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Home My WebLink About2003-07-23 IFC Regular Meeting Agenda Packet CITY OF PALM DEORT INVESTMENT & FINANCE COMMITTEE Minutes July 23, 2003, 2:00 p.m. North Wing Conference Room I. CALL TO ORDER A regular meeting was called to order by Chairman Gibson on Wednesday, July 23, 2003 at 2:07 p.m. II. ROLL CALL Present: Absent: Paul S. Gibson, Finance Director Russ Campbell Jean Benson, Mayor Bob Spiegel, Mayor Pro-Temp Thomas Jeffrey, Deputy City Treasurer Bob Hargreaves, City Attorney Carlos Ortega, City Manager Bill Veazie Everett Wood Murray Magloff Also Present: Dave Yrigoyen, Director of Redevelopment Dennis Coleman, RDA Finance Manager Rodney Young, General Manager Desert Willow Diana Leal, Recording Secretary Guests: None III. ORAL COMMUNICATIONS None. IV. COMMITTEE MEMBER REPORTS None. ' 1 72.101.Pd INVESTMENT & FINANCE rMITTEE MINUTES July 23, 2003 4 V. CONSENT CALENDAR A. Approval of Minutes Motion was made by Mr. Spiegel and seconded by Mr. Veazie to approve the Minutes of the June 25, 2003 meeting as submitted. VI. CONSENT ITEMS HELD OVER None. VII. NEW BUSINESS A. City and Redevelopment Agency Investment Schedules and Summary of Cash Reports for June 2003 Mr Jeffrey reported that, for the month ended June 30, 2003, the book value of the City Portfolio was approximately $178.2 million. The City earned approximately $225,000 in interest during that month. Portfolio yield-to- maturity was approximately 1.58%. For the month ended June 30, 2003, the book value of the RDA Portfolio was approximately $99.3 million. The RDA earned approximately $144,000 in interest during that month. Portfolio yield-to-maturity was approximately 1.71%. Mr. Jeffrey clarified that one of the auto industry notes shown in the May investment report was actually a Ford note, not a GM note. Mr. Spiegel asked if the City would be reducing its auto industry investment position as interest rates rise. Mr. Jeffrey responded that a significant portion of the City's auto industry notes were short-term, and would mature within 12 months. Mr. Jeffrey stated that he was not overly concerned about Ford, at present, since it is continuing to make money through cost-cutting and other efficiencies. Ford is expected to break even for 2003. The City has little interest in GM due to its $70 million pension/retiree health funding shortfall. Mr. Gibson reminded the Committee that the City had bought the Ford notes in order to fund the City's retiree health program, based upon actuarial projections. Even then, the City fell short of the actuarial return target by 75 basis points. Mr. Veazie commented that he read a recent article in the Wall Street Journal which indicated that Ford Motor Company is now focusing on cutting salaries. 2 72303.wpd INVESTMENT & FINANCEWMITTEE MINUTES July 23, 2003 B. State of California Local Agency Investment Fund Balance for the Month of June 2003 Mr. Gibson said that all of the City's accounts are invested to the maximum limit. C. California Asset Management Program (CAMP) June 2003 Mr. Gibson said that CAMP is close to being invested to the maximum limit. Mr. Jeffrey added that staff had explored the possibility of using surplus cash in CAMP to buy Boeing Co. medium-term notes. Staff had concluded, however, that Boeing's future was highly uncertain. Since staff has not identified any other corporate issuers with an attractive risk/return mix, surplus cash is being rolled over in CAMP. Mr. Ortega asked why the City had not bought Palm Desert Redevelopment Agency bonds with surplus cash. He thought that a seven-year maturity might bring the City a two-and-a-half to three percent yield. Mr. Gibson responded that he thought that a yield of two percent or less for that time period would probably be more likely. D. City and Redevelopment Agency Monthly Financial Reports for City Council for June 2003 Mr. Gibson said that they are currently estimating the revenues to be around $38.3 million and expenditures at $39.4 million. He is still waiting for Vacation Inn to pay. It is about 50 days until they Vacation Inn closes escrow. Mr. Spiegel asked what can be done regarding this matter. Mr. Gibson said that the City attorney is checking into the matter. Mr. Erwin said that Vacation Inn should have already wired or mailed the check. Ms. Benson said that Vacation Inn has a sign indicating Best Western. Mr. Gibson said that they are managing the hotel. Mr. Ortega asked what staff was estimating. Mr. Gibson said that the estimate is $38.3 million. Mr. Gibson said that due to land purchases acquired and the transfer of vehicle replacement reserves into the separate funds $2.7 million was paid out. These one time expenditures will not repeat each year. Mr. Spiegel asked if the land was purchased from the general fund. Mr. Gibson said that the money has been reimbursed and the new bonds were issued in August. Once the cash is received, the general fund will be reimbursed. 3 77303.wpd INVESTMENT & FINANCE MMITTEE MINUTES 0 July 23, 2003 Mr. Spiegel said that the final numbers for this year will show that the City's income is more than the expenses. Mr. Gibson said that he believes that it will be $1.4 million. Mr. Ortega said that if the actual picture is looked at and consider that the $2 million is in reserve. Mr. Spiegel said that the City's expenses will be $1 million more than the budget, however, the money will come and in and go out and the expenses will be on the positive. He asked what would happen if the state took out a percentage of the sales tax which would be a little more than $7 million. Mr. Gibson said that the $7 million needs to be removed from the $38 million. Mr. Ortega said that theoretically, the sales tax would go down by that amount, and property taxes would go up. Mr. Ortega said that the concern is that every year the legislature is going to have to make an appropriation to give the City the money. The legislature takes one half sales tax and the following year appropriates said tax to return it to the City. Mr. Spiegel said that the League of California Cities is trying to place an amendment on the ballot for next year that guarantees the cities revenues unless two thirds majority of the state wants to take the money away. E. Parkview Professional Office Buildings - Financial Report for June 2003 Mr. Gibson said that based on the comments made at the last meeting, the senior financial analyst added a box at the bottom to show the cost of improvements made. Mr. Spiegel asked if money was set aside as is done with the improvements made to the apartments. Mr. Gibson said that there is an enterprise fund which is an accumulated depreciation. The City has more than $1 million set aside. Mr. Gibson said that there is one office, on the second floor, that is vacant at this time. Mr. Coleman asked if the City expected to receive money from the State of California Department of Rehab. Mr. Gibson said that they have been paying and are current. The City has not received a notice stating that they will not pay- F. Palm Desert Golf Course Facilities Corporation Financial Information for May 2003 Mr. Young said that they are busy. The Marriott, across the street, is full. The concierge at the Marriott recommends Desert Willow for lunch causing the dining room and both banquet rooms to be full. 4 72303,w d INVESTMENT & FINANCE[&MMITTEE MINUTES 0 July 23, 2003 Mr. Spiegel said that he read in the paper that there is talk that the piece of property across from the Marriott , on the other side of Country Club, will be developed. They are using the area for temporary parking. Mr. Young said that the undeveloped area is used for the Frank Sinatra and other major events that Desert Willow hosts. He is not aware of what they plan to build on that land. He thinks that they need to build a parking lot or add a second level to their current parking lot. Mr. Young said that another alternative would be to have the employees park at the academy and provide shuttle service to the employees. Mr. Spiegel said that perhaps the City can talk to the Marriott to see what they are planning to do with their parking. Mr. Young said that next time he speaks with the manager of the Marriott, he will ask about the parking status. Mr. Young said that the food and beverage is a nice banquet and lunch cover business. This causes the parking lot to be full. The parking was not designed to accommodate a banquet business along with the golf course. At the last meeting, the committee discussed the possibility of obtaining a temporary bar to accommodate the events held at Desert Willow. He said that the cost for temporary bars is approximately $5,000. He will look into purchasing a temporary bar to have an additional bar for the banquets to be able to provide better service. He will obtain three bids and will request photos of the bars to show to the committee. Mr. Young said that Desert Willow's revenue in June was $407,000 and the budget was $489,000. The budget was missed by $82,000. The revenue was almost entirely golf course revenue. Food and beverage exceeded revenue by $75,000. Payroll was under budget by about $10,000. The pro shop revenue was at $41,000 with a budget of$68,000. It was missed by $27,000, however, it was $3,000 ahead of prior year. Mr. Spiegel said that he attended a class on Fiscal Management for Cities. He forwarded a book to Carlos Ortega and will ask him to send it to Mr. Gibson. He said that some of the cities have an offsite firm look at their financial books. This is done so that the residents of the city know that a reputable firm is looking at where the money is being invested and how the city stands from an expense to revenue standpoint. Mr. Gibson said that cities that have done this was due to their lack of comfort with their investments, financially, or they had a problem trusting their administrative and/or Finance staff. Mr. Wood said that he did not think that this was an efficient practice as strangers would be handling the books. 5 72303.w d INVESTMENT & FINANCE WMITTEE MINUTES • July 23, 2003 a Mr. Ortega said that in most cases the organization is dysfunctional, staff is not trusted or there is constant turnover. There are some cities that need other firms to tell them where they stand. Mr. Jeffrey said that some treasury departments, at the municipal level, do not have a policy and procedures in place. Vill. CONTINUED BUSINESS - None. IX. OLD BUSINESS A. Status of Public and Private Partnerships Background Checks There being no business issues to report, discussion ensued to the next agenda item. B. Bond Issuance by Palm Desert Financing Authority Mr. Coleman said that there are two tax allocation bonds: 1) project area #1 and 2) project area #3. Both bond issues were insured. Project area #1 was priced last week. They were extremely fortunate. He said that their feeling was that with rates at historical low, and they borrowed at the back end and the next time they go out the rates will go back up and will leave more principal in the Greenspan front end. They obtained this bond issue priced about an hour before Greenspan spoke. The ramifications were that once Greenspan spoke the bond market faded. One of the reasons the bond market faded was because one of the comments Greenspan made was about the federal deficit. There are fears on Wall Street that the federal government will issue more treasuries anywhere from 56 to 65 (billion) to deal with the deficit and that the treasuries would depress the prices on the ones they have. Most people look at a 10 year as a bench mark, however, when they issue debt they look at the 30 year. That started at a 4.77 that actually wound up at a 4.97 at the end of the pricing of the bonds. They were able to get 5.00 at a 4.56% and 4.57% in years 26 and 27. In years 28, 29 and 30 were 5.00 that yield at 4.57%. They borrowed all the money that yielded 4.58% or less for the debt which is really good. Basically what happened was they generated premiums in excess of the per amount and the premiums far exceeded what they had to pay for even the underwriting costs. They are going to have $18 million plus for funding when this bond issue closes on the 51" of August and they will be able to reimburse the City for expenditures they have reimbursement agreements, one is Westfield. 6 72301. pd INVESTMENT & FINANCE WMITTEE MINUTES . July 23, 2003 o Mr. Spiegel asked how much money will be left once everything is paid for. Mr. Coleman said that there will be about $6 million left for which they can expend on projects like the pool, the chamber building and the Living Desert. Mr. Spiegel asked if a certain amount has to go to low income housing. Mr. Coleman said that it is done with a separate set of money. In arriving at how much money they have to bond, all expenditures are subtracted. They tried to structure the bond to give the Agency flexibility with respect to the uncertainty of the State. They felt that there needed to be a certain amount of cash available from tax increment to pay the state for ERAF. Mr. Gibson said that they did two scenarios where staff calculated if the state takes $250 million or$500 million. The City can cover this amount for five years if this was done every year. Mr. Coleman said that they tried to price the second bond, however, the market was too crazy so they pulled out. They went back to the market on Monday. They had until Tuesday to price the bond issue, or go to back to council to change the resolution. Monday was another turbulent day. They were able to get it at 4.85% instead of 4.7%. They borrowed money at an arbitrage yield of under 4.9% for 30 years. This is the first bond issue that has been done for Project Area No. 3. The bond size if $4,745,000 and they are going to get it at almost $4.5 million for projects. This will take care of projects in project area #3, mainly sewer, streets and curbs and gutters. They obtained insurance on this project area as the very first bond they did, thus insurance was a little expensive. In Project Area No. 1 coverage is $1.15 for every $1.00 issued in bonds, however, in this new project area it is $1.50 in each. It is set up basically on a tier basis that lowers the coverages. The gross AV last fiscal year was $285 million. When it reaches $360 million, bonds can then be issued at a $1.35 rate and when the gross assessed valuation reaches $395 million bonds can be issued at $1.25. The insurance companies did this to avoid a situation where they were looking at the top 10 assessed valuees. They have a $1.60 coverage on Project Area No. 2 which dropped to $1.20 coverage when the top 10 were below a certain amount. The good news is that they obtained some preliminary numbers and they are doing very well towards the growth. They will be settling both bonds on the 5`h of August. They were very fortunate with the negotiations with the underwriters. They were contemplating another structure, however, when they saw that a 30 year bond had gone from 4.94% to 5.02% they decided to commit to these levels. At the end of the day it was at a 5.09% and the following day it fell and now the market is starting to come back again. They think that it will come up and down and the interest rates will go back up. 7 72303.wpd INVESTMENT & FINANCE COMMITTEE MINUTES 0 ` July 23, 2003 X. NEXT MEETING - Wednesday, September 24, 2003 at 2:00 p.m. XI. ADJOURNMENT There being no further business, the meeting was adjourned by Chairman Gibson at 2:57 p.m. Respectfully submitted, Diana Leal, Recording Secretary 8 72303 wpa (�" e • ent Agen1>. Rortfo i s �' GO N INU 5TMENT REPOR Paul S. Gibson, C.C.M.T., Treasurer Thomas W. Jeffrey, J.D., M.B.A., Deputy City Treasurer Treasurer's Commentary The Federal Open Market Committee (FOMC)did not meet this month. Growth in Gross Domestic Product (GDP) is expected to accelerate in the third quarter,due to tax cuts and mortgage refinancings. Although housing and autos have managed to limit the depth of the recession by remaining relatively strong, there is little upside in these two sectors, in terms of pent-up demand fueling a recovery. Profitability in most sectors has improved due to cost cutting and productivity gains. Merrill Lynch projects that GDP growth will remain slightly above 3%, through the end of 2004. Economic data is still conflicting. Although some indicators are now positive, there were 44,000 job losses in July and a steep fall in work hours. Since inflation remains low,the FOMC will be in no hurry to rise interest rates in the face of slack labor and product markets. Private sector firms continue to meet demand by running down inventories, rather than by increasing production. Consequently, extremely lean stockpiles will compel these firms either to increase production or to buy from foreign producers. Otherwise, they will be unable to meet demand and will lose business to competitors. The signals are that firms will respond to demand by increasing production. Consumer spending is expected to increase during the fourth quarter, further supporting a recovery. Pa4ldls di C.c.M r. Treasurer PORTFOLIO STATISTICS Dollars in Thousands JUL-03 JUN-03 MAY-03 APR-03 MAR-03 FEB-03 CITY Month-End Book Value"' $ 176,837 $ 178,187 $ 181,221 $ 156,385 $ 154,805 $ 165,188 Month-End Market Value"' $ 175,744 $ 178,198 $ 181,196 $ 156,385 $ 154,805 $ 165,271 Paper Gain (Loss) $ (93) $ 11 $ (26) $ - $ - $ 83 Prior Year Book Variance $ (13,631) $ (17,680) $ (7,959) $ (8,227) $ (4,171) $ (117) Interest Earnings $ 213 $ 225 $ 199 $ 185 $ 208 $ 212 Yield-To-Maturity 1.46% 1.58% 1.62% 1.45% 1.48%, 1.63% Weighted Maturity(Days) 71 71 69 1 1 28 Effective Duration 0.15 0.16 0.16 0.00 0.00 0.00 RDA Month-End Book Value"' $ 100,551 $ 99,266 $ 102,557 $ 103,387 $ 104,781 $ 103,760 Month-End Market Value"' $ 102,881 $ 101,611 $ 104,887 $ 105,700 $ 107,082 $ 106,053 Paper Gain (Loss) $ 2,330 $ 2,345 $ 2,330 $ 2,313 $ 2,301 $ 2,293 Prior Year Book Variance $ (14,515) $ 6,618 $ (1,091) $ (2,671) $ (24,885) $ (2,559) Interest Earnings $ 136 $ 144 $ 152 $ 137 $ 150 $ 139 Yield-To-Maturity 1.56% 1.71% 1.71% 1.74% 1.64% 1.67% Weighted Maturity(Days) 139 140 135 132 131 132 Effective Duration 0.07 0.08 0.08 0.09 0.09 0.10 "' Omits SLGSs. City of Palm Desert- Portfolio Characteristics* 31 July 2003 Dollars in Thousands Ageing Interval Market Value < 1 M $ 106,807 General Fund Ageing <2M - <3M 100 e7 <6M 60 <1 YR 10,088 a <2YR a 60 <3YR E 40 <4YR 6,799 a° <5YR 20 6 >5YR 0 0 0 0 0 Total: $ 122,694 <1M <2M <3M <6M <1YR <2YR Ratings Market Value Credit Quality AAA AAA $ 72, Unrated"' 72,786786 BBB 15,745 A B88 90/6 Al/P1 Unrated Total: $ 172,070 ` 42°/ Sector Market Value Asset Allocation Money Market Funds 83,539 LAIF LAIF 40,000 23% RDA Loan 32,786 MTNs 15,745 Money Market Ik unds U.S. Treasury F49% Federal Agency Commercial Paper Loan MTNsfWADRDA 19°h Total: $ 172,070 yy, Month City Yield LAIF Yield Variance Performance Aug02 2.64 2.59 0.04 Sep 2.22 2.60 -0.38 3.4 Oct 2.15 2.49 -0.33 Nov 2.00 2.30 -0.31 Dec 1.93 2.20 -0.27 Jan03 1.63 2.10 -0.47 'y 2'4 Feb 1.63 1.95 -0.32 S Mar 1.48 1.90 -0.43 Apr 1.45 1,86 -0.41 1.a RNLLLLL & L, May 1.62 1.77 -0.15 Au902 Sep Oct Nov Dec Jano3 Feb Mar Apr May Jun Jul Jun 1.58 1.70 -0.12 Jul 1.46 1.65 -0.20 INLAIF Yield pCity Yield Standard and Poor's Credit Ratings LAIF, HighMark,and City Loan to RDA Page 2 of 6 City of Palm Desert Portfolio Holdings 31 July 2003 Market Ratings Par Value Issuer Coupon Maturity Cost YTM Price Value I Moody's S A P Medium-Term Notes $ 3,300,000 FORD MOTOR 5.75 2/23104 $ 3,359,513 2.48 101.96 $ 3,364,746 A3 BBB $ 3,000,000 FORD MOTOR 7.20 6/15/07 $ 3,148,035 5.75 103.37 $ 3,101,181 A3 BBB $ 2,500,000 FORD MOTOR 7.20 6/15/07 $ 2,623,363 5.75 103.37 $ 2,584,317 A3 BBB $ 2,500,000 FORD MOTOR 7.50 6/15/04 $ 2,599,306 2.84 103.26 $ 2,581,510 A3 BBB $ 2,000,000 FORD MOTOR 6.70 7/16/04 $ 2,065,813 3.17 103.42 $ 2,068,480 A3 BBB $ 2,000,000 GENERAL MOTORS 6.38 1/30/04 $ 2,042,664 2.04 102.26 $ 2,045,210 A3 BBB $ 15,300,000 Subtotal $ 15,838,693 3.76 $ 15,745,444 LGIP $ 63,170,331 C.A.M.P. 0.00 8/1/03 $ 63,170,331 0.91 100.00 $ 63,170,331 N/A AAA $ 63,170,331 Subtotal $ 63,170,331 0.91 $ 63,170,331 LGIP $ 40,000,000 L.A.I.F. 0.00 8/1/03 $ 40,000,000 1.65 100.00 $ 40.000,000 NR NR $ 40,000,000 Subtotal $ 40,000,000 1.65 $ 40,000,000 Pooled Funds-AIM $ 20,368,735 PRIME PORTFOLIO 0.00 8/1/03 $ 20,368,735 0.67 100.00 $ 20,368,735 Aaa AAA $ 20,368,735 Subtotal $ 20,368,735 0.67 $ 20,368,735 Loan to RDA $ 32,785,480 CITY OF PALM DESERT 0.00 8/1/33 $ 32,785,480 1.65 100.00 $ 32,785,480 NR NR $ 32,785,480 Subtotal $ 32,785,480 1.65 $ 32,785,480 Total Investments $ 171,624,546 $ 172,163,239 1.46 $ 172,069,990 Cash $ 1,794,132 OFFICE COMPLEX CHKG 0.00 8/1/03 $ 1,794,132 0.00 100.00 $ 1,794.132 NR NR $ 1,266,814 CITY MAIN CHKG 0.00 8/1/03 $ 1,266,814 0.00 100.00 $ 1,266,814 NR NR $ 229,235 DESERT WILLOW CHKG 0.00 8/1/03 $ 229,235 0.00 100.00 $ 229,235 NR NR $ 21,338 OFFICE COMPLEX TRUST 0.00 8/1/03 $ 21,338 0.00 100.00 $ 21,338 NR NR $ 302,513 RECREATIONAL FAC CHKG 0.00 8/1/03 $ 302,513 0.00 100.00 $ 302,513 NR NR $ VACATION INN CHKG 0.00 8/1/03 $ - 0.00 100.00 $ - NR NR $ 3,614,031 Subtotal $ 3,614,031 $ 3,614,031 Total Cash and Investments $ 175,238,578 $ 175,777,271 $ 175,684,021 NR=Not Rated Page 3 of 6 Palm Desert Redevelopment Agency- Portfolio Charac'feristics 31 July 2003 Dollars In Thousands Ageing nterval Market Value 01 Portfolio Ageing < 1 M $ 61,358 w/a SLGSs <2M <3M 100 89 <6M so 60 < 1YR 180 70 <2YR 7,059 c so <3YR - 40 E 0 <4YR a° 30 <5YR 20 10 10 0 0 0 0 0 0 >5YR 0 Total: $ 68,597 <1M <2M <3M <6M < 1YR <2YR <3YR <4YR Quality' Market Value Credit Quality AAA $ 39,913 Unrated' 60,791 AAA AA 40 i A Unrated•• 60°fo At/P1 - Total: $ 100,704 Sector Market Value Asset Allocation U.S.Treasury $ 8,100 Money Market Money Market Funds 31,814 Funds LAIF 60,790 320/6 Federal Agency - Commercial Paper Q LAIF Corporate Bonds - U.S.Treasury 600/ 8% Total: $ 100,704 Month RDA Yield LAIF Yield Variance Performance Aug02 2.27 2.59 -0.33 Sep 2.26 2.60 -0.35 Oct 2.23 2.49 -0.25 Nov 2.06 2.30 -0.25 . 2.5 Dec 1.95 2.20 -0.25 Jan03 1.76 2.10 -0.34 6 Feb 1.66 1.95 -0.28 Mar 1.64 1.90 -0.26 Apr 1.74 1.86 -0.12 1.5 May 1.71 1.77 -0.06 Aug02Sep Oct Nov Dec Jan03 Feb Mar Apr May Jun Jul Jun 1.71 1.70 0.01 Jul 1.56 1.65 -0.09 ■LAIFYield ®RDAYield Standard and Poor's Credit Ratings LAIF and HighMark Sweep Page 4 of 6 �... �� '.JI :,r POI,Qi. C9P,.^ i O�i3O, i. I .. FU.O� t �.i -, �,. Palm Desert Redevelopment Agency Portfolio Holdings 31 July 2003 Market Ratings Par Value Issuer Coupon Maturity Cost I YTM I Price I Value Moody's I S& P U.S.Treasury-Discount $ 181,000 UNITED STATES TREASURY 4.63 2/15/04 $ 130,168 5.51 99.35 $ 179,818 Aaa AAA $ 7,143,000 UNITED STATES TREASURY 4.59 8/15/04 $ 4.989,671 5.54 98.60 $ 7,043,140 Aaa AAA $ 532,400 UNITED STATES TREASURY 4.66 8115103 $ 394,279 5.47 99.96 $ 532,166 Aaa AAA $ 344,600 UNITED STATES TREASURY 4.66 8/15/03 $ 255,200 5.47 99.96 $ 344,448 Aaa AAA $ 8,201,000 Subtotal $ 5,769,319 5.53 $ 8,099,572 LGIPs $ 40,000,000 L.A.I.F. 0.00 8/1/03 $ 40,000,000 1.65 100.00 $ 40,000,000 NR NR $ 9,644,975 L.A.I.F. BOND PROCEEDS 0.00 8/1/03 $ 9,644,975 1.65 100.00 $ 9,644,975 NR NR $ 4,969,078 L.A.I.F. BOND PROCEEDS 0.00 8/1/03 $ 4.969,078 1.65 100.00 $ 4,969,078 NR NR $ 6,177,006 L.A.I.F. (HOUSING AUTH) 0.00 8/1/03 $ 6,177,006 1.65 100.00 $ 6,177,006 NR NR $ 60,791,059 Subtotal $ 60,791,059 1.65 $ 60,791,059 Pooled Funds-AIM $ 31,813,783 PRIME PORTFOLIO 0.00 8/1/03 $ 31,813,783 0.67 100.00 $ 31,813,783 Aaa AAA $ 31,813,783 Subtotal $ 31,813,783 0.67 $ 31,813,783 Total Investments $ 100,805,842 $ 98,374,161 1.56 $ 100,704,414 Cash $ 1,543 COUNTRY CLUB CHKG 0.00 8/1/03 $ 1,543 0.00 100.00 $ 1,543 NR NR $ 1,852,524 HOUSING AUTH CHKG 0.00 8/1/03 $ 1.852,524 0.00 100.00 $ 1,852,524 NR NR $ 322,628 HOUSING AUTH TRUST 0.00 8/1/03 $ 322,628 0.00 100.00 $ 322,628 NR NR $ 2,176,696 Subtotal $ 2,176,696 $ 2,176,696 Total Cash and Investments $ 102,982,538 $ 100,550,857 $ 102,881,110 NR =Not Rated Page 5 of 6 STATEMENT OF COMPLIANCE The investment portfolios of the City of Palm Desert ('City')and the Palm Desert Redevelopment Agency ('RDA")are governed by federal, state, and local law. The City Treasurers'Statement of Investment Policy' is more restrictive than the California Government Code. The Palm Desert Investment Committee and the Palm Desert City Council review the Statement of Investment Policy annually. For the month ended 31 July 2003, the City and the RDA investment portfolios were in compliance with all applicable federal,state,and local laws and regulations. The City Treasury continued to pursue conservative and prudent investment strategies, based upon the stated objectives of safety, liquidity, and yield (in order of priority). Barring unforeseen events,the City Treasury should have sufficient cash to finance the operations of the City of Palm Desert and the Palm Desert Redevelopment Agency over the next six months. In addition, portions of either the City or the RDA portfolio could be liquidated in order to meet any significant, unexpected cash requirements. Bloomberg L.P. and Interactive Data Corporation provided the data and the analytical tools that were used to calculate the market value of all securities in the City and the RDA investment portfolios. State and Local Government Series securities are held in escrow accounts and are therefore not included in this report as assets. All balances are bank balances. Respectfully submitted on 27 August 2003, Pauzs. riawm c.c.M.r- City Treasurer SUMMARY OF AUTHORIZED INVESTMENTS California Government Code City Investment Policy CA Govt Maximum Maximum Quality Maximum Maximum Quality %of City %of RDA Code Investment Category Maturity Limit S&P/Mdys Maturity Limit S&P/Mdys Portfolio Portfolio 53601 a Palm Desert Bonds 5 Years No Limit Not Authorized 1 53601 b U.S.Treasuries 5 Years No Limit 5 Years I No Limit 1 0.0%, 5.9% 53601 c) CA State Debt 5 Years No Limit Not Authorized 53601 d CA Local Agency Debt 5 Years No Limit Not Authorized 53601 a Federal Agencies 5 Years No Limit 5 Years 30% - 0.0% 0.00% 53601 f Bankers's Acceptances 180 Days 40% 180 Days 1 40% 1 A-1 &P-1 53601 g Commercial Paper 270 Days 25% A-1+or P-1 270 Days 25% A-1+or P-11 0.0% 1 0.0% ,.. 53601 h Negotiable CDs 5 Years 30% EAAe 5 Years 30% AA-or Aaa 53601 i Re os 1 Year No Limit30 Da vs 20% AAA& Aaa FTh, Reverse Re os 92 Days 20% Not Authorized Medium-Term Notes 5 Years 30% 3 Years 30% A 9.2% 0.0°k Mutual Funds 90 Days 20% 90 Da vs 20% AAA&Aaa 48:5% 32.3% Trust Indenture Debt Not Authorized Secured Bank Deposits 5 Years No Limit Not Authorized Mortgage-Backed 5 Years 20% Not Authorized Securities AIF No Limit No Limit 281.0% 100.0% y loan to RDA, which is not a bond, has been a roved by the Palm Desert City Council. Certified California Municipal Treasurer Page 6 of 6 ` ' • City of Palm Desert . Desert Willow Budget Vs Actual For the mouth of July 2003 Budgeted Actual Budgeted Actual JUIV July S Percentage Warta Year to S Percentage Revenue 2003 2003 Variance Variance Date Date Variance Variance Course&Ground S 1:2,071 S 90,561 S (21.511) 80.81% S 112.072 $ 90.561 $ (21.511) 80,81°a Cans $ 16.474 $ 15,975 S (499) 96.97% S 16,474 S 15975 S (499) 96,97% Gol(Shop IS 24,444 S 24,885 S 441 101.80% S 24,444 $ 24.885 S 441 101.80% Ranee S 6W S 815 S 213 135.83% S 600 $ 815 S 215 135.83% Food&Beverage $ 54,289 S 42,905 S (11,384) 79.03% $ 54,289 $ 42,905 $ (I 1,384) 79,03% Interest Income S 350 $ - S (350) 0.00% $ 350 $ - $ (350) 0.00% -total Revenues $ 208 229 S 175,141 $ 33,088) 84.11% $ 208 229 $ 175,141 S (33,088) 84,11% Pavroll Proshop $ 4.389 S 6,881 $ (2,492) 156.78% S 4,389 $ 6,891 S (2492) 156.7896 Can $ 14.524 S 13,956 S 568 96.09% S 14,524 5 13.956 S 568 96.09% Course&Ground S 122.509 S 121.841 S 668 99.45% S 122.509 S 121,841 S 668 99.459,E Golf Operations S 22,033 S 22428 S (395) 101,79% S 22,033 S 22428 S (395) 101.79% General S_Administration $ 36,556 S 39.539 S (2.983) 108.16% S 36,556 S 39,539 S (2.983) 108.16% Food&Beverage S 49.366 S 54.068 S (4,702) 109.52% S 49.366 S 54.068 S (4,702) 1095'_e„ Total Pavrpll S 249 377 S 258,713 S (9,336) 103.74% $ 249 377 $ 258 713 S (9,336) 103,74% Other Expenditures Perimeter Landscaping S - S - S - 0,00% $ - S - $ - 0.0090 Proshop S 640 S 1.268 S (628) 198,13% S 640 S 1,268 S (6281 19813'. Proshop-COGS $ 13,961 S 10.766 S 3,195 77,11% S 13961 $ 10,766 S 3,195 77,119„ Can S 11.970 $ 11,011 $ 959 91.99% S 11,970 S 11,011 S 959 91.99% Course&Ground-North Course $ 57,954 S 62,053 S (4,099) 107.07% S 57,954 $ 62.053 S (4,099) 107.0790 Course&Ground-South Course $ 54,797 S 74,772 S (19,975) 136,45% $ 54,797 S 74,772 S (19.975) 136,45% Course&Ground-Desert Pallet-N $ 400 S 479 S (79) 119,75% S 400 S 479 S (79) 119.75% Course&Ground-Desert Pallet-S S 1,000 S 687 S 313 68.70% S 1.000 $ 687 S 313 68.70% Gol(Opefations S 175 $ 638 S (463) 364.57% $ 175 S 638 S (463) 364.57% General$Administration S 66.242 S 57,161 S 9.081 8&29% $ 66,242 S 57.161 S 9,081 86.2990 Ranee S 50 $ - S 50 0,00% S 50 S - S 50 0.009E Food&Beverage S 14.537 S 16,079 S (L542) 110.61% S 14,537 S 16,079 S (1,542) 110.61% Food&Beverage COGS S 16,809 5 19,383 S (2,574) 115,31% S 16809 S 19,383 5 (2,574) 115.319'. Management Fee $ 25,000 S 25,000 $ - 100,00% S 25,000 S 25,000 S - 100.00:e Financing/Lease S 5,732 S 5.629 S 103 98,20% S 5,732 S 5,629 S 103 98.20% 1 otal Other Expenditures S 269,267 S 284,926 S IS 659 105.82% S 269 267 $ 284,926 S IS 659 1115.82 Desert Willow Golf Academy Desert Willmv Golf Academy S 6,950 $ 6.895 S (55) 99.21% S 6,950 $ 6,895 S (55) 99.21°0 COGS-Merchandise S (6,823) S (6,265) S 558 91,82% S (6.823) $ (6,265) S 558 91.8296 Other Expenditures $ (3.900) S (4.441) S (541) 113.87% S (3,900) $ (4,441) S (541) 113.87% S Learning Center Income(Loss) S (3773) $ (3,811) S (38) 101.01% S (3773) S (3,811) S (38) 101.01% Operating Income(Lossl S (314,1891 $ (372,3091 S (59,1211 11950% S (314,188) S (372.309) S t59,1211 118,5091 Equipment Reserve Replacement $ 71,955 $ 72.101 S 146 100.20% S 71,955 $ 72,101 $ 146 100.20% Net Income Loss S (386,1431 (444.4101 S 58 267 115.09% $ (386,143) $ J444,4101 $ 58 267 115.09'% Snapshot of Golf Rounds Budgeted ma Actual Front Variance Variance°! Budgeted vtd Actual ytd Variance Variance% Resident 400 304 (96) 76% 400 304 (96) 769. Non Resident 2.813 2,729 (84) 97'. 2,813 2.729 (84) 97% Other - - - 0% - - - 09. Conttlimentary 220 276 56 1259. 220 276 56 125% Total 3,433 3,309 (124) 96% 3,433 31309 (1241 96°! Folder:Dcscrt WuO.2004:DW2004,Financfal Statement Page 1 . , 0 + 0 OM n IS . § 7aq / $ ; \ � / # & ® _` § � | - § / }) \ / \ /} § \ (0. \ \ ) \ \ / k < � /7 a 7 \ ) ) � � * � ~ � ad 0 � � )�a ] G 4) a § o ■ � © � 0 ) \ k � ) � ! a I9-E � ! &@ ! ! / $ ) ` ) \ ! \ # / m m d " ' � s : ._•: . ate � � � m . � , = _ _ _ _ � = _ �_ = e . ; _ - d � is — e k � wwwwww wwww«« ww« www» wwwww w«« w w » c u _ —U a ww»www » »,., www» ww« »»www »ww w "s E zz U U L a 2 ° i= F� S S O ..t u z` s Z O U $ a k \ § / E § § 7 2 � a / § 9 Cd 2 « ■ - ) I } j � § �7 � 7 • Q § 6 § B 5 W a { i ) � § ; ! # \ . / § ( kk o . k § cm CV) \ k LO CY o \ k� 2 � kLL � § ! § § / § � - {k $ u 0 ® ; « 2 § - 91 § _ 1 ■ o - 63. ) §cc k r- } o ® i � \ J \ } { ! \ m ! ° } } eke ° } $ ( \ - ,] - ] $ \ 7 \ * \ / 7 / � () � - f � �\ | k ! � . . ` . ! « } # ƒ : ) � ,\) ` � ) \ \) . . \/ K / | ! ! ` ® - - � ; | � ® , _ � _ _ �� ` ` \ ! # _ � «~ ( : _ _§ - �! ® !; ) a \ « - - ! ! - }/ : 2 »/ ; ! \/j = _ \ ,/ - : . } ¢ ` } � ~ « ®` ® _ 2 - � , - ! � � �& - `3 \ \! \ (& } ®t! ; k »& � _ « _ (} _ & � ! � , - e � � ! [ � f � : i / ! ) � ° ! � 2 . ! / / / ] % ! i ! f ! f ! / i . § �\ 2 k 2a 2 k � 222 ) ` ve � | • ■ $ 2 J $ § ! \ § Desert Willow Breakdown of Rounds per point of sale system DESERT WILLOW - Combined Analysis - JULY 2003 Resident 304 $ 10,640 $ 35.00 9.19% Non-Resident 2,729 $ 95,166 $ 34.87 82.47% Other -_ $ -_ $ _ - 0.00% Complimentary 276 $ 175 $ 0.63 8.34% Desert Willow Totals 3,309 105,981 32.03 100.05% Dw2004;Pos AVG RD Page 9 • Desert Willow • Breakdown of Rounds per point of sale system FIRECLIFF COURSE- JULY 2003 Description No. Of Revenue Avg. Per Pet to Rounds Per POS Round Total Resident Rounds Resident Fee- Weekend 302 $ 10,570 $ 35.00 9.62% Total Resident 302 10,570 35.00 9.62% Non Resident J Posted Weekend 234 $ 17,550 $ 75.00 7.45% IROC Des. PRTY - Weekday 4 $ 150 $ 37.50 __ _0.13% IROC MBR. Guest- Weekday _ 60 $ 3,600 $ 60.00 1.91% Wholesale Weekday 392 $ 18,892 $ 48.19 12.49% Twilight 821 $ 21,275 $ 25.91 26.15%_ Playe_ _rs Club 31 $ 1,085 $ 35.00 0.99% Outing 558 $ 16,657 $ 29.85 17.78% Fee Special Event Variable 467 $ 12,432 $ 26.62 14.88% 'total Non Resident Rounds 2,567 91,641 35.70 81.78% Other Rounds Junior Walking 0 $ - 0.00% Total Other 0 - 0.00% Complimentary VIP _ _ 94 0 $ - -- 2.99% PGA Member _ 45 0 $ 1.43% Donation 0 $ 0.00% Employee/Employee Guest 131 175 $ 1.34 4.179/. Total Complimentary 270 175 0.65 8.60% Total Round (FireCliff) 3,139 162,386 $ 32.62 100.00% PW2004;POS AVG RD Page 10 . Desert Willow • Breakdown of Rounds per point of sale system MOUNTAINVIEW COURSE- JULY 2003 Description No. Of Revenue Avg. Per Pet to Rounds Per POS Round Total Resident Rounds Resident Fee- Weekend 2 $ 70 $ 35.00 1.18% Total Resident 2 70 35.00 1.18% Non Resident Posted Weekend 3 $ 225 _ $ 75.00 1.76% Wholesale Weekend _ 3 $ 150 $ 50.00 1.7_6% Outing 33 $ 1,485 $ 45.00 19 41% Fee Special Event Variable 123 $ 1,665 $ 13.54 72.35% Total Non Resident Rounds 162 3,525 21.76 95.29% Other Rounds Junior Walking $ $ 0.00% Total Other 0.00% Complimentary --- - -- - VIP _ 2 $ $ -- -- 1.18% COD / PDHS 4 $ $ 2.356/. Total Complimentary 6 - 3.53% Total Rounds (Mountainview) 176 $ 3,595 $ 21.15 100% DW2004;POS AVG RD Page 11 + City of Palm Desert Desert Willow Cash Reserve Analysis for the month of July 2003 Cash Reserve Analysis One Mouth Required Reserve S 500,000.00 Cash on Hand S 429,310.00 Variance- Favorable ( Unfavorable) S (70,690.00) Please note: As part of the management agreement Kemper Sports Inc. will deposit the shortfall of the cash balance to the Desen Willow bank account. Page 12 Palmsert Recreation Facilities Corpo•on Income Statement Jul-03 Jul-03 # % Budget Actual Variance Variance Food & Beverage Revenues $54,289 $42,905 ($11,384) 79.03% Total Revenues $54,289 $42,905 ($11,384) 79.03% Salaries $49,366 $54,068 ($4,702) 109.52% Cost of Goods Sold-F&B $16,809 $19,383 ($2,574) 115.31% Food & Beverage Expense $14,537 $16,079 ($1,542) 110.61% Total Expenses $80,712 $89,530 ($8,818) 110.93% Net Income (Loss) ($26,423) ($46,625) ($20,202) 176.46% Note: The above revenues and expenditures are also included in the Desert Willow analysis. DW2004;PDRFC Budget Page 1 6 0 COMMITTEE MEETING WORKSHEET Meeting Description Investment Committee Meeting Date 7/23/03 Time 2:00 p.m. Location North Wing Conference Room Mailed Agenda 7/16/03 Posted Agenda 7/16/03 Time Convene Adjournment pall a- yi- Staff Members Attending Yes No Others Attending Yes No F4 1 Paul Gibson, Chairperson 11 Dennis Coleman 2 Council Member 12 Justin McCarthy 3 Council Member 13 Rodney Young ave E in, Fy2to3 Me 14 Recording Secretary 5 1 Carlos Ortega, City Mgr. 6 Thomas Jeffrey LZ Public Members Attendinq Guests Attending 7 Russ Campbell 15 8 Murray Magloff 711 16 9 Bill Veazie 17 10 Everett Wood 18 19 20 Follow-Ups/Tasks Assigned Person Responsible Due Date 1 /LQ.. 2 3 d- 0 4 5 6 , 7 8 16 �� cDn ►mot 3 �h` k�( 7 r� i • Spoke Mtn (1) Mtn (2) MEETING NOTES NA 116 J r s Spoke Mtn (1) Mtn (2) MEETING NOTES a QSX Ln 2 0 r P rush c C l .. ®® MEETING NOTES m DONE _F_;�1Ri , F01�1'I mo_ , !/_ r_ . i�i , , ..IITi1.lri �l►.'L.�. �Tlh7ri� IW'fi��lr1:�lC:� 2=i fA FIR mil m i�i wjj mp1!NIN191 ml W-mr, i�irM.. . .!Fi;;71 .. �® MEETING NOTES ice_ �" _ •_ .��,� Ste/ u ! e• �i.:- RAN R, IMF roo wrilmrl mill �I 1 _ �!Lti1�M li c! I' ��_ ►rr WH _ AW , . 05 ORA �`.MM//J 1 ;ICY / M�m IPA -..?fir, j .p,rr� . �: �REAIN.$ i��llfl►�. m��,<<1 , ,,'�i�e i f Owl 011 "O.MI,� i �i��i rm W,/. niW" r M�m MEETING NOTES w-M 40 mr , WARM =��WALIWIMWP Mal I'ul,ipgw-W Now, I ;I I I V Lr / / — IM Spoke Mtn (1) Mtn (2) MEETING NOTES 23 LA f Mt 17) C�-S 6 (J� 0 C] r _ CITY OF PALM DESERT INVESTMENT & FINANCE COMMITTEE AGENDA July 23, 2003, 2:00 p.m. North Wing Conference Room I. CALL TO ORDER II. ROLL CALL III. ORAL COMMUNICATIONS A. Any person wishing to discuss any item not on the agenda may address the Investment and Finance Committee at this point by giving his/her name and address for the record. Remarks shall be limited to a maximum of five minutes, unless the Investment and Finance Committee authorizes additional time. B. This is the time and place for any person who wishes to comment on agenda items. It should be noted that at the Investment and 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 the Investment and Finance Committee authorizes additional time. IV. COMMITTEE MEMBER REPORTS V. CONSENT CALENDAR ALL MATTERS LISTED ON THE CONSENT CALENDAR ARE CONSIDERED TO BE ROUTINE AND WILL BE ENACTED BY ONE ROLL CALL VOTE. THERE WILL BE NO SEPARATE DISCUSSION OF THESE ITEMS UNLESS MEMBERS OF THE INVESTMENT & FINANCE COMMITTEE OR AUDIENCE REQUEST ITEMS BE REMOVED FROM THE CONSENT CALENDAR FOR SEPARATE DISCUSSION AND ACTION UNDER SECTION V. CONSENT ITEMS HELD OVER, OF THE AGENDA. A. Approval of Minutes Rec: Approve minutes of the regular meeting of June 25, 2003, as submitted. Action: 1 072303.wp0 INVESTMENT & FINANCEL'flMMITTEE • AGENDA July 23, 2003 VI. CONSENT ITEMS HELD OVER None, VII. NEW BUSINESS A. City and Redevelopment Agency Investment Schedules and Summary of Cash Reports for June 2003 Rec: Review and submit for the next City Council agenda. Review the presentation on the investment graphs. Review the investment activity for June 2003. Action: B. State of California Local Agency Investment Fund Balance for the month of June 2003 Rec: Informational item for the Committee to review. No action required C. California Asset Management Program (CAMP) June 2003 Statement Rec: Informational item for the Committee to review. No action required D. City and Redevelopment Agency Monthly Financial Reports for City Council for June 2003 Rec: Report and submit to City Council Action: E. Parkview Professional Office Buildings - Financial Report for June 2003 Rec: Review and file report Action: 2 072303.M'Od INVESTMENT & FINANCEOMMITTEE • AGENDA July 23, 2003 F. Palm Desert Golf Course Facilities Corporation Financial Information for May 2003 Rec: Review and file report Action: Vill. CONTINUED BUSINESS None. IX. OLD BUSINESS A. Status of Public and Private Partnerships Background Checks Rec: Status report on background checks Action: B. Bond Issuance by Palm Desert Financing Authority Rec: Status report on issuing new bonds Action: X. NEXT MEETING - Wednesday, September 24, 2003 at 2:00 p.m. Due to staff working on audit, there will be no meeting in August 2003 XI. ADJOURNMENT I hereby certify under penalty of perjury under the laws of the State of California, that the foregoing agenda for the Investment and Finance Committee was posted on the City Hall bulletin board not less than 72 hours prior to the meeting. Dated this 1 , day uly, 2001 eal, c rdin Secretary 3 072303✓ d Mnnanee Department MEMORANDUM To: Records Technician From: Diana Leal, Administrative Secretary */ Subject: Investment and Finance Committee Meeting Date: August 8, 2003 Attached, for your records, is a copy of the July 23, 2003 Investment and Finance Committee meeting attendance register. Thank you for your assistance. Attachments (1) GAFinance\Diana Leal\Wpdocs\Investment Committcc\2002 Memos\City C1erk\2003\7-23-03attend.wpd y S g « z a G = 2 « 00 w a a4� W _ \ \ ® ! I ; 3 6 � \ ) ;t E \ > § ®/ ? ® 2 \ ( \ \ nm § ; B » 4 / E » 2 / E ! \ § p f 7 / � A Mnane Department MEMORANDUM ORANDUM To: Rachelle Klassen, City Clerk From: Diana Leal, Administrative Secreta 4W Subject: Investment and Finance Committee Meeting Date: August 8, 2003 Attached is a copy ofthe June 25,2003 minutes of the Investment and Finance Committee approved by the Committee on July 23, 2003. Please place on the next City Council agenda for approval thereof. Thank you for your assistance. Attachments (1) G:TinanceOiana Leal\Wpdocs\Investment Committee\2002 Memos\City C1erk\2003\6-25-03 wpd _ ® CITY OF PALM DESERT INVESTMENT & FINANCE COMMITTEE Minutes June 25, 2003, 2:00 p.m. North Wing Conference Room I. CALL TO ORDER A regular meeting was called to order by Finance Operations Manager Jose Luis Espinoza on Wednesday, June 25, 2003 at 2:01 p.m. II. ROLL CALL Present: Absent: Jose Luis Espinoza, Finance Operations Manager Murray Magloff Jean Benson, Mayor Bob Spiegel, Mayor Pro-Temp Thomas Jeffrey, Deputy City Treasurer Bob Hargreaves, City Attorney Carlos Ortega, City Manager Bill Veazie Russ Campbell Everett Wood Also Present: Steve Aryan, Assistant to the City Manager Justin McCarthy, ACM Redevelopment Dennis Coleman, RDA Finance Manager Diana Leal, Recording Secretary Guests: None III. ORAL COMMUNICATIONS None. IV. COMMITTEE MEMBER REPORTS None. 1 62503.wyd INVESTMENT & FINANCI�MMITTEE . MINUTES June 25, 2003 V. CONSENT CALENDAR A. Approval of Minutes Motion was made by Mr. Campbell and seconded by Mr. Veazie to approve the Minutes of the May 28, 2003 meeting as submitted. Mr. Spiegel abstained. VI. CONSENT ITEMS HELD OVER None. Vll. NEW BUSINESS A. City and Redevelopment Agency Investment Schedules and Summary of Cash Reports for May 2003 Mr Jeffrey reported that, for the month ended May 31, 2003, the book value of the City Portfolio was approximately $181.2 million. The City earned approximately $199,000 in interest. Portfolio yield-to-maturity was approximately 1.62%. For the month ended May 31, 2003, the book value of the RDA Portfolio was approximately $102.6 million. The RDA earned approximately $152,000 in interest. Portfolio yield-to-maturity was approximately 1.71%. Motion was made by Mr. Wood and seconded by Mr. Campbell to file report and submit report to the City Council. Motion carried. B. State of California Local Agency Investment Fund Balance for the Month of May 2003 Mr. Jeffrey said that three accounts have been set up: City, Redevelopment Agency and Housing Authority. The balances for these accounts have remained stable over the last few months. All accounts are maxed out with the exception of the Housing Authority that has room for an additional $31 million. C. California Asset Management Program (CAMP) May 2003 Mr. Jeffrey said that CAMP had made an error at the end of June, by debiting the City's account for $39,000. CAMP corrected the error the next day and paid the City the interest that was due for that day. 2 62503.wpd INVESTMENT & FINANC MMITTEE • MINUTES June 25, 2003 Mr. Spiegel asked if the City's CAMP account would be affected by the State budget impasse. Mr. Jeffrey replied that CAMP would not be affected since CAMP is a private sector fund, even though it has a local agency board. Additionally, the City's bill, SB 68 (Baffin), that was enacted in the last Legislative Session, precludes the State from seizing or freezing local agency monies under the State Treasurer's control. Motion was made by Mr. Campbell and seconded by Mr. Wood to file report and submit report to the City Council. Motion carried. D. Requalification of Existing Brokers: 1) Morgan Stanley 2) Merrill Lynch 3) Wells Fargo Institutional Securities 4) Citigroup Dismissal of Existing Broker: 1) Banc of America Securities Mr. Jeffrey said that the City has requested and received recertification documents from four of the City's five approved brokers. Treasury staff sent the fifth broker a termination letter per City, based upon excessive trade errors, excessive account officer turnover, and other relationship problems. Treasury staff anticipated soliciting new brokers for this vacant fifth position at the end of the summer (after completion of the audit and the enactment of SB 787 (Baffin)). Mr. Wood asked if five firms were necessary. Mr. Jeffrey responded that City policy requires five firms; also, that at least three firms are necessary in competitive bidding situations. Sometimes, depending on the type of securities the City is looking for, one of the firms cannot participate. The City typically looks for large primary firms with huge inventories that the City can draw from. Motion made by Mr. Campbell and seconded by Mr. Wood to requalify the four existing brokers and dismiss the existing broker Banc of America Securities. Motion carried. E. City and Redevelopment Agency Monthly Financial Reports for City Council for May 2003 Mr. Espinoza asked if there were any questions on the monthly report presented. There were no questions. 3 62503.wpd INVESTMENT & FINANC MMITTEE • MINUTES June 25, 2003 Mr. Spiegel said that he spoke with the mall manager the night before at the opening of Barnes and Noble. The manager informed Mr. Spiegel that the mall was 15% ahead of last year. It would seem that the parking structure has contributed to this success. Motion was made by Mr. Wood and seconded by Mr. Campbell to file report and submit report to the City Council. Motion carried. F. Parkview Professional Office Buildings - Financial Report for May 2003 Mr. Espinoza said that he was available to answer any questions. Mr. Spiegel asked why the operating income was down year to date as well as for the month. Mr. Coleman said that this was due to a combination of things. One being that there is 1,600 - 1,700 square feet vacant. Part of the space is being used for storage. The operating expenses are also up because of the charge of the roof repair at the office complex. Mr. Ortega said that if the capital improvement is removed from the Parkview budget, the City actually spent less than was budgeted. Mr. Espinoza said that for accounting and reporting purposes, the City uses a cash basis that is accrued at the end of the year. The tenant improvements are capital items that will be depreciated over the life of the asset which should be about 7 years. For cash basis, $300,000 plus were left. An adjustment will be made at the end of the year. Mr. Spiegel asked about the remodel of the ampitheater which will be in the form of a tree. Mr. Ortega said that if the City knows that capital improvements need to be made to the building, the City should set aside a reserve as a percentage of the budget. This way, the City will not have to have this type of accounting be done. Mr. Spiegel said that the City can do the same thing that is being done with the housing or apartments where money is being set aside. Mr. Espinoza said that accounting wise, as this account is considered an enterprise, it acts different from the housing which is classified as a special revenue. Accounting practice is to not place reserves or designate fund balances in enterprise funds so as to retain earnings. However, the City has a reserve set up. Mr. Espinoza said that with regard to the tree shaped ampitheater, the City transferred $1 million to the park fund for this purpose one year ago. The capital improvement program for last year has sufficient funds to remodel the ampitheater. If the amount goes over what was budgeted last year, staff may need to draw down more money from Parkview. Motion was made by Ms. Benson and seconded by Mr. Ortega to receive and file report. Motion carried. 4 62501. d INVESTMENT & FINANC MMITTEE . MINUTES June 25, 2003 G. Palm Desert Golf Course Facilities Corporation Financial Information for April 2003 Mr. Espinoza said that Rodney Young was unable to attend. Mr. Spiegel asked Mr. Ortega if the City was going to look into expanding the bar at Desert Willow. Mr. Ortega said that the City will eventually have to look at building a separate banquet facility. He said that banquets and weddings have proved to be a good business for Desert Willow because there is no idle overhead as is seen with a restaurant. He said that when there are a lot of events the bar tends to get busy. He believes that the solution would be to build a banquet room with a mobile bar. Ms. Benson said that in the meantime perhaps they can have separate bars. Mr. Spiegel suggested that they purchase a temporary bar. Mr. Ortega said that he will speak with Mr. Young about a temporary bar with an additional bar tender. The committee said that they would like to address any questions at the July meeting. Mr. Campbell informed the committee that he would not be attending the July meeting. Vill. CONTINUED BUSINESS - None. IX. OLD BUSINESS A. Status of Public and Private Partnerships Background Checks There being no business issues to report, discussion ensued to the next agenda item. B. Bond Issuance by Palm Desert Financing Authority Mr. Coleman said that the City of Palm Desert closed the bond this morning. They entered the market at a very good time. They issued a bond for $4,423,000. The bond was made up of three separate components: 1) Sunterrace which was refunding $980,000, 2) Merano $1,153,000, and 3) Silver Spur undergrounding $2,320,000. The market at this time is very good for issuing bonds. They were able to go out for 25 years on a non-rated basis. They tried to get this bond rated. The problem was that Merano has an 8.6 acre vacant piece in the corner of Country Club and Monterey. The rating agencies have a problem with rating this assessment district with this much vacant property. If the Merano district 5 62503.wpd INVESTMENT & FINANC MMITTEE • MINUTES June 25, 2003 is excluded, there is not enough homes to have property owner diversity to receive a rating. The 25 year portion will mainly affect Silver Spur. The refunding for the others go out to 20. The rate they got on the long end for the non-rating was 5.375 to yield at 5.485. The arbitrage yield for the whole assessment district bond was 4.912 on a 25 year basis. The Silver Spur Ranch was 5.15. The City borrowed money at a net interest cost of 5.227 for the undergrounding of the utilities. A significant part is that they received a net present value of savings for the homeowners of 18.06% (Sunterrace), and 8.67% (Merano). The threshold for refunding is usually about 3% net present value. Mr. Spiegel asked if the homeowners have been made aware of the savings. Mr. Ortega said that he thinks that people should be sent a letter from the Redevelopment Agency indicating the savings. Mr. Coleman said that the home owners will see the assessment in next year's property taxes. Mr. Spiegel asked if the home owners have prepaid. Mr. Coleman said that some of the owners have paid their portion of the assessment. Mr. Coleman said that they are progressing with Project Area No. 1 and No. 3 bonds. Project Area No. 3 bonds are going to be for capital improvements (i.e. sewer laterals, streets and curbs and gutters). Preliminary sizing, based on the rates they have today, that they believe will hold up, it is probable that it will yield a 4.50 yield on the 30 year bond. Staff is looking at different ways of accomplishing it: 1) set structure up with coupon of 5 that yields 4.50 so that premiums will be received from it. The preliminary sizing of the bond is $4,780,000 and if they are able to receive a surety for the reserve, they should have a little over $4.5 million in proceeds. The other bond was Project Area No. 1 bond. This bond will reimburse the City for the payment made for Westfield. RDA will reimburse the City for the payment of parking structure. The Fox property and other projects. They are looking at structuring that bond a little differently as they are going to stack a lot of the principal with the back years. Now that long term yields are at about 4.5, they want to take advantage of those so that when they do future bonds it will allow staff to do more bonds. They will price the bond on July 10 or so. He expects to close these bond issues by the end of next month. Mr. Coleman said that they are in the process of getting these two bond issues insured. They don't see a problem with getting the insurance. They are leaving a lot of money on the table. The Redevelopment Agency is not bonded to capacity and will not do so until the State budget is resolved. This is the first bond in Project Area No. 3. Where there is $1.15/$1.00 of debt in Project Area 1, they are hoping to get $1.25/$1.00 in that project area. They hope to get a commitment from MBIA. 6 625W-PE INVESTMENT & FINANC MMITTEE MINUTES • June 25, 2003 X. NEXT MEETING - Wednesday, July 23, 2003 at 2:00 p.m. XI. ADJOURNMENT There being no further business, the meeting was adjourned by Mr. Spiegel at 2:35 p.m. Respectfully submitted, D' a Lea , Re inggbcretary 7 625 I7 d �,��'' SyCtty e p entAgena. Porttoios Paul S. Gibson, C.C.M.T., Treasurer Thomas W. Jeffrey, J.D., M.B.A., Deputy City Treasurer Treasurer's Commentary The next Federal Open Market Committee (FOMC) meeting will be on 12 August. In recent Congressional testimony, Chairman Alan Greenspan stated that he was committed to keeping interest rates low even if there is an economic rebound. He indicated that the preferred policy tool would be to continue to lower the Federal Funds Rate, which is currently at 1%. Long-term bond yields have recently risen, based upon a belief that the U.S. Treasury will have to offer higher interest rates in order to attract capital to finance the budget deficit. Likewise, the 10-year Treasury yield has also risen as investors have closed out bond positions and invested in stocks in a wager that there will be a global economic recovery. Stock PIE multiples are currently higher than they were during the market peak three years ago, however. The U.S. auto industry, which is a key economic component through the multiplier effect, is under severe pressure from Japanese competition. Both Ford and GM are now rated "BBB", although Ford appears to be in a stronger position due to GM's$70 billion unfunded pension problem. Closer to home,the State of California is currently deadlocked on resolving the budget deficit and is operating without an approved budget. The gubernatorial recall election is only expected to exacerbate the situation, and contribute to the exhaustion of California's cash. California currently has S&P's lowest credit rating of "A"for it general obligation debt. It shares the distinction of being at the bottom with Louisiana. Pis 67dVOP4 C.C.M r. Treasurer PORTFOLIO STATISTICS Dollars in Thousands JUN-03 MAY-03 APR-03 MAR-03 FEB-03 JAN-03 CITY Month-End Book Value"' $ 178,187 $ 181,221 $ 156,385 $ 154,805 $ 165.188 $ 174,152 Month-End Market Value— $ 178,198 $ 181,196 $ 156,385 $ 154,805 $ 165,271 $ 174,276 Paper Gain (Loss) $ 11 $ (25) $ - $ - $ 83 $ 124 Prior Year Book Variance $ (17,680) $ (7,959) $ (8,227) $ (4,171) $ (117) $ (5,672) Interest Earnings $ 225 $ 199 $ 185 $ 208 $ 212 $ 212 Yield-To-Maturity 1.58% 1.62%, 1.45%" 1.48%" 1.63%" 1.63% Weighted Maturity(Days) 71 69 1 1 28 29 Effective Duration 0.16 0.16 0.00 0.00 0.00 0.01 RDA Month-End Book Value"' $ 99,266 $ 102,557 $ 103,387 $ 104,781 $ 103,760 $ 105,023 Month-End Market Value"' $ 101,611 $ 104,887 $ 105,700 $ 107,082 $ 106,053 $ 107,333 Paper Gain (Loss) $ 2,345 $ 2.330 $ 2,313 $ 2,301 $ 2,293 $ 2,310 Prior Year Book Variance $ 6,618 $ (1,091) $ (2,671) $ (24,885) $ (2,559) $ 19,541 Interest Earnings $ 144 $ 152 $ 137 $ 150 $ 139 $ 162 Yield-To-Maturity 1.71% 1.71% 1.74% 1.64% 1.67% 1.76% Weighted Maturity(Days) 140 135 132 131 132 133 Effective Duration 0.08 0.08 0.09 0.09 0.10 0.10 "' Omits SLGSs. Cftorf Palm Desert- Portfolio Characteristic 30 June 2003 Dollars in Thousands Ageing nterval Market Value < 1 M $ 107,311 General Fund Ageing <2M <3M 100 97 <6M 80 <1YR 8,014 <2YR 2,071 o so <3YR - 40 <4YR - n <5YR 5,804 20 7 >5YR 0 o 0 0 2 Total: $ 123,200 <1M <2M <3M <6M <1YR <2YR Ratings Market Value Credit Quality AAA AAA $ 15,887 �/ Unrated"' 72,785 BBB 15,887 AA BBB eta ,. A 9% A l Unrated Total: $ 171,890 42% Sector Market Value Asset Allocation Money Market Funds 83,218 LAIF LAIF 40,000 yf 23% RDA Loan 32,785 MTNs 15,887 Money Market U.S. Treasury Funds as^ Federal Agency Commercial Paper - RDA Loan MTNs® 19% Total: $ 171,890 9% Month CitV Yield LAIF Yield Variance Performance Ju102 2.88 2.71 0.17 Aug 2.64 2.59 0.04 3.4 Sep 2.22 2.60 -0.38 Oct 2.15 2.49 -0.33 Nov 2.00 2.30 -0.31 Dec 1.93 2.20 -0.27 v_ 2.4 m Jan03 1.63 2.10 -0.47 IWL , 0 Feb 1.63 1.95 -0.32 Mar 1.48 1.90 -0.43 1.4 Apr 1.45 1.86 -0.41 Ju102 Aug Sep Oct Nov Dec Jan03 Feb Mar Apr May Jun May 1.62 1.77 -0.15 Jun 1.58 1.70 -0.12 IM LAIF Yield 00ty Yield ' Standard and Poor's Credit Ratings " LAIF, HighMark, and City Loan to RDA Page 2 of 6 P re,w�� nro,e r cos .`QE,� ftrS,:L $ isE'i�� CF.fi,c P Gr�,CE 000,0' �II\,SE \88.d� �� ' l �! '_ Sr;- O�.P u4 r City of Palm Desert Portfolio Holdings 30 June 2003 Market Ratings Par Value Issuer Coupon Maturity Cost I YTM I Price I Value I Moody's S& P Medium-Term Notes $ 3,300,000 FORD MOTOR 5.75 2/23/04 $ 3,368,351 2.48 102.09 $ 3,368,884 A3 BBB $ 3,000,000 FORD MOTOR 7.20 6/15/07 $ 3,151,221 5.75 105.43 $ 3,162,903 A3 BBB $ 2,500,000 FORD MOTOR 7.20 6/15/07 $ 2,626,018 5.75 105.43 $ 2,635,752 A3 BBB $ 2,500,000 FORD MOTOR 7.50 6/15/04 $ 2,608,793 2.84 103.59 $ 2,589,792 A3 BBB $ 2,000,000 GENERAL MOTORS 6.70 7/16/04 $ 2,071.536 3.17 103.83 $ 2,076.658 A2 BBB $ 2,000,000 GENERAL MOTORS 6.38 1/30/04 $ 2,049,814 2.04 102.64 $ 2,052,708 A2 BBB $ 15,300,000 Subtotal $ 15,875,734 3.76 $ 15,886,697 LGIP $ 65,120,529 C.A.M.P. 0.00 7/1/03 $ 65,120,529 1.08 100.00 $ 65,120.529 N/A AAA $ 65,120,529 Subtotal $ 65,120,529 1.08 $ 65,120,529 LGIP $ 40,000,000 L.A.I.F. 0.00 7/1/03 $ 40,000,000 1.70 100.00 $ 40,000,000 NR NR $ 40,000,000 Subtotal $ 40,000,000 1.70 $ 40,000,000 Pooled Funds-AIM $ 18,097,806 PRIME PORTFOLIO 0.00 7/1/03 $ 18.097,806 1.01 100.00 $ 18,097,806 Aaa AAA $ 18,097,806 Subtotal $ 18,097,806 1.01 $ 18,097,806 City Loan to RDA $ 32,785,480 CITY OF PALM DESERT 0.00 711/33 $ 32,785,480 1.70 100.00 $ 32,785.480 NR NR $ 32,785,480 Subtotal $ 32,785,480 1.70 $ 32,785,480 Total Investments $ 171,303,816 $ 171,879,549 1.58 $ 171,890,513 Cash $ 1,876,123 OFFICE COMPLEX CHKG 0.00 7/1/03 $ 1,876,123 0.00 100.00 $ 1,876,123 NR NR $ 3,686,742 CITY MAIN CHKG 0.00 7/1/03 $ 3,686,742 0.00 100.00 $ 3,686,742 NR NR $ 371,748 DESERT WILLOW CHKG 0.00 711t03 $ 371,748 0.00 100.00 $ 371,748 NR NR $ 21,338 OFFICE COMPLEX TRUST 0.00 7/1/03 $ 21,338 0.00 100.00 $ 21,338 NR NR $ 246,980 RECREATIONAL FAC CHKG 0.00 7/1/03 $ 246,980 0.00 100.00 $ 246,980 NR NR $ - VACATION INN CHKG 0.00 7/1/03 $ - 0.00 100.00 $ - NR NR $ 6,202,931 Subtotal $ 6,202,931 0.00 $ 6,202,931 Total Cash and Investments $ 177,506,747 $ 178,082,480 $ 178,093,444 NR=Not Rated Page 3 of 6 Palm Desetedevelopment Agency- Portfolio Characteristics 30 June 2003 Dollars In Thousands Ageing Interval Market Value 01 Portfolio Ageing <1 M $ 60,491 w/o SLGSs <2M - <3M 875 100 90 88 <6M 80 <1YR 180 a 70 <2YR 7,044 0 60 a 50 <3YR 40 <4YR a° 30 <5YR 20 10 10 0 1 0 0 0 0 >5YR 0 Total: $ 68,590 <1M <2M <3M <61vl <1YR <2YR <3YR <4YR Quality• Market Value Credft Quality AAA $ 38,969 Unrated" 60,629 AAA AA - 39% A Unrated" 61% Al/P1 Total: $ 99,598 Sector Market Value Asset Allocation U.S.Treasury $ 8,114 Money Market Funds 30,855 Money Market LAI F 60,629 Funds 31% Federal Agency - Commercial Paper LAW Corporate Bonds U.S.Treasury 61% e% Total: $ 99,598 Month RDA Yield LAW Yield Variance PeAormance Ju102 2.23 2.71 -0.48 Aug 2.27 2.59 -0.33 Sep 2.26 2.60 -0.35 Oct 2.23 2.49 -0.25 2.5 Nov 2.06 2.30 -0.25 Dec 1.95 2.20 -0.25 & Jan03 1.76 2.10 -0.34 Feb 1.66 1.95 -0.28 Mar 1.64 1.90 -0.26 1.5 Apr 1.74 1.86 -0.12 Ju102 Aug Sep Oct Nov Dec Jan03 Feb Mar Apr May Jun May 1.71 1.77 -0.06 Jun 1.71 1.70 0.01 ■LAIFYieIdpRDA Yield ' Standard and Poor's Credit Ratings LAIF and HighMark Sweep Page 4 of 6 r^a,oa c zc� Obi aw e eLs,a� en,00 D P r,4 II &�v1,83 r j I it it II I I, Mo 0\.P r\.r nun Palm Desert Redevelopment Agency Portfolio Holdings 30 June 2003 Market Ratings Par Value Issuer Coupon Maturity Cost YTM Price Value Moody's S&P U.S.Treasury-Discount $ 181,000 U.S.TREASURY 4.63 2/15/04 $ 130,168 5.51 99.36 $ 179,836 Aaa AAA $ 7,143,000 U.S.TREASURY 4.59 8115104 $ 4,989,671 5.54 98.82 $ 7,058,784 Aaa AAA $ 532,400 U.S. TREASURY 4.66 8/15/03 $ 394,279 5.47 99.85 $ 531,623 Aaa AAA $ 344,600 U.S. TREASURY 4.66 8/15/03 $ 255,200 5.47 99.85 $ 344,097 Aaa AAA $ 8,201,000 Subtotal $ 5,769,319 5.53 $ 8,114,340 LGIPs $ 40,000,000 L.A.I.F. 0,00 7/1103 $ 40,000,000 1.70 100.00 $ 40,000,000 NR NR $ 4,923,322 L.A.I.F. BOND PROCEEDS 0.00 7/1/03 $ 4,923,322 1.70 100.00 $ 4,923,322 NR NR $ 9,556,165 L.A.I.F. BOND PROCEEDS 0.00 7/1/03 $ 9,556,155 1.70 100.00 $ 9,556,155 NR NR $ 6,150,000 L.A.I.F. (HOUSING AUTH) 0,00 7/1/03 $ 6,150,000 1.70 100.00 $ 6,150,000 NR NR $ 60,629,418 Subtotal $ 60,629,478 1.70 $ 60,629,478 Pooled Funds-AIM $ 30,854,813 PRIME PORTFOLIO 0.00 7/1/03 $ 30,854.813 1.01 100.00 $ 30,854,813 Aaa AAA $ 30,854,813 Subtotal $ 30,854,813 1.01 $ 30,854,813 Total Investments $ 99,685,290 $ 97,253,610 1.71 $ 99,598,630 Cash $ 1,698,295 HOUSING AUTH CHKG 0.00 7/1/03 $ 1,698,295 0.00 100.00 $ 1,698,295 NR NR $ 312,067 HOUSING AUTH TRUST 0.00 7/1/03 $ 312.067 0.00 100.00 $ 312,067 NR NR $ 1,746 COUNTRY CLUB CHKG 0.00 711103 $ 1,746 0.00 100.00 $ 1,746 NR NR $ 2,012,108 Subtotal $ 2,012,109 0.00 $ 2,012,108 Total Cash and Investments $ 101,697,399 $ 99,265,718 $ 101,610,739 NR=Not Rated Page 5 of 6 STATEMENT OF COMPLIANCE The investment portfolios of the City of Palm Desert('City')and the Palm Desert Redevelopment Agency ('RDA')are governed by federal, state, and local law. The City Treasurer's'Statement of Investment Policy' is more restrictive than the California Government Code. The Palm Desert Investment Committee and the Palm Desert City Council review the Statement of Investment Policy annually. For the month ended 30 June 2003,the City and the RDA investment portfolios were in compliance with all applicable federal, state,and local laws and regulations. The City Treasury continued to pursue conservative and prudent investment strategies, based upon the stated objectives of safety, liquidity,and yield (in order of priority). Barring unforeseen events,the City Treasury should have sufficient cash to finance the operations of the City of Palm Desert and the Palm Desert Redevelopment Agency over the next six months. In addition,portions of either the City or the RDA portfolio could be liquidated in order to meet any significant, unexpected cash requirements. Bloomberg L.P. and Interactive Data Corporation provided the data and the analytical tools that were used to calculate the market value of all securities in the City and the RDA investment portfolios. State and Local Government Series securities are held in escrow accounts and are therefore not included in this report as assets. All balances are bank balances. Respectfully submitted on 23 July 2003, Paul.S. tir lout C.C.R.T: City Treasurer SUMMARY OF AUTHORIZED INVESTMENTS California Government Code City Investment Policy CA Govt Maximum Maximum Quality Maximum Maximum Quality %of City %of RDA Code Investment Category Maturity Limit S&P/Mdys Maturity Limit S&P/Mdys Portfolio Portfolio 53601 a Palm Desert Bonds 5 Years No Limit Not Authorized 1 53601 b U.S.Treasuries 5Years No Limit 5 Years No Limit 0.0% 5.9% 53601 c CA State Debt 5 Years No Limit Not Authorized 53601 d CA Local Agency Debt 5 Years No Limit Not Authorized 53601(e) Federal Agencies 5 Years No Limit 5 Years 30% 0.0% 0.0% 53601 f Bankers's Acceptances 180 Days 40% 180 Days 40%V P-1 - 53601 Commercial Paper 270 Days 25% A-1+or P-1 270 Days 25% P-1 . 0.0% 0.0% 63601 h) Negotiable CDs 5 Years 30% 5 Years 30% Aa3 53601 i Re os 1 Year No Limit 30 Da vs 20% Aaa - 53601 i Reverse Re os 92 Days 20% Not Authorized .536010) Medium-Term Notes 5 Years 30% A 3 Years 30% A 1 9.20% 0.0% 53601 k) Mutual Funds 90 Days 20% AAA&Aaa 90 Days 20% AAA&Aaal 4&4% 31.7% 53601 I Trust Indenture Debt Not Authorized 53601 m Secured Bank Deposits 5 Years No Limit Not Authorized 53601(n) Mortgage-Backed 5 Years 20% A(Issuer) & Not Authorized Securities AA(Security) 16429 LAW No Limit No Limit 23.30/. 80.9% 100.0% 1 The City loan to RDA, which is not a bond, has been approved by the Palm Desert Cit Council. Certified California Municipal Treasurer Page 6 of 6 STATE OF CALIFORNIA PHILIP ANGELIDES, Treasurer OFFICE OF THE TREASURER SACRAMENTO CFFYJCE ALM'DEM R „m Local Agency Investment Fun t� PO Box 942809 Sacramento, CA 94209-0001 21D3 JUL [0 M1 '9: 1.4 (916) 653-3001 June, 2003 Statement CITY OF PALM DESERT Account Number : 98-33-621 Attu: CITY TREASURER 73510 FRED WARING DRIVE PALM DESERT CA 92260 Account Summary Total Deposit : 0.00 Beginning Balance : 40,000,000.00 Total Withdrawal : 0.00 Ending Balance : 40,000,000.00 Page : l of 1 STATE OF CALIFORNIA PHILIP ANGELIDES, Treasurer OFFICE OF THE TREASURE SACRAMENTO MY OF PALM DESERT Local Agency Investment Fund FINANCE DEPARTMENT PO Box 942809 Sacramento,CA 94209-0001 2M3 JUL 10 AH g' [4 (916) 653-3001 June, 2003 Statement PALM DESERT REDEVELOPMENT AGENCY Account Number : 65-33-015 Attn: TREASURER 73-510 FRED WARING DRIVE PALM DESERT CA 92260 Account Summary Total Deposit : 0.00 Beginning Balance : 40,000,000.00 Total Withdrawal : 0.00 Ending Balance : 40,000,000.00 Page : 1 of 1 STATE OF CALIFORNIA PHILIP ANGELIDES, Treasurer OFFICE OF THE TREASURER SACRAMENTO MY O DEPARTMENT ER Local Agency Investment Fund F PO Box 942809 Sacramento, CA 94209-0001 2@3 JUL I:Q 91 g` 1:8 (916) 653-3001 June, 2003 Statement PALM DESERT HOUSING AUTHORITY Account Number : 25-33-003 Attn: DEPUTY CITY TREASURER 73-510 FRED WARING DRIVE PALM DESERT CA 99260-2578 Transactions Effective Transaction Tran Confirm. Authorized Amount Date Date Type Number Caller 06-26-2003 06-26-2003 RW 402029 THOMAS JEFFREY - 2,850,000.00 Account Summary Total Deposit : 0.00 Beginning Balance : 9,000,000.00 Total Withdrawal : 2,850,000.00 Ending Balance : 6,150,000.00 Page : I of 1 COY OF PALM DESERT CALIFORNI A ASSE r FINANCE DEPARTM'ENI STATEMENT MAW AGEbIENT PROOR kNi JOINI POWERS AUTH ORI'r 1' —� � r!C 50CALIFORNIAS'1'liEle"f 2311D PLtJpR 1,(`• JUL 45 'AN FRANCISCO C.N-IFO R"IA 1i111 LWJ FOR ACCOUNT INFORMATION: 800-729-7665 STATEMENT DATE: 6/30/2003 CITY OF PALM DESERT ACCOUNT NUMBER: 553-00 OPERATING FUND 73-510 FRED WARING DRIVE FUND NAME: Cash Reserve Portfolio PALM DESERT,CA 92260 Page 1 of 1 A ount Summary as o 6f30l20141=03 Statement Income Dividends Capital Gains Total Shares Account Date Paid This Year Paid This Year owned Value 6/30/2003 $314,626.56 $0.00 65,120,529.200 $65,120,529.20 Transaction S ar for 1f2 > 3%29u03 Beginning Balance Purchases Reinvestments Redemptions Ending Balance $68,522,355.59 $39,067.01 $59,106.60 $3,500,000.00 $65,120,529.20 :RAN - POS7 NG -. WBti -' -'• OL'Ll.k� AMU S A E SHARES THIS OT n TE V .MDATE RA S C RANSAt:TI•N PRIG T ANSAGTION SHARES OWNED 06/01/03 Beginning Balance 68,522,355.590 06/01/03 6/1/2003 Correction, CHK#272 5/30/03 $7,046.97 $1.00 7,046.970 68,529,402.560 06/01/03 6/1/2003 Correction,CHK#275 5/30/03 $32,020.04 $1.00 32,020.040 68,561,422.600 06/11/03 6/11/2003 Redemption-Wire Red. $1,500,000.00- $1.00 1,500,000.000- 67,061,422.600 06/20/03 6/20/2003 Redemption-Wire Red. $800,000.00- $1.00 800,000.000- 66,261,422.600 06/24/03 6/24/2003 Redemption-Wire Red. $1,200,000.00- $1.00 1,200,000.000- 65,061,422.600 06/30/03 7/1/2003 Accrual Income Div Reinvestment-DIV $59,106.60 $1.00 59.106.600 65,120,529.200 Message Line: THE DIVIDEND YIELD FOR THE MONTH IS 1.07%. THE ANNUALIZED YIELD IS 1.08%. ~ A O O N G ry o O Y A m ry N 'O G G •� G1 7' Vi m S ,'� eo ea' `� rt O p VJ T —I h �` Y � L] a. 4�. o G� � z�' }Di c •T, A :y � w mao4 \2` w ❑ � z S O � ENO W Vi r U N � J O N N �O �p J O N N � �• A O G W J Oo y W J O\ ...• � al O W O 'a O; 4h N N N N w G O T A J A N D\ L O oo CDW 0 0\ to W O O �- y 0 D\ J Vi a\ O O o0 COS Oo yO lyJ O Oy �8yt O ryO- a C O in 0` J N U w a a, W In Oa W d\ W O\ O YJ W O O A _ o NEl A "•^ 1 O N .- o0 00 .- N .•. O — W �W+ w oo �yO �O oo `�. W 4 'q p �? r rO O O O O O O C _. `G w O b O A ww a � N �D O vi N A oo ao p O N --- � N w Oi .-• q. w O O N J �l to J �O t0 00 In Ln W O �7 RI opo N N N to in to Qti N O O to oa ..pp W C �- J O Oo A to � ^ u to 01 N J to to oa N � W to N 4r O` O � ao � II a Y N rl O • City of Palm Desert • t Parkview Office Complex Financial Statement for Fiscal Year 2002-2003 June-03 June-03 # % YTD YTD # % Budget Actual Variance Variance Budget Actual Variance Variance x Revenues Rental $ 68,500 $ 68,187 $ (313) 99.545, "5 eb'.. $ 822,000 $ 844,700 $ 22,700 102.76% Dividends/Interest $ 4,375 $ 216 $ (4,159) 4.93% +-° $ 52,500 $ 7,982 $ (44,518) 15.20% 41 Total Revenues $ 72,875 $ 68,403 5 (4,472) 93.86%`1P_,,.I - $ 874,500 $ 852,682 $ (21,818) 97.51% Expenses Professional-Accounting&Auditing $ 7,000 $ 7,712 $ (712) 110.16% + x $ 84,000 $ 92,538 $ (8,538) 110.16% Professional-Consultants $ 6,000 $ 5557 $ 443 92.62% $ 72,000 $ 68,747 $ 3,253 95.48% Tenant Improvements $ 2,500 $ - $ 2,500 0.00% $ 30,000 $ 322,103 $ (292,103) 1073.68% Repairs&Maintenance Building $ 8,000 $ 11,491 $ (3,491) 143.63% $ 96,000 $ 113,146 $ (17,146) 117,86% Repairs&Maintenance-Landscaping $ Z300 $ - $ 2,300 0.00% ,.n $ 27,600 $ - $ 27,600 0.00% Utilities-Water $ .. 250 $ 122 $ 128 48.84% y $ 3,000 $ 1,228 $ 1,772 40.93% "Utilities-Gas/Electric $ 51000 $ 14,805 $ (9,805) 296.11% 1k` `.' $ 81,000 $ 85,392 $ (4,392) 105.42% Utilities-Trash $ 700 $ - $ 700 0.00% j �`;, $ 8,400 $ 5,260 $ 3,140 62.62% Telephone $ 150 $ 124 $ 26 82.41% $ 1,800 $ 1,893 $ (93) 105.79% Insurance $ 521 $ - $ 521 0.00% $ 6,250 $ - $ 6,250 0.00% d i ,Total Expenses $ 32,421 $ 39,810 S (7,389) 122.79%VM $ 410,050 $ 690,307 $ (280,257) 168.35% 0penrtingincome 1, S, 40,454.: $ 29,592 $, (11;8,62� 464;450 $ 162p375 $ (302yV) 3496°l0 Equipment Replacement Reserve $ 13,000 $ 13,305 $ (305) 102,35% $ 156,000 $ 159,665 $ (3,665) 102.35% 27,484::.$ 15,287 $. Q1 J07)g1 55t68°�.° .t s ii L'�`$ 308 450yq($ ,�t2-710 $ (305w7,�40) Note: During the year Parkview Office Complex expensed$378,678 on the construction of a new roof system.(Sprayed Polyurethane Roof System), and,various other improvements.These expenditures will be capitalized and amortized over their useful life:recognized on a monthly basis as equipment replacement reserve.Below is the recalculated net income for the year after the tenant improvements are capitalized as fixed assets. . Net Income before adjustment $ 2,710 Add back:Cost for improvements $ 378,678 Adjusted Net Income $ 381,388 2003 Investment Reportlnv Report 2003 City of Palm Desert • Parkview Office Complex Vacancy Rate Schedule by Suite June 2003 Suite Square No. Tenant Feet 73-710 Fred Waring Drive-Two (2) Story Building 100 Hanover 1,915 100A EPA 645 102 Bergren 1,360 103 Multiple Sclerosis 488 104 Arthritis Foundation 960 106 Coachella Valley Economic Partnership 928 108 Assembly Rules Committee-Assemblyman Benoit 450 112 Senator Battin 1,741 114 Chamber of Commerce 1,478 118 Goodwill Industries 1,250 119 City/CVAG Conference Room 1,380 120 Duke Gerstal 1,750 200 CVAG 4,292 200A University of California Riverside 841 201 University of California Riverside 604 203 Mountain Conservancy 480 205 Vacant-Adopt-A-Class will move into suite in August 2003 700 208 Alzheimer's Association 960 210 Wilson, Pesota&P.ichardo 3,040 2003 Investment ReportVacancy Report P City of Palm Desert • t Parkview Office Complex Vacancy Rate Schedule by Suite June 2003 211 State of California Department of Food&Agriculture 937 217 Joe B. McMillan,. Esq. 775 220 Vacant-EPA will move into suite in August 2003 1,607 222 Cove Commission-Fire Marshal 1,900 222 CITY Storage-Vacant 1,081 Total square footage(2 story Building) 31,562 Vacancy Rate-3,388/31,562= 10.73% 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% 0.00% Overall Vacancy Rate for Both Buildings: Vacancy Rate-3,388/51,191 6.62% Occupancy Rate-47,803/51,191 9138% 2003 Investment ReportVacancy Report City of Palm Desert Desert Willow • Budget Vs Actual • For the month of May 2003 Budgeted Actual Budgeted Actual May May $ Percentage Year to Year to S Percentage Revenue 2003 2003 Variance Variance Date Date Variance Variance Course&Ground S 435,666 S 418,667 S (16,999) 96.10% $ 4,426,272 S 4,274,236 S (152,036) 96.57% Carts $ 31,562 S 43,735 S 12,173 13&57% S 356,846 S 352,280 S (4,566) 98.72% Golf5hop $ 73,240 S 73,701 S 461 100.63% S 743,202 S 756,517 $ 13,315 101.79% Range $ 1,500 $ 3,070 S 1,570 204,67% S 33,650 S 39,529 S 5,879 117.47% Food&Beverage 5 142,393 S 151,736 S 9,343 106.56% $ 1,387,519 S 1,496,079 S 108,560 107.82% Interest Income $ 600 S 1,971 S 1,371 328.50% S 6,150 S 3,668 S (2,482) 59.64% -rota)Revenues 684 61 S 692.880 S 7.919 1U1.16% S 6.953.639 5 6922 09 1330 99.55 Payroll Proshop $ 3,082 S 5,306 S (2,224) 172.16% S 49,840 S 48,302 S 1,539 96.91% Can $ 30,99.0 S 25,684 S 5,306 82.88% $ 274,628 S 253,383 S 21,245 92.26% Course&Ground S 128,193 S 123,107 S 5,086 96.03% S 1,392,208 S 1,359,087 S 33,121 97.62% Golf Operations S 28,336 S 27,452 S 884 96.88% $ 313,170 $ 278,373 $ 34,797 98.89% General&Administration S 41,467 $ 37,190 S 4,277 89,69% S 450,895 $ 397,111 $ 53,784 88.07% Food&Beverage $ 66,065 S 71,345 $ (5,280) l07.99% $ 635,302 $ 710,114 S (74,812) 111.78% Total-PaITOIL S 298.133290.084 S 8.049 97.30% S 3.116.043 5 3.046370 69.673 27.76%1 Other Expenditures Perimeter landscaping $ - $ - $ - 0.00% $ - $ - $ - 0.00% Proshop S 755 S 3,115 S (2,360) 412.58% S 38,060 $ 49,694 S (11,634) 130.57% Proshop-COGS S 40,014 S 37,454 S 2,560 93.60% $ 405,632 S 344,229 S 61,403 84.86% Can 5 14,395 S 14,293 $ 112 99.22% S 161,395 $ 150,441 S 10,954 93,21% Course&Ground-Noah Course $ 45,982 $ 46,661 S (679) 101.49% S 622,117 S 587,767 $ 34,350 94.48% Course&Ground-South Course S 45,424 S 51.176 S (5,752) 112.66% S 581,406 $ 577,922 $ 3,484 99.40% Course&Ground-Desch Pallet-N $ 950 S 676 S 274 71.16% $ 13,120 S 11,052 S 2,068 84.24% Course&Ground-Desert Pallet-S S 1,540 S 676 $ 864 43.90% S 14,350 S 8,369 S 5,981 58.32% Gol(Operations $ 800 S 449 $ 351 56.13% S 13,470 S 14,144 S (674) 105.00% General&Administration $ 65,212 $ 75,555 $ (10,343) 115.86% S 767,256 $ 844,029 $ (76,773) 110.01% Range $ 125 S 39 S 86 31.20% S 14,423 S 11,973 $ 2,452 83.00% Food&Beverage $ 12,260 $ 12,017 S 243 98.02% $ 154,320 S 161,483 S (7,163) 104.64% Food&Beverage COGS $ 44,221 S 55,652 $ (11,431) 125.85% S 434,834 S 479,614 $ (44,780) 110.30% Management Fee S 25,000 S 25,000 $ - 100.00% S 275,000 $ 275,000 S - 100,00% Financing/Lease $ 3,341 S 6,339 S (2,998) 189.73% S 22,814 S 49,886 $ (27,072) 218.66% Toalthen 300.019 2 092 (29.0731 109.69% S 3,518.1993.565.603 47 404 01.35% Desert Willow Golf Academy Desert Willow Golf Academy S 8,750 $ 14,638 S 5,888 167.29% $ 128,450 S 116,437 $ (12,013) 90.65% COGS-Merchandise $ (9,303) $ (3,968) S 5,335 42,65% $ (94,148) $ (49,652) $ 44,496 52.74% Other Eapendimres $ (1,775) S (9,129) $ (7,354) 514.31% S (24,199) $ (55,391) $ (31,193) 229.91% S Learning Center Income(Loss) $ (2,328) $ 1.541 $ 3.869 -66.19% S 10,104 S 11,394 $ 1,290 112.77% Operating Income(Loss) $ 84,481 S 75,245 S (9,236) 89.07% $ 329,501 $ 321,730 $ (7,771) 97.64% Equipment Reserve Replacement $ 71,955 S 66,734 S (5,221) 92.74% $ 791,505 $ 734,074 S (57,431) 92.74% Net In ame Lass 12,526 5 8 511 (4,015) 67.95° 5 f462,004) (412,3441 49.660 89.25° Sna shot of Golf Rounds Budgeted ma Actual um Variance Variance% Budgeted td Actual [d Variance Variance% Resident 1,100 1,582 482 144% 17,780 19,591 1,811 110% Non Resident 5,128 6,286 11158 123% 46,312 45,772 (540) 99% Other - - - 0% 177 177 100% Complimentary 375 560 185 149% 4139 3829 310 93% 7'0121 6,603 8,428 1,825 128% 68,231 69,369 1,138 102% Folder:Desert Willow 2001:Dw2003;F1nandal Statement Page 1 © � 7 ) § N ~ t \ § | § ] } +� . k ® $ \ \ \ \} ) \ / \ \ ) ) {) k } / \ ( G 0 / $ § ! , ka � ■ a 2 {! \ ! 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C nEEA2< C e r c 0 v P 877. 88oGobo 8 i 'sv 0 ., eece�ar#xN�a° a 3 ce 8 :rc 0^a qK� vnnv env o cecececececececececece v � _rvo88888885 m 9zA _e8^6SMaNNa $, oO oee eoo t= E6 n � U _v rvrv- . . . . . _:° 6P aO 43 `z $acecemcececececece a � „$cecececececececece � _R��$p^_ �E n _ rrrna �.•• 8�.nnmmm8.e.^w8 8 � -y vv V � > :c Fza Z R B�W6B�E Rr66P eP g^ r yp orc rrgrn�N$no � '8 -rvnr�v n25$ a_ rv_N�rvnry � �o Fy°O -n ran 3o'fi 'a Z `off f�6 a Z m mCm nce�� .n-Cm & n y. -v�a .^n S^n „tlt�XXwX:°T'XX BP ey _ ry rvrvn �= gmn 8 }9� _rvvv __ rvry �� - mr wme - aZ %ce�ce�'Ncecececece _ ��vv _ &e.o U fyC I � 5 � uxEEpu.cYdi y a.6G'eExEE2' cw EEry a'uY�Y>zoSuS<2 U <'m�FSi AM5 U ;a.%b'i o.``,u Ea'2 ['� 0 0 OD Scl !; � ■ � | j / + ` K � 2 • : 2 , ` ° g » | !� A ! \ � 2 ■ ■ |; ] } �� 2 e | 22 $ | \ FO a \ ! ] i \ I ^ ; & " | � ! 00 / , { 2 } � y . - ; ) ■ ■ u 2 a ! - | ! § ) a I f ! \ ) Desert Willow • Breakdown of Rounds • per point of sale system Desert Willow - Combined Analysis- MAY 2003 Resident 1,582 $ 69,450.00 $ 43.90 18.80% Non-Resident 6,286 $ 386,192.00 $ 61.44 74.60% Other - $ - $ 0.00% Complimentary 560 $ 5,305.00 $ 9.47 6.60% Desert Willow Totals 1 8,4281 $ 460,947 54.69 100.00% Du2003;POS AVG PD Page 9 Desert Willow • Breakdown of Rounds • per point of sale system FIRECLIFF COURSE- MAY 2003 Description No. Of Revenue Avg. Per Pet to Rounds Per POS Round Total Resident Rounds Resident Fee-Weekday 666 $ 29,090 $ 43.68 15A5% Total Resident 666 29,090 43.68 15.151% Non Resident Posted Weekday 486 $ 52,460 $ 107.94 11.05% IROC Des. PRTY - Weekday 65 $ 3,540 $ 54.46 1.48% IROC Member Guest- Weekday 47 $ 3,828 $ 81.45 1.07% Wholesale Weekday 988 $ 59,704 $ 60.43 22.47% Twilight 751 $ 33,680 $ 44.85 17.08% _Outing 969 $ 56,566 $ 58.38 22.04% Fee Special Event Variable 185 $ 12,785 $ 69.11 4.21% Total Non Resident Rounds 3,491 222,563 63.75 79.40% Other Rounds Junior Walking $ 0.00%$ Total Other 0.00% Complimentary VIP 38 $ - $ 0.86% PGA Member 101 $ 1,825 $ 18.07 2.309/. Employee / Employee Guest 101 Is 200 $ 1.98 2.30% Total Complimentary 240 2,025 8.44 5.46% Total Round (FireCuf 4,397 $ 253,678 $ 57.69 100.00% Dw2003;POS AVG RD Page 10 Desert Willow Breakdown of Rounds per point of sale system MOUNTAINVIEW COURSE- MAY 2003 _ Description No. Of Revenue Avg. Per Pet to Rounds Per POS Round Total Resident Rounds Resident Fee-Weekday 916 $ 40,360 $ 44.06 22.72% Total Resident 9161 $ 40,360 44.06 22.72% j Non Resident Posted Weekday 67 $ 8,040 $ 120.00 1.66% IROC Des. PRTY- Weekday 72 $ 3,890 $ 54.03 1.79% IROC Member/ Guest - Weekday 51 $ 4,264 $ 83.61 1.27% Wholesale Weekend 4 $ 220 $ 55.00 0.10% Wholesale Weekday 1,079 $ 65,950 $ 61.12 26.77% Desert Willow Players Club 3 $ 240 $ 80.00 0.07% Outing 603 $ 35,710 $ 59.22 14.96% Twilight 772 $ 35,480 $ 45.96 19.15% Fee Special Event Variable 144 $ 9,835 $ 68.30 3.570% Total Non Resident Rounds 2,795 163,629 58.54 69.34% Other Rounds Junior Walking $ $ 0.00% Total Other 0.00% Complimentary VIP 53 $ $ 1.31% PGA Member 77 $ 1,275 $ 16.56 j 1.919/. Champions Club 36 $ - $ - 0.89% Employee / Employee Guest 154 $ 2,0 55 $ 13.02 3.82% Total Complimentary 1 320 IT-3,2801 10.251 7.94% Total Round (Mountainview� 4,031 $ 207—,2-69—fl $ 51.42 10000 Qw2003;PGs AVG RD Page 11 City of Palm Desert • Desert Willow Cash Reserve Analysis for the month of May 2003 Cash Reserve Analysis One Month [Required Reserve $ 500,000.00 Cash on Hand $ 821,833.18 Variance- Favorable Unfavorable $ 321,833.18 Page 12 — I Palmsert Recreation Facilities Corpo9ion Income Statement May-03 May-03 N % Budget Actual Variance Variance Food & Beverage Revenues $142,393 $151,736 $9,343 106.56% Total Revenues $142,393 $151,736 $9,343 106.56% Salaries $66,065 $71,345 ($5,280) 107.99% Cost of Goods Sold-F&B $44,221 $55,652 ($11,431) 125.85% Food & Beverage Expense $12,260 $1,217 $11,043 9.93% Total Expenses $122,546 $128,214 ($5,668) 104.63% Net Income (Loss) $19,847 $23,522 $3,675 118.52% Note: The above revenues and expenditures are also included in the Desert Willow analysis. Dw2003;PDRFC Budget Page I