101-Staff Report.pdf
ADMINISTRATIVE SERVICES DEPARTMENT
CITY HALL
1010300 TORRE AVENUE • CUPERTINO, CA 95014-3255
TELEPHONE: (408) 777-3220www.cupertino.org
CITY COUNCILSTAFF REPORT
Meeting:May 3, 2011
Subject
Treasurer’s Investment and Budget Report for quarter ending March 2011
Recommended Action
Accept the report
Discussion
Investments
The market and book value of the City’s portfolio both totaled $48.2million at March31, 2011.
The portfolio’s Marchyield of 0.32% was upfrom the December2010 yield of 0.28%but down
from a year ago rateof 0.44%due to the decision to take the portfolio to a safe and liquid mix of
investments given the risk and volatility of the market. The LAIF benchmark was at 0.50% for
March,upfrom0.46% in Decemberbut down from0.55% a year ago, reflective of their move to
a higher percentage of investments backed by the full faith and credit of the federal government.
The portfoliodecreasedfrom the previous quarterby $3million due to housing and retiree health
trust contributions, and energy conservation project payments.Maturing Treasuriestotaling
$17.5million werere-invested intonew Treasuries.
Investments are in full compliance with the City investment policy and State lawand are tiered
to provide sufficient cash flows to pay City obligations over the next six months. Market values
on individual securities in the investment portfolio are provided by Wells Fargo Bank
Institutional Trust Services using valuations from Interactive Data Pricing and Reference Data,
Inc.
The retiree health trust market value grew from $7.4 million to $8.4 million during the quarter,
due to investment gains and a $700,000 contribution from the City. The portfolio of equity, fixed
income and money market mutual funds returned 3.1% for the quarter and 10% since inception
nine months ago. Short-term volatility of market value is anticipated, with positive returns
expected in the long-run to fund future retiree medical obligations.
General Fund Budget Report
Current year revenues through March are up 22% over the prior year, exceedingprojections of
14%.Sales taxes, transient occupancy taxes, and charges for services are showing particular
strength.
Corresponding expenditures through March are2% over last year, which is on track with last
year results and this year’s projections, with budget savings anticipated by year-end.
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Prepared by:DavidWoo, Deputy Treasurer
Reviewedby:Carol A. Atwood, CityTreasurer
Approved for Submission by:David W. Knapp, City Manager
Attachments:Investment Portfolio
Retiree HealthTrust Report
Investments by Type,Rate of Return,and Compliance Charts
General Fund Budget Report
Expenditure and Revenue Charts