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HomeMy WebLinkAboutAudit Investment and Finance Committee - 10-27-2015MINUTES REGULAR MEETING OF THE PALM DESERT AUDIT, INVESTMENT & FINANCE COMMITTEE Tuesday, October 27, 2015 — 10:00 a.m. CALL TO ORDER Chairman Gibson called the meeting to order at 10:05 a.m. ROLL CALL Present: Russ Campbell, Community Member Paul Gibson, Committee Chair/Finance Director Abram Goldman, Community Member Robert Hargreaves, City Attorney Bob Leo, Community Member Stanley Sperling, Committee Member Susan Marie Weber, Mayor John Wohlmuth, City Manager Also Present: Jared Burns, Desert Willow Golf Resort Anthony Hernandez, Senior Financial Analyst Thomas Metz, Deputy City Treasurer Niamh Ortega, Recording Secretary Derek White, Desert Willow Golf Resort III. ORAL COMMUNICATIONS None. IV. APPROVAL OF MINUTES Absent: Robert Spiegel, Mayor Pro-Tempore A. MINUTES OF THE MEETING OF SEPTEMBER 22, 2015 MOTION was made by Member Leo to approve as presented the Minutes of the regular meeting of the Palm Desert Audit, Investment and Finance Committee held on September 22, 2015. Motion was seconded by Member Campbell and carried by an 8-0 vote, with Campbell, Gibson, Goldman, Hargreaves, Leo, Sperling, Weber and Wohlmuth voting AYE; Spiegel ABSENT. INVESTMENT & FINANCE COMMITTEE MINUTES OCTOBER 27, 2015 V. NEW BUSINESS A. CITY INVESTMENT SCHEDULE AND SUMMARY OF CASH REPORT FOR SEPTEMBER 2015 Member Jeffrey reported that the book value of the City portfolio for the period ended September 30, 2015 was approximately $198.4 million. Interest earnings were approximately $71,000. Yield -to -maturity was approximately 0.44%. MOTION was made by Member Campbell to recommend that the City Council receive and file the City Investment Schedule and Summary of Cash Report for September 2015. Motion was seconded by Member Sperling and carried by an 8-0 vote, with Campbell, Gibson, Goldman, Hargreaves, Leo, Sperling, Weber and Wohlmuth voting AYE; Spiegel ABSENT. B. LOCAL AGENCY INVESTMENT POOL ACCOUNT STATEMENTS FOR SEPTEMBER 2015 Chairman Gibson provided an overview of the various reports. MOTION was made by Member Campbell to receive and file the reports for Local Agency Investment Fund (LAIF), California Asset Management Program (CAMP), and Riverside County Investment Pool for September 2015. Motion was seconded by Member Weber and carried by an 8-0 vote, with Campbell, Gibson, Goldman, Hargreaves, Leo, Sperling, Weber and Wohlmuth voting AYE; Spiegel ABSENT. C. CITY FINANCIAL REPORT FOR SEPTEMBER 2015 Chairman Gibson provided an overview of the report and highlighted the activity for the month of September 2015. MOTION was made by Member Campbell to receive and file the City financial report for September 2015 as presented. Motion was seconded by Member Sperling and carried by an 8-0 vote, with Campbell, Gibson, Goldman, Hargreaves, Leo, Sperling, Weber and Wohlmuth voting AYE; Spiegel ABSENT. D. PARKVIEW PROFESSIONAL OFFICE BUILDINGS FINANCIAL REPORT FOR SEPTEMBER 2015 Mr. Hernandez provided an overview of the report, and informed the Committee that staff is currently working to find an architect to construct parapets that will mask the rooftop HVAC units. MOTION was made by Member Wohlmuth to receive and file the Parkview Professional Office Buildings financial report for September 2015 as presented. Motion was seconded by Member Leo and carried by an 8-0 vote, with Campbell, Gibson, Goldman, Hargreaves, Leo, Sperling, Weber and Wohlmuth voting AYE; Spiegel ABSENT. 2 INVESTMENT & FINANCE COMMITTEE MINUTES OCTOBER 27, 2015 E. PALM DESERT GOLF COURSE FACILITIES CORPORATION FINANCIAL REPORT FOR SEPTEMBER 2015 Mr. Burns provided a summary of the report, and Mr. White furthered that with temperatures about 10 degrees higher than normal for the last few weeks, September did not end as well as they had hoped. The drop in the Canadian exchange rate has also affected what is being spent. With regard to food and beverage costs, there is a high number of fixed salary components through the summer so that staff can be retained for high season. Higher costs and lower sales during the summer are balanced out during the busy season. For that reason, food and beverage revenue and expenditures should be considered from the overall annual perspective. When questioned on how the average food check is determined, Mr. White responded that bar sales are included, so this would bring down the average check when golfers may have one or two drinks after a round, and purchase a snack or lunch item at a separate time. Additionally, Desert Willow is not open for dinner, which would increase the average check substantially. Member Leo suggested that marketing of the dining room and golf may be an issue, adding that other courses should be studied to determine their successes and failures. Mr. White responded that this area is constantly under review to ensure that marketing dollars are being spent effectively. Marketing costs are extremely high, and with profit margins already slim, funds should only be expended when it will result in revenue in order to be effective. As an example, Mr. White offered that Indian Wells spends significantly more on advertising, yet Desert Willow receives more revenue in green fees, etc. Mr. White assured the committee that he and his team regularly review information on similar courses to ensure Desert Willow remains on target and in line with what other courses are doing to increase revenue and manage costs. MOTION was made by Member Leo to receive and file the Palm Desert Golf Course Facilities Corporation financial report for September 2015 as presented. Motion was seconded by Member Campbell and carried by an 8-0 vote, with Campbell, Gibson, Goldman, Hargreaves, Leo, Sperling, Weber and Wohlmuth voting AYE; Spiegel ABSENT. VI. CONTINUED BUSINESS None. VII. OLD BUSINESS A. PALM DESERT FINANCING AUTHORITY BOND ISSUANCE None. VIII. INFORMATIONAL ITEMS None. 3 INVESTMENT & FINANCE COMMITTEE MINUTES OCTOBER 27, 2015 IX. ADJOURNMENT MOTION was made by Member Leo to adjourn the meeting at 10:37 a.m. Motion was seconded by Member Campbell and carried by a carried by an 8-0 vote, with Campbell, Gibson, Goldman, Hargreaves, Leo, Sperling, Weber and Wohlmuth voting AYE; Spiegel ABSENT. Respectfully submitted, Niamh rtega, Rec ding Secretary 4