-chartered banks.
 The Federal Reserve Bank.
 Direct issuers of securities eligible for purchase.

Selection of financial institutions and broker/dealers authorized to engage in transactions will be at the sole discretion of the City, except where the City utilizes an external investment adviser in which case the City may rely on the adviser for selection.

All financial institutions and broker/dealers who desire to become qualified for investment transactions must supply the following as appropriate:
 Audited financial statements.
 Proof of National Association of Securities Dealers (NASD) certification.  Proof of state registration.
351
Administrative Policy IV-C-2
Investment Policy
(continued)
4  Completed broker/dealer questionnaire.
 Certification of having read and understood and agreeing to comply with the City’s investment policy.
 Evidence of adequate insurance coverage.

An annual review of the financial condition and registration of qualified financial institutions and broker/dealers will be conducted by the investment officer.

From time to time, the investment officer may choose to invest in instruments offered by minority and community financial institutions. In such instances, a waiver to the criteria under Paragraph 1 may be granted. All terms and relationships will be fully disclosed prior to purchase and will be reported to the appropriate entity on a consistent basis and should be consistent with state or local law. These types of investment purchases should be approved by the appropriate legislative or governing body in advance.

Public deposits will be made only in qualified public depositories as established by State law. Deposits will be insured by the Federal Deposit Insurance Corporation, or, to the extent the amount exceeds the insured maximum, will be collateralized in accordance with State law.

Selection of broker/dealers used by an external investment adviser retained by the City will be at the sole discretion of the adviser. Where possible, transactions with broker/dealers shall be selected on a competitive basis and their bid or offering prices shall be recorded. If there is no other readily available competitive offering, best efforts will be made to document quotations for comparable or alternative securities. When purchasing original issue instrumentality securities, no competitive offerings will be required as all dealers in the selling group offer those securities at the same original issue price.

2. Internal Controls: The investment officer is responsible for establishing and maintaining an internal control structure designed to ensure that the assets of the City are protected from loss, theft or misuse. Specifics for the internal controls shall be documented in an investment procedures manual that shall be reviewed and updated periodically by the Investment Officer. An example of such a procedure would include the requirement that the Director of Finance approve trades transacted by other authorized personnel. The internal control structure shall be designed to provide reasonable assurance that these objectives are met. The concept of reasonable assurance recognizes that (1) the cost of a control should not exceed the benefits likely to be derived and (2) the valuation of costs and benefits requires estimates and judgments by management.

Accordingly, the investment officer shall establish a process for an annual independent review by an external auditor to assure compliance with policies and procedures. The internal controls shall address the following points:
 Control of collusion.
 Separation of transaction authority from accounting and recordkeeping.  Custodial safekeeping.
 Avoidance of physical delivery securities.
352
Administrative Policy IV-C-2
Investment Policy
(continued)
5  Clear designation of authority to subordinate staff members.  Written confirmation of transactions for investments and wire transfers.  Dual authorizations of wire transfers.
 Staff training.
 Development of a wire transfer agreement with the lead bank and third-party custodian.

3. Delivery vs. Payment: All trades where applicable will be executed by delivery vs. payment (DVP) to ensure that securities are deposited in an eligible financial institution prior to the release of funds. Securities will be held by a third-party custodian as evidenced by safekeeping receipts. The only exception to the foregoing shall be depository accounts and securities purchase made with: Local Agency Investment Fund (LAIF), California Asset Management Program, time certificates of deposit and money market mutual funds, since the purchased securities are not deliverable.

4. Third-Party Safekeeping: Securities will be held by an independent third-party safekeeping institution selected by the City. All securities will be evidenced by safekeeping receipts in the City’s name. The safekeeping institution shall annually provide a copy of its most recent report on internal controls – Service Organization Control Reports (formerly 70, or SAS 70) prepared in accordance with the Statements of Standards for Attestation Engagements (SSAE) No. 16 (effective June 15, 2011).

E. SUITABLE AND AUTHORIZED INVESTMENTS

1. Investment Types: Investments shall be placed to conform to those allowable under the State of California Government Code section 53600 et seq. Within the investments permitted by the Code, the City seeks to further restrict eligible investments to the guidelines listed below. Consistent with the GFOA Policy Statement and Local Laws Concerning Investment Practices, the following investments will be permitted by this policy and are those defined by state and local law where applicable. If additional types of securities are approved for investment by public funds by state statute, they will not be eligible for investment by the City until this Policy has been amended and the amended version adopted by the City Council. In the event a discrepancy is found between this policy and the Code, the more restrictive parameters will take precedence. Percentage holding limits and minimum credit quality requirements listed in this section apply at the time the security is purchased.

Any investment currently held at the time the policy is adopted which does not meet the new policy guidelines can be held until maturity and shall be exempt from the current policy. At the time of the investment’s maturity or liquidation, such funds shall be reinvested only as provided in the current policy.

An appropriate risk level shall be maintained by primarily purchasing securities that are of high quality, liquid, and marketable. The portfolio shall be diversified by security type and institution to avoid incurring unreasonable and avoidable risks regarding specific security types or individual issuers.

Authorized securities include:
353
Administrative Policy IV-C-2
Investment Policy
(continued)
6 A. Municipal Securities include obligations of the City, the State of California and any local agency within the State of California, provided that:
 The securities are rated in a rating category of “A” or its equivalent or better by at least one nationally recognized statistical rating organization (“NRSRO”).  No more than 5% of the portfolio may be invested in any single issuer.  No more than 30% of the portfolio may be in Municipal Securities.  The maximum maturity does not exceed five (5) years.

B. Municipal Securities (Registered Treasury Notes or Bonds) of any of the other 49 states in addition to California, including bonds payable solely out of the revenues from a revenue-producing property owned, controlled, or operated by a state or by a department, board, agency, or authority of any of the other 49 states, in addition to California.
 The securities are rated in a rating category of “A” or its equivalent or better by at least one nationally recognized statistical rating organization (“NRSRO”).  No more than 5% of the portfolio may be invested in any single issuer.  No more than 30% of the portfolio may be in Municipal Securities.  The maximum maturity does not exceed five (5) years.

C. U.S. Treasuries and other government obligations for which the full faith and credit of the United States are pledged for the payment of principal and interest. There are no limits on the dollar amount or percentage that the City may invest in U.S. Treasuries, provided that:
 The maximum maturity is five (5) years.

D. Federal Agencies or United States Government-Sponsored Enterprise obligations, participations, or other instruments, including those issued by or fully guaranteed as to principal and interest by federal agencies or United States government-sponsored enterprises. There are no limits on the dollar amount or percentage that the City may invest in Federal Agency or Government-Sponsored Enterprises (GSEs), provided that:
 No more than 30% of the portfolio may be invested in any single Agency/GSE issuer.
 The maximum maturity does not exceed five (5) years.
 The maximum percent of agency callable securities in the portfolio will be 20%.

E. Banker’s Acceptances, provided that:
 They are issued by institutions which have short-term debt obligations rated “A-1” or its equivalent or better by at least one NRSRO; or long-term debt obligations which are rated in a rating category of “A” or its equivalent or better by at least one NRSRO.
 No more than 40% of the portfolio may be invested in Banker’s Acceptances.  No more than 5% of the portfolio may be invested in any single issuer.  The maximum maturity does not exceed 180 days.
354
Administrative Policy IV-C-2
Investment Policy
(continued)
7 F. Commercial Paper, provided that the securities are issued by an entity that meets all of the following conditions in either paragraph (a) or (b) and other requirements specified below:
i. SECURITIES issued by corporations:

1. A corporation organized and operating in the United States with assets more than $500 million.

2. The securities are rated “A-1” or its equivalent or better by at least one NRSRO.

3. If the issuer has other debt obligations, they must be rated in a rating category of “A” or its equivalent or better by at least one NRSRO. ii. SECURITIES issued by other entities:

1. The issuer is organized within the United States as a special purpose corporation, trust, or limited liability company.

2. The securities must have program-wide credit enhancements including, but not limited to, overcollateralization, letters of credit, or a surety bond.

3. The securities are rated “A-1” or its equivalent or better by at least one NRSRO.  City may purchase no more than 10% of the outstanding commercial paper of any single issuer.
 No more than 25% of the portfolio may be invested in Commercial Paper. Under a provision sunsetting on January 1, 2026, no more than 40% of the portfolio may be invested in Commercial Paper if the Agency’s investment assets under management are greater than $100,000,000.
 No more than 5% of the portfolio may be invested in any single issuer.  The maximum maturity does not exceed 270 days.

G. Negotiable Certificates of Deposit (NCDs), issued by a nationally or state-chartered bank, a savings association or a federal association, a state or federal credit union, or by a federally licensed or state-licensed branch of a foreign bank, provided that:
 The amount of the NCD insured up to the FDIC limit does not require any credit ratings.
 Any amount above the FDIC insured limit must be issued by institutions which have short-term debt obligations rated “A-1” or its equivalent or better by at least one NRSRO; or long-term obligations rated in a rating category of “A” or its equivalent or better by at least one NRSRO.
 No more than 30% of the total portfolio may be invested in NCDs (combined with CDARS).
 No more than 5% of the portfolio may be invested in any single issuer.  The maximum maturity does not exceed five (5) years.

H. Federally Insured Time Deposits (Non-Negotiable Certificates of Deposit) in state or federally chartered banks, savings and loans, or credit unions, provided that:
355
Administrative Policy IV-C-2
Investment Policy
(continued)
8  The amount per institution is limited to the maximum covered under federal insurance.
 No more than 20% of the portfolio will be invested in a combination of federally insured and collateralized time deposits.
 The maximum maturity does not exceed five (5) years.

I. Collateralized Time Deposits (Non-Negotiable Certificates of Deposit) in state or federally chartered banks, savings and loans, or credit unions in excess of insured amounts which are fully collateralized with securities in accordance with California law, provided that:
 No more than 20% of the portfolio will be invested in a combination of federally insured and collateralized time deposits.
 The maximum maturity does not exceed five (5) years.

J. Certificate of Deposit Placement Service (CDARS), provided that:
 No more than 30% of the total portfolio may be invested in a combination of Certificates of Deposit, including CDARS.
 The maximum maturity does not exceed five (5) years.

K. Collateralized Bank Deposits. City’s deposits with financial institutions will be collateralized with pledged securities per California Government Code, Section 53651.

There are no limits on the dollar amount or percentage that the City may invest in collateralized bank deposits.

L. Repurchase Agreements collateralized with securities authorized under California Government Code, maintained at a level of at least 102% of the market value of the Repurchase Agreement. There are no limits on the dollar amount or percentage that the City may invest, provided that:
 Securities used as collateral for Repurchase Agreements will be delivered to an acceptable third-party custodian.
 Repurchase Agreements are subject to a Master Repurchase Agreement between the City and the provider of the repurchase agreement. The Master Repurchase Agreement will be substantially in the form developed by the Securities Industry and Financial Markets Association (SIFMA).
 The maximum maturity does not exceed one (1) year.

M. State of California Local Agency Investment Fund (LAIF), provided that:
 The City may invest up to the maximum amount permitted by LAIF.  LAIF’s investments in instruments prohibited by or not specified in the City’s policy do not exclude the investment in LAIF itself from the City’s list of allowable investments, provided LAIF’s reports allow the investment officer to adequately judge the risk inherent in LAIF’s portfolio.

N. Local Government Investment Pools
356
Administrative Policy IV-C-2
Investment Policy
(continued)
9  Other LGIPs permitted by client.
 There is no issuer limitation for Local Government Investment Pools O. Corporate Medium-Term Notes (MTNs), provided that:
 The issuer is a corporation organized and operating within the United States or by depository institutions licensed by the United States or any state and operating within the United States.
 The securities are rated in a rating category of “A” or its equivalent or better by at least one NRSRO.
 No more than 30% of the total portfolio may be invested in MTNs.  No more than 5% of the portfolio may be invested in any single issuer.  The maximum maturity does not exceed five (5) years.

P. Asset-Backed, Mortgage-Backed, Mortgage Pass-Through Securities, and Collateralized Mortgage Obligations from issuers not defined in sections C and D of the Authorized Investments section of this policy, provided that:
 The securities are rated in a rating category of “AA” or its equivalent or better by a NRSRO.
 No more than 20% of the total portfolio may be invested in these securities.  No more than 5% of the portfolio may be invested in any single Asset-Backed or Commercial Mortgage security issuer.
 The maximum legal final maturity does not exceed five (5) years.

Q. Mutual Funds and Money Market Mutual Funds that are registered with the Securities and Exchange Commission under the Investment Company Act of 1940, provided that:
a. Mutual Funds that invest in the securities and obligations as authorized under California Government Code, Section 53601 (a) to (k) and (m) to (q) inclusive and that meet either of the following criteria:
(i) Attained the highest ranking or the highest letter and numerical rating provided by not less than two (2) NRSROs; or
(ii) Have retained an investment adviser registered or exempt from registration with the Securities and Exchange Commission with not less than five years’ experience investing in the securities and obligations authorized by California Government Code, Section 53601 and with assets under management in excess of $500 million.
 No more than 10% of the total portfolio may be invested in shares of any one mutual fund.
b. Money Market Mutual Funds registered with the Securities and Exchange Commission under the Investment Company Act of 1940 and issued by diversified management companies and meet either of the following criteria:
(i) Have attained the highest ranking or the highest letter and numerical rating provided by not less than two (2) NRSROs; or
357
Administrative Policy IV-C-2
Investment Policy
(continued)
10 (ii) Have retained an investment adviser registered or exempt from registration with the Securities and Exchange Commission with not less than five years’ experience managing money market mutual funds with assets under management in excess of $500 million.
 No more than 20% of the total portfolio may be invested in the shares of any one Money Market Mutual Fund.
c. No more than 20% of the total portfolio may be invested in these securities.

R. Supranationals, provided that:
 Issues are US dollar denominated senior unsecured unsubordinated obligations issued or unconditionally guaranteed by the International Bank for Reconstruction and Development, International Finance Corporation, or Inter-American Development Bank.
 The securities are rated in a rating category of “AA” or its equivalent or better by a NRSRO.
 No more than 30% of the total portfolio may be invested in these securities.  No more than 10% of the portfolio may be invested in any single issuer.  The maximum maturity does not exceed five (5) years.

2. Prohibited Investment Vehicles and Practices:
 State law notwithstanding, any investments not specifically described herein are prohibited, including, but not limited to futures and options.  In accordance with Government Code, Section 53601.6, investment in inverse floaters, range notes, or mortgage derived interest-only strips is prohibited.  Investment in any security that could result in a zero-interest accrual if held to maturity is prohibited. Investment in any security that could result in a zero interest accrual if held to maturity is prohibited Under a provision sunsetting on January 1, 2026, securities backed by the U.S. Government that could result in a zero- or negativeinterest accrual if held to maturity are permitted.  Trading securities for the sole purpose of speculating on the future direction of interest rates is prohibited.
 Purchasing or selling securities on margin is prohibited.  The use of reverse repurchase agreements, securities lending or any other form of borrowing or leverage is prohibited.
 The purchase of foreign currency denominated securities is prohibited.

3. Investment Pools/Mutual Funds:

The City shall conduct a thorough investigation of any pool or mutual fund prior to making an investment, and on a continual basis thereafter. The investment officer shall develop a questionnaire which will answer the following general questions:
 A description of eligible investment securities, and a written statement of investment policy and objectives.
358
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11  A description of interest calculations and how it is distributed, and how gains and losses are treated.
 A description of how the securities are safeguarded (including the settlement processes), and how often the securities are priced and the program audited.  A description of who may invest in the program, how often, what size deposit and withdrawal are allowed.
 A schedule for receiving statements and portfolio listings.  Are reserves, retained earnings, etc. utilized by the pool/fund?  A fee schedule, and when and how is it assessed.
 Is the pool/fund eligible for bond proceeds and/or will it accept such proceeds?

4. Collateralization: Acceptable collateral shall be as follows:

Certificates of Deposit (CDs). The City shall require any commercial bank or savings and loan association to deposit eligible securities with an agency of a depository approved by the State Banking Department to secure any uninsured portion of a Non-Negotiable Certificate of Deposit. The value of eligible securities as defined pursuant to California Government Code, Section 53651, pledged against a Certificate of Deposit shall be equal to 150% of the face value of the CD if the securities are classified as mortgages and 110% of the face value of the CD for all other classes of security.

Collateralization of Bank Deposits. This is the process by which a bank or financial institution pledges securities, or other deposits for the purpose of securing repayment of deposited funds. The City shall require any bank or financial institution to comply with the collateralization criteria defined in California Government Code, Section 53651.

Repurchase Agreements. The City requires that Repurchase Agreements be collateralized only by securities authorized in accordance with California Government Code:
 The securities which collateralize the repurchase agreement shall be priced at Market Value, including any Accrued Interest plus a margin. The Market Value of the securities that underlie a repurchase agreement shall be valued at 102% or greater of the funds borrowed against those securities.
 Financial institutions shall mark the value of the collateral to market at least monthly and increase or decrease the collateral to satisfy the ratio requirement described above.
 The City shall receive monthly statements of collateral.

F. INVESTMENT PARAMETERS

1. Mitigating Credit Risk in the Portfolio: Credit risk is the risk that a security or a portfolio will lose some or all its value due to a real or perceived change in the ability of the issuer to repay its debt. The City will mitigate credit risk by adopting the following strategies:
 The diversification requirements included in the “Suitable and Authorized Investments” section of this policy are designed to mitigate credit risk in the portfolio. 359
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12  No more than 5% of the total portfolio may be deposited with or invested in securities issued by any single issuer unless otherwise specified in this policy.  The City may elect to sell a security prior to its maturity and record a capital gain or loss in order to manage the quality, liquidity or yield of the portfolio in response to market conditions or City’s risk preferences.
 If the credit ratings of any security owned by the City are downgraded to a level below the quality required by this investment policy, making the security ineligible for additional purchases, the following steps will be taken:
 If a security is downgraded, the investment officer will use discretion in determining whether to sell or hold the security based on its current maturity, the economic outlook for the issuer, and other relevant factors. If employing an investment manager, any actions taken related to the downgrade by the investment manager will be communicated to the investment officer in a timely manner.  If a decision is made to retain a downgraded security in the portfolio, its presence in the portfolio will be monitored and reported monthly to the City Council.

2. Mitigating Market Risk in the Portfolio: Market risk is the risk that the portfolio value will fluctuate due to changes in the general level of interest rates. The City recognizes that, over time, longer-term portfolios have the potential to achieve higher returns. Likewise, longer-term portfolios have higher volatility of return. The City will mitigate market risk by providing adequate liquidity for short-term cash needs, and by making longer-term investments only with funds that are not needed for current cash flow purposes.

The City further recognizes that certain types of securities, including variable rate securities, securities with principal paydowns prior to maturity, and securities with embedded options, will affect the market risk profile of the portfolio differently in different interest rate environments. The City, therefore, adopts the following strategies to control and mitigate its exposure to market risk:
 The City will maintain a minimum of six months of budgeted operating expenditures in short term investments to provide sufficient liquidity for expected disbursements.  The maximum stated final maturity of individual securities in the portfolio will be five (5) years as measured from the date of trade settlement, except as otherwise stated in this policy.
 The duration of the portfolio will generally be approximately equal to the duration (typically, plus or minus 20%) of a Market Benchmark, an index selected by the City based on the City’s investment objectives, constraints and risk tolerances.

3. Maximum Maturities: To the extent possible, the City shall attempt to match its investments with anticipated cash flow requirements. The City will not directly invest in securities maturing more than five years from the date of purchase trade settlement or in accordance with state and local statutes and ordinances, unless the City Council has by resolution granted authority to make such an investment either specifically or as part of an investment program approved by the City Council no less than three months prior to the 360
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13 investment. The City investment officer shall adopt weighted average maturity limitations, consistent with the investment objectives.

Because of inherent difficulties in accurately forecasting cash flow requirements, a portion of the portfolio should be continuously invested in readily available funds such as LGIPs, money market funds, or overnight repurchase agreements to ensure that appropriate liquidity is maintained to meet ongoing obligations.

G. INVESTMENT STRATEGIES:

The investment program shall seek to augment returns consistent with the intent of this policy, identified risk limitations and prudent investment principles. These objectives will be achieved by use of the following strategies:

The source of and purpose for surplus funds determines the goal to be accomplished by the strategy. Bond proceeds, for example, typically have three purposes: reserve funds, project funds, and debt service funds. The goal and corresponding investment strategy is different for each, as follows:
 Reserve Funds. The goal is to have these funds available in case of default while minimizing negative arbitrage. The strategy is to call for competitive bids for long-term investment agreements with a call provision for default or redemption from AAA-rated limitations.
 Project Funds. The goal is to maintain purchasing power. The strategy, assuming a normal yield curve, is to match investment agreement maturities with construction draw schedules. Funds needed within 12 months are currently placed in an AAA-rated mutual fund of U.S. Treasury Securities.
 Debt Service Funds. The goal is to maintain liquidity. Generally, funds are placed in a money market mutual fund related investment category.

Surplus funds in the City pool come from a mixed bag of services for a wide variety of purposes. This blend of funds leads to the general investment goal of earning an appropriate yield consistent with the City’s high standards for safety and liquidity.

H. INVESTMENT PERFORMANCE
The investment portfolio shall be designed to attain a market-average rate of return throughout budgetary and economic cycles, taking into account the City’s risk constraints, the cash flow characteristics of the portfolio, and state and local laws, ordinances or resolutions that restrict investments.

The investment officer shall monitor and evaluate the portfolio’s performance relative to the chosen market benchmark(s), which will be included in the investment officer’s quarterly report. The investment officer shall select an appropriate, readily available index to use as a market benchmark.

I. REPORTING

1. Methods: The investment officer shall prepare an investment report at least quarterly, including a management summary that provides an analysis of the status of the current 361
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14 investment portfolio and the individual transactions executed over the last quarter. This report shall include the type of investment, issuer, date of maturity, and par and dollar amount invested on all securities, investments and moneys held by the City. The report shall also include a current market value as of the date of the report. It shall state compliance of the portfolio to the statement of investment policy or manner in which the portfolio id not in compliance. Finally, the report shall include a statement denoting the ability of the local agency to meet its pool’s expenditure requirements for the next six months or provide an explanation as to why sufficient money shall, or may, not be available. Once a year, the statement of investment policy shall be included in the report.

2. Performance Standards: The investment portfolio will be managed in accordance with the parameters specified within this policy. The portfolio should obtain a market average rate of return during a market/economic environment of stable interest rates. A series of appropriate benchmarks shall be established against which portfolio performance shall be compared on a regular basis.

3. Marking to Market: The market value of the portfolio shall be calculated at least monthly and a statement of the market value of the portfolio shall be issued at least monthly. This will ensure that review of the investment portfolio, in terms of value and price volatility, has been performed consistent with the GFOA Recommended Practice on “Mark-to-Market Practices for State and Local Government Investment Portfolios and Investment Pools.” In defining market value, considerations should be given to the GASB Statement 31 pronouncement.

4. Annual Reports: The investment policy shall be reviewed at least annually within 120 days of the end of the fiscal year to ensure its consistency with the overall objectives of preservation of principal, liquidity and return, and its relevance to current law and financial and economic trends. A comprehensive annual report shall be presented in conjunction with the investment policy review. This report shall include comparisons of City’s return to the City’s benchmark return, shall suggest policies and improvements that might enhance the investment program, and shall include an investment plan for the coming year.

5. Annual Audit: Management shall establish an annual process of independent review by the external auditor to assure compliance with internal controls. Such audit will include tests deemed appropriate by the auditor.

J. PORTFOLIO AND POLICY CONSIDERATIONS

1. Portfolio Review: The investment officer shall periodically, but no less than quarterly, review the portfolio to identify investments that do not comply with this investment policy and establish protocols for reporting major and critical incidences of noncompliance to the City Council.

2. Policy Amendments: This policy shall be reviewed on an annual basis within 120 days of the end of the fiscal year to ensure its consistency with the overall objectives of preservation of principal, liquidity and return, and its relevance to current law and financial and economic trends. Any recommended modifications or changes shall be presented by the investment officer to the City Council for their consideration and adoption.

K. GLOSSARY OF TERMS
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15 Agencies: Shorthand market terminology for any obligation issued by a government-sponsored entity (GSE), or a federally related institution. Most obligations of GSEs are not guaranteed by the full faith and credit of the US government. Examples are:

FFCB: The Federal Farm Credit Bank System provides credit and liquidity in the agricultural industry. FFCB issues discount notes and bonds.

FHLB: The Federal Home Loan Bank provides credit and liquidity in the housing market.

FHLB issues discount notes and bonds.

FHLMC: Like FHLB, the Federal Home Loan Mortgage Corporation provides credit and liquidity in the housing market. FHLMC, also called “FreddieMac” issues discount notes, bonds and mortgage pass-through securities.

FNMA: Like FHLB and FreddieMac, the Federal National Mortgage Association was established to provide credit and liquidity in the housing market. FNMA, also known as “FannieMae,” issues discount notes, bonds and mortgage pass-through securities.

GNMA: The Government National Mortgage Association, known as “GinnieMae,” issues mortgage pass-through securities, which are guaranteed by the full faith and credit of the US Government.

PEFCO: The Private Export Funding Corporation assists exporters. Obligations of PEFCO are not guaranteed by the full faith and credit of the US government.

TVA: The Tennessee Valley Authority provides flood control and power and promotes development in portions of the Tennessee, Ohio, and Mississippi River valleys. TVA currently issues discount notes and bonds.

Asset Backed Securities: Securities supported by pools of installment loans or leases or by pools of revolving lines of credit.

Average Life: In mortgage-related investments, including CMOs, the average time to expected receipt of principal payments, weighted by the amount of principal expected.

Banker’s Acceptance: A money market instrument created to facilitate international trade transactions. It is highly liquid and safe because the risk of the trade transaction is transferred to the bank which “accepts” the obligation to pay the investor.

Benchmark: A comparison security or portfolio. A performance benchmark is a partial market index, which reflects the mix of securities allowed under a specific investment policy.

Broker: A broker brings buyers and sellers together for a transaction for which the broker receives a commission. A broker does not sell securities from his own position.

Callable: A callable security gives the issuer the option to call it from the investor prior to its maturity. The main cause of a call is a decline in interest rates. If interest rates decline, the issuer will likely call its current securities and reissue them at a lower rate of interest.

Certificate of Deposit (CD): A time deposit with a specific maturity evidenced by a certificate.

Certificate of Deposit Account Registry SYSTEM (CDARS): A private placement service that allows local agencies to purchase more than $250,000 in CDs from a single financial institution (must be a participating institution of CDARS) while still maintaining FDIC insurance coverage.

CDARS is currently the only entity providing this service. CDARS facilitates the trading of deposits 363
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16 between the California institution and other participating institutions in amounts that are less than $250,000 each, so that FDIC coverage is maintained.

Collateral: Securities or cash pledged by a borrower to secure repayment of a loan or repurchase agreement. Also, securities pledged by a financial institution to secure deposits of public monies.

Collateralized Bank Deposit: A bank deposit that is collateralized at least 100% (principal plus interest to maturity). The deposit is collateralized using assets set aside by the issuer such as Treasury securities or other qualified collateral to secure the deposit in excess of the limit covered by the Federal Deposit Insurance Corporation.

Collateralized Mortgage Obligations (CMO): Classes of bonds that redistribute the cash flows of mortgage securities (and whole loans) to create securities that have different levels of prepayment risk, as compared to the underlying mortgage securities.

Collateralized Time Deposit: Time deposits that are collateralized at least 100% (principal plus interest to maturity). These instruments are collateralized using assets set aside by the issuer such as Treasury securities or other qualified collateral to secure the deposit in excess of the limit covered by the Federal Deposit Insurance Corporation.

Commercial Paper: The short-term unsecured debt of corporations.

Coupon: The rate of return at which interest is paid on a bond.

Credit Risk: The risk that principal and/or interest on an investment will not be paid in a timely manner due to changes in the condition of the issuer.

Dealer: A dealer acts as a principal in security transactions, selling securities from and buying securities for his own position.

Debenture: A bond secured only by the general credit of the issuer.

Delivery vs. Payment (DVP): A securities industry procedure whereby payment for a security must be made at the time the security is delivered to the purchaser’s agent.

Derivative: Any security that has principal and/or interest payments which are subject to uncertainty (but not for reasons of default or credit risk) as to timing and/or amount, or any security which represents a component of another security which has been separated from other components (“Stripped” coupons and principal). A derivative is also defined as a financial instrument the value of which is totally or partially derived from the value of another instrument, interest rate, or index.

Discount: The difference between the par value of a bond and the cost of the bond, when the cost is below par. Some short-term securities, such as T-bills and banker’s acceptances, are known as discount securities. They sell at a discount from par and return the par value to the investor at maturity without additional interest. Other securities, which have fixed coupons, trade at a discount when the coupon rate is lower than the current market rate for securities of that maturity and/or quality.

Diversification: Dividing investment funds among a variety of investments to avoid excessive exposure to any one source of risk.

Duration: The weighted average time to maturity of a bond where the weights are the present values of the future cash flows. Duration measures the price sensitivity of a security to changes interest rates.

Federal Deposit Insurance Corporation (FDIC): The Federal Deposit Insurance Corporation (FDIC) is an independent federal agency insuring deposits in U.S. banks and thrifts in the event 364
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17 of bank failures. The FDIC was created in 1933 to maintain public confidence and encourage stability in the financial system through the promotion of sound banking practices.

Federally Insured Time Deposit: A time deposit is an interest-bearing bank deposit account that has a specified date of maturity, such as a certificate of deposit (CD). These deposits are limited to funds insured in accordance with FDIC insurance deposit limits.

Leverage: Borrowing funds in order to invest in securities that have the potential to pay earnings at a rate higher than the cost of borrowing.

Liquidity: The speed and ease with which an asset can be converted to cash.

Local Agency Investment Fund (LAIF): A voluntary investment fund open to government entities and certain non-profit organizations in California that is managed by the State Treasurer’s Office.

Local Government Investment Pool: Investment pools that range from the State Treasurer’s Office Local Agency Investment Fund (LAIF) to county pools, to Joint Powers Authorities (JPAs).

These funds are not subject to the same SEC rules applicable to money market mutual funds.

Make Whole Call: A type of call provision on a bond that allows the issuer to pay off the remaining debt early. Unlike a call option, with a make whole call provision, the issuer makes a lump sum payment that equals the net present value (NPV) of future coupon payments that will not be paid because of the call. With this type of call, an investor is compensated, or "made whole." Margin: The difference between the market value of a security and the loan a broker makes using that security as collateral.

Market Risk: The risk that the value of securities will fluctuate with changes in overall market conditions or interest rates.

Market Value: The price at which a security can be traded.

Maturity: The final date upon which the principal of a security becomes due and payable.

Medium Term Notes: Unsecured, investment-grade senior debt securities of major corporations which are sold in relatively small amounts on either a continuous or an intermittent basis. MTNs are highly flexible debt instruments that can be structured to respond to market opportunities or to investor preferences.

Modified Duration: The percent change in price for a 100-basis point change in yields. Modified duration is the best single measure of a portfolio’s or security’s exposure to market risk.

Money Market: The market in which short-term debt instruments (T-bills, discount notes, commercial paper, and banker’s acceptances) are issued and traded.

Money Market Mutual Fund: A mutual fund that invests exclusively in short-term securities.

Examples of investments in money market funds are certificates of deposit and U.S. Treasury securities. Money market funds attempt to keep their net asset values at $1 per share.

Mortgage Pass-Through Securities: A securitized participation in the interest and principal cash flows from a specified pool of mortgages. Principal and interest payments made on the mortgages are passed through to the holder of the security.

Municipal Securities: Securities issued by state and local agencies to finance capital and operating expenses.

Mutual Fund: An entity which pools the funds of investors and invests those funds in a set of securities which is specifically defined in the fund’s prospectus. Mutual funds can be invested in various types of domestic and/or international stocks, bonds, and money market instruments, as set forth in the individual fund’s prospectus. For most large, institutional investors, the costs 365
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18 associated with investing in mutual funds are higher than the investor can obtain through an individually managed portfolio.

Nationally Recognized Statistical Rating Organization (NRSRO): A credit rating agency that the Securities and Exchange Commission in the United States uses for regulatory purposes. Credit rating agencies provide assessments of an investment's risk. The issuers of investments, especially debt securities, pay credit rating agencies to provide them with ratings. The three most prominent NRSROs are Fitch, S&P, and Moody's.

Negotiable Certificate of Deposit (CD): A short-term debt instrument that pays interest and is issued by a bank, savings or federal association, state or federal credit union, or state-licensed branch of a foreign bank. Negotiable CDs are traded in a secondary market and are payable upon order to the bearer or initial depositor (investor).

Primary Dealer: A financial institution (1) that is a trading counterparty with the Federal Reserve in its execution of market operations to carry out U.S. monetary policy, and (2) that participates for statistical reporting purposes in compiling data on activity in the U.S. Government securities market.

Prudent Person (Prudent Investor) Rule: A standard of responsibility which applies to fiduciaries.

In California, the rule is stated as “Investments shall be managed with the care, skill, prudence and diligence, under the circumstances then prevailing, that a prudent person, acting in a like capacity and familiar with such matters, would use in the conduct of an enterprise of like character and with like aims to accomplish similar purposes.”
Repurchase Agreement: Short-term purchases of securities with a simultaneous agreement to sell the securities back at a higher price. From the seller’s point of view, the same transaction is a reverse repurchase agreement.

Safekeeping: A service to bank customers whereby securities are held by the bank in the customer’s name.

Securities and Exchange Commission (SEC): The U.S. Securities and Exchange Commission (SEC) is an independent federal government agency responsible for protecting investors, maintaining fair and orderly functioning of securities markets and facilitating capital formation. It was created by Congress in 1934 as the first federal regulator of securities markets. The SEC promotes full public disclosure, protects investors against fraudulent and manipulative practices in the market, and monitors corporate takeover actions in the United States.

Securities and Exchange Commission (SEC) Rule 15c3-1: An SEC rule setting capital requirements for brokers and dealers. Under Rule 15c3-1, a broker or dealer must have sufficient liquidity in order to cover the most pressing obligations. This is defined as having a certain amount of liquidity as a percentage of the broker/dealer's total obligations. If the percentage falls below a certain point, the broker or dealer may not be allowed to take on new clients and may have restrictions placed on dealings with current client.

Structured Note: A complex, fixed income instrument, which pays interest, based on a formula tied to other interest rates, commodities or indices. Examples include inverse floating rate notes which have coupons that increase when other interest rates are falling, and which fall when other interest rates are rising, and "dual index floaters," which pay interest based on the relationship between two other interest rates - for example, the yield on the ten-year Treasury note minus the Libor rate. Issuers of such notes lock in a reduced cost of borrowing by purchasing interest rate swap agreements.
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19 Supranational: A Supranational is a multi-national organization whereby member states transcend national boundaries or interests to share in the decision making to promote economic development in the member countries.

Total Rate of Return: A measure of a portfolio’s performance over time. It is the internal rate of return, which equates the beginning value of the portfolio with the ending value; it includes interest earnings, realized and unrealized gains, and losses in the portfolio.

Treasury Bills: All securities issued with initial maturities of one year or less are issued as discounted instruments and are called Treasury bills. The Treasury currently issues three- and six-month T-bills at regular weekly auctions. It also issues “cash management” bills as needed to smooth out cash flows.

Treasury Bonds: All securities issued with initial maturities greater than ten years are called Treasury bonds. Like Treasury notes, they pay interest semi-annually.

Treasury Notes: All securities issued with initial maturities of two to ten years are called Treasury notes and pay interest semi-annually.

U.S. Treasury Obligations: Securities issued by the U.S. Treasury and backed by the full faith and credit of the United States. Treasuries are considered to have no credit risk and are the benchmark for interest rates on all other securities in the US and overseas. The Treasury issues both discounted securities and fixed coupon notes and bonds.

Yield to Maturity: The annualized internal rate of return on an investment which equates the expected cash flows from the investment to its cost.
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Attachment 3
1 CITY OF WEST SACRAMENTO
ADMINISTRATIVE POLICY NUMBER: IV-C-2
DATE: September 8, 1992
Revised: February 1, 1999
Revised: October 15, 2014
Revised: November 1, 2017
Revised: August 21, 2019
Revised: June 16, 2021
Revised: June 7, 2023
SUBJECT: INVESTMENT POLICY AUTHORITY: City Council

PURPOSE
This policy sets forth the procedural regulations for investing surplus funds. The intent of the Investment Policy of the City of West Sacramento is to define the parameters within which funds are to be managed.

POLICY
In methods, procedures, and practices, the policy formalizes the framework for the City’s investment activities that must be exercised to ensure effective and judicious fiscal and investment management of the City’s funds. The guidelines are intended to be broad enough to allow the investment officer to function properly within the parameters of responsibility and authority, yet specific enough to safeguard the investment assets.

PROCEDURE
A. SCOPE
This policy applies to the investment of surplus operating and capital funds and proceeds from certain bond issues. It conforms to best practices as outlined by Government Finance Officers Association, Association of Public Treasurers of the United States and Canada, and California Municipal Treasurers’ Association.

1. Pooling of Funds: Except for cash in certain restricted and special funds, the City will consolidate cash balances from all funds to maximize investment earnings. Investment income will be allocated to the various funds based on their respective participation and in accordance with generally accepted accounting principles.

B. GENERAL OBJECTIVES
The primary objectives, in priority order, of investment activities shall be safety, liquidity, and return.

1. Safety: Safety of principal is the foremost objective of the investment program.

Investments shall be undertaken in a manner that seeks to ensure the preservation of capital in the overall portfolio. To attain this objective, the City will diversify its investments by investing funds among a variety of securities with independent returns. The objective will be to mitigate credit risk and market risk, further explained below. 368
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2 2. Liquidity: The investment portfolio shall remain sufficiently liquid to meet all operating requirements that may be reasonably anticipated. This is accomplished by structuring the portfolio so that securities mature concurrent with cash needs to meet anticipated demands (static liquidity). Furthermore, since all possible cash demands cannot be anticipated, the portfolio should consist largely of securities with active secondary or resale markets (dynamic liquidity). A portion of the portfolio also may be placed in money market mutual funds or local government investment pools which offer same-day liquidity for short-term funds.

3. Return: The investment portfolio shall be designed with the objective of attaining a market rate of return throughout budgetary and economic cycles, taking into account the investment risk constraints and liquidity needs. Return on investment is of secondary importance compared to the safety and liquidity objectives described above. The core of investments are limited to relatively low risk securities in anticipation of earning a fair return relative to the risk being assumed.

C. STANDARDS OF CARE

1. Prudence: The standard of prudence to be used by investment officials shall be the “prudent investor” standard (California Government Code section 53600.3) and shall be applied in the context of managing an overall portfolio. Pursuant to this section of Code, all persons authorized to make investment decisions on behalf of the City are trustees and therefore fiduciaries subject to the Prudent Investor Standard:
“…all governing bodies of local agencies or persons authorized to make investment decisions on behalf of those local agencies investing public funds pursuant to this chapter are trustees and therefore fiduciaries subject to the prudent investor standard. When investing, reinvesting, purchasing, acquiring, exchanging, selling, or managing public funds, a trustee shall act with care, skill, prudence, and diligence under the circumstances then prevailing, including, but not limited to, the general economic conditions and the anticipated needs of the Agency, that a prudent person acting in a like capacity and familiarity with those matters would use in the conduct of funds of a like character and with like aims, to safeguard the principal and maintain the liquidity needs of the Agency. Within the limitations of this section and considering individual investments as part of an overall strategy, investments may be acquired as authorized by law.” Investment officers acting in accordance with written procedures and this investment policy and exercising due diligence shall be relieved of personal responsibility for an individual security’s credit risk or market price changes, provided deviations from expectations are reported in a timely fashion and the liquidity and the sale of securities are carried out in accordance with the terms of this policy.

2. Ethics and Conflicts of Interest: Officers and employees involved in the investment process shall refrain from personal business activity that could conflict with the proper execution and management of the investment program, or that could impair their ability to make impartial decisions. Employees and investment officials shall disclose any material interests in financial institutions with which they conduct business. They shall further disclose any personal financial/ investment positions that could be related to the performance of the investment portfolio. Employees and officers shall refrain from undertaking personal investment transactions with the same individual with whom business is conducted on behalf of the City.

3. Delegation of Authority: Authority to manage the investment program is granted to the Director of Finance/City Treasurer, hereinafter referred to as investment officer, and derived from California Government Code, Sections 41006 and 53600 et seq as well as Ordinance 87-12. Responsibility for the operation of the investment program is hereby 369
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3 delegated to the investment officer, who shall act in accordance with established written procedures and internal controls for the operation of the investment program consistent with this investment policy. Procedures should include references to: safekeeping, delivery vs. payment, investment accounting, repurchase agreements, wire transfer agreements, and collateral/depository agreements. No person may engage in an investment transaction except as provided under the terms of this policy and the procedures established by the investment officer. The investment officer shall be responsible for all transactions undertaken and shall establish a system of controls to regulate the activities of subordinate officials. The City may engage the services of one or more external investment advisers, who are registered under the Investment Advisers Act of 1940, to assist in the management of the City’s investment portfolio in a manner consistent with the City’s objectives. External investment advisers may be granted discretion to purchase and sell investment securities in accordance with this investment policy.

The City’s overall investment program shall be designed and managed with a degree of professionalism that is worthy of the public trust. The City recognizes that in a diversified portfolio, occasional measured losses may be inevitable and must be considered within the context of the overall portfolio’s return and the cash flow requirements of the City.

D. SAFEKEEPING AND CUSTODY

1. Authorized Financial Dealers and Institutions: To the extent practicable, the investment officer shall endeavor to complete investment transactions using a competitive bid process whenever possible. The investment officer will determine which financial institutions are authorized to provide investment services to the City. It shall be the City’s policy to purchase securities only from authorized institutions and firms. A list will be maintained of financial institutions authorized to provide investment services. In addition, a list also will be maintained of approved security broker/dealers selected by creditworthiness (e.g., a minimum capital requirement of $10,000,000 and at least five years of operation). These may include “primary” dealers or regional dealers that qualify under Securities and Exchange Commission (SEC) Rule 15C3-1 (uniform net capital rule).

In accordance with Section 53601.5, institutions eligible to transact investment business with the City include:
 Primary government dealers as designated by the Federal Reserve Bank and nonprimary government dealers.  Nationally or state-chartered banks.
 The Federal Reserve Bank.
 Direct issuers of securities eligible for purchase.

Selection of financial institutions and broker/dealers authorized to engage in transactions will be at the sole discretion of the City, except where the City utilizes an external investment adviser in which case the City may rely on the adviser for selection.

All financial institutions and broker/dealers who desire to become qualified for investment transactions must supply the following as appropriate:
 Audited financial statements.
 Proof of National Association of Securities Dealers (NASD) certification.  Proof of state registration.
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4  Completed broker/dealer questionnaire.
 Certification of having read and understood and agreeing to comply with the City’s investment policy.
 Evidence of adequate insurance coverage.

An annual review of the financial condition and registration of qualified financial institutions and broker/dealers will be conducted by the investment officer.

From time to time, the investment officer may choose to invest in instruments offered by minority and community financial institutions. In such instances, a waiver to the criteria under Paragraph 1 may be granted. All terms and relationships will be fully disclosed prior to purchase and will be reported to the appropriate entity on a consistent basis and should be consistent with state or local law. These types of investment purchases should be approved by the appropriate legislative or governing body in advance.

Public deposits will be made only in qualified public depositories as established by State law. Deposits will be insured by the Federal Deposit Insurance Corporation, or, to the extent the amount exceeds the insured maximum, will be collateralized in accordance with State law.

Selection of broker/dealers used by an external investment adviser retained by the City will be at the sole discretion of the adviser. Where possible, transactions with broker/dealers shall be selected on a competitive basis and their bid or offering prices shall be recorded. If there is no other readily available competitive offering, best efforts will be made to document quotations for comparable or alternative securities. When purchasing original issue instrumentality securities, no competitive offerings will be required as all dealers in the selling group offer those securities at the same original issue price.

2. Internal Controls: The investment officer is responsible for establishing and maintaining an internal control structure designed to ensure that the assets of the City are protected from loss, theft or misuse. Specifics for the internal controls shall be documented in an investment procedures manual that shall be reviewed and updated periodically by the Investment Officer. An example of such a procedure would include the requirement that the Director of Finance approve trades transacted by other authorized personnel. The internal control structure shall be designed to provide reasonable assurance that these objectives are met. The concept of reasonable assurance recognizes that (1) the cost of a control should not exceed the benefits likely to be derived and (2) the valuation of costs and benefits requires estimates and judgments by management.

Accordingly, the investment officer shall establish a process for an annual independent review by an external auditor to assure compliance with policies and procedures. The internal controls shall address the following points:
 Control of collusion.
 Separation of transaction authority from accounting and recordkeeping.  Custodial safekeeping.
 Avoidance of physical delivery securities.
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5  Clear designation of authority to subordinate staff members.  Written confirmation of transactions for investments and wire transfers.  Dual authorizations of wire transfers.
 Staff training.
 Development of a wire transfer agreement with the lead bank and third-party custodian.

3. Delivery vs. Payment: All trades where applicable will be executed by delivery vs. payment (DVP) to ensure that securities are deposited in an eligible financial institution prior to the release of funds. Securities will be held by a third-party custodian as evidenced by safekeeping receipts. The only exception to the foregoing shall be depository accounts and securities purchase made with: Local Agency Investment Fund (LAIF), California Asset Management Program, time certificates of deposit and money market mutual funds, since the purchased securities are not deliverable.

4. Third-Party Safekeeping: Securities will be held by an independent third-party safekeeping institution selected by the City. All securities will be evidenced by safekeeping receipts in the City’s name. The safekeeping institution shall annually provide a copy of its most recent report on internal controls – Service Organization Control Reports (formerly 70, or SAS 70) prepared in accordance with the Statements of Standards for Attestation Engagements (SSAE) No. 16 (effective June 15, 2011).

E. SUITABLE AND AUTHORIZED INVESTMENTS

1. Investment Types: Investments shall be placed to conform to those allowable under the State of California Government Code section 53600 et seq. Within the investments permitted by the Code, the City seeks to further restrict eligible investments to the guidelines listed below. Consistent with the GFOA Policy Statement and Local Laws Concerning Investment Practices, the following investments will be permitted by this policy and are those defined by state and local law where applicable. If additional types of securities are approved for investment by public funds by state statute, they will not be eligible for investment by the City until this Policy has been amended and the amended version adopted by the City Council. In the event a discrepancy is found between this policy and the Code, the more restrictive parameters will take precedence. Percentage holding limits and minimum credit quality requirements listed in this section apply at the time the security is purchased.

Any investment currently held at the time the policy is adopted which does not meet the new policy guidelines can be held until maturity and shall be exempt from the current policy. At the time of the investment’s maturity or liquidation, such funds shall be reinvested only as provided in the current policy.

An appropriate risk level shall be maintained by primarily purchasing securities that are of high quality, liquid, and marketable. The portfolio shall be diversified by security type and institution to avoid incurring unreasonable and avoidable risks regarding specific security types or individual issuers.

Authorized securities include:
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6 A. Municipal Securities include obligations of the City, the State of California and any local agency within the State of California, provided that:
 The securities are rated in a rating category of “A” or its equivalent or better by at least one nationally recognized statistical rating organization (“NRSRO”).  No more than 5% of the portfolio may be invested in any single issuer.  No more than 30% of the portfolio may be in Municipal Securities.  The maximum maturity does not exceed five (5) years.

B. Municipal Securities (Registered Treasury Notes or Bonds) of any of the other 49 states in addition to California, including bonds payable solely out of the revenues from a revenue-producing property owned, controlled, or operated by a state or by a department, board, agency, or authority of any of the other 49 states, in addition to California.
 The securities are rated in a rating category of “A” or its equivalent or better by at least one nationally recognized statistical rating organization (“NRSRO”).  No more than 5% of the portfolio may be invested in any single issuer.  No more than 30% of the portfolio may be in Municipal Securities.  The maximum maturity does not exceed five (5) years.

C. U.S. Treasuries and other government obligations for which the full faith and credit of the United States are pledged for the payment of principal and interest. There are no limits on the dollar amount or percentage that the City may invest in U.S. Treasuries, provided that:
 The maximum maturity is five (5) years.

D. Federal Agencies or United States Government-Sponsored Enterprise obligations, participations, or other instruments, including those issued by or fully guaranteed as to principal and interest by federal agencies or United States government-sponsored enterprises. There are no limits on the dollar amount or percentage that the City may invest in Federal Agency or Government-Sponsored Enterprises (GSEs), provided that:
 No more than 30% of the portfolio may be invested in any single Agency/GSE issuer.
 The maximum maturity does not exceed five (5) years.
 The maximum percent of agency callable securities in the portfolio will be 20%.

E. Banker’s Acceptances, provided that:
 They are issued by institutions which have short-term debt obligations rated “A-1” or its equivalent or better by at least one NRSRO; or long-term debt obligations which are rated in a rating category of “A” or its equivalent or better by at least one NRSRO.
 No more than 40% of the portfolio may be invested in Banker’s Acceptances.  No more than 5% of the portfolio may be invested in any single issuer.  The maximum maturity does not exceed 180 days.
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7 F. Commercial Paper, provided that the securities are issued by an entity that meets all of the following conditions in either paragraph (a) or (b) and other requirements specified below:
i. SECURITIES issued by corporations:

1. A corporation organized and operating in the United States with assets more than $500 million.

2. The securities are rated “A-1” or its equivalent or better by at least one NRSRO.

3. If the issuer has other debt obligations, they must be rated in a rating category of “A” or its equivalent or better by at least one NRSRO. ii. SECURITIES issued by other entities:

1. The issuer is organized within the United States as a special purpose corporation, trust, or limited liability company.

2. The securities must have program-wide credit enhancements including, but not limited to, overcollateralization, letters of credit, or a surety bond.

3. The securities are rated “A-1” or its equivalent or better by at least one NRSRO.  City may purchase no more than 10% of the outstanding commercial paper of any single issuer.
 No more than 25% of the portfolio may be invested in Commercial Paper. Under a provision sunsetting on January 1, 2026, no more than 40% of the portfolio may be invested in Commercial Paper if the Agency’s investment assets under management are greater than $100,000,000.
 No more than 5% of the portfolio may be invested in any single issuer.  The maximum maturity does not exceed 270 days.

G. Negotiable Certificates of Deposit (NCDs), issued by a nationally or state-chartered bank, a savings association or a federal association, a state or federal credit union, or by a federally licensed or state-licensed branch of a foreign bank, provided that:
 The amount of the NCD insured up to the FDIC limit does not require any credit ratings.
 Any amount above the FDIC insured limit must be issued by institutions which have short-term debt obligations rated “A-1” or its equivalent or better by at least one NRSRO; or long-term obligations rated in a rating category of “A” or its equivalent or better by at least one NRSRO.
 No more than 30% of the total portfolio may be invested in NCDs (combined with CDARS).
 No more than 5% of the portfolio may be invested in any single issuer.  The maximum maturity does not exceed five (5) years.

H. Federally Insured Time Deposits (Non-Negotiable Certificates of Deposit) in state or federally chartered banks, savings and loans, or credit unions, provided that:
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8  The amount per institution is limited to the maximum covered under federal insurance.
 No more than 20% of the portfolio will be invested in a combination of federally insured and collateralized time deposits.
 The maximum maturity does not exceed five (5) years.

I. Collateralized Time Deposits (Non-Negotiable Certificates of Deposit) in state or federally chartered banks, savings and loans, or credit unions in excess of insured amounts which are fully collateralized with securities in accordance with California law, provided that:
 No more than 20% of the portfolio will be invested in a combination of federally insured and collateralized time deposits.
 The maximum maturity does not exceed five (5) years.

J. Certificate of Deposit Placement Service (CDARS), provided that:
 No more than 30% of the total portfolio may be invested in a combination of Certificates of Deposit, including CDARS.
 The maximum maturity does not exceed five (5) years.

K. Collateralized Bank Deposits. City’s deposits with financial institutions will be collateralized with pledged securities per California Government Code, Section 53651.

There are no limits on the dollar amount or percentage that the City may invest in collateralized bank deposits.

L. Repurchase Agreements collateralized with securities authorized under California Government Code, maintained at a level of at least 102% of the market value of the Repurchase Agreement. There are no limits on the dollar amount or percentage that the City may invest, provided that:
 Securities used as collateral for Repurchase Agreements will be delivered to an acceptable third-party custodian.
 Repurchase Agreements are subject to a Master Repurchase Agreement between the City and the provider of the repurchase agreement. The Master Repurchase Agreement will be substantially in the form developed by the Securities Industry and Financial Markets Association (SIFMA).
 The maximum maturity does not exceed one (1) year.

M. State of California Local Agency Investment Fund (LAIF), provided that:
 The City may invest up to the maximum amount permitted by LAIF.  LAIF’s investments in instruments prohibited by or not specified in the City’s policy do not exclude the investment in LAIF itself from the City’s list of allowable investments, provided LAIF’s reports allow the investment officer to adequately judge the risk inherent in LAIF’s portfolio.

N. Local Government Investment Pools
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9  Other LGIPs permitted by client.
 There is no issuer limitation for Local Government Investment Pools O. Corporate Medium-Term Notes (MTNs), provided that:
 The issuer is a corporation organized and operating within the United States or by depository institutions licensed by the United States or any state and operating within the United States.
 The securities are rated in a rating category of “A” or its equivalent or better by at least one NRSRO.
 No more than 30% of the total portfolio may be invested in MTNs.  No more than 5% of the portfolio may be invested in any single issuer.  The maximum maturity does not exceed five (5) years.

P. Asset-Backed, Mortgage-Backed, Mortgage Pass-Through Securities, and Collateralized Mortgage Obligations from issuers not defined in sections C and D of the Authorized Investments section of this policy, provided that:
 The securities are rated in a rating category of “AA” or its equivalent or better by a NRSRO.
 No more than 20% of the total portfolio may be invested in these securities.  No more than 5% of the portfolio may be invested in any single Asset-Backed or Commercial Mortgage security issuer.
 The maximum legal final maturity does not exceed five (5) years.

Q. Mutual Funds and Money Market Mutual Funds that are registered with the Securities and Exchange Commission under the Investment Company Act of 1940, provided that:
a. Mutual Funds that invest in the securities and obligations as authorized under California Government Code, Section 53601 (a) to (k) and (m) to (q) inclusive and that meet either of the following criteria:
(i) Attained the highest ranking or the highest letter and numerical rating provided by not less than two (2) NRSROs; or
(ii) Have retained an investment adviser registered or exempt from registration with the Securities and Exchange Commission with not less than five years’ experience investing in the securities and obligations authorized by California Government Code, Section 53601 and with assets under management in excess of $500 million.
 No more than 10% of the total portfolio may be invested in shares of any one mutual fund.
b. Money Market Mutual Funds registered with the Securities and Exchange Commission under the Investment Company Act of 1940 and issued by diversified management companies and meet either of the following criteria:
(i) Have attained the highest ranking or the highest letter and numerical rating provided by not less than two (2) NRSROs; or
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10 (ii) Have retained an investment adviser registered or exempt from registration with the Securities and Exchange Commission with not less than five years’ experience managing money market mutual funds with assets under management in excess of $500 million.
 No more than 20% of the total portfolio may be invested in the shares of any one Money Market Mutual Fund.
c. No more than 20% of the total portfolio may be invested in these securities.

R. Supranationals, provided that:
 Issues are US dollar denominated senior unsecured unsubordinated obligations issued or unconditionally guaranteed by the International Bank for Reconstruction and Development, International Finance Corporation, or Inter-American Development Bank.
 The securities are rated in a rating category of “AA” or its equivalent or better by a NRSRO.
 No more than 30% of the total portfolio may be invested in these securities.  No more than 10% of the portfolio may be invested in any single issuer.  The maximum maturity does not exceed five (5) years.

2. Prohibited Investment Vehicles and Practices:
 State law notwithstanding, any investments not specifically described herein are prohibited, including, but not limited to futures and options.  In accordance with Government Code, Section 53601.6, investment in inverse floaters, range notes, or mortgage derived interest-only strips is prohibited.  Investment in any security that could result in a zero-interest accrual if held to maturity is prohibited. Investment in any security that could result in a zero interest accrual if held to maturity is prohibited Under a provision sunsetting on January 1, 2026, securities backed by the U.S. Government that could result in a zero- or negativeinterest accrual if held to maturity are permitted.  Trading securities for the sole purpose of speculating on the future direction of interest rates is prohibited.
 Purchasing or selling securities on margin is prohibited.  The use of reverse repurchase agreements, securities lending or any other form of borrowing or leverage is prohibited.
 The purchase of foreign currency denominated securities is prohibited.

3. Investment Pools/Mutual Funds:

The City shall conduct a thorough investigation of any pool or mutual fund prior to making an investment, and on a continual basis thereafter. The investment officer shall develop a questionnaire which will answer the following general questions:
 A description of eligible investment securities, and a written statement of investment policy and objectives.
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11  A description of interest calculations and how it is distributed, and how gains and losses are treated.
 A description of how the securities are safeguarded (including the settlement processes), and how often the securities are priced and the program audited.  A description of who may invest in the program, how often, what size deposit and withdrawal are allowed.
 A schedule for receiving statements and portfolio listings.  Are reserves, retained earnings, etc. utilized by the pool/fund?  A fee schedule, and when and how is it assessed.
 Is the pool/fund eligible for bond proceeds and/or will it accept such proceeds?

4. Collateralization: Acceptable collateral shall be as follows:

Certificates of Deposit (CDs). The City shall require any commercial bank or savings and loan association to deposit eligible securities with an agency of a depository approved by the State Banking Department to secure any uninsured portion of a Non-Negotiable Certificate of Deposit. The value of eligible securities as defined pursuant to California Government Code, Section 53651, pledged against a Certificate of Deposit shall be equal to 150% of the face value of the CD if the securities are classified as mortgages and 110% of the face value of the CD for all other classes of security.

Collateralization of Bank Deposits. This is the process by which a bank or financial institution pledges securities, or other deposits for the purpose of securing repayment of deposited funds. The City shall require any bank or financial institution to comply with the collateralization criteria defined in California Government Code, Section 53651.

Repurchase Agreements. The City requires that Repurchase Agreements be collateralized only by securities authorized in accordance with California Government Code:
 The securities which collateralize the repurchase agreement shall be priced at Market Value, including any Accrued Interest plus a margin. The Market Value of the securities that underlie a repurchase agreement shall be valued at 102% or greater of the funds borrowed against those securities.
 Financial institutions shall mark the value of the collateral to market at least monthly and increase or decrease the collateral to satisfy the ratio requirement described above.
 The City shall receive monthly statements of collateral.

F. INVESTMENT PARAMETERS

1. Mitigating Credit Risk in the Portfolio: Credit risk is the risk that a security or a portfolio will lose some or all its value due to a real or perceived change in the ability of the issuer to repay its debt. The City will mitigate credit risk by adopting the following strategies:
 The diversification requirements included in the “Suitable and Authorized Investments” section of this policy are designed to mitigate credit risk in the portfolio. 378
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12  No more than 5% of the total portfolio may be deposited with or invested in securities issued by any single issuer unless otherwise specified in this policy.  The City may elect to sell a security prior to its maturity and record a capital gain or loss in order to manage the quality, liquidity or yield of the portfolio in response to market conditions or City’s risk preferences.
 If the credit ratings of any security owned by the City are downgraded to a level below the quality required by this investment policy, making the security ineligible for additional purchases, the following steps will be taken:
 If a security is downgraded, the investment officer will use discretion in determining whether to sell or hold the security based on its current maturity, the economic outlook for the issuer, and other relevant factors. If employing an investment manager, any actions taken related to the downgrade by the investment manager will be communicated to the investment officer in a timely manner.  If a decision is made to retain a downgraded security in the portfolio, its presence in the portfolio will be monitored and reported monthly to the City Council.

2. Mitigating Market Risk in the Portfolio: Market risk is the risk that the portfolio value will fluctuate due to changes in the general level of interest rates. The City recognizes that, over time, longer-term portfolios have the potential to achieve higher returns. Likewise, longer-term portfolios have higher volatility of return. The City will mitigate market risk by providing adequate liquidity for short-term cash needs, and by making longer-term investments only with funds that are not needed for current cash flow purposes.

The City further recognizes that certain types of securities, including variable rate securities, securities with principal paydowns prior to maturity, and securities with embedded options, will affect the market risk profile of the portfolio differently in different interest rate environments. The City, therefore, adopts the following strategies to control and mitigate its exposure to market risk:
 The City will maintain a minimum of six months of budgeted operating expenditures in short term investments to provide sufficient liquidity for expected disbursements.  The maximum stated final maturity of individual securities in the portfolio will be five (5) years as measured from the date of trade settlement, except as otherwise stated in this policy.
 The duration of the portfolio will generally be approximately equal to the duration (typically, plus or minus 20%) of a Market Benchmark, an index selected by the City based on the City’s investment objectives, constraints and risk tolerances.

3. Maximum Maturities: To the extent possible, the City shall attempt to match its investments with anticipated cash flow requirements. The City will not directly invest in securities maturing more than five years from the date of trade settlement or in accordance with state and local statutes and ordinances, unless the City Council has by resolution granted authority to make such an investment either specifically or as part of an investment program approved by the City Council no less than three months prior to the investment. 379
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13 The City investment officer shall adopt weighted average maturity limitations, consistent with the investment objectives.

Because of inherent difficulties in accurately forecasting cash flow requirements, a portion of the portfolio should be continuously invested in readily available funds such as LGIPs, money market funds, or overnight repurchase agreements to ensure that appropriate liquidity is maintained to meet ongoing obligations.

G. INVESTMENT STRATEGIES:

The investment program shall seek to augment returns consistent with the intent of this policy, identified risk limitations and prudent investment principles. These objectives will be achieved by use of the following strategies:

The source of and purpose for surplus funds determines the goal to be accomplished by the strategy. Bond proceeds, for example, typically have three purposes: reserve funds, project funds, and debt service funds. The goal and corresponding investment strategy is different for each, as follows:
 Reserve Funds. The goal is to have these funds available in case of default while minimizing negative arbitrage. The strategy is to call for competitive bids for long-term investment agreements with a call provision for default or redemption from AAA-rated limitations.
 Project Funds. The goal is to maintain purchasing power. The strategy, assuming a normal yield curve, is to match investment agreement maturities with construction draw schedules. Funds needed within 12 months are currently placed in an AAA-rated mutual fund of U.S. Treasury Securities.
 Debt Service Funds. The goal is to maintain liquidity. Generally, funds are placed in a money market mutual fund related investment category.

Surplus funds in the City pool come from a mixed bag of services for a wide variety of purposes. This blend of funds leads to the general investment goal of earning an appropriate yield consistent with the City’s high standards for safety and liquidity.

H. INVESTMENT PERFORMANCE
The investment portfolio shall be designed to attain a market-average rate of return throughout budgetary and economic cycles, taking into account the City’s risk constraints, the cash flow characteristics of the portfolio, and state and local laws, ordinances or resolutions that restrict investments.

The investment officer shall monitor and evaluate the portfolio’s performance relative to the chosen market benchmark(s), which will be included in the investment officer’s quarterly report. The investment officer shall select an appropriate, readily available index to use as a market benchmark.

I. REPORTING

1. Methods: The investment officer shall prepare an investment report at least quarterly, including a management summary that provides an analysis of the status of the current 380
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14 investment portfolio and the individual transactions executed over the last quarter. This report shall include the type of investment, issuer, date of maturity, and par and dollar amount invested on all securities, investments and moneys held by the City. The report shall also include a current market value as of the date of the report. It shall state compliance of the portfolio to the statement of investment policy or manner in which the portfolio id not in compliance. Finally, the report shall include a statement denoting the ability of the local agency to meet its pool’s expenditure requirements for the next six months or provide an explanation as to why sufficient money shall, or may, not be available. Once a year, the statement of investment policy shall be included in the report.

2. Performance Standards: The investment portfolio will be managed in accordance with the parameters specified within this policy. The portfolio should obtain a market average rate of return during a market/economic environment of stable interest rates. A series of appropriate benchmarks shall be established against which portfolio performance shall be compared on a regular basis.

3. Marking to Market: The market value of the portfolio shall be calculated at least monthly and a statement of the market value of the portfolio shall be issued at least monthly. This will ensure that review of the investment portfolio, in terms of value and price volatility, has been performed consistent with the GFOA Recommended Practice on “Mark-to-Market Practices for State and Local Government Investment Portfolios and Investment Pools.” In defining market value, considerations should be given to the GASB Statement 31 pronouncement.

4. Annual Reports: The investment policy shall be reviewed at least annually within 120 days of the end of the fiscal year to ensure its consistency with the overall objectives of preservation of principal, liquidity and return, and its relevance to current law and financial and economic trends. A comprehensive annual report shall be presented in conjunction with the investment policy review. This report shall include comparisons of City’s return to the City’s benchmark return, shall suggest policies and improvements that might enhance the investment program, and shall include an investment plan for the coming year.

5. Annual Audit: Management shall establish an annual process of independent review by the external auditor to assure compliance with internal controls. Such audit will include tests deemed appropriate by the auditor.

J. PORTFOLIO AND POLICY CONSIDERATIONS

1. Portfolio Review: The investment officer shall periodically, but no less than quarterly, review the portfolio to identify investments that do not comply with this investment policy and establish protocols for reporting major and critical incidences of noncompliance to the City Council.

2. Policy Amendments: This policy shall be reviewed on an annual basis within 120 days of the end of the fiscal year to ensure its consistency with the overall objectives of preservation of principal, liquidity and return, and its relevance to current law and financial and economic trends. Any recommended modifications or changes shall be presented by the investment officer to the City Council for their consideration and adoption.

K. GLOSSARY OF TERMS
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15 Agencies: Shorthand market terminology for any obligation issued by a government-sponsored entity (GSE), or a federally related institution. Most obligations of GSEs are not guaranteed by the full faith and credit of the US government. Examples are:

FFCB: The Federal Farm Credit Bank System provides credit and liquidity in the agricultural industry. FFCB issues discount notes and bonds.

FHLB: The Federal Home Loan Bank provides credit and liquidity in the housing market.

FHLB issues discount notes and bonds.

FHLMC: Like FHLB, the Federal Home Loan Mortgage Corporation provides credit and liquidity in the housing market. FHLMC, also called “FreddieMac” issues discount notes, bonds and mortgage pass-through securities.

FNMA: Like FHLB and FreddieMac, the Federal National Mortgage Association was established to provide credit and liquidity in the housing market. FNMA, also known as “FannieMae,” issues discount notes, bonds and mortgage pass-through securities.

GNMA: The Government National Mortgage Association, known as “GinnieMae,” issues mortgage pass-through securities, which are guaranteed by the full faith and credit of the US Government.

PEFCO: The Private Export Funding Corporation assists exporters. Obligations of PEFCO are not guaranteed by the full faith and credit of the US government.

TVA: The Tennessee Valley Authority provides flood control and power and promotes development in portions of the Tennessee, Ohio, and Mississippi River valleys. TVA currently issues discount notes and bonds.

Asset Backed Securities: Securities supported by pools of installment loans or leases or by pools of revolving lines of credit.

Average Life: In mortgage-related investments, including CMOs, the average time to expected receipt of principal payments, weighted by the amount of principal expected.

Banker’s Acceptance: A money market instrument created to facilitate international trade transactions. It is highly liquid and safe because the risk of the trade transaction is transferred to the bank which “accepts” the obligation to pay the investor.

Benchmark: A comparison security or portfolio. A performance benchmark is a partial market index, which reflects the mix of securities allowed under a specific investment policy.

Broker: A broker brings buyers and sellers together for a transaction for which the broker receives a commission. A broker does not sell securities from his own position.

Callable: A callable security gives the issuer the option to call it from the investor prior to its maturity. The main cause of a call is a decline in interest rates. If interest rates decline, the issuer will likely call its current securities and reissue them at a lower rate of interest.

Certificate of Deposit (CD): A time deposit with a specific maturity evidenced by a certificate.

Certificate of Deposit Account Registry SYSTEM (CDARS): A private placement service that allows local agencies to purchase more than $250,000 in CDs from a single financial institution (must be a participating institution of CDARS) while still maintaining FDIC insurance coverage.

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16 between the California institution and other participating institutions in amounts that are less than $250,000 each, so that FDIC coverage is maintained.

Collateral: Securities or cash pledged by a borrower to secure repayment of a loan or repurchase agreement. Also, securities pledged by a financial institution to secure deposits of public monies.

Collateralized Bank Deposit: A bank deposit that is collateralized at least 100% (principal plus interest to maturity). The deposit is collateralized using assets set aside by the issuer such as Treasury securities or other qualified collateral to secure the deposit in excess of the limit covered by the Federal Deposit Insurance Corporation.

Collateralized Mortgage Obligations (CMO): Classes of bonds that redistribute the cash flows of mortgage securities (and whole loans) to create securities that have different levels of prepayment risk, as compared to the underlying mortgage securities.

Collateralized Time Deposit: Time deposits that are collateralized at least 100% (principal plus interest to maturity). These instruments are collateralized using assets set aside by the issuer such as Treasury securities or other qualified collateral to secure the deposit in excess of the limit covered by the Federal Deposit Insurance Corporation.

Commercial Paper: The short-term unsecured debt of corporations.

Coupon: The rate of return at which interest is paid on a bond.

Credit Risk: The risk that principal and/or interest on an investment will not be paid in a timely manner due to changes in the condition of the issuer.

Dealer: A dealer acts as a principal in security transactions, selling securities from and buying securities for his own position.

Debenture: A bond secured only by the general credit of the issuer.

Delivery vs. Payment (DVP): A securities industry procedure whereby payment for a security must be made at the time the security is delivered to the purchaser’s agent.

Derivative: Any security that has principal and/or interest payments which are subject to uncertainty (but not for reasons of default or credit risk) as to timing and/or amount, or any security which represents a component of another security which has been separated from other components (“Stripped” coupons and principal). A derivative is also defined as a financial instrument the value of which is totally or partially derived from the value of another instrument, interest rate, or index.

Discount: The difference between the par value of a bond and the cost of the bond, when the cost is below par. Some short-term securities, such as T-bills and banker’s acceptances, are known as discount securities. They sell at a discount from par and return the par value to the investor at maturity without additional interest. Other securities, which have fixed coupons, trade at a discount when the coupon rate is lower than the current market rate for securities of that maturity and/or quality.

Diversification: Dividing investment funds among a variety of investments to avoid excessive exposure to any one source of risk.

Duration: The weighted average time to maturity of a bond where the weights are the present values of the future cash flows. Duration measures the price sensitivity of a security to changes interest rates.

Federal Deposit Insurance Corporation (FDIC): The Federal Deposit Insurance Corporation (FDIC) is an independent federal agency insuring deposits in U.S. banks and thrifts in the event 383
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17 of bank failures. The FDIC was created in 1933 to maintain public confidence and encourage stability in the financial system through the promotion of sound banking practices.

Federally Insured Time Deposit: A time deposit is an interest-bearing bank deposit account that has a specified date of maturity, such as a certificate of deposit (CD). These deposits are limited to funds insured in accordance with FDIC insurance deposit limits.

Leverage: Borrowing funds in order to invest in securities that have the potential to pay earnings at a rate higher than the cost of borrowing.

Liquidity: The speed and ease with which an asset can be converted to cash.

Local Agency Investment Fund (LAIF): A voluntary investment fund open to government entities and certain non-profit organizations in California that is managed by the State Treasurer’s Office.

Local Government Investment Pool: Investment pools that range from the State Treasurer’s Office Local Agency Investment Fund (LAIF) to county pools, to Joint Powers Authorities (JPAs).

These funds are not subject to the same SEC rules applicable to money market mutual funds.

Make Whole Call: A type of call provision on a bond that allows the issuer to pay off the remaining debt early. Unlike a call option, with a make whole call provision, the issuer makes a lump sum payment that equals the net present value (NPV) of future coupon payments that will not be paid because of the call. With this type of call, an investor is compensated, or "made whole." Margin: The difference between the market value of a security and the loan a broker makes using that security as collateral.

Market Risk: The risk that the value of securities will fluctuate with changes in overall market conditions or interest rates.

Market Value: The price at which a security can be traded.

Maturity: The final date upon which the principal of a security becomes due and payable.

Medium Term Notes: Unsecured, investment-grade senior debt securities of major corporations which are sold in relatively small amounts on either a continuous or an intermittent basis. MTNs are highly flexible debt instruments that can be structured to respond to market opportunities or to investor preferences.

Modified Duration: The percent change in price for a 100-basis point change in yields. Modified duration is the best single measure of a portfolio’s or security’s exposure to market risk.

Money Market: The market in which short-term debt instruments (T-bills, discount notes, commercial paper, and banker’s acceptances) are issued and traded.

Money Market Mutual Fund: A mutual fund that invests exclusively in short-term securities.

Examples of investments in money market funds are certificates of deposit and U.S. Treasury securities. Money market funds attempt to keep their net asset values at $1 per share.

Mortgage Pass-Through Securities: A securitized participation in the interest and principal cash flows from a specified pool of mortgages. Principal and interest payments made on the mortgages are passed through to the holder of the security.

Municipal Securities: Securities issued by state and local agencies to finance capital and operating expenses.

Mutual Fund: An entity which pools the funds of investors and invests those funds in a set of securities which is specifically defined in the fund’s prospectus. Mutual funds can be invested in various types of domestic and/or international stocks, bonds, and money market instruments, as set forth in the individual fund’s prospectus. For most large, institutional investors, the costs 384
Administrative Policy IV-C-2
Investment Policy
(continued)
18 associated with investing in mutual funds are higher than the investor can obtain through an individually managed portfolio.

Nationally Recognized Statistical Rating Organization (NRSRO): A credit rating agency that the Securities and Exchange Commission in the United States uses for regulatory purposes. Credit rating agencies provide assessments of an investment's risk. The issuers of investments, especially debt securities, pay credit rating agencies to provide them with ratings. The three most prominent NRSROs are Fitch, S&P, and Moody's.

Negotiable Certificate of Deposit (CD): A short-term debt instrument that pays interest and is issued by a bank, savings or federal association, state or federal credit union, or state-licensed branch of a foreign bank. Negotiable CDs are traded in a secondary market and are payable upon order to the bearer or initial depositor (investor).

Primary Dealer: A financial institution (1) that is a trading counterparty with the Federal Reserve in its execution of market operations to carry out U.S. monetary policy, and (2) that participates for statistical reporting purposes in compiling data on activity in the U.S. Government securities market.

Prudent Person (Prudent Investor) Rule: A standard of responsibility which applies to fiduciaries.

In California, the rule is stated as “Investments shall be managed with the care, skill, prudence and diligence, under the circumstances then prevailing, that a prudent person, acting in a like capacity and familiar with such matters, would use in the conduct of an enterprise of like character and with like aims to accomplish similar purposes.”
Repurchase Agreement: Short-term purchases of securities with a simultaneous agreement to sell the securities back at a higher price. From the seller’s point of view, the same transaction is a reverse repurchase agreement.

Safekeeping: A service to bank customers whereby securities are held by the bank in the customer’s name.

Securities and Exchange Commission (SEC): The U.S. Securities and Exchange Commission (SEC) is an independent federal government agency responsible for protecting investors, maintaining fair and orderly functioning of securities markets and facilitating capital formation. It was created by Congress in 1934 as the first federal regulator of securities markets. The SEC promotes full public disclosure, protects investors against fraudulent and manipulative practices in the market, and monitors corporate takeover actions in the United States.

Securities and Exchange Commission (SEC) Rule 15c3-1: An SEC rule setting capital requirements for brokers and dealers. Under Rule 15c3-1, a broker or dealer must have sufficient liquidity in order to cover the most pressing obligations. This is defined as having a certain amount of liquidity as a percentage of the broker/dealer's total obligations. If the percentage falls below a certain point, the broker or dealer may not be allowed to take on new clients and may have restrictions placed on dealings with current client.

Structured Note: A complex, fixed income instrument, which pays interest, based on a formula tied to other interest rates, commodities or indices. Examples include inverse floating rate notes which have coupons that increase when other interest rates are falling, and which fall when other interest rates are rising, and "dual index floaters," which pay interest based on the relationship between two other interest rates - for example, the yield on the ten-year Treasury note minus the Libor rate. Issuers of such notes lock in a reduced cost of borrowing by purchasing interest rate swap agreements.
385
Administrative Policy IV-C-2
Investment Policy
(continued)
19 Supranational: A Supranational is a multi-national organization whereby member states transcend national boundaries or interests to share in the decision making to promote economic development in the member countries.

Total Rate of Return: A measure of a portfolio’s performance over time. It is the internal rate of return, which equates the beginning value of the portfolio with the ending value; it includes interest earnings, realized and unrealized gains, and losses in the portfolio.

Treasury Bills: All securities issued with initial maturities of one year or less are issued as discounted instruments and are called Treasury bills. The Treasury currently issues three- and six-month T-bills at regular weekly auctions. It also issues “cash management” bills as needed to smooth out cash flows.

Treasury Bonds: All securities issued with initial maturities greater than ten years are called Treasury bonds. Like Treasury notes, they pay interest semi-annually.

Treasury Notes: All securities issued with initial maturities of two to ten years are called Treasury notes and pay interest semi-annually.

U.S. Treasury Obligations: Securities issued by the U.S. Treasury and backed by the full faith and credit of the United States. Treasuries are considered to have no credit risk and are the benchmark for interest rates on all other securities in the US and overseas. The Treasury issues both discounted securities and fixed coupon notes and bonds.

Yield to Maturity: The annualized internal rate of return on an investment which equates the expected cash flows from the investment to its cost.
386

CITY COUNCIL AGENDA REPORT
MEETING DATE: June 7, 2022 ITEM # 14
SUBJECT:

CONSIDERATION OF RESOLUTION 23-19 AUTHORIZING THE COLLECTION OF

SPECIAL TAX ON THE SECURED ROLL IN THE SAME MANNER AS THE ORDINARY AD

VALOREM PROPERTY TAXES FOR EXISTING COMMUNITY FACILITY DISTRICTS FOR

AUTHORIZED CAPITAL FACILITY CONSTRUCTION PURPOSES
INITIATED OR REQUESTED BY: REPORT COORDINATED OR PREPARED BY:
[ ] Council [X] Staff
[ ] Other
Marc Rotteveel, Finance Analyst
Department of Finance
ATTACHMENT [X] Yes [ ] No [ ] Information [ ] Direction [X] Action

OBJECTIVE
The purpose of this action is to collect a special tax associated with Community Facility Districts (CFDs) previously established by the City to fund capital improvements and make debt service payments on outstanding bond debt, and to have these taxes placed on the Yolo County secured property tax bill.

RECOMMENDED ACTION
Staff respectfully recommends that the City Council adopt Resolution 23-19 authorizing the collection of a special tax and the placing of these taxes on the secured tax roll to be collected in the same manner as the ordinary ad valorem property taxes. Furthermore, the actions recognize that the collection of taxes will be used to pay outstanding bond debt and other purposes previously authorized by the City.

BACKGROUND
Since the City’s incorporation in 1987, the City has formed a number of special financing districts to fund capital improvements which are secured by land-based special taxes. This report deals with 17 “infrastructure” financing districts managed by the City. Under the 1982 “Mello-Roos Act,” cities may issue municipal bonds to finance development projects with high capital costs and pay these costs over time by taxing property owners within the established district. If voters in the area have elected to become a Mello-Roos district, they are responsible for the repayment of these bonds through a special tax, imposed annually based on the Rate and Method of Apportionment of Special Tax approved by owners within the CFDs.

Accordingly, the following CFDs were established for the financing of certain capital improvements in and for the District:

Community Facilities District 8
Community Facilities District 9
Community Facilities District 10
Community Facilities District 11
Community Facilities District 12
Community Facilities District 14
Community Facilities District 15
Community Facilities District 16
Community Facilities District 17
Community Facilities District 18
Community Facilities District 19
Community Facilities District 20
Community Facilities District 21
Community Facilities District 23
Community Facilities District 24
Community Facilities District 27
Community Facilities District 29
387
Resolution 23-19
June 7, 2023

ANALYSIS
Commencing in fiscal year 2010-2011, the Treasurer-Tax Collector’s Office at the County of Yolo has required that all special tax levies placed on the property tax rolls include an authorization approved by the City Council, and specifically identifies that the taxes collected will be used to make payments on outstanding bonded indebtedness and other authorized purposes. The authorization described in Resolution 23-19 outlines the terms of the agreement between the County and the City for collecting the CFDs’ levies used to make debt service payments.

The City also manages the placement of special taxes on the property tax rolls associated with “service” CFDs (service CFDs pay for maintenance of improvements once they are constructed), which is being addressed in a separate agenda report also scheduled for June 7, 2023.

Environmental Considerations
Not applicable
Commission Recommendation
Not applicable
Strategic Plan Integration
The adoption of special taxes to finance public facilities helps establish a strong financial base for the City.

Alternatives
While the Council may alternatively delay an action approving the levy of a special tax, the City is bound to levy the special tax on an annual basis pursuant to each bond issuance. The placement of special taxes on the tax roll is necessary to collect these taxes which secure outstanding bonded indebtedness. The respective bond documents for each district commit the City to collect these revenues to make required debt payments.

Coordination and Review
Yolo County has provided a draft resolution and reserved space on the fiscal year 2023-2024 tax roll.

Budget/Cost Impact
Fees for services such as these support a higher level of service than can be supported by general taxes alone.

The taxes include a city administrative fee to offset the staff costs of managing the districts and related debt obligations.

ATTACHMENTS

1. Resolution 23-19

2. Facility CFD Map (Numeric)
388
Attachment 1
RESOLUTION 23-19

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF WEST SACRAMENTO

AUTHORIZING THE COLLECTION OF SPECIAL TAX ON THE SECURED TAX ROLL

IN THE SAME MANNER AS THE ORDINARY AD VALOREM PROPERTY TAXES FOR

EXISTING ASSESSMENT DISTRICTS AND COMMUNITY FACILITY DISTRICTS FOR

AUTHORIZED CAPITAL FACILITY CONSTRUCTION PURPOSES
WHEREAS, the City of West Sacramento (hereinafter “City) requests the County of Yolo collect on the County tax rolls certain charges which have been imposed pursuant to section 53340 of Government Code of the State of California by the City for the following Districts:

Community Facilities District 8
Community Facilities District 9
Community Facilities District 10
Community Facilities District 11
Community Facilities District 12
Community Facilities District 14
Community Facilities District 15
Community Facilities District 16
Community Facilities District 17
Community Facilities District 18
Community Facilities District 19
Community Facilities District 20
Community Facilities District 21
Community Facilities District 23
Community Facilities District 24
Community Facilities District 27
Community Facilities District 29
and;
WHEREAS, the County has required as a condition of the collection of said charges that the City warrant the legality of said charges and defend and indemnify the County from any challenge to the legality thereof.

NOW, THEREFORE, BE IT RESOLVED that the City Council does hereby authorize, as follows:

1. The Auditor-Controller of Yolo County is requested to attach for collection on the County tax rolls those taxes, assessments, fees and/or charges, described in the recitals above.

2. The City warrants and represents that the taxes, assessments, fees and/or charges imposed by the City and being requested to be collected by Yolo County comply with all requirements of State law, including but not limited to Articles XIIIC and XIIID of the California Constitution (Proposition 218).

3. The City agrees to and shall defend, indemnify and hold harmless the County, its officers, agents and employees (the "Indemnified Parties") from any and all claims, demands, liabilities, costs and expenses, damages, causes of action, and judgments, in any manner arising out of the collection by County of any of City's said taxes, assessments, fees and/or charges requested to be collected by County for City, or in any manner arising out of City's establishment and imposition of said taxes, assessments, fees and/or charges. City agrees that, in the event a judgment is entered in a court of law against any of the Indemnified Parties as a result of the collection of one of City's taxes, assessments, fees and/or charges, the County may offset the amount of the judgment from any other monies collected by County on behalf of City, including property taxes.
389
Resolution 23-19

4. The City agrees that its officers, agents and employees will cooperate with the County in answering questions referred to City by County from any person concerning the City's taxes, assessments, fees and/or charges, and that City will not refer such persons to County officers and employees for response.

5. The City agrees to pay such reasonable and ordinary charges as the County may prescribe to recoup its costs in placing on the tax rolls and collecting the taxes, assessments, fees and/or charges, as provided by Government Code sections 29304 and 51800.

PASSED AND ADOPTED by the West Sacramento City Council, this 7th day of June, 2023, by the following vote:

AYES:

NOES:

ABSENT:

Martha Guerrero, Mayor
ATTEST:

Jennifer Cusmir, City Clerk
390
!"#$80
(/50 )*+,-80
!"#$5
!"#$80 !"#$5
0 1.1 Mile
8 )*+,-80
!"#$5
!"#$80 !"#$5
!"#$80
City Of West Sacramento May 2022 I.T. Division (916) 617-4529 26 1:32054
6 Riverpoint
8 Southport Industrial Park
9 Staple Project
10 Bridgeway Island
11 Southport Gateway
12 Raley's Field
14 Newport Estates
15 Pheasant Hollow
16 Bridgeway Lakes
17 Marshall Crossing & Parella
18 Southport Gateway unit 4
19 River Ranch
20 Bridgeway Lakes II
21 Palin Ranch Construction
23 Triangle Area
24 Bridgeway Lake North
26 Yarbrough
27 Bridge District
29 Port Towne
8 10
16 20
24 17
11 17
14 18
19 21
15 City of West Sacramento
Community "Facility" Districts 2022
CFD Numeric Districts
\MAPPING\CITY_DATA\DEPARTMENTS\FINANCE\CURRENT\PROJECTS\COWS_CFD_MAPS\2022 1 in = 0.51 miles
12 23
23 27
9 6
27 0 0.275 0.55 1.1
Miles
29 Attachment 2
391

CITY COUNCIL AGENDA REPORT
MEETING DATE: June 7, 2023 ITEM # 15
SUBJECT:

CONSIDERATION OF RESOLUTION 23-46 AUTHORIZING THE COLLECTION OF

SPECIAL TAX ON THE SECURED TAX ROLL IN THE SAME MANNER AS THE

ORDINARY AD VALOREM PROPERTY TAXES IN ORDER TO PAY FOR CERTAIN

MAINTENANCE SERVICES
INITIATED OR REQUESTED BY: REPORT COORDINATED OR PREPARED BY:
[ ] Council [X] Staff
[ ] Other
Marc Rotteveel, Finance Analyst
Finance Department
ATTACHMENT [X] Yes [ ] No [ ] Information [ ] Direction [X] Action

OBJECTIVE
The purpose of this action is to collect special tax to pay for certain existing Community Facility District (CFD) maintenance services and to have these taxes placed on the Yolo County secured property tax bill.

RECOMMENDED ACTION
Staff respectfully recommends that the City Council adopt Resolution 23-46 authorizing the collection of special tax to pay for certain Community Facility District maintenance services on the secured tax roll in the same manner as the ordinary ad valorem property taxes.

BACKGROUND
Since the City’s incorporation in 1987, all tentative subdivision maps contain, as a condition of approval, measures for maintaining street landscaping and lighting.

Accordingly, the following CFDs were established for the financing of certain maintenance services in and for the Districts:

Community Facilities District A (Gateway)
Community Facilities District B (Newport Estates)
Community Facilities District C (Bridgeway Island)
Community Facilities District D (Southport Industrial Park) Community Facilities District E (The Classics)
Community Facilities District F (Pheasant Hollow)
Community Facilities District G (Gateway Unit IV)
Community Facilities District H (Bridgeway Lakes)
Community Facilities District I (River Ranch)
Community Facilities District J (Parella)
Community Facilities District M (The Rivers)
Community Facilities District N (Parlin)
Community Facilities District O (Linden South)
Community Facilities District P (Ironworks)
Community Facilities District R (Bridge District)
Community Facilities District S (Port Towne)
The City determines the annual maintenance costs for each service district for the fiscal year. Next, the City prepares a list of the parcels subject to the special tax using the records of the County Assessor and other records of the City. The maximum annual special tax per unit has a 4-percent escalation factor each year starting with the base year (the year in which the district was formed). Next, the City determines the special tax revenues available by taxing each final unit parcel up to 100 percent of the maximum annual special tax rate. The City requests the County of Yolo to collect on the County property tax rolls the special taxes levied on each parcel by the respective service district.

ANALYSIS
Commencing in fiscal year 2009-2010, the Treasurer-Tax Collector’s Office at the County of Yolo has required that all special tax levies placed on the property tax rolls include an authorization approved by the City Council.

The authorization outlines the terms of the agreement between the County and the City for collecting the CFDs’ service charges.
392
Resolution 23-46
June 7, 2023

The City also manages the placement of taxes on the property tax rolls associated with “Infrastructure” CFDs (CFDs that pay for the construction of capital facility improvements which are usually funded by the issuance of bonds), which is being addressed in a separate agenda report also scheduled for June 7, 2023.

Environmental Considerations
Not applicable
Commission Recommendation
Not applicable
Strategic Plan Integration
Adoption of special taxes and fees for service help establish the strong financial base necessary to provide quality services.

Alternatives
Not applicable
Coordination and Review
Yolo County has provided a draft resolution and reserved space on the fiscal year 2023-2024 tax roll.

Budget/Cost Impact
Special taxes for services such as these support a higher level of service than can be supported by general taxes alone. Annual maintenance services in these CFD areas are fully supported by the special tax.

ATTACHMENTS

1. Resolution 23-46

2. Maintenance Services CFD Map
393
Attachment 1
RESOLUTION 23-46

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF WEST SACRAMENTO

AUTHORIZING THE COLLECTION OF SPECIAL TAX ON THE SECURED TAX ROLL

IN THE SAME MANNER AS THE ORDINARY AD VALOREM PROPERTY TAXES IN

ORDER TO PAY FOR CERTAIN MAINTENANCE SERVICES
WHEREAS, the City of West Sacramento (hereinafter “City”) requests the County of Yolo collect on the County tax rolls certain charges which have been imposed pursuant to Section 53340 of Government Code of the State of California by the City for the following Districts:

Community Facilities District A (Gateway)
Community Facilities District B (Newport Estates)
Community Facilities District C (Bridgeway Island)
Community Facilities District D (Southport Industrial Park) Community Facilities District E (The Classics)
Community Facilities District F (Pheasant Hollow)
Community Facilities District G (Gateway Unit IV)
Community Facilities District H (Bridgeway Lakes)
Community Facilities District I (River Ranch)
Community Facilities District J (Parella)
Community Facilities District M (The Rivers)
Community Facilities District N (Parlin)
Community Facilities District O (Linden South)
Community Facilities District P (Ironworks)
Community Facilities District R (Bridge District)
Community Facilities District S (Port Towne)
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of West Sacramento that:

1. The special tax shall be collected on the secured real property tax roll in the same manner as ordinary ad valorem taxes are collected. The special tax shall have the same lien priority and be subject to the same penalties and the same procedure and sale in cases of delinquency as provided for ad valorem taxes. In addition, the provisions of Section 53356.1 of the Act shall apply to delinquent special tax payments. The Finance Director is authorized and directed to provide all necessary information to the Treasurer-Tax Collector of Yolo County and to otherwise take all actions necessary in order to effect proper billing and collection of the special tax, so that the special tax is levied and collected in sufficient amounts and at times necessary to satisfy the financial obligations of the District in each fiscal year.

2. The City agrees, upon reasonable written notice by Yolo County of any claim or challenge, to defend with counsel of its choice, indemnify and hold harmless Yolo County, its Board of Supervisors, officers, officials, agents and employees (collectively “the County”) against the payment of any liabilities, losses, costs and expenses, including attorneys’ fees and court costs, not due to the County’s own negligence or willful misconduct, which the County may incur in the exercise and performance of its powers and duties in placing these assessments onto the County roll and tax bills for the City.

3. The City agrees to pay such reasonable and ordinary charges as the County may prescribe to recoup its costs in placing on the tax rolls and collecting the taxes, assessments, fees and/or charges, as provided by the Government Code sections 29304 and 51800.

4. The City warrants and represents that the taxes, assessments, fees and/or charges imposed by the City and being requested to be collected by Yolo County comply with all requirements of State law, including but not limited to Articles XIIIC and XIIID of the California Constitution (Proposition 218).
394
Resolution 23-46

PASSED AND ADOPTED by the West Sacramento City Council, this 7th day of June, 2023, by the following vote:

AYES:

NOES:

ABSENT:

Martha Guerrero, Mayor
ATTEST:

Jennifer Cusmir, City Clerk
395
CFD B
CFD R
CFD M-T2
CFD M-T1
CFD N-T2
CFD I
CFD G
CFD P
CFD O
CFD D
CFD C
CFD J
CFD H-T3
CFD E
CFD A
CFD H-T1
CFD F
CFD S
CFD H-T4
CFD R
CFD H-T2
CFD O
CFD N-T1
5 5
80 80
80 50
)*+,-80
!"#$5
!"#$ !"#$5 80
!"#$80
8 \MAPPING\CITY_DATA\DEPARTMENTS\FINANCE\CURRENT\PROJECTS\COWS_CFD_MAPS\2022 City Of West Sacramento May 2022 I.T. Division (916) 617-4529 0 1 Mile
1:28000 1 in = 0.44 miles
CFD A
CFD B
CFD C
CFD D
CFD E
CFD F
CFD G
CFD H-T1
CFD H-T2
CFD H-T3
CFD H-T4
CFD I
CFD J
CFD M-T1
CFD M-T2
CFD N-T1
CFD N-T2
CFD O
CFD P
CFD R
CFD S
City of City of
West West
Sacramento Sacramento
Community Community
"Facility" "Facility"
Districts Districts
Attachment 2
396

CITY COUNCIL AGENDA REPORT
MEETING DATE: June 7, 2023 ITEM # 16
SUBJECT:

CONSIDERATION OF RESOLUTION INITIATING THE LEVY OF ANNUAL ASSESSMENTS FOR LANDSCAPING AND LIGHTING DISTRICT NO. 1 INITIATED OR REQUESTED BY: REPORT COORDINATED OR PREPARED BY:
[ ] Council [X] Staff
[ ] Other
Marc Rotteveel, Finance Analyst
Department of Finance
ATTACHMENT [X] Yes [ ] No [ ] Information [ ] Direction [X] Action

OBJECTIVE
The objective of this report is to provide sufficient information to Council to adopt Resolution 23-47 initiating the levy of annual assessments for Landscaping and Lighting District #1.

RECOMMENDED ACTION
Staff respectfully recommends that the City Council adopt Resolution 23-47, a Resolution of Intention initiating the levy of annual assessments for the Landscaping and Lighting District No. 1 and establish the date of July 19, 2023 for a public hearing under the Landscaping and Lighting Act of 1972.

BACKGROUND
State law provides for an annual proceeding prior to levying an ongoing assessment. The recommended action is the first step in this process. Because staff is not proposing an increase in assessments, this action does not trigger voter approval under Proposition 218.

Each year, the City levies assessments to pay for maintenance services and is required to take specific actions prior to transmitting the assessment to the Yolo County Assessor for inclusion on property owner tax bills.

On June 17, 1987, the City Council adopted Resolution 87-102 approving the formation of West Sacramento Lighting and Landscaping District No. 1 (“the District”), pursuant to the Landscaping and Lighting Act of 1972 (“the 1972 Act”). On April 1989, the City Council approved an amendment to the District that included: 1) an annexation of additional parcels into the S2 (Street Lighting) benefit zone, and 2) an annexation of additional parcels into Zone L1 (Landscaping).

The District provides street lighting and street landscaping maintenance services for property within the City of West Sacramento. It is divided into six zones, which include the original district and subsequent annexations noted above. Each zone is comprised of a group of parcels that enjoys similar degrees of benefit from the service covered by the zone. Each parcel within the various zones is assessed with its proportionate share of the cost of providing the service. The proportionate benefit and assessment is calculated in a benefit unit appropriate to the zone, depending on the type of service provided. The services provided and the unit of benefit for each zone in the district are shown below:

Zone Service Unit of Benefit Land Use Type
S1 Street Lighting Per Parcel Residential
S2 Street Lighting Front Footage Industrial
LS1 Street Lighting & Maintenance Front Footage Commercial L1 Maintenance Parcel Acreage Industrial
L2 Maintenance Per Parcel Residential
LSP2 Street Lighting & Maintenance Parcel Acreage Residential/Commercial Because each zone represents a different level of service and/or a different unit of benefit, each has a different assessment. Assessments are set each year by the City Council and are collected by Yolo County on the regular property tax bill.

ANALYSIS
The 1972 Act District was formed prior to enactment of Proposition 218 (“Prop 218”); an initiative approved by the voters in 1996 that imposed requirements on the manner in which local governments could raise taxes and assessments. For instance, any proposed increase in the rate for this District would be subject to super-majority 397 Resolution 23-47
June 7, 2023

approval by the voters pursuant to Prop 218. Hence, the City has chosen not to increase the rate for 2023-2024, as has been the case in previous years. The total assessment can change from year to year based on changes in parcellation within the District, an assessment factor that is described below, but the rate remains the same.

The 1972 Act requires that the City Council undertake annual proceedings for each fiscal year during which an assessment is to be levied and collected with the District. A report describing the manner in which the assessments are established is provided prior to a public hearing so that property owners may review and comment on the proposed assessment for the next fiscal year.

The City of West Sacramento Landscaping and Street Lighting District No. 1 Report for 2023-2024 is included as an attachment to this report and is referenced in Resolution 23-47. The report describes the method of assessment, budget, and rate schedule for the District for 2023-2024.

There are two steps in determining the appropriate fee:

1. Service costs must be allocated to each zone. Maintenance costs are allocated on a time and materials basis. Street lighting costs are allocated by the style of light and by the number of lights in each zone.

2. Zone costs are allocated to each property owner. On January 11, 1989, Council approved the following methods of allocation:
 Residential Lighting & Maintenance - per parcel
 Commercial Lighting & Maintenance - front footage
 Industrial Maintenance - parcel area (acreage)
 Industrial Lighting - front footage
Accordingly, the report for 2023-2024 incorporates these two steps in determining the diagram and assessments for 2023-2024. It consists of three parts: (i) a narrative, (ii) a proposed budget, and (iii) a rate schedule.

The proposed budget for the District in 2023-2024 is $1,317355. Because of the limitation on the ability to increase rates, budget increases for the District must also be offset by some amount of subsidy. The assessment for 2023-2024 is projected to generate revenues of $393,862. Therefore, the subsidy from the City’s Measure K Fund is projected to be $923,493.

Resolution 23-47 preliminarily accepts the Report for 2023-2024 and sets a public hearing for Wednesday, July 19, 2023.

Environmental Considerations
Not applicable
Commission Recommendation
Not applicable
Strategic Plan Integration
The City has a Strategic Plan goal to achieve a Financially Sound City Government. Ongoing management of existing financing districts is a critical tool available to the Finance Department to achieve this goal.

Alternatives
As an alternative to the proposed action, the City Council may choose to continue this item and or modify the date for the proposed public hearing. The deadline for submitting the levy to the County for inclusion on the 2023-2024 tax roll is August 10, 2023, and holding a public hearing is a requirement for submitting the levy. If Council selects to continue this item or set a different date for the public hearing, a special meeting may be required.

Coordination and Review
Not applicable.

Budget/Cost Impact
Assessments for services such as these support a higher level of service than can be supported by general taxes alone. In fiscal year 2023-2024, a projected additional contribution of $923,493 from the Measure K Fund is required to maintain this service.
398
Resolution 23-47
June 7, 2023

ATTACHMENTS

1. Resolution 23-47

2. Report for 2023-2024
399
Attachment 1
RESOLUTION 23-47

A RESOLUTION OF INTENTION OF THE CITY OF WEST SACRAMENTO INITIATING THE LEVY OF ANNUAL ASSESSMENTS FOR LANDSCAPING AND LIGHTING DISTRICT NO. 1 WHEREAS, the City Council (the "Council") of the City of West Sacramento (the "City") adopted Resolution 87-102 on June 17, 1987, ordering the formation of the City of West Sacramento Landscaping and Lighting District No. 1 (the "Assessment District") pursuant to the Landscaping and Lighting Act of 1972, being California Streets and Highways Code sections 22500 et seq., (the "Act"); and
WHEREAS, the Act requires the Council to undertake proceedings annually for any fiscal year during which an assessment is to be levied and collected within an existing Assessment District; and
WHEREAS, pursuant to Resolution 92-45, adopted on June 10, 1992, the Council has appointed the Finance Manager as Engineer for the Assessment District for purposes of the annual proceedings; and
WHEREAS, the Finance Manager has prepared and filed with the City Clerk a report for assessments to be levied in fiscal year 2023-2024 in accordance with the Act.

NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of West Sacramento as follows:

Section 1. Recitals. The foregoing recitals are true and correct, and this Council so finds and determines.

Section 2. Approval of Report for 2023-2024. This Council hereby approves the Report for 2023-2024 as filed.

Section 3. Declaration of Intention. This Council hereby declares its intention to levy and collect assessments in the City of West Sacramento Landscaping and Lighting District No. 1 for fiscal year 2023-2024.

Section 4. Description of Improvements. The improvements proposed to be financed by the Assessment District are the maintenance and servicing public lighting facilities, and streets.

Section 5. Location of District. The City of West Sacramento Landscaping and Lighting District No. 1 encompasses parcels throughout the City.

Section 6. Reference to Report for Particulars. A full and detailed description of the improvements, the boundaries of the Assessment District and the six zones of benefit, and the proposed assessments upon assessable lots and parcels of land within the district is set forth in the Report for 2023-2024. The Report recommends no change in assessments and is on file in the office of the Director of Finance, 1110 West Capitol Avenue, West Sacramento, CA 95691, and is available for review by any interested member of the public during normal business hours.

Section 7. Notice of Public Hearing. On Wednesday, July 19, 2023, 7:00 p.m., at the City Council Chambers, 1110 West Capitol Avenue, West Sacramento, California, the City Council shall hold a public hearing on the levy of the proposed assessment.

Section 8. Publication of Notice. The City Clerk is directed to give notice of the public hearing by publishing notice of the public hearing in accordance with normal City practice.

PASSED AND ADOPTED by the West Sacramento City Council this 7th day of June 2023, by the following vote:
400
Resolution 23-47

AYES:

NOES:

ABSENT:

Martha Guerrero, Mayor
ATTEST:

Jennifer Cusmir, City Clerk
401
Attachment 2

CITY OF WEST SACRAMENTO

LANDSCAPING AND STREET LIGHTING
DISTRICT #1
REPORT FOR 2023-2024
By

MARC ROTTEVEEL

FINANCE ANAYLST
402
2 INTRODUCTION
The West Sacramento Landscaping and Lighting District #1 provides street lighting and/or landscape maintenance construction and operation services for property within the City of West Sacramento. Previously these services were provided by the former East Yolo Community Services District and Yolo County, California, under the following assessment districts and service area:

Elkhorn Village Lighting District
Westfield Village Lighting Maintenance District
Oaks Lighting District
Arlington Oaks Lighting Maintenance District
West Capitol Avenue Landscaping Assessment District
Yolo County Service area #4 (portion including Touchstone CSA, & Port Center CSA) Port of Sacramento Industrial Park Landscaping Assessment District (proposed, not active in 1986-87)
In 1989, the district was amended by the City to provide an equitable assessment to each parcel for the landscaping and street lighting benefit. Several zones were consolidated so that parcels that were more or less similarly benefited were grouped together and assessed by the same method of apportionment. All zones were analyzed in terms of the current land uses and how they may affect the way parcels benefit, how the particular improvement benefits each parcel and how the parcel dimensions affect the way individual parcels may benefit. Later development in the northeast section of West Sacramento created a need for two new assessment areas, which were established in May 1989. The two new assessment areas added were the S-1 Residential Street Lighting Zones, and the S-2 Industrial Street Lighting Zones. Maps of the L&L No. 1 zones are included as Exhibit “A”. It should be noted that the District was formed without an annual Construction Cost Index (CCI) escalator, and therefore costs still reflect those included at the time of formation in 1989.

EXPLANATION OF ZONES
The West Sacramento Landscaping and Lighting District #1 is divided into six zones. Each zone is comprised of the group of parcels that enjoy similar degrees of benefit from the service covered by the zone. Each parcel within the various zones is assessed its proportionate share of the cost of providing the service. The proportionate benefit and assessment is calculated in a benefit unit appropriate to the zone depending on the type of service provided. The services provided and the unit of benefit for each zone in the district is shown below:

Zone Service Unit of Benefit Land Use Type
S1 Street Lighting Per Parcel Residential
S2 Street Lighting Front Footage Industrial
LS1 Street Lighting & Maintenance Front Footage Commercial L1 Maintenance Parcel Acreage Industrial
L2 Maintenance Per Parcel Residential
LSP2 Street Lighting & Maintenance Parcel Acreage Residential/ Commercial
403
3 METHODS OF APPORTIONMENT
As can be seen in the above table, there are many methods of benefit which can be used as a base of assessment. The units of benefit can vary from zone to zone due to the variety of land uses, parcel dimensions and benefits derived.

DESCRIPTION
Each zone is described in terms of the method of assessment used to assess the parcels in the zone. Previous reports determine which method of apportionment to be used.

These methods are briefly described as follows:

ZONE S1: The first zone is a street lighting zone located in the residential region of the City of West Sacramento. The parcels are more or less of similar size and the street lighting diagrams indicate the streetlights are dispersed rather evenly through the zone. The method of assessment is per parcel.

ZONE S2: Zone 2 is a street lighting zone in an industrial region. It is comprised of parcels of quite different dimensions and acreages. This variety of shapes and sizes indicates that the front footages of the parcels also vary proportionally. This zone is assessed by front footage.

ZONE LS1: The street lighting and maintenance Zone 1 is a commercial zone of the City of West Sacramento in which all parcels benefited by the street lighting are also benefited by the landscaping. The zone is assessed on a front footage basis.

ZONE L1: This maintenance zone is located in the industrial region of the City. It is comprised of parcels of various dimensions and acreages. The method of assessment is parcel acreage.

ZONE L2: Zone L2 is a maintenance zone located in the residential regions of the City. Like Zone S1, the parcels are of uniform size and shape and are best assessed on a Per Parcel basis.

ZONE LSP2: This zone is located in the Washington Neighborhood/Raley's Landing area. This area receives street lighting and maintenance services.

The method of assessment is parcel acreage.

ASSESSMENT ROLL
An assessment roll is on file with the City of West Sacramento, California, and is a part of this report whether or not attached.

IMPROVEMENT PLANS
A set of plans showing lighting and maintenance improvements that are operated and maintained by the West Sacramento Landscaping and Lighting District #1 is on file with the City of West Sacramento, California, and is part of this report whether or not attached. 404
4 405

CITY COUNCIL AGENDA REPORT
MEETING DATE: June 7, 2023 ITEM # 17
SUBJECT:

CONSIDERTION OF RESOLUTION 23-48 INITIATING ANNUAL PROCEEDINGS UNDER THE STORM DRAIN MAINTENANCE ACT OF 1937 FOR STORM DRAIN MAINTENANCE DISTRICT NO. 1 (RALEY’S LANDING)
INITIATED OR REQUESTED BY: REPORT COORDINATED OR PREPARED BY:
[ ] Council [X] Staff
[ ] Other
Marc Rotteveel, Finance Analyst
Department of Finance
ATTACHMENT [X] Yes [ ] No [ ] Information [ ] Direction [X] Action

OBJECTIVE
The objective of this report is to provide sufficient information to Council to adopt Resolution 23-48 initiating annual proceedings under the Storm Drain Maintenance Act of 1937 for Storm Drain Maintenance District # 1, Raley’s Landing.

RECOMMENDED ACTION
Staff respectfully recommends that the City Council adopt Resolution 23-48 initiating annual proceedings and establishing the date of July 19, 2023 for a public hearing to be conducted under the Storm Drain Maintenance District Act of 1937 (the “1937 Act”) for Storm Drain Maintenance District No. 1 (Raley’s Landing).

BACKGROUND
State law provides for an annual proceeding prior to levying an ongoing assessment; and the recommended action is the first step in this process. Because staff is not proposing an increase in assessment, this action does not trigger voter approval under Proposition 218.

All property inside the City is provided storm drainage services by one of three Reclamation Districts, including Reclamation District 900 and the Lighthouse Marina and Raley’s Landing storm drain maintenance districts. Only one of these districts was formed under the 1937 Act, which includes approximately 85.43 acres within the “Raley's Landing” subarea of the Washington Neighborhood. The Raley’s Landing Storm Drain Maintenance District No. 1 (“the District”), has provided this service for many years via a special assessment district.

Storm drain facilities were first constructed in Raley’s Landing in 1964 to collect storm water runoff, convey it to a point adjacent to the Sacramento River levee, and pump it into the river. In 1989, the pumping facility was rebuilt as part of the Raley's Landing Assessment District and financed by the Raley’s Landing Limited Obligation Improvement Bonds (these bonds were completely repaid in December 2013). In order to pay for ongoing maintenance of the facilities, the City formed the District pursuant to Resolution 89-62. These assessments are continued on an annual basis in order to continue required maintenance. The fees for this service are set each year by the City Council and are collected by Yolo County on the regular property tax bill.

ANALYSIS
The District was formed prior to the enactment of Proposition 218 (“Prop 218”), an initiative approved by voters in 1996 that imposed requirements on the manner in which local governments could raise taxes. For instance, any proposed increases in the rate for the District would be subject to approval by the voters pursuant to Prop 218, hence the City has chosen not to increase the rate for 2023-2024, as has been the case in previous years.

The City of West Sacramento Storm Drainage Maintenance District No. 1 Assessment Report for 2023-2024 is included as an attachment to this report and referenced in Resolution 23-48. The report describes the method of assessment and rate schedule for the District for 2023-2024.

The expected assessment revenue for 2023-2024 is $12,311.

Since this District has only one zone of benefit, total operating costs need only be allocated to each benefiting property owner on a fair and equitable basis. The nexus basis for the assessment is the benefit per acre within the District boundaries, a rate that is currently set at $144.11 per acre.

The Report for 2023-2024, showing the nexus between benefit and property assessment, consists of two parts:
(i) a narrative and (ii) a rate schedule.
406
Resolution 23-48
June 7, 2023

The 1937 Act requires that the City Council hold a public hearing prior to the imposition of the assessment.

Resolution 23-48 preliminarily accepts the Report for 2023-2024 and sets a public hearing for Wednesday, July 19, 2023.

Environmental Considerations
Not applicable
Commission Recommendation
Not applicable
Strategic Plan Integration
The City has a Strategic Plan goal to achieve a Financially Sound City Government. Ongoing management of existing financing districts is a critical tool available to the Finance Department to achieve that goal. Proceeding with the recommended action is consistent with this goal.

Alternatives
As an alternative to the proposed action, the City Council may choose to continue this item and/or modify the date for the proposed public hearing. The deadline for submitting the levy to the County for inclusion on the 2023-24 tax roll is August 10, 2023, and holding a public hearing is a requirement for submitting the levy. If the Council chooses to continue the item or set a different date for the hearing, a special meeting may be necessary.

Coordination and Review
Not applicable

ATTACHMENTS

1. Resolution 23-48

2. Report for 2023-2024
407
Attachment 1
RESOLUTION 23-48

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF WEST SACRAMENTO

INITIATING ANNUAL PROCEEDINGS UNDER THE STORM DRAIN MAINTENANCE ACT OF 1937 FOR STORM DRAIN MAINTENANCE DISTRICT NO. 1 (RALEY’S LANDING) WHEREAS, the City Council has ordered the formation of the City of West Sacramento Storm Drain Maintenance District No. 1 under the Storm Drain Maintenance District Act of 1937 (West Water Code - Appendix §42-1 et seq.); and
WHEREAS, the City Council is required to annually confirm the diagram and assessment and file same with the County Auditor pursuant to the Act.

NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of West Sacramento as follows:

1. The City Council hereby appoints the Finance Manager as Engineer of Record for purposes of proceedings under the Act and directs and orders the Engineer to prepare and file the Report for Fiscal Year 2023-2024 in accordance with the Act.

2. The City Council hereby approves the Report for Fiscal Year 2023-2024 as filed by the Finance Manager.

3. A full and detailed description of the improvements, the boundaries of the assessment district and benefit zone, and the proposed assessments upon assessable lots and parcels of land within the district, is set forth in the Report. The Report recommends no change in assessments and is on file in the office of the Director of Finance, 1110 West Capitol Avenue, West Sacramento, California 95691, and is available for review by any interested member of the public during normal business hours.

4. On Wednesday, July 19, 2023 at 7:00 p.m., in the City Council Chambers, 1110 West Capitol Avenue, West Sacramento, California 95691, the City Council shall hold a public hearing on the levy of the proposed assessment.

5. The City Clerk is directed to give notice of the public hearing by publishing notice of the public hearing in accordance with normal City practice.

PASSED AND ADOPTED by the West Sacramento City Council this 7th day of June 2023, by the following vote:

AYES:

NOES:

ABSENT:
_________________________________
Martha Guerrero, Mayor
ATTEST:
_______________________________
Jennifer Cusmir, City Clerk
408
Attachment 2

CITY OF WEST SACRAMENTO

STORM DRAINAGE MAINTENANCE
DISTRICT #1

REPORT FOR
FISCAL YEAR 2023-2024
By

MARC ROTTEVEEL

FINANCE ANALYST
409
2 INTRODUCTION
Most property within the City limits is provided storm drainage services by one of the three Reclamation Districts. One exception is the approximately 85 acres in size storm drain maintenance area in the vicinity of what was formerly referred to as Raley's Landing, now encompassed within the Washington Neighborhood Area Plan. Since 1990, this area has been provided maintenance services via a special assessment district, Storm Drain Maintenance District No. 1 (“the District”). While additional storm drain maintenance districts were anticipated, no others were formed beyond this single district.

Facilities within the District were first constructed in 1964 as part of Reclamation District 811 (no longer in existence) to collect storm water runoff, convey it to a point adjacent to the Sacramento River levee and pump it into the river. In 1989, the pumping facility was rebuilt as part of the Raley's Landing Assessment District (also no longer in existence). These facilities are operated and maintained by the City of West Sacramento, using revenues collected under the procedures outlined below.

On May 10, 1989, the City Council adopted Resolution 89-62 which formed the District pursuant to the Storm Drain Maintenance District Act of 1937, or “the 1937 Act”. Each year, the City Council conducts a public hearing to hear objections to the placement of assessments on the next year’s tax roll. Following the public hearing, staff submits the tax levy to Yolo County and, and the County collects the assessment on the regular property tax bill.

METHOD OF ASSESSMENT
Parcel acreage assessment is best suited for storm drainage improvements. The improvements themselves are centrally located, but the benefits of the storm drain improvements are spread to all parcels included within the District. This benefit is outlined in the “Diagram of Assessment for Storm Drain Maintenance Area No. 1, a copy of which is on file with the City Clerk. The parcels themselves differ greatly in size and the Parcel acreage method of assessment address the fact that larger parcels will benefit more.

This takes into consideration the fact that the benefit is directly related to parcel size. The greater the parcel size, the more runoff occurs, the greater the assessment.

The parcel acreage can include only the portion of the parcel which falls within the boundaries of the watershed. A parcel which falls in more than one watershed will only be assessed for the acreage in this district.

Thus, the parcel acreage unit of benefit is based on parcel size. The total combined acreage of the parcels within a zone is divided by the cost of the assessment to determine a per-acre cost for the service. This amount is then multiplied by the number of acres or percentage of acre of each individual parcel to determine the amount to be assessed to each parcel. The larger the parcel, the larger the assessment will be.

LIST OF ATTACHMENTS
Assessment Diagram: An assessment diagram referenced to the Yolo County Assessor Parcel Maps is on file with the City of West Sacramento, California, and is part of this report, whether or not attached.
410
3 Improvement Plans: A set of plans showing storm drainage improvements of the City of West Sacramento Storm Drainage Maintenance District #1 is on file with the City of West Sacramento, California, and is part of this report, whether or not attached.

Assessment Roll: An assessment roll is on file with the City of West Sacramento and is part of this report. Parcels with twelve digits are Yolo County Assessor Parcels numbers, those with nine digits are State Board of Equalization numbers.

It should be noted that the District was formed without an annual Construction Cost Index (CCI) escalator, and therefore costs still reflect those included at the time of formation in 1989. 411