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HomeMy WebLinkAboutSEPTEMBER 2000 INVESTMENT AND FINANCE COMMITTEEMEETING AGENDA WORKSHEET Meeting Description Investment Committee Location North Winn Conference Room Time Convene /POO Adjournment i?:,t- Members Attending Yes No 1 Paul Gibson, Chairperson 2 Russ Campbell 3 Carlos Ortega, CM 4 Buford Crites �+ 5 �;;r,, y /� � /,c-ct. 6 Thomas Jeffrey 7 Murray Magloff 8 Bill Veazie 9 Gregg Lindquist 10 Dave Erwin 11 12 13 7/7/,G /A,9/etii it7 I .9i9ae f/;d2f/e1/ 2' Items To Be Discussed 1 2 3 4 5 6 7 8 9! Meeting Date 9 20A0 Time 11:00 p.m. Mailed Agenda 9,//4h/, GG Posted Agenda 9/T�/%r U L ftzt motel. 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' Mtn (1)" 'Mtn (2) MEETING'4OTESair.` f' a % £ 4 id't/%aJ,i 2 ' U.</>. 1n o,4, • ffr',.eo_ - fee • r 4.fi--/+ "nob Are."( r? >f z.e/cel ate__ uJ yu.�i Fa4 <tiltzepi. leg>,7**— /9X fir, v ytuv ,121.7 Add"2 � - �lr� yl.siis0 4/,/oea" LW( /7i`/2iMYP AateLc .62 iY%Ci/ a *) /dePtleA1 zir o ,fl//t /2 *aA •; p/ice / . z 4./Gt Off,1/2A, - l l f A,hy 1s Ail -tom 6'e, f " l�//! �o saw. 'u-if._- Ao ,b, e&-pc7a nr; s,;._ 6-e2-c..4.11— AC- A.zbe,(3/ new> '10a_,y_l- --fraise, 4 ACC. ti .-7-0 l' -• ,— > 4 1 n,Pit / Laer-('_ Spoke.. Mtn (1)°- At Tj� IF C % f i /— `J .ri. U72,4 s /.rlilyt �co / 7neatv f/r fl. • 'MEETING'NOTESt•:':, / . ft• ,/ �. Leese / :* d ,J ,,,cj' /Z_'0!- • Spoke:. `.Mtn (1) Mtn'(2) .' ` "' :: ` =.° "MEE71NG';NOTES Agenda INVESTMENT & FINANCE COMMITTEE Wednesday,'September 20, 2000 - 11:00 p.m. North Wing Conference Room I. CALL TO ORDER II. ROLL CALL III. APPROVAL OF MINUTES - July 19, 2000 Rec: Approve minutes of the regular meeting of July 19, 2000, as submitted Action: IV. ORAL COMMUNICATIONS A. Any person wishing to discuss any item not otherwise on the agenda may address the Investment & Finance Committee at this point by giving his or her name and address for the record. Remarks shall be limited to a maximum of five minutes unless additional time is authorized by the Chairman. B. This is the time and place for any person who wishes to comment on non -hearing agenda items. It should be noted that at the Investment & Finance Committee's discretion, these comments may be deferred until such time on the agenda, as the item is discussed. Remarks shall be limited to a maximum of five minutes unless additional time is authorized by the Chairman. V. OLD BUSINESS A. Status of Public and Private Partnerships Backaround Checks for Section 4 Rec: Report by Redevelopment Manager Dave Yrigoyen Action: B. Bond Issuance by Palm Desert Financina Authority Rec: Status Report on issuing new bonds presented by Dave Yrigoyen Action: AGENDA - INVESTMENT & FINANCE COMMITTEE September 20, 2000 Page 2 VI. NEW BUSINESS A. City and Redevelopment Agency Investment Schedule for July/August 2000 Rec: Review and submit to the next City Council agenda. Review the presentation on the investment graphs. Review the investment activity for July/August 2000. Review status of capital projects and cash -flow projections. Action: B. Review Short Term Investments Maturing in August / September 2000 Rec: Review investments in 1) collateralized deposits; 2) treasury bonds and notes; and, 3) agencies discount notes Action: C. State of California Local Aaencv Investment Fund Monthly_ Reports for June 2000 Rec: Informational item for the Committee to review. No action required D. Monthly Financial Report for City Council for Julv/Auaust 2000 Rec: Report and submit to City Council Action: E. Parkview Professional Office Buildings - Financial Reports for June/July/August 2000 Rec: Review and file report Action: F. Desert Willow Golf Resort Financial Information for June/July 2000 Rec: Review and file report Action: G. Palm Desert Recreation Facilities Corporation Income Analysis for June/July 2000 Rec: Review and file report Action: AGENDA - INVESTMENT & FINANCE COMMITTEE September 20, 2000 Page 3 H. Proposed Additions to Approved List - Commercial Paper Rec: Review and approve adding proposed issuers to Commercial Paper Action: IJ. Proposed Additions to Approved List - Medium Term Notes Rec: Review and approve adding proposed issuers to Medium Term Note Approved List Action: K. Investment Rankina of Citv of Palm Desert Rec: Informational item for the Committee to review. No action required L. New Broker -Dealer: Merrill Lynch Rec: Review and recommend to City Council for approval Merrill Lynch application to serve as a broker -dealer for the City of Palm Desert Action: M. Guaranteed Investment Contracts Rec: Review and move that guaranteed investment contracts should not be used for the investment bond proceeds Action: VII. REPORTS AND REMARKS A. Reports and Remarks by anv Committee Member B. Items to be placed on the next aaenda VIII. INFORMATIONAL ITEMS A. Assembly Bill 943 (SEE SECTION "N" OF AGENDA) AGENDA - INVESTMENT & FINANCE COMMITTEE September 20, 2000 Page 4 IX. NEXT MEETING - Wednesday, October 18, 2000, at 11:00 p.m. X. ADJOURNMENT I hereby certify under penalty of perjury under the laws of the State of California, that the foregoing agenda for the Palm Desert Investment and Finance Committee was posted on the City Hall bulletin board not less than 72 hours prior to the meeting. Dated this September 12, 2000. Def3ra radley, Recording Se, CALL TO ORDER ROLL CALL ORAL COMMUNICATIONS APPROVAL OF MINUTES INVESTMENT AND FINANCE COMMITTEE Minutes July 19, 2000 A regular meeting was called to order by Finance Director Paul Gibson on Wednesday, July 19, 2000, at 11:07 a.m. Present were the following members, constituting a quorum: Finance Director Paul Gibson, City Council Member Bob Spiegel, Acting City Manager Carlos Ortega, Investment Manager Thomas Jeffrey, Redevelopment Manager Dave Yrigoyen, Russ Campbell, Murray Magloff and Bill Veazie Absent were the following members: Mayor Buford Crites, Mayor Pro-Tem Jim Ferguson, City Attorney Dave Ervin Also, present were: Recording Secretary Debra Bradley Commendations were extended by Murray Magloff to Paul Gibson and finance staff for the Award of Financial Reporting Achievement to the City of Palm Desert by the Government Finance Officers Association (GFOA). Mr. Magloff inquired on a current newspaper article regarding City "leave/salary' pertaining to Mr. Diaz, to which City Council Member Bob Spiegel reiterated his clarifications replied to at previous meetings. Upon motion of Mr. Spiegel, seconded by Mr. Veazie, and by unanimous vote, the minutes of the June 21, 2000, meeting were approved as submitted. OLD BUSINESS A. Status of Public and Private Partnerships Backaround Checks for Section 4 There being no updates on background checks, discussion ensued to the next agenda item. Investment and Finance Committee Minutes of July 19, 2000 Page 2 B. Bond Issuance by Palm Desert Housina Authority Mr. Yrigoyen briefed that staff is still working on the figures related to the bond issuance in Project Area No. 2. NEW BUSINESS A. Citv and Redevelopment Agency Investment Schedule for June 2000 The City's Portfolio Summary was distributed and filed. Referring to the portfolio summary for the City of Palm Desert, the book value ending June 30, 2000, was $169.7 million, reflecting a gain of $5.3 million over the prior month. Mr. Jeffrey corrected the table pertaining to Fidelity Treasury Pool, noting it would now be the Federated Government Money Market Fund. As denoted in the Sector Allocation of the pie chart, currently there is 44% of the portfolio in money-market funds. LAIF continues to be ahead of the City due to active reinvestment. Referring to the portfolio summary for the Redevelopment Agency (RDA), Mr. Jeffrey reported the book value ending June 30, 2000, was approximately $150.4 million, reflecting an increase of $7.1 million over the prior month. This was due to debt service and capital projects. As with the City, LAIF continues to be ahead of the RDA. The City's Summary of Cash report was distributed and filed, with a recapitulation by Mr. Gibson. There was no Summary of Cash report ending June 30, 2000, for RDA. B. Review Short -Term Investments Maturing in July 2000 A Maturing Investments report was distributed and filed. Mr. Jeffrey briefed that there is $2 million in each portfolio of the City and RDA that will be maturing in July 2000. C. State of California Local Agency Investment Fund Monthly Reports for Mav 2000 Report was filed with no discussion. Investment and Finance Committee Minutes of July 19, 2000 Page 3 D. Monthly Financial Report for City Council for June 2000 The June 2000 financial report for the City was received and filed with discussion proceeding. Relating to revenues, Mr. Gibson reported that based on MRC's final figures, the accrued sales tax was $12.8 million for the fiscal year, versus the budgeted $10.8 million. Retail growth increased 15%; State as a whole did 11%. In regards to Transient Occupancy Tax (TOT), final figures will be a little over $7 million, versus the budgeted $6.3 million. The main contributors were the new hotels and the Marriott time shares. To conclude with expenditures, Mr. Gibson noted that there is one and one half months of Sheriffs bills that still needs to be added. The final figure for the General Fund will approximate to $33.5 million. Without all the accruals, the total income for the year approximates to $33.5. Mr. Gibson noted that the June 2000 financial report for the Redevelopment Agency was not available due to year-end activities. Mixed discussions followed. E. Parkview Professional Office Buildinas - Financial Reports for June 2000 It was highlighted by Mr. Gibson that the year-to-date actual net income is $427,000. After UCR and JMS Engineering occupies the two remaining spaces, the office building will be one -hundred percent occupied. It was noted that the tenant Mr. Hanover has signed the agreement related to the various options. F. Desert Willow Golf Resort Financial Information for June 2000 There being no report available due to year-end activities, discussion ensued to the next agenda item. G. Palm Desert Recreation Facilities Corporation Income Analysis for June 2000 There being no report available due to year-end activities, discussion ensued to the next agenda item. Investment and Finance Committee Minutes of July 19, 2000 Page 4 H. Prime Money Market Fund Reference was made to the letter received by Richards, Watson & Gershon, the City's bond counsel, regarding the investment of bond proceeds in money market fund, to which counsel verified that the City could invest in prime money market funds, as related to Government Code. Mr. Jeffrey described in length the investments related in the comparison report, "Exhibit A," detailing the most favorable choices offered by the Bank of New York are AIM, Goldman Sachs Financial Square, JP Morgan Institutional Service, and Federated Prime Obligations Fund. It is staffs recommendation that the bond proceeds be invested in AIM, in lieu of the current investment Fidelity Government Money Market Fund, for the purpose of improving portfolio profitability. Discussions proceeded with various inquiries related to restrictions on earnings. Several members inquired on each investment entity's profile. It was moved by Mr. Ortega, seconded by Mr. Cambell to approve staff's recommendation; Discussion followed on the pending motion due to abstentions by Council Member Spiegel and Mr. Veazie, as they were unacquainted with the investment entities. Mr. Jeffrey noted the Moody and S&P ratings and Mr. Gibson offered to provide the Committee with more profile information at another meeting. After further contemplation, Mr. Veazie changed his abstain to aye. Motion was carried by majority vote; Council Member Spiegel abstained. I. Auaust 16.2000. Meeting of the Investment & Finance Committee Following up from the last meeting, Mr. Gibson directed the Committee to take action on the recommendation to cancel the August 16, 2000, meeting and reconvene September 20, 2000. Investment and Finance Committee Minutes of July 19, 2000 REPORTS AND REMARKS INFORMATIONAL ITEMS NEXT MEETING ADJOURNMENT Page 5 It was moved by Mr. Campbell, seconded by Mr. Veazie and carried to cancel the August 16, 2000, meeting, unless matters call for a special meeting. None. A. Approved Corporate Securities Lists As a follow-up from the last Committee meeting, Mr. Gibson provided the Committee with the ratings currently being used. Mr. Jeffrey reiterated the Committee's determination to drop Xerox from the commercial paper list. B. McCallum Theatre Financial Report Referring to the Financial Report ending July 31, 1999, Mr. Ortega made notations to their assets and their unfavorable use of their endowment for operational expenses, with no monies being used to maintain the facility. The next regularly scheduled meeting will be held on Wednesday, September 20, 2000, at 11:00 a.m., in the North Wing Conference Room. There being no further business, the meeting was adjourned by Mr. Gibson at 11:55 p.m. Respectfully submitted, Debra Bradley, Recording Secrete` a Wm®ceDe1 &,dirywdocONVSTCOMnmavres07I9OO xrd 8 / co\ % Paul S. Gibson, City Treasurer (\\k0T<o 0 • (0!¢Za§/# In co }()(� aa /({|; `iE ID 0 0. ! }/ 2 3— \ o!|d D35agPO co 0 \ CD D3 CD co co \ / § CO 1 CD CD ;! -0«)w!k a (ƒ;kkaWOO 0 Total Cash and Investments Of 03 S uawtsenul stuawtsanul `=QM00 -§)))4o)OJ co Sp004305001 II m0-0a00ga;@!, L9'91.C'9SC'ELI is. LSL'b90'CL1. 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This reflected a net increase of approximately $3.4MM from prior month due principally to LAIF transfers and interest and sales tax receipts. There was an unrealized portfolio net gain (market value - book value) of approximately $91 M, based upon prevailing market interest rates. This was only a "paper" gain since there were nopremature securities sales. Significant changes in investment position are shown below: "United States Treasury - Coupon" The City buys interest -bearing U.S. Treasury notes with maturities of 2 - 10 years to invest assessment bond proceeds. Although unrated, considered "AAA". THIS ACCOUNT BALANCE DECREASED BY APPROXIMATELY $3M DUE TO AMORTIZATION OF PREMIUMS. "Federal Agency - Coupon". The City buys U.S. government agency and instrumentality notes with maturities of 2 - 10 years to invest assessment bond proceeds. Agency debt guaranteed by U.S. Treasury; instrumentality debt is not (guarantee, instead, believed to be U.S. Government's "moral obligation"). Although unrated, considered "AAA." THIS ACCOUNT BALANCE DECREASED BY APPROXIMATELY $2MM DUE TO A MATURING SECURITY. "Local Agency Investment Fund (LAIF)" The City temporarily invests proceeds of matured securities in $13MMM pool managed by State Treasurer's Office for 2,600 govemmental entities. LAIF has diversified portfolio (BAs, CP, Treasuries, agencies, corporates, repos, reverse repos, CDs) with weighted average maturity of 180 - 540 days. THIS ACCOUNT BALANCE DECREASED BY APPROXIMATELY $572M DUE TO A DRAW FOR ESCROW CLOSINGS. "Federal Agency - Callable". The City purchases federal agency securities that may be called prior to maturity, in order to obtain an additional premium for that risk, thereby increasing overall portfolio profitability. THIS ACCOUNT BALANCE BALANCE DID NOT CHANGE. "City Loan to RDA". The City has made long-term cash advances at LAIF interest rate to RDA for property purchases. Advances will be repaid in future years from tax increment revenue generated by associated redevelopment projects. THIS ACCOUNT BALANCE DID NOT CHANGE. "Federated Govt MMF Pool". The City invests assessment bond proceeds (construction, cost of issuance, and bond reservereserve monies) in "Fidelity Institutional Money Market Fund: Treasury Portfolio - Class I." This $3.9MMM fund investsin U.S. Treasury bills and notes, and repurchase agreements for those securities. Weighted average maturity is 60 days orless S&P credit quality rating of "AAAm"; Moody's of "Aaa". THIS ACCOUNT BALANCE INCREASED BY APPROXIMATELY $219M DUE TO MATURING SECURITIES. "United States Treasury - Discount". The City buys noninterest-bearing zero coupon securities ("STRIPS") with maturities of 6 months - 30 years, to invest assessment bond proceeds. Purchased at discount; face value paid at maturity (difference is yield). Although unrated, considered "AAA". THIS ACCOUNT BALANCE DID NOT CHANGE. "HighMark Sweep Accounts" The City sweeps excess checking balances into "HighMark 100% U.S. Treasury Money Market Fund". This $905MM fund invests only in U.S. Treasury bills, notes, and STRIPS (no repos or reverse repos). Weighted average maturity is 90 days or less (per SEC regs). Although unrated, underlying securities considered "AAA". THIS ACCOUNT BALANCE INCREASED BY APPROXIMATELY $5.8MM DUE PRINCIPALLY TO MATURING SECURITIES, LAIF TRANSFERS AND INTEREST, AND SALES TAX RECEIPTS. "State & Local Govt Series - Time". The City buys special noninterest-bearing U.S. Treasury certificates of indebtedness with maturities of 15 days - 1 year, to invest assessment bond proceeds (to comply with IRS yield & arbitrage rebate regs). Nonmarketable. Although unrated, considered "AAA". THIS ACCOUNT BALANCE DID NOT CHANGE. "Medium -Term Notes". The City buys interest -bearing corporate medium -term notes with maturities of five years or less, to invest revenues. THIS ACCOUNT BALANCE DECREASED BY APPROXIMATELY $9M DUE TO AMORTIZATION OF PREMIUMS. SB$ON wJal-wn,pary a n saunseail 'S'n CA A W N-. W N m m m o c Z 5�' O N op O 0 0 o CO 0== 0 0 m m �'m m a Q m m : 3 n 2 m w 2 CD o CO v Q C) Nam. N N d 0 f0 0 W H Z Z N O y d N N CO C O a, C O Z C l A A 0 V Ci Z t to Ci (D o �N N W W "'N a j m O N p 0 C) S A O N i O A e 0 -0 N co ° n�aa aoN ono °o el O 3 2 d n Cp O N 0 A CO d O O D n' n Z m a Er �' .°� N- o o. A{.. 0 x 00 o o rn ° n CD W 0 O o v00)) 0 d m O Ci n v 3 O O O , N O O 1 (7 n 0 o N 0 .... N O N o a ... 0 ' .. O O D a N.. 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Z Z W 9 T 0 p<<<< N A A p p 0 P i0 i0 O W CCI m o 0m1C O A 2 _m O p 'm m 0 0 in en 1Nf1OoSIO - Aa0SV3Ul Sfl N N N A W N O N 3WIl • 1AOO 1VOO1 8 311/1S 0 cn 0 g lue Wlsanal 8888 (0 CO CD Z Z 2 2 u mmm m m 0 0 0 0 y 0 (0 mm m m m m m O1 N 0 N m m m m m mA mA mA mA D D D D D D D D D efeiany Pue amigos 0000. g g g o a Aa13 a ++ a (0C'�NN rm3 550 'n CO m CO CO CO 0 S S m Co Co CO CO CO 0 0 0 J 0 N Co 8 N (W� W CO CFIES 0 (py J N -93 0 O A N N W L N W+ co 0 0 O (0 N O 0 0 A 0 0 0 0 0 0 W J 0 0 0 0 0 0 0 0 0 N. U CO 0 0 0 0 0 0 0 0 0 01 • N O O O O O O O CO V O 0 0 0 0 0 (PN4 no lo in C.4 O m 41 V 0 + CO 23 00� Co P co A O 0 99'Ek:'►99'L 0066591L91Z W 0 y U N CO J b 0 A N A m 1 A (y V N N CO 0 0 0 A A N N O V IW MJ 0 W 10 U LI A m A N 2.1 Li; Ca V 0 A N N 0 0 0 V U (If A N O O O O O V N O A U 0 0 0 0 0 0 pV N N (f+pp 0 Co 0W1 W U hi 0 (p A N {,J y 0 0 O Y N N 0 N A (O co Co Ca 0 - A A N N G1 W O+ (4 N O N N CI) --I V 0 0 A 0 W V U (O W V O J V 0 (O U CO V 0 0I N 0 W 0 W U 0 + O 0 V Nm 0 0 V U W N 0 0 0 a N 10 A A N (O 2 O O O O O W 0 0 0 0 V N V N Q enIBA leliepj enleA ewe 0 0 0 U A A A A A 2.‘n 0+ 01 O $ S A en N G m 6 O D U 0 0 N PO CO A 0 O a ttt ttttt tttt of (I 0 C� q OV 00i Cr. + O O V 0 N CO 0 0 W 0 y m 0 CO (O + V (D CO U W CO CO U 0 0 ^O' o m OO oam „ v°,r d c `1 3 1 m o c!C o.• 3 o 0 eT z 3 ♦/ N .( N U U U 0 U U 0 U U U U co O O O O O N 0 0 CO CO O O O N A A (/� U p C 0 O J 0 U 0 U U N V V A O A O S 8 O + N 0 0 J 0 0 0 0 0 0 0 0 CO 0 O O O 0 YW01 n a O O O O + O O 0 o8R mBNN 01 3 v o>op o SSS SS22S 000$ 08o m C V D+ p m 1 0+ W W A W O O O N 04 01 \ \ 4 0 $ % 0 • tn at tin ioo.0 «0 % 0/\V °s % \ v. - ma $ ®� ` ol o YIELD (%) A !T fly Ut O U1 c d m O m m O N RDA PORTFOLIO YIELD (MINUS SLGS) 9 0 >1 c Z 66-300 66- T 0 cm ; 8 cr Z TI N 't '? 62 g> o r 8 D ;I - 81 e5 $ MILLIONS : M O Tm K 0 T 2 C N C T r71 T W< O 7NC?7CmCgei-Im-IM mmm _0 0>ril<7. m �TOO°ymHW Z mb F m O D D O N C O C 0 0 O ma z2-oZ <c<z 0 3D1 m Or N - 0—o S8 1 S8 Oj 0,170nC$CO 2O8N TNT NM ; F CZO $a m OZ,NzCrN ,..0e om r• o 0 m mc. r0 0 8 m mr wmm mm4»64,»6N43m4w6, c c 80 ,a N O V N N AppN��NN V mN raAV99NoNi0 y+T pq+m88 ipNO D�0'0,(T„Am-iAV,NNf11 2 o$=8km88 p `°a NOIIVOO11V 1:10103S RDA PORTFOLIO BOOK VALUE (MINUS SLGS) 1 NHH N6N4dlf9f4f4 l96NW O M j D N �(1p1 C+ V lJ N J V a N N amw o+a mv�cN (n t0 ,) V V N $&N$ 8fl8S i1;88' s,6'a mv+Nv.v)0m0mmwm (pt NIO N = N A V N a A N N V .8JJ> p V �m g NV,lw,N, i NUN,>N pO 0 N N 0 O '" V O 9 0 PORTFOLIO (%) 0 AGEING OF PORTFOLIO MATURITIES (MINUS SLGS) Ca 0 _m c m ma 33 to -133 Cram rr-1c i ▪ V r Om C y 0 Z REDEVELOPMENT AGENCY INVESTMENT ACTIVITY REPORT JULY 2000 (EXECUTIVE SUMMARY I As of 7/31/00, total portfolio book value was approximately $152MM (with SLGS). This reflected a net increase of $1.4MM from prior month due principally to a City LAIF transfer. There was an unrealized portfolio net loss (market value - book value) of approximately $5M, based upon prevailing market interest rates. This was only a "paper" loss since there was no profit-taking. Significant changes in investment position, by security type, are discussed below: "State & Local Govt Series - Coupon." Palm Desert Financing Authority buys special interest -bearing U.S. Treasury notes with maturities of 2 - 10 years to invest proceeds of advance refundings held in escrow (to comply with IRS yield and arbitrage rebate restrictions). Although unrated, considered "MA". THIS ACCOUNT BALANCE DID NOT CHANGE. "Federated Govt MMF Pool " RDA invests tax-exempt bond proceeds (construction, cost of issuance, and reserve monies) inFidelity Institutional Money Market Fund: Treasury Portfolio - Class I." This $3.9MMM fund invests in U.S. Treasury billsand notes, and repurchase agreements for those securities. Weighted average maturity is 60 days or less. S&P creditquality rating of "AAAm"; Moody's of "Aaa." THIS ACCOUNT BALANCE INCREASED BY APPROXIMATELY $2.9MM DUE TO MATURING SECURITIES AND A CITY LAIF TRANSFER. "I ncal Agency Investment Fund (LAIF) " RDA invests City's loan in $13MMM pool managed by State Treasurer's Office for 2,600 governmental entities. LAIF has diversified portfolio (BAs, CP, Treasuries, agencies, corporates, repos, reverse repos, CDs) with weighted average maturity of 180 - 540 days. THIS ACCOUNT BALANCE INCREASED BY APPROXIMATELY $292M DUE TO QUARTERLY INTEREST INCOME. "United States Treasury - Coupon." RDA buys interest -bearing U.S. Treasury notes with maturities of 2 - 10 years to invest tax-exempt bond proceeds. Although unrated, considered "AAA". THIS ACCOUNT BALANCE DECREASED BY APPROXIMATELY $2M DUE TO AMORTIZATION OF PREMIUMS. "State & Local Govt Series - Time." Palm Desert Financing Authority buys special noninterest-bearing U.S. Treasury certificates of indebtedness with maturities of 15 days - 1 year to invest proceeds of advance refundings held in escrow (to comply with IRS yield and arbitrage rebate restrictions). Nonmarketable. Although unrated, considered "AAA." THIS ACCOUNT BALANCE DECREASED BY APPROXIMATELY $372M DUE TO A MATURING SECURITY. "United States Treasury - Discount " RDA buys noninterest-bearing zero coupon securities ("STRIPS") with maturities of 6 months - 30 years to invest tax-exempt bond proceeds (construction monies). Purchased at discount; face value paid at maturity (difference is yield). Although unrated, considered "AAA". THIS ACCOUNT BALANCE DID NOT CHANGE. "HighMark Sweep Accounts " RDA sweeps excess checking balances into "HighMark 100% U.S. Treasury Money Market Fund." This $905MM fund invests only in U.S. Treasury bills and notes (no repos or reverse repos). Weighted average maturity is 90 days or less (per SEC regs). Although unrated, underlying securities considered "AAA." THIS ACCOUNT BALANCE INCREASED BY APPROXIMATELY $125M DUE TO INTEREST INCOME. "Federal Agency - Coupon." RDA buys U.S. government agency and instrumentality notes with maturities of 2 - 10 years to invest advance refundings and tax-exempt construction funds. Agency debt guaranteed by U.S. Treasury; instrumentality debt is not (guarantee, instead, believed to be U.S. Government's "moral obligation"). Although unrated, considered "AAA." THIS ACCOUNT BALANCE DECREASED BY APPROXIMATELY $1.6MM DUE TO MATURING SECURITIES. "Federal Agency - Callable". The City purchases federal agency securities that may be called prior to maturity, in order to obtain an additional premium for that risk, thereby increasing overall portfolio profitability. THIS ACCOUNT BALANCE INCREASED BY APPROXIMATELY $2M DUE TO AMORTIZATION OF DISCOUNTS. "Medium -Term Notes" The City buys noninterest-bearing corporate medium -term notes with maturities of five years or less, to invest revenues. THIS ACCOUNT HAS NO CURRENT BALANCE. saaue,daaoy s,sieyueg sajoi/ WJal-wn!papy saiouef y moped saunseal 's'n W CO CO CI 0 co y D n� 3jgD TT 117 NNNN+O0 91 X (D _Zb N W 0(o 0000(0N W n d d0 N 'Kfi zzz W N�O(cO<Qa a n N A C 7 N A 1 z z== N N (D N O CO T. O N W H Z CU 0 0 N d N N CO C C o C O Z D C j A O - Z 0 0 N N„ (D N N 7 0 .Tl O N 'i ° p1 C = r O ON a y m 'y W 0-. O (T O C R _' ? N N W ' c , n 1 D e s- o 5' o m y o 0 0 0 0 (°� o O 3; ° CD (p o a m N n (oZ. co' v U r m 7 ° Oosi N , °. N ^ N D a. ° ° O 0_ ° ci Z n m 0 - g A 11 0 (^ _° 0 CD 0 N 0° o 0 3 i p ° v y 0 0 0 0 0 n A N 0 0 N 0 j .N. O y n T 0 0 C o. > 0 3 n N c< r- 0 Dv Z. 0 n m z i D t 7 C Ti O0 j Z m z NI7 0 0 0 A A 0O O O O (O AZI 00 0 oao oaoao 0 o m� o Zr O adA11NBWIS]ANI F,s6n 6 696949 6969696969 to 69 A D0 N V1 01 W co 01 0 21 00 (0 CO 0) N.) 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O th p. 4 0W (� fJ + CO W 0 a) r 0 :VA m QQA + O V 0 CA" 0 ' 1 O a 0 N O o K 0 0 0 0 o !O t+ W O O 0 m O W Y O 0 0 0 0 0 0 0 0 z C 5 (Q 0 We 88 m oSg'000 oo+Ouvoo8aoan8N88888S88 m ON 3 m G 3com =3-I 00 NO A fJ t CO 0 0 N 0 0 N 0 0 O 0 A O V 0 V p0 O O i0 OO 0 0 O 0 N (0) + + A 0 N 0 0 0 -0� 0 0 0 N !D tt0 + LT 0 0 0 0 p 0 N to O+ 0 0 0 O p O p O O p O 03 CO 0 0 0 0 A 0 S S S O 0 40i r S S S> O> coo o N o S S S O O O O 9LZtILPtP enleAIayielp N A m A y CO CO Of IV a L" �J. ovcth v _ x y0. W 0 0 0 0 O 0 N yW 0 { 0 N 0 p 0 y A 0 0 O N f0 00 + 43000 Ol O (0J tJ 0+ 0 0 0 0 p 0 0 0 O m O 01 g O O A S S S S O m W v S S S> S Y 00 S N S S O S O S S O O 0 0 0 W W W W co 0 0 0 0 W W 0 0 0 W 0 0 0 0 W 0 0 0 0 W 0 0 m m o 0 0 0 0 0 o a o 0 0 o 80 0 0 0 0 o a o 0 0 o a o 0 o n^ a > > > D > y•> > y D > > o 6i u ii n n hi t m Y m m m ii m b m m m m Pi m u ii Oi bi ii u Y n Ii g N m N m m CO m m m m m m m m m m m m N m m m m m m m TO m m m CO 0 OI 0, 0 0 0 0) 0 0 0 pi CO CO 0 0 0 0 0 0 0 0 0 CD 0) 0) CD 0 0 0) 0 1 + 0+ (.1 0 CO 0 CO CO CO CO CO CO 0 CO 0 CO CO 0 0 CO CO CO CO CO CO CO CO CO CO CO CO CO N CO J 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 N 0 Y fl� m m 00 FIE m N 0 mT a a Total Investm.nb and Average SB'06CZZCtL1 99388'146'6LI 08'116'CZB'BL1 ZL'Z80'81Y8L1 a6eleny pus Igolgns CO 2 0 ~ N m = v w ✓ 0 0 0 0 0 S o 0 o n < 1 m m °u u m c g N y e a v 0 C C c 0m O A LT Z Z E. r y.4 e m m % n m as 0 0 i m m j y -Ni ° 0 i Z D D p r N m m ° r O m N N D Z x N m N mm �r m — C C0 m A x, N Ss < m c m + m m m m o o A °a O + n Epp O N Y ° and N O m T CA CO ▪ W-4 0 0 NI m m S N O m m N O 0 O O S 0• + CO (0 m - Y S S S N+ a Y 0 N N N - n pp 0 0 O 0 6 m a O O m N m N Pp 8 S J ▪ V V V V 3 O G O O O O O ,mrr l e. O N N Et J N1 mo m + - + + n O + ° to O No 3+ 3 y SS n= 0 N N q 4 0 O a s 10 03 Total Cash and Investments 0911L016610L1 L6'L9L 969'ILL Cash Subtotal and Average Balance 000000 N 0 CO 01 Y W V # luaugaaaul A O r- 0 0y 0 O T M N<_ c T m ccF c m -1 D Z 3 O f O c D P2z o m r rrnr x D x x O c r_ Z O O c Z m m m y O n—mZ m x x O P Z 0 OO e O c - c ma io - m m IDm < H m ; 3 10 — O IS En es CO D 0 O O O O O O 1 O' 2 M V V V V V `J C /1� O_ C T O O a O O a �1 \/ O 0 a 0 0 0 a f3 m m V 8 gSoO�g aC c � = c o 0 0 F s c ° 3 .0 s w so m o y O ▪ 0 0 3 N to 0 CD S 3 - o • d+ ab 3 1 N + N + V N O a N N+ W O 0 N O + (N� Oca 0 Y O 0 V Ot.y a N www 0 p 0 Y V a 0+ m N+ O SYSZS'Slt OLI 2 N 0 N W O td W W Y :a(N co U a W Ca 01 O co CO a. NI WW CO CO a N W+ 0 W + ) W + O 0 0 0 0 0 0 §88§§� enIVA 1eyve YIELD (%) YIELD (%) 01 N La O n 1 - D e S r NNa ulele l(A(A(pip HfA d)fp O', 0 N cz T' _ 0 Q m C J - -, N N W+ N N C C O < m0 L W Wna 0 SJR�AA�SO5� c0 (55J��¢A¢ !- Q -0 O ,` al 89 mc>.0�n �y85��5��8285�5 N 2$5� �i ^8'yam p • 8 9�r ▪ aOrll NA OO(0 0 0) (Wn OO g m 0, u g 0 0 9 J O J 8 8+ 8 A N 8 8 8 V o ar-00 m IQ C < Oy SNNwf9 v+w Fn viw Fn Fn v+Nww Z < m S0 Q m > E_ c. 6 2 E m O▪ � c 1 A < = y -4 m -J ((O�J mpa (y��8+80 O pO (A� C o O m 2 D fJ NGl 100101 4Ol NO W TOOr O m j> �WJ QQm yn>p8gr �p 88JAN 8 z8 ;+ D N A O N N N O W N N N i �N 8mN 88ES i�888ER.s tTT co m H(RfRomeaa 6646HNN 'i a a°o m N• i -0 N O O N P T N 5OQ� - J --, 0 2 A 8 N . 1111 YEAR T-BILL YIELD ■ LAIF YIELD OCITY YIELD SO131A 3AILYHV4 WOO � c N 0), `0. 25 N2m 8m� 't 8s8 $ MILLIONS RS 001� pN 01 0 cr. CITY PORTFOLIO BOOK VALUE n QN X N u C EEC m33 OrmEOR 33 <m=O n FnE orAO m r yae yW0 ca W Sy - -13 Ai PORTFOLIO (%) statatithis 0) 0) N CO 0 0 AGEING OF PORTFOLIO MATURITIES CITY OF PALM DESERT INVESTMENT ACTIVITY REPORT AUGUST 2000 (EXECUTIVE SUMMARY I As of 8/31/00, total portfolio book value was approximately $178MM. This reflected a net increase of approximately $5.3MM from prior month due to a timing difference in sweep account coverage. There was an unrealized portfolio net gain (market value - book value) of approximately $135M, based upon prevailing market interest rates. This was only a "paper" gain since there were no premature securities sales. Significant changes in investment position are shown below: ") Inited States Treasupl_Coupon" The City buys interest -bearing U.S. Treasury notes with maturities of 2 - 10 years to invest assessment bond proceeds. Although unrated, considered "AAA". THIS ACCOUNT BALANCE DECREASED BY APPROXIMATELY $100M DUE TO A MATURING SECURITY. "Federal Agency - Coupon". The City buys U.S. government agency and instrumentality notes with maturities of 2 - 10 years to invest assessment bond proceeds. Agency debt guaranteed by U.S. Treasury; instrumentality debt is not (guarantee, instead, believed to be U.S. Government's "moral obligation"). Although unrated, considered "AAA." THIS ACCOUNT BALANCE INCREASED BY APPROXIMATELY $7.9MM DUE TO SECURITY PURCHASES. "Local Agenry Investment Fund (IAIFI". The City temporarily invests proceeds of matured securities in $13MMM pool managed by State Treasurer's Office for 2,600 governmental entities. LAIF has diversified portfolio (BAs, CP, Treasuries, agencies, corporates, repos, reverse repos, CDs) with weighted average maturity of 180 - 540 days. THIS ACCOUNT BALANCE DECREASED BY APPROXIMATELY $10MM DUE TO DRAWS FOR SECURITY PURCHASES. "Federal Agency - Callable". The City purchases federal agency securities that may be called prior to maturity, in order to obtain an additional premium for that risk, thereby increasing overall portfolio profitability. THIS ACCOUNT BALANCE BALANCE DID NOT CHANGE. "City Loan to RDA" The City has made long-term cash advances at LAIF interest rate to RDA for property purchases. Advances will be repaid in future years from tax increment revenue generated by associated redevelopment projects. THIS ACCOUNT BALANCE DID NOT CHANGE. "Federated Govt MMF Poo(". The City invests assessment bond proceeds (construction, cost of issuance, and bond reservereserve monies) in "Fidelity Institutional Money Market Fund: Treasury Portfolio - Class I." This $3.9MMM fund investsin U.S. Treasury bills and notes, and repurchase agreements for those securities. Weighted average maturity is 60 days orless. S&P credit quality rating of "AAAm'; Moody's of "Aaa". THIS ACCOUNT BALANCE INCREASED BY APPROXIMATELY $5.5MM IN ANTICIPATION OF SEPTEMBER PAYMENTS FOR DEBT SERVICE. "United States Treasury - Discount". The City buys noninterest-bearing zero coupon securities ("STRIPS") with maturities of 6 months - 30 years, to invest assessment bond proceeds. Purchased at discount; face value paid at maturity (difference is yield). Although unrated, considered "AAA". THIS ACCOUNT BALANCE DID NOT CHANGE. "HighMark Sweep Accounts". The City sweeps excess checking balances into "HighMark 100% U.S. Treasury Money Market Fund". This $905MM fund invests only in U.S. Treasury bills, notes, and STRIPS (no repos or reverse repos). Weighted average maturity is 90 days or less (per SEC regs). Although unrated, underlying securities considered "AAA". THIS ACCOUNT BALANCE DECREASED BY APPROXIMATELY$6.7MM DUE TO TRANSFERS FOR DEBT SERVICE. "State S Local Govt Series - Time". The City buys special noninterest-bearing U.S. Treasury certificates of indebtedness with maturities of 15 days - 1 year, to invest assessment bond proceeds (to comply with IRS yield & arbitrage rebate regs). Nonmarketable. Although unrated, considered "AAA". THIS ACCOUNT BALANCE DID NOT CHANGE. "Medium -Term Notes" The City buys interest -bearing corporate medium -term notes with maturities of five years or less, to invest revenues. THIS ACCOUNT BALANCE INCREASED BY APPROXIMATELY $8.7MM DUE TO SECURITY PURCHASES. SOWN W4a1-wnipayj sawuef y /eiapaj sepnseail •s•n CJ( A CO N W N Cf);E 6.5c (b 0 7ng f DD TT� NNNN-+�oni N M CD 00 CD CD CD CD CID M x N d O 0 �C 7 ok� Q. Qry CO p.-i 240 W NoO(ct{QQ '(D C7 N ."I d O,_ 0 (O CO (a • -1 Z Z N O 0 d N f0/1 W C m Q .� a C7 C O Z p C A A O 'O CD m o M m m CD = o • 0 m g d E. o r- O N O. 7 O B n. N i., d= A O C c � O A c O -0 to W n Qo o •N o610 go g; C a Q N COfiO O' A N y n 0 O O C. 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CCCCCCCC z z z z z z m ZZZZZZZ z m m m -1 ti m p m m m m n m m m 0 0 0 0 0 0 , 0 0 0 0 0 0 0 0 N m 0 0 CO 0 m CO 0 CO 0 0 0 0 CO H H H H H H p H --I-i -1 -i 1 1 -I D D D D D D m D D D D D D D D -IH ti -Im- m m m m m H r ti MMTMMM MMMMMMMM 0 0 0 0 0 CO CO CO CO 0 CO CO 0 0 mA mA m71 mA mD mA mp mA mA mA XI A AA 73 D D D D D D D D D D D 0 CO CO 0 0 0 CO 0 0 CO CO 0 0 0 CCCCCC CCCCCCCC 71 71 71 71 71 71 71 71 71 A A A 71 71 < < < < < < A < < < < < < < < a CO V pV a 1 N NOdf1O0 - ASOSV3Nl Sfl °Beneny PeelelolgnS 9L'L081611'9Z NJ 0 0 LOCAL AGENCY INVESTMENT FUND LOCAL AGENCY INVESTMENT FUND GBeieny pue 'miens OLZBZPLS'OZ + O a W N+ 0 0 V 0 A W T T 71 T 71 T 11 T T T T T MMIMMMMMMMITM m O 00000000000 MMMMMMMMMMMM m MM m m MMMm MMMMM O 00000000000 O 00000000000000000000000 SSSSSSSSSSSS 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 KKK 3 3 3 m m m m m m m m m m m T 100d jW W .AOO O31V193O3j 0 N v 8111eo4eenel q b 0 < Is 00 O 0 1 1 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 00 PaE J V V V J J �il �1 J J J J `` -0 V aaaaaa aaaaaa q aag oo • 0XMaI a a a a a a Q O N N N N N N V m m m 0 m 0 m m top m m m m o 0 0 0 o m m O O m J J V V V V 0 0 0 0,0 0 0 0 O D o m c G O r co O O 0• 1 E 0(y� N N N ▪ p (N� 00 (N� L ( N� N0 0 J 0 0 N N 0+ 8N O VW A ( O/� N W ▪ m O N 0 V 01 (Jn O o 0 o O o 0 0 0 V OV 4 A O+ O O O O O o f• 01 O O Y • V Q < 000000 0 o0000000 W m o m00$'0888 0 -88 0 o y 3 D ci' z A ++ a m o 3 y 404 n p1 ▪ y0 N m N A N 0 0 J J 0 N N O OJi t00 b 0 A 0 N 0 I (00 0 ( 0 0 (O0l N V A+ A (qp 0 N P W 0 N O 01 N N W V Ol �JI W N CO10 (y0J N N W A CO (Jl1 0 V N a O A p 0 0 0 0 0 CO NJ 0 0 0 0 o O O O 0W a 0 0 0 CO 0 0 t0J 0 W O 0 o O OI o 0 0 o V+ 0 0 en A N 9' o pp�� W 0 a s ++ jJ� T ON 0 0 ... a N 0 N V 0 0 0 m N J O 0 0 A O N 0 O 0 0 0 O 0� N 0 0 7 N 0 J { 00 V W Ol N con N N O J 0 V OI 0 4 0 W 0 0 ul A y 0 y 0 V p N A O+ O O p O O p O 0 W p O p O 00 0 0 0 o 0 0 4 A A N+ 0 0 4> W m O m o m 0 o O o O V+ O O rE 0 0 0 0 0 0 t0 0 COCO0 0 0) 0 0 0) CO0) CO0 0 0 0 A& J N 010 0 0 O N O 0 CO CO CO CO CO CO CO 0 0 CO CO 0 O N 0 0 0 0 0 0 0 0 000000000000 60. 3 o y y y y y y y y y y y y8 00 00 00 m N u W 0 0 b 0 0 M LI N N N 0D 6t 0D b 0D N b N 0 N 4 00 00 00 00 N 0 CO 0 0 0 N 00 0 0 W 0 0 CO 0 0 0 0 0 0 CO 0 0 O 0 m y yy p 3 0 A to 0 A N b a + A 0 0 0 (NO N a o + LE 11 O O O O O p O �00 0 N N 0 N N 0 0 y01 ( 0 0 0 0 0 0 0 0 0 0 0 0 0 0 <Z N O O O O O O O1 0 top W (a�f WOS O O 0 0 0 0 0 0 0 0 0 0 0 0 0 W C 0 0 000000 W 0 0 N N N W W 0 0 0 0 0 0 0 0 0 0 0 0 0 0 O p p N 0 A O W O (O A O O t0`0 0 0 0 00 0 N 'p 3aoI O Waaiza. Wa 3 9 cm O D O a a a a N a a 0 i 0 et> 8080o0 O O O 0O O0O000000O 0 + O N N N N++ O `Z A Ca 0 Ca 71 i CD CD CO CO CO mIcQo0 N fVil u m0 S 19 9 1▪ 0O 104 u 0 CO C mT 3 4 4 4 4 4 0 0000 > 00000 01 N 0 r .0 V V G L i O 6) (0 m CC Z m o 0 m o t y Total Investments and Average 96110Z'0ZE'I11. 881189'96V'ESt 09'9C8'019'191, 96'986'LPS'OSt e8eieny pus molting O 0 0 0 • 0 0 n 0 0 0 0 0 CONm V C V 0 0 C• ND CO KJ V 0fIQ N.l O Z Z Z e en - e 0 0 0 1' t. m m m =__ = CCCCC O 0 0 O 0 ZZZZZ 3ym1 my1 my1 a N fC/l y m 0 m 0 m F r r o O 0 0 m 0 0 0 N Ol O 0 0 m C C m D D D D D ti m m ti 16 m m o== 1 N N N N 0 • 0 0 p x 1A1��11 7�13I m 71 p�111 m • Z Z O1 01 N y N N N O D D m m CCCCC 11 A A A A N N z X . MT I' m<<<<< Ota ✓ 0 0 m m G la V n N Ap ✓ P 1+ 1NflOOSIO - A79fSV3Ul Sfl °Beneny pue 'moving ZC'4V9'6S91 A 1N.t 3W11- 1A00 11/301 F 31y1S 0 c co p iuewlsenul § 0 0 0 0 O ▪ A aN N a aCO 0 C 0 ___ N NN Na 02. av 0 (O 0 0 0 ( 0p CO E. co 3 M O 1 0 0 m (00 (01 (01 0 11 0 0 0 O 0 O D 0 R1 mp�r .O 3 U ✓ N 4 N 4 4 0 V N 3 ✓ A 8 0 0 0 N b: N A 0 0 (NC + (a+i 9 W N 3 1.1� 0 N O O 0 O 1i b N e 0 0 Y 1 J 1 �111 O S O O 4 • S N 0 0 0 ▪ 0 0 0 N 0 V G V ` O O O O N N 0 0 0 0 0 0 0 P 0 V 1 O< eQ —1 O S S S 01 N CO CO O O S S S S O S S 0 CO y • > /3 0 0 3m 7 K /Z� \J• V N N+ 4 4 0 y 0 N 3 (0 1 0 0 • V 0 0 0 N 10 0 A S A V INO + (y F 1 O 0 8 0 00 0 8 O 0 0 0 V V 0 0 A A ^ 1 N 0 O O N N 0 01 0 V A A V 2 O J 1< y .(.l . _ A A 0 0 N N V (00 O N O+ W 0I O S S O 7. V N(+p 4 4 m m i ni (p 0 CO N N N t • Wp 00 ▪ • 4 0 (0 N (0 0 ▪ + 0 (.+l 0 8 O (O O tli L 0-en 0 0 0 A A 0 O ( V� tOli V N N co + S N- tVp N O 0 V ✓ 0 m N N 0 V 0+ N V N Ol L O O O OCO CO CD A 0 0N •N 0I p� co ▪ + ++ Ol Ol N N O 1 m 0 al0NII 0 0 N N O CO A O. 3 Z. y pO 1D b m b N m N N N N 1 CO 0 1 CO CO 1 1 1 1 0 q J. ++ yy++ (y m O A A 0 • N 0 0 + CO ▪ V0 m A N V N A O m 0 I-o 11 4 0 m N N 01 VI 01 0 0 0 { 0J1 4 4N O O 0 O • 0 m O • J OI ((21 .1 J J N J V A p 4 Y 0 0 0 4 1 3 N O 0 V 0 0 0 0 0 0 0 0 0 O 8 S N fi p g g 0 0 0 0 O + 0 qQ m m 0 CI N 0 0 u A 5a� IV3 IJ3 I�. r47 r5�3� 15N3� IN3 n�3 13 p 1 m • •0> R$$ 8 g 5 K$ 0 0 m? w 60 0Z - 000=1/60 :61e0 enel Total Cash and Investments 1.1'01.LbZS'LSL S9'CLS'CL9'CSI LE19L'LC6'LSL C6'LL6'VLt'I9I. Cash Subtotal and Average Balance O 0 • C O CO S 9 0 0 0 O ur ur tuewtsanul 2 2 0 w O O m O • 0 r 2 0 O -0 D D 13 2 2 -I 0 0 DCO • 2 2 Z 7 -63 m 0 > c C ? m mD j m m m L. nm N m P mot tuno3ay yse3 m 0 o m c o o m ct _r c C O ect m d m • c I 2 • o A > o H 0 S a Z 0 • 0 - • 1 m N O 1 O 0 ▪ O b • K.,0 N to fJ O 0 0 a 0 0 0 n O O N Om 0 000 04 N• —CO oz 0 v 8 p m I' a ▪ s o c m ✓ m0 y 0 M u m' 3 8 n Y w a m O r•C 75 Y A. ]I a a la O T m N O SO O1:1 is oo 0 m O O O N a A 3 to 0 0 9 0 ,1 0 v O mal enIeA $ YIELD (%) N 0 0 0 YIELD (%) A N N m V 0 0 m w 2 to op mswma c_ 8 Y 8 0C C w 7 N A 0 I• 9 m W t F m is P6 0 s 2 r T c m le 0 ID 6 a 85 $ MILUONS P ID N !i I reavAst FiggOisar g lokle: El 8n a ISY4 ;'DO W'°MOT=COC-S, y'- 20mz e0K m• D. mmDMI o Mstr- TDmWm rw 2 p r R r a r y (/D�oro OD O rTLi9 �(/1C co o m z_vz,,<,-<z or wi �pm<13000-4 $p m D • .Na8c m$Y'i 0)0.80 "m B m ogyzazo $om 2tim C • T C (/l fl> r ill N 88�ttr�II m0 ? 0aw NO m 0 z O z D m cow• wwwwwwwwwwwwww 9, w c m a N ppDJJ - • W V ( W� N N A ((O��i oo+Oppp mmor o a • m i V A m E N V V A N N-<O • F C)j ((JJ aAO+A 0.408, r • m°""§„ raP-5 8� '�w ' s =_t8f& 88'�8$' 888. giI P — �z 5 owwwwwwwwwwwwwww z o D D W mV W N N 8 A m p m_ a fmOJ N V c0 0,, 0 0 ,, pco a p H (l(�(neaepp N OmNm:pp8 7-8- rn 8 k V V N 28 8 810 wwwwwwwwwwwwwww 0 ry • o 03 a o s ; co a]N i IMT). N q" w K P -I •'xH a m • m O m a. o <mE0 X m D O C m >33 00z0 • cn 0 c aam. N 1- ni 0 PORTFOLIO (%) O W 8 m 0 a m s 0 _ zN m tiya a c m o 5 A .3330 gq O r Om cz oa O z 0 8 8 5 8 8 REDEVELOPMENT AGENCY INVESTMENT ACTIVITY REPORT AUGUST 2000 IEXECUTIVE SUMMARY As of 8/31/00, total portfolio book value was approximately $151 MM (with SLGS). This reflected a net decrease of $895M from prior month due principally to reimbursement to the City for Club House expenses. There was an unrealized portfolio net gain (market value - book value) of approximately $190M, based upon prevailing market interest rates. This was only a "paper" gain since there was no profit-taking. Significant changes in investment position, by security type, are discussed below: "State & Local Govt Series - Coupon." Palm Desert Financing Authority buys special interest -bearing U.S. Treasury notes with maturities of 2 - 10 years to invest proceeds of advance refundings held in escrow (to comply with IRS yield and arbitrage rebate restrictions). Although unrated, considered "AAA". THIS ACCOUNT BALANCE DID NOT CHANGE. "Federated Govt MMF Pool." RDA invests tax-exempt bond proceeds (construction, cost of issuance, and reserve monies) inFidelity Institutional Money Market Fund: Treasury Portfolio - Class I." This $3.9MMM fund invests in U.S. Treasury billsand notes, and repurchase agreements for those securities. Weighted average maturity is 60 days or less. S&P creditquality rating of "AAAm"; Moody's of "Aaa." THIS ACCOUNT BALANCE DECREASED BY APPROXIMATELY $514M DUE TO REIMBURSEMENT TO THE CITY FOR CLUB HOUSE EXPENSES. "1 ncal Agency Investment Fund (LAIF)." RDA invests City's loan in $13MMM pool managed by State Treasurer's Office for 2,600 governmental entities. LAIF has diversified portfolio (BAs, CP, Treasuries, agencies, corporates, repos, reverse repos, CDs) with weighted average maturity of 180 - 540 days. THIS ACCOUNT BALANCE DID NOT CHANGE. "United States Treasury - Coupon." RDA buys interest -bearing U.S. Treasury notes with maturities of 2 - 10 years to invest tax-exempt bond proceeds. Although unrated, considered "AAA". THIS ACCOUNT BALANCE DECREASED BY APPROXIMATELY $168M DUE TO A MATURING SECURITY. "State & Local Govt Series - Time." Palm Desert Financing Authority buys special noninterest-bearing U.S. Treasury certificates of indebtedness with maturities of 15 days - 1 year to invest proceeds of advance refundings held in escrow (to comply with IRS yield and arbitrage rebate restrictions). Nonmarketable. Although unrated, considered "AAA." THIS ACCOUNT BALANCE DECREASED BY APPROXIMATELY $372M DUE TO A MATURING SECURITY. "United States Treasury - Discount " RDA buys noninterest-bearing zero coupon securities ("STRIPS") with maturities of 6 months - 30 years to invest tax-exempt bond proceeds (construction monies). Purchased at discount; face value paid at maturity (difference is yield). Although unrated, considered "AAA". THIS ACCOUNT BALANCE DID NOT CHANGE. "HighMark Sweep Accounts." RDA sweeps excess checking balances into "HighMark 100% U.S. Treasury Money Market Fund." This $905MM fund invests only in U.S. Treasury bills and notes (no repos or reverse repos). Weighted average maturity is 90 days or less (per SEC regs). Although unrated, underlying securities considered "AAA." THIS ACCOUNT BALANCE INCREASED BY APPROXIMATELY $151 M DUE TO INTEREST INCOME. "Federal Agency - Coupon." RDA buys U.S. government agency and instrumentality notes with maturities of 2 - 10 years to invest advance refundings and tax-exempt construction funds. Agency debt guaranteed by U.S. Treasury; instrumentality debt is not (guarantee, instead, believed to be U.S. Government's "moral obligation"). Although unrated, considered "AAA." THIS ACCOUNT BALANCE INCREASED BY APPROXIMATELY $5M DUE TO AMORTIZATION OF DISCOUNTS. "Federal Agency - Callable". The City purchases federal agency securities that may be called prior to maturity, in order to obtain an additional premium for that risk, thereby increasing overall portfolio profitability. THIS ACCOUNT BALANCE INCREASED BY APPROXIMATELY $2M DUE TO AMORTIZATION OF DISCOUNTS. "Medium -Term Notes" The City buys noninterest-bearing corporate medium -term notes with maturities of five years or less, to invest revenues. THIS ACCOUNT HAS NO CURRENT BALANCE. Bankers's Acceptances seioN weal-wntpeyj sapueBy tewaped seunseau 'sp 3dA11N3Y91S3ANI co N -+ Vt A W N co N co DD o> -I TT T 7 NNNN- 0 al cc x° (0 (n n0 Z N N W 0 O O O OO N (� 'p c ^ chi Qm (n _�� aaam wn�i�o(`Do<Q'-CD _ (A A C 7 y^� -i Z Z== N ?:;- co (D (D O G O »: CO N W -j Z °° N -, (A CO CO c Z (ED O N n N 0 Z c N N CD N j N O O .� m 9 ^ n^ Q nK �. o o^ N D 1 a a co ae o�.mm o>j o o0 a- 0 mi eg O 0 2 OT a N N^ CO co_ et - CD 9r z 7 ° O NO °. N^ N O ° ° O O. n13 Ti 0 o N °° cn w y �° x o O D 0 n 0 N N d 0 O° O 05. ° 3 n i O d N O n O. -I 0 D W ° 0 N ° 0 0 0.N. N ui n n W 0 CD 0 ' 0 3 Ti 0 o•• 1 cn"Cl _n ti r D o m n D D c-) y 0 Ti c A A 0 (O 0 (O a ri CD O CD0 0A —I 0 0 0 0 0 0 0 0 0 0 0 o he 0 0 0 0 0 0 0 0 0 0 o m O Z r 0 10 EA EA 69 EA 69 EA EA EA EA EA A9 EA EA N o o co co 0) 0 xi 0 W (O W 0 N c 0 0 (0 -a O > 0 -co co O O _ r r coN V 0 1 1 i CO I (CO N 0 0 0 3 < < < < < < < < -< -< v _ o CO(0(0(0 mm (i�ai cn mcm(0 rz D z 0 m cre to 2 co to to k \ \\w0 Z % t${\i9\a aFc3Ja 3 ?flK0 W =A ° 0 00VZEe= • 413 —4 \ \ 0 $ /// eo\O DO §\ «[ • =4 0 co \TL «*«« mmmm em=e Jaded 1e;aiaW WOO ran 3dA].1N3W1S3ANf linen &Of1Od VC \k ats \ an 73 •0 >0 en§ 0 \e m 0 I a m O D m z 0 m to O n 8 8 m 8 c J 8 ''0ii I c c m8 YIELD (%) A YIELD (%) N 0) m 0 ° at 0 O T z O C r O 6 O W D DWOmmy2CmOm5mCy :0:aZ �eOD=�m�B"8�'m �c..,x m--'� ;oan�i:m�-4n� r>,, ;Ti! -iRr� mz ?cJm1-ma--NDOOm mD (prim anz�m<p9n �< m{Oo-0°SDC CO Cmpyo ; O ODN (, mao r p iDz D 0 mOcyy=y$ 0 Cp c mz,p z 0 r I- Z 0 -I (nm -< RI m O m -Ie0 0 K 5 a z m m ° o y e0 jw w w IA 0 .000 EA elm m EA00 I TI O, z F 2 W T.. m n .. O mm C V -JJ -t- 8)p�pN 88_W 88+N88(mm(..'cC m0 m SCg A▪ 88 A V (W8§8P 8§t N�€ g r ▪ ; (0 tx:(: (+� NAN Ob(N(l� W NO(W(:�O j'5 p GE m J$ V S 8 k) 8 111 8 8 8 4: Oy rm vi Fnviwwwwwww646646449-.6 Ez 0 $ D m O c 1,1 V a ' O b o co o O ro O a A CI 9PS ° Soo8m� pp�8�o, 8N 414.G� pt§g (N�pN�AO(�N pNp O OCIN f .8.2S ig.T .2N! 000000000000000 N N m T 4' O� V igill ffim m8m P pU A8J .O O 8 8.Nam H 88{n O m .8 $.S $ MILLIONS CITY PORTFOLIO BOOK VALUE N N W • W PORTFOLIO (%) AGEING OF PORTFOLIO MATURITIES 1.1,60 - 0002/0L80 alea °aa 'eloping 000Z iagweldeg r.2° s 0 co Li §§ |$ ){B 2§ g;aaUUSGAUI L1 \ �� c 0 CD -I ; \) \k l CO 0 _ _moo z §ca-0 0 n ° » we I— ,� t0 _ o Em ƒ;m 2k0 1 | 0 DJ P4 ay co !\ `C iff CD NI Ul \0 § 3 § - & 1,060 - 000V06/60 ale0 ana v 0 b m # ,ueugeanul T + c 3 n i H 0 0 a m a � c » 0 A8lSV3ill S31VLS 0311N1 0, co -aa A pj 3 m c m co r c o W N Z o m — --I0 m `o 3 D 3 m 0 a3 mN vo co H Z ai 3 m m O 0 g a e 0 I 0 SI 3 0 g S 0 to c y P o Qa J + Y t 4 P 0p a 3 ca p Y C O O O c m al O1 zB a to 0 0. 0 0 3 3 0 1� WAS (pi dad) IIN IsioignS 000Z isn6ny # losogsan!I N 0 m c 6 sm O Y O • m Z 3 3 CO u u 0 0to 0 v v o0 m ; o o ego N Nco �o o Qn C 0 mom 0 z 3 5_ O 41 N Q A 0 0 D r n O • O 07 '11 3 r c 0 3 CCI v e► et A N w 3 rn ma N RI N 1 o o 0 1 000VOV60 ele0 'Intl IBo;gns 000Z isneny # ZUOU4SBAUI v a r N t0 C � � n 0 o ai < p Z z m m m r. 0 0 cofi c xicc m �dm za Es m C • 7 O o� > < m C H al Z m to 00 0 * N 3 Delk^ . al z '-S - H om N 0 ma 0 -< 3 i 0 m cn ow m m -hi' m N N 0 N O G� N N pN O m O O O O Li co to 0 n O 3 3 0 0 S;uaw;SOAUIle;o1 oossy 6;yN IeuogeN pad Nue8 ueoi awoH leJapa3 )jueg ueo1 awoH ieJapa3 wen ueo1 awoH IeJapad )Iue9 ueoi awoH !ewapa3 'WoO Nue8suoi;eN •dioO aoue;daooy IND •Woo Ie;ideO 1'81V 0 c 0 0 'dWoO Ie;ideO 30 S31ON INH31-WIlIO3W ER EH EA fA EA EA 69 Ell Efl EA EA N W N N W N N A N N N N L N 0 0 O 0 0 0 0 N O O r D. .co o O o O o 0 o C1) o O C A 0 0 0 0 0 0 0 0 O 0 m 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 $ 1,997,920 $ 16,194 $2,014,114 $ 1,996,560 $ 5,521 $2,002,081 L96'000`E$ £l£'E $ Efl Efl EA Efl EA Efl EA EA -D (/) N w N A m Z 0 m `-'4 0) (0 w a .° 03 (0 C O) ON) N Oo) a 0 A N D D XI o 0 0 0 0 0 r O q m0 n N CA mc � co Z A T toy DD -Ir im Dm 0 xi --1 0L0'900'Z$ 0$ 4LE'L96' I $ 499 919' 196'2$ 066'940`Z$ 9E9'ZEL'Z$ 044'940'Z$ 64E'640'Z$ 6Z1'09 $ CDCO0(OD COO V (00 (00 COO (00 (.0 W (0 Co N 01 a) (O OG A O co N O) W O 0) (0 V a) a) a) rn o) o) v o) a) o) o) (co 0 coN co 'co N O D (1) (0 D D T T D V T O O D c (o (o Q v c m C v A 0 0 0 0 0 0 0 0 o m N N N W o N N 0 0 r 0 co N co co CD co Aaiue;g ue6Joj Aawe8-y;iwg uowoIeg Aawe8-y;Iwg uowoIeg eouawy;o oueg Aaiue;g ue6ioj Aaiue;g ue6JoyJ A N N 0 -n m N m N m A 0 0 C -1 N 0 0 0 PHILIP ANGELIDES TREASURER STATE OF CALIFORNIA INVESTMENT DIVISION SELECTED INVESTMENT DATA ANALYSIS OF THE POOLED MONEY INVESTMENT ACCOUNT PORTFOLIO (000 OMITTED) TYPE OF SECURITY Government Bills Bonds Notes Strips Total Government Federal Agency Coupons Certificates of Deposit Bank Notes Bankers' Acceptances Repurchases Federal Agency Discount Notes Time Deposits GNMAs Commercial Paper FHLMC Corporate Bonds Pooled Loans GF Loans Reversed Repurchases Total (All Types) INVESTMENT ACTIVITY Pooled Money Other Time Deposits Totals PMIA Monthly Average Effective Yield Year to Date Yield Last Day of Month JUNE 30, 2000 AMOUNT $ 2,223,185 0 2,322,572 0 $ 4,545,767 $ 3,287,995 7,220,205 1,920,008 $ 36,707 0 7,296,607 3,648,440 1,306 10,447,951 12,643 2,464,885 2,147,798 0 0 $ 43,030,302 JUNE, 2000 NUMBER 573 31 98 AMOUNT $ 26,387,241 310,185 785,440 702 $ 27,482,866 6.349 PERCENTAGE CHANGE FROM PERCENT PRIOR MONTH 5.16 0.00 5.40 0.00 10.56 7.64 16.78 4.46 0.09 0.00 16.96 8.48 0.00 24.28 0.03 5.73 4.99 0.00 0.00 100.00 MAY, 2000 NUMBER 559 36 109 +1.34 0.00 +0.35 0.00 +1.69 +.07 -1.42 -.95 0.00 0.00 +1.32 +.33 0.00 -3.77 0.00 -.09 +1.37 0.00 -1.45 AMOUNT $ 26,013,152 693,464 1,989,900 704 $ 28,696,516 6.190 5.708 5.638 2 Pooled Money Investment Account 6/30/00 Portfolio Composition $43.0 Billion Corporate Bonds 5.73% Commercial Paper 24.28% Bankers Acceptances 0.09% Loans 4.99% CD's/BN's 21.24% Treasuries 10.56% Time Deposits 8.48% Mortgages 0.03% Agencies 24.60% ElTreasuries El Time Deposits ■ Mortgages 5Agencies B CD's/BN's CI Bankers Acceptances ■ Repo CICommercial Paper ®Corporate Bonds ❑ Loans CI Reverses 3 REVENUES 1 Tax increment 2 Interest Sales of Property 3 Reimbursement From Other Agencies Other Revenue Transfers to/from other funds TOTAL REVENUES EXPENDITURES Administrative Costs Professional Services 6 Property Tax Administrative Fee Cost of Inventory Sold Payments to Other Governmental Agencies Bond Issuance Costs Bond Discount 4 Interest And Fiscal Charges 4 Principal Payments Capital Outlay Office Equipment Undergrounding Projects Deep Canyon & Hwy 111 El Paseo Improvements Parking Spaces Fred Waring Dr. Street Improvements 1-10 Cook St Interchange 5 No. Sphere Infrastructure RDA Projects Desert Willow Land Purchases/Property Acquisition Business Enhancement Loan Programs Regional Park #4 Transfers Transfer Out Administrative Costs Transfer (In)/Out Capital Exp Reimb Transfer Out Low/Mod Set -Aside TOTAL EXPENDITURES RDA BUDGET 33,964,500.00 1,342,380.00 1,015,000.00 36,321,880.00 PALM DESERT REDEVELOPMENT AGENCY COMBINED STATEMENT REVENUE AND EXPENDITURES COMPARED TO BUDGET 31-Jul-00 TOTAL RDA RDA % OF ACTUAL YTD BUDGET ACTUAL TO YTD BUDGET 2,830,375.00 111,865.00 84,583.33 3,208.34 3,026,823.33 3,208.34 820,200.00 68,350.00 26,558.90 876,477.50 73,039.79 546,000.00 45,500.00 11,612,795.00 967,732.92 9,520,213.00 793,351.08 3,030,000.00 252,500.00 10,000.00 833 33 27,827.00 2,318.92 4,250,000.00 354,166.67 500,000.00 41,666.67 2,148,532.00 179,044.33 250,000.00 250,000.00 1,184,058.00 98,671.50 3,313,582.00 276,131.83 107,170.00 8,930.83 4,557,000.00 379,750.00 1,000,000.00 83,333.33 5,000,000.00 416,666.67 (920,000.00) 6,680,700.00 54,514,554.50 (76,666.67) 556,725.00 5,474.52 4, 772, 046.21 32, 033.42 0% 0% 0% 0% 0% 0% 39% • 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 236% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% (FAV) UNFAV 1 VARIANCE 2,830,375.00 111,865.00 84,583.33 (3,208.34) 3,023,614.99 FAV(UNFAV) 1. Tax increment is received in Jan & May 2. Interest is received as securities mature 3. Reimbursements are posted at various times during the year. 4. 4/1 debt payments of $6.5M are included here 5. Includes land Purchase 6. Administrative fee taken once a year 41,791.10 73,039.79 45,500.00 967,732.92 793,351.08 252,500.00 833 33 (3,155.60) 354,166.67 41,666.67 179,044.33 250,000.00 98,671.50 276,131.83 8,930.83 379,750.00 83,333.33 416,666.67 (76,666.67) 556,725.00 4,740,012.79 CAPITAL PROJECT FUNDS 00000 0 0 0 0 0 0 0 0 N 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 O N 00000 O. O CD O O 000000000000.0000000 O V 00000 0 0 o000 66 n 66 0 666 0 0 66 0 0 0 0 0 o m m a o 00 N N m O)- 0 0 �< O 0 m m .17E < o m m ! o m a< 0 O 0 0 o O q aN a CD m 7 'ETV m O0 a< o a 6 N N N 0 0 0 0 0 0 N N V 'n a O N m 00 00 0 0 0 0 0 0 0 0 0 o errn 20 000000$00 p0 ol_ ON pOoOMOLOm r00po 0 (\int O 0 0 0 1 O O h- 0 0 0 O O- OR do do ao -p-o o O m N N Nfl Or N 0 M O N 0 0 a fV r 6 OrO N C m o m m m m m N c6 > ca a m E m Q m ° m CDm a < p o¢ N m 227 toE O j m x< L `� m 2 m _> W ^y ON m --,..o 3 E m 5 2 BE m E a E > mint/ a= m (q m a ma tali; « m.- O C > . m. N C m u. 2w o2EN EccacmiO �cm;wts .EOi mcm W O <2 ac>.Eaco In mtot w`m Quo m o f ¢ tl! i x m W o w mm o f o 3 E umi m 5-E 5 m a y m Q ¢ `� o~= m° m m.m x U N Q m 9 c o O O I c m y-¢ O C c m m `0 = c m n' m m o d o m e r m umi of umi z A m, m r ~ _ o 0 o O O o w a LL- z¢ O m¢ y m m m > E m¢ O w< a` a O o. F w x m m ¢ w 0 F 22,999,846.50 TOTAL EXPENDITURES 0 0 0 0< o o < 0 0 0 0 0 0 0 0 0 0 0 0 I o 0 0 o m o o m o 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 o 0 o mO o 0 0 06 06 0 0 0 0 0 o N N O O 7 m DEBT SERVICE FUNDS O O O 0 0 0 0 0 co • • g 0 0 N CV rl rI 35,144,500.00 0000oo00 o 0 0 o o 0 0 0 o0ci 0rn00rioo O O I- N O � t• mt O CO NO • W C6 6,680,700.00 N d 5 c ° 1 Q c ToE Q LL O O ccH • N 0 a¢ O • > > E o E co > w m N N > co 1d co O L 0 m C 0 42 N () C a O LL r0 '2 U ._ O l0 'N V c o Et0 c> c E 3 c am dy<O cii E QO-J d o E o o a m m o c o o m 5 5 m a y m` 6a`I l` O H N, o_i Q a O c 0 0 U N O m m O 5 C N a Ea, V N a a t' w' °�' o -"y c0c F v' maE-ov d'6 fccc crt,ID- To' 'dt2, ccto�ccodmmmm • -So¢aaamm5a cr=��°O ox E 2 W 1- NI 0 O O O O 0 0 0 0 0 0 0 0 0 0 31,514,708.00 Total Expenditures/Transfers PALM DESERT REDEVELOPMENT AGENCY Schedule of Revenue and Expenditures 1 REVENUES 2 Transfer in of 20% Set -Aside 3 Interest Rental Income Sales of Property 1 Reimbursement From Other Agencies 2 Housing Mitigation Fees Other Revenue TOTAL REVENUES EXPENDITURES Administrative Costs Professional Services Property Tax Administrative Fee Cost of Inventory Sold 6 Interest And Fiscal Charges 6 Principal Payments Capital Outlay Office Equipment Acquisition Rehab/Resale #7 Home Improvement Program 1-6 Santa Rosa 4 Property Purchases 5 Desert Rose Portola Palms Mobilehome Park Housing Development Transfers Transfer (In)/Out Administrative Costs Transfer (In)/Out Capital Exp Reimb TOTAL EXPENDITURES Notes: Budget 6,711,700,00 15,000.00 56,000.00 6,782,700.00 3,901,385.00 293,305.00 5,000.00 948,933.00 392,691.00 503,462.00 93,279.00 74,386.00 2,000,000.00 YTD Budget 559,308.33 1,250.00 4,666.67 565,225.00 325,115.42 24,442.08 416.67 79, 077.75 32,724.25 41,955.17 7,773.25 6,198.75 166,666.67 31-Jul-00 HOUSING FUND (FAV)UNFAV Actual YTD Variance 2,744.81 559,308.33 1,250.00 1,921.86 42.90 (42.90) 2,787.71 562,437.29 FAV)UNFAV) 11,411.74 313,703.68 24,442.08 416.67 143.53 78,934.22 32,724.25 41,955.17 155.83 7,617.42 6,198.75 166,666.67 8,212,440.00 684,370.00 11,711.10 672,658,90 1 Includes prior year adjustment for tax increment calculation change 2 This transfer is done once a year only. 3 Interest is posted with investment maturities or dividend payments 4 Purchase of Rental property on Santa Rosa 5 Includes re -purchases and re -sales 6 Debt Service is due 10/1 and 4/1 of each year O g CI CJy_..A. 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'0 0, 0 00 A A CO N a,N' (A:;N1,.A; .4= o -0.i1J-A • toCS e a. 0 g. to coto A Ot N A tJ --.I ND Q IN.) n ? 0 0 0 0 0 ti m ng i00Z/000Z A ti 1n m 0 01n7 1 "�301 P. m w ° m 1 N =•. c O5 -cc,0) O G m d 0 d 1 n o o m • o ' m y c 0 0 0 ▪ _ ▪ O ° m 3 e) - o m OW3W 3O1d3Od31N1 1N3W12HVd3U 33NVNId 0 cn v m 7J Revenues Rental Dividends/Interest Total Revenues Expenses Professional -Accounting & Auditing S Professional -Consultants $ Tenant Improvements $ Repairs & Maintenance Building $ Repairs & Maintenance - Landscapin $ Utilities -Water $ Utilities-Gas/Electric $ Utilities -Trash $ Telephone $ Insurance $ Total Expenses June-00 Budget City of Palm Desert Parkview Office Complex June-00 0 Actual Variance Variance 66,500 $ 63,476 $ (3,024) 95.45% 1,250 $ 6,428 $ 5,178 514.21% 67,750 $ 69,903 $ 2,153 103.18% 5,800 $ 5,800 $ - 5,500 $ 6,214 $ (714) 3,700 $ - $ 3,700 9,100 $ 11,230 $ (2130) 1,079 $ - $ 1,079 250 $ 117 $ 133 6,000 $ 5,944 $ 56 450 $ 633 $ (183) 150 $ 173 $ (23) 521 $ - $ 521 $ 32,550 $ 100.00% 11299% 0.00% 123.41%. 0.00%' 46.80% 99.07% 140.72% 115.07% 0.00% YrD Budget Actual Variance Variance $ 787,000 $ 766,109 $ (20,891) 97.35% $ 15,000 $ 57,247 $ 42,247 381.65% $ 802,000 $ 823,356 $ 21,356 102.66% $ 69,600 $ 69,600 $ - 100.00% $ 66,000 $ 82,644 S (16,644) 125.22% $ 44,400 $ 3,472 $ 40,928 7.82% $ 109,200 $ 71,730 $ 37,470 65.69% $ 12948 $ $ 12,948 0.00% $ 3,000 $ 1,137 $ 1,863 37.90% $ 59,500 $ 52157 $ 7,343 87.66% $ 5,400 $ 8,004 S (2604) 148.22% $ 1,870 $ 1,562 $ 238 86.80% $ 6,250 $ - $ 6,250 0.00% 30,111 $ 2,439 9251°/ ..p .'�G $ 378,098 $ 290,305 $ 87,793 76.78% e cnis nmers N ' o - as,;- 35,m0:,.swi:tes9,774,S120?2;,,,� 113.ork -equipment Replacement Reserve $ 9,186 $ FitiWpieVa 3' 9,639 $ (453) 104.93% '533,0517 $i 109,149 3:A12575% $ 110,232 $ 106,024 $ 4,208 %.18% 26,014=:$ aW30i15M5AIZ„`A140_ 01531% :a- s•. 313.67(i13;$"✓"..'.427,02T::i$k113,357-ra3614%t Invest2O -invest Suite No. Parkview Office Complex Vacancy Rate Schedule by Suite June 2000 Tenant 73-710 Fred Waring Drive - Two (2) Story Building Square Feet 100 Hanover ( Options expires on December 31, 00) 2,560 102 Bergren 1,360 103 Multiple Sclerosis 488 104 Arthritis Foundation 960 106 Council Approved a Five Year Lease Agreement 928 with JMS Consulting 108 Senator Kelly ( Lease determined by election results) 785 112 Assemblyman Battin ( Lease determined by election res 1,406 114 Chamber of Commerce 1,478 118 Goodwill Industries 1,250 119 City/CVAG Conference Room 1,380 120 Golf Dimensions 1,750 200 CVAG 4,292 200A Council Approved a 1 year lease agreement with 841 University of California Riverside 201 Vacant 604 203 Accounting Services 480 205 Coachella Valley Economic Partnership 700 208 Desert Springs Investments 960 210 Wilson , Pesota & Pichardo 3,040 211 Alzheimer's Association 937 InveshVacancy Report Suite No. Parkview Office Complex Vacancy Rate Schedule by Suite June 2000 Tenant Square Feet 217 Mcmillan 775 220 CA. State Dept. of Agriculture 1,607 ( Agreed to a Five Year Lease Extension) 222 WMA Securities 2,981 Total square footage (2 story Building) 31,562 Vacancy Rate-2,373/31,562= 7.52% 73-720 Fred Waring Drive- One Story Building 100 State of California - Water Resources 15,233 102 State of California - Rehabilitation Department 4,396 Total Square Footage 19,629 Vacancy Rate-0.00% Overall Vacancy Rate for Both Buildings: Vacancy Rate-2.373/51.191= Occuvancv Rate - 48.818/51.191 4.64% 95.36°k InveshVacancv Report City of Palm Desert Parkview Office Complex Juty-00 July-00 tY % YTD YTD 0 % Budget Actual Variance Variance Budget Actual Variance Variance Revenues Rental $ 63,000 $ 67,089 $ 4,089 106.49% $ 63,000 $ 67,089 $ 4,089 106.49% Dividends/Interest $ 2,500 $ 6,666 $ 4,166 266.62% $ 2,500 $ 6,666 $ 4,166 266.62% Total Revenues $ 65,500 $ 73,755 $ 8,255 112.60% $ 65,500 $ 73,755 $ 8,255 112.60% Expenses Professional -Accounting & Auditing $ 5,800 $ 6,371 $ (571) 109.85% $ 5,800 $ 6,371 $ (571) 109.85% Professional- Consultants $ 6,500 $ 6,055 $ 445 93.15% $ 6,500 $ 6,055 $ 445 93.15% Tenant Improvements $ 2,500 $ - $ 2,500 0.00% $ 2,500 $ - $ 2,500 0.00% Repairs & Maintenance Building $ 9,100 $ 6,287 $ 2,813 69.09% $ 9,100 $ 6,287 $ 2,813 69.09% Repairs & Maintenance - Landscapi $ 2,300 $ - $ 2,300 0.00% $ 2,300 $ - $ 2,300 0.00% Utilities -Water $ 250 $ - $ 250 0.00% $ 250 $ - $ 250 0.00% Utilities-Gas/Electric $ 5,500 $ - $ 5,500 0 00% $ 5,500 $ - $ 5,500 0.00% Utilities -Trash $ 450 $ 1,267 $ (817) 281 44% $ 450 $ 1,267 $ (817) 281.44% Telephone $ 150 $ 150 $ 0 99.67% $ 150 $ 150 $ 0 99.67% Insurance $ 520 $ - $ 520 0.00% $ 520 $ - $ 520 0.00% Total Expenses $ 33,070 $ 20,129 $ 12,941 60.87% $ 33,070 $ 20,129 $ 12,941 60.87%1 (Operating Income $ 32,430 $ 53,626 $ 21,196 165.36% $ 32,430 $ 53,626 $ 21,196 165.36%! Equipment Replacement Reserve $ 9,639 $ 9,639 $ - 100.00% $ 9,639 $ 9,639 $ - 100 00% Whet Income $ 22,791 $ 43,987 $ 21,196 193.00% $ 22,791 $ 43,987 $ 21,196 193.00%1 Invesp2001-invest Suite No. Parkview Office Complex Vacancy Rate Schedule by Suite July 2000 Tenant Square Feet 217 Mcmillan 775 220 CA. State Dept. of Agriculture 1,607 ( Agreed to a Five Year Lease Extension) 222 WMA Securities 2,981 Total square footage (2 story Building) 31,562 Vacancy Rate-2,373/31,562= 7.52% 73-720 Fred Waring Drive- One Story Building 100 State of California - Water Resources 15,233 102 State of California - Rehabilitation Department 4,396 Total Square Footage 19,629 Vacancy Rate-0.00% Overall Vacancy Rate for Both Buildings: Vacancy Rate--2.373/51,191= 4.64% Occuvancv Rate - 48.818/51,191 95.36% Invest,Vacancy Report Suite No. Parkview Office Complex Vacancy Rate Schedule by Suite July 2000 Tenant 73-710 Fred Waring Drive - Two (2) Story Building Square Feet 100 Hanover ( Options expires on December 31, 00) 2,560 102 Bergren 1,360 103 Multiple Sclerosis 488 104 Arthritis Foundation 960 106 Council Approved a Five Year Lease Agreement 928 with JMS Consulting 108 Senator Kelly ( Lease determined by election results) 785 112 Assemblyman Battin ( Lease determined by election res 1,406 114 Chamber of Commerce 1,478 118 Goodwill Industries 1,250 119 City/CVAG Conference Room 1,380 120 Golf Dimensions 1,750 200 CVAG 4,292 200A Council Approved a 1 year lease agreement with 841 University of California Riverside 201 Vacant 604 203 Accounting Services 480 205 Coachella Valley Economic Partnership 700 208 Desert Springs Investments 960 210 Wilson , Pesota & Pichardo 3,040 211 Alzheimer's Association 937 Invest.Vacancy Report Revenues Rental Dividends/Interest Total Revenues City of Palm Desert Parkview Office Complex August-00 August-00 # % YTD YTD k % Budget Actual Variance Variance Budget Actual Variance Variance $ 63,000 $ 65,868 $ 2,868 104.55% $ 63,000 $ 132,957 $ 69,957 211.04% $ 2,500 $ 7,216 $ 4,716 288.63% $ 2,500 $ 13,881 $ 11,381 555 25% $ 65,500 $ 73,083 $ 7,583 111.58% $ 65,500 $ 146,838 $ 81,338 224.18% Expenses Prof essional-Accounting&Auditing $ 5,800 $ 6,371 $ (571) 109.85% $ 5,800 $ 6,371 $ (571) 109.85% Professional- Consultants $ 6,500 $ 5,500 $ 1,000 84.62% $ 6,500 $ 6,055 $ 445 93 15% Tenant Improvements $ 2,500 $ 2,160 $ 340 86.40% $ 2,500 $ - $ 2,500 0.00% Repairs & Maintenance Building $ 9,100 $ 12,136 $ (3,036) 133.36% $ 9,100 $ 6,287 $ 2,813 69.09% Repairs & Maintenance - Landscapi $ 2,300 $ - $ 2,300 0.00% $ 2,300 $ - $ 2,300 0.00% Utilities -Water $ 250 $ 98 $ 152 39.14% $ 250 $ - $ 250 0.00% Utilities-Gas/Electric $ 5,500 $ 7,703 $ (2,203) 140.06% $ 5,500 $ - $ 5,500 0.00% Utilities -Trash $ 450 $ - $ 450 0.00% $ 450 $ 1,267 $ (817) 281.44% Telephone $ 150 $ 120 $ 30 79.91% $ 150 $ 150 $ 0 99.67% Insurance $ 520 $ - $ 520 0.00% $ 520 $ - $ 520 0 00% Total Expenses $ 33,070 $ 34,088 $ (1,018) 103.08% $ 33,070 $ 20,129 $ 12,941 60.87% lOperating Income $ 32,430 $ 38,995 $ 6,565 120.24% $ 32,430 $ 126,709 $ 94,279 390-72°/_ Equipment Replacement Reserve $ 9,639 $ 9,639 $ - 100.00% $ 9,639 $ 9,639 $ - 100.00% WNetlncome $ 22,791 $ 29,356 $ 6,565 128.81% $ 22,791 $ 117,070 $ 94,279 513.67%I Invest;2001-invest Suite No. Parkview Office Complex Vacancy Rate Schedule by Suite August 2000 Tenant 73-710 Fred Waring Drive - Two (2) Story Building Square Feet 100 Hanover ( Options expires on December 31, 00) 2,560 102 Bergren 1,360 103 Multiple Sclerosis 488 104 Arthritis Foundation 960 106 Council Approved a Five Year Lease Agreement 928 with JMS Consulting 108 Senator Kelly ( Lease determined by election results) 785 112 Assemblyman Battin ( Lease determined by election res 1,406 114 Chamber of Commerce 1,478 118 Goodwill Industries 1,250 119 City/CVAG Conference Room 1,380 120 Golf Dimensions 1,750 200 CVAG 4,292 200A Council Approved a 1 year lease agreement with 841 University of California Riverside 201 Vacant 604 203 Accounting Services 480 205 Coachella Valley Economic Partnership 700 208 Desert Springs Investments 960 210 Wilson , Pesota & Pichardo 3,040 211 Alzheimer's Association 937 Invest;Vacancy Report Suite No. Parkview Office Complex Vacancy Rate Schedule by Suite August 2000 Tenant Square Feet 217 Mcmillan 775 220 CA. State Dept. of Agriculture 1,607 ( Agreed to a Five Year Lease Extension) 222 WMA Securities 2,981 Total square footage (2 story Building) 31,562 Vacancy Rate-2,373/31,562= 7.52% 73-720 Fred Waring Drive- One Story Building 100 State of California - Water Resources 15,233 102 State of California - Rehabilitation Department 4,396 Total Square Footage 19,629 Vacancy Rate-0.00% Overall Vacancy Rate for Both Buildings: Vacancy Rate--2,373/51,191= Occunancv Rate - 48.818/51.191 4.64% 95.36% Invest;Vacancy Report S Course & Ground Carts Golf Shop Range Food & Beverage Interest Income Total Revenues Revenue Payroll Proshop Cart Course & Ground Golf Operations General & Administration Food & Beverage Total Payroll Other Expenditures Perimeter Landscaping Proshop Proshop-COGS Cart Course & Ground -North Course Course & Ground -South Course Course & Ground -Desert Pallet-N Course & Ground -Desert Pallet-S Golf Operations General & Administra0on Range Food &Beverage Food & Beverage COGS Management Fee Financing/Lease City of Palm Desert Desert Willow Budget Vs Actual For the month of June 2000 Budgeted Actual Budgeted Actual June June $ Percentage Year to Year to $ Percentage 2000 2000 Variance Variance Date Date Variance Variance $ 154,420 $ 248,409 $ 93,989 16087°'U $ 5,045,370 $ 4,944,064 S (101,306) 97 99% $ 12,550 $ 31,755 $ 19,205 253 03% $ 290,552 $ 288,412 $ (2,140) 99.26% $ 23,450 $ 55,930 I 32,480 238.51% $ 615,689 $ 752,050 $ 136,361 122 15% $ 2,000 $ 577 $ (1,423) 28 85% $ 30,517 $ 15,614 $ (14,903) 51 16% $ 65,400 $ 97,469 $ 32,069 149 04% $ 709,891 $ 856,039 $ 146,148 120.59% $ 1,500 $ 4,193 $ 2,693 279 53% $ 27,886 $ 37,549 $ 9,663 134.65% $ 259.320 438 333 $ 179,013 . w . 169.03 % $ 6.719.905 $ 6,8„ 93.7„�,�, 2 173.823 102.59%I $ 7,641 $ 11,861 $ (4,220) 155 23% 5 114,612 $ 143,374 $ (28,762) 125 10% $ 18,933 $ 19,342 $ (409) 102 16% $ 253,537 $ 204,283 $ 49,254 80 57% $ 109,220 $ 97,917 $ 11,303 89 65% $ 1,274,950 $ 1,317.639 $ (42,689) 10335% $ 18,258 $ 17,792 $ 466 97 45% $ 238,109 $ 283,418 $ (45,309) 119.03% $ 32,245 $ 33,604 $ (1,359) 10421% $ 334,213 I 316,274 $ 17,939 9463% $ 42,472 $ 68,481 $ (26,009) 161 24% $ 392,336 $ 443,878 $ (51,542) 113 14% $ 228 769 $ 248,997 6 (20 228)1 108.84 % S 2 607 757 $ 2.708.866 $ (101 1091 103.88% $ 2,652 $ - $ 2,652 0 00% $ 31,814 $ - $ 31,814 0 00% $ 1,050 5 2,921 $ (1,871) 278 19% 5 46,607 $ 80,160 $ (33,553) 171.99% $ 12,898 $ 41,533 $ (28,635) 322 01% 5 347,210 S 439,045 $ (91,835) 126.45% $ 22,296 $ (107,339) $ 129,635-481,4314 $ 402,949 $ 268,250 $ 134,699 66.57% $ 49,045 $ 53,104 $ (4,059) 108 28% $ 642,741 1 649,033 $ (6,292) 100 98% $ 48,200 $ 76,811 $ (28,611) 1593614 $ 675,614 $ 673,087 $ 2,527 99 63% $ 2,000 $ 1,523 $ 477 76.15% $ 31,600 $ 29,492 $ 2,108 93 33% $ 1,500 $ 2,116 $ (616) 1410714 $ 25,600 $ 25,233 $ 367 985714 $ 700 $ 2,122 $ (1,422) 303 14% $ 42,210 $ 34,186 $ 8,024 8099% $ 39,057 $ 91,896 $ (52,839) 235 29% $ 677,364 $ 748,397 $ (71,033) 110.49% $ 250 $ 13 $ 237 5 20% $ 26,162 $ 17,161 $ 9,001 65.60% $ 6,225 $ 117,475 $ (111,250) 1887 15% $ 106,811 $ 283,089 S (176,278) 2650414 $ 22,080 $ 31659 $ (9,579) 143 38% $ 251,508 $ 306,459 $ (54,951) 121.85% $ 25,000 $ 83,136 '$ (58,136) 332.54% $ 300,000 5 356,435 $ (56,435) 118 81% $ 8,011 $ 21,412 $ (13,401) 26728% $ 102,569 $ 85,412 $ 17,157 832714 Total Other Expenditures S 240.964 David Leadbetter Academy Learning Center Revenues Reimbursements to David Leadbetter Other Expenditures 418.382 $ (177.418) 173.63 % $ 3,710.759 107.67% $ 15,000 $ 30,348 $ 15,348 202 32% $ 396,968 $ 372,321 $ (24,647) 93 79% $ (12,750) $ (26,045) $ (13,295) 204 27% $ (337,672) $ (316,060) $ 21,612 936014 $ (100) $ (1,377) $ (1,277) 137700% $ (7,950) $ (16,524) $ (8,574) 207 85% Learning Center Income (Loss) $ 2.150 $ 2,926 $ 776 136 09% $ 51,346 $ 39,737 $ (11,609) 77.39% Operating Income (Loss) $ (208,263) $ (226,120) $ (17,857) 108 57% $ 452,735 $ 229,160 $ (223,575) 50 62% Equipment Reserve Replacement $ 40,822 $ 40,822 $ 100 00% $ 489,859 $ 489,864 $ 5 100.00%u Vet Loss) S (249.0851 S 12669421 S (17.8571 xi4 107.17% (37.124) $ (260.7041 S (223 801 702,25%1 (Snapshot of Colt Rounds Budgeted (mal Actual (mol Variance Variance% Budgeted (vtdl Actual (vtdl Variance Variance% Resident 1528 629 (899) 41% 24,940 19,315 (5,625) 77% Non Resident 2,221 5,596 3,375 252% 42,418 50,369 7951 119% Other 102 31 (71) 30% 1,036 438 ' (598) 42% Comnlimentary 149 334 185 224% 3.940 4.671 ' 731 119% Total 4,000 6,590 2,590 165 % 72,334 74,793 2,459 103% Dw2000,Financial Statement Page 1 \)((\§/ ®§/-{(` k Q % § 4.•2 iso o to ; ` § | | ] ; ! GI / 0 )\J ! ({V,/�/!) ) to 2°]�\ 2 );k\}))f 2 uua{!7= a 00<0 ;! `22/Re /k($(� (cci CO \ k� <«_ § it ° �� \< ca{ {� %{ ƒ` oin 11: 21 )� `! CO r 0 i* L.1Z § _ )/! f`$ ! / )` ' )" [ > )! / en / t. t. el eeeee /!y )! .494969.69 /! ){ ! (;;i S 3%3273 337733 e °;l.Bll;E,:: .7.-87738 69490.491. §3-Soo ! (7.9 E!\!;!§ .!!,>::.1;»; t§\)! !!§;\ 9 !}(-'811 \ .696969.494969...)01 §wi:;;l;E!!I E:i_ ) / 0]§)!)00 Z} #f|.(mk) /!0QL)L) !)!! eee ;;; \{( !t( 777. }\ Variance Variance % egge Qq; Ft 28- ):�;u= E R(/E §ff®!! Operating Income (Loss) Actual June. 99 Actual June. 00 Snapshot of Golf Rounds &!`- ttel 6 | a C O se tote se se se se se se se se 6R O cotcN r1 -�-. 00 VI Vi N W 7 V�1 r -. 0 0 0 0 0 O 0 0 O M N N 7 N N N en M 6R s0 se se se se se se se se se se b� N 10 V 0 VV) p01 VDN N aN cn 7 co N N V1 7 O 0\ 0\ 01 10 V) N M ernM r 'D Vt N O N 4 b 10 VD N N N N e col V) M N N M B° 6R SR 6R 6R 6R 6R s° 6° 6R SR SR in 0 OM On h O 0— 0000 DOO— b M N N N EIE'0 b b b N a p N t CO -0011 0011 0000 ~-- CC00 NCO N N --, e O N oO 7 M 1D N 10 ,4 N N M M N M M M M M f .-I 60 6R S 6E se SR se se 00 6e 6R �° M O Vl O .-. M 01 01 CO M 1D N •D Cr) h ei 10 cc)O N V1 bOb MG ti -4 M t+1NNNNe ti N 4i N O 4 N 0 in 00 00 GO N M en N 0 N 0\ Va in 0o M co 10 10 O .n .+ N 10 O0O0 0011 LO 7 C. 00 .et •D ctn m b en enN M 7 --. M V7 M ) V1 V1 et v.82 > a r 0 y 0 Q `" fir. Current F/Y Total of Actual To Budget ner Month : 0 O Be Be SR Se SR N 00 s° 00 Be e se N NN00O 'ai t00e�00 fel N .M-i O 10 O\ 01 N C 0T M N 0 0 0 en 00 0 0 en� co 01 7 V) co eny� 0 EC 10 0 in-� N O 7 00 Vim-. 7 V can CVb4-7 Go 'V O .-I R O O O o 0 0 O O 80 p p 07 N re.h N 4\ O M C .-+ a s co el N al W 0,0 7 0 VD V e.0 N N Vin M O 00 01 10 7 03 '0 M `O 10 01 M N M [T M V1 V) tin 7 M .4 a i 0 0 .?¢v�OZO lu.:5 Current F/Y Total Dw2000;Rounds Analysis-FC eeseeeeseeeeee - 01 00 r yO OW m b O. vri VNV P h vOT1. N 01 m d O N eV N N N N ^ P P P ^ Ow O? Vl P V1 O m o Nl d C d d NN lOO W O O N N N N v N1 M 2 M m W N 'O N1 C ee'0 Q1 m m N N - N 1O O O- ti N N N cNe1 een O N b-^ y1p m o P o OP NO'0v1a NoN01 m vl P^� b N lV en e�1 d V 0 Om o 0 p e P^ N g mP N N V1 h P Q N �0 h e 1 N m T fle..ONONer40N0rv'g rqm N d 1N O O- d n N N en vd1 0 vmi O 1g 1p m N K d _A E E Z 2 t ;a'�Xo°z°o ut N ti GO O pr NI S en m 0 yF 0 0 .18 4, 08 a' U, 7 Q'i d L 9 5m 0 U • c4 pU au bt ° a/ ogo U gg 86.0 F 0 Q 0 U U ex N'0(4p0eeerysewee ^ 1O A O .Nr C Om P rv. m vt N l- F b 10 °° d N m 3 '4'. a N W N N r i C c VNi 8 r Vi g H m N 0 T W N N m N N N 0 ee PR yNON-8ER se PR '0 e ppe 'aryrye se TN-N ^ 0°1N N M m O m O b O o m o(6 N m H -4 00 N H • o a ,N. 72• - Q 9 N N N N T-^- N F O z 0'NbNONWam'- m 'O- N E U g N N T T N T m T m Faa 0 u Heesee e6eseee eew e 8 em-1 '0 m 00 N n em0l 1� W 01 N r en — 01 N d d pp P pW 1' V1 10 yO W d d in rn Vt ' d Om d n b P r n< h< N e1O 1 N 1- N V1 d N ^ N .,g E, `v LxcX8z°2.u` n4 .Nr 0 C_ 00 O 0 W b N 0 0 0 0 0 0 0 0 0 0 w y p qt Spe be be BQ BQ Be Be Be Be Se Se Se 01 O .00 Ch M. e. V N 0 �. N CT to In in VD b VD VD n V Se Be Be Be ee Be Be BE Se Be Be Be 'O a0 v1 en en CT 1/-1 b r -. r en co CA V r N en M r O H O - N N to vt N V b m V N p 0 y U M 00 cn 00 r 01 N N 00 ten enO ,d V N V VDn n N 4- 01 a 0 0 ~ : I' w a 0 a q O p Ca41; "O �C7U p,O 0 6e 69. 6R Be Be Se Se 6e 6e BSR 'i7 N V cn .--. CO -. en r 00 00 .-. 'a O a. b V1 V oo to vi ni N—. -. O v.; V r 00 V1 b N N b V1 b r CO Del 0 a z it Q in en rr cnIC-0'O V V v N �-+ N -. -+ N N N e. N O z 00 SR Be Be Be Be Se Se Be Be He b CO 0 N CO V cv r- r in v1 0 0 O N Vt CO ut n V v1 O C O 10 6 cn N cc; en N V R N O 'd t`n n to V cn V cn N -. Se cG CO '. n D\ CO '. N 0 V1 b n .. C T .-. to kn 00 cen N -e. ti 1b0 ten Vbi M w ell p 'O .-. .-. .. ...-..-. v x `) N w '. 001 OP1 b r co .M. b to V N N V1 V 0 00 (n 01 p O e V r1 N to V to N N Fa. .. Ey EE zt= zuuutt a G o u c y m a 01 0 �¢tnozA ;u. h 7 00 0\ Current F/Y Tota 29,857 Be Se Be Be Se SR S Be Be Se SR SR be 0 O O� b 00 h O .r. W N CO cen V nr'NNN' NOS Vco Na ro en N ON 0000 O en in .N. 00 0\ en ,-I N CI .. v N f N .--i .--i v 01 N ell 0 - v.�.�� N 7 Qg g�$ Q b .0N o O O g CVO N �jIn- O y .. N V V V V V1 V N N o = * N N 00 OO 00 lb0 [N CO N VI N co 0 en id b N1 V N N V1 V O CO en 01 07 F¢ cV m N to V c.i N N C 0 O N v T EttQ� ctsE T 7 .' O y G v N p, N Current F/Y Total 0 0 0 Mountain View O C ,a w beneweo0N00fl\ '0 M VV 01NTP W Or 0�0�p b TON r Nr NM In tI ry Q a 4n2P W NOO'OP N b tegg to C O O r C 'O b N '.1 N m N O - N N m INn n N m .. O^ N m„ mtdy N a N N b N N r b O, % m r O^ b O N N N N^ M mW b d N m N O O Nm .ri'SO82w74804?00 d b r O N V b m c"S P000l .2, 6 v1 N m d N r m P P N N en GO N 00 0, 00 W a P 1 O -ES EE u O. S . . N cece**cece*cecete*Ile e' �v 1,P8��8SNN8g3I N d a b O m m N O C P r N V > a Ot to m b N m m d O tat O > gt N N .b-. C T d d< N S r .n g N^ P m vl ^ “ b b r d sa 0 8 3 p8pr o8o-00�0p$P mo<c.m b N N W S b 0 `D P m r0n O P W- m m b b N b m N% b N N N m N m N P N N b d O Nr^N V1 a P N w ce 0 00 cerg 00 N 0'0- 0 a Nn00O(MNONM1cv N- W 0 P tD N N b N O N n N m N m N N N d N ‘51 G C m O N O ,Q P .4 C O b t0 y GN N d0 N oe '0 b O nn G b .N+ �'� w - N N N m^- Oa i H m 0 z y ta C� "' b en n r r m'' d O l7 d_ ta N '.N N N- N -°a¢ 0 z y Q v P N 00 me to ww***f l0�..11S4 b N N-. b N v01 W N?^ VI ry N .+ N W NN N 00 O W tO V N O1 N b C..11 y0� O- d' g n oVl g4i 9 P N tv v v m P N O P b 2 O. b. Nd) W N^ IOh Q y d N N N b d d d N v1 P r L O tl 9j H a0 i P- rrn $. P tV O s N b W a N W E 9 a P ¢ a ¢ 4 0 K 8 w E E Err y g -0.¢1iiOZtii¢? 3 u Desert Willow Breakdown of Rounds per point of sale system COMBINED - Mountain View & Firecliff Golf Courses Resident 629 $ 21,525 $ 34.22 9.54% Non -Resident 5,596 252,193 $ 45.07 84.92% Other 31 310 $ 10.00 0.47% Complimentary 334 575 $ 1.72 5.07% Desert Willow Totals 6,590 $ 274,603 $ 41.67 100.00% Page 11 Dw2000;POS AVG RD Desert Willow Breakdown of Rounds per point of sale system FIRECLIFF COURSE- JUNE 2000 Description Resident Rounds Resident Fee- Weekend Resident Fee -Weekday Resident Fee -Twilight No. Of Revenue Avg. Per Pet to Rounds Per POS Round Total 106 $ 3,840 $ 36.23 2.88% 125 $ 4,385 $ 35.08 3.40% 47 $ 1,175 $ 25.00 1.28% Total Resident Rounds 278 $ Non Resident Rounds 9,400 $ 33.81 7.56% Wholesale - Replay - $ (90) $ - 0.00% Posted Weekend 323 $ 22,040 $ 68.24 8.78% Posted Weekday 288 $ 15,072 $ 52.33 7.83% Posted Replay 192 $ 5,760 $ 30.00 5.22% Passbook- Weekday 379 $ 15,160 $ 40.00 10.31% Passbook - Weekend 113 $ 6,095 $ 53.94 3.07% IROC Member Guest- (wkdy) 1 $ 55 $ 55.00 0.03% IROC Member- (WKDY) 2 $ 99 $ 49.50 0.05% IROC Des. PRTY Wkdy 4 $ 145 $ 36.25 0.11% IROC Designated Party WKND 1 $ 35 $ 35.00 0.03% IROC Member Guest Replay 40 $ 1,400 $ 35.00 1.09% Wholesale Weekend 168 $ 8,400 $ 50.00 4.57% Wholesale Weekday 81 $ 2,178 $ 26.89 2.20% PS Golfer - Weekday 10 $ 400 $ 40.00 0.27% PS Golfer - Weekend 8 $ 320 $ 40.00 0.22% Twilight 242 $ 9,680 $ 40.00 6.58% Charity Event 1 $ 30 $ 30.00 0.03% Fee Special Event Variable 1,258 $ 55,163 $ 43.85 34.21% Total Non Resident Rounds Other Rounds Junior Walking Total Other Rouunds Complimentary Rounds 3,111 $ 141,942 $ 45.63 84.61% 27 $ 270.00 $ 10.00 0.73% 27 $ 270.00 $ 10.00 0.73% VIP 48 $ - $ - 1.31% PGA Member 73 $ 550.00 $ 7.53 1.99% COD/PDHS 90 $ - $ - 2.45% Donation 20 $ - $ - 0.54% Employee 30 $ - $ - 0.82% Total Complimentary Rounds 261 $ 550.00 $ 2.11 7.10% Total Rounds (FireCliff) 3,677 $ 152,162 $ 41.38 100.00% Page 12 Dw2000;POS AVG RD Desert Willow Breakdown of Rounds per point of sale system MOUNTAINVIEW COURSE- JUNE 2000 Description Resident Rounds Resident Fee- Weekend Resident Fee -Weekday Resident Twilight Total Resident Non Resident Rounds Posted Fee - Weekend Posted Fee - Weekday IROC- Mbr. Guest (WKND) IROC- Mbr. Guest - (9 hole) IROC- Mbr. - (9 hole) IROC-Designated Party - (9 hole) IROC- Mbr. Guest Weekday IROC- Des. Party Twilight IROC - Member Weekend IROC - Member Weekday Wholesale Weekend Wholesale Weekday Twilight Fee Passbook - Weekday Passbook - Weekend PS Golfer - Weekend PS Golfer - Weekday Wholesale - Replay Fee Charity Event Fee Special Event Variable Total Non Resident Rounds Other Rounds Junior Walking Total Other Rounds Complimentary Rounds No. Of Revenue Avg. Per Pct to Rounds Per POS Round Total 103 $ 226 $ 22 $ 3,665 $ 35.58 3.54% 7,910 $ 35.00 7.76% 550 $ 25.00 0.76% 351 $ 12,125 $ 34.54 12.05% 181 $ 12,446 $ 68.76 6.21% 231 $ 12,507 $ 54.14 7.93% 138 $ 4,830 $ 35.00 4.74% 16 $ 560 $ 35.00 0.55% 11 $ 385 $ 35.00 0.38% 14 $ 490 $ 35.00 0.48% 180 $ 4,950 $ 27.50 6.18% 1 $ 40 $ 40.00 0.03% 14 $ 784 $ 56.00 0.48% 25 $ 1,100 $ 44,00 0.86% 143 $ 6,846 $ 47.87 4.91% 80 $ 2,400 $ 30.00 2.75% 148 $ 5,920 $ 40.00 5.08% 306 $ 12,240 $ 40.00 10.50% 89 $ 4,580 $ 51.46 3.06% 1 $ 40 $ 40.00 0.03% 5 $ 200 $ 40.00 0.17% 2 $ 50 $ 25.00 0.07% 50 $ 1,500 $ 30.00 1.72% 850 $ 38,383 $ 45.16 29.18% 2,485 $ 110,251 $ 44.37 85.31% 4 $ 40 $ 10.00 0.14% 4 $ 40 $ 10.00 0.14% VIP 35 $ $ 1.20% PGA Member 8 $ 25 $ 3.13 0.27% Donation 24 $ - $ - 0.82% Employee 6 $ - $ - 0.21% Total Complimentary Rounds 73 $ 25 $ 0.34 2.51% Total Rounds (Mountainview) 2,913 $ 122,441 $ 42.03 100% Page 13 Dw2000;POS AVG RD City of Palm Desert Desert Willow Cash Reserve Analysis for the month of June 2000 Cash Reserve Analysis I Required Reserve 'Cash on Hand (Variance- Favorable ( Unfavorable) One Month I $ 500,000.00 I $ 1,287,376.91 I $ 787,376.91 Page 14 Revenue Course & Ground Carts Golf Shop Range Food & Beverage Interest Income I Total Revenues City of Palm Desert Desert Willow Budget Vs Actual For the month of July 2000 Budgeted Actual July July $ Percentage 2000 2000 Variance Variance $ 124.976 $ 97,816 $ (27.160) 78.27% $ 16.788 $ 16,078 $ (710) 95.77% $ 31,072 $ 31,081 $ 9 100.03% $ 2,720 $ 519 $ (2.201) 19.08% $ 63.650 $ 51,756 $ (11.894) 81.31% $ 1,500 $ 4,247 $ 2.747 283.13% $ 240.706 $ . 201.497 $ (39.2091 83.71% ...„. � :« Payroll Proshop $ 8A85 $ 10,483 $ (1.998) 123.55% Cart $ 14,233 $ 18,745 $ (4.512) 131.70% Course & Ground $ 111.819 $ 103,589 $ 8.230 92.64% Golf Operations $ 15.682 $ 18,822 $ (3,140) 120.02% General & Administration $ 36,717 $ 34.217 $ 2.500 93.19% Desert Willow Golf Academy $ 4,191 $ $ 4.191 0.00% Food & Beverage $ 37.350 $ 59.550 $ (22.200) 159.44% I Total Payroll $ 228.477 $ 245.406 $ (16.9291 107.41% Other Expenditures Perimeter Landscaping $ 1,208 $ - $ 1,208 0.00% Proshop $ 1.446 $ 4,384 $ (2.938) 303.18% Proshop-COGS $ 14.960 $ 18,406 $ (3.446) 123.03% Cart $ 7.900 $ 11.133 $ (3.233) 140.92% Course & Ground -North Course $ 65.102 $ 52,642 $ 12.460 80.86% Course & Ground -South Course $ 59.677 $ 59.136 $ 541 99.09% Course & Ground -Desert Pallet-N $ 2.400 $ 1,421 $ 979 59.21% Course & Ground -Desert Pallet-S $ 2.250 $ 1,362 $ 888 60.53% Golf Operations $ 1.621 $ 5,177 $ (3.556) 319.37% General & Administration $ 57.267 $ 51,595 $ 5.672 90.10% Range $ 350 $ - $ 350 0.00% Food & Beverage $ 6.770 $ 25,430 $ (18.660) 375.63% Food & Beverage COGS $ 20.317 $ 20,620 $ (303) 101.49% Management Fee $ 25.000 $ 25,000 $ - 100 00% Financing/Lease $ 19.534 $ 18,999 $ 535 97.26% !Total Other Expenditures 285.802 $ 295.305 $ (9,503 103.33% d. - Desert Willow Golf Academy Desert Willow Golf Academy $ 6500 $ 1,200 $ (5.300) 18.46% COGS - Merchandise $ (1.800) $ - $ 1.800 0.00% Other Expenditures $ (1.425) $ (7,494) $ (6.069) 525.89% Learning Center Income (Loss) . $ 3.275 $ (6.294) $ (9.569)-192.18% Operating Income (Loss) $ (270,298) $ (345,508) $ (75.210) 127.82% Equipment Resen a Replacement $ 40.822 $ 40,822 $ 100.00% Net Income (Loss) $ (311.120) $ (386.3300 $ (75s2101 124.17% Snapshot of Golf Rounds Resident Non Resident Other Complimentary Budgeted (mo Actual (mol Variance Variance % 788 2.111 141 368 552 2,405 58 177 (236) 294 (83) (191) 70% 114% 41% 48% Total Dw2001 .Financial Statement 3,408 3,192 (216) 94% Page 1 ;2 0 /(/�(.CO LO k ei 0 44§ Pm ) �§ |m ] t. j / ))k 2 je\\k/!) !!;+)±7 3 §)))7§)) /00 - 0 /,;3lEla 0 _ § § ■ 1 3 A // 0 E $! / ! ) City of Palm Desert Desert Willow Two (2) Year Comparison ACTUAL to ACTUAL Course & Ground Carts Golf Shop Range Food & Beverage Interest Income Total Revenues Revenue Payroll Proshop Cart Course & Ground Golf Operations General & Administration Desert Willow Golf Academy Food & Beverage rd Total Payroll Month of Month of $ Percentage Jul-00 Jul-99 Variance Variance 97,816 $ 16,078 $ 31,081 $ 519 $ 51,756 $ 4,247 $ 201,497 $ 10,483 $ 18,745 $ 103,589 $ 18,822 $ 34,217 $ - $ 59,550 $ $ 245�406 $ 125,407 $ (27,591) 78.00% 6,145 $ 9,933 261.64% 19,395 $ 11,686 I6025% 255 $ 264 203 53% 17,483 $ 34,273 296.04% 4,784 $ (537) 88.78% 173.469 $ 28,028 116 16°%1 7,755 $ 2,728 135.18% 13,538 $ 5,207 13846% 89,456 $ 14,133 115 80% 20,580 $ (1,758) 91 46% 25,845 $ 8,372 132.39% - $ - 000% 10,357 $ 49,193 574.97% 167,531 $ 77,875 146.48%I Other Expenditures Perimeter Landscaping Proshop Proshop-COGS Cart Course & Ground Golf Operations General & Administration Range Food & Beverage Food & Beverage COGS Management Fee Financing/Lease - $ 4,384 $ 18,406 $ 11,133 $ 114,561 $ 5,177 $ 51,595 $ - $ 25,430 $ 20,620 $ 25,000 $ 18,999 $ Total Other Expenditures $ 295,305 S David Leadbetler Academy Learning Center Revenues Learning Center Expenditures Otther Expenditures Learning Center Income (Loss) Operating Income (Loss) Equipment Replacement Reserve ed Net Income Loss par (Snapshot of Golf Rounds 1,200 $ - $ - 4DIV/01 2,235 $ 2,149 196.15% 12,867 $ 5,539 143.05% 15,756 $ (4,623) 70.66% 83,434 $ 31,127 13731% 264 $ 4,913 1960.98% 47,161 $ 4,434 109.40% 107 $ (107) 0.00% 3,689 $ 21,741 689.35% 8,028 $ 12,592 256.85% 25,000 $ - 100.00% 6,475 $ 12,524 293.42% 205,016 $ 90289 144.04%1 mil I 6,402 $ (5,202) 1874% - $ (5,442) $ 5,442 0 00% (7,494) $ (1,377) $ (6,117) 54423% (6,294) S (417) $ (5,877) 1509.35% $ (345,508) $ (199,495) $ (146.013) 173.19% $ 40,822 $ 30,565 $ 10,257 133 56% $ (386,330) $ (230,060) $ (156.270) 16793041 mmuwnu,umwe,bmwnmannne,, Add! In I IIIIIIIILing ! I iAwinu1a,uim Actual July. 00 Actual July. 99 Variance Variance % Resident 552 642 (90) 86% Non Resident - 2,405 2,400 5 100% Other 58 62 (4) 94% Complimentary 177 281 (104) 63% Total 3,192 3,385 (193) 94% Page 3 Dw200 1;2yr Companson 0 8 cz s 8 1 0 G 1 k , !y a I.0 } , ° > f_ ' 0 �� > ` ` .0 « 2 e0 t 3 it % ? ia a •« ° ; & " « f zto of. 4 >A" ; O \ « at tty \ \ \ \ tit K rot at a pot 00 ! e \ } - \ g41 ! $ p, _m » \ ± Ct $« 0 ON 1\ 0 0 en Mountain View ;o tit at, -64 be 7 NI 01 30 en j & el en >4 ) ) ± N tR utte \\ )) ( f on in Current F/Y Total be }\ oi k co DO ; ; co co on VI ! o a » 30 -) • un 1 \ ! \ Current F/Y Total 5. } CO n I 3 Desert Willow Breakdown of Rounds per point of sale system Desert Willow - Combined Analysis -July 2000 Resident 552 $ 17,460 $ 31.63 17.29% Non -Resident 2,405 $ 94,685 $ 39.37 75.34% Other 58 $ 600 $ 10.34 1.82% Complimentary 177 $ 675 $ 3.81 5.55% Desert Willow Totals 3,192 $ 113,420 $ 35.53 100.00% Page 9 Dw2001;POS AVG RD Desert Willow Breakdown of Rounds per point of sale system MOUNTAINVIEW COURSE- JULY 2000 Description Resident Rounds Resident Fee- Weekend Resident Fee -Weekday Resident Twilight Total Resident Non Resident No. Of Revenue Avg. Per Pct to Rounds Per POS Round Total 86 $ 3,010 $ 35.00 5.90% 58 $ 2,030 $ 35.00 3.98% 69 $ 1,725 $ 25.00 4.74% 213 $ 6,765 $ 31.76 14.62% Posted Weekend 96 $ 6,454 $ 67.23 6.59% Posted Weekday 63 $ 3,432 $ 54.48 4.32% 9 Hole Weekday 1 $ 35 $ 35.00 0.07% IROC MBR Guest -Weekday 189 $ 5,198 $ 27.50 12.97% IROC MBR Guest -Weekend 210 $ 7,350 $ 35.00 14.41% IROC MBR Guest- 9 -Weekday 1 $ 35 $ 35.00 0.07% IROC MBR Guest- 9 -Weekend 2 $ 70 $ 35.00 0.14% IROC MBR wknd 9 $ 504 $ 56.00 0.62% IROC MBR WKDY 12 $ 528 $ 44.00 0.82% IROC Des. PRTY Wkdy 2 $ 110 $ 55.00 0.14% IROC Des. PRTY-9-Weekday 7 $ 245 $ 35.00 0.48% IROC Des. PRTY-9-Weekend 17 $ 595 $ 35.00 1.17% Wholesale Weekend 23 $ 1,150 $ 50.00 1.58% Wholesale Weekday 30 $ 900 $ 30.00 2.06% Wholesale Replay 1 $ 25 $ 25.00 0.07% Twilight 198 $ 7,920 $ 40.00 13.59% Passbook Twilight Fee 1 $ 40 $ 40.00 0.07% Passbook Weekday 39 $ 1,560 $ 40.00 2.68% Passbook Weekend 77 $ 4,175 $ 54.22 5.28% P.S. Golfer Fee (wkdy) 1 $ 40 $ 40.00 0.07% P.S. Golfer Fee (wknd) 4 $ 160 $ 40.00 0.27% Fee Special Event Variable 234 $ 8,790 $ 37.56 16.06% Total Non Resident Rounds 1,217 $ 49,316 $ 40.52 83.53%, Other Rounds Junior Walking 2 $ 20 $ 10.00 0.14% Total Other 2 $ 20 $ 10.00 0.14% Complimentary VIP 6 $ - $ - 0.41% PGA Member 6 $ 50 $ 8.33 0.41% Employee 13 $ $ - 0.89% Total Complimentary 25 $ 50 $ 2.00 1.72%' Total Round (Mountainview) 1,457 $ 56,151 $ 38.54 100% Page 10 Dw2001;POS AVG RD Desert Willow Breakdown of Rounds per point of sale system FIRECLIFF COURSE- JULY 2000 Description Resident Rounds Resident Fee- Weekend Resident Fee -Weekday Resident Twilight Total Resident Non Resident No. Of Revenue Avg. Per Pct to Rounds Per POS Round Total 108 $ 3,780 $ 35.00 6.22% 114 $ 3,990 $ 35.00 6.57% 117 $ 2,925 $ 25.00 6.74% 339 $ 10,695 $ 31.55 19.54% Posted Weekend 134 $ 9,009 $ 67.23 7.72% Posted Weekday 88 $ 4,631 $ 52.63 5.07% Advanced.Fee-Weekend (8) $ (1,440) $ 180.00 -0.46% IROC MBR Guest -Weekend 2 $ 112 $ 56.00 0.12% IROC MBR WKDY 2 $ 88 $ 44.00 0.12% IROC Des. PRTY Wknd 1 $ 56 $ 56.00 0.06% IROC Des. PRTY - 9 Weekend 63 $ 2,205 $ 35.00 3.63% IROC MBR-Weekend 2 $ 112 $ 56.00 0.12% IROC MBR Guest- 9 Weekday 4 $ 140 $ 35.00 0.23% IROC MBR Guest - 9 Weekend 3 $ 105 $ 35.00 0.17% Wholesale Weekend 48 $ 2,244 $ 46.75 2.77% Wholesale Weekday 25 $ 454 $ 18.16 1.44% Twilight 371 $ 14,840 $ 40.00 21.38% Posted Replay 14 $ 420 $ 30.00 0.81% Passbook Weekday 109 $ 4,360 $ 40.00 6.28% Passbook Weekend 56 $ 2,840 $ 50.71 3.23% P.S. Golfer Fee (wkdy) 4 $ 160 $ 40.00 0.23% Passbook Twilight Fee 6 $ 240 $ 40.00 0.35% Fee Special Event Variable 264 $ 4,793 $ 18.16 15.22% Total Non Resident Rounds Other Rounds Junior Walking Chanty Event Total Other Complimentary VIP PGA Member Donation Employee Employee Guest Total Complimentary Total Round (FireCliff) 1,188 $ 45,369 $ 38.19 68.47% 55 550 $ 10.00 3.17% 1 30 $ 30.00 0.06% 56 580 $ 10.36 3.23%: 61 0 $ - 3.52% 52 625 $ 12.02 3.00% 6 0 $ - 0.35% 31 0 $ - 1.79% 2 0 $ - 0.12% 152 625 $ 4.11 8.76% 1,735 57,269 $ 33.01 100.00% Dw2001,POS AVG RD Page 11 City of Palm Desert Desert Willow Cash Reserve Analysis for the month of July 2000 Cash Reserve Analysis (Required Reserve ICash on Hand I Variance- Favorable ( Unfavorable) One Month I $ 500,000.00 I $ 981,767.88 I $ 481,767.88 Page 12 Food & Beverage Revenues Total Revenues PalmDesert Recreation Facilities Corporation Income Statement Jul-00 Jul-00 # % Budget Actual Variance Variance $63,650 $51,756 ($11,894) 81.31% $63,650 $51,756 ($11,894) 81.31% Salaries $37,350 $59,550 ($22,200) 159.44% Cost of Goods Sold-F&B $20,317 $20,620 ($303) 101.49% Food & Beverage Expense $6,770 $25,430 ($18,660) 375.63% Total Expenses $64,437 $105,600 ($41,163) 163.88% Net Income (Loss) ($787) ($53,844) $53,057 6841.68% Note: The above revenues and expenditures are also included in the Desert Willow analysis. Dw2001;PDRFC Budget Page 1 September 20, 2000 - REGULAR INVESTMENT & FINANCE COMMITTEE MEETING VI. NEW BUSINESS F. DESERT WILLOW GOLF RESORT FINANCIAL INFORMATION FOR JUNE/JULY 2000 Rec: Review and file report. (JULY 2000 REPORT TO BE DISTRIBUTED AT MEETING) G:\Fnance\Deb Bradley kwpdocs11NVSTCOMWsert-VIt.wpd September 20, 2000 - REGULAR INVESTMENT & FINANCE COMMITTEE MEETING VI. NEW BUSINESS G. PALM DESERT RECREATION FACILITIES CORPORATION INCOME ANALYSIS FOR JUNE/JULY 2000 Rec: Review and file report. (JULY 2000 REPORT TO BE DISTRIBUTED AT MEETING) G \Finance\Deb Bradley \wpdccs\Invstcomynsert-Vlg wpd Food & Beverage Revenues Total Revenues Salaries Cost of Goods Sold-F&B Food & Beverage Expense Total Expenses Net Income (Loss) PalmDesert Recreation Facilities Corporation Income Statement Jun-00 Budget $65,400 Jun-00 # % Actual Variance Variance $97,469 $32,069 149.04% $65,400 $97,469 $32,069 149.04% $42,472 $68,481 ($26,009) 161.24% $22,080 $31,659 ($9,579) 143.38% $6,225 $117,475 X ($111,250) 1887.15% $70,777 $217,615 ($146,838) 307.47% ($5,377) ($120,146) $114,769 2234.44% Note: The above revenues and expenditures are also included in the Desert Willow analysis. X- The Food 8s Beverage Expense line item includes the annual rent due of $ 96,000.00. With out the rent the actual Expenses for this line item is $21,475.00 Dw2000;PDRFC Budget Page 1 Food & Beverage Revenues Total Revenues PalmDesert Recreation Facilities Corporation Income Statement Jul-00 Jul-00 # % Budget Actual Variance Variance $63,650 $51,756 ($11,894) 81.31% $63,650 $51,756 ($11,894) 81.31% Salaries $37,350 $59,550 ($22,200) 159.44% Cost of Goods Sold-F&B $20,317 $20,620 ($303) 101.49% Food & Beverage Expense $6,770 $25,430 ($18,660) 375.63% Total Expenses $64,437 $105,600 ($41,163) 163.88%n Net Income (Loss) ($787) ($53,844) $53,057 6841.68% Note: The above revenues and expenditures are also included in the Desert Willow analysis. Dw200 1;PDRFC Budget Page 1 City of Palm Desert Internal Correspondence Date: 30 August 2000 Subject: Additional Prospects for Approved Commercial Paper List From: Thomas W. Jeffrey, Investment Manager 1.J To: Paul S. Gibson, City Treasurer Attached please find: • A list of 18 issuers of commercial paper that have recently been qualified as prospects for the City's Approved List. • A Moody's Credit Ratings Guide. • A list of "The World's Top 50 Banks" that shows the firm's ranking. • A list of "Fortune Global 500 Corporations" that shows the firm's ranking. • A Forbes article on HSBC (which is representative of many of these firms). 1 am recommending that the Finance Committee approve the addition of the following firms to the Approved List for Commercial Paper: PARENT FIRM COUNTRY 1. Associates Corporation NA United States 2. Associates First Capital Corporation United States 3. The CIT Group, Inc. United States 4. First Union Corporation United States 5. Wells Fargo & Company United States 6. Toronto -Dominion Holdings (USA) Inc. Canada 7. Canadian Imperial Holdings, Inc. Canada 8. Scotiabank, Inc. Canada 9. HSBC USA Inc. Great Britain 10. Abbey National North America Corp. Great Britain 11. UBS Finance (DE) LLC Switzerland 12. Credit Suisse First Boston, Inc. Switzerland 13. Deutsche Bank Financial, Inc. Germany 14. Dresdner US Finance, Inc. Germany 15. Commerzbank U.S. Finance, Inc. Germany 16. Bayerische Landesbank NY Germany 17. ABN-AMRO North America Finance, Inc. Netherlands 18. Svenska Handelsbank, Inc. Sweden I used Bloomberg to verify that all of the above companies are organized and operating under United States law. Canadian, British, and European firms must have U.S.-incorporated affiliates or subsidiaries in order to be eligible under California law. Many of these names appear in County portfolios. The maximum risk position of the City in commercial paper is limited to 180 days under current law. CITY OF PALM DESERT ADDITIONAL PROPOSED COMMERCIAL PAPER ISSUERS SEPTEMBER 2000 FINANCE Associates Corporation NA Nationality: Founded: Business: American 1918 Subsidiary of Associates First Capital. Consumer finance, commercial finance, leasing, and insurance services. Associates First Capital Corporation Nationality: Founded: Business: American 1918 Largest finance firm in U.S. Global consumer finance, commercial leasing, credit cards, and insurance services. The CIT Group, Inc. Nationality: Founded: Business: BANK American 1908 Largest commercial lender in world. Global equipment finance, consumer finance, and commercial finance services. First Union Corporation Nationality: Founded: Business: American 1908 Fifth -largest bank in U.S. Domestic retail and commercial banking, consumer finance, insurance, and securities brokerage services. Charlotte - based. Page 1 of 6 COMMERCIAL PAPER Moody's CP Rating P-1 P-1 P-1 P-1 LONG—TERM DEBT Moody's LTD Rating Aa3 Al Al Al CITY OF PALM DESERT ADDITIONAL PROPOSED COMMERCIAL PAPER ISSUERS SEPTEMBER 2000 Wells Fargo & Company Toronto -Dominion Ho/dings (USA) Inc. Nationality: Canadian Founded: 1855 Business: U.S. subsidiary of Toronto - Dominion Bank. Parent is second-largest bank in Canada. Global consumer, corporate, and government banking and securities brokerage services. Owns TD Waterhouse (U.S.) Canadian Imperial Holdings, Inc. Nationality: Founded: Business: Canadian 1867 U.S. subsidiary of Canadian Imperial Bank of Commerce. Parent is third -largest bank in Canada. Global commercial, investment, and corporate banking and insurance services. Owns CIBC Oppenheimer (U.S.). Scotiabank, Inc. Nationality: Founded: Business: Canadian 1832 U.S. subsidiary of Bank of Nova Scotia. Parent is fourth -largest bank in Canada. Global retail, commercial, mortgage, and investment banking services. Canada's most international bank. Active in 50 countries. Page 2 of 6 Moody's CP Ratinq P-1 P-1 P-1 P-1 Moody's LTD Ratinq Aa3 Aa2 Aa3 Aa3 CITY OF PALM DESERT ADDITIONAL PROPOSED COMMERCIAL PAPER ISSUERS SEPTEMBER 2000 HSBC USA Inc. Nationality: Founded: Business: British 1865 U.S. subsidiary (10`h largest bank in U.S.) of HSBC Holdings PLC. Parent is UK's largest bank. Global banking, asset management, investment banking, finance, securities trading, and insurance. Best bank ROE in world — "GE of financial sector". Owns Marine Midland Bank (U.S.). Abbey National North America Corp. Nationality: Founded: Business: British 1849 U.S. subsidiary of Abbey National PLC. Parent is second-largest mortgage lender in UK. Global commercial and mortgage banking and insurance services. UBS Finance (DE) LLC Nationality: Founded: Business: Swiss 1862 U.S. subsidiary of UBS AG. Parent is second-largest bank in world. Private and investment banking, and asset management services. Owns PaineWebber (U.S.) and Dillon Read (U.S.). Page 3 of 6 Moody's CP Rating P-1 P-1 P-1 Moody's LTD Rating Al Aa2 Aa1 CITY OF PALM DESERT ADDITIONAL PROPOSED COMMERCIAL PAPER ISSUERS SEPTEMBER 2000 Moody's Moody's CP Rating LTD Rating Credit Suisse First Boston, Inc. P-1 Aa3 Nationality: Swiss Founded: 1856 Business: U.S. subsidiary of Credit Suisse Group. Parent is second- largest Swiss bank. Global private, corporate, and investment banking services. Owns First Boston (U.S.). Acquiring Donaldson, Lufkin & Jenrette (U.S.). Deutsche Bank Financial, Inc. Nationality: German P-1 Aa3 Founded: 1870 Business: U.S. subsidiary of Deutsche Bank AG. Parent is world's largest bank. Global commercial and investment banking, insurance, and technology services. Owns Bankers Trust (U.S.) and Alex. Brown (U.S.). Dresdner US Finance, Inc. P-1 Aa3 Nationality: German Business: U.S. subsidiary of Dresdner Bank AG. Parent is third - largest bank in Germany. Retail and corporate banking, asset management, and securities sales. Active in 70 countries. Page 4 of 6 CITY OF PALM DESERT ADDITIONAL PROPOSED COMMERCIAL PAPER ISSUERS SEPTEMBER 2000 Commerzbank U.S. Finance, inc. Nationality: German Founded: Business: 1870 U.S. subsidiary of Commerzbank AG. Parent is fourth -largest German bank. Global commercial banking, investment banking, and insurance services. Bayerische Landesbank NY Nationality: German Business: U.S. subsidiary of Bayerische Landesbank Girozentrale. Parent is owned by State of Bavaria and is sixth -largest bank in Germany. Retail, corporate, private, government, and investment banking services. ABN-AMRO North America Finance, inc. Nationality: Founded: Business: Dutch 1824 U.S. subsidiary of ABN AMRO Holding N.V. Parent is largest bank in Netherlands. Global commercial and investment banking services. Owns Chicago Coro. (U.S.) and LaSalle National Bank (U.S.). Largest foreign bank operating in U.S. Active in 70 countries. Page 5 of 6 Moody's CP Rating P-1 P-1 P-1 Moody's LTD Rating Aa3 Aaa Aa2 CITY OF PALM DESERT ADDITIONAL PROPOSED COMMERCIAL PAPER ISSUERS SEPTEMBER 2000 Moody's Moody's CP Rating LTD Rating Svenska Hande/sbank Inc. P-1 Aa2 Nationality: Swedish Business: U.S. subsidiary of Svenska Handelsbank Inc. Global commercial and investment banking, insurance, and mortgage lending services. Active in 21 countries. Page 6 of 6 MERGENT BOND RECORD - 3 7 MOODY'Se BOND RATINGS Purpose: The system of rating securities was originated by John Moody in 1909. The purpose of Moody's, Ratings is to provide the investors whit a simple system of. gradation by which the relative investment qualities of bonds may be noted. - Rating Symbols: Gradabons of investment quality are indicated by rating symbols, each symbol representing a group in which the quality characteristics are broadly the same. There are nine symbols as shown below, from that used to designate least investment risk (i,e., highest invesbnem quaby) to that denoting greatest investment risk (i.e.; lowest investment quality): Aaa Aa A Baa Be B Cea Ca C For explanation of municipal rating symbols, in particular the A 1 and Bea 1 groups see page 6 - . Absence of Rating: Where no rating has been assigned or where a rating has been suspended or withdrawn, it may be for reasons.unrelated to the quality of the issue. Should no rating be assigned, the reason may be one of the following: 1. An application for rating was not received or accepted. _ , 2..The issue or issuer belongs to a group of securities or companies that are not rated as a matter of policy. 3. There is a lack of essential data pertaining to the issue or issuer 4. The issue was ptvatety placed, in which case the rating is not published in- Moody's® publications. . Suspension or withdrawal may occur it new and material circumstances anse, the effects of which preclude satisfactory analysis; rf there is no longer available reasonable up-to-date data to permit a judgment to be formed; if a bond is called for redemption; or for other reasons. - Changes in Rating: The quality of most bonds is not fixed and steady over a period of time, but tends to undergo change. For this reason changes in ratings occur so as to reflect these variations in the intrinsic position of indMdual bonds. , A change in rating may thus occur at any time in the case of an individual issue. Such rating change should serve notice that Moodyse observes some alteration in the investment risks of the bond a that the previous rating did not July reflect the quality of the bond as now seen. While because of their very nature, changes are to be expected - more frequency among bonds of lower .ratings than among bonds of higher ratings, nevertheless the user of bond ratings should keep close and constant check on all ratings -both high and low ratings -thereby to be able to note promptly any signs of change in investment status which may occur. Limitations to Uses of Ratings: Bonds carrying the same rating are not claimed to be of absolutely equal quality. In a broad sense they are alike in position, but since there are a limited number of rating classes used in grading thousands of bonds, the symbols cannot reflect the fine shadings of risks which actually exist. Therefore, f• should -be evident to the user of ratings that two bonds idenbcaly rated are unlikely to be precisely the same in investment quality. As ratings are designed exduswey for the purpose of grading bonds according to their investment qualities, they should not be used alone as a basis for investment operations. For example, they have no value in forecasting the direction of future bends of market price. Market pnce movements in bonds are influenced not only by the quality of indMdual issues but also by changes in money rates and general economic trends, as well as by the length of maturity, etc. During is Ice even the best quality bond may have wide price movements, whbe Is high investment status remains unchanged. The matter of market price has no bearing whatsoever on the determination of ratings which are not to be construed as recommendations with respect to "attractiveness." The attractiveness of a given bond may depend on its yield, is matunty date or other factors fa which the investor may search, as well as on its investment quality, the only characteristic to which the rating refers. Since ratings involve judgments about the future, on the one hand, and since they are used by investors as a means of protection, on the other, the effort is made when assigning ratings to look at "worst" potentatites in the 'visible" tenure, rather than soley at the past record and the status of the present Therefore, investors using the rating should not, expect to find in them a reflection of statistics) factors alone, since they are an appraisal of long temp risks, including the recognition of many non -statistical factors, Though ratings may be used by the banking authorities to classify bonds in their bank examination procedure, Moody'se Ratings are not made with these bank regulations in view. Moodyse Investors Service's own judgment as to desirability or non -desirability of a bond for bank investment purposes is not indicated by Moody'se Ratings. Moodys® Ratings represent the mature opinion of Moody'se Investors Service, Inc., as to the relative investment classification of bonds: As such, they should be used in conjunction wth the description and statistics appearing in Maodysa Manuals. Reference should be made to these statements for information regarding the issuer. Moody'sa Ratings are not commercial credit ratings. In no case is default or receivership to be inputed unless expressly so stated in the Manual - MOODY'S® SHORT-TERM DEBT RATINGS .. . Moody'se short-term debt ratings are opinions of the ability of issuers to repay punctually senior debt obligation. These obilgatons have an original maturity not exceeding one year, unless explicitly noted, - Moody'se employs the following three designations, all judged to be investment grade, to indicate the relative repayment ability of rated issues. •Prime-1 . • Issuers rated Prime-1 (or supporting institutions) have a superior ability for repayment of senior short-term debt obligations. Prime-1 repayment ability will often be evidenced by many of the -following characteristics: -. ;, - - . . . —Leading market positions in well -established industries. ' , — High rates of return on funds employed. — Conservative capitalization structure wait moderate reliance on debt and ample asset protection. - - —Broad margins in earnings coverage of fixed financial charges and high intemal cash generation. . —Well-established access to a range of financial markets and assured sources of Issuers rated Prime-2 (or suppomng institutions) have a strong ability for repayment of senior short -tens debt obligations. This will normally be evidenced by many of the characteristics cited above but to a lesser degree. Earnings trends and coverage ratios, - while sound, may be more subject to variation. Capitalization characteristics, while still appropriate, may be mom affected by external conditions. Ample,atemate liquidity is Issuers rated Prime-3 (a supporting institutions) have an acceptable ability for repayment of senior start -term obligations. The effect of industry characteristics and market compositions may be more pronounced. Variability in earnings and profitability may result in changes in the level of debt protection measurements and may require relatively high financial leverage. Adequate alternate liquidity is maintained. Issuers rated Not Prime do not fall within any of the Prime rating categories. , Moody'se makes no representation that rated bank or insurance company obligations are exempt from the registration under the U.S. Securities Act of 1933 or issued in conformity with any other applicable law or regulation. Nor does Moodyse represent that any speck bank or insurance company obligation'is legaly enforceable or a valid senior obligation of a rated issuer. - - t an issuer represents to Moodyse that its short-term debt obligators are supported by the credit of another entity or entities, then the name or names of such supporting entity or entities are fisted within the parentheses beneath the name of the issuer, or there is a footnote refemng the reader to another page for the name or names of the supporting entity or entities. In.assigni g ratings to such issuers, Moodyse evaluates the financial strength at the affiliated corporations, commercial banks, insurance companies, foreign govemmens or Other entities, but only as one factor in the total rating assessment Moodyse makes no representation and gives no opinion on the Legal validity or enforceability ol any support arrangement. , Moody's. ratings are opinions, riot recommendations to buy or sell, and their aaxnacy is not guaranteed. A rating should be weighed solely as one factor in an investment decision and you should make your own study and evaluation of any issuer whose securities or debt obligations you consider buying or sang. BRANCH (DEPOSIT) OBLIGATIONS Obligations of a branch of a bank are considered to be domidled in the country in which the branch is located. Unless noted as an exception, Moodyserating on a bank's ability to repay senior obligations extends only to branches located in countries. which carry a Moody'se Sovereign Rating for Bank Deposits. Such branch obligations are rated at the lower of the bank's rating or Moodyse Sovereign Rating for Bank Deposits for the country in which the branch is located. , - When the currency in which an obigation is denominated is not the same as the currency of the country in Mich the obligation is domiciled, Moodyse ratings do not incorporate an opinion as to whether payment of She obligation will be affected by actions of me government controlling the currency of denomination. In addition, risks associated with bilateral conflicts between an investors home country and either the issuer's home country or the country where an issuers branch is located am not incofpaoated into Moody's, short-term debt ratings. . MOODY'Se CORPORATE LONG-TERM RATINGS Bonds which are rated Aaa are judged to tie of the best quality. They carry the smallest degree of investment risk and are generally referred to as "gilt edged." Interest payments are protected by a large or by an exceptionally stablemarginand principal is secure. Whie the various protective elements are likely to change, such changes as can be visualized are most unlikely to impair the fundamentally strong position of such issues. MERGENT BOND RECORD January 2000 .-. Bonds which are rated Aa are judged to be of high quality by ati standards. Together wth the Aaa group they comprise what are generally known as high grade bonds. They are rated lower than the best bonds because margins of protection may not be as large as in Ma securities o fluctuation of protective elements may be of greater amplitude or there may be other elements present which make the long-term risk appear somewhat larger than the Aaa securities. - . Bonds which are rated A possess many favorable investment amibutes and are to be considered as upper-mediumgrade obligations. Factors giving security to pnncpal and interest are considered adequate, but elements may be present which suggest' a susceptthitity to impairment some time in the future. . Baa Bonds which, are rated Bea are considered as medium -grade obligations, (i.e., they are neither Nghly protected nor poorly secured). Interest payments and pnndpal security appear adequate for the present but certain protective elements may be lacking or may be c aracteristicelly unreliable over any great length of lime. Such bonds lack outstanding investment characteristics and in fact have speculative characteristics as well • - -- • . Bonds which are rated Ba are judged to have speculative elements; their future cannot be considered as well -assured. Often the protection of interest and principal payments may be very moderate, and thereby not well safeguarded during both good and bad times over the future. Uncertainty of position characterizes bonds in this lass. • Bonds which are rated B generally tack characteristics of the desirable investment. Assurance of interest and principal payments or of maintenance of other terms of the contract over any long period of time may be small. . Cara ... bonds which are rated Caa are of poor standing. Such issues may be in default or there may be present elements of danger with respect to principal or interest. Bonds which are rated Ca represent obligations which are speculative in a high degree. Such issues are often in default or have other marked shortcomings. Bonds which are rated C are the lowest coded lass of bonds, and issues so rated can be regarded as having extremely poor prospects of ever attaining any real investment standing. - - , - .. Moody's. bond ratings, where specified, are applied to senior bank obligations and insurance company senior policyholder and claims obligations with an original maturity in excess of one year. Obligations relying upon support mechanisms such as letters-of- cre_ dd and bonds of indemnity are excluded unless explicitly rated_--., ...:.� Moody'sa assigns ratings to individual longterm debt securities issued from. medium -temp note.(MTN) programs, in addition to indicating ratings to MTN -- programs themselves. Notes issued under MTN programs with such indicated ratings are rated at issuance at the rating applicable to all. pad passu notes issued under the same program, at the program's relevant indicated rating, provided such notes do not exhibit any of the following characteristics listed below. For notes wtlh any of the following characteristics; the rating of the individual note may differ from the indicated rating of the program:.. 1. Notes containing features which Zink the cash flow and/or market value to the - • credt performance of any third party or parties, 2. Notes allowing for negative coupons, or negative principal. - 3. Notes containng any provision which could obligate the investor to make any Market participants must determine whether any particular note is rated, and it so, at what rang level. Moodysa encourages market participants fo contact Moodysa Ratings Desks directly if they have questions regardingatings for specific notes issued MOODY'Ss MUTUAL FUND RATINGS - - Moody's® Money Market and Bond Fund Ratings are opinions of the investment quality of shares in mutual buds and similar investment vehicles which pnndpalty invest in shod -temp and long-term fixed income obligations, respectively. As such, these ratings Incorporate Moody's® assessment of a funds published investment objectives and policies, the creditworthiness of the assets held by the fund, as well as the management characteristics of the hind. The ratings are not intended to consider the prospective, performance of a fund with respect to appreciation, volatility of net asset value, or yield. The rating definitions are as follows: Aaa Money Market Funds and Bond Funds rated Aaa are judged to be of an investment quality similar to Aaa-rated feed income obligations, that is, they are judged to be of the best quality, , . - . Money Market Funds and Bond Funds rated Aa are judged to be of an investment quality similar to Aa-rated foxed income obligations, that is, they are judged to be of high quality by all standards. •, . A Money Market Funds and Bond Funds rated A are judged to be of an investment quality similar to A -rated fxed'income obligations, that is, they are judged to possess many favorable investment attnbutes and are considered as upper -medium -grade investment vehicles. Baa Money Market Funds and Bond Funds rated Baa are judged to be of an investment quality similar to Baa-rated 'fixed income obligations, that is, they are considered as medium -grade investment vehicles. - Ba Money Market Funds and Bond Funds rated Ba are judged to be of an investment quality similar to Ba-rated fixed income obligations, that is, they are judged to have speculative elements. 'B Money Market Funds and Bond Funds rated B are judged to be of an investment quality similar to B-rated fixed income obligations, that is, they generally lack characteristics of the desirable investment. MOODY'S® FUND MARKET RISK RATINGS Money Market and Bond Mutual Funds Moody'se Mutual Fund Market Risk (MR) ratings are opinions of the relative degree of volatility of a rated fund's net asset value (NAV). In fuming an opinion on the fund's future price volatility, Molly's® anatysts consider risk elements that may have an effect' on a fund'snet asset value such as: interest rate risk, prepayment and extension risk, liquidity and concentration risks, currency risk and denvatives risk. The ratings are not intended to consider prospective performance of a fund with respect to pace appreciation or yield. _ . ' MR1 Money Market Funds and Bond Funds rated MR1 are judged to have very low sesltivgy to changing interest rates and other market conditions. - - MR2 Money Market Funds and Bond Funds rated MR2 are judged to have low sensitivity to changing interest rates and other market conditions. MR3 • Money Market Funds and Bond Funds rated MR3 are judged to have moderate sensitivity to changing interest rates and other market consitions. - MR4 Money Market Funds and Bond Funds rated MR4 are judged to have high sensftivdy to changing interest rates and other market conditions. MR5 Money Market Funds and Bond Funds rated MRS are judged to have very high sensitivity to changing interest rates and other market conditions. Note: A "+" modifier appended to the MR1 rating category denotes constant NAV money market funds and other qualifying funds. - M00DY'S® INSURANCE FINANCIAL STRENGTH RATINGS • Moody'se Insurance Financial Strength Ratings are opinions of the ability of insurance companies to repay punctually senior policyholder claims and obligations. Speck obligations are considered unrated unless individually rated because the standing of a particular insurance obligation would depend on an assessment of its relative standing under those aws governing both the obligation and the insurance company. It is important to note that Moody's® makes no representation that rated insurance company obligations are exempt from registration under the U.S. Securities Am of 1933 or issued in conformity with any other applicable law- or regulation. Nor does Moody'se represent that any specific insurance company obligation is legally enforceable or a valid senior obligation of a rated issuer. Insurance Financial Strength Ratings shown in connection with property/casualty groups represent the ratings of individual companies within those groups, as displayed in Moody's® msurance industry ratings list. The rating of an indMdual property/casualty company may be based on the benefit of its participation in an intercompany pooling agreement. Poling agreements may or may not provide for continuation of inforce policyholder obligations by pool members in the event that the property/casualty insurer is sold to a third party or otherwise removed from the pooling. agreement. Moody's® assumes in these ratings that the pooling agreement will not be modified by the members of the pool to reduce the benefits of pool participation, and that the Insurer will remain in the pool. Moodys® makes no representation or warranty that such pooling agreement will not be modified over time, nor does Moody's® opine on the probability that the rated entity may be sold or otherwise removed from the pooling agreement. Page 1 of 3 The World's Top Banks All banks have been ranked by total assets in US$*. For a full listing of the top 3,000 banks in the world, or the top banks by country, please use our Power Search facility. The World's Top 50 Banks Current Previous BANK Assets + or - Capital Balance / Rank Rank USSm (local curr) US$m Sheet IT 1 (-) Deutsche Bank AG, Frankfurt am Main, Germany *841,801 1,576.63 31.12.99 i., 2 (1) UBS AG, Zurich Switzerland 686,634 +5.59% 2,691.95 31.12.99 3 (3) The Bank of Tokyo -Mitsubishi Ltd, Tokyo, Japan *617,960 -14.52% 6,544.84 31.03.99 4 (-) Bank of America NA, Charlotte, USA 571,732 2,833.00 31.12.99 5 (5) ABN AMRO Holding NV, Amsterdam, Netherlands *507,372 +13.84% 1,930.52 31.12.98 6 (-) Bayerische Hypo-und Vereinsbank AG, Munich, Germany 504,415 1,267.92 31.12.99 7 (6) Credit Agricola, Paris, France *458,721 +1.89% 4,605.64 31.12.98 8 (7) The Sumitomo Bank Ltd, Tokyo, Japan *457,772 -14.60% 6,269.03 31.03.99 9 (8) Societe Generale, Paris La Defense, France *450,368 +2.31% 4,122.83 31.12.98 * Figures are consolidated Current Previous BANK Assets + Or- Capital Balance Rank Rank US$m (local curr) US$m Sheet 10 (9) The Dai-Ichi Kangyo Bank Limited, Tokyo, Japan 437,458 -2.35% 7,142.64 31.03.99 ✓ 11 (10) Dresdner Bank AG, Frankfurt am Main, Germany *429,159 +6.38% 1,553.79 31.12.98 12 (11) Westdeutsche Landesbank Girozentrale, Dusseldorf, Germany *416,082 +14.78% 1,390.08 31.12.98 13 (12) The Norinchukin Bank, Tokyo, Japan 408,927 -5.99% 9,367.97 31.03.99 14 (13) The Sakura Bank Ltd, Tokyo, Japan *408,152 -7.80% 8,682.70 31.03.99 15 (19) Barclays Bank PLC, London, UK *397,668 +16.17% 2,409.35 31.12.99 16 (14) The Sanwa Bank, Limited, Tokyo, Japan 396,308 -9.71% 13,113.46 31.03.99 17 (15) The Fuji Bank Ltd, Tokyo, Japan 386,247 -9.21% 8,642.12 31.03.99 18 (17) Banque Nationale de Paris SA, Paris, France *381,437 +4.71% 978.16 31.12.98 * Figures are consolidated http://www.bankersalmanac.com/addcon/world/wldrank.htm 8/4/00 Page 2 of 3 Current Previous BANK Assets + or - Capital Balance Rank Rank US$m (local curr) US$m Sheet 19 (-) Commerzbank AG, Frankfurt am Main, Germany *372,898 - 1,338.08 31.12.99 20 (18) Industrial & Commercial Bank of China, Beijing, China 354,731 -19.09% 10,390.75 31.12.98 21 (20) The Industrial Bank of Japan Ltd, Tokyo, Japan 350,481 -6.76% 5,609.17 31.03.99 22 (26) The Chase Manhattan Bank, New York City, USA *332,198 +11.96% 1,211.00 31.12.99 23 (21) ING Bank NV, Amsterdam, Netherlands *328,920 +60.83% - 31.12.98 24 (24) Citibank NA, New York City, USA *327,899 +8.97% 751.00 31.12.99 25 (22) Paribas, Paris, France *311,314 +18.45% - 31.12.98 26 (23) National Westminster Bank Plc, London, UK *309,421 +0.27% 3,621.69 31.12.98 27 (-) Banca Intesa SpA, Milan, Italy *304,664 2,798.39 31.12.99 * Figures are consolidated Current Previous BANK Assets + Or Capital Balance Rank Rank US$m (local curr) US$m Sheet 28 (25) Bank of China, Beijing, China / 299,000 +10.92% 12,622.45 31.12.98 V 29 (28) Credit Suisse First Boston, Zurich, Switzerland *293,922 -10.86% 2,373.50 31.12.98 30 (29) Rabobank Nederland, Utrecht, Netherlands / *293,231 +28.57% 31.12.98 t/ 31 (27) Abbey National plc, London, UK / *291,288 +11.05% 752.62 31.12.99 32 (30) Bayerische Landesbank Girozentrale, Munich, Germany *285,326 +9.35% 3,458.65 31.12.98 33 (31) Lloyds TSB Bank plc, London, UK *279,483 +6.26% 2,294.13 31.12.98 34 (32) DG BANK Deutsche Genossenschaftsbank AG, Frankfurt am Main, Germany *263,999 +17.71% 1,701.49 31.12.98 35 (33) Landesbank Baden-Wurttemberg, Stuttgart, Germany *260,424 - 1,685.20 31.12.98 36 (35) The Tokai Bank Ltd, Nagoya, Japan 252,837 -4.95% 6,020.23 31.03.99 * Figures are consolidated Current Previous BANK Assets + or - Capital Balance Rank Rank USSm (local curr) US$m Sheet 37 (36) Credit Lyonnais, Paris, France *245,277 1,680.37 31.12.98 38 (37) Fortis Bank NV/SA, Brussels, Belgium *244,785 +42.24% 1,294.45 31.12.98 39 (38) The Asahi Bank Ltd, Tokyo, Japan 238,466 -2.15% 3,374.86 31.03.99 i/ 40 (39) First Union National Bank, Charlotte, USA *229,272 +3.05% 616.00 31.12.99 41 (40) Bankgesellschaft Berlin AG, Berlin, Germany http://www.bankersalmanac.com/addcon/world/wldrank.htm 8/4/00 Page 3 of 3 *221,626 +4.02% 654.42 31.12.98 42 (45) The Hongkong and Shanghai Banking Corporation Limited, Hong Kong, Hong Kong *210,702 +10.58% 2,091.46 31.12.99 43 (41) Halifax plc, Halifax, UK 207,970 +8.73% 810.18 31.12.98 44 (42) International Bank for Reconstruction and Development, Washington, USA 204,971 +26.57% 11,288.00 30.06.98 45 (43) China Construction Bank, Beijing, China 203,121 +6.70% 4,338.62 31.12.97, * Figures are consolidated Current Previous BANK Assets ♦ or - Capital Balance Rank Rank US$m (local curr) US$m Sheet 46 (44) The Long -Term Credit Bank of Japan Ltd, Tokyo, Japan 200,944-10.20% 2,971.03 31.03.98 47 (46) Kreditanstalt for Wiederaufbau (KFW), Frankfurt am Main, Germany 189,129 +13.16% 600.38 31.12.98 48 (49) Royal Bank of Canada, Montreal, Canada *184,003 -1.37% 3,449.59 31.10:99 49 (52) Caisse des Depots et Consignations, Paris, France *171,891 -6.87% 31.12.98 50 (51) HSBC Bank plc, London, UK *171,584 +1.55% 1,284.45 31.12.99 * Figures are consolidated These bank rankings are compiled from balance sheet information included in The Bankers' Almanac. 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FT.com FT500 GLOBAL goo ToP coecce4nous (roRrufJE) Global Global 500 USA Canada Latin America Europe Eastern Europe Japan Asia Pacific UK Middle East Sub -Saharan FT.com Home iseek Global 500 - Section One THURSDAY MAY 4 2000 Rank Rank Market Turnover This Last year 2000 1998 Company Country Capital $m Sector Rank year $m $m 1 1 Microsoft US 586,196.50 977 98 19,747.00 14,484.00 2 2 General Electric US 474,955.70 252 7 110,832 00 99,820 00 3 NTT DoCoMo Jap 366,203.90 678 57 30,190.70 25,424.70 4 19 Cisco Systems US 348.964.50 938 161 12,154.00 8,458.80 5 9 Wal-Mart Stores US 286,152.80 524 2 165,013.00 137,634.00 6 7 Intel US 277,095 80 936 69 26.273 00 25,070 00 7 11 NTT Jap 274,905.10 673 9 94,197.60 91,490.10 8 Exxon Mobil US 265,893 90 78 8 100.697.00 120,279.00 9 21 Lucent Technologies US 237,667.90 938 37 38,303.00 30,147.00 10 27 Deutsche Telekom Ger 209,628 10 673 42 36,834 90 35,617 4D 11 62 Nokia Fin 208,077.40 938 138 13,743.50 9,126.10 12 4 Royal Dutch/Shell Nuk 205,582 50 78 10 93,692.00 128,155.00 13 10 Intl Business Machines US 201,014.20 932 11 81,667.00 78,508.00 14 22 BP Amoco UK 190,087 80 78 15 68,304 00 91,760.00 15 26 Toyota Motor Jap 179,576.60 311 6 123,429.30 113,064 20 16 145 America Online US 176.266.60 974 257 4,777 00 2,600 00 17 Citigroup US 169,917.30 810 N/R N/R 18 17 AT&T US 163,746 00 673 22 53,223 00 51,319 00 19 29 American International US 152,695.30 839 N/R N/R Group 20 5 Merck US 152,079.70 480 66 26,89820 23,63690 21 116 Oracle 05 151,922.40 977 193 8,827.30 7,143.90 22 25 BUK 151,549.40 673 63 27,75090 25,601 60 Telecommunications 23 30 SBC Communications US 150,423.00 673 25 49,489.00 28,777.00 24 Vodafone Airtouch UK 150,081,50 678 246 5,50010 4,044.50 25 47 Home Depot US 142,171.00 526 55 30,219.00 24,156.00 26 24 Mci Worldcom US 140,498,10 673 114 17,67800 7,351.40 27 20 Procter & Gamble US 138,314.40 475 38 38,125.00 37,154.00 28 8 Coca-Cola US 138,148 20 418 97 19,805.00 18,813,00 29 46 France Telecom Fra 131,035.70 673 56 25,434.40 24,167.40 30 75 Ericsson Swe 129,559 40 938 89 22,043 20 20,047 60 31 167 Nortel Networks Can 129,205.00 938 106 18,649.00 15,224.30 32 195 Sun Microsystems US 125.344 60 932 168 11,726.30 9,790.80 33 133 Seven -Eleven Japan Jap 125,227 80 630 293 2,990.60 2,777.80 34 14 Johnson & Johnson US 123,444 40 480 85 23,657 00 22,629.00 35 110 SONY Jap 123,252.00 345 16 65,782.00 65,403.10 36 28 Dell Computer US 119,600.50 932 109 18,243.00 12,327 00 37 6 Pfizer US 118,801.20 480 140 13,544.00 12,504.00 38 16 Brnslol Myers Squibb US 118 029.70 480 108 18,284 00 16,701.00 39 83 Mannesmann Ger 117,315 80 678 100 19,662.70 20,616.20 40 293 Yahoo US 116,615.30 974 362 203 3 67.4 41 Qualcomm US 114,779.70 938 275 3,937.30 3,347.90 42 59 HSBC Holdings UK 113,869.00 810 N/R N/R 43 112 EMC US 110,642 20 932 273 3,973.70 2,937.90 0nflh.a..L Inc qM vn 077 00' c 111 nn A o7n 1n http://www.ft.com/specials/globa15002a.htm 8/8/00 FT.com - FT500 Page 2 of 10 45 50 Hewlett-Packard US 108,563.00 932 32 42,370.00 47,061.00 46 18 Roche Swi 108,390.10 480 126 15,854 70 12,064 90 47 13 Novartis Swi 104,559.20 480 93 20,380.60 20,045.00 48 15 Glaxo Wellcome UK 100,725.00 480 148 13,067.60 13,062.70 49 134 Motorola US 97,775.20 938 58 29,398.00 29,794.00 50 Total Fina Fra 94,605.50 78 77 25,109,70 30,060 60 51 198 China Telecom (Hong HK 92,082.50 673 287 3,182.00 1,870.60 Kong52 33 Bell Atlantic US 90,061 60 673 49 31,565.90 30,367 90 53 226 Fujitsu Jap 89,24560 932 24 50,759.90 48,265.90 54 35 Bellsouth US 83,86060 673 75 25,22400 23,12300 55 77 Telefonica Spa 80,661.70 673 111 18,013.10 14,647.80 56 34 Allianz Ger 80,567 70 839 N/R N/R 57 54 Time Wamer US 80,529.60 535 131 14,582.00 13,294.00 58 173 Texas Instruments US 80.439.20 936 184 9,468.00 8,460 00 59 36 Berkshire Hathaway US 78,886.80 839 N/R N/R 60 Bank of America US 77,784.40 810 N/R N/R 61 DaimlerChrysler Ger 75,625 80 311 3 146,958.70 132,487.20 62 95 Siemens Ger 73,734 00 252 18 62,056.30 56,379 80 63 AstraZeneca UK 71,275.80 480 189 9,132.30 8,515.10 64 138 Morgan Stanley Dean US 71,055 10 875 N/R N/R Witter 65 74 T.I.M. Ita 71,006.10 678 232 6,335.60 5,034.40 66 31 Nestle Swi 70,96390 435 29 46,124,70 45,00030 67 80 Telecom Italia Ita 70,946.30 673 81 24,205.00 22,794.70 68 43 Smithklme Beecham UK 69,63940 480 144 13,229.70 12,759.90 69 23 Lilly (Eli) US 68,968.20 480 187 9,236.80 8,517.60 70 79 Telstra Austl 68,77460 673 173 11,50990 10,94130 71 42 'Warner-Lambert Co US 68,156.20 480 177 10,213.70 8,179.60 72 308 AT&T Liberty Media US 67,804 40 542 329 1,559 00 374 2 73 41 Du Pont (E I) De US 67,803.50 113 79 24,899.00 39,911.00 Nemours 74 82 American Express US 66,992.00 873 N/R N/R 75 53 Disney (Walt) US 65,720.30 538 86 23,402.00 22,976.00 76 44 Lloyds TSB Group UK 65,067 60 810 N/R N/R 77 63 Aegon Net 64,065.80 840 N/R N/R 78 364 NTT Data Jap 63,817,90 972 219 6,875 30 6,550 30 79 51 GTE US 63,652.60 673 74 25,336.00 25,473.00 80 94 Tyco International US 62,592.80 240 87 22,496 50 12,311.30 81 102 Bank of Tokyo- Jap 62,466.20 810 N/R N/R Mitsubishi 82 Wells Fargo US 60,970 20 810 N/R N/R 83 146 Carrefour Fra 60,721.10 630 61 28,283.50 26,628.60 84 190 Amgen US 59,493.50 480 285 3,34010 2,718.20 85 39 Fannie Mae US 59,117.50 877 N/R N/R 86 68 1NG Net 58,323 60 834 N/R N/R 87 111 Matsushita Electric Ind. Jap 58,008.40 253 13 73,967.70 76,393.30 88 76 Chase Manhattan US 57,961 10 810 N/R N/R 89 48 Ford Motor US 57,562.30 311 4 144,416.00 153,627.00 90 179 Hutchison Whampoa HK 57,309 80 240 226 6,606 80 5,733 40 —) 91 70 UBS Swi 56,801.70 810 N/R N/R 92 Hikan Tsushin Jap 56.65650 673 304 2,51020 1,545.30 93 32 Schering-Plough US 55,890.00 480 188 9,176.00 8,077,00 94 208 BCE Can 55,01640 673 182 9,78860 18,906.40 95 49 Chevron US 54,880.20 78 70 26,187.00 35,009.00 96 12 Philip Morris US 54,654 70 490 19 61,751.00 57,813 00 97 243 Hitachi Jap 54,613.60 938 12 77,232.80 81,487.40 98 38 Unilever plc/NV Nuk 52,887 20 435 33 41,684 00 44,249 70 99 40 Abbott Laboratories US 52,621.60 446 146 13,177.60 12,477.80 http://www,ft.com/specials/globa15002a.htm 8/8/00 FT.com - FT500 Page 3 of 10 1UU /2 MCUonans US 02,5b3.5U bOU 155 12,427 4U 11,4Utl.6U ----). 101 109 Credit Suisse Swi 52,478.40 810 N/R N/R 102 64 Pepsico US 52.314.90 418 88 22,348 00 20,917 00 103 37 American Home US 52,102.90 480 141 13,462.70 14,196.00 Products 104 459 Murata Mfg Jap 51,41640 936 281 3,553.60 3,50710 105 101 L'Oreal Fra 51,108.90 477 167 11,852.50 10,862.40 106 97 Vivendi Fra 50,456.70 240 45 33,154.70 25,96280 107 Sprint Fon Group US 50,316.40 673 119 17,016.00 16,016.90 108 Matsushita Com Ind. Jap 49,819 90 938 197 8,627 00 8,362 60 - .109 119 Deutsche Bank Ger 49,706.20 810 N/R N/R 110 52 Compaq Computer US 48,662 50 932 36 38,525 00 31,169.00 111 Enel lta 48,649.60 720 95 20,132.20 20,120.00 112 100 Axa Fra 47,833 70 839 N/R N/R 113 127 Mediaone Group US 47,505.00 543 297 2,882 00 3,847.00 114 Sonera Fin 47.284 40 673 320 1,672 70 1,338 80 115 Korea Telecom K re ea 47,003.80 673 190 9,083.40 7,211.80 116 201 Philips Net 46,511.40 253 50 3141360 30,58800 117 411 Applied Materials US 46,475.10 936 256 4,859.10 4,041.70 118 Internet Cap Group US 46 149 60 879 N/R N/R 119 73 Zurich Financial Swi/UK 45,880.90 839 N/R N/R Services 120 186 Marconi UK 45.762 90 938 237 6,202.30 6,276 00 121 217 Alcatel Fra 45,600.30 938 90 21,925.50 29,239.90 122 450 Kyocera Corp Jap 45,142 80 938 217 7,022 20 7.022 10 123 333 Rohm Jap 45,124.60 932 288 3,181.60 3,252.20 124 Aventis Fra 44,774 20 480 139 13,654 50 14,151 30 125 325 Taiwan Semiconductor Taiwan 44,731.10 936 322 1,651.90 1,439.00 126 78 General Motors US 44,392 00 938 1 173,215 00 158,514 00 127 Honeywell International US 44,360.60 215 84 23,735.00 15,128.00 128 69 Munich RE Ger 44,349 10 837 N/R N/R 129 183 Ito-Yokado Jap 44,311.40 528 48 31,629.80 30,299.10 130 252 KPN Net 43.907 60 673 207 7,708.90 7.045.60 131 STMicroelectronics Fra 43,511.90 936 266 4,210.60 3,969.80 132 216 CBS US 43,170.60 542 221 6,80500 5,363.00 133 JDS Uniphase US 42,806.40 936 360 282.8 175.8 134 Sprint PCS Group US 42,663 40 678 289 3,180 00 1,225 40 135 66 Gillette US 42,638.20 477 180 10,056.00 10,062.00 136 160 Sumitomo Bank Jap 42,574 20 810 N/R N/R 137 219 Comcast US 42,450.00 543 236 6,209.20 5,145.30 138 61 Eni Its 42,338 00 78 31 44,142 30 47,728 60 139 BSCH Spa 42,026.80 810 N/R N/R 140 BNP Panbas Fra 41,730 B0 810 NIR NIR 141 Oracle Corporation Jap 41,661.70 977 349 531 451.1 Japan 142 108 Fortis Bel/Net 41,54690 810 NIR NIR 143 153 Cable & Wireless UK 41,331.50 673 150 13,003.80 11,460.10 144 126 Medtronic US 41,29320 446 269 4,134.10 2,60480 145 142 Barclays UK 40,841.30 810 N/R N/R 146 Samsung Electronics Korea 40.780.20 936 112 17,892.40 16,450 20 147 310 LVMH Fra 40,608.00 349 215 7,157.40 7,556.60 148 358 NEC Corp Jap 40,443.90 938 30 46,078 10 47,450.10 149 143 Takeda Chemical Ind. Jap 40,034.00 480 203 8,177.40 8,150.00 150 131 Tokyo Electric Power Jap 39.293 30 720 26 49,263.30 51,099 00 151 CMG! US 38,980.80 974 364 175.7 91.5 152 180 Rio Tinto UK/Aus 38,214 80 48 216 7,022 40 7,711 60 153 258 Nomura Securities Jap 37,914.00 875 N/R N/R 154 172 Viacom US 37,463.00 535 163 12,096.10 13,20610 http://www.ft.com/specials/globa15002a.htm 8/8/00 FT.com - FT500 Page 4 of 10 10D uiooai I.rossing u0 sr, I03.30 0/J J4I I,004.au 4G4. i 156 171 Computer Associates US 36.989 70 977 249 5,253 00 4 719.00 Intl 157 117 Prudential Corporation UK 36,591 50 840 N/R N/R 158 Goldman Sachs Group US 36,528 20 875 N/R N/R 159 105 Honda Motor Jap 36,131.30 311 20 60,325.70 58,086.30 160 107 Minnesota Mining & Mfg US 35,990.90 240 127 15,659 00 15,021.00 161 210 ABB Swi 35,487 20 252 68 26,488.00 29,673.00 162 154 National Westminster UK 35,393 80 810 N/R N/R Bank 163 176 Gap US 35,365.70 542 170 11,635.40 9,054.50 164 181 Colgate-Palmolive US 35.319 00 475 191 8,971.60 9,056 70 ->165 147 ABN Amro Net 35,095.50 810 N/R N/R 166 United Micro Electronics Taiwan 35 022 BO 936 347 566.9 805 7 167 158 Kimberly-Clark US 34,946.60 477 149 13,006.80 12,297.80 168 151 Cable & Wireless HKT HK 34.90540 673 267 4,167.40 4.50550 169 89 Boeing US 34,857.30 215 21 57,993.00 56,154.00 170 207 Canon Jap 34.595.60 253 73 25,38740 27,362.50 171 Bank One US 34,406.40 810 N/R N/R 172 130 U S West US 33,774.20 673 145 13,182 00 12,378 00 173 Verltas Software US 33,773 80 977 346 596.1 210.9 174 235 Sanwa Bank Jap 33,448.20 810 N/R N/R 175 115 Bayer Ger 33,368.50 113 59 28,941.60 29,005.40 176 139 Singapore Telecom Sin 33.077 30 673 295 2,949 00 2,984 40 177 Fuji Bank Jap 32,841.80 810 N/R N/R 178 Nextel Communications US 32,824 30 678 317 1,846 80 738 9 179 157 Automatic Data US 32,773.80 972 245 5,540.10 4,798.10 Processing 180 211 Teletonos de Mexico Mex 32,666.70 673 202 8,280 30 7,622 50 181 424 Genentech US 32,652.80 480 333 1,331.90 1,062.20 182 Colt Telecom Group UK 32 558 40 673 357 352 133 4 183 92 Generali Ita 32,483.40 839 N/R N/R 184 137 Suez Lyonnaise des Fra 32,017.00 240 47 32,343 80 29,955 90 Eaux 185 132 Anheuser-Busch US 31,777.10 415 175 11,245.80 11,066.20 186 DDI Jap 31.70870 673 164 12,06880 11,40810 187 150 Basf Ger 31,186.80 113 60 28,509.60 29,414.10 --* 188 58 First Union IN C) US 30,805 70 810 N/R N/R 189 121 Schlumberger US 30,708.30 75 198 8,394.90 11,815.60 190 87 Fed Home Loan Mtg US 30.478 40 877 N/R N/R 191 212 Enron US 30,413.60 730 51 31,260.00 20,273.00 192 Corning US 30,339.70 938 263 4,33810 3,532.40 193 231 Target US 30,207.00 524 52 30,951.00 27,757.00 194 225 Pinault Pnntemps Fra 30 170.50 527 118 17,024 00 14,014.60 195 360 Schwab (Charles) US 30,133.90 875 N/R N/R 196 166 BBV Spa 30.09560 610 NIR NIR 197 281 Alcoa US 30,044.00 186 124 16,32300 15,339.80 198 371 Qwest Communication US 29 780.10 678 308 2,242 70 696 7 Intl 199 227 Merrill Lynch US 29,734.30 875 N/R N/R 200 Swisscom Swi 29.694.20 673 223 6,725.20 6,327 20 201 Agilent Technologies US 29,634.50 253 201 8,331.00 7,952.00 202 113 Swiss Re Swi 29,547 20 837 N/R N/R 203 128 Sap Ger 29,380.20 977 261 4,463.90 3,173.10 204 228 Electronic Data Systems US 29,365 00 972 121 16,891 00 15,235.60 205 353 Cheung Kong Ltd (Holdings) HK 29,024.80 862 N/R N/R 206 Sharp Corp. Jap 28,794 40 253 120 16,899 40 17,335 10 207 88 Texaco US 28,762.60 78 53 30,910.00 45,187.00 208 316 Clear Channel US 28,698 20 542 299 2,678 20 1,350 90 Communications http://www.ft.com/specials/globa15002a.htm 8/8/00 FT.com - FT500 Page 5 of 10 209 274 Dai-ichi Kangyo Bank Jap 28,627.20 810 N/R N/R 210 393 Level 3 Communications US 28,618,30 673 351 515 392 211 193 Carnival US 28,586.90 538 282 3,497.50 3,009.30 212 FleetBoston Financial US 28,437.70 810 N/R N/R 213 Sanofi-Synthelabo Fra 28,425.30 480 240 6,034.60 5,877.50 214 215 United Technologies US 28,416 40 215 82 24,127 00 25,715 00 215 Broadcom US 28,365.40 936 350 518 2 203.1 216 191 Dow Chemical US 28.289 30 113 105 18,929 00 18,473.00 217 SK Telecom Korea 28,219.90 673 290 3,158.30 3,128.70 218 85 Diageo UK 27.981 80 416 103 19,307.60 28,97040 219 Amazon.Com US 27,923.40 528 323 1,639.80 610 220 Akamai Technologies US 27,919.20 977 386 4 221 244 Cox Communications US 27,906.70 543 307 2,318.10 1,716.80 222 162 Walgreen US 27,671 70 630 113 17,83880 15,307,00 223 Fanuc Jap 27,593.70 253 309 2,188.70 2,234.40 224 249 Bnbsh Sky Broadcasting UK 27,474.50 543 302 2,529.10 2 347 50 Group 225 Anglo American UK 26,691.50 45 132 14,443.00 0 --3.226 178 Dresdner Bank Ger 26,620 50 810 N/R N/R 227 114 Bayerische Hypo- Ger 26,530.10 810 N/R N/R Vereinsbank 228 174 Bank of New York US 26,464.70 810 N/R N/R 229 491 Tellabs US 26,304.70 938 306 2,319.50 1,660.10 230 152 Atlantic Richfield US 26,126.60 73 154 12,501 00 10,303.00 231 448 Sun Hung Kai Properties HK 25,931.40 862 N/R N/R 232 Japan Telecom Jap 25,613.90 673 268 4,144 40 3,986 50 233 Solectron US 25,577.20 932 199 8,391.40 5,288.30 234 Secom Jap 25,498 30 588 284 3,411 40 3,063.70 235 318 Toshiba Jap 25,492.80 932 23 51,320.60 52,846.30 236 Yahoo Japan Jap 25,187.00 974 382 18 5 12.3 237 276 Hennes & Mauritz Swe 25,138.50 528 298 2,694.00 2,152.60 238 298 Repsol Spa 25.043.30 78 104 19,145.90 19,379.10 239 287 Alltel US 24,723.30 673 233 6,302.30 5,194.00 240 Advantest Jap 24,519 90 936 332 1,372 00 2,492 20 241 123 Emerson Electric US 24,517.10 252 133 14,269.50 13,447.20 242 405 Industrial Bank of Japan Jap 24 328 40 875 N/R N/R 243 Sycamore Networks US 24,167.00 938 384 11.3 244 96 Halifax UK 24,16560 810 NIR NIR 245 291 Marsh & McLennan US 24,095.10 833 N/R N/R 246 136 Veba Ger 24,009.40 240 35 40,269.00 40,111.80 247 Unicredito Italiano Ita 23,965.00 810 N/R N/R 248 Equant Fra 23,896.30 673 342 723 7 529 1 249 342 Societe Generale Fra 23,806.40 810 N/R N/R 250 247 Broken Hill Proprietary Austl 23,579 50 48 153 12,596 00 13,879.90 251 472 Petrobras Brazil 23,528.10 78 183 9,742.70 10,521.10 252 Nikko Securties Jap 23,445.20 875 N/R N/R 253 Sakura Bank Jap 22,864.50 810 N/R N/R 254 135 Pharmacia & Upjohn US 22,624.50 480 218 6,893 00 6,710 00 255 257 Intl Paper US 22,412.00 156 101 19,541.00 20,096.00 — > 256 144 Abbey National UK 22,360 30 810 N/R N1R 257 307 Hang Seng Bank HK 22,217.50 810 N/R N/R 258 Echostar US 22,212.10 543 327 1,602.80 9827 Communications 259 Daiwa Securities Group Jap 22,150 30 875 " N/R N/R 260 Tokyo Electron Jap 22.057 50 936 292 3,038 20 4.410.70 261 Pacific Century HK 22,034.20 974 380 36.5 45.3 Cyberworks 262 269 Nintendo Jap 21,94500 535 244 5,54590 5,17620 263 206 National Australia Bank Austl 21,878.20 810 N/R N/R http://www.ft.com/specials/globa15002a.htm 8/8/00 FT.com - FT500 Page 6 of 10 264 382 Cable 8 Wireless UK 21,754 60 673 264 4,290 40 3,689 60 Comms 265 86 Monsanto US 21,735.30 118 214 7,237.00 7,51400 266 240 Gannett US 21.53510 547 251 5,12130 4.729.50 267 182 East Japan Railway Jap 21,338 00 596 83 24,044.90 24,347.10 268 125 BG UK 20,869.90 730 213 7,32360 8,75920 269 236 Fifth Third Bancorp US 20,705.10 810 N/R N/R 270 430 Korea Electric Power Korea 20.522 10 720 152 12,675 40 11.773.40 271 277 Denso Jap 20,447.00 313 117 17,028.20 16,142.00 272 254 MBNA US 20.395 70 873 N/R N/R 273 196 Tesco UK 20,233.80 630 54 30,767.7 28,0864 274 168 Endesa Spa 20.201.00 720 220 6,818.60 7,719 90 275 338 Lowes US 20,167.50 526 125 15,905.60 12,244.90 276 Invensys UK 20,088 60 267 128 15.410 10 6,007 90 277 337 Pearson UK 20,036.40 547 276 3,920.40 3,753.50 278 184 CGU UK 20,009.30 834 N/R N/R 279 467 Gateway US 19,941.70 932 195 8,645.60 7,467.90 280 362 First Data US 19,905 70 972 252 5,117 60 5,234 50 281 373 Seagram Can 19,678.00 538 171 11,614.90 9,080.80 282 141 Eastman Kodak US 19,672 90 546 135 14,089 00 13,406.00 283 Tecnost Ita 19,666.90 673 371 85.1 65.1 284 359 BAE Systems UK 19,659.30 215 172 11,527 30 11,895 60 285 Verisign US 19,485.50 977 372 84.8 38.9 286 288 News Corp Austl 19.402.20 543 134 14,263.10 12,412 60 287 Firstar US 19,373.10 810 N/R N/R 288 414 TDK Jap 19,329 20 345 229 6,547 10 6,744.90 289 315 Reuters Group UK 19,281.70 547 255 4,963.20 4,717.60 290 283 Suntrust Banks US 19,122.50 810 N/R N/R 291 336 Granada Group UK 19,056.00 535 228 6,598.50 6,696.70 292 367 Cap Gemini Fra 18,951 00 972 272 4,080 90 3,174.10 293 241 Morgan (J P) US 18,812 20 810 N/R N/R 294 495 Banca Intesa Ita 18,811.20 810 NIR NIS 295 286 BMC Software US 18,802,10 977 334 1,303.90 788.2 296 140 Sara Lee US 18,713 10 435 96 20,012 00 20,011 00 297 370 Costco Wholesale US 18,702.00 524 64 27,456.00 24,269.90 298 Micron Technology US 18,700 10 936 280 3,764.00 3,011 90 299 Development Bank of Sin 18,699.00 810 N/R N/R Singapore 300 222 Bridgestone Jap 18,510 20 317 94 20,192.90 21,654.50 301 84 Allstate US 18,322.80 834 MIR N/R 302 San Paolo-IMI Ita 18 322.70 810 N/R N/R 303 265 Illinois Tool Works US 18,306.80 266 185 9,333.20 5,647.90 -) 304 155 Associates First Capital US 18,206.10 873 MR N!R 305 Jafco Jap 18,200 60 873 N/R N/R 306 Shin-Etsu Chemical Jap 18,116.80 118 235 6,223.20 6,711.90 307 Bouygues Fra 18,114.40 137 129 15,260.50 14,327 20 308 165 RWE Ger 18,09890 240 46 32,36920 32,270.60 309 232 BMW Ger 18,098.50 311 44 33,292.00 31,711.60 -)310 294 Commerzbank Ger 18,051 40 810 N/R N/R 311 148 Duke Energy US 17,967.80 720 115 17,610.00 16,308.90 312 204 Ahold Net 17.949 60 630 65 27,314 60 23,666 40 313 Foundry Networks US 17,877.60 977 367 133.5 17 314 Asahi Bank Jap 17,781 70 810 N/R N/R 315 Ariba US 17,780.50 977 378 45.4 84 316 Takefuji Corp Jap 17,654.30 873 N/R N/R 317 159 Safeway US 17,553.60 630 80 24,484.20 22,483.80 318 Fax Entertainment US 17,544.00 535 204 8.057 00 7,023.00 Group 319 205 Full Photo Film Jap 17,537.80 546 136 13,920.10 13,341.70 http://www.ft.com/specials/globa15002a.htm 8/8/00 FT.com - FT500 Page 7 of 10 320 United Pan-Euro Net 17,518 00 543 363 191.3 157.8 Communications 321 223 Baxter International US 17,412.00 446 227 6,599.00 6,138.00 322 490 Mediaset lta 17,371 30 542 314 1,90810 1,75130 323 379 Kao Jap 17,336.60 477 192 8,951.40 8,783.50 324 220 Kansas Electric Power Jap 17,139 70 720 76 25.143 50 25,749.10 325 Yamato Transport Jap 17,055.30 596 212 7,432.00 7,274 20 326 Juniper Networks US 17,031.40 932 387 3 8 327 317 Saint Gobain Fra 17,025.10 132 107 18,390.30 16,845.00 328 Halliburton US 17,007 50 75 130 14,765 00 17,159 30 329 261 Tokio M.& F.Ins. Jap 16,968.80 834 N/R N/R 330 230 American General US 16,95840 840 N/R N/R 331 169 Electrabel Bel 16,911.80 720 239 6,12030 6,097.70 332 389 Cendant US 16,872 30 536 247 5,364 00 5,055 40 333 229 Caterpillar US 16,860.00 263 99 19,702.00 20,977.00 334 Turkiye Is Bank 'C' Tur 16,815.40 810 N/R N/R 335 357 Tele Danmark Den 16,793 00 673 258 4,708.50 4,016.80 336 189 Reed Elsevier Nuk 16,759 90 547 250 5,223 40 5,593 40 337 161 Volkswagen Ger 16,728.20 311 14 70,780 90 59,709.50 338 192 Danone Fra 16,725 90 435 143 13,349 50 13,918 60 339 Apple Computer US 16,635.30 932 238 6,134.00 5,941.00 340 496 Omnicom Group US 16.624.60 545 271 4,092 00 3,124,80 341 Thyssen Krupp Ger 16,555.30 266 55 30,728.20 342 Ebay US 16.555 30 974 377 47 4 5 7 343 200 Household International US 16,454.90 873 N/R N/R 344 Terra Networks Spa 16,388 20 974 379 40.7 345 290 Kroger US 16,322.10 630 62 28,203.30 26,567.30 346 260 Thomson Can 16,318.80 547 225 6,637 80 8,624 00 347 Red Hat US 16,306.10 977 385 10.8 5.2 - >348 478 Toronto Dominion Bank Can 16,263 80 810 N/R N/R 349 Canal + Fra 16,250.90 542 301 2,552.50 2,137.90 350 Standard Chartered UK 16,226 20 810 N/R N/R 351 129 U S Bancorp US 16,138 40 810 N/R N/R 352 Wipro India 15,987.60 977 354 426.2 3298 353 Commerce One US 15,772.60 977 381 33.6 2.6 354 349 3Com US 15,747.90 938 242 5.77210 5.42040 355 Singapore Airlines Sin 15,739.20 591 259 4,707.70 4,664.20 356 Asm Lithography Net 15.637 70 936 340 803 6 843 6 357 AMFM US 15,61550 542 313 1,977.90 1,273.90 358 391 Royal Bank of Scotland UK 15.593 90 810 N/R N/R Group (The) 359 284 Columbia/HCA US 15,522 70 444 123 16,657.00 18,681.00 Healthcare 360 440 Computer Sciences US 15,499 30 972 208 7,660 00 6,600 80 361 175 Southern US 15,481.10 720 174 11,403.00 12,611.00 362 388 Nippon Steel Jap 15,421 00 188 67 26,715 20 29,785.40 363 Nissan Motor Jap 15,402.40 311 17 63,704.10 63,555.40 364 Trend Micro Jap 15,380 50 977 368 133 98.9 365 199 Metro Ger 15,352.20 527 27 48,351.70 29,969.40 366 346 Commonwealtn Bank of Austl 15.324 40 810 N/R N/R Austraka 367 194 KBC Bankverzekenng Bel 15,322.60 810 N/R N/R 368 118 Xerox US 15,31990 932 102 19,449.00 18,16600 369 456 Weyerhaeuser US 15,310.10 153 158 12,262.00 10,766.00 370 156 Campbell Soup US 15,298 00 435 231 6,424.00 6.696 00 371 Analog Devices US 15,147.80 936 330 1,450.40 1,230.60 372 SMC Jap 15.11290 267 328 1,59810 1.910.90 373 224 CVS US 15,108.70 630 110 18,098.30 15,273.60 374 Exodus US 14,999.80 974 376 52 7 12 4 Communications http://www.ft.com/specials/globa15002a.htm 8/8/00 Forbes (7-24-00) Bullterrier Banking Page 1 of 2 FP 3iDL7 PERRTE CRPITRL_I SCCL Forbes +lukAiillittrthia August B, 2000 Forbes EgEomaiol Subscriber Services FORBESFINDERTM 'Search Term Forbes.com Entire Web Stocks 'symbol Market Detail Mutual Funds symbol Go! Symbol lookun Go! Go! Maaazines/Archives News Departments Letters to the Editor Forbes Lists Richest Americans Celebrity 100 Richest Worldwide 500 Comoanies Best Places more... Calculators Financial Tools Free Newsletter 'your email Go! Chat/Message Boards Contact Forbes.com Help ON THE COZIER July 24, 2000 Sir John Bond's disciplined focus on retail banking and execution arguably makes HSBC Holdings Plc. the world's best -run bank. Bullterrier Banking By Richard C. Morais Next SIR JOHN BOND, THE 59-YEAR-OLD chairman of HSBC Holdings Plc., sits under the sole personal memento in his London office --a photograph of "Gussy," his English bullterrier --and says, rather severely, "There are few original strategies in banking. There is only execution." So goes the watchword in servicing 23 million customers around the globe, in the most efficient of the world's top banks. Every dollar of income HSBC brought in last year cost it 54 cents, putting it well ahead of its one larger rival, Citigroup, at 68 cents. Last year it reported $6 billion in net income and its 20.8% five-year return on equity not only beats the other majors but also international competitors like Barclays (20.2%), ABN-Amro (17.8%) and Deutsche Bank (9.10/0). But these days famously frugal HSBC can claim something more surprising: It is quietly outperforming both Citigroup and Chase Manhattan in their home market. This defies the legendary warning from a Federal Reserve official who told foreign bankers, "Welcome. You are in the land of the free. You are free to own a handgun, and you are free to own a bank license. It is not clear which is more dangerous." Just a decade ago it looked like HSBC USA Inc. was going to join that bloodied heap of foreign banks. HSBC bought a $314 million stake in Marine Midland Bank of New York in 1980; seven years later, after local management ran amok, HSBC spent another $770 million taking full control. Marine Midland's losses totaled almost $300 million in 1990, and only in the mid-1990s--after Bond did some bloodletting --did it become profitable. "We had some very difficult years in the U.S.," says HSBC's Group Chief Executive Keith Whitson. Not anymore. After rebrandinq all its Marine Midland branches last http://www.forties.com/forbes/00/0724/6517068a.htm 8/8/00 Forbes (7-24-00) Bullterrier Banking Page 2 of 2 year, HSBC USA Inc. is the tenth -largest bank in the country, according to American Banker, and has more branches in New York State (430) than either Chase Manhattan (360) or Citibank (180). HSBC USA's New York State holding company soundly beats Chase's and Citi's on key profitability and efficiency benchmarks. Q to That doesn't mean skimping on service. In a June ranking of re customer satisfaction at U.S. banks, Consumer Reports placed HSBC third, well ahead of household names like Citi, Chase and Wells Fargo. "HSBC has a very strong management cadre," says Ian Woodhouse, a banking specialist at Pricewaterhouse-Coopers in London. "They're a bit like the GE of the financial sector." Next I back to top I Read more: .PRI CA • By Richard C. Morais • On the Cover • From July 24. 2000 Issue Home Sitemap Search Contact Us Reprints / Permissions Advertisers' Directory Ad Information © 2000 Forbes.com Terms. Conditions and Notices Privacy Statement http://www.forties.com/forbes/00/0724/6517068a.htm 8/8/00 City of Palm Desert Internal Correspondence Date: 30 August 2000 Subject: Additional Prospects for Approved Medium -Term Note List From: Thomas W. Jeffrey, Investment Manager TY To: Paul S. Gibson, City Treasurer Attached please find: • A list of 4 issuers of medium -term notes that have recently been qualified as prospects for the City's Approved List. • A Moody's Credit Ratings Guide. / am recommending that the Finance Committee approve the addition of the following firms to the Approved List for Medium -Term Notes: FIRM 1. Wells Fargo & Company 2. Associates Corporation NA 3. Northern Trust Corporation 4. , Proctor & Gamble PARENT COUNTRY United States United States United States United States Although the City's "Statement of Investment Policy" authorizes, under certain circumstances, the purchase of medium -term notes with maturities of up to five years, the risk position of the City in medium -term notes has traditionally been limited to three years or less. CITY OF PALM DESERT ADDITIONAL PROPOSED MEDIUM -TERM NOTE ISSUERS (1) SEPTEMBER 2000 BANK We/is Fargo & Company FINANCE Associates Corp NA Nationality: American Founded: 1918 Business: Subsidiary of Associates First Capital - largest finance company in U.S. Global consumer finance, commercial finance, leasing, and insurance services. Northern Trust Corp. Nationality: American Founded: 1889 Business: Global private and corporate trust company. Chicago -based and highly conservative. Highly profitable during 1930s Depression. HOUSEHOLD Proctor & Gamble Nationality: American Founded: 1837 Business: Largest maker of household products In U.S. Fortune 50 company with global operations. Page 1 of 1 Moody's MTN Rating Aa3 Aa3 Al Aa2 (1) Maximum maturity of "A" MTNs is 2 years; "AA" MTNs 3 years; and "AAA" MTNs 5 years. City of Palm Desert Internal Correspondence Date: 30 August 2000 Subject: Investment Ranking of City of Palm Desert From: Thomas W. Jeffrey, Investment Manager 14 To: Paul S. Gibson, City Treasurer Attached please find three lists of California cities, special districts, and counties that are ranked by investment portfolio size as of 30 June 2000. All figures reflect book value (amortized cost). This information was obtained from the California Municipal Treasurers's Association and from the 58 California County Treasurers's Offices. Cities The City of Palm Desert ("City") has the l lth largest investment portfolio (38tt' percentile) in California. Special Districts If the City were a special district, then it would have the 7`6 largest investment portfolio (39th percentile) in California. Counties If the City were a county, then it would have the 26tb largest investment portfolio (45t`' percentile) investment portfolio in California, out of 58 counties. Attachments: 1) California Municipal Investment Portfolios 2) California Special District Investment Portfolios 3) California County Investment Portfolios 8/30/00 313 PM ($ millions) CALIFORNIA MUNICIPAL INVESTMENT PORTFOLIOS As of 30 June 2000 Portfolio Size Rank Municipality (Book Value) 1 Los Angeles 3,500 2 San Francisco 2,722 3 San Diego 1,400 4 Sacramento 1,000 5 San Jose 1,000 6 Anaheim 900 7 Long Beach 850 8 Irvine 500 9 Santa Clara 460 10 Santa Monica 345 11 Palm Desert 320 _ 12 Pasadena 300 13 Carlsbad 300 14 Palo Alto 279 15 Glendale 275 16 Fresno 275 17 Cerritos 220 18 Oakland 180 19 Rancho Cucamonga 180 20 Ventura 145 21 Corona 135 22 Bakersfield 125 23 Orange 122 24 Pleasanton 120 25 Ontario 115 26 Oceanside 115 27 Santa Barbara 110 28 Escondido 100 29 Redding 100 Source: California Municipal Treasurers's Association 8/30/00 CALIFORNIA SPECIAL DISTRICT INVESTMENT PORTFOLIOS As of 30 June 2000 3:15 PM ($ millions) Portfolio Size Rank Special District (Book Value) 1 MWD 1,000 2 Sacramento Municipal Utility District 757 3 East Bay Municipal Utility District 353 4 San Diego County Water Authority 343 5 Orange County Sanitation District 325 6 Irvine Ranch Water District 325 7 City of Palm D_es_ert 320 8 Eastern Municipal Water District 309 9 Port of Los Angeles 300 10 Santa Clara Valley Water District 250 11 Contra Costa Water District 250 12 Sacramento County Sanitation District 236 13 Coachella Valley Water District 200 14 Modesto Irrigation District 190 15 Port of San Diego 180 16 Rancho California Water District 140 17 Turlock Irrigation District 120 18 Imperial Irrigation District 100 Source: California Municipal Treasurers's Association 8/30/00 3:21 PM ($ millions) CALIFORNIA COUNTY INVESTMENT PORTFOLIOS As of 30 June 2000 Portfolio Size Rank County (Book Value) 1 Los Angeles 10,215 2 Orange 3,208 3 Santa Clara 3,036 4 San Francisco 2,722 5 San Diego 2,271 6 San Bernardino 2,000 7 Alameda 1,701 8 Sacramento 1,533 9 Riverside 1,518 10 Contra Costa 1,338 11 San Mateo 1,245 12 Kern 1,233 13 Fresno 1,200 14 Ventura 987 15 San Joaquin 800 16 Sonoma 790 17 Santa Barbara 580 18 Santa Cruz 501 19 Monterey 501 20 Stanilaus 483 21 Tulare 441 22 Marin 370 23 San Luis Obispo 360 24 Placer 350 25 Merced - 325 26 City of Palm Desert 320 27 Solano 269 28 Napa 226 29 Butte 225 30 El Dorado 174 31 Imperial 164 32 Yolo 156 33 Madera 156 34 Kings 143 35 Humboldt 135 36 Yuba 121 Source: California County Treasurers's Offices Page 1 8/30/00 3:21 PM ($ millions) CALIFORNIA COUNTY INVESTMENT PORTFOLIOS As of 30 June 2000 Portfolio Size Rank County (Book Value) 37 Shasta 111 38 San Benito 109 39 Sutter 99 40 Mendocino 93 41 Nevada 75 42 Tehama 73 43 Amador 61 44 Tuolumne 59 45 Calaveras 59 46 Lake 55 47 Lassen 51 48 Siskiyou 50 49 Plumas 41 50 Inyo 38 51 Glenn 38 52 Del Norte 26 53 Trinity 23 54 Mono 18 55 Mariposa 18 56 Colusa 17 57 Alpine 13 58 Modoc 12 59 Sierra 12 Source: California County Treasurers's Offices Page 2 CITY OF PALM DESERT 2000 BROKER RFI LIST 1. Merrill Lynch John H. April, Jr. Vice President, Institutional Services 101 California Street, Suite 1400 San Francisco, CA 94111 2. Securities America, Inc. Douglas C. Robinson Branch Manager/Registered Principal 3516 Sacramento Street San Francisco, CA 94118 Submitted Ann (8-17-00) No Response City of Palm Desert Internal Correspondence Date: 13 September 2000 Subject: Approval of Merrill Lynch as a Broker -Dealer From: Thomas W. Jeffrey, Investment Manager if To: Members of the Finance Committee Recommendation That Merrill Lynch & Company, Inc. be approved as a broker -dealer for the City of Palm Desert. Background Last year, in the course of verifying Lehman Brothers's references, I found that a number of prominent California public agencies had a high opinion of the brokers in Merrill Lynch's Corporate and Institutional Client Group in San Francisco. In particular, John April, a Merrill Lynch Vice President, was rated very highly by LAIF, the City of Los Angeles, and the Counties of Los Angeles, San Diego, and Sacramento. Merrill Lynch's San Francisco Group apparently does not include anyone who was associated with the 1995 Orange County bankruptcy. When I attended the California Municipal Treasurers's Conference in Concord last April, I made a point of paying a courtesy call on John April in San Francisco for the purpose of scouting Merrill Lynch as a prospect. It was during this visit that I learned that Union Bank Capital Markets Group ("UBOC"), which is the City of Palm Desert's ("City") primary source of corporate securities, is one of Merrill Lynch's biggest customers. Thus, when the City places an orderwith UBOC for a corporate security, UBOC frequently turns around, purchases it from Merrill Lynch, marks it up, and resells it to the City. Merrill Lynch has the largest securities inventory in the world. UBOC recently failed to requalify as a broker -dealer for the City because it did not provide the necessary information, despite three requests by the City. Apparently, UBOC no longer wanted to carry the cost of special liability insurance for securities transactions with the City in which UBOC might sell and then clear the same security. Unfortunately, UBOC's termination creates a gaping hole in the City's program to buy corporate securities, particularly with respect to commercial paper, which is used to invest bond proceeds. Aooroval of Merrill Lvnch as a Broker -Dealer 13 September 2000 Page 2 of 3 Accordingly, when I recently conducted a qualification for new broker -dealers, I invited Merrill Lynch to submit an application, with the idea of eliminating the middle man and broadening the corporate securities offerings available to the City. Merrill Lynch promptly responded. Merrill Lynch was an authorized broker -dealer for the City of Palm Desert from 1992 through 1996. The City did a heavy volume of securities trading with Merrill Lynch, principally in U.S. Treasury notes and strips. The relationship was completely satisfactory from the City's standpoint. In the wake of Orange County, however, the Merrill Lynch Law Department tightened up on information disclosure, and, accordingly, in 1996, Merrill Lynch failed to requalify as an authorized broker - dealer for the City because it could not provide the necessary information. Merrill Lynch is currently the largest securities firm in the United States. It has offices in 43 countries, total assets of $1.7 trillion, and is the No.1 global underwriter and market maker of debt and equity securities. Merrill Lynch's SEC Rule 15c3-1 net capital position is approximately $3.4 billion. It did not report any political contributions in California in its most recent MSRB Form G-37/G-38 filing. According to Merrill Lynch's 1999 Annual Report, there is currently no pending litigation that threatens the company's financial condition. Over the last 23 years, the majority of regulatory violations in Merrill Lynch's Form BD — Uniform Application for Broker -Dealer Registration relate to missed filing deadlines, reporting omissions, violated exchange rules, lapsed brokerage licenses, etc. These violations reflect a sales culture that assigns less importance to paperwork. With respect to Orange County litigation, according to Merrill Lynch's 1999 Form 10-K, Merrill Lynch settled City of Atascadero et al. v. Merrill Lvnch, Pierce, Fenner & Smith Inc.. et al., an action brought by 14 California public agencies, for $32.5 million on 3 March 2000. DeLeon v. Merrill Lvnch, Pierce, Fenner & Smith Inc. et al., a class action brought by individuals whose funds were invested by the Orange County Treasurer -Tax Collector, was dismissed without any payment of damages by Merrill Lynch. The only outstanding Orange County litigation is Balan v. Merrill Lvnch & Co., Inc., et al., a New York action brought by Merrill Lynch shareholders over a failure to disclose. A motion to dismiss is currently pending. Approval of Merrill Lynch as a Broker -Dealer 13 September 2000 Page 3 of 3 If Merrill Lynch were approved as a broker -dealer, then Derek Hyatt, a young account executive with a business degree from Lehigh University and four years of experience with the Corporate and Institutional Client Group in San Francisco (no NASD complaint history -- see Exhibit A), would be the primary account contact. I met Hyatt when I visited the San Francisco office. John April, who is a 22-year Merrill Lynch veteran (no NASD complaint history -- see Exhibit B), would be the secondary account contact. Although Merrill Lynch did not provide any references on its application, this omission should be viewed within the context of Merrill Lynch's recent litigation experience over Orange County. The Merrill Lynch Law Department currently has such a tight grip on information disclosure that the San Francisco office could not even fill out the City's application without first obtaining the New York Law Department's permission. As a practical matter, this omission of references should not impede approval by the City, since the City basically collected references from five prominent state, city, and county agencies prior to contacting Merrill Lynch. Fiscal Impact The addition of Merrill Lynch as a broker -dealer should enhance portfolio profitability by: (1) enlarging the range of corporate securities that can be purchased; (2) lowering the acquisition cost of securities through the elimination of a middle man; and (3) promoting lower securities prices in competitive offerings. cc: Paul Gibson, City Treasurer Attachments: (1) Exhibit "A" (2) Exhibit "B" Document Title Page 1 of 1 EXHIBIT "A" File for: CRD# 2445389 DEREK DOUGLAS HYATT Disclosure Events No disclosure information exists for this broker. Data Current as of: 09/14/2000 Disclosure Events: Information that is required to be reported to the NASD by brokers via Form U-4 (Uniform Application for Securities Industry Registration or Transfer) and firms via Form BD (Uniform Application for Broker -Dealer Registration). Some disclosure events may have multiple reporting sources. For example, some information required to be reported by a broker via Form U-4 may also be reported on the broker's record by a firm via Form U-5 (Uniform Termination Notice for Securities Industry Registration) and/or by a regulator via Form U-6 (Uniform Disciplinary Action Reporting Form). If a disclosure event is reported by multiple sources, all versions of the reported event will be disclosed on the broker's public disclosure report. Similarly, some information required to be reported by a broker -dealer firm via Form BD may also be reported on the firm's record via Form U-6. If a disclosure event is reported by multiple sources, all versions of the reported event will be disclosed on the firm's public disclosure report. Types of Disclosure information include, but are not limited to: • criminal events (e.g., felony convictions, certain misdemeanor charges and convictions, such as theft of money, bribery, etc.) • financial disclosure events (e.g., bankruptcies, unsatisfied judgments and liens), • regulatory actions (e.g., suspensions, bars), • customer complaints, and • civil judicial events (e.g., injunctions). http://pdpi5.nasdr.com.../display.asp?Subj ectID=24453 89&SubjectType=I&DisclosureType=1 9/14/00 Document Title Page 1 of 1 EXHIBIT "B" File for: CRD# 6708 JOHN HENRY APRIL JR Disclosure Events No disclosure information exists for this broker. Data Current as of: 09/14/2000 Disclosure Events: Information that is required to be reported to the NASD by brokers via Form U-4 (Uniform Application for Securities Industry Registration or Transfer) and firms via Form BD (Uniform Application for Broker -Dealer Registration). Some disclosure events may have multiple reporting sources. For example, some information required to be reported by a broker via Form U-4 may also be reported on the broker's record by a firm via Form U-5 (Uniform Termination Notice for Securities Industry Registration) and/or by a regulator via Form U-6 (Uniform Disciplinary Action Reporting Form). If a disclosure event is reported by multiple sources, all versions of the reported event will be disclosed on the broker's public disclosure report. Similarly, some information required to be reported by a broker -dealer firm via Form BD may also be reported on the firm's record via Form U-6. If a disclosure event is reported by multiple sources, all versions of the reported event will be disclosed on the firm's public disclosure report. Types of Disclosure information include, but are not limited to: • criminal events (e.g., felony convictions, certain misdemeanor charges and convictions, such as theft of money, bribery, etc.) • financial disclosure events (e.g., bankruptcies, unsatisfied judgments and liens), • regulatory actions (e.g., suspensions, bars), • customer complaints, and • civil judicial events (e.g., injunctions). http://pdpi5.nasdr.com/pdpi/display.asp?SubjectID=6708&SubjectType=l&DisclosureType=19 9/14/00 CITY OF PALM DESERT BROKER -DEALER REQUEST FOR INFORMATION 2000 PREPARED BY THE CITY FINANCE DEPARTMENT Thomas W. Jeffrey, J.D., M.B.A. Investment Manager REVIEWED AND APPROVED BY Paul S. Gibson, C.C.M.T.- City Treasurer (CANDIDATE: MERRILL LYNCH & COMPANY 1 SECTION I: STATEMENT OF POSITION AND GENERAL REQUIREMENTS The City of Palm Desert, the Palm Desert Redevelopment Agency, and the Palm Desert Housing Authority (hereafter referred to collectively as the "City") are local governmental agencies that operate under the laws of the State of California. The City manages a portfolio with a combined book value of approximately $300 million, which includes United States Treasury and Agency obligations, corporate obligations, and selected money market instruments. The City has adopted a written "Statement of Investment Policy" which governs the operation of its investment program. A copy of this document is enclosed. The City annually reviews Requests for Information ("RFI") which are completed and submitted by broker -dealers that wish to qualify as authorized providers of financial services to the City. The City will notify all broker -dealer candidates, in writing, on whether their request for such status has been approved or denied. If a candidate's request is denied or if its RFI is rejected for being incomplete or late, then that candidate shall not be eligible to reapply for three years. Regional broker -dealers shall be eligible for consideration as authorized providers of financial services to the City only if they: 1. Have a net capital position in excess of $100 million; 2. Have been in existence for more than five years; 3. Are currently licensed as a broker -dealer by the State of California; and 4. Are headquartered or have a branch office in California. The City shall not transact business with an authorized broker -dealer until all of the documentation that both parties require, has been executed and delivered. SECTION II: APPLICATION DEADLINE AND REQUIRED DOCUMENTS The City must receive the following documents from each broker -dealer candidate by no later than 4:30 p.m. on Monday, 21 August 2000: A completed "Broker -Dealer Request For Information". A copy of the firm's most recent Annual Report and Form 10-K. City of Palm Desert 2000 Broker -Dealer RFI Page 2 of 8 A copy of the firm's Form BD - Uniform Aoolication for Broker -Dealer Reaistration. A copy of the firm's most recent Form BD Status Report. A copy of the Form U-4 - Uniform Aoolication for Securities Industry Registration or Transfer for each employee with whom the City would be trading. A copy of the most recent Form U-4 Status Report on each firm employee with whom the City would be trading. A copy of the firm's most recent SEC Form X-17 A-5 filing or, in the case of a trading department within a commercial bank, its most recent Consolidated Reports of Condition and Income for A Bank With Domestic and Foreign Offices - FFIEC 031 filing. A resume on each firm employee with whom the City would be trading. A trading resolution from the firm. A copy of the firm's wiring and delivery instructions. Samples of research reports or market information that the firm regularly provides to public sector clients. Samples of the firm's trade documentation. These documents may be delivered in person, by post, or by courier to: City of Palm Desert Attention: Thomas W. Jeffrey Investment Manager 73-510 Fred Waring Drive Palm Desert, CA 92260-2578 If a broker -dealer candidate fails to submit the above -referenced documents by the specified deadline, then its RFI shall be deemed to have been automatically reiected by the City. That candidate shall not be eligible to reapp&forthree years. If you have any questions about this RFI, then please call Mr. Jeffrey at 760.346.0611, extension 383. Citv of Palm Desert 2000 Broker -Dealer RFI Page 3 of 8 SECTION III: REQUEST FOR GENERAL INFORMATION FROM BROKER -DEALER CANDIDATE 1. Firm Name: 2. Contact Address: 3. Contact Personnel: Sales Representative Merril Lynch & Company, Inc. 101 California Street, # 1400, San Francisco, CA 94111 Supervising Manaaer Name: Derek Hyatt Name: Paul Schulte Title: Account Executive Title: VP/Resident Manager TEL: (415) 274-7416 TEL: (415) 274-7424 TEL: (800) 477-0102 TEL: (888) 519-5588 4. Please identify all personnel who would be trading with or quoting securities prices to the City. Name # of Years in # of Years Title Institutional Sales with Firm Telephone Derek Hyatt Account Executive 6 4 415.274.7416 John April Vice President 20+ 20+ 415.274.7426 Please provide information on the history, details, and status or disposition of any disciplinary actions or complaints, arbitration, or litigation involving the above personnel. See attached (none). 5. Which of the personnel who are listed in Question 4 have read the City's "Statement of Investment Policy", as amended 10 June 1999? Both. 6. Please describe any formal program of supervision that your firm has established for the sales representative who is listed in Question 3. Audits. By corporate audit, compliance department Daily review of desk trading and that of employee -related accounts. 7. Please provide four references from California public sector clients that have established relationships with the sales representative who is listed in Question 3. Indicate: (a) name of governmental agency; (b) contact person; (c) address; (d) telephone number; and (e) length of relationship. Merrill Lynch generally does not give out such information without the written consent of the client, in order to maintain the integrity of our relationship. NASD Broker Search Page 1 of 1 There is 1 broker that meets your search criteria. Click on the name of the Broker to review the File. Broker's Personal Currently Approved Information Registrations with: DEREK DOUGLAS HYATT CRD #2445389 AK, AMEX, CA, CBOE, NASD, NY, NYSE, OR, PCX, PHLX, WA Current Employment with NASD Member Firm(s) • MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED NEW YORK , New York Previous Employment rt. vv. NKtbs Kie & GU., INC. -: http://pdpi6.nasdr.com/pdpi/broker_match.asp 8/17/00 Broker Category Page 1 of 1 Public Disclosure Program Online Broker File Contents IbEmployment History DiCurrent (1) OPrevious (3) DRegistrations (11) (bDisclosure Events:No View Description of Broker Category http://pdpi6.nasdr.com/pdpi/contents.asp?SubjectType=l&Subject=2445389 8/17/00 NASD Broker Search Page 1 of 1 There is 1 broker that meets your search criteria. Click on the name of the Broker to review the File. Broker's Personal Information JOHN HENRY APRIL JR CRD #6708 Currently Approved Registrations with: AK, AL, AMEX, AZ, CA, CBOE, CO, DC, DE, FL, GA, HI, ID, IL, IN, KS, KY, LA, MA, MD, MI, MN, MO, MT, NASD, NC, ND, NH, NJ, NM, NV, NY, NYSE, OH, OK, OR, PA, PCX, PHLX, RI, SC, TN, TX, UT, VT, WA, WI, WY Current Employment with NASD Member Firm (s) MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED NEW YORK , New York http://pdpi6.nasdr.com/pdpi/broker_match.asp 8/17/00 Broker Category Page 1 of 1 Public Disclosure Program Online Broker File Contents 'Employment History CiCurrent (1) I Previous (0) MRegistrations (52) Disclosure Events:No View Description of Broker Category http://pdpi6.nasdr.com/pdpi/contents.asp?SubjectType=I&Subject=6708 8/17/00 City of Palm Desert 2000 Broker -Dealer RFI Page 4 of 8 8. Is your firm: (check one) D A Dealer ❑ A Broker Q A Broker/Dealer 9. Does your firm regularly report to the Market Reports Division of the Federal Reserve Bank of New York as a "primary dealer"? (check one) 7Yes ❑ No If yes, how long has your firm been a primary dealer? Since inception. 10. Please answer the following questions only if your firm IS NOT a primary dealer. a. Does your firm have a net capital position in excess of $100 million? (check one) ❑ Yes ❑ No b. Has your firm been in existence for more than five years? (check one) ❑ Yes 0 No c. Is your firm currently licensed as a broker -dealer by the State of California? (check one) ❑ Yes ❑ No d. Is your firm headquartered or does it have a branch office in California? (check one) ❑ Yes ❑ No 11. Is your firm a member of the National Association of Securities Dealers? (check one) dYes ❑ No If "no", why not? 12. Which of the following entities has the authority to oversee the operation of your firm, in terms of examinations, rules, and regulations? (check appropriate choices) City of Palm Desert 2000 Broker -Dealer RFI Page 5 of 8 FDIC /EC [lNYSE ❑ Comptroller of Currency Lederal Reserve System &NASD ❑ Other (example: state regulatory agency) (specify) 13. Is your firm owned by a holding company? (check one) Yes ❑ No If "yes", what is the holding company's name and its market capitalization? Merrill Lynch & Co., Inc./ $55 billion. 14. Has your firm consistently complied with the Federal Reserve Bank's capital adequacy guidelines? (check one) 1Q/Yes ❑ No If "no", please explain. 15. What was your firm's total volume in United States Treasury and Agency securities trading last year? By the volume and size of our trading, these figures are not available. Firm -Wide: $ Your Office: $ # of Transactions: # of Transactions: 16. Which of the following instruments are regularly offered by your trading desk? (check appropriate choices) [[t�T-Bills ❑ Bankers's Acceptances (Domestic) 2 T-Notes ❑ Bankers's Acceptances (Foreign) 2T-Strips E<ertificates of Deposit [V Repurchase Agreements commercial Paper ❑ Reverse Repo Agreements [Corporate Medium -Term Notes [Agencies (Most) Q<Vloney Market Mutual Funds 17. Which of the financial instruments that are described in Question 16 does your firm specialize in marketing? Equal emphasis on all. City of Palm Desert 2000 Broker -Dealer RFI Page 6 of 8 18. Please describe the capital line and trading limits of the branch office of your firm that would be trading with the City. The branch office has none -- the full faith of MLPF&S (MLGSI) is global. 19. Is your firm a member of the Securities Investor Protection Corporation ("SIPC" )? (check one) MLPF&S is; MLGSI is not. 20. If "no" to Question 19, does your firm participate in any program that provides securities insurance coverage for a public sector client which buys the financial instruments that are listed in Question 16, on a delivery -versus - payment ("DVP") basis? (check one) ❑ Yes 27No If "yes", please explain. 21. If "no" to Question 20, please explain why your firm does not carry any securities insurance coverage for its customers. It does, but not for government securities transactions. 22. Please indicate a percentage breakdown of your firm's client base by portfolio size. See prospectus. 23. How many and what percentage of your securities transactions failed last month? Last year? See prospectus. 24. What precautions does your firm take to protect the interests of the public when dealing with public sector clients as investors? See Attachment A. 25. What trade documentation (e.g., transaction information, confirmations, statements, etc.) would your firm provide to the City? DTC ID confirms; mailed confirms; Bloomberg confirms, if requested. 26. What portfolio information, if any, does your firm request from its public sector clients? Investment policy, authorization to trade. 27. What makes your firm the best broker/dealer for the City? What advantage would the City gain by trading with your firm? Merrill Lynch is consistently one of the top five dealers in most security markets. City of Palm Desert 2000 Broker -Dealer RFI Page 7 of 8 SECTION IV: REQUEST FOR BROKER -DEALER CANDIDATE DISCLOSURE (2-8. Have any of your firm's public sector clients sustained a loss on a securities transaction within the last five years, arising from a misunderstanding or misrepresentation of the risk characteristics of a financial instrument that was recommended by and purchased through your firm? (check one) ❑ Yes ❑ No If "yes", please describe each matter briefly. 29. Have any of your firm's public sector clients claimed, in writing, within the last five years, that your firm was responsible for any investment losses? (check one) ri Yes ❑ No If "yes", please describe each matter briefly. 30. Has your firm been subject to any litigation, arbitration, or regulatory proceedings, either pending, adjudicated, or settled, within the last five years, that involved allegations of improper, fraudulent, disreputable or unfair activities related to the sale of securities to or the purchase of securities from institutional clients? (check one) ❑ Yes ❑ No If "yes", please describe each matter briefly. 31. Has your firm been subject to a regulatory, state, or federal agency investigation, within the last five years, for alleged improper, fraudulent, disreputable, or unfair activities related to the purchase or sale of securities? (check one) ❑ Yes ❑ No If "yes", please describe each matter briefly. SECTION V: CERTIFICATION We have read and 1E2E1E1 understand the investment policies and objectives of the City of Palm Desert, the Palm Desert Redevelopment Agency, and the Palm Desert Housing Authority (hereafter referred to collectively as the "City"), as represented in the City's "Statement of Investment Policy", as amended 10 June 1999. My firm will ensure that all affected sales personnel will be routinely City of Palm Desert 2000 Broker -Dealer RFI Page 8 of 8 informed of the City's investment objectives, horizon, constraints, as the City provides such information. My firm will notify the City Treasurer immediately, by the event of a material adverse change in its financial of Municipal Securities Rulemaking Board Rule G-37. outlook, strategies, and risk or otter elec4ren.,: dbw'',.,aicai;a•. telephones t' in writing, inPik cable. condition, or of any violation My firm pledges to exercise duc diligence in info.:rrrc.g the City Treasurer of all with tho City, I attest to the accuracy of my firm's response to the City's Request For Information. NOTE: Completion of this Request For Information is only part of the City of Palm Desert's review process, and DOES NOT guarantee that the candidate will be authorized to provide financial services to the City. This section must be signed by the sales representative who is listed in Question, 3. Signed: A/L e Firm: Merr•:II LA-e -1— Co, , 11-GCo✓t.T GXGGv1.4 11/i}/00 This section must be countersigned by the Managing Director or by the most senior person in charge of the government securities operations section. Title: Date: Firm: Signed: Title: Date: t'Z s/oo Attachment A Apart from requesting that public funds clients complete our trading authorization form or similar document, Merrill Lynch is subject to the federal securities laws and a host of rules and regulations thereunder whose primary purpose is investor protection. Merrill Lynch, however, expects that its institutional clients shall take responsibility for ensuring that its investments are consistent with the laws or investment policies to which the client is subject. Attachment B Yes. Given the length of time Merrill Lynch has been in business, its significant number of public sector clients and that securities necessarily fluctuate in value, and sometime by wide margins, it can generally be expected that public sector clients, at various points in our history, have sustained losses from their investments and have written claims in respect thereof. In addition, given the performance of fixed income markets in recent years, it can be reasonably expected that clients, including public funds clients. may have sustained losses of more than 10% of an original purchase price. Any material litigation, arbitration or regulatory proceedings within the last five years would have been disclosed in Merrill Lynch & Co. Inc.'s financial statements as required to be filed for each of the last five years with the SEC. Additional information is set forth on Form BD, broker -dealer registration form filed by Merrill Lynch with the SEC and the appropriate authority in the State of California. Copies of these items can be forwarded upon request. Specialized Institutional Group Merrill Lynch August 16, 2000 Mr. Thomas W. Jeffrey Investment Manager City of Palm Desert 73-510 Fred Waring Drive Palm Desert, CA 92260-2578 101 California Street Suite 1400 San Francisco, California 94111 415 274 7400 800 477 0102 FAX 415 274 1511 Subject: Investment Policy for the City of Palm Desert ("Palm Desert") Dear Mr. Jeffrey: This is to acknowledge that I, along with Derek Hyatt of our San Francisco Office, have reviewed the current Investment Policy for the City of Palm Desert (the "Investment Policy"). We are appreciative that you have provided us with a copy of the Investment Policy. However, our review of the Investment Policy does not relieve Palm Desert of the primary responsibility for determining whether a particular investment meets the terms of the Investment Policy or meets the laws to which Palm Desert and the City Treasurer are subject. While we agree to make reasonable efforts to offer investments that comply with our general understanding of the Investment Policy, we are not in a position to know Palm Desert's portfolio as a whole nor are we in a position to apply all of the terms of the Investment Policy to specific investments purchased through Merrill Lynch. Given the foregoing, and that Merrill Lynch may be only one of several firms executing orders for Palm Desert, the investment of public funds in accordance with the laws to which Palm Desert and the City Treasurer are subject, and with the Investment Policy, shall remain, as consistent with applicable law, the sole responsibility of the City Treasurer and the representatives of his office. Very truly yours, Jim Dullanty Senior Vice President cc: Derek Hyatt City of Palm Desert Internal Correspondence Date: 8 September 2000 Subject: Guaranteed Investment Contracts From: Thomas W. Jeffrey, Investment Manager 11 To: Finance Committee Recommendation That the City of Palm Desert and the Palm Desert Redevelopment Agency not use guaranteed investment contracts to invest bond proceeds, due to increased credit risk, decreased liquidity, and a loss of leverage in generating cash. Background Peggy Eckroth, Executive Vice President of Autumn Capital Investment Services, and Mike Thomas, Business Development Manager of MuniFinancial, recently approached the City Treasurer's Office about investing City and RDA bond proceeds in guaranteed investment contracts ("GICs"). Autumn Capital and MuniFinancial, although independently owned, have a "strategic alliance" under which they have a 50/50 fee -sharing arrangement for any GICs that they sell. Eckroth and Thomas reviewed outstanding City and RDA bond issues and identified Assessment District 98-1 (The Canyons at Bighorn), Series 1998, as the only viable candidate, at this time, for a GIC, based upon negative arbitrage. They requested that their firms be considered for future bond issues. A GIC is a contract between a bond issuer (e.g., City and RDA) and a provider (e.g., insurance company) that an intermediary (e.g., Autumn Capital) procures through competitive bidding while serving as a bidding agent. GICs provide a guaranteed interest rate; withdrawal at par; and a transfer of market price risk and reinvestment rate risk to the provider. GICs are guaranteed by the issuing insurance company -- not by the government. GICs are typically used to reduce "negative arbitrage" and to earn "positive arbitrage", whenever possible, in bond funds. Negative arbitrage occurs when investment yield is lower than the borrowing cost of the bond proceeds in the fund. Positive arbitrage occurs when investment yield exceeds the borrowing cost of the bond proceeds in the fund. Although federal tax law generally prohibits tax-exempt issuers from retaining positive arbitrage earnings, positive and negative arbitrage may offset each other from fund to fund and over time (for the life of the bond Guaranteed Investment Contracts 8 September 2000 Page 2 of 3 issue). Consequently, there may be an opportunity to earn and retain positive arbitrage. GICs have traditionally been marketed as uncollateralized obligations of the issuing insurance company. After three large insurance companies defaulted on their GICs in the early 1990s, collateralization and credit enhancement features became available as options. Collateralization can decrease yield by as much as 35 basis points (0.35%). A full liquidity feature (immediate access to all monies) can decrease yield by five basis points (0.05%). GIC contracts are not standardized and, consequently, great attention must be paid to their structure. There are no secondary markets for GICs. Collateralization and credit enhancement measures occasionally fail. In 1997, 75 Pennsylvania school districts lost $71 million through collateralized investment agreements, due to fraud and misrepresentation. A credit enhancement measure known as a "Downgrade Provision", which is used for uncollateralized GICs, can also fail if an insurer's financial condition deteriorates so rapidly that a credit downgrade and subsequent delivery of collateral or liquidation at par is not possible, due to a lack of notice prior to default. Even if a credit downgrade is done in a timely manner, it may inhibit subsequent collateralization. If the City and the RDA were to use GICs, then collateralization and full liquidity would be necessary features. U.S. Treasury securities would be the collateral of choice (the safest due to full faith and credit backing). Based upon figures provided by Autumn Capital, as of 28 August 2000, the estimated yield of a collateralized GIC for a construction fund would be as follows: Average Gross Yield 6.70% Less: Charge for US Treasury Collateral 0.35% Less: Charge for Full Liquidity 0.05% Less: Maximum Bidding Agent Fee 0.05% Less: Provider's Legal Costs Unknown Net Yield 6.25% During the same period, the AIM Prime Money Market Fund, which the Finance Committee recently approved for the investment of bond proceeds, would have provided the City and the RDA with an annualized 30-day yield of 6.31%. Guaranteed Investment Contracts 8 September 2000 Page 3 of 3 GICs would have an unfavorable effect on portfolio diversification. There would be a total concentration of credit risk in one insurance company, as opposed to a dilution of credit risk in a myriad of blue-chip companies in a diversified money market fund. Additionally, if an insurance company were to default on a collateralized GIC, then the City and the RDA would be exposed to reinvestment rate risk. Liquidity problems might also arise. Autumn Capital indicated that, even with a full liquidity option, the City and the RDA would be able to withdraw all of the bond proceeds invested in a GIC only after one-half of the estimated average life of the underlying project had passed. Fiscal !mulct In the case of construction funds, it is difficult to quantify whether the use of GICs would significantly reduce negative arbitrage, due the unpredictability of draws and the relatively short average life of construction funds. Unpredictable withdrawals of substantial amounts of cash could undermine the advantage of a guaranteed interest rate, the greatest selling point of a GIC. In the case of debt service reserve funds ("DSRF"), a stronger case can be made that GICs would significantly reduce negative arbitrage, due to the longer duration of DSRFs and the likelihood that they would not be accessed. Unfortunately, in the case of Assessment District 98-1, only 17% of that district's negative arbitrage is in the DSRF. Furthermore, any yield improvement would have to be balanced against a partial loss of full liquidity and the retention of cash that could otherwise be freed for other uses through the purchase of a surety bond. Overall, the fiscal benefits of GICs for Assessment District 98-1 are questionable since 83% percent of that district's negative arbitrage is in the construction fund, which, as indicated above, is the least effective vehicle for a GIC. cc: Paul Gibson, City Treasurer 77-7 ,AB 943 Assembly Bill - Bill Analysis Page 1 of 4 SENATE LOCAL GOVERNMENT COMMITTEE Senator Richard K. Rainey, Chairman BILL NO: AB 943 AUTHOR: Dutra VERSION: 6/13/00 HEARING: 6/21/00 FISCAL: Yes CONSULTANT: Swenson LOCAL INVESTMENT REPORTS Background and Existing Law In 1981, the Legislature created the nine -member California Debt Advisory Commission in the State Treasurer's Office. The Commission is the State's clearinghouse for state and local debt issuance information and monitors the issuance and management of public debt in California. The Legislature later required the Commission to track the issuance of all public refunding and revenue bonds, as well as compile fiscal information on Mello -Roos districts and other types of municipal bond sales. Following several local financial disasters, most notably the Orange County bankruptcy in 1994, the Legislature added education and oversight of local investment practices to the Commission's range of responsibilities (AB 1197, Takasugi, 1996). At that time, the Commission's name was changed to the California Debt and Investment Advisory Commission (CDIAC). In addition, the Legislature required local treasurers to provide quarterly investment reports as well as an annual statement of investment policy to their legislative body (SB 564, Johnston, 1995). To keep pace with current local investment policies and to provide beneficial information regarding investment policies and practices, CDIAC wants the necessary data to track local agency investment practices. Proposed Law Assembly Bill 943 assigns additional educational requirements to the California Debt and Investment Advisory Committee and requires local agencies to provide the necessary data. Specifically, AB 943: Requires CDIAC to collect, maintain, and provide information on local agency investments of public AB 943 -- 6/13/00 -- Page 2 http://www.leginfo.ca.gov/pub/bill/asm/ab_0.../ab_943_cfa_20000615_132125_sen_comm.htm 6/22/00 'AB 943 Assembly Bill - Bill Analysis Page 2 of 4 funds. Requires cities and counties that manage their own investment portfolios to semiannually forward their most recent quarterly investment reports and policy statements to CDIAC. Declares that it does not supersede any other statutory oversight responsibility for local investment decisions by local officials. Specifies that CDIAC assumes no fiduciary responsibilities or legal liability for any reports received under the requirements of this bill. Requires CDIAC to report to the Legislature by May 1, 2006 on its information collection activities and the value of this reporting requirement. Automatically terminates the reporting requirement on January 1, 2007. Comments 1. The Dower of sunshine . Municipal finance is a complex topic in California. An informed local official must have an understanding of the many debt instruments available to local jurisdictions as well as substantial knowledge of today's increasingly sophisticated investment opportunities. To help local officials and protect taxpayers, CDIAC provides a continuing education program for local officials with responsibilities for municipal investments. As part of this effort it collects, maintains, and provides comprehensive information on all state and local debt issues. By expanding its information collection activity to include reports on local agency investments, AB 943 enables CDIAC to expand its education program to provide valuable information on investment practices and policies. More sunshine means more information for local officials, aiding them in making better investment decisions with taxpayers' money. 2. Big brother . Local officials make local investment decisions. Neither CDIAC nor any other state agency has the authority to override or otherwise interfere with those decisions. Fearful that meddling may occur or that centralized investment information may lead to unfair comparisons of counties by unsophisticated users, local officials don't want big brother looking over their shoulders. The Committee may wish to consider if AB 943 -- 6/13/00 -- Page 3 information gathering and oversight regarding investment policies may have unintended consequences. http://www.leginfo.ca.gov/pub/bill/asm/ab_0.../ab_943_cfa_20000615_132125_sen comm.htm 6/22/00 r _ ; A B 943 Assembly Bill - Bill Analysis Page 3 of 4 3. Since last time . The Committee heard AB 943 at its May 3 hearing. The bill failed on a 3-3 vote, but the Committee granted reconsideration. To address the concerns of county officials, the author amended the bill to (1) delete the provision that CDIAC must use the gathered information to promote the best investment practices and policies and (2) clarify that by acquiring investment information, CDIAC assumes no oversight responsibilities for local investment decisions by local officials. 4. An extra set of eves . After the Orange County bankruptcy, the Legislature required local treasurers and chief financial officers to provide investment reports to their legislative bodies. In some cases, city councils or county boards of supervisors have the expertise to determine the appropriateness and safety of investment practices. In many cases, the legislative bodies lack that expertise. While CDIAC has no authority to override local investment decisions, it does have the technical and financial experts to review these investment reports. An extra set of eyes provides external oversight to help ensure local fiscal stability. 5. Not new reports . Current law requires local treasurers to provide quarterly investment reports as well as an annual statement of investment policy to their legislative body. AB 943 does not require the treasurer to produce a new report, but instead simply requires local agencies to provide CDIAC a copy of some of these already -required reports. CDIAC officials indicate e-mailed copies are fine. 6. Second time around . Last year Governor Davis vetoed a nearly identical measure, AB 1423 (Steinberg, 1999) over concerns that it would require $225,000 annually to the Treasurer's Office to support the new activities. This concern turned out to be a factual error as the Treasurer's Office neither requested nor required additional resources. Having cleared up the misunderstanding, as well as responding to a subsequent request by the Department of Finance to include language clarifying that CDIAC assumes no legal liability for any reports acquired under the requirements of this bill, CDIAC wants to try again. AB 943 -- 6/13/00 -- Page 4 Assembly Actions Not relevant to the April 27 version of the bill. Support and Opposition (6/15/) http://www.leginfo.ca.gov/pub/bill/asm/ab_0.../ab_943_cfa 20000615_132125_sen_comm.htm 6/22/00 •AB 943 Assembly Bill - Bill Analysis Page 4 of 4 Support State Treasurer Philip Angelides, County of Yolo, City of Los Angeles. _ Opposition California Association of County Treasurers and Tax Collectors, California State Association of Counties. http:/lwww.leginfo.ca.gov/pub/bill/asm/ab_0.../ab_943_cfa 20000615_132125_sen_comm.htm 6/22/00