09. Budget report Jan. '08ADMINISTRATIVE SERVICES DEPARTMENT
CUPERTINO
CITY HALL
10300 TORRE AVENUE • CUPERTINO, CA 950143255
(408) 777-3220 • FAX {408) 777-3109
SUMMARY
Agenda Item No. -r
SUBJECT AND ISSUE
Meeting Date: March 4, 2008
Accept the Treasurer's Investment and Budget Report for January 2008, including a status
report on General Fund Revenue and Expenditures.
BACKGROUND
INVESTMENTS
The market value of the City's portfolio totaled $62.3 million at January 31, 2008, with a
cost of $62 million. The difference, an unrealized paper gain of $0.3 million, emerged
during the month due to the drop in the economy's interest rates. That fall drove up the
market value of fixed interest securities in the portfolio. The decline in interest rates,
however, sent the portfolio's yield down to 3.92% in January, compared to 4.13% the
previous month and 4.67% a year ago. The Local Agency Investment Fund (LATE) yielded
4.62% for January, down from 4.80% for the previous month and down from 5.16% a year
ago.
Two and a half million dollars of Federal agency securities either matured or were called
during the month. The City's cash & investment balance rose $5.3 million during the
month due to property taxes. The new monies and the matured or called securities were
mostly invested in new Federal Farm Credit agency securities and U.S. Treasuries.
Investments are in full compliance with City investment policy and/or State law, and are
tiered to provide sufficient cash flows to pay City obligations over the next six months.
GENERAL FUND REVENUES AND EXPENDITURES
Year-to-date revenues through January 31, 2008 are up 2% over a comparable period from
last year. Growth in sales taxes, hotel taxes, and interest earnings are offset by declines in
development-related fees and taxes. The current budget, including last month's adopted
amendments, projects revenues to end up about 1% over last year's results.
Operating expenditures through January are up 14% over last year, including the recreation
enterprises moved into the General Fund this year. The current budget, including last
month's amendments, calls fora 20% increase over last year's actual results. Current
projections call for $700,000 in budget savings by the end of the year.
9-1
Treasurer's Investment and Budget Report
March 4, 2008
Page 2 of 2
RECOMMENDATION
Accept the Treasurer's Investment and Budget Report for January 2008.
Submitted by:
avid Woo
Deputy Treasurer
A oved for submission:
David W. Knapp
City Manager
Reviewed by:
~.
Carol A. Atwood
City Treasurer
Attachments:
1. Investment Portfolio
2. Rate of Return Comparison and Investments by Type
3. Compliance with Investment Policy
4. General Fund Budget Report
5. Revenue and Expense Trend Charts
s-2
City of Cupertino
January 3X, 2008
---U$SCRI o Matwi --
SECURITIES MATURED/CALLED ~~~
04/23/04
A 01/23/08 FHLB callable 3.15% 3.44% 1,500,000 1,500,000 1,500,000 0
04/21/06 04/07/11 FNMAcallab]e 5.75% 5.81% 750,000 750,000 750,000 0
04/29/04 10/29/08 Fl-1LB callable, step coupon 4.00% 3.64% 300,000 300,000. 300,000 0
_ SECURTI'1ES PURCHASED
01/14/08 04/14/09 FFCB callable _~ 4.22% 4.22% 1,000,000 1,000,000 1,002,910 2,910
01/17/08 01/17/12 FFCB callable 4.65% 4.65% 1,00(1,000 1,000,000 1,003,840 3,840
0122/08
08/03/09
FFCB
5.25%
2.55%
1,039,543
1,000,000
1,038,440 _
(1,103)
01/28/08 06/30/08 US Treasury Note 5.13% 2.25% 1,011,797 1,000,000 1,012,340 543
0128/08 l0/01/08 FFCB discount note 2.68% 2.77% 981,836 1,000,000 983,500 1,664
01/30/08 09/12/08 FFCB 4.50% 2.70% 1,010,862 1,000,000 1,010,630 (232)
CITY PORTFOLIO
CASH _
01/31/08 Wells Fargo -Workers Comp Checking 13,269 13,269 13,269 0
01/31/08 Wells Fargo -Regular Checking _
408,314 408,314 408,314 0
_ 421,583 421,583 421,583 »~ 0
LAIF _
~~ 01/31/08 1.AIF -State Pool 4.62% 4.62% 15,086,207 15,086,207 15,086,207 0
CERTIFICATES OP DEPOSIT
02/03/06 02/04/08 PrimeSouth Bank 4.65% 4.65% 97,000 97,000 97,010 10
02/10/06 02!11/08 Florida Community Bank 4.75% 4.75% 99,000 99,000 94,035 35
03/17/04 03/17/08 American Trust Fed Savings Bank 3.00% 3.00% 99,000 99,000 98,942 (58}
03/19/04 03/19/08 Planters First Cordele GA 3.05% 3.05% __ 98,000 98,000 97,945 (55)
03/24/04 03/24/08 Badger State Bank 3.00% 3.00% 99,000 99,000
_.__. 98,933 {67)
03!24/04 03/24/08 Wilmot State Bank _ 3.00% 3.00% 99,000 99,000 98,933 {67)
03/26/04 03/26/08 Private Bank & Trust 3.20% 3.20% 99,000 99,000 98,955 {45)
03/30/06 03/28/08 First Georgia Banking Company 5.05% 5.05% 99,000 99,000 99,248 ~ 248
04/07/04 04/07/08 Colo Taylor Bank, step coupon 3.01% 3.01% _
97,0 97,000 97,324 324
03!26/04 0926/08 South Coast Commnnity Bank _ 3.20% 3.20Yo 98,000 98,000 97,971 (29)
11/23/07 1120108 Arizona Bank&Trust 4.88% 4.88% 10,108 10,108 10,108 0
1123/07 1120/08 Banktrust 4.88% 4.88% 94,000 94,000 94,000 0
1123/07 1120/08 Cardinal State Bank 4.88% 4.88% 94,000 94,000 94,0(10 0
1123/07 1120/08 Colonial Bank NA 4.88% 4.88% 94,000 94,000 94,000 0
1123/07 1120/OS Covenant Bank 4.88% 4.88% 94,000 94,000 94,000 0
l 123/07 1 120/08 Four Oaks Bank & Trvst Co 4.88% 4.88% 94,000 94,000 94,000 0
1123/07 1120/08 Johnson Bank 4.88% 4.88% 94,000 94,000 94,000 0
1123/07 11/20/08 Midwest Bank of Western Illinois _ 4.88% 4.88% 94,000 94,000 94,000 0
1123/07 1120/08 Solutions Bank 4.88% _
4.88% 48,892 48,892 48,892 0
1123/07 1120/08 The Brand Banking Co 4.88% 4.88% _
94,000 ~~ 94,000 94,000 0
1123/07 1120/08 Vision Bank 4.88% 4.88% _
94,000 94,000 94,000 0
1123/07 1123/08 Pinnacle Bank 4.88% 4.88% 95,000 95,000 95,000 0
03/17/04 03/17/09 Peoples State Bank 3.40% 3.40% 99,000 99,000 98,351 (649)
0324/04 03/24/09 Washita State Bank _ 3.35% 3.35% 99,000 99,000 98,296 (704)
12/30/05 12/30/09 Meridian Bank 4.80°h 4.80% 99,000 _ _
99,000 100,605 1,605
1228/05 1228/10 NaNI Bank of New York City 4.90% 4.90% ___
97,000 97,000 98,689 1,689
2,378,000 2,378,Q00 2,380,237 2,237
9-3
City of Cupertino
January 31, 2008
o Maturi `~"~VA>;il
MONEY MARKET FUNDS
01/31/98 Wells Fargo Government 4.05% 4.05% 12,369,420 12,369,420 12,369,420 _
.r 12,369,420 12,369,420 12,369,420 0
AGENCY NOTES
02!25/04 9225/08 Fl-ILMC 3.13% 3.13% 1,000,000 1,000,000 1,000,140 140
~
1121/95 06/23/08 FFCB 5.79% 4.65% 1,004,184 1,000,000 I,Oi1,320 7,13_6_
01/30/08 99/12/08 FFCB 4.50% 2.70% 1,010,862 1,000,000 1,010,630 {232)
01!28/08 10!01/08 _
FFCB discount note 2.68% 2.77% 981,836
T 1,000,000 983,500 1,664
12/30/03 12/30/08 FHLMC callable, step coupon __._ 4.75% 3.90% 1,000,900 1,000,000 1,018,810 _ 18,810
~~
03/16/04 03/16/09 FNMA callable 4.01% 4.01% 1,600,000 1,600,000 _ 1,600,000 0
O1/l4/O8 04/14/09 FFCB callable 4.22% 4.22% 1,000,000 1,000,000 1,002,9[0 2,910
01/22/08 08/03/09 FFCB 5.25% 2.55% 1,039,543 1,000,000 1,038,440 (1,103)
11/30/O$ 04/07/10 FFCBcallabk 3.70% 5.029/0 974,395 1,000,000 1,000,3 t0 25,9I5
1121/95 07/12/10 FHLMC 4.13% 4.73% 986,811 1,000,000 1,030,310 43,499
11/19/07 l l/19/10 FFCB callable 4.65% 4.63% 1,000,000 1,000,009 1,013,750 13,750
12/15/05 12/15/]0 FHLMCcallable 5.04% 5.04% 1,000,000 1,000,000 1,018,150 18,150
_
01/17/08 01/17/12 FFCB callable 4.65% 4.65% 1,000,000 1,000,000 1,003,840 3,840
y
13,597,630 13,600,000 13,732,110 134,480
US TREASURY SECURITD?S ~ _
1220/07 04!30/08 US Treasury Note 4.88% 3.01% 1,004,474 1,000,000 1,006,880 2,406
12/10/07 05/15/08 US Treasury Note 2.63°h 3.17% 998,432 1,000,000 1,001,720 3,288
12!07/07 05/15/08 US Treasury Note 2.63°~ 3.25% 998,257 1,000,000 1,001,720 3,463
01/28/08 06/30/08 US Treasury Note 5.13% 2.25% 1,011,797 1,000,000 1,012,340 54:
12/10/07 07/31/08 U5 Treasury Note ~ 5.00'/0 3.27% 2,016,771 2,000,000 2,028,280 11,509
12/07/07 08/15/08 US Treasury Note 4.13% 3.35% 1,004,031 1,000,000 1,010,390 6,359
12/10/07 08/31/08 US Treasury Note 4.88% 3.34% 2,017,331 2,000,000 _ 2,030,160 12,829
12/07/07 09/30/08 US Treasury Note 4.63% 3.27% 1,008,664 1,000,000 1,015,780 7,116
12!10/07 09/30/08 US Treasury Note 4.63% 3.29% 1,008,623 1,000,000 1,018,780 7,157
12/07/07 10/31/08 US TreasuryNok 4.88% 3.27% 1,911,581 1,000,000 1,919,770 8,189
12/10/07 10/31/08 US Treasury Note 4.88% 3.25% 1,911,819 1,000,000 1,019,770 _ 7,951
~
12/07/07 11/15/08 US Treasury Note 4.38% 3.31% 1,908,139 1,000,000 1,016,640 8,501
12/19/97 11/15/08 US Treasury Note 4.38% ___ 3.27% 1,008,475 1,000,(}00 1,016,640 8,165
12/10/07 12/31/08 US Treasury Noie 4.75% 3.18% 2,027,862 2,000,000 2,046,100 18,238
12/20/07 01/31/09 US Treasury Note 4.88°/n 3.06°10 1,017,661 1,000,000 1,026,880 9,219
18,153,919 18,000,000 18,268,850 l ] 4,931
Total Mana ed Portfolio 62 006 759 61 55 10 62 58 407 251 648
Average Yield 3.92% _
Average Length to Matarity (ie years O,SS
TRUST PORTFOLIO KESTER TRUST)
CASH
01!31/08 Wells Institutional Money Mkt Acct 3.64% 3.64% 47,095 47,095 47,095 0
Total Trnst Portfolio 47 095 47 095 47 095 0
1301VD RESERVE PORTFOLIO
Bond Reserve Acct Ambac Assurance Security Bond 1 1 1
Bond Payment Acct µ Wells Treasury Plus Money Mkt 2.94% 2.94% 1,170 1,170 1,170 0
Total Bood Reserve Portfoli 1 ]70 1170 l 170 0
9-4
Rate of Return Comparison
5.50%
5.00%
4.50%
4.00%
3.50%
3.00 /Y i ~- 1 ~ ~ ~1 ~ f 1 I -T r
~1 X01 ~~ ~~ ~1 ~~~ X01 ~~01 ~1 ~,~~ 1 ~
~. ~. ~,~°
~~
~y
~o
~~
-~lAIF
~-Cupertino
9-5
COMPLIANCE WITH INVESTMENT POLICY
City of Cupertino _
Janua 31, 2008
Category _ Standard __ __ __ Comment
(,Treasury Issues No limit Complies
US Agencies No limit Complies
'Medium Term Corporate Bonds 30% with A rating Complies
LAIF $40 million Complies
Money Market Funds 20% Complies
Maximum Maturities Up to 5 years Complies
Per Issuer Max
Bankers Acceptances 10% (except for Treasuries and US Agencies)
180 days & 40% Complies
Complies
Commercial Paper
Negotiable Certificates of Deposit
Repurchase Agreements
Reverse Repurchase agreements 270 days & 25%
30%
365 days
Prohibited Complies
Complies
Complies
Complies
9-6
City of Cu ertino
General Fund Bud et Re ort
Janua 31,2008
Bud et Actual
Prior Year Amended
2006/07 2007108 1/31/2007 1l31/Z008 Anal sis of Trends
Taxes'
Sales Tax 11,575,000 14,190,000 6,152,778 7,494,315 Stron electronic a ui .sector & ma-or new rovider
Pro a Tax 6,290,000 6,710,000 3,743,032 3,770,297
Transient Occu anc 2,363,000 2,660,000 1,299,977 1,438,964 Local business demand
Utili Tax 2,392,000 3,240,040 1,470,660 1 520 364
Franchise Fees 2,500,000 2,580,000 803,265 752,993
Other Taxes 2,308 000 1,400,000 1,535,351 878,079 AMC & Whole Foods construction tax last ear
Licenses and Permits 3,050,000 3,030,000 1,739,511 1,622,217 Buildin rmits down
Use of Mone & Pro a 1,380,000 2,100,000 692,375 890,476 Stron cash osition
Inter overnmental 4,706,114 4,505,071 2,522,957 2,412,091 SB 90 claims down; Lastyr's VLF included corrections
Charges for Services 1,482,000 1,150,000 929,175 578,406 Residential development down
Fines & Forfeitures 680,000 800,000 284,417 300,236
Other Revenue 140,000 116 00 54,010 50,046
Sale of Pro 1,600,000,
Total Revenue U 2%
O eratin Ex enditures: '
Administrative 1,362,195 1,514,095 756,103 810,490 U 7%, but forecasted to end u below bud et
Law Enforcement 7,177,378 . 7,871,52b 4,094,550 4,491,063 Corre onds with bud et increase
Communi Service 917,644 1,285,848 628,724 639,605
Administrative Service 4,978,400 4,545,81 I 2,334,831 2,408,038
Recreation Service 2 428,298 3,936,359 1,044,342 2,030,773; BBF and Senior Center Ente rises this ear
Communi Develo ment ~ 3,885,441 3,897,479 1,772,217 1,947,969 Corres onds with bud et increase
Public Works 9,845,280 11,150 340 5,229,520 5 805 450 U 11 %, but forecasted to end u below bud et
Total Ex nditures U 14%, but forecasted to end u below bud et
Transfers In 1,459,974 1,030,000 291,662 644,581 RDA ayback; CIP closures
Transfers Out -7 026,296 -20,648,000 -9 299 415 -14,128 OOQI New CIP
Net Gain/ oss
Sales Tax Projections vs. Actua!
~, $10,000
o $8, 000
r
w
$6, 000
0
0
m $4,aoo
$2,000
8107 9107 10107 11107 12/07 1/08 w/budget
changes
Month
$0
--•-Projected, per current budget
-E~Actual ~
~~
.~
_. --
~-- -~
Property Tax Projections vs. Actual
~, $4,500
$4,000
r $3,500
m $3,000
r
o $2,500
0
$2,000
} $1,500
$1,000
$500
$0
8/07 9107 10/07 11 /07 12147
Month
--~-Projected, per current budget
--~~Actual
1148 w/budget
changes
9-8
Transient Occupancy Tax Projected vs. Actual
1,600
b
3
0
L
H
1,200
d
R
800
:.
R
m
}
400
0
-~-Projected, per current budget
-~-~---Achtai /
1 r r
. ~ ~
i
i
8/07 9107 10/07 11107
Month
12107 1/OS w/budget
changes
Licenses ~ Permits Projected vs. Actual
~, 2,oao
-~
c
0
H ~~..
y
1,ooa
..
m
}
---~--Projected, per current budget
--f-Actual ~ ~-- -~
'+ ~
r ~ r
~. ~
~ -
0
8107 9107 10107 11 /07
Month
12/07 1108 w/budget
changes
9-9
Charges for Services Projected vs. Actual
~, 2, 000
G
3
O
w L
~-
m
a+
16
1,000
d
0
--•--Pro}ected, per current budget
---~--Actual
r ~
r
~~
r 1r
r
8107 9107 10!07 11/07 12107
ao~
General Fund Expenditures Projected vs. Actual
~ 25,000
c
H
c
20,000
t
F-
15,aoo
0
0
1o,oao
m
s,ooo
0
Month
1108 wlbudget
-changes
9-10
8107 9107 10/07 11107 91IUI ~~~uuwwuuyC~
changes