HomeMy WebLinkAbout4F - 4th Q. Investment Report Summary
STAFF AGENDA REPORT
AGENDA #:
PREPARED BY:
SUBJECT:
4F
RALPH TESCHNER, FINANCE DIRECTOR
CONSIDER APPROVAL OF 4TH QUARTER INVESTMENT
REPORT SUMMARY
JANUARY 21, 1997
DATE:
INTRODUCTION:
Staff has prepared this written narrative to serve as an informational
addendum to the quarterly investment report summary. Also
Attached to the quarterly investment report is a document entitled
"Investment Report Summary Narrative". It is intended to provide
supplementary information with respect to those allowable forms of
investment permitted by Minnesota Statute.
Additional objectives of the report narrative are to identify the
various funds established and describe the purpose those funds
serve. In most instances, the dollars are either reserved and
restricted for specific expenditures as indicated or sufficient fund
lances are necessary to provide adequate operational cash flows
,as in the cases of the General Fund and Sewer and Water Fund. If
/ councilmembers have questions please be sure to let me know
before or at the meeting.
Attachmen
16200 ~e Creek Ave. S.E., Prior Lake, Minnesota 55372-1714 / Ph. (612) 447-4230 / Fax (612) 447-4245
AN EQUAL OPPORTUNITY EMPLOYER
INVESTMENT REPORT SUMMARY
December 31 1996
Reference
Number
Investment
Cost
Interest Purchase
Rate Date
Maturity
Date
500754-00 Southwest State - Windom, MN 81,820.50 7.40% 04/13/95 04/13/98
500754-00 1 st National Bank - Elk River, MN 81,820.50 7.40% 04/13/95 04/13/98
500754-00 Bank & Trust, Puerto Rico 79,147.80 6.21% 12/18/95 03/15/00
500754-00 1st National Bank, OK 79,147.80 6.21% 12/18/95 03/15/00
500754-00 New South Federal Savings, CA 79,147.80 6.21% 12/18/95 03/15/00
500754-00 River Bank America, NY 79,147.80 6.21% 12/18/95 03/15/00
500754-00 Standard Federal Bank, MI 79,147.80 6.21% 12/18/95 03/15/00
Juran & Moody.Jnc.:
50912553 Commercial Paper 198,738.00 5.15% 12/31/96 02/14/97
50912553 U.S. Treasury Notes 900,030.00 5.51% 06/07/95 05/15/97
50912553 U.S. Treasury Notes 475,370.00 5.51% 06/07/96 05/15/97
50912553 U.S. Treasury Notes 840,585.00 4.69% 02/15/94 11/15/97
50912553 U.S. Treasury Notes 848,633.00 5.91% 07/21/95 05/15/98
50912553 U.S. Treasury Notes 394,255.00 5.07% 02/15/94 11/15/98
50912553 U.S. Treasury Notes 450,053.00 5.70% 12/31/96 11/15/98
50912553 U.S. Treasury Notes 424,250.00 6.07% 08/16/96 05/17/99
50912553 FHLMC govt. agency 503,940.00 6.62% 06/07/96 OS/21/00
50912553 FNMA govt. agency 503,676.00 6.98% 06/07/96 05/16/01
50912553 FHLMC govt. agency 500,000.00 6.12% 01/19/96 01/21/03
50912553 FNMA govt. agency 487,372.00 6.66% 12/09/96 11/12/03
League 4M Fund:
MN-01-145-1 Liquid Asset Fund 2,000,000.00 5.19% 12/06/96 --/--/96
Prior Lake State Bank:
# 10102 Certificate 500,000.00 5.35% 12/05/95 11/14/97
Prudential Securities:" ..
008-950601-33 Certificate 96,000.00 6.00% 11/20/96 11/20/98
008-950601-33 Certificate 96,000.00 7.00% 07/10/96 0711 0/01
008-950601-33 Certificate 96,000.00 6.00% 11/29/95 11/29/01
Smith Barney:
# 12089 Certificate 90,000.00 7.00% 03/23/92 03/23/97
# 12089 Certificate 90,000.00 6.45% 04/13/95 04/13/98
# 12089 FHLB govt. agency 170,521.00 7.03% OS/20/94 03/22/99
# 19089 FNMA govt. agency 95,461.00 7.17% 06/22/94 03/07/01
# 19089 TV A govt. agency 517,188.00 6.19% 01/04/96 08/01/02
# 19089 FNMA govt. agency 249,600.00 6.30% 12/06/95 02103/04
# 19089 FNMA govt. agency 498,281.00 6.33% 12/13/95 02/03/04
# 19089 FNMA govt. agency 256,525.00 6.34% 12/06/95 11/10/05
Investment Portfolio Total $ 11,841,858.00 5.83% (weighted average)
INVEST.XLS
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2:55 PM1/13/97
INVESTMENT REPORT SUMMARY NARRATIVE
The attached Investment Report identifies the various types of investments and those brokerslbanks the
City of Prior Lake uses for investment purposes. At the end of the report summary is the grand total of all
city monies currently invested and the weighted average return of the investment portfolio.
Investments for local governments are restricted to only those permitted by by Minnesota Statutes. They
are identified as follows:
1. U.S. Treasury Bills and Notes which are direct obligations of the federal government.
2. U.S. Government Securities which are guaranteed or insured by the federal government i.e.,
FHLB, FNMA, FHLMC, agencies or authorities such as TVA.
3. State and Local Government bonds that are rated "A" or better.
4. Bankers' Acceptances of a United States Bank
5. Commercial Paper that is rated "AAA" and matures in 270 days or less.
6. Repurchase Agreements with banks having capitalization exceeding $10,000,000.
Also allowable, but of higher risks, are guaranteed investment contracts (GIC's) and mortgaged-backed
securities (CMO's) which because of their sophisticated nature and inherent risk, Prior Lake does not
participate in.
The City's investment portfolio amount is a pool of city funds identified on the Monthly Treasurer's
Report which is comprised of 14 funds that have been established by the City as allowable under state
statute. A short description of these funds is outlined below and for the most part are dedicated for
specific purposes.
General Fund - The General Fund represents the necessary resources to support general operating
budget expenditures of the City. The year-end fund balance represents dollars that have
accumulated over a period of time as a result of cumulative budgetary revenue surpluses and
expenditure underruns. The City Council has designated a portion of this amount, equal to 30%
of the current operating budget, for working capital to finance city operations.
Sewer & Water Fund - The Sewer and Water Fund accounts for the collection of sewer and water
billing utility revenue. This enterprise fund balance is allocated for the operational costs of the
Water/Sewer departments and normally reserved for large capital municipal system expenses.
Storm Water Fund - The Storm Water Fund is funded by the $3.75 storm water charge on the
water bills and is dedicated to finance water quality improvements including departmental
administration, storm water maintenance operations and improvement projects such as water
quality ponds.
Capital Park Fund - Capital Park funds are dedicated funds generated by the 10% park dedication
fee as a result of new development and by park support fees on new construction building permits
for the purpose of developing the City's neighborhood park and trail system. These dollars are
programmed throughout the course of the city's capital improvement plan.
Severance Compensation Fund - This fund was established to partially fund the City's
compensated absence liability which is associated with the accrued vacation and sick leave of
employees upon employment termination. The State Auditor's Office has recommended that local
governments set aside a certain percentage on the basis of foreseeable turnover.
EDC Loan Fund - This fund was recently created to account for the proceeds of an economic
development grant that was received from the State of Minnesota to provide seed money for a
revolving loan account. The purpose is to provide economic incentive for new business
expansion within the community.
Tax Increment Fund - The Tax increment Fund represents an accumulation of funds such as bond
proceeds, TIP district property taxes (after debt service) and project administration fees charged
to companies requesting project writedowns in the form of tax increment financing for new
and/or redevelopment.
Equipment Fund - Equipment certificate bond proceeds are deposited in this fund as the principal
source of financing large equipment acquisitions. A general fund transfer was also authorized to
provide supplemental financing. The long term effect of contributing occasional general fund
contributions is to mitigate any property tax increase of future equipment certificates.
Buildinfi Fund - The funds within the Building Fund are bond proceeds from the issuance of
water revenue bonds necessary for the construction of the new maintenance facility. The CFAC
(capital facility) charge of $7.50 on each utility bill is reserved to pay the bond principal and
interest installments.
Construction Fund - Construction Fund dollars represent unexpended bond proceeds which are
reserved to pay for improvement projects that have been approved by the City Council on an
annual basis. For the most part these monies are necessary to complete outstanding construction
contracts and related professional and engineering services.
Trunk Reserve Fund - The Trunk Reserve Fund consists of dedicated funds generated from utility
connection permits and acreage fees assessed at time of sewer and water installation for the
purpose of trunk oversizing costs and central municipal system improvements i.e., wells, lift
stations, force mains etc. These dollars are programmed throughout the course of the city's capital
improvement plan.
Collector Street Fund - The Collector Street Fund consists of dedicated revenue generated by fees
associated with new development and new construction building permits for the purpose of
funding pedestrian related improvements i.e., bikeways, sidewalks, trail systems plus right of way
acquisition along collector streets.
Debt Service Fund - The Debt Service Fund represents prepayments of special assessments,
property tax collections and special levies needed to amortize the outstanding bonded
indebtedness of the City. This fund balance is 100% reserved for the payment of bond principal
and interest.
Afiency Fund - The Agency Fund accounts for the $1500 residential building permit deposit that
is refunded to the building contractor upon final inspection. This provides the City the required
financial assurance that the property site will be adequately cleaned up and debris free before an
occupancy permit is granted.
Because city funds are pooled for investment purposes, interest is allocated to each fund on a quarterly
basis, and is based upon each individual fund's proportionate share of the total. Overall the total
investment pool does not represent excess reserves but rather available financial resources. In most
instances these funds were establish and restricted for specific and designated purposes by either
Minnesota Statutes or City Code to accomplish the goals and objectives of the City of Prior Lake.
IR.WRT