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Home My WebLink AboutSR - Compliance Analysis & Invstmnt Rprts Feb & Mar 2010x � C CITY OF PALM DESERT FINANCE DEPARTMENT INTEROFFICE MEMORANDUM TO: RACHELLE KLASSEN, CITY CLERK FROM: NIAMH ORTEGA, RECORDING SECRETARISI'NO� DATE: MAY 10, 2010 SUBJECT: COMPLIANCE ANALYSIS AND INVESTMENT REPORTS Please find attached the Compliance Analysis and Investment Reports forwere presented and approved at the recent meetings of the Audit, Investment and Finance Committee for the months of .CYbrri•,+ N4,_ 2010. Please include the report on the upcoming agenda for review and acceptance by City Council. Also included are the minutes of the December and January meetings for acceptance by the City Council. Please feel free to contact me at Ext. 382 if you have any questions. Thank you. nmo Attachment (as noted) L: s: BY RDA IFe e/ C ,��sc ON o VERIFIED BY __4L_4_ Original on file with City Clerk's Office CITY COUNCIL ACTION APPROVED DENIED RECEIVED OTHER MEETINGDATE AYES: bei- n , AeJ-l'-T= NOES: nl o4 r ABSENT: ABSTAIN:' VERIFIED BY: Original on File with City Clerks Office GARNANCE\NIAMH ORTEGA\INVESTMENT COMMITTEE\MEMOS\RKLASSENINVREPORT.WPD .� City of Palm Desert City and Redevelopment Agency Portfolios COMPLIANCE ANALYSIS AND INVESTMENT REPORT February 2010 Paul S. Gibson, C.C.M.T., Treasurer Thomas W. Jeffrey, J.D., M.B.A., Deputy City Treasurer Treasurer's Commentary Goldman Sachs is forecasting that the U.S. economy will grow at an annual rate of 1.5% in the second half of 2010, before accelerating in 2011. U.S. unemployment is expected to rise to 10.5% by early 2011. Goldman believes that the "jobless recovery" pattern of the 1991-92 and 2001-03 recessions is a good template for the next two years. Based upon the foregoing, and the fact that the Federal Reserve has never raised interest rates during a period of rising unemployment, short-term interest rates are not expected to increase until 2011. Goldman's forecast is predicated upon the following structural constraints: (1) consumers boosting savings out of current income; (2) weakness in labor income due to high unemployment and employers' reluctance to rehire; (3) the weak fiscal position of the public sector; (4) large overhangs of vacant homes and unused industrial capacity; and (5) limited credit availability for small businesses. The FDIC currently has 702 lenders on its list of "troubled" banks, the highest level since 1993. The FDIC expects bank failures in 2010 to exceed the 140 recorded in 2009. In 2009, bank lending experienced its sharpest decline since 1945. U.S. Treasury yields fell in February due to increased demand as buyers reacted to concerns over the financial stability of southern EU countries, and the U.S. economy's ability to grow after the removal of the government stimulus. Pas c.C.A r City Treasurer PORTFOLIO STATISTICS Dollars in Thousands FEB-10 JAN-10 DEC-09 NOV-09 OCT-09 SEP-09 CITY Month -End Book Value*" $ 200,124 $ 218,094 $ 202,229 $ 201,381 $ 239,207 $ 232,393 Month -End Market Value*** $ 201,136 $ 219,068 $ 203,250 $ 202,521 $ 240,435 $ 233,526 Paper Gain (Loss) $ 1,012 $ 974 $ 1,021 $ 1,140 $ 1,228 $ 1,133 Prior Year Book Variance $ (19,345) $ 5,356 $ 3,176 $ (12,226) $ 21,577 $ 21,716 Interest Earnings $ 227 $ 221 $ 314 $ 315 $ 326 $ 322 Yield -To -Maturity 1.41 % 1.31 % 1.82% 1.93% 1.69% 1.74% Weighted Maturity (Days) 455 419 230 255 246 253 Effective Duration 0.35 0.35 0.15 0.17 0.17 0.18 RDA Month -End Book Value "* $ 304,221 $ 287,243 $ 256,271 $ 261,734 $ 226,007 $ 265,942 Month -End Market Value *** $ 304,733 $ 287,788 $ 256,897 $ 262,477 $ 226,811 $ 266,805 Paper Gain (Loss) $ 512 $ 545 $ 626 $ 743 $ 804 $ 863 Prior Year Book Variance $ 33,805 $ 5,970 $ 4,419 $ 17,060 $ (19,093) $ 8,557 Interest Earnings $ 168 $ 183 $ 262 $ 257 $ 186 $ 227 Yield -To -Maturity 0.69% 0.72% 1.21 % 1.21 % 0.96% 0.95% Weighted Maturity (Days) 223 236 188 185 214 192 Effective Duration 0.34 0.38 0.16 0.17 0.21 0.19 *** Omits SLGSs. City of Palm Desert -- Portfolio Characteristics February 28, 2010 Dollars in Thousands Aaeina Interval Market Value < 1 M $ 43,150 General Fund Ageing < 2M 3,000 < 3M 6,049 100 < 6M 8,230 80 < 1YR 22,505 < 2YR 26,519 2 60 < 3YR 33,034 40 30 119 23 16 n < 4YR - a° 20 I I ? < 5YR I I I I - 0 0 0 > 5YR _ 0 Total: $ 142,487 < 1 M < 2M < 3M < 6M < < < < < > 1YR 2YR 3YR 4YR 5YR 5YR Ratings * Market Value (Credit Quality AAA $ 129,305 AAA AA 21,697 Unrated ** 65% A 7,061 21 % Unrated ** 41,810 A AA Total: $ 199,873 3% 11% Sector Market Value Asset Allocation CAMP MMF $ 34,997 Agencies , y,,,:.• 23% Agencies 70,579 35% _ MTNs MTNs 28,758 14% CAMP 3,339 MMF RDA Loan RDA Loan 22,655 18% 11 % LAIF 39,545 LAIF Total: $ 199,873 20% Month Citv Yield LAIF Yield Variance Performance Mar09 2.17 1.82 0.35 Apr 2.09 1.61 0.49 2.4 May 2.04 1.53 0.51 Jun 2.03 1.38 0.65 1.6 Jul 1.90 1.04 0.86 - Aug 1.79 0.93 0.87 2 r Sep 1.74 0.76 0.98 0.8:' Oct 1.69 0.65 1.05 Nov 1.93 0.61 1.32 0.0 - Dec 1.82 0.57 1.26 Mar094pr May Jun Jul Aug Sep Oct Nov Dedan10=eb Jan10 1.31 0.56 0.76 Feb 1.41 0.58 0.83 ® n * Standard and Poors ** LAIF, and City Loan to RDA Page 2 City of Palm Desert Portfolio Holdings February 28, 2010 Market Ratings Par Value I Issuer l Coupon j Maturity I Cost I YTM I Price I Value Moody's S&P Medium -Term Notes $ 3,795,000 BANK OF AMERICA 5.38 8/15/11 $ 3,862,637 4.05 105.43 $ 4,001,027 A2 A $ 3,000,000 BANK OF AMERICA 4.25 10/1/10 $ 3,017,486 3.20 102.00 $ 3,060,027 A2 A $ 2,035,000 GENERAL ELECTRIC 4.88 10/21/10 $ 2,026,359 5.63 102.75 $ 2,090,914 Aa2 AA+ $ 1,891,000 GENERAL ELECTRIC 6.88 11/15/10 $ 1,905,284 5.65 104.46 $ 1,975,409 Aa2 AA+ $ 2,000,000 GENERAL ELECTRIC 6.13 2/22/11 $ 2,007,764 5.67 105.21 $ 2,104,202 Aa2 AA+ $ 3,965,000 GENERAL ELECTRIC 4.88 10/21/10 $ 4,004,598 3.23 102.75 $ 4,073,942 Aa2 AA+ $ 39000,000 TOYOTA 4.35 12/15/10 $ 3,092,236 0.44 103.16 $ 3,094,800 Aal AA $ 2,000,000 WACHOVIA 7.80 8/18/10 $ 2,023,672 5.02 103.19 $ 2,063,804 Al AA $ 4,000,000 WELLS FARGO BANK 6.38 8/1/11 $ 4,062,303 5.13 106.43 $ 4,257,248 Al AA $ 2,000,000 WELLS FARGO BANK 4.63 8/9/10 $ 1,996,302 5.09 101.83 $ 2,036,602 Al AA $ 27,686,000 Subtotal $ 27,998,642 4.08 $ 28,757,974 Agencies -- Coupon $ 3,000,000 FED FARM CREDIT BANK 4.78 5/3/10 $ 3,000,805 4.61 100.81 $ 3,024,375 Aaa AAA $ 39000,000 FED FARM CREDIT BANK 4.78 5/3/10 $ 3,000,805 4.61 100.81 $ 3,024,375 Aaa AAA $ 3,000,000 FED FARM CREDIT BANK 3.50 10/3/11 $ 3,119,269 0.97 104.22 $ 3,126,563 Aaa AAA $ 3,0009000 FED HOME LOAN BANK 1.63 7/27/11 $ 3,033,234 1.18 101.34 $ 39040,313 Aaa AAA $ 3,000,000 FED HOME LOAN BANK 0.44 10/7/10 $ 3,002,144 0.32 100.06 $ 3,001,875 Aaa AAA $ 3,000,000 FED HOME LOAN BANK 1.63 3/16/11 $ 3,035,301 0.41 101.22 $ 3,036,563 Aaa AAA $ 2,062,000 FED HOME LOAN MTG CORP 4.13 7/12/10 $ 2,065,513 5.47 101.47 $ 2,092,286 Aaa AAA $ 3,000,000 FED HOME LOAN MTG CORP 1.63 4/26/11 $ 3,0339861 0.60 101.28 $ 39038,438 Aaa AAA $ 39000,000 FED HOME LOAN MTG CORP 4.13 2/24/11 $ 3,1059640 0.52 103.47 $ 3,104,063 Aaa AAA $ 2,000,000 FED NATIONAL MTG ASSOC 4.25 8/15/10 $ 1,989,683 5.47 101.88 $ 2,037,500 Aaa AAA $ 3,000,000 FED NATIONAL MTG ASSOC 1.75 12/28/12 $ 2,995,699 1.91 100.34 $ 3,010,313 Aaa AAA $ 31,062,000 Subtotal $ 31,381,952 2.16 $ 31,536,661 Agencies -- Callable $ 3,000,000 FED HOME LOAN BANK 1.00 10/28/11 $ 3,000,000 1.00 100.25 $ 3,007,500 Aaa AAA $ 3,000,000 FED HOME LOAN BANK 1.38 6/11/12 $ 2,994,325 2.01 100.03 $ 3,000,938 Aaa AAA $ 15,000,000 FED HOME LOAN BANK 1.38 6/28/12 $ 14,971,595 1.82 100.13 $ 15,018,750 Aaa AAA $ 2,980,000 FED HOME LOAN BANK 1.88 11/19/12 $ 2,986,220 1.61 100.06 $ 2,981,863 Aaa AAA $ 3,000,000 FED HOME LOAN BANK 1.85 12/21/12 $ 3,000,895 1.82 100.06 $ 3,001,875 Aaa AAA $ 3,000,000 FED HOME LOAN MTG CORP 1.25 1/26/12 $ 3,000,000 1.25 100.36 $ 3,010,713 Aaa AAA $ 6,000,000 FED NATIONAL MTG ASSOC 1.75 12/28/12 $ 5,991,749 1.90 100.34 $ 6,020,625 Aaa AAA $ 35,980,000 Subtotal $ 35,944,785 1.71 $ 36,042,263 Agencies -- Discount $ 3,000,000 FED HOME LOAN BANK 0.00 4/13/10 $ 2,999,440 0.07 99.99 $ 2,999,700 Aaa AAA $ 3,000,000 Subtotal $ 2,999,"0 0.07 $ 2,999,700 "U" = Unrated Page 3 City of Palm Desert Portfolio Holdings February 28, 2010 Par Value I Issuer I Coup Local Agency Investment Fund $ 39,545,341 L.A.I.F. 0.00 $ 39,545,341 Subtotal Local Agency Investment Fund $ 3,331,875 C.A.M.P. 0.00 $ 7,328 C.A.M.P. (DESERT WILLOW) 0.00 $ 3,339,204 Subtotal Money Market Fund $ 34,996,633 WF ADVANTAGE GOVT MMF 0.00 $ 34,996,633 Subtotal City Loan to RDA $ 22,655,000 CITY OF PALM DESERT 0.00 $ 22,655,000 Subtotal Total Investments $ 198,264,177 Cash $ 275,367 CITY MAIN CHKG 0.00 $ 866,018 DESERT WILLOW CHKG 0.00 $ 122,044 RECREATIONAL FAC CHKG 0.00 $ 1,263,429 Subtotal Total Investments and Cash $ 199,527,606 Market on I Maturity Cost YTM I Price I Value 3/1/10 $ 39,545,341 0.58 100.00 $ 39,545,341 $ 39,545,341 0.58 $ 39,545,341 3/1/10 $ 3,331,875 0.19 100.00 $ 3,331,875 3/1/10 $ 7,328 0.19 100.00 $ 7,328 $ 3,339,204 0.19 $ 3,339,204 Ratings Moody's 1 S&P U U U U AAA AAA` 3/1/10 $ 34,996,633 0.00 100.00 $ 34,996,633 Aaa AAA $ 34,996,633 0.00 $ 34,996,633 1 3/1/40 $ 22,655,000 0.58 100.00 $ 22,655,000 $ 22,655,000 0.58 $ 22,655,000 $ 198,860,996 1.41 $ 199,872,775 3/1/10 $ 275,367 0.00 100.00 $ 275,367 3/1/10 $ 866,018 0.00 100.00 $ 866,018 3/1/10 $ 122,044 0.00 100.00 $ 122,044 $ 1,263,429 $ 1,263,429 $ 200,124,424 $ 201,136,204 U U U U U j U U U "U" = Unrated Page 4 Par Value City of Palm Desert Portfolio Holdings February 28, 2010 Market Issuer Coupon I Maturity Cost YTM I Price I Value % of Portfolio Corporate Issuers (Market Value) BANK OF AMERICA 3.51% GENERAL ELECTRIC 5.09% TOYOTA 1.54% WACHOVIA 1.03% WELLS FARGO BANK 3.13% % of Portfolio Agency Issuers (Market Value) FED FARM CREDIT BANK 4.56% FED HOME LOAN BANK 19.43% FED HOME LOAN MTG CORP 5.59% FED NATIONAL MTG ASSOC 5.50% Ratings Moody's I S&P "U" = Unrated Page 5 Dollars in Thousands Aaeina Interval < 1 M < 2M < 3M < 6M < 1 YR < 2YR < 3YR < 4YR < 5YR > 5YR Total: Quailt AAA AA A Unrated Total: Sector MMF Agencies MTNs CAMP LAIF EIP LAIF/Bond Proceeds Total: Palm Desert Redevelopment Agency -- Portfolio Characteristics February 28, 2010 Market Value $ 99,290 3,030 13,972 31,557 3,842 3,151 $ 154,842 Market Value $ 66,231 98,594 10,132 129,056 $ 304,013 Market Value $ 57,706 36,151 16,249 61,699 39,731 3,151 89,326 $ 304,013 Month RDA Yield LAIF Yield Mar09 1.07 1.82 Apr 1.05 1.61 May 1.06 1.53 Jun 1.30 1.38 Jul 1.31 1.04 Aug 1.19 0.93 Sep 0.95 0.76 Oct 0.96 0.65 Nov 1.21 0.61 Dec 1.21 0.57 Jan10 0.72 0.56 Feb 0.69 0.58 Portfolio Ageing w/o SLGSs 100 .......- i 80 64 j 0 60 ` t 40 0 20 j CL 20 0 0 2 nn 2 0 0 0 rl 1 1 <lM<2M<3M<6M < < < < < > 1YR 2YR 3YR 4YR 5YR 5YR E [Credit QualitA AA 32% A AAA 3% 22% Unrated " 43% Asset Allocation MTNs Agencies 5% CAMP 20% 12%ZEIP MMFLAIF 19%13% 1% LAIF/Bond Proceeds 30% i Variance Performance -0.75 -0.56 2.1 - .-... -0.47 i -0.08 1.4 0.27 0.26 d =� 0.7 1 0.19 = j 0.32 it 0.59 0.0 0.64 Mar09Apr May Jun Jul Aug Sep Oct Nov DecJan10Feb 0.16 ` ®LAIFYield ORDAYield / 0.12 L- - --- Standard and Poors LAIF Page 6 Palm Desert Redevelopment Agency Portfolio Holdings February 28, 2010 Market Ratings Par Value Issuer Coupon Maturity I Cost J YTM Price I Value Moody's S&P Medium -Term Notes $ 3,000,000 ABBOTT LABS 3.75 3/15/11 $ 3,097,667 0.60 102.92 $ 3,087,516 Al AA $ 3,450,000 BEAR STEARNS (JPM) 6.95 8/10/12 $ 3,869,420 1.83 111.37 $ 3,842,393 Aa3 A+ $ 3,000,000 JP MORGAN CHASE 3.13 12/1/11 $ 3,116,084 0.69 0.00 $ 3,116,084 Aa3 A+ $ 3,000,000 JP MORGAN CHASE 5.60 6/1/11 $ 3,176,670 0.85 105.78 $ 3,173,541 Aa3 A+ $ 3,000,000 WAL-MART 4.13 7/1/10 $ 3,011,652 2.91 101.00 $ 3,029,919 Aa2 AA 1 $ 15,450,000 Subtotal $ 16,271,494 1.39 $ 16,249,453 Agencies -- Coupon $ 4,900,000 FED FARM CREDIT BANK 4.90 9/22/10 $ 4,906,550 4.65 102.56 $ 5,025,563 Aaa AAA $ 2,000,000 FED HOME LOAN BANK 4.88 3/11/11 $ 1,988,135 5.49 104.53 $ 2,090,625 Aaa AAA $ 2,000,000 FED HOME LOAN BANK 4.88 3/11/11 $ 1,987,977 5.50 104.53 $ 2,090,625 Aaa AAA $ 2,890,000 FED HOME LOAN BANK 2.88 3/11/11 $ 2,960,425 0.49 102.44 $ 2,960,444 Aaa AAA $ 3,000,000 FED HOME LOAN BANK 0.50 11/29/10 $ 3,004,656 0.36 100.09 $ 3,002,813 Aaa AAA $ 3,000,000 FED HOME LOAN BANK 1.13 12/9/11 $ 3,010,240 0.96 100.53 $ 3,015,938 Aaa AAA $ 2,000,000 FED HOME LOAN MTG CORP 6.88 9/15/10 $ 2,012,667 5.54 103.66 $ 2,073,125 Aaa AAA $ 3,734,000 FED HOME LOAN MTG CORP 6.88 9/15/10 $ 3,757,692 5.54 103.66 $ 3,870,524 Aaa AAA $ 2,940,000 FED NATIONAL MTG ASSOC 1.75 3/23/11 $ 2,979,021 0.43 101.34 $ 2,979,506 Aaa AAA $ 9,000,000 FED NATIONAL MTG ASSOC 1.00 11/23/11 $ 9,009,208 1.00 100.47 $ 9,042,188 Aaa AAA 1 $ 35,464,000 Subtotal $ 35,616,571 2.59 $ 36,151,349 Local Government Investment Pool $ 39,708,598 L.A.I.F. 0.00 3/1/10 $ 39,708,598 0.58 100.00 $ 39,708,598 U U $ 22,059 L.A.I.F. (HOUSING) 0.00 3/1/10 $ 22,059 0.58 100.00 $ 22,059 U U $ 39,730,658 Subtotal $ 39,730,658 0.58 $ 39,730,658 Local Government Investment Pool $ 17,445,313 CITY OF PALM DESERT 0.00 3/1/10 $ 17,445,313 0.58 100.00 $ 17,445,313 U AA $ 4,797,836 CITY OF PALM DESERT 0.00 3/1110 $ 4,797,836 0.58 100.00 $ 4,797,836 U AA $ 25,119,364 CITY OF PALM DESERT 0.00 3/1/10 $ 25,119,364 0.58 100.00 $ 25,119,364 U AA $ 10,361,506 CITY OF PALM DESERT 0.00 3/1/10 $ 10,361,506 0.58 100.00 $ 10,361,506 U AA $ 15,112,739 CITY OF PALM DESERT 0.00 3/1/10 $ 15,112,739 0.58 100.00 $ 15,112,739 U AA $ 16,488,631 CITY OF PALM DESERT 0.00 3/1110 $ 16,488,631 0.58 100.00 $ 16,488,631 U AA $ 89,325,389 Subtotal $ 89,325,389 0.58 $ 89,325,389 Local Government Investment Pool $ 59,588,016 C.A.M.P. 0.00 3/1/10 $ 59,588,016 0.19 100.00 $ 59,588,016 U AAA $ 2,111,452 C.A.M.P. (HOUSING) 0.00 3/1/10 $ 2,111,452 0.19 100.00 $ 2,111,452 U AAA $ 61,699,468 Subtotal $ 61,699,468 0.19 $ 61,699,468 "U" = Unrated Page 7 Palm Desert Redevelopment Agency Portfolio Holdings February 28, 2010 Market Ratings Par Value Issuer Coupon Maturity Cost JYTM Price I Value I Moody'sS&P� Money Market Fund $ 57,705,872 WF ADVANTAGE GOVT MMF 0.00 3/1/10 $ 57,705,872 0.00 100.00 $ 57,705,872 Aaa AAA $ 57,705,872 Subtotal $ 57,705,872 0.00 $ 57,705,872 Municipal Bonds $ 3,151,000 ENERGY INDEP PROGRAM 3.00 9/2129 $ 3,151,000 3.00 100.00 $ 3,151,000 U AA $ 3,151,000 Subtotal $ 3,151,000 3.00 $ 3,151,000 Total Investments $ 302,526,387 $ 303,500,451 0.69 $ 304,013,189 Cash $ 315,394 HOUSING AUTH CHKG 0.00 3/1/10 $ 315,394 0.00 100.00 $ 315,394 U U $ 404,669 HOUSING AUTH TRUST 0.00 3/1/10 $ 404,669 0.00 100.00 $ 404,669 U U $ 720,063 Subtotal $ 720,063 $ 720,063 Total Investments and Cash $ 303,246,449 $ 304,220,514 $ 304,733,252 % of Portfolio Corporate Issuers (Market Value) ABBOTT LABS 1.01% BEAR STEARNS (JPM) 1.26% JP MORGAN CHASE 2.06% WAL-MART 3.94% "U" = Unrated Page 8 I Par Value Palm Desert Redevelopment Agency Portfolio Holdings February 28, 2010 Issuer Agency Issuers Coupon I Maturity FED FARM CREDIT BANK FED HOME LOAN BANK FED HOME LOAN MTG CORP FED NATIONAL MTG ASSOC Cost % of Portfolio (Market Value) 1.65% 4.32% 1.95% 3.94% Market Ratings JYTMI Price I Value I Moody's I S&P "U" = Unrated Page 9 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 Audit, Investment, and Finance Committee and the Palm Desert City Council review the Statement of Investment Policy annually. For the month ended February 28, 2010, 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. Interactive Data Corporation provided the data that was 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 March 23, 2010, Pis (id,-som C. C R r City Treasurer SUMMARY OF AUTHORIZED INVESTMENTS I California Government Code I 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 0.0% 1.0% 53632(c) Savings Accounts No Limit No Limit No Limit No Limit 53601(b) U.S. Treasuries 5 Years No Limit 5 Years No Limit 0.0% 0.0% 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% 6% 35.4% 11.7% 53601(f) Bankers's Acceptances 180 Days 40% 180 Days 40% A-1 & P-1 - - 53601(g) Commercial Paper 270 Days 25% A-1+ or P-1 270 Days 25% A-1+ or P-1 0.0% 0.0% 53601(h) Negotiable CDs 5 Years 30% 5 Years 30% AA- or Aa3 - - 53601(i) Repos 1 Year No Limit 30 Days 20% AAA & Aaa - - 53601(i) Reverse Repos 92 Days 20% Not Authorized 536010) Medium -Term Notes 5 Years 0 30% A 5 Years 0/o 30 A IAAA&Aaal 14.. 1 0/0 54 0/o 53601(k) Mutual Funds 90 Days 20% AAA & Aaa 90 Days 20% (2) 17.6% 19.0% 53601(I) Trust Indenture Debt Not Authorized 53601(m) Secured Bank Deposits 5 Years No Limit Not Authorized 53601(k) Local Government AAA & Aaa AAA & AaaI Investment Pools 90 Days 20% or Advisor 90 Day s ( 20% 2) or Advisor 1 ( I 1.7% I 20.3% 53601(n) Mortgage -Backed 5 Years 20% A (Issuer) & Not Authorized Securities AA (Security) 16429.1(b) LAW No Limit No Limit I 19.9% ( 42.5% (1) The City loan to RDA, which is not a bond, has been approved by the Palm Desert City Council. 88.6% 100.0% (2) The City Energy Independence Program has been approved by the Palm Desert City Council. (3) Maximum limit for mutual funds and local government investment pools, excluding bond proceeds. Certified California Municipal Treasurer Page 10 City of Palm Desert City and Redevelopment Agency Portfolios COMPLIANCE ANALYSIS AND INVESTMENT REPORT March 2010 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) will meet next on April 27-28. No action on interest rates is expected. The FOMC acknowledges that a recovery is underway, but is wary of raising interest rates too soon, and triggering a double -dip recession. If anything, the low rate of inflation appears to be slowing further. Producer pricing power remains weak due to high levels of unemployment and weak wage growth. U.S. stock and bond markets approached milestones in April with the Dow Jones Industrial Average closing above 11000, and yields on 10-year U.S. Treasury notes trading above 4.00%. This was prompted by optimism over corporate profits, a recovering economy, and debt relief for Greece. Small investors, however, remained on the sidelines. Retail sales surged 1.6% in March, helped by federal tax refunds. The housing sector continues to be weak, however, and commercial real estate remains troubled. At this point, the recovery has been one of output, not jobs. The SEC filed a civil action for fraud against Goldman Sachs alleging that the firm had misled clients who had purchased derivative securities that quickly lost value. This action is part of a widening international probe of Goldman's operations. ' The SEC's lawsuit could cost Goldman as much as $700 million in civil fines and investor payments. The City of Palm Desert has no Goldman Sachs holdings since Goldman Sachs is not on the City's approved issuer list. Pis GdWiv, c.C.Af 7- City Treasurer PORTFOLIO STATISTICS Dollars in Thousands MAR-10 FEB-10 JAN-10 DEC-09 NOV-09 OCT-09 CITY Month -End Book Value- $ 197,952 $ 200,124 $ 218,094 $ 202,229 $ 201,381 $ 239,207 Month -End Market Value"" $ 198,665 $ 201,136 $ 219,068 $ 203,250 $ 202,521 $ 240,435 Paper Gain (Loss) $ 713 $ 1,012 $ 974 $ 1,021 $ 1,140 $ 1,228 Prior Year Book Variance $ (18,722) $ (19,345) $ 5,356 $ 3,176 $ (12,226) $ 21,577 Interest Earnings 227 $ 227 $ 221 $ 314 $ 315 $ 326 Yield -To -Maturity 1.43% 1.41 % 1.31 % 1.82% 1.93% 1.69% Weighted Maturity (Days) 465 455 419 230 255 246 Effective Duration 0.35 0.35 0.35 0.15 0.17 0.17 RDA Month -End Book Value " " $ 295,407 $ 304,221 $ 287,243 $ 256,271 $ 261,734 $ 226,007 Month -End Market Value "*" $ 295,786 $ 304,733 $ 287,788 $ 256,897 $ 262,477 $ 226,811 Paper Gain (Loss) $ 379 $ 512 $ 545 $ 626 $ 743 $ 804 Prior Year Book Variance $ 27,030 $ 33,805 $ 5,970 $ 4,419 $ 17,060 $ (19,093) Interest Earnings 174 $ 168 $ 183 $ 262 $ 257 $ 186 Yield -To -Maturity 0.70% 0.69% 0.72% 1.21 % 1.21 % 0.96% Weighted Maturity (Days) 229 223 236 188 185 214 Effective Duration 0.35 0.34 0.38 0.16 0.17 0.21 *** Omits SLGSs. Dollars in Thousands Aaeina Interval < 1 M < 2M < 3M < 6M < 1 YR < 2YR < 3YR < 4YR < 5YR > 5YR Total: Ratinas AAA AA A Unrated ** Total: Sector MMF Agencies MTNs CAMP RDA Loan LAW Total: Month Apr09 May Jun Jul Aug Sep Oct Nov Dec Jan10 Feb Mar Citv Yield 2.09 2.04 2.03 1.90 1.79 1.74 1.69 1.93 1.82 1.31 1.41 1.43 City of Palm Desert -- Portfolio Characteristics March 31, 2010 Market Value $ 48,221 6,049 8,230 25,542 23,482 33,034 $ 144,558 Market Value $ 102,654 21,565 7,043 64,200 $ 195,462 Market Value $ 30,132 70,382 28,608 2,140 22,655 41,545 $ 195,462 LAIF Yield 1.61 1.53 1.38 1.04 0.93 0.76 0.65 0.61 0.57 0.56 0.58 0.55 F % General Fund Ageing 100--______......_.._.____..._.._._-._._....._--..._....___.__._... i \ 80 c 60 0 33 40 0 18 116 20 n23 j H 4 0 6 I nI I I I I 0 0 0 j 0 ^, ^, <lM<2M<3M<6M < < < < < > 1YR 2YR 3YR 4YR 5YR 5YR [Credit Quality AAA 52% Unrated ** AA 33% A 11% 4% Asset Allocation MTNs 15% Agencies RD A Loan 36% ;., 12% CAMP M5 LAIF 23% 21% Variance Performance 0.49 0.51 2.4 0.65 0.86 a 1.6 _ 0.87 D 0.98 0.8 1.05 1.32 0.0 1.26 0.76 AprO9L4ayJun Jul Aug Sep Oct Nov Dedan1(Feb Mar 0.83 a o 0.88 Standard and Poors ** LAIF, and City Loan to RDA Page 2 I Par Value Medium -Term Notes $ 3,795,000 $ 3,000,000 $ 2,035,000 $ 1,891,000 $ 2,000,000 $ 3,965,000 $ 3,000,000 $ 2,000,000 $ 4,000,000 $ 2,000,000 $ 27,686,000 Agencies -- Coupon City of Palm Desert Portfolio Holdings March 31, 2010 Market Ratings Issuer lCouponj Maturity I Cost I YTM I Price I Value ' Moody'sI S&P BANK OF AMERICA 5.38 8/15/11 $ 3,858,765 4.05 105.11 $ 3,988,890 A2 A BANK OF AMERICA 4.25 10/1110 $ 3,014,988 3.20 101.81 $ 3,054,195 A2 A GENERAL ELECTRIC 4.88 10/21/10 $ 2,027,486 5.63 102.12 $ 2,078,120 Aa2 AA+ GENERAL ELECTRIC 6.88 11/15/10 $ 1,903,596 5.65 103.76 $ 1,962,194 Aa2 AA+ GENERAL ELECTRIC 6.13 2/22/11 $ 2,007,100 5.67 104.58 $ 2,091,642 Aa2 AA+ GENERAL ELECTRIC 4.88 10/21/10 $ 3,999,433 3.23 102.12 $ 4,049,014 Aa2 AA+ TOYOTA 4.35 12/15/10 $ 3,082,493 0.44 102.38 $ 3,071,367 Aal AA WACHOVIA 7.80 8/18/10 $ 2,019,420 5.02 102.58 $ 2,051,546 Al AA WELLS FARGO BANK 6.38 8/1/11 $ 4,058,638 5.13 105.79 $ 4,231,728 Al AA WELLS FARGO BANK 4.63 8/9/10 $ 1,997,004 5.09 101.46 $ 2,029,284 Al AA Subtotal $ 27,968,924 4.08 $ 28,607,981 $ 3,000,000 FED FARM CREDIT BANK $ 3,000,000 FED FARM CREDIT BANK $ 3,000,000 FED FARM CREDIT BANK $ 3,000,000 FED HOME LOAN BANK $ 3,000,000 FED HOME LOAN BANK $ 3,000,000 FED HOME LOAN BANK $ 2,062,000 FED HOME LOAN MTG CORP $ 3,000,000 FED HOME LOAN MTG CORP $ 3,000,000 FED HOME LOAN MTG CORP $ 2,000,000 FED NATIONAL MTG ASSOC $ 3,000,000 FED NATIONAL MTG ASSOC 1 $ 31,062,000 Subtotal Agencies -- Callable $ 3,000,000 FED HOME LOAN BANK $ 3,000,000 FED HOME LOAN BANK $ 15,000,000 FED HOME LOAN BANK $ 2,980,000 FED HOME LOAN BANK $ 3,000,000 FED HOME LOAN BANK $ 3,000,000 FED HOME LOAN MTG CORP $ 6,000,000 FED NATIONAL MTG ASSOC 1 $ 35,980,000 Subtotal Agencies -- Discount $ 3,000,000 FED HOME LOAN BANK $ 3,000,000 Subtotal 4.78 5/3/10 $ 3,000,415 4.61 100.41 $ 3,012,188 Aaa AAA 4.78 5/3/10 $ 3,000,415 4.61 100.41 $ 3,012,188 Aaa AAA 3.50 10/3/11 $ 3,113,014 0.97 103.91 $ 3,117,188 Aaa AAA 1.63 7/27/11 $ 3,031,264 1.18 101.09 $ 3,032,813 Aaa AAA 0.44 10/7/10 $ 3,001,846 0.32 100.03 $ 3,000,938 Aaa AAA 1.63 3/16/11 $ 3,032,477 0.41 101.00 $ 3,030,000 Aaa AAA 4.13 7/12/10 $ 2,067,664 5.47 101.09 $ 2,084,553 Aaa AAA 1.63 4/26/11 $ 3,031,413 0.60 101.09 $ 3,032,813 Aaa AAA 4.13 2/24/11 $ 3,096,662 0.52 103.09 $ 3,092,813 Aaa AAA 4.25 8/15110 $ 1,991,570 5.47 101.50 $ 2,030,000 Aaa AAA 1.75 12/28/12 $ 2,995,826 1.91 99.84 $ 2,995,313 Aaa AAA $ 31,362,565 2.16 $ 31,440,803 1.00 10/28/11 $ 3,000,000 1.00 100.03 $ 3,000,938 Aaa AAA 1.38 6/11/12 $ 2,994,533 1.46 99.88 $ 2,996,250 Aaa AAA 1.38 6/28/12 $ 14,972,613 1.82 99.81 $ 14,971,875 Aaa AAA 1.88 11/19/12 $ 2,986,029 1.61 100.53 $ 2,995,831 Aaa AAA 1.85 12/21/12 $ 3,000,868 1.82 99.63 $ 2,988,750 Aaa AAA 1.25 1/26/12 $ 3,000,000 1.25 99.90 $ 2,997,090 Aaa AAA 1.75 12/28/12 $ 5,991,993 1.90 99.84 $ 5,990,625 Aaa AAA $ 35,946,036 1.67 $ 35,941,359 0.00 4/13/10 $ 2,999,440 0.07 100.00 $ 3,000,000 Aaa AAA $ 2,999,"0 0.07 $ 3,000,000 "U" = Unrated Page 3 City of Palm Desert Portfolio Holdings March 31, 2010 Market Ratings Par Value Issuer ICouponj Maturity I Cost I YTM I Price I Value I Moody's I S&P Local Agency Investment Fund $ 41,545,341 L.A.I.F. 0.00 4/1/10 $ 41,545,341 0.55 100.00 $ 41,545,341 U U $ 41,545,341 Subtotal $ 41,545,341 0.55 $ 41,545,341 Local Agency Investment Fund $ 2,132,257 C.A.M.P. 0.00 4/1/10 $ 2,132,257 0.17 100.00 $ 2,132,257 U AAA $ 7,329 C.A.M.P. (DESERT WILLOW) 0.00 4/1/10 $ 7,329 0.17 100.00 $ 7,329 U AAA $ 2,139,586 Subtotal $ 2,139,586 0.17 $ 2,139,586 Money Market Fund $ 30,131,571 WF ADVANTAGE GOVT MMF 0.00 4/1/10 $ 30,131,571 0.00 100.00 $ 30,131,571 Aaa AAA $ 30,131,571 Subtotal $ 30,131,571 0.00 $ 30,131,571 City Loan to RDA $ 22,655,000 CITY OF PALM DESERT 0.00 4/1/40 $ 22,655,000 0.58 100.00 $ 22,655,000 U U $ 22,655,000 Subtotal $ 22,655,000 0.58 $ 22,655,000 Total Investments $ 194,199,498 $ 194,748,464 1.43 $ 195,461,641 Cash $ 1,544,491 CITY MAIN CHKG 0.00 4/1/10 $ 1,544,491 0.00 100.00 $ 1,544,491 U U $ 1,399,377 DESERT WILLOW CHKG 0.00 4/1/10 $ 1,399,377 0.00 100.00 $ 1,399,377 U U $ 259,674 RECREATIONAL FAC CHKG 0.00 4/1/10 $ 259,674 0.00 100.00 $ 259,674 U U $ 3,203,542 $ 3,203,542 $ 3,203,542 Total Investments and Cash $ 197,403,040 $ 197,952,006 $ 198,665,183 "U" = Unrated Page 4 I Par Value I Issuer Corporate Issuers BANK OF AMERICA GENERAL ELECTRIC TOYOTA WACHOVIA WELLS FARGO BANK Agency Issuers City of Palm Desert Portfolio Holdings March 31, 2010 lCouponj Maturity FED FARM CREDIT BANK FED HOME LOAN BANK FED HOME LOAN MTG CORP FED NATIONAL MTG ASSOC Cost % of Portfolio (Market Value) 3.55% 5.12% 1.55% 1.03% 3.15% % of Portfolio (Market Value) 4.60% 4.61 % 4.13% 2.53% Market Ratings YTM I Price I Value I Moody's I S&P "U" = Unrated Page 5 Palm Desert Redevelopment Agency -- Portfolio Characteristics March 31, 2010 Dollars in Thousands Aaeina Interval Market Value < 1 M $ 80,686 < 2M - < 3M - < 6M 13,999 < 1YR 16,212 < 2YR 18,342 < 3YR 3,842 < 4YR - < 5YR - > 5YR 3,151 Total: $ 136,232 d Portfolio Ageing w/o SLGSs 100--._._...___-._._ 80 I 59 c 60 t 40 a 20 10 12 13 0 0 n n n 3 0 0 2 I 0 <1M<2M<3M<6M < < < < < > 1YR 2YR 3YR 4YR 5YR 5YR t Credit Quality ualit Market Value AA AAA $ 139,797 2% A AA 6,099 AAA ° ° A 10,092 47% Unrated "* 139,056 Total: $ 295,044 Unrated *' 47% Sector Market Value Asset Allocation MTNs MMF $ 67,821 Agencies 6% CAMP Agencies 36,018 12% 11 % MTNs 16,191 LAIF CAMP 32,807 17% MMFZ1% 23 /° LAIF 49,731 EIP EIP 3,151 LAIF/Bond Proceeds 89,325 LAIF/Bond Proceeds Total: $ 295,044 30% Month RDA Yield LAIF Yield Apr09 1.05 1.61 May 1.06 1.53 Jun 1.30 1.38 Jul 1.31 1.04 Aug 1.19 0.93 Sep 0.95 0.76 Oct 0.96 0.65 Nov 1.21 0.61 Dec 1.21 0.57 Jan10 0.72 0.56 Feb 0.69 0.58 Mar 0.70 0.55 Variance Performance -0.56 -0.47 2.1 -0.08 0.27 1.4 0.26 L 32 0.19 d i 0.32 } 0.7 I 0.59 0.64 0.0 - 0.16 Apr09Vlay Jun Jul Aug Sep Oct Nov Dedan1(Feb Mar 0.12 L ®LAIF Yield aRDAYield i 0.15 - - * Standard and Poors ** LAIF Page 6 I Par Value Medium -Term Notes $ 3,000,000 $ 3,450,000 $ 3,000,000 $ 3,000,000 $ 3,000,000 $ 15,450,000 Agencies -- Coupon Palm Desert Redevelopment Agency Portfolio Holdings March 31, 2010 Market Ratings Issuer Coupon Maturity Cost YTM I Price I Value Moody'sI S&P ABBOTT LABS 3.75 3/15/11 $ 3,089,833 0.60 102.59 $ 3,077,766 Al AA BEAR STEARNS (JPM) 6.95 8/10/12 $ 3,855,106 1.83 110.78 $ 3,822,045 Aa3 A+ JP MORGAN CHASE 3.13 12/1/11 $ 3,110,556 0.69 0.00 $ 3,110,556 Aa3 A+ JP MORGAN CHASE 5.60 6/1/11 $ 3,164,892 0.85 105.31 $ 3,159,321 Aa3 A+ WAL-MART 4.13 7/1110 $ 3,008,739 2.91 100.72 $ 3,021,567 Aa2 AA Subtotal $ 16,229,126 1.39 $ 16,191,255 $ 4,900,000 FED FARM CREDIT BANK $ 2,000,000 FED HOME LOAN BANK $ 2,000,000 FED HOME LOAN BANK $ 2,890,000 FED HOME LOAN BANK $ 3,000,000 FED HOME LOAN BANK $ 3,000,000 FED HOME LOAN BANK $ 2,000,000 FED HOME LOAN MTG CORP $ 3,734,000 FED HOME LOAN MTG CORP $ 2,940,000 FED NATIONAL MTG ASSOC $ 9,000,000 FED NATIONAL MTG ASSOC 1 $ 35,464,000 Subtotal Local Government Investment Pool $ 49,708,598 L.A.I.F. $ 22,059 L.A.I.F. (HOUSING) $ 49,730,658 Subtotal Local Government Investment Pool $ 17,445,313 L.A.I.F. / WELLS FARGO $ 4,797,836 L.A.I.F. / WELLS FARGO $ 25,119,364 L.A.I.F. / WELLS FARGO $ 10,361,506 L.A.I.F. / WELLS FARGO $ 15,112,739 L.A.I.F. / WELLS FARGO $ 16,488,631 L.A.I.F. / WELLS FARGO 1 $ 89,325,389 Subtotal Local Government Investment Pool $ 30,694,929 C.A.M.P. $ 2,111,755 C.A.M.P. (HOUSING) $ 32,806,684 Subtotal 4.90 9/22/10 $ 4,905,573 4.65 102.19 $ 5,007,188 Aaa AAA 4.88 3/11/11 $ 1,989,097 5.49 104.03 $ 2,080,625 Aaa AAA 4.88 3/11/11 $ 1,988,952 5.50 104.03 $ 2,080,625 Aaa AAA 2.88 3/11/11 $ 2,954,715 0.49 102.13 $ 2,951,413 Aaa AAA 0.50 11/29/10 $ 3,004,135 0.36 99.94 $ 2,998,125 Aaa AAA 1.13 12/9/11 $ 3,009,758 0.96 100.25 $ 3,007,500 Aaa AAA 6.88 9/15/10 $ 2,010,708 5.54 103.09 $ 2,061,875 Aaa AAA 6.88 9/15/10 $ 3,754,028 5.54 103.09 $ 3,849,521 Aaa AAA 1.75 3/23/11 $ 2,975,956 0.43 101.13 $ 2,973,075 Aaa AAA 1.00 11/23/11 $ 9,008,764 1.00 100.09 $ 9,008,438 Aaa AAA $ 35,601,686 2.59 $ 36,018,383 0.00 4/1/10 $ 49,708,598 0.55 100.00 $ 49,708,598 U U 0.00 4/1/10 $ 22,059 0.55 100.00 $ 22,059 U U $ 49,730,658 0.55 $ 49,730,658 0.00 4/1/10 $ 17,445,313 0.55 100.00 $ 17,445,313 U AA 0.00 4/1/10 $ 4,797,836 0.55 100.00 $ 4,797,836 U AA 0.00 4/1/10 $ 25,119,364 0.55 100.00 $ 25,119,364 U AA 0.00 4/1/10 $ 10,361,506 0.55 100.00 $ 10,361,506 U AA 0.00 4/1/10 $ 15,112,739 0.55 100.00 $ 15,112,739 U AA 0.00 4/1/10 $ 16,488,631 0.55 100.00 $ 16,488,631 U AA $ 89,325,389 0.55 $ 89,325,389 0.00 4/1/10 $ 30,694,929 0.17 100.00 $ 30,694,929 U AAA 0.00 4/1/10 $ 2,111,755 0.17 100.00 $ 2,111,755 U AAA $ 32,806,684 0.17 $ 32,806,684 "U" = Unrated Page 7 Palm Desert Redevelopment Agency Portfolio Holdings March 31, 2010 Market Ratings Par Value Issuer I Coupon] Maturity I Cost YTM Price Value ' Moody'sS&P Money Market Fund $ 67,820,800 WF ADVANTAGE GOVT MMF 0.00 4/1/10 $ 67,820,800 0.00 100.00 $ 67,820,800 Aaa AAA $ 67,820,800 Subtotal $ 67,820,800 0.00 $ 67,820,800 Municipal Bonds $ 3,151,000 CITY OF PALM DESERT 3.00 9/2/29 $ 3,151,000 3.00 0.00 $ 3,151,000 U AA $ 3,151,000 Subtotal $ 3,151,000 3.00 $ 3,151,000 Total Investments $ 293,748,530 $ 294,665,342 0.70 $ 295,044,168 Cash $ 331,404 HOUSING AUTH CHKG 0.00 4/1/10 $ 331,404 0.00 100.00 $ 331,404 U U $ 410,110 HOUSING AUTH TRUST 0.00 4/1/10 $ 410,110 0.00 100.00 $ 410,110 U U $ 741,515 Subtotal $ 741,515 $ 741,515 Total Investments and Cash $ 294,490,045 $ 295,406,857 $ 295,785,683 "U" = Unrated Page 8 Palm Desert Redevelopment Agency Portfolio Holdings March 31, 2010 I Par Value I Issuer I Coupon I Maturity I Cost % of Portfolio Corporate Issuers (Market Value) ABBOTT LABS 1.04% BEAR STEARNS (JPM) 1.29% JP MORGAN CHASE 2.12% WAL-MART 1.02% % of Portfolio Agency Issuers (Market Value) FED FARM CREDIT BANK 1.69% FED HOME LOAN BANK 4.44% FED HOME LOAN MTG CORP 2.00% FED NATIONAL MTG ASSOC 4.05% Market Ratings YTM I Price I Value ' Moody's I S&P "U" = Unrated Page 9 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 Audit, Investment, and Finance Committee and the Palm Desert City Council review the Statement of Investment Policy annually. For the month ended March 31, 2010, 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. Interactive Data Corporation provided the data that was 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 April 27, 2010, Pis tjdyj , c.C.R r City Treasurer SUMMARY OF AUTHORIZED INVESTMENTS California Government Code I 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 0.0% 1.1% 53632(c) Savinqs Accounts No Limit No Limit No Limit No Limit 53601(b) U.S. Treasuries 5 Years No Limit 5 Years No Limit 0.0% 0.0% 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 Aqencies 5 Years No Limit 5 Years 30% 6% 36.1 % 12.1 % 53601(f) Bankers's Acceptances 180 Days 40% 180 Days 40% A-1 & P-1 - - 53601(g) Commercial Paper 270 Days 25% A-1+ or P-1 270 Days 25% A-1+ or P-1 0.0% 0.0% 53601(h) Negotiable CDs 5 Years 30% 5 Years 30% AA- or Aaa 53601(1) Repos 1 Year No Limit 30 Days 20% AAA & Aaa - - 53601(1) Reverse Repos 92 Days 20% Not Authorized 53601(j) Medium -Term Notes ' 5 Years 30% A 5 Years 30% A 14.4% 5.5% 53601(k) Mutual Funds 90 Days 20% AAA & Aaa _ 90 Days 20% (2) IAAA&Aaal 15.5% 23.0% 53601(I) Trust Indenture Debt Not Authorized 53601(m) Secured Bank Deposits 5 Years No Limit Not Authorized 53601(k) I Local Government ( ( AAA & Aaa & Aaal Investment Pools 90 Days 20% or Advisor 90 Days I IAAA 20% (2) or Advisor 53601(n) I Mortgage -Backed 5 Years I 20% ( A (Issuer) & Not Authorized Securities AA (Security) 16429.1(b)l LAIF No Limit No Limit 21.3% 47.2% (1) The City loan to RDA, which is not a bond, has been approved by the Palm Desert City Council. I 88.4% I 100.0% (2) The City Energy Independence Program has been approved by the Palm Desert City Council. (3) Maximum limit for mutual funds and local government investment pools, excluding bond proceeds " Certified California Municipal Treasurer Page 10