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Home My WebLink AboutMinutes Audit Investment and Finance Committee 09/22/09 MINUTES � � REGULAR MEETING OF THE PALM DESERT AUDIT, INVESTMENT, AND FINANCE COMMITTEE Tuesday, September 22, 2009 I. CALL TO ORDER Chairman Gibson called to order a regular meeting of the Palm Desert Audit, Investment and Finance Committee at 10:00 a.m. II. ROLL CALL Present: Absent: Paul Gibson, Finance Director Luis Espinoza, Asst. Finance Director , , , � Thomas Jeffrey, Deputy City Treasurer � ' ; Robert A. Spiegel, Mayor � ! � Cindy Finerty, Mayor Pro-Tempore � John Wohlmuth, City Manager � � Justin McCarthy, ACM/Redevelopment � David Erwin, City Attorney � j .� Stephanie Loog, Community Member � p; � �a James Wa l ker, Communi ty Me m b e r z = �� • � '� Everett Wood, Community Member �, O ': �-+ � Also Present: � � "� Anthony Hernandez, Senior Financial Analyst 0 , � q � Richard Mogensen, Desert Willow � �,; Niamh Ortega, Recording Secretary � Veronica Tapia, RDA Accountant ''t - w �: Derek White, Desert Willow �j W Q - ,� � ` � � J o n a H i l d n e r, P u b l i c M e m b e r � w A � � z P � O > � . � r: �� _ III. ORAL COMMUNICATIONS V � � " � �' =- W- � a � �-- G. U G�" ��s`. L :A. °�i.� � '8� � ^ :�` None. U4a � Qz � � 1 � IV. APPROVAL OF MINUTES A. MINUTES OF THE REGULAR MEETING OF JULY 28�2009 MOTION was made by Member Spiegel and seconded by Member Erwin to adopt and approve in their entirety the minutes of the regular meeting of the Palm Desert Audit, Investment and Finance Committee held on July 28, 2009. G:\Finance\Niamh Ortega\Investment Committee�2009\Minutes\Minutes 092209.docx AUDIT, INVESTMENT, AND FINANCE COMMITTEE MINUTES _ SEPTEMBER 22. 2009 V. NEW BUSINESS A. CITY AND REDEVELOPMENT AGENCY INVESTMENT SCHEDULES AND SUMMARY OF CASH REPORTS FOR JULY AND AUGUST 2009 Member Jeffrey presented the report highlighted the follovving points: The book value of the City Portfolio for the period ended August 31, 2009 was approximately $228.4 million. Interest earnings were approximately $332,000. Yield-to-maturity was approximately 1.79%. The book value of the Redevelopment Agency Portfolio for the period ended August 31, 2009 was approximately $275.9 million. Interest earnings were approximately $277,000. Yield-to-maturity was approximately 1.19%. Mr. Jeffrey stated that there would not likely be a change in the Federal funds rate until Quarter 4 of 2010, and most likely not until 2011 in order to be confident that the expected recovery has some strength. B. LOCAL AGENCY INVESTMENT FUND (L.A.I.F.) ACCOUNT STATEMENTS FOR JULY AND AUGUST 2009 Mr. Jeffrey reported that the current interest rate is 0.8%. The older securities are maturing and are being reinvested at the current rates. C. CALIFORNIA ASSET MANAGEMENT PROGRAM (C.A.M.P.) ACCOUNT STATEMENTS FOR JULY AND AUGUST 2009 The report was received and filed. D. CITY FINANCIAL REPORTS FOR AUGUST AND REDEVELOPMENT AGENCY FINANCIAL REPORTS FOR JULY AND AUGUST 2009 Chairman Gibson noted that Period 14 was included in the packet. This period included all adjustments that are required for the fiscal year ending June 30, 2009. He also noted that with regard to the Wells Fargo loan, approximately $1.9 million of the $2.5 million has been repaid to the General Fund. Chairman Gibson pointed out that most of the revenues in July are accrued into June 2009. The report for August 2009 shows that revenues are approximately $4.07 million, but not all reversals of revenues have hit for August. Prior year was $2.9 million, and this year is comparable. Expenditures are slightly down from last year. The expenditures also include the twelve early retirements for July and August. The budget was reduced by nineteen positions over last year. Mr. Gibson indicated he would provide the amount that was accrued for the twelve employees at the next regular meeting. Ms. Tapia reported that RDA revenues were $526,000 and expenditures were approximately $1.4 million. The revenue is primarily interest and rent, and 2 AUDIT, INVESTMENT, AND FINANCE COMMITTEE MINUTES SEPTEMBER 22. 2009 expenditures are capital projects and some administrative costs, including 3 retirements at a cost of approximately $300,000. Member Spiegel updated the Committee on the status of the RDA case against the State, in which the State is proposing a take of $22 million from RDA for this year. Payment will not be made until closer to the date due, if it is still required to do so. E. PARKVIEW PROFESSIONAL OFFICE BUILDINGS FINANCIAL REPORTS FOR JULY AND AUGUST 2009 The improvements for the State Department of Rehabilitation are complete. The elevator has also been upgraded with additional lighting and new panels. Two spaces are still available for lease at the Parkview building. F. PALM DESERT GOLF COURSE FACILITIES CORPORATION FINANCIAL REPORTS FOR JULY AND AUGUST 2009 Mr. White reported that revenues were $354,700 versus a budget of $435,950, and a prior year of $531,000. Mountain View course renovation is ongoing. The retention of the rounds for that course has not been as high as hoped. Payroll expenses have indicated a savings of 3 percent and almost 9 percent savings over prior year. Overall, the bottom line indicates a $767,000 loss versus a budgeted loss of $827,000 for this year. Last year saw a loss of $674,000. September is expected to bring in lower revenues than usual, but there is some improvement in catering revenues. The Mountain View course will be available for play on October 30, then the Firecliff course will be overseeded beginning a week later. Dining has seen the average check drop approximately $3 or $4, and dinners are minimal. Reduced numbers of attendees at charity events contribute to lower revenues also. It is hoped that revenues will be close to the budgeted amounts for September and October 2009. G. REVIEW OF INVESTMENT POLICY Mr. Jeffrey highlighted the proposed changes to the Investment Policy as noted on the draft included in the agenda packet. The Committee approved of all changes and suggested that JP Morgan be added to the list of authorized companies on Page 24, and to add the revised date on the cover page of the Policy. It was also suggested that a note be added to Section 12.0 on page 18 regarding the fluctuation in the FDIC insurance rate. The broker list will be revised at a future date. MOTION to recommend that the City Council accept the changes to the Investment Policy as proposed in the draft Policy, and 1) add JP Morgan to the list of authorized companies on Page 24; 2) add a note to Section 12.0 regarding the fluctuation in the FDIC rate; and 3) add the revision date to 3 AUDIT, INVESTMENT, AND FINANCE COMMITTEE MINUTES SEPTEMBER 22 2009 the cover page. Motion made by Member Finerty, seconded by Member Wood, and unanimously approved. H. QUARTERLY ACCOUNT STATEMENTS ON DEFERRED COMPENSATION PLANS AND RETIREMENT HEALTH SAVINGS PLAN This item was reviewed and placed on file. VI. CONTINUED BUSINESS None. VII. OLD BUSINESS A. PALM DESERT FINANCING AUTHORITY BOND ISSUANCE The Welis Fargo transaction is complete. The RDA bond issue of $1.1 million was also finalized. Staff is looking into additional Energy Program bonds up to $5 million for the next stage of the program. The waiting list will be fully funded as of the most recent bond issue. The intention is to secure additional funding before taking any more applications or establishing a new waiting list. VIII. INFORMATIONAL ITEMS None. IX. ADJOURNMENT There being no further business, this meeting, upon motion duly made, seconded and carried was adjourned at 10:40 a.m. to the next regular meeting of October 27, 2009. � �. 1��1� Niamh Ortega, cording Secretary 4