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Home My WebLink AboutMinutes - Audit Investment Finance Committee 09/27/2011MINUTES REGULAR MEETING OF THE PALM DESERT AUDIT, INVESTMENT, AND FINANCE COMMITTEE ~ Tuesday, September 27, 2011 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 CI'I'Y COUNCILACTION' Bob Hargreaves, City Attorney A PPROV EI D '; :NIED Thomas Jeffrey, Deputy City Treasurer R["CFIN E0 '+-Fi IC Patricia Kent, Committee Member William Kroonen, Council Member INtl, V i Ik,(. 1)AlF, 3-:_DU/ � Justin McCarthy, ACM/Redevelopment AN: I, S: ,' ai'P�K, Arr)r)nel2, S� e Robert A. Spiegel, Mayor Pro Tempore NOES: NC11L Susan Marie Weber, Committee Member ABSENT: N LIE -- John Wohlmuth, City Manager ABSTAIN: LUIC Also Present: VERIFIED BY: . gn- k Ira Anthony Hernandez, Sr. Financial Analyst Original on File with City Clerk s Office Richard Mogensen, Desert Willow Golf Resort Niamh Ortega, Recording Secretary Ed Pack, Palm Desert resident Veronica Tapia, Redevelopment Accountant Derek White, Desert Willow Golf Resort III. ORAL COMMUNICATIONS Mr. Ed Pack introduced himself to the Committee, informing them that he had recently retired to Palm Desert from Hesperia, CA, where he served for eight years as a Council member. Mr. Gibson welcomed him to the meeting. IV. APPROVAL OF MINUTES A. MINUTES OF THE REGULAR MEETING OF JULY 26 2011 MOTION was made by Member Spiegel and seconded by Member Wohlmuth 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 26, 2011. Motion unanimously approved. G:Tinanceftamh Ortega\Investment Committee\201 1 \Minutes 092711.docx AUDIT, INVESTMENT, AND FINANCE COMMITTEE MINUTES SEPTEMBER 27. 2011 V. NEW BUSINESS A. CITY AND REDEVELOPMENT AGENCY INVESTMENT SCHEDULES AND SUMMARY OF CASH REPORTS FOR JULY AND AUGUST 2011 Member Jeffrey presented the report and highlighted the following points The book value of the City Portfolio for the period ended August 31, 2011 was approximately $206.7 million. Interest earnings were approximately $91,000. Yield -to -maturity was approximately 0.49%. The book value of the Redevelopment Agency Portfolio for the period ended August 31, 2011 was approximately $240.3 million. Interest earnings were approximately $117,000. Yield -to -maturity was approximately 0.58%. Mr. Jeffrey handed out a document titled, "20 Signs of Imminent Financial Collapse in Europe". Once Committee members had an opportunity to familiarize themselves with the contents, he summarized the most recent events concerning the possible Greek default and the trickle -down effect the situation would have on other European countries such as Italy, France and Ireland. The European economic crisis hits particularly close to home given that Palm Desert currently holds 22% of its investments in Rabobank, a Dutch bank whose main function is to serve as a global agri-business bank. Its structure is unusual in that it has no shareholders; rather, it operates as a co-op of farming banks, and controls 90% of Dutch farm loans. Two of the three main Dutch banks hold significant European debt; Rabobank does not. Staff highlighted that the City's investments are collateralized 110% through Union Bank, and Mr. Jeffrey stated that staff was comfortable with leaving the investments intact through Rabobank. The Committee preferred to exercise caution and suggested that funds be withdrawn from Rabobank for the month of October and discuss further options at a future meeting. MOTION was made by Member Spiegel and seconded by Member Wohlmuth that funds be withdrawn from Rabobank leaving $50,000 in each account to keep the accounts open; withdrawn funds should be invested in LAIF up to the maximum amount permitted, with remaining funds invested in CAMP for the month of October 2011. Motion approved. Member Hargreaves abstained due to the fact that Rabobank is his client. B. LOCAL AGENCY INVESTMENT POOL ACCOUNT STATEMENTS FOR JULY AND AUGUST 2011 MOTION was made by Member Spiegel seconded by Member Wohlmuth to receive and file the Local Agency Investment Fund (LAIF), California Asset Management Program (CAMP), Riverside County Investment Pool, and Rabobank Investment Pool statements for July and August 2011 as presented. Motion unanimously approved. 2 AUDIT, INVESTMENT, AND FINANCE COMMITTEE MINUTES SEPTEMBER 27 2011 C. CITY FINANCIAL REPORTS AND REDEVELOPMENT AGENCY FINANCIAL REPORTS FOR JULY AND AUGUST 2011 Chairman Gibson presented the City's report. He highlighted that August revenues were $1.5 million versus last year's amount of $1.7 million. TOT is still ahead of last year by $100,000. Actual expenditures were 3.3 million, and the Sheriff has not yet submitted their monthly billing. MOTION was made by Member Spiegel and seconded by Member Kent to receive and file the City of Palm Desert financial reports for July and August 2011 as presented. Motion unanimously approved. Ms. Tapia presented the RDA's report. Year to date revenues were $627,000 and expenditures were $6.8 million, the majority of which was debt service payments, fire station renovations and the College of the Desert Public Safety Academy payment. MOTION was made by Member Spiegel and seconded by Member Wohlmuth to receive and file the Redevelopment Agency financial reports for July and August 2011 as presented. Motion unanimously approved. D. PARKVIEW PROFESSIONAL OFFICE BUILDINGS FINANCIAL REPORTS FOR JULY AND AUGUST 2011 Mr. Hernandez reported that the operating income is better than budget by $23,000. Staff is currently working with a company to inspect the roof to determine how much it will cost to replace the roof cover. The recently -installed solar panels are now operational and connected to the single -story Parkview building. Vacancies are at 10%, and there has not been any interest expressed in those spaces. Staff has informed the State of its vacancies should there be an interest in office space. MOTION was made by Member Kent and seconded by Member Spiegel to receive and file the Parkview Professional Office Buildings financial reports for July and August 2011 as presented. Motion unanimously approved. E. PALM DESERT GOLF COURSE FACILITIES CORPORATION FINANCIAL REPORTS FOR JULY AND AUGUST 2011 Mr. White reported that August revenue was $482,000 versus a budget of $489,000 and last year totals of $420,000, Payroll was $662,000, significant savings from a budget of $741,000. Last year totals were $628,000. Expenses were $426,000 versus a budget of $439,000 and last year total of $449,000. Dollars per round increased 9% as the course saw more rounds at a higher dollar amount. The Mountain View course is closed this week for reseeding, which may affect next month's report. Private party trends are positive, while group business is slow and challenging. 3 AUDIT, INVESTMENT, AND FINANCE COMMITTEE MINUTES SEPTEMBER 27 2011 October and November should be good months, and it is anticipated that the revenues and expenditures will be in line with budgeted amounts for the current month. MOTION was made by Member Wohimuth and seconded by Member Spiegel to receive and file the Palm Desert Golf Course Facilities Corporation financial reports for July and August 2011 as presented. Motion unanimously 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 10:38 a.m. to the next scheduled meeting of October 25, 2011. C_ Niamh Ortega, R 11 rding Secretary 51