TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
FROM: Javier Carcamo, Finance Director
PREPARED BY: Geovanny Calvopina, Financial Analyst
SUBJECT: Monthly Investment Transaction Report for September 2023
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RECOMMENDATION
recommendation
Receive and file the Monthly Investment Transaction Report for September 2023.
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PRIOR ACTION/VOTE
No prior action.
CITY COUNCIL GOAL
Maintain a high performing organization that values fiscal sustainability, transparency, accountability and organizational efficiency.
BACKGROUND
This report is filed with the City Council in compliance with Government Code Section 53607, which states that a monthly report of transactions related to the purchase, sale, or exchange of securities is made monthly to the legislative body. The City of Murrieta (City) has both long-term and short-term investments. The City’s managed investment portfolio is for longer-term investments, managed through Chandler Asset Management. The Local Agency Investment Fund (LAIF), managed by the California State Treasurer, is used for short-term investments and functions more like a savings account to facilitate cash flow.
This report includes funds under management with Chandler Asset Management, funds deposited with LAIF, and earnings from the Wells Fargo Cash Sweep Program. Bond funds held by the City’s Trustee are not included in this report but are on file and available upon request.
The transactions in the long-term investment portfolio for September 2023 include dispositions of $23,168,733.98 in security purchases and money market sales, which also includes a withdrawal for bank fees of $354.00. In addition, a deposit of $20,000,000.00 was made in the investment portfolio account from our short-term investment account. In order to maximize interest-earning potential, the transferred funds will be invested as part of a two-plan strategy focusing on liquidity and limited maturity to maintain cash flow. Subsequently, these proceeds, together with the dispositions and monthly interest earnings, were reinvested in security and money market fund purchases totaling $43,377,229.31.
The California State Treasurer allocates and reinvests LAIF interest earnings on a quarterly basis. Quarterly interest earnings are reflected in the statement one month following the end of the quarter. This account's last interest earnings deposit was in July 2023, for the prior quarter. There are no LAIF transactions to report for the month of September.
As of September 30, 2023, the City’s Total Ending Book Value (or what the City actually paid for the investments) for both investment accounts (long and short-term accounts) is $169,884,363.49. All three accounts combined had an overall increase of $119,411.71 or .08% when compared to the prior month, which includes any deposits, dispositions, applicable interest earning, and less any realized gain/loss or monthly fees charged to the account.
The City is also earning monthly dividends in the General Checking account. The Wells Fargo “Cash Sweep Program” allows the City to earn a return on uninvested cash balances in our General Checking Account by automatically "sweeping" cash balances into a Sweep investment vehicle until such balances are otherwise needed to satisfy obligations arising in the account.
The total earnings from the Cash Sweep Program for the month of September were $336,254.99.
Included, as Attachments 1-3, are the investment portfolio accounts and LAIF regular monthly statements, which outline all transactions associated with the respective accounts. Additionally, Attachment 4 is a summary of daily transactions associated with the Wells Fargo Cash Sweep Program.
This report also includes a statement of compliance with state law and the City’s investment policy for the various investment categories.
FISCAL IMPACT
There is no fiscal impact associated with the recommended action. Interest earnings projections are included in the Fiscal Year 2023/24 Operating Budget.
ATTACHMENTS
1. Chandler Asset Management Monthly Account Statement for September 2023
2. Chandler Asset Management Monthly Account Statement for September 2023 (New)
3. Local Agency Investment Fund (LAIF) September 2023
4. Wells Fargo Cash Sweep Program September 2023 Statement