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Home My WebLink AboutAudit Invstmnt & Finance Cmte - 06/22/2010 �� MINUTES � � REGULAR MEETING OF THE PALM DESERT AUDIT, INVESTMENT, AND FINANCE COMMITTEE Tuesday, June 22, 2010 I. CALL TO ORDER Chairman Gibson called to order a regular meeting of the Palm Desert Audit, Investment and Finance Committee at 10:02 a.m. II. ROLL CALL Present: Absent: Paul Gibson, Finance Director Thomas Jeffrey, Deputy City Treasurer Cindy Finerty, Mayor Robert A. Spiegel, Council Member John Wohlmuth, City Manager r"t?'�'sc'��t1°-,CtLAC7'►��T Justin McCarthy, ACM/Redevelopment nE'E'a�()vR�'.�� _ ��;;��,) David Erwin, City Attorney 1zl=Ci?1�'�:t��F� e�-� �{�._�a Jono Hildner, Committee Member Patricia Kent, Committee Member M�H��NG DATr l � -l �� G�C James Walker, Committee Member �Yr�� 'e � '� �� jGn �n� � �. ' �� Everett Wood, Committee Member Nt)F,S: h�n�. A13SENT: N�� Also Present: AI3STAIN: N cn e� VERIF[ED BY: �- - r� Jan Harnik, Public Citizen al an File wifh Ci Cler�c s Oftice Anthony Hernandez, Senior Financial A��f� h' Richard Mogensen, Desert Willow Golf Resort Niamh Ortega, Recording Secretary Veronica Tapia, RDA Accountant II1. ORAL COMMUNICATIONS None. IV. APPROVAL OF MINUTES A. MINUTES OF THE REGULAR MEETING OF MAY 25, 2010 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 May 25, 2010. G:\Finance\Niamh Ortega\Investment Committee\2010\Minutes 062210.docx AUDIT, INVESTMENT, AND FINANCE COMMITTEE MINUTES June 22 2010 V. NEW BUSINESS A. CITY AND REDEVELOPMENT AGENCY INVESTMENT SCHEDULES AND SUMMARY OF CASH REPORTS FOR MAY 2010 Member Gibson presented the report and highlighted the following points: The book value of the City Portfolio for the period ended May 31, 2010 was approximately $266.1 million. Yield-to-maturity was approximately 1.25%. The book value of the Redevelopment Agency Portfolio for the period ended May 31, 2010 was approximately $299.7 million. Yield-to-maturity was approximately 0.69%. Member Gibson also reported that a number of securities had been purchased in an amount of$40 million for RDA and $6 million for the City. MOTION was made by Member Finerty and seconded by Member Walker to recommend that the City Council receive and file the City and Redevelopment Agency Investment Schedules and Summary of Cash Reports for May 2010 as presented. Motion unanimously approved. B. LOCAL AGENCY INVESTMENT FUND (L A I F ) ACCOUNT STATEMENTS FOR MAY 2010 MOTION was made by Member Finerty and seconded by Member Wood to receive and file the Local Agency lnvestment Fund account statements for May 2010 as presented. Motion unanimously approved. C. CALIFORNIA ASSET MANAGEMENT PROGRAM (C A M P ) ACCOUNT STATEMENTS FOR MAY 2010 MOTION was made by Member Finerty and seconded by Member Walker to receive and file the California Asset Managemenf Program account statements for May 2010 as presented. Motion unanimously approved. D. CITY FINANCIAL REPORTS AND REDEVELOPMENT AGENCY FINANCIAL REPORTS FOR MAY 2010 Chairman Gibson reported that the first quarter sales tax report has been received, and it indicated that sales tax is down 2.5%. Total revenues at year-end are expected to be $44 million versus expenditures of $42 2 AUDIT, INVESTMENT, AND FINANCE COMMITTEE MINUTES June 22 2010 million. Street resurfacing has not yet gone out to bid, and it is expected that revenues will be equal to expenditures following job completion. MOTION was made by Member Finerty and seconded by Member Wood to receive and file the City financial reports for May 2010 as presented. Motion unanimously approved. Ms. Tapia reviewed the monthly revenues and expenses for the Redevelopment Agency. Year-to-date actual for the end of May 2010 was $93 million in revenue and $106 million in expenditures. MOTION was made by Member Finerty and seconded by Member Walker to receive and file the Redevelopment Agency financial reports for May 2010 as presented. Motion unanimously approved. E. PARKVIEW PROFESSIONAL OFFICE BUILDINGS FINANCIAL REPORTS FOR MAY 2010 Monthly revenue is above budget because a lease was signed in November with the State Agriculture Department. The tenant improvements are for the Water Resources Board. At June 30, Suite 102 will be vacant because the Cove Commission will be occupying space at City Hall. Following the opening of the new Sheriff Station, there is a period of 180 days for them to vacate the current building next to City Hall. Staff is in negotiations with the Sheriff's department to use some of the space for their dispatch and substation operations. There are a number of leases expiring over the next 18 to 24 months, so there may be a need to use more of the space within the old station. Currently, staff is waiting on a proposal from the Sheriff's department to present to Council. F. PALM DESERT GOLF COURSE FACILITIES CORPORATION FINANCIAL REPORTS FOR MAY 2010 Mr. Mogensen reported that May was another successful month. Overall, the facility was $43,579 over budget and approximately $190,000 over last year. The rounds mix was up 1,107 rounds over last year. Mr. Mogensen reminded staff that last year on May 18, the Mountain View course was taken offline for renovations, resulting in nine or ten days where they did not have comparable revenue to this year. Year-to-date revenues continue to be about $309,000 under budget, and the bottom line is about $154,599 over budget. Food & Beverage was below budget but over last year. 3 AUDIT, INVESTMENT, AND FINANCE COMMITTEE MINUTES June 22 2010 Resident play was down slightly last month, but the VIP card has done extremely well with close to 700 sold this year, versus 89 last year. There has been a good mix of business, although it has been at a slightly lower average daily rate. Group business was 1,996 rounds last month, versus last year's 1,106. G. SPECIAL GAS TAX STREET IMPROVEMENT FUND FOR THE PERIOD OF JULY 1 2007 THROUGH JUNE 30 2008 Chairman Gibson reported that the City had been audited by the State for the Special Gas Tax Street Improvement Fund, and there had been no findings. MOTION was made bv Member Finertv and seconded bv Member Walker to recommend that the Cit Council receive and file the Spec�al Gas Tax Street Improvement Fund for the period of Julv 1, 2007 throuqh June 30 2008 as presented Motion unanimouslv approved. VI. CONTINUED BUSINESS None. VII. OLD BUSINESS A. PALM DESERT FINANCING AUTHORITY BOND ISSUANCE None. VIII. INFORMATIONAL ITEMS None. IX. ADJOURNMENT There being no further business, this meeting, upon motion duly made, seconded and carried was adjourned at 10:18 a.m. to the next regular meeting of July 27, 2010. i Niamh Ortega, ecording Secretary 4 �� MINUTES REGULAR MEETING OF THE PALM DESERT � AUDIT, INVESTMENT, AND FINANCE COMMITTEE Tuesday, July 27, 2010 I. CALL TO ORDER Chairman Gibson called to order a regular meeting of the Palm Desert Audit, Investment and Finance Committee at 10:02 a.m. II. ROLL CALL Present: Absent: Paul Gibson, Finance Director James Walker, Committee Member Luis Espinoza, Assistant Finance Director Thomas Jeffrey, Deputy City Treasurer Cindy Finerty, Mayor (10:25 a.m.) Robert A. Spiegel, Council Member John Wohlmuth, City Manager Justin McCarthy, ACM/Redevelopment David Erwin, City Attorney Jono Hildner, Committee Member Patricia Kent, Committee Member Everett Wood, Committee Member Also Present: Jan Harnik, Public Citizen Anthony Hernandez, Senior Financial Analyst Richard Mogensen, Desert Willow Golf Resort Niamh Ortega, Recording Secretary Nitin Patel, CPA, Diehl, Evans & Associates Veronica Tapia, RDA Accountant III. ORAL COMMUNICATIONS None. G:\Finance\Niamh Ortega\Investment Committee\2010\Minutes 072710.docx AUDIT, INVESTMENT, AND FINANCE COMMITTEE MINUTES Julv 27 2010 IV. APPROVAL OF MINUTES A. MINUTES OF THE REGULAR MEETING OF JUNE 22 2010 MOTION was made by Member Spiege/ and seconded by Member Wood to adopt and approve in their entirety the Minutes of the regular meeting of the Palm Desert Audit, lnvestment and Finance Committee held on June 22, 2010. V. NEW BUSINESS A. CITY AND REDEVELOPMENT AGENCY INVESTMENT SCHEDULES AND SUMMARY OF CASH REPORTS FOR JUNE 2010 Member Jeffrey presented the report and highlighted the following points: The book value of the City Portfolio for the period ended June 30, 2010 was approximately $201.9 million. Interest earnings were approximately $227,000. Yield-to-maturity was approximately 1.16%. The book value of the Redevelopment Agency Portfolio for the period ended June 30, 2010 was approximately $302.6 million. Interest earnings were approximately $200,000. Yield-to-maturity was approximately 0.78%. MOTION was made by Member Finerty and seconded by Member Hildner to recommend that the City Council receive and file the City and Redevelopment Agency lnvestment Schedules and Summary of Cash Reports for June 2010 as presented. Motion unanimously approved. B. LOCAL AGENCY INVESTMENT FUND (L A I F ) ACCOUNT STATEMENTS FOR JUNE 2010 MOTION was made by Member Hildner and seconded by Member Wood to receive and file the Local Agency lnvestment Fund account statements for June 2010 as presented. Motion unanimously approved. C. CALIFORNIA ASSET MANAGEMENT PROGRAM (C A M P ) ACCOUNT STATEMENTS FOR JUNE 2010 MOTION was made by Member Hildner and seconded by Member Wood to receive and file the California Asset Management Program account statements for June 2010 as presented. Motion unanimously approved. 2 AUDIT, INVESTMENT, AND FINANCE COMMITTEE MINUTES Julv 27 2010 D. CITY FINANCIAL REPORTS AND REDEVELOPMENT AGENCY FINANCIAL REPORTS FOR JUNE 2010 Chairman Gibson reported that the report reflects June 30 Period 12. Periods 13 and 14 occur during July and August to accrue additional items such as property taxes, franchise fees, sales tax, TOT and other payments that are received in July and August that apply to the prior year. Member Gibson discussed the payment due to JPIA for the City's insurance premium. Approximately 122 entities participate in this program, and Palm Desert's net payment for FY 10-11 will be approximately $400,000. MOTION was made by Member Hildner and seconded by Member Wood to receive and file the City financial reports for June 2010 as presented. Motion unanimously approved. Ms. Tapia reviewed the monthly revenues and expenses for the Redevelopment Agency. Year-to-date actual for the end of May 2010 was $96.6 million in revenue and $108.5 million in expenditures. MOTION was made by Member Hildner and seconded by Member Wood to receive and file the Redevelopment Agency financial reports for June 2010 as presented. Motion unanimously approved. E. PARKVIEW PROFESSIONAL OFFICE BUILDINGS FINANCIAL REPORTS FOR JUNE 2010 Mr. Hernandez reported that income was better than budget by $79,000 and expects an additional $80,000 to be added to the bottom line as a result of the tenant improvements being performed. It is possible if the State does not have an adopted budget that the City will receive IOUs for the rent due over the next few months. Since the aquatic center will be located in the park, revenue earned from the Parkview building could be used for the operation of the pool as per City Ordinance. MOTION was made by Member Hildner and seconded by Member Wood to receive and file the Parkview Professional Office Buildings financial reports for June 2010 as presented. Motion unanimously approved. F. PALM DESERT GOLF COURSE FACILITIES CORPORATION FINANCIAL REPORTS FOR JUNE 2010 3 AUDIT, INVESTMENT, AND FINANCE COMMITTEE MINUTES Julv 27 2010 Mr. Mogensen reported that June was a challenging month. Revenue was short by $74,000, but over last year by $115,000. Last year the Mountain View course was under renovation and was offline. Costs were well controlled, with payroll $30,000 under budget. Year-to-date resulted in $383,000 under revenue, but exceeded last year in total revenue by about $120,000. Mr. Mogensen also reviewed the rounds mix report, and indicated that 760 loyalty cards have been sold this year. The ADR year-to-date is only about eighty cents off last year. The parking lot renovation is due to start in August, and the terrace expansion and kitchen is expected to begin shortly if approved at the upcoming Council meeting. MOTION was made by Member Spiegel and seconded by Member Hildner to receive and file the Palm Desert Golf Course Facilities Corporation financial reports for June 2010 as presented. Motion unanimously approved. G. DISCUSSION RELATIVE TO AUGUST 24 2010 REGULAR MEETING Chairman Gibson stated that the annual audit is due to take place in September, and typically the Committee goes dark to allow staff time to prepare. MOTION was made bv Member Hildner and seconded bv Member Wood to recommend that the Audit lnvestment & Finance Committee adiourn to the September meetinq, cancellinq the Auqust 24, 2010 meetinq. Mot�on unanimouslv approved VI. CONTINUED BUSINESS None. VII. OLD BUSINESS A. PALM DESERT FINANCING AUTHORITY BOND ISSUANCE Member McCarthy reported that staff is in the process of community outreach in respect to the Palm Desert Country Club undergrounding, and have found that some residents are concerned about moving forward with an assessment district while the future of the golf course and its impact on home values in the neighborhood is uncertain. Staff will continue to reach out to the community and expects to bring something to Council for 4 AUDIT, INVESTMENT, AND FINANCE COMMITTEE MINUTES Julv 27 2010 consideration in October or November with respect to the most appropriate direction for the project. VIII. INFORMATIONAL ITEMS A. MEET AND CONFER WITH CITY OF PALM DESERT AUDITORS FROM DIEHL, EVANS & ASSOCIATES Nitin Patel, CPA gave a summary of the expectations of the auditing firm with respect to the auditing standards, internal controls and review of financial statements. At the end of the audit, the firm will communicate any findings or significant events to City staff. Auditors will perform an audit of the City and its entities including the Redevelopment Agency, Desert Willow and the Housing Authority properties. Mr. Patel reviewed the timeline of when fieldwork will be conducted. Following question and discussion, Mr. Patel indicated that contract compliance does not fall within the scope of this particular audit; it would be a separate engagement if the City desired such an audit. Expenditures, however, are reviewed in this audit to ensure that the financial information is correctly reported. No action was taken on this item. IX. ADJOURNMENT There being no further business, this meeting, upon motion duly made, seconded and carried was adjourned at 10:47 a.m. to the next regular meeting of September 28, 2010. �/ Niamh Ortega, ecording Secretary 5