HomeMy WebLinkAboutSR - Investment Rprts - May through August 2010CITY OF PALM DESERT
FINANCE DEPARTMENT
INTEROFFICE MEMORANDUM
TO: RACHELLE KLASSEN, CITY CLERK
FROM: NIAMH ORTEGA, RECORDING SECRETARY'S
DATE: SEPTEMBER 28, 2010
SUBJECT: COMPLIANCE ANALYSIS AND INVESTMENT REPORTS
Please find attached the Compliance Analysis and Investment Reports which were
presented and approved at the recent meetings of the Audit, Investment and Finance
Committee for the months of May through August 2010. Please include the report on the
upcoming agenda for review and acceptance by City Council.
Also included are the minutes of the June and July meetings for acceptance by the City
Council.
Please feel free to contact me at Ext. 382 if you have any questions.
y B�'l RDA
ON IC- IL1 C,
nmo
VEFiiEIED BY A
Attachment (as noted)
Originsl on file with City Clerk's Office
CITY COUNCIL ACTION
APPROVED 1)EN1 1 W 1)
RECEIVED f r`le 01 I11:1Z
MEETING DATE
AYES: bt11- z-1,) Ae1-au5r 501) �sr�;nr�a �'� I
NOES: N n/i J
ABSENT: M cn C
ABSTAIN: _U 00 C.-
VERIFIED BY:
Original on File with City Clerk's Office
GAFINANCE\NIAMH ORTEGA\INVESTMENT COMM ITTEE\MEMOS\RKLASSENINVREPORT.WPD
City of Palm Desert
City and Redevelopment Agency Portfolios
COMPLIANCE ANALYSIS AND INVESTMENT REPORT
May 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 June 22-23. Many economists have reversed their position
of a month ago, and now believe that there is little likelihood that the FOMC will raise short-term interest rates anytime
soon. This reassessment was prompted by the European debt crisis, low inflation, and meager job growth.
The European debt crisis continued to widen. On June 4, Hungary announced that it was in danger of defaulting on its debt.
Runs began on Hungary's currency and debt; the Euro fell below $1.20 for the first time; and the Dow Jones Industrial
Average closed below 10,000. Bond investors reacted by demanding higher yields on public debt issued by Greece, Italy,
Spain, Portugal, France, Belgium, and Austria. Nervous investors purchased U.S. Treasuries, pushing yields down near the
bottom for this year.
Robert Reich, former Secretary of Labor for the Clinton Administration, has argued that the U.S. is falling into a double -dip
recession. He cited a deteriorating labor market; the rising average length of unemployment; falling median wages; and
weak consumer spending, as factors. Reich stated that four temporary boosts have so far kept the U.S. economy out of a
double dip: (1) the federal stimulus (75% of which has been spent); (2) near -zero interest rates; (3) capital replacements
(e.g., cars and appliances); and (4) the hiring of Census workers. When these boosts end, Reich believes that the U.S. will
be in a dip unless the Federal Government provides more stimulus.
pa"'lls tiav�, C.C.. Al. r.
City Treasurer
PORTFOLIO STATISTICS
Dollars in Thousands
MAY-10
APR-10
MAR-10
FEB-10
JAN-10
DEC-09
CITY
Month -End Book Value""'
$
206,132
$ 203,292
$
197,952
$
200,124
$
218,094
$
202,229
Month -End Market Value***
$
206,723
$ 203,969
$
198,665
$
201,136
$
219,068
$
203,250
Paper Gain (Loss)
$
591
$ 677
$
713
$
1,012
$
974
$
1,021
Prior Year Book Variance
$
(18,157)
$ (14,671)
$
(18,722)
$
(19,345)
$
5,356
$
3,176
Interest Earnings
222
246
227
$
227
$
221
$
314
Yield -To -Maturity
1.25%
1.41 %
1.43%
1.41 %
1.31 %
1.82%
Weighted Maturity (Days)
604
655
465
455
419
230
Effective Duration
0.57
0.63
0.35
0.35
0.35
0.15
RDA
Month -End Book Value ***
$
299,721
$
285,335
$ 295,407
$
304,221
$
287,243
$ 256,271
Month -End Market Value ***
$
299,998
$
285,685
$ 295,786
$
304,733
$
287,788
$ 256,897
Paper Gain (Loss)
$
277
$
350
$ 379
$
512
$
545
$ 626
Prior Year Book Variance
$
6,001
$
32,808
$ 27,030
$
33,805
$
5,970
$ 4,419
Interest Earnings
171
175
174
$
168
$
183
$ 262
Yield -To -Maturity
0.69%
0.74%
0.70%
0.69%
0.72%
1.21 %
Weighted Maturity (Days)
226
237
229
223
236
188
Effective Duration
0.31
0.34
0.35
0.34
0.38
0.16
*** Omits SLGSs.
City of Palm Desert -- Portfolio Characteristics
May 31, 2010
Dollars in Thousands
Aaeina Interval Market Value
< 1 M $ 60,327 General Fund Ageing
< 2M 2,071
< 3M 6,056 100_......_._.-._.-._.__.._._.__..__ _. _.___..._.._._ ......._ ... __,
< 6M 14,055 80
< 1 YR 14,256 :
< 2YR 20,276 2 60 41
< 3YR 31,063 te 40
< 4YR - a 20 9 10 14 21
< 5YR - 1 n n n n 0 0 0 I j
> 5YR _ 0
Total: $ 148,104 1M 2M 3M 6M 1YR 2YR 3YR 4YR 5YR 5YR
- 1
Ratings * Market Value (Credit Quality AAA
AAA $ 98,076 48%
AA 21,354 AA
A 6,982 Unrated ** 11%
Unrated * 76,603 38% A
Total: $ 203,015
3°!°
Sector Market Value `Asset AllocationM
MTNs
MMF $ 29,819 14% CAMP
Agencies 59,276 5%
MTNs 27,909 Agencies'
RDA Loan
CAMP 9,408 29% ^'+"" 11 %
RDA Loan 22,655 MMF Energy Loan
Energy Loan 4,349 15% LAIF 2%
LAIF 49,599 24%
Total: $ 203,015
Month Citv Yield LAIF Yield Variance PerformanceN
Jun09 2.03 1.38 0.65
Jul 1.90 1.04 0.86 2.4 - --------- ---
Aug 1.79 0.93 0.87
Sep 1.74 0.76 0.98
Oct 1.69 0.65 1.05
Nov 1.93 0.61 1.32 } 0.8
Dec 1.82 0.57 1.26
Jan10 1.31 0.56 0.76 0.0 -
Feb 1.41 0.58 0.83 JunOWul AugSep0ctNovDedan1FebMarAprMay
Mar 1.43 0.55 0.88
Apr 1,41 0.59 0.83 ® o
May 1.25 0.56 0.69
Standard and Poors
** LAIF, and City Loan to RDA Page 2
City of Palm Desert
Portfolio Holdings
May 31, 2010
Market
Ratings
Par Value
Issuer
lCouponj
Maturity I
Cost
J YTM
Price I
Value I
Moody's
S&P
Medium -Term Notes
$
3,795,000
BANK OF AMERICA
5.38
8/15/11
$ 3,851,020
4.05
104.09
$ 3,950,269
A2
A
$
3,000,000
BANK OF AMERICA
4.25
1011/10
$ 3,009,992
3.20
101.05
$ 3,031,572
A2
A
$
2,035,000
GENERAL ELECTRIC
4.88
10/21/10
$ 2,029,740
5.63
101.39
$ 2,063,201
Aa2
AA+
$
1,891,000
GENERAL ELECTRIC
6.88
11/15/10
$ 1,900,222
5.65
102.49
$ 1,938,078
Aa2
AA+
$
2,000,000
GENERAL ELECTRIC
6.13
2/22111
$ 2,005,773
5.67
103.61
$ 2,072,100
Aa2
AA+
$
3,965,000
GENERAL ELECTRIC
4.88
10/21/10
$ 3,989,103
3.23
101.39
$ 4,019,947
Aa2
AA+
$
3,000,000
TOYOTA
4.35
12/15/10
$ 3,063,006
0.44
101.70
$ 3,050,913
Aal
AA
$
2,000,000
WACHOVIA
7.80
8/18/10
$ 2,010,915
5.02
101.33
$ 2,026,516
Al
AA
$
4,000,000
WELLS FARGO BANK
6.38
8/1/11
$ 4,051,308
5.13
104.25
$ 4,169,956
Al
AA
$
2,000,000
WELLS FARGO BANK
4.63
8/9/10
$ 1,998,408
5.09
100.67
$ 2,013,386
Al
AA
$
27,686,000
Subtotal
$ 27,909,490
4.09
$ 28,335,938
Agencies -- Coupon
$
3,000,000
FED FARM CREDIT BANK
3.50
10/3/11
$
3,100,503
0.97
103.66
$
3,109,688
Aaa
AAA
$
3,000,000
FED HOME LOAN BANK
1.63
7/27/11
$
3,027,323
1.18
101.09
$
3,032,813
Aaa
AAA
$
3,000,000
FED HOME LOAN BANK
0.44
10/7/10
$
3,001,251
0.32
100.06
$
3,001,875
Aaa
AAA
$
3,000,000
FED HOME LOAN BANK
1.63
3/16/11
$
3,026,829
0.41
100.91
$
3,027,188
Aaa
AAA
$
2,062,000
FED HOME LOAN MTG CORP
4.13
7/12/10
$
2,071,965
5.47
100.44
$
2,071,021
Aaa
AAA
$
3,000,000
FED HOME LOAN MTG CORP
1.63
4/26/11
$
3,026,517
0.60
100.97
$
3,029,063
Aaa
AAA
$
3,000,000
FED HOME LOAN MTG CORP
4.13
2/24/11
$
3,078,706
0.52
102.56
$
3,076,875
Aaa
AAA
$
2,000,000
FED NAT MTG ASSOC
4.25
8/15/10
$
1,995,345
5.47
100.81
$
2,016,250
Aaa
AAA
$
3,000,000
FED NAT MTG ASSOC
1.75
12/28/12
$
2,996,079
1.91
100.50
$
3,015,000
Aaa
AAA
$
25,062,000
Subtotal
$
25,324,518
1.59
$
25,379,771
Agencies -- Callable
$
3,000,000
FED HOME LOAN BANK
1.00
10/28/11
$
3,000,000
1.00
100.19
$
3,005,625
Aaa
AAA
$
3,000,000
FED HOME LOAN BANK
1.38
6111/12
$
998,316
1.46
100.00
$
1,000,000
Aaa
AAA
$
15,000,000
FED HOME LOAN BANK
1.38
6/28/12
$
14,974,649
1.82
100.06
$
15,009,375
Aaa
AAA
$
2,980,000
FED HOME LOAN BANK
1.88
11/19/12
$
2,985,647
1.61
100.59
$
2,997,694
Aaa
AAA
$
3,000,000
FED HOME LOAN BANK
1.85
12/21/12
$
3,000,815
1.82
100.38
$
3,011,250
Aaa
AAA
$
3,000,000
FED HOME LOAN MTG CORP
1.25
1/26/12
$
3,000,000
1.25
100.25
$
3,007,443
Aaa
AAA
$
6,000,000
FED NATIONAL MTG ASSOC
1.75
12/28/12
$
5,992,480
1.90
100.50
$
6,030,000
Aaa
AAA
j $
35,980,000
Subtotal
$
33,951,908
1.68
$
34,061,387
Local Agency Investment Fund
$
49,598,636
L.A.I.F.
0.00
6/1/10
$
49,598,636
0.56
100.00
$
49,598,636
U
U
$
49,598,636
Subtotal
$
49,598,636
0.56
$
49,598,636
"U" = Unrated Page 3
City of Palm Desert
Portfolio Holdings
May 31, 2010
Market
Ratings
Par Value I Issuer
lCouponj
Maturity I
Cost
I YTM I
Price I
Value
Moody's
S&P
Local Agency Investment Fund
$ 8,800,216 C.A.M.P.
0.00
6/1/10
$ 8,800,216
0.20
100.00
$
8,800,216
U
AAA
$ 607,392 C.A.M.P. (DESERT WILLOW)
0.00
611110
$ 607,392
0.20
100.00
$
607,392
U
AAA
$ 9,407,609 Subtotal
$ 9,407,609
0.20
$
9,407,609
Money Market Fund
$ 29,818,942 WF ADVANTAGE GOVT MMF
0.00
6/1/10
$ 29,818,942
0.00
100.00
$
29,818,942
Aaa
AAA
$ 29,818,942 Subtotal
$ 29,818,942
0.00
$
29,818,942
City Loan to RDA
$ 22,655,000 CITY OF PALM DESERT
0.00
6/1/40
$ 22,655,000
0.56
100.00
$
22,655,000
U
U
$ 22,655,000 Subtotal
$ 22,655,000
0.56
$
22,655,000
City Loan to Energy Program
$ 4,349,000 CITY OF PALM DESERT
0.00
6/30135
$ 4,349,000
4.00
100.00
$
4,349,000
U
U
$ 4,349,000 Subtotal
$ 4,349,000
4.00
$
4,349,000
Total Investments
$ 204,557,187
$ 203,015,102
1.25
$
203,606,283
Cash
$ 1,928,198 CITY MAIN CHKG
0.00
6/1/10
$ 1,928,198
0.00
100.00
$
1,928,198
U
U
$ 962,243 DESERT WILLOW CHKG
0.00
6/1/10
$ 962,243
0.00
100.00
$
962,243
U
U
$ 226,759 RECREATIONAL FAC CHKG
0.00
6/1/10
$ 226,759
0.00
100.00
$
226,759
U
U
$ 3,117,201 Subtotal
$ 3,117,201
$
3,117,201
Total Investments and Cash
$ 207,674,388
$ 206,132,303
$
206,723,484
"U" = Unrated Page 4
City of Palm Desert
Portfolio Holdings
May 31, 2010
I Par Value I Issuer lCouponj Maturity I Cost
% of Portfolio
Corporate Issuers (Market Value)
BANK OF AMERICA
3.38%
GENERAL ELECTRIC
4.88%
TOYOTA
1.48%
WACHOVIA
0.98%
WELLS FARGO BANK
2.99%
% of Portfolio
Agency Issuers (Market Value)
FED FARM CREDIT BANK
1.50%
FED HOME LOAN BANK
16.49%
FED HOME LOAN MTG CORP
5.41 %
FED NAT MTG ASSOC
5.35%
Market Ratings
YTM I Price I Value Moody's I S&P
"U" = Unrated Page 5
Palm Desert Redevelopment Agency -- Portfolio Characteristics
May 31, 2010
Dollars in Thousands
Aaeina Interval Market Value
• 1 M $ 94,837 �portfolio Ageing w/o SLGSs
• 2M 3,007
• 3M - 100
• 6M 10,817 80 -
16,116 • 1YR 63
60 - -
• 2YR 18,264
0
• 3YR 3,789 40 -
0
• 4YR 20 - 7 11 12
2 0 3 0 0 2
• 5YR r, n n
0 --- - - -
• 5YR 3,151 < < < < < < < < < >
Total: $ 149,981 1M 2M 3M 6M 1YR 2YR 3YR 4YR 5YR 5YR
Qualit Market Value credit Quality
AA
AAA $ 152,630 AAA 2%
AA 6,075 51%
3
A 10,004
Unrated 130,560 �?Unrated
Total: $ 299,269 44%
Sector Market Value (Asset Allocation MTNs
MMF $ 66,380 Agencies 5% CAMP
Agencies 35,914 12% 16%
MTNs 16,079
47,185 CAMP MMF LAIF
LAIF 49,787 22% 17%
EIP 3,151 EIP
LAIF/Bond Proceeds 80,773 LAIF/Bond 1%
Total: $ 299,269 Proceeds
27%
Month RDA Yield LAW Yield variance lPerformance
Jun09 1.30 1.38 -0.08
Jul 1.31 1.04 0.27 1.5
Aug 1.19 0.93 0.26
Sep 0.95 0.76 0.19 1.0-
Oct 0.96 0.65 0.32 -F
Nov 1.21 0.61 0.59
-
Dec 1.21 0.57 0.64 0.5
Jan10 0.72 0.56 0.16
Feb 0.69 0.58 0.12 0.0
Mar 0.70 0.55 0.15 Jun09Ju1 Aug Sep Oct Nov Dedaril (Feb Mar Apr May
Apr 0.74 0.59 0.15 ®LAIF Yield 0 RDA Yield
May 0.69 0.56 0.13
Standard and Poors
LAIF Page 6
Palm Desert Redevelopment Agency
Portfolio Holdings
May 31, 2010
Market
Ratings
Par Value
Issuer
Coupon
Maturity
Cost
YTM
Price
Value
Moody's SAP
Medium -Term Notes
$
3,000,000
ABBOTT LABS
3.75
3115/11
$ 3,074,165
0.60
102.28
$ 3,068,484
Al
AA
$
3,450,000
BEAR STEARNS (JPM)
6.95
8110/12
$ 3,826,476
1.83
109.82
$ 3,788,959
Aa3
A+
$
3,000,000
JP MORGAN CHASE
3.13
1211/11
$ 3,099,501
0.69
104.15
$ 3,099,501
Aa3
A+
$
3,000,000
JP MORGAN CHASE
5.60
6/1111
$ 3,141,336
0.85
103.85
$ 3,115,548
Aa3
A+
$
3,000,000
WAL-MART
4.13
7/1/10
$ 3,002,913
2.91
100.22
$ 3,006,549
Aa2
AA
1 $
15,450,000
Subtotal
$ 16,144,391
1.39
$ 16,079,041
Agencies -- Coupon
$
4,900,000
FED FARM CREDIT BANK
4.90
9/22/10
$ 4,903,617
4.65
101.44
$ 4,970,438
Aaa
AAA
$
2,000,000
FED HOME LOAN BANK
4.88
3111/11
$ 1,991,021
5.49
103.38
$ 2,067,500
Aaa
AAA
$
2,000,000
FED HOME LOAN BANK
4.88
3/11/11
$ 1,990,902
5.50
103.38
$ 2,067,500
Aaa
AAA
$
2,890,000
FED HOME LOAN BANK
2.88
3/11111
$ 2,943,295
0.49
101.78
$ 2,941,478
Aaa
AAA
$
3,000,000
FED HOME LOAN BANK
0.50
11/29/10
$ 3,003,092
0.36
100.09
$ 3,002,813
Aaa
AAA
$
3,000,000
FED HOME LOAN BANK
1.13
1219/11
$ 3,008,795
0.96
100.50
$ 3,015,000
Aaa
AAA
$
2,000,000
FED HOME LOAN MTG CORP
6.88
9115/10
$ 2,006,790
5.54
101.97
$ 2,039,375
Aaa
AAA
$
3,734,000
FED HOME LOAN MTG CORP
6.88
9/15/10
$ 3,746,701
5.54
101.97
$ 3,807,513
Aaa
AAA
$
2,940,000
FED NAT MTG ASSOC
1,75
3/23/11
$ 2,969,827
0.43
100.97
$ 2,968,481
Aaa
AAA
$
9,000,000
FED NAT MTG ASSOC
1,00
11/23/11
$ 9,007,876
1.00
100.38
$ 9,033,750
Aaa
AAA
J $
35,464,000
Subtotal
$ 35,571,917
2.59
$ 35,913,848
Local Government Investment Pool
$
49,764,629
L.A.I.F.
0.00
6/1110
$
49,764,629
0.56
100.00
$
49,764,629
U
U
$
22,090
L.A.I.F, (HOUSING)
0.00
6/1/10
$
22,090
0.56
100.00
$
22,090
U
U
$
49,786,719
Subtotal
$
49,786,719
0.56
$
49,786,719
Local Government Investment Pool
$
17,469,371
L.A.I.F. / WELLS FARGO
0.00
6/1/10
$
17,469,371
0.56
100.00
$
17,469,371
U
AA
$
4,804,427
L.A.I.F. / WELLS FARGO
0.00
6/1/10
$
4,804,427
0.56
100.00
$
4,804,427
U
AA
$
25,153,920
L.A.I.F. / WELLS FARGO
0.00
6/1/10
$
25,153,920
0.56
100.00
$
25,153,920
U
AA
$
1,700,760
L.A.I.F. / WELLS FARGO
0.00
6/1/10
$
1,700,760
0.56
100.00
$
1,700,760
U
AA
$
15,133,500
L.A.I.F. / WELLS FARGO
0.00
6/1/10
$
15,133,500
0.56
100.00
$
15,133,500
U
AA
$
16,511,283
L.A.I.F. / WELLS FARGO
0.00
6/1/10
$
16,511,283
0.56
100.00
$
16,511,283
U
AA
$
80,773,262
Subtotal
$
80,773,262
0.56
$
80,773,262
Local Government Investment Pool
$
45,072,709
C.A.M.P.
0.00
6/1/10
$
45,072,709
0.20
100.00
$
45,072,709
U
AAA
$
2,112,408
C.A.M.P. (HOUSING)
0.00
611/10
$
2,112,408
0.20
100.00
$
2,112,408
U
AAA
$
47,185,117
Subtotal
$
47,185,117
0.20
$
47,185,117
"U" = Unrated Page 7
Palm Desert Redevelopment Agency
Portfolio Holdings
May 31, 2010
I
Market
Ratings
Par Value Issuer
Coupon Maturity
Cost
YTM
Price
Value
Moody's S&P
Money Market Fund
$ 66,379,641 WF ADVANTAGE GOVT MMF
0.00
6/1/10
$ 66,379,641
0.00
100.00
$ 66,379,641
Aaa AAA
} $ 66,379,641 Subtotal
$ 66,379,641
0.00
$ 66,379,641
Municipal Bonds
$ 3,151,000 CITY OF PALM DESERT
3.00
9/2/29
$ 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
$ 298,189,739
$ 298,992,046
0.69
$ 299,268,627
Cash
$ 323,777 HOUSING AUTH CHKG
0.00
6/1/10
$ 323,777
0.00
100.00
$ 323,777
U U
$ 405,238 HOUSING AUTH TRUST
0.00
6/1/10
$ 405,238
0.00
100.00
$ 405,238
U U
$ 729,015 Subtotal
$ 729,015
$ 729,015
Total Investments and Cash
$ 298,918,754
$ 299,721,061
$ 299,997,642
% of Portfolio
Corporate Issuers
(Market Value)
ABBOTT LABS
1.02%
BEAR STEARNS (JPM)
1.26%
JP MORGAN CHASE
2.07%
WAL-MART
1.00%
"U" = Unrated Page 8
Par Value
Palm Desert Redevelopment Agency
Portfolio Holdings
May 31, 2010
Issuer
Agency Issuers
Coupon I Maturity
FED FARM CREDIT BANK
FED HOME LOAN BANK
FED HOME LOAN MTG CORP
FED NAT MTG ASSOC
Cost
% of Portfolio
(Market Value)
1.66%
4.36%
1.95%
2.26%
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 May 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 June 22, 2010,
;Ps tj�l�ao�t, C. C. M 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
Portfolio Portfolio
0.0% 1 1.1%
Code
Investment Category
Maturity
Limit
S&P/Mdys
Maturity
Limit
S&P/Mdys
53601(a)
Palm Desert Bonds
5 Years
No Limit
53632(c)
Savings Accounts
No Limit
No Limit
No Limit
I
No Limit
53601(b)
U.S. Treasuries
5 Years
No Limit
5 Years
No Limit
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%
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
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
53601(j)
Medium -Term Notes
5 Years
0
30%
A
5 Years
0
30%
A
53601(k)
Mutual Funds
90 Days
20%
AAA & Aaa
90 Days
20% (2)
AAA & Aaa
53601(I)
Trust Indenture Debt I
I
Not Authorized
53601(m)
Secured Bank Deposits
5 Years
No Limit I
Not Authorized
53601(k)
Local Government I
I
AAA & Aaa
I
l AAA & Aaa
Investment Pools
90 Days
20%
or Advisor
_ 90 Days
20% (2)
I or Advisor I
53601(n)
Mortgage -Backed
5 Years
20%
A (Issuer) &
Not Authorized
Securities I IAA (Security)
16429.1(b) LAIF I No Limit I No Limit
(1) The City loan to RDA, which is not a bond, has been approved by the Palm Desert City Council.
(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.
0.0%
0.0%
29.2%
11.9%
0.0%
0.0%
13.8%
5.4%
14.7%
22.2%
4.6% I
15.8%
24.4%
43.7%
86.7%
100.0%
Certified California Municipal Treasurer Page 10
City of Palm Desert �.
City and Redevelopment Agency Portfolios
COMPLIANCE ANALYSIS AND INVESTMENT REPORT
June 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 August 10. At its June 24 meeting, the FOMC noted that
while an economic recovery was proceeding, consumer spending remained constrained by high unemployment, lower
housing wealth, and tight credit. With inflation likely to remain subdued for some time, the FOMC stated that short-term
interest rates would probably stay at current levels for an extended period.
U.S. economic growth is expected to slow during the second half of 2010, in the absence of further Federal stimulus. A
double -dip recession is not thought likely, however, unless there are substantial tax increases.
Small businesses remain starved for capital. U.S. banks are constrained in their ability to lend to small businesses due to
an estimated $176 billion of sour real estate loans. About two-thirds of bank commercial real estate loans that will mature
between 2010 -- 2014 are "underwater" (property worth less than loan). Banks continue to "extend and pretend" on
delinquent loans (as opposed to foreclosing) in order to avoid a hit to their earnings. This limits their lending capital.
It is impossible to anticipate when short-term interest rates will rise. The City Treasurer's Office is therefore pursuing a
strategy of buying securities in the middle of the maturity range, with an emphasis on U.S. Agency callables and selected
high-grade corporate bonds, that offer a higher incremental yield.
Pis �dwm c.c.M r.
City Treasurer
PORTFOLIO STATISTICS
Dollars in Thousands
JUN-10
MAY-10
APR-10
MAR-10
FEB-10
JAN-10
CITY
Month -End Book Value"
$
201,932
$
201,783
$
198,943
$
197,952
$
200,124
$
218,094
Month -End Market Value***
$
202,476
$
202,374
$
199,620
$
198,665
$
201,136
$
219,068
Paper Gain (Loss)
$
544
$
591
$
677
$
713
$
1,012
$
974
Prior Year Book Variance
$
(27,016)
$
(22,506)
$
(19,020)
$
(18,722)
$
(19,345)
$
5,356
Interest Earnings
227
207
233
227
$
227
$
221
Yield -To -Maturity
1.16%
1.28%
1.45%
1.43%
1.41 %
1.31 %
Weighted Maturity (Days)
363
415
461
465
455
419
Effective Duration
0.23
0.23
0.28
0.35
0.35
0.35
RDA
Month -End Book Value ***
$
302,563
$
299,721
$
285,335
$
295,407
$
304,221
$
287,243
Month -End Market Value ***
$
303,003
$
299,998
$
285,685
$
295,786
$
304,733
$
287,788
Paper Gain (Loss)
$
440
$
277
$
350
$
379
$
512
$
545
Prior Year Book Variance
$
15,272
$
6,001
$
32,808
$
27,030
$
33,805
$
5,970
interest Earnings
200
171
175
174
$
168
$
183
Yield -To -Maturity
0.78%
0.69%
0.74%
0.70%
0.69%
0,72%
Weighted Maturity (Days)
344
226
237
229
223
236
Effective Duration
0.51
0.31
0.34
0.35
0.34
0.38
*** Omits SLGSs.
Dollars in Thousands
Aaeina Interval
< I
< 2M
< 3M
< 6M
< 1 YR
< 2YR
< 3YR
< 4YR
< 5YR
> 5YR
Total:
Ratings
AAA
AA
A
Unrated *'
Total:
Sector
MMF
Agencies
MTNs
CAMP
RDA Loan
LAIF
Total:
Month
JU109
Aug
Sep
Oct
Nov
Dec
Jan10
Feb
Mar
Apr
May
Jun
Citv Yield
1.90
1.79
1.74
1.69
1.93
1.82
1.31
1.41
1.43
1.41
1.25
1.16
City of Palm Desert -- Portfolio Characteristics
June 30, 2010
Market Value
$ 75,993
6,056
17,106
11,205
20,276
18,054
$ 148,690
Market Value
$ 42,407
83,568
6,963
62,254
$ 195,192
Market Value
$ 29,811
46,440
28,278
28,409
22,655
39,599
$ 195,192
LAIF Yield
1.04
0.93
0.76
0.65
0.61
0.57
0.56
0.58
0.55
0.59
0.56
0.53
Variance
0.86
0.87
0.98
1.05
1.32
1.26
0.76
0.83
0.88
0.83
0.69
0.63
General Fund AgeingM
100 ....................... _,.._ ,..... _..._._- _...._......_._.. _ .- ._.
80 -
c 60 - 51
40 -
°' 20 4 12 8 14 12
o. 0 W.W.II n 0 0 0
1M 2M 3M 6M 1YR 2YR 3YR 4YR 5YR 5YR
i
Credit Quality
i
Asset Allocation
i
Performance
AAA
22%
AA
42%
Unrated *'
32%
A
4%
MTNs
14%
CAMP
Agencies .. - 15%
24% ';'v
RDA Loan
MMF 12%
15% LAIF
20%
2.1 - . _.. ... _._. _...... _ _._...__ ...
1.4- r
V
m
j 0.7 -
0.0
Ju109%ugSep Oct NovDedan1 Web MarAprMayJun
® c
Standard and Poors
** LAIF, and City Loan to RDA Page 2
f 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
June 30, 2010
Market Ratings
Issuer Coupon I Maturity Cost YTM I Price I Value Moody's I S&P
BANK OF AMERICA
5.38
8/15111
$
3,847,148
4.05
103.90
$
3,943,047
A2
A
BANK OF AMERICA
4.25
10/1/10
$
3,007,494
3.20
100.66
$
3,019,692
A2
A
GENERAL ELECTRIC
4.88
10/21/10
$
2,030,868
5.63
101.17
$
2,058,797
Aa2
AA+
GENERAL ELECTRIC
6.88
11/15/10
$
1,898,535
5.65
102.01
$
1,929,090
Aa2
AA+
GENERAL ELECTRIC
6.13
2/22/11
$
2,005,110
5.67
103.21
$
2,064,278
Aa2
AA+
GENERAL ELECTRIC
4.88
10/21/10
$
3,983,938
3.23
101.17
$
4,011,367
Aa2
AA+
TOYOTA
4.35
12/15/10
$
3,053,263
0.44
101.42
$
3,042,528
Aal
AA
WACHOVIA
7.80
8118/10
$
2,006,662
5.02
100.79
$
2,015,862
Al
AA
WELLS FARGO BANK
6.38
8/1/11
$
4,047,644
5.13
104.62
$
4,184,896
Al
AA
WELLS FARGO BANK
4.63
8/9/10
$
1,999,111
5.09
100.40
$
2,008,022
Al
AA
Subtotal
$
27,879,772
4.09
$
28,277,579
$
3,000,000
FED FARM CREDIT BANK
3.50
10/3/11
$
3,094,247
0.97
103.69
$
3,110,625
Aaa
AAA
$
3,000,000
FED HOME LOAN BANK
1.63
7/27/11
$
3,025,352
1.18
101.19
$
3,035,625
Aaa
AAA
$
3,000,000
FED HOME LOAN BANK
0.44
10/7/10
$
3,000,953
0.32
100.06
$
3,001,875
Aaa
AAA
$
3,000,000
FED HOME LOAN BANK
1.63
3/16/11
$
3,024,005
0.41
100.91
$
3,027,188
Aaa
AAA
$
3,000,000
FED HOME LOAN BANK
1A0
8/28/12
$
2,999,362
1.11
100.56
$
3,016,875
Aaa
AAA
$
2,062,000
FED HOME LOAN MTG CORP
4.13
7/12/10
$
2,074,116
5.47
100.13
$
2,064,578
Aaa
AAA
$
3,000,000
FED HOME LOAN MTG CORP
1.63
4126/11
$
3,024,070
0.60
101.00
$
3,030,000
Aaa
AAA
$
3,000,000
FED HOME LOAN MTG CORP
4.13
2/24/11
$
3,069,728
0.52
102.34
$
3,070,313
Aaa
AAA
$
2,000,000
FED NAT MTG ASSOC
4.25
8/15/10
$
1,997,232
5.47
100.50
$
2,010,000
Aaa
AAA
$
3,000,000
FED NAT MTG ASSOC
1.75
12/28/12
$
2,996,206
1.91
100.53
$
3,015,938
Aaa
AAA
$
28,062,000
Subtotal
$
28,305,272
1.54
$
28,383,015
Agencies -- Callable
$
3,000,000
FED HOME LOAN BANK
1.00
10/28/11
$
3,000,000
1.00
100.19
$
3,005,625
Aaa
AAA
$
2,980,000
FED HOME LOAN BANK
1.88
11/19/12
$
2,985,457
1.61
100.53
$
2,995,831
Aaa
AAA
$
3,000,000
FED HOME LOAN BANK
1.85
12/21/12
$
3,000,789
1.82
100.47
$
3,014,063
Aaa
AAA
$
3,000,000
FED HOME LOAN MTG CORP
1.25
1/26/12
$
3,000,000
1.25
100.38
$
3,011,409
Aaa
AAA
$
6,000,000
FED NAT MTG ASSOC
1.75
12/28/12
$
5,992,723
1.90
100.53
$
6,031,875
Aaa
AAA
$
17,980,000
Subtotal
$
17,978,968
1.58
$
18,058,803
Local Agency Investment Fund
$
39,598,636
L.A.I.F.
0.00
7/1/10
$
39,598,636
0.53
100.00
$
39,598,636
U
U
$
39,598,636
Subtotal
$
39,598,636
0.53
$
39,598,636
Local Agency Investment Fund
$
27,801,257
C.A.M.P.
0.00
7/1/10
$
27,801,257
0.25
100.00
$
27,801,257
U
AAA
$
607,515
C.A.M.P. (DESERT WILLOW)
0.00
7/1/10
$
607,515
0.25
100.00
$
607,515
U
AAA
$
28,408,771
Subtotal
$
28,408,771
0.25
$
28,408,771
"U" = Unrated Page 3
City of Palm Desert
Portfolio Holdings
June 30, 2010
Market
Par Value Issuer Coupon Maturity Cost YTM Price I Value
Money Market Fund
$ 29,810,641 WF ADVANTAGE GOVT MMF
0.00
$ 29,810,641 Subtotal
City Loan to RDA
$ 22,655,000 CITY OF PALM DESERT
0.00
$ 22,655,000 Subtotal
Total Investments
$ 194,201,048
Cash
$ 6,523,590 CITY MAIN CHKG
0.00
$ 575,550 DESERT WILLOW CHKG
0.00
$ 183,656 RECREATIONAL FAC CHKG
0.00
$ 7,282,796 Subtotal
Total Investments and Cash
$ 201,483,844
Corporate Issuers
BANK OF AMERICA
GENERAL ELECTRIC
TOYOTA
WACHOVIA
WELLS FARGO BANK
7/1110 $ 29,810,641 0.00 100.00 $ 29,810,641
$ 29,810,641 0.00 $ 29,810,641
711140 $ 22,655,000 0.53 100.00 $ 22,655,000
$ 22,655,000 0.53 $ 22,655,000
$ 194,637,060 1.22 $ 195,192,445
7/1/10 $
6,523,590
0.00
100.00 $
6,523,590
711/10 $
575,550
0.00
100.00 $
575,550
7/1/10 $
183,656
0.00
100.00 $
183,656
$
7,282,796
0.00
$
7,282,796
$ 201,919,856
% of Portfolio
(Market Value)
3.44%
4.97%
1.50%
1.00%
3.06%
$ 202,475,241
Ratings
Moody's I S&P
Aaa AAA
U U
U
U
U
U
U
U
"U" = Unrated Page 4
} Par Value
Issuer
Agency Issuers
City of Palm Desert
Portfolio Holdings
June 30, 2010
Coupon I Maturity
FED FARM CREDIT BANK
FED HOME LOAN BANK
FED HOME LOAN MTG CORP
FED NAT MTG ASSOC
Cost
% of Portfolio
(Market Value)
1.54%
10.42%
5.52%
5.46%
Market Ratings
j YTM I Price I Value Moody's I S&P
"U" = Unrated Page 5
Palm Desert Redevelopment Agency -- Portfolio Characteristics
June 30, 2010
Dollars in Thousands
Aaeina Interval Market Value J
< 1M $ 57,844Portfolio Ageing w/o SLGSs�
< 2M - 1
< 3M 10,817 100 ---
< 6M 3,003 80 -
< 1YR 16,229
< 2YR 17,646 2 60 -
0 38
< 3YR 44,286 40 - 29
o
< 4YR - a 20 - 7 11 12 n
< 5YR - O n 2 n n I I 0 0 2 i
0
> 5YR 3,151 < < < < < < < < < >
Total: $ 152,976 1 M 2M 3M 6M 1 YR 2YR 3YR 4YR 5YR 5YR
\. J
ualit Market Value Credit Quail y� AA 1
AAA $ 155,752 ' AAA (?011,AA 6,063 52%A
3%
A 10,003
Unrated *" 130,560
Un
Total: $ 302,378 43% "
43%
\ i
Sector Market Value Asset Allocation
MMF $ 66,381 Agencies CAMP
Agencies 79,033 26% 2%
MTNs 16,066 MTNs
MMF 5%
CAMP 7,187 22% LAIF
LAIF 49,787 16%
EIP 3,151
Proceeds EIP
LAIF/Bond Proceeds 80,773
Proceeds 1
Total: $ 302,378 28%
Month RDA Yield LAIF Yield Variance PerformanceN
JU109 1.31 1.04 0.27
Aug1.19 0.93 0.26 1.5 ___.--.--.------_--_.___.__._ ...... .._..----____._._..._-.-_s
Sep 0.95 0.76 0.19
Oct 0.96 0.65 0.32
1.0 -
Nov 1.21 0.61 0.59 a
Dec 1.21 0.57 0.64 d
Jan10 0.72 0.56 0.16 0.5
Feb 0.69 0.58 0.12
Mar 0.70 0.55 0.15 0.0 - r
Apr 0.74 0.59 0.15 ( Ju109kug Sep Oct Nov Dedan10=eb Mar Apr May Jun
May 0.69 0.56 0.13 F- -- --- - -
®LAIF Yield DRDA Yield
Jun 0.78 0.53 0.25 J
Standard and Poors
'* LAIF Page 6
Palm Desert Redevelopment Agency
Portfolio Holdings
June 30, 2010
Market
Ratings
Par Value
Issuer
Coupon
I Maturity
Cost
YTM I
Price
Value
Moody's I S&P
Medium -Term Notes
$
3,000,000
ABBOTT LABS
3.75
3115/11
$ 3,066,330
0.60
102.08
$ 3,062,508
Al AA
$
3,450,000
BEAR STEARNS CO.
6.95
8/10/12
$ 3,812,162
1.83
109.69
$ 3,784,195
Aa3 A+
$
3,000,000
JP MORGAN CHASE
3.13
1211/11
$ 3,093,973
0.69
104.15
$ 3,093,973
Aa3 A+
$
3,000,000
JP MORGAN CHASE
5.60
611111
$ 3,129,558
0.85
104.17
$ 3,124,995
Aa3 A+
$
3,000,000
WAL-MART
4.13
7/1/10
$ 3,000,000
2.91
100.00
$ 3,000,000
Aa2 AA
1 $
15,450,000
Subtotal
$ 16,102,023
1.39
$ 16,065,670
Agencies -- Coupons
$
4,900,000
FED FARM CREDIT BANK
4.90
9/22/10
$
4,902,640
4.65
101.06
$
4,952,063
Aaa
AAA
$
2,000,000
FED HOME LOAN BANK
4.88
3/11/11
$
1,991,983
5.49
103.09
$
2,061,875
Aaa
AAA
$
2,000,000
FED HOME LOAN BANK
4.88
3/11/11
$
1,991,876
5.50
103.09
$
2,061,875
Aaa
AAA
$
2,890,000
FED HOME LOAN BANK
2.88
3/11/11
$
2,937,585
0.49
101.69
$
2,938,769
Aaa
AAA
$
3,000,000
FED HOME LOAN BANK
0.50
11/29/10
$
3,002,571
0.36
100.13
$
3,003,750
Aaa
AAA
$
3,000,000
FED HOME LOAN BANK
1.13
12/9/11
$
3,008,314
0.96
100.78
$
3,023,438
Aaa
AAA
$
2,000,000
FED HOME LOAN BANK
1.10
8/28/12
$
1,999,575
1.11
100.56
$
2,011,250
Aaa
AAA
$
2,500,000
FED HOME LOAN BANK
1.10
8/28/12
$
2,499,468
1.11
100.56
$
2,514,063
Aaa
AAA
$
2,500,000
FED HOME LOAN BANK
1.10
8/28/12
$
2,499,476
1.11
100.56
$
2,514,063
Aaa
AAA
$
2,500,000
FED HOME LOAN BANK
1.38
10/29/12
$
2,510,003
1.20
101.16
$
2,528,906
Aaa
AAA
$
4,900,000
FED HOME LOAN BANK
1.75
12/14/12
$
4,947,689
1.40
101.94
$
4,994,938
Aaa
AAA
$
3,000,000
FED HOME LOAN BANK
1.10
8/28/12
$
2,999,372
1.11
100.56
$
3,016,875
Aaa
AAA
$
2,000,000
FED HOME LOAN MTG CORP
6.88
9/15/10
$
2,004,832
5.54
101.41
$
2,028,125
Aaa
AAA
$
3,734,000
FED HOME LOAN MTG CORP
6.88
9/15/10
$
3,743,037
5.54
101.41
$
3,786,509
Aaa
AAA
$
2,940,000
FED NAT MTG ASSOC
1.75
3123111
$
2,966,763
0.43
100.97
$
2,968,481
Aaa
AAA
$
9,000,000
FED NAT MTG ASSOC
1.00
11/23/11
$
9,007,431
1.00
100.63
$
9,056,250
Aaa
AAA
$
2,500,000
FED NAT MTG ASSOC
1.13
7/30/12
$
2,502,665
1.08
100.66
$
2,516,406
Aaa
AAA
$
55,364,000
Subtotal
$
55,515,280
2.09
$
55,977,634
Agencies -- Callable
$
2,500,000
FED FARM CREDIT BANK
1.90
11/16/12
$
2,512,117
0.78
100.44
$
2,510,938
Aaa
AAA
$
2,500,000
FED FARM CREDIT BANK
1.90
11/16/12
$
2,512,117
0.78
100.44
$
2,510,938
Aaa
AAA
$
7,000,000
FED HOME LOAN BANK
0.50
9/24/12
$
7,000,000
0.75
100.06
$
7,004,375
Aaa
AAA
$
2,500,000
FED HOME LOAN MTG CORP
1,20
6/15/12
$
2,502,933
1.08
100.48
$
2,512,068
Aaa
AAA
$
6,000,000
FED HOME LOAN MTG CORP
0.50
917/12
$
6,000,000
0.50
100.14
$
6,008,364
Aaa
AAA
$
2,500,000
FED NAT MTG ASSOC
1.88
10/29/12
$
2,514,290
0.41
100.38
$
2,509,375
Aaa
AAA
$
23,000,000
Subtotal
$
23,041,458
0.69
$
23,056,057
Local Government Investment Pool
$
49,764,629
L.A.I.F.
0.00
711110
$
49,764,629
0.53
100.00
$
49,764,629
U
U
$
22,090
L.A.I.F. (HOUSING)
0.00
7/1/10
$
22,090
0.53
100.00
$
22,090
U
U
$
49,786,719
Subtotal
$
49,786,719
0.53
$
49,786,719
"U" = Unrated Page 7
Palm Desert Redevelopment Agency
Portfolio Holdings
June 30, 2010
Par Value I Issuer j Coup
Local Government Investment Pool
$
17,469,371
L.A.I.F. / WELLS FARGO
0.00
$
4,804,427
L.A.I.F. / WELLS FARGO
0.00
$
25,153,920
L.A.I.F. / WELLS FARGO
0.00
$
1,700,760
L.A.I.F. / WELLS FARGO
0.00
$
15,133,500
L.A.I.F. / WELLS FARGO
0.00
$
16,511,283
L.A.I.F. / WELLS FARGO
0.00
$
80,773,262
Subtotal
Local Government
Investment Pool
$
5,074,195
C.A.M.P.
0.00
$
2,112,833
C.A.M.P. (HOUSING)
0.00
$
7,187,028
Subtotal
Money Market Fund
$
66,381,034 WF ADVANTAGE GOVT MMF
0.00
$
66,381,034
Subtotal
Municipal Bonds
$
3,151,000
CITY OF PALM DESERT
3.00
$
3,151,000
Subtotal
Total Investments
$
301,093,043
Cash
$
220,346
HOUSING AUTH CHKG
0.00
$
404,747
HOUSING AUTH TRUST
0.00
$
625,093
Subtotal
Total Investments and Cash
$ 301,718,136
Market
on I Maturity i Cost YTM I Price I Value
711/10
$
17,469,371
0.53
100.00
$
17,469,371
711/10
$
4,804,427
0.53
100.00
$
4,804,427
7/1/10
$
25,163,920
0.53
100.00
$
25,153,920
7/1/10
$
1,700,760
0.53
100.00
$
1,700,760
7/1/10
$
15,133,500
0.53
100.00
$
15,133,500
7/1/10
$
16,511,283
0.53
100.00
$
16,511,283
$
80,773,262
0.53
$
80,773,262
7/1/10
$
5,074,195
0.25
100.00
$
5,074,195
7/1/10
$
2,112,833
0.25
100.00
$
2,112,833
$
7,187,028
0.25
$
7,187,028
Ratings
Moody's I S&P
U AA
U AA
U AA
U AA
U AA
U AA
U
U
AAA
AAA
7/1/10 $
66,381,034
0.00
100.00 $
66,381,034 Aaa AAA
$
66,381,034
0.00
$
66,381,034
9/2/29 $
3,151,000
3.00
100.00 $
3,151,000 U AA
$
3,151,000
3.00
$
3,151,000
$ 301,937,804 0.78 $ 302,378,405
7/1/10 $
220,346
0.00 100.00 $
220,346 U U
7/1/10 $
404,747
0.00 100.00 $
404,747 U U
$
625,093
$
625,093
$ 302,562,896 $ 303,003,497
"U" = Unrated Page 8
Palm Desert Redevelopment Agency
Portfolio Holdings
June 30, 2010
Market Ratings
Par Value Issuer Coupon I Maturity Cost YTM I Price I Value Moody's I S&P
% of Portfolio
Corporate Issuers (Market Value)
ABBOTT LABS
1.01 %
BEAR STEARNS CO.
1.25%
JP MORGAN CHASE
2.05%
WAL-MART
0.99%
% of Portfolio
Agency Issuers
(Market Value)
FED FARM CREDIT BANK
3.29%
FED HOME LOAN BANK
12.43%
FED HOME LOAN MTG CORP
4.73%
FED NAT MTG ASSOC
5.04%
"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 June 30, 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 July 27, 2010,
Pis �jdVom, 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
0.0%
1
0.0%
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%
23.8%
26.0%
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
53601(j)
Medium -Term Notes
5 Years
30%
A
5 Years
30%
A
14.3%
5.3%
53601(k)
Mutual Funds
90 Days
20%
AAA & Aaa
90 Days
20% (2)
AAA & Aaa
15.3% 1
22.0%
53601(I)
Trust Indenture Debt
Not Authorized
53601(m)
Secured Bank Deposits
5 Years
No Limit
Not Authorized
53601(k)
Local Government
I
AAA & Aaa
( AAA & Aaa
Investment Pools
90 Day s f
20%
or Advisor
90 Days (
20% 2)
(
I or Advisor 1
14.6% I
2.4%
53601(n)
Mortgage -Backed
5 Years
20%
A (Issuer) &
Not Authorized
Securities
AA (Security)
16429.1(b)
LAW
No Limit
No Limit
j I
20.3% l
43.2%
(1) The City loan to RDA, which is not a bond, has
been approved by the Palm
Desert City Council. 1
88.4%
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
July 2010
Paul S. Gibson, C.C.M.T., Treasurer
Thomas W. Jeffrey, J.D., M.B.A., Deputy City Treasurer
Treasurer's Commentary
A sharply divided Federal Open Market Committee (FOMC) met on August 10, and reversed direction by initiating a new
round of "quantitative easing" to address a weakening U.S. economy. The Federal Reserve will use $250 billion in cash to
buy U.S. Treasuries in order to keep long-term interest rates low. The FOMC is concerned about a double -dip recession
developing due to persistently high unemployment, weak economic indicators, and massive debt deleveraging by
consumers and businesses. Inflation is currently running close to zero, and the trend in all of the major price indices is
decelerating.
With the end of the federal stimulus, sales of existing U.S. homes fell to a 15-year low in July. Initial unemployment claims
rose to 500,000 in August, and U.S. auto sales fell to a 27-year low during the same time period. At least 829 U.S. banks
(11%), mostly community banks, remain at risk of failure. Wells Fargo is forecasting U.S. economic growth averaging
between 1 % and 1.5% during the second half of 2010.
U.S. Treasury yields fell sharply as investors sought safety in low -risk securities due to rising anxiety over the global
economy. Federal Funds Futures are currently assigning a 53% probability to the FOMC's keeping the Federal Funds Rate
unchanged at 0.25% through August 2011. According to the Wall Street Journal, retail investors are starting to buy riskier
assets, such as junk bonds and leveraged mutual funds, and to engage in currency speculation, in order to boost yields.
Pis (i6bjo�, c.c.s r.
City Treasurer
PORTFOLIO STATISTICS
Dollars in Thousands
JUL-10
JUN-10
MAY-10
APR-10
MAR-10
FEBA0
CITY
Month -End Book Value''"
$
197,878
$ 201,932
$ 201,783
$
198,943
$
197,952
$
200,124
Month -End Market Value"""
$
198,453
$ 202,476
$ 202,374
$
199,620
$
198,665
$
201,136
Paper Gain (Loss)
$
575
$ 544
$ 591
$
677
$
713
$
1,012
Prior Year Book Variance
$
(28,582)
$ (27,016)
$ (22,506)
$
(19,020)
$
(18,722)
$
(19,345)
Interest Earnings
173
227
207
233
227
$
227
Yield -To -Maturity
1.12%
1.16%
1.28%
1.45%
1.43%
1.41 %
Weighted Maturity (Days)
351
363
415
461
465
455
Effective Duration
0.21
0.23
0.23
0.28
0.35
0.35
RDA
Month -End Book Value """
$
298,525
$
302,563
$
299,721
$ 285,335
$
295,407
$
304,221
Month -End Market Value''"
$
299,032
$
303,003
$
299,998
$ 285,685
$
295,786
$
304,733
Paper Gain (Loss)
$
507
$
440
$
277
$ 350
$
379
$
512
Prior Year Book Variance
$
14,305
$
15,272
$
6,001
$ 32,808
$
27,030
$
33,805
Interest Earnings
195
200
171
175
174
$
168
Yield -To -Maturity
0.76%
0.78%
0.69%
0.74%
0.70%
0.69%
Weighted Maturity (Days)
339
344
226
237
229
223
Effective Duration
0.49
0.51
0.31
0.34
0.35
0.34
""" Omits SLGSs.
City of Palm Desert -- Portfolio Characteristics
July 31, 2010
Dollars in Thousands
Aaeina Interval Market Value
< 1 M $ 78,450 General Fund Ageing
< 2M
< 3M 12,073 100---..__..__-__
< 6M 4,960 80
< 1YR 14,214
< 2YR 17,287 260 - 54
< 3YR 18,071 40 - 1
< 4YR -
< 5YR _ a 20 0 8 3 10 12 12 0 0 0 3
> 5YR _ 0 n rl n n
Total: $ 145,055 < < < < < < < < <
1M 2M 3M 6M 1YR 2YR 3YR 4YR 5YR 5YR
Ratings Market Value (Credit Quality
AAA $ 122,943 AAA
AA 21,290 Unrated "' 63%
A 6,972 22% iD
Unrated 41,924 A AA
Total: $ 193,129 4% 11 %
i 1
Sector Market Value (Asset Allocati� MTNs
MMF $ 29,783 15%
CAMP
Agencies 44,353 15/o
MTNs 28,262 Agencies Lr3y o
22%
CAMP 28,417 RDA Loan
RDA Loan 22,655 12%
MMF
LAIF 39,659 15% LAIF
Total: $ 193,129 21%
Month Citv Yield LAIF Yield Variance PerformanceM
Aug09 1.79 0.93 0.87
Sep 1.74 0.76 0.98 2.1
Oct 1.69 0.65 1.05
Nov 1.93 0.61 1.32
1.4 -
Dec 1.82 0.57 1.26
Jan10 1.31 0.56 0.76 2
Feb 1.41 0.58 0.83 >- 0.7
Mar 1.43 0.55 0.88
Apr 1.41 0.59 0.83 0.0
May 1.25 0.56 0.69 AugOSepOctNovDedan1EebMarAprMayJun Jul
Jun 1.16 0.53 0.63
Jul 1.12 0.53 0.59 C
Standard and Poors
"" LAIF, and City Loan to RDA Page 2
City of Palm Desert
Portfolio Holdings
July 31, 2010
Market
Ratings
Par Value
Issuer
l Couponj
Maturity I
Cost
I YTM 1
Price
Value
I Moody's
S&P
Medium -Term Notes
$
3,795,000
BANK OF AMERICA
5.38
8/15/11
$ 3,843,276
4.05
104.24
$
3,955,828
A2
A
$
3,000,000
BANK OF AMERICA
4.25
10/1/10
$ 3,004,996
3.20
100.55
$
3,016,581
A2
A
$
2,035,000
GENERAL ELECTRIC
4.88
10/21/10
$ 2,031,995
5.63
100.91
$
2,053,478
Aa2
AA+
$
1,891,000
GENERAL ELECTRIC
6.88
11/15/10
$ 1,896,848
5.65
101.70
$
1,923,181
Aa2
AA+
$
2,000,000
GENERAL ELECTRIC
6.13
2/22111
$ 2,004,446
5.67
102.95
$
2,058,928
Aa2
AA+
$
3,965,000
GENERAL ELECTRIC
4.88
10/21/10
$ 3,978,773
3.23
100.91
$
4,001,002
Aa2
AA+
$
3,000,000
TOYOTA
4.35
12/15/10
$ 3,043,520
0.44
101.22
$
3,036,735
Aal
AA
$
2,000,000
WACHOVIA
7.80
8/18/10
$ 2,002,410
5.02
100.30
$
2,005,946
Al
AA
$
4,000,000
WELLS FARGO BANK
6.38
8/1/11
$ 4,043,979
5.13
105.22
$
4,208,984
Al
AA
$
2,000,000
WELLS FARGO BANK
4.63
8/9/10
$ 1,999,813
5.09
100.07
$
2,001,348
Al
AA
$
27,686,000
Subtotal
$ 27,850,055
4.09
$
28,262,011
Agencies -- Coupon
$
3,000,000
FED FARM CREDIT BANK
3.50
10/3111
$
3,087,992
0.97
103.56
$
3,106,875
Aaa
AAA
$
3,000,000
FED HOME LOAN BANK
1.63
7/27/11
$
3,023,382
1.18
101.25
$
3,037,500
Aaa
AAA
$
3,000,000
FED HOME LOAN BANK
0.44
10/7/10
$
3,000,655
0.32
100.06
$
3,001,875
Aaa
AAA
$
3,000,000
FED HOME LOAN BANK
1.63
3116/11
$
3,021,180
0.41
100.84
$
3,025,313
Aaa
AAA
$
3,000,000
FED HOME LOAN BANK
1.10
8/28/12
$
2,999,387
1.11
100.78
$
3,023,438
Aaa
AAA
$
3,000,000
FED HOME LOAN MTG CORP
1.63
4/26/11
$
3,021,622
0.60
100.97
$
3,029,063
Aaa
AAA
$
3,000,000
FED HOME LOAN MTG CORP
4.13
2/24/11
$
3,060,750
0.52
102.09
$
3,062,813
Aaa
AAA
$
2,000,000
FED NAT MTG ASSOC
4.25
8/15/10
$
1,999,119
5.47
100.16
$
2,003,125
Aaa
AAA
$
3,000,000
FED NAT MTG ASSOC
1.75
12/28/12
$
2,996,333
1.91
100.47
$
3,014,063
Aaa
AAA
$
26,000,000
Subtotal
$
26,210,421
1.23
$
26,304,063
Agencies -- Callable
$
3,000,000
FED HOME LOAN BANK
1.00
10/28/11
$
3,000,000
1.00
100.16
$
3,004,688
Aaa
AAA
$
2,980,000
FED HOME LOAN BANK
1.88
11/19/12
$
2,985,266
1.61
100.44
$
2,993,038
Aaa
AAA
$
3,000,000
FED HOME LOAN BANK
1.85
12/21/12
$
3,000,762
1.82
100.41
$
3,012,188
Aaa
AAA
$
3,000,000
FED HOME LOAN MTG CORP
1.25
1/26/12
$
3,000,000
1.25
100.37
$
3,011,016
Aaa
AAA
$
6,000,000
FED NAT MTG ASSOC
1.75
12/28/12
$
5,992,966
1.90
100.47
$
6,028,124
Aaa
AAA
$
17,980,000
Subtotal
$
17,978,994
1.58
$
18,049,053
Local Agency Investment Fund
$
39,658,990
L.A.I.F. 0.00
8/1/10 $
39,658,990
0.53
100.00 $
39,658,990 U U
f $
39,658,990
Subtotal
$
39,658,990
0.53
$
39,658,990
Local Agency Investment Fund
$
27,809,335
C.A.M.P. 0.00
8/1/10 $
27,809,335
0.31
100.00 $
27,809,335 U AAA
$
607,673
C.A.M.P. (DESERT WILLOW) 0.00
811110 $
607,673
0.31
100.00 $
607,673 U AAA
$
28,417,008
Subtotal
$
28,417,008
0.31
$
28,417,008
"U" = Unrated Page 3
City of Palm Desert
Portfolio Holdings
July 31, 2010
I Par Value I Issuer I Coupon I Maturity
Money Market Fund
$ 29,782,603 WF ADVANTAGE GOVT MMF
0.00
$ 29,782,603 Subtotal
City Loan to RDA
$ 22,655,000 CITY OF PALM DESERT
0.00
$ 22,655,000 Subtotal
Total Investments
$ 192,179,601
Cash
$ 4,970,994 CITY MAIN CHKG
0.00
$ 274,017 DESERT WILLOW CHKG
0.00
$ 79,504 RECREATIONAL FAC CHKG
0.00
$ 5,324,516 Subtotal
Total Investments and Cash
$ 197,504,117
Corporate Issuers
BANK OF AMERICA
GENERAL ELECTRIC
TOYOTA
WACHOVIA
WELLS FARGO BANK
Market
Cost YTM I Price I Value
8/1/10 $ 29,782,603 0.00 100.00 $ 29,782,603
$ 29,782,603 0.00 $ 29,782,603
8/1/40 $ 22,655,000 0.53 100.00 $ 22,655,000
$ 22,655,000 0.53 $ 22,655,000
$ 192,553,071 1.12 $ 193,128,728
Ratings
Moody's I S&P
Aaa AAA
I
U U `
J
8/1/10 $
4,970,994
0.00 100.00 $
4,970,994 U U
8/1/10 $
274,017
0.00 100.00 $
274,017 U U
8/1/10 $
79,504
0.00 100.00 $
79,504 U U
$
5,324,516
$
5,324,516 J
$ 197,877,587
% of Portfolio
(Market Value)
3.51 %
5.06%
1.53%
1.01 %
3.13%
$ 198,453,243
"U" = Unrated Page 4
I Par Value
City of Palm Desert
Portfolio Holdings
July 31, 2010
Market
Issuer Coupon Maturity Cost YTM I Price I Value
% of Portfolio
Agency Issuers (Market Value)
FED FARM CREDIT BANK
FED HOME LOAN BANK
FED HOME LOAN MTG CORP
FED NAT MTG ASSOC
1.57%
10.63%
6.08%
5.57%
Ratings
Moody'sI S&P
"U" = Unrated Page 5
Palm Desert Redevelopment Agency -- Portfolio Characteristics
July 31, 2010
Dollars in Thousands
Aaeina Interval Market Value
< I $ 49,909 ; Portfolio Ageing w/o SLGSs�
< 2M 10,713
< 6M 3,003 80 - M
< 1 YR 16,196 0
< 2YR 20,237 2 60 i
o
< 3YR 41,958 o 40 - 34 29
< 4YR - a 20 - 7 11 14 IIII
< 5YR - n 0 2 I-1 n l l 0 0 i
> 5YR 3,151
o
< < < < < < < < <
Total: $ 145,167
1 M 2M 3M 6M 1 YR 2YR 3YR 4YR 5YR 5YR
ualit * Market Value Credit Quality AA
AAA $ 154,593 1 %
AA 3,059 AAA A
A 10,035 �
Unrated *" 130,730 52% 3%
Total: $ 298,417 Unrated "
\ 44%
Sector Market Value Asset Allocation Agencies
MMF $ 70,239 26% MTNs
Ir-
%
Agencies 79,014 CAMP
MTNs 13,094 MMF 1 %
CAMP 2,189 24% LAIF
LAIF 49,856 17%
EIP 3,151 IP
LAIF/Bond Proceeds 80,874 LAIF/Bond 1%
Total: $ 298,417 Proceeds
27%
Month RDA Yield LAIF Yield Variance jPerformanceN
Aug09 1.19 0.93 0.26
Sep 0.95 0.76 0.19 1.4
Oct 0.96 0.65 0.32 j
Nov 1.21 0.61 0.59
Dec 1.21 0.57 0.64 a
Jan10 0.72 0.56 0.16 2 0.7
Feb 0.69 0.58 0.12 }
Mar 0.70 0.55 0.15
Apr 0.74 0.59 0.15 0.0 a
May 0.69 0.56 0.13 AugOSep Oct Nov Dedanl0 eb Mar Apr May Jun Jul
Jun 0.78 0.53 0.25 ®LAIF Yield
Jul 0.76 0.53 0.23 ORDAYield
� J
" Standard and Poors
** LAIF Page 6
Palm Desert Redevelopment Agency
Portfolio Holdings
July 31, 2010
Market
Ratings
Par Value
Issuer Coupon
Maturity
Cost
YTM I
Price
Value
Moody's
S&P
Medium
-Term Notes
$
3,000,000
ABBOTT LABS
3.75
3/15111
$
3,058,496
0.60
101.98
$
3,059,313
Al
AA
$
3,450,000
BEAR STEARNS (JPM)
6.95
8/10/12
$
3,797,847
1.83
110.34
$
3,806,799
Aa3
A+
$
3,000,000
JP MORGAN CHASE
3.13
12/1/11
$
3,088,445
0.69
103.44
$
3,103,311
Aa3
A+
$
3,000,000
JP MORGAN CHASE
5.60
6/1/11
$
3,117,780
0.85
104.16
$
3,124,668
Aa3
A+
1 $
12,450,000
Subtotal
$
13,062,568
1.04
$
13,094,091
Agencies
-- Coupon
$
4,900,000
FED FARM CREDIT BANK
4.90
9/22/10
$
4,901,662
4.65
100.66
$
4,932,156
Aaa
AAA
$
2,000,000
FED HOME LOAN BANK
4.88
3/11/11
$
1,992,945
5.49
102.78
$
2,055,625
Aaa
AAA
$
2,000,000
FED HOME LOAN BANK
4.88
3/11/11
$
1,992,851
5.50
102.78
$
2,055,625
Aaa
AAA
$
2,890,000
FED HOME LOAN BANK
2.88
3/11/11
$
2,931,875
0.49
101.53
$
2,934,253
Aaa
AAA
$
3,000,000
FED HOME LOAN BANK
0.50
11/29/10
$
3,002,050
0.36
100.09
$
3,002,813
Aaa
AAA
$
3,000,000
FED HOME LOAN BANK
1.13
1219111
$
3,007,832
0.96
100.91
$
3,027,188
Aaa
AAA
$
2,000,000
FED HOME LOAN BANK
1.10
8128/12
$
1,999,591
1.11
100.78
$
2,015,625
Aaa
AAA
$
2,500,000
FED HOME LOAN BANK
1.10
8/28/12
$
2,499,489
1.11
100.78
$
2,519,531
Aaa
AAA
$
2,500,000
FED HOME LOAN BANK
1.10
8/28/12
$
2,499,497
1.11
100.78
$
2,519,531
Aaa
AAA
$
2,500,000
FED HOME LOAN BANK
1.38
10/29/12
$
2,509,645
1.20
101.38
$
2,534,375
Aaa
AAA
$
4,900,000
FED HOME LOAN BANK
1.75
12/14/12
$
4,946,069
1.40
102.16
$
5,005,656
Aaa
AAA
$
3,000,000
FED HOME LOAN BANK
1.10
8/28/12
$
2,999,396
1.11
100.78
$
3,023,438
Aaa
AAA
$
2,000,000
FED HOME LOAN MTG CORP
6.88
9115/10
$
2,002,873
5.54
100.81
$
2,016,250
Aaa
AAA
$
3,734,000
FED HOME LOAN MTG CORP
6.88
9/15/10
$
3,739,373
5.54
100.81
$
3,764,339
Aaa
AAA
$
2,940,000
FED NATIONAL MTG ASSOC
1.75
3/23/11
$
2,963,698
0.43
100.91
$
2,966,644
Aaa
AAA
$
9,000,000
FED NATIONAL MTG ASSOC
1.00
11/23111
$
9,006,987
1.00
100.78
$
9,070,313
Aaa
AAA
$
2,500,000
FED NATIONAL MTG ASSOC
1.13
7/30/12
$
2,502,558
1.08
100.91
$
2,522,656
Aaa
AAA
$
55,364,000
Subtotal
$
55,498,391
2.09
$
55,966,017
Agencies -- Callable
$
2,500,000
FED FARM CREDIT BANK
1.90
11/16/12
$
2,511,692
0.78
100.34
$
2,508,594
Aaa
AAA
$
2,500,000
FED FARM CREDIT BANK
1.90
11/16/12
$
2,511,692
0.78
100.34
$
2,508,594
Aaa
AAA
$
7,000,000
FED HOME LOAN BANK
0.50
9/24/12
$
7,000,000
0.75
100.06
$
7,004,375
Aaa
AAA
$
2,500,000
FED HOME LOAN MTG CORP
1.20
6/15/12
$
2,502,808
1.08
100.56
$
2,513,960
Aaa
AAA
$
6,000,000
FED HOME LOAN MTG CORP
0.50
9/7/12
$
6,000,000
0.50
100.08
$
6,004,860
Aaa
AAA
$
2,500,000
FED NATIONAL MTG ASSOC
1.88
10/29/12
$
2,513,778
0.41
100.28
$
2,507,031
Aaa
AAA
$
23,000,000
Subtotal
$
23,039,971
0.69
$
23,047,414
Local Government Investment Pool
$
49,833,624
L.A.I.F.
0.00
8/1/10
$
49,833,624
0.53
100.00
$
49,833,624
U
U
$
22,120
L.A.I.F. (HOUSING)
0.00
8/1/10
$
22,120
0.53
100.00
$
22,120
U
U
1 $
49,855,745
Subtotal
$
49,855,745
0.53
$
49,855,745
"U" = Unrated
Page 7
Palm Desert Redevelopment Agency
Portfolio Holdings
July 31, 2010
Market
Par Value ( Issuer Coupon I Maturity Cost YTM I Price I Value
Local Government Investment Pool
$
17,493,590
L.A.I.F. / WELLS FARGO
0.00
$
4,811,088
L.A,I.F. / WELLS FARGO
0.00
$
25,188,793
L.A.I.F. / WELLS FARGO
0.00
$
1,692,270
L.A.I.F. / WELLS FARGO
0.00
$
15,154,481
L.A.I.F. / WELLS FARGO
0.00
$
16,534,174
L.A.I.F. / WELLS FARGO
0.00
$
80,874,397
Subtotal
Local
Government Investment Pool
$
75,349
C.A.M.P.
0.00
$
2,113,385
C.A.M.P. (HOUSING)
0.00
$
2,188,734
Subtotal
Money Market Fund
$
70,239,705
W F ADVANTAGE GOUT MMF
0.00
$
70,239,705
Subtotal
Municipal
Bonds
$
3,151,000
CITY OF PALM DESERT
3.00
$
3,151,000
Subtotal
Total Investments
$
297,123,580
Cash
$
197,686
HOUSING AUTH CHKG
0.0C
$
403,492
HOUSING AUTH TRUST
0.00
$
601,178
Subtotal
Total Investments and Cash
$ 297,724,758
8/1/10 $ 17,493,590 0.53 100.00 $ 17,493,590
8/1/10
$
4,811,088
0.53
100.00
$
4,811,088
8/1/10
$
25,188,793
0.53
100.00
$
25,188,793
811/10
$
1,692,270
0.53
100.00
$
1,692,270
8/1/10
$
15,154,481
0.53
100.00
$
15,154,481
8/1/10
$
16,534,174
0.53
100.00
$
16,534,174
$
80,874,397
0.53
$
80,874,397
8/1/10
$
75,349
0.31
100.00
$
75,349
8/1/10
$
2,113,385
0.31
100.00
$
2,113,385
$
2,188,734
0.31
$
2,188,734
811/10 $ 70,239,705 0.00 100.00 $ 70,239,705
$ 70,239,705 0.00 $ 70,239,705
9/2/29 $ 3,151, 000 3.00 100.00 $ 3,151, 000
$ 3,151,000 3.00 $ 3,151,000
$ 297,910,511 0.76 $ 298,417,102
'Ratings
Moody's I S&P
U AA
U AA
U AA
U AA
U AA
U AA
U AAA
U AAA
Aaa AAA
U AA
8/1/10 $
197,686
0.00 100.00 $
197,686 U U
811/10 $
403,492 _
0.00 100.00 $
403,492 U U
$
601,178
$
601,178 1
$ 298,511,689 $ 299,018,280
"U" = Unrated
Page 8
IPar Value
Palm Desert Redevelopment Agency
Portfolio Holdings
July 31, 2010
Market
Issuer Coupon I Maturity Cost YTM I Price I Value
% of Portfolio
Corporate Issuers (Market Value)
ABBOTT LABS 1.02%
BEAR STEARNS (JPM) 1.27%
JP MORGAN CHASE 2.08%
% of Portfolio
Agency Issuers (Market Value)
FED FARM CREDIT BANK 3.33%
FED HOME LOAN BANK 2.37%
FED HOME LOAN MTG CORP 4.78%
FED NATIONAL MTG ASSOC 5.71%
Ratings
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 July 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 August 24, 2010,
ivaais i�idvom C. C. V. 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
0.0% 1.1%
53632(c)
Savings Accounts
No Limit
No Limit
No Limit
No Limit
0.0% 0.0%
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%
23.0% 26.4%
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
30% A
5 Years
A
30% IAAA&Aaal
14.5% ` 4.4%
53601(k)
Mutual Funds
90 Days
20 /o AAA & Aaa
90 Da s
20
15.5 to I 23.6 /o
53601(I)
Trust Indenture Debt
Not Authorized
53601(m)
Secured Bank Deposits
5 Years
No Limit
Not Authorized
53601(k)
Local Government
AAA & Aaa
I
AAA & AaaI
1
I
Investment Pools
90 Days
20% or Advisor
90 Days 120%
(2) or Advisor (
14.80/(o 0.7%
53601(n)
Mortgage -Backed
5 Years
20% A (Issuer) &
Not Authorized
Securities
AA (Security)
16429.1(b)
LAIF
No Limit
No Limit
20.6% 43.9%
(1) The City loan to RDA, which is not a bond, has been approved by the Palm Desert City Council.
88.2% 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
M
City of Palm Desert
City and Redevelopment Agency Portfolios
COMPLIANCE ANALYSIS AND INVESTMENT REPORT
August 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) met on September 21, and indicated that it would purchase more U.S. public
debt, if necessary, in order to boost economic growth or to prevent inflation from falling further.
The "Great Recession" has officially ended. According to the National Bureau of Economic Research, a group of
academic economists who determine the widely accepted benchmarks for U.S. recessions, the 2007-2009 recession ended
in June 2009. The worst slump since the Great Depression, it wiped out 7.3 million jobs; cut 4.1 % from U.S. economic
output; cost Americans 21% of their net worth; and triggered 2.5 million home foreclosures. What remains is a weak
recovery and a high U.S. Unemployment Rate of 9.6% (or 22% if pre-1994 U.S. Unemployment Rate statistical analysis is
used -- (www.shadowstats.com)).
U.S. Treasury bond prices fell in early September as demand for riskier assets created more selling pressure. Weak
economic growth, deflation fears, and low interest rates prompted many investors to embrace a "barbell" portfolio strategy in
order to balance risk and boost yield. Money managers bought longer -dated bonds, corporate bonds, and "junk bonds." In
the case of junk bonds, investors were gambling that the default rate would not get worse, barring another recession. Due to
strong demand, these junk bonds actually had fewer contractual protections than those sold five years ago.
Pis 4jaJ<nV, c.C.M r
City Treasurer
PORTFOLIO STATISTICS
Dollars in Thousands
AUG-10
JUL-10
JUN-10
MAY-10
APRA0
MAR-10
CITY
Month -End Book Value***
$
206,273
$ 197,878
$
201,932
$
201,783
$ 198,943
$
197,952
Month -End Market Value***
$
206,833
$ 198,453
$
202,476
$
202,374
$ 199,620
$
198,665
Paper Gain (Loss)
$
560
$ 575
$
544
$
591
$ 677
$
713
Prior Year Book Variance
$
(22,125)
$ (28,582)
$
(27,016)
$
(22,506)
$ (19,020)
$
(18,722)
Interest Earnings
166
173
227
207
233
227
Yield -To -Maturity
0.93%
1.12%
1.16%
1.28%
1.45%
1.43%
Weighted Maturity (Days)
295
351
363
415
461
465
Effective Duration
0.17
0.21
0.23
0.23
0.28
0.35
RDA
Month -End Book Value ***
$
276,345
$ 298,512
$
302,563
$
299,721
$ 285,335
$
295,407
Month -End Market Value ***
$
276,806
$ 299,018
$
303,003
$
299,998
$ 285,685
$
295,786
Paper Gain (Loss)
$
461
$ 506
$
440
$
277
$ 350
$
379
Prior Year Book Variance
$
471
$ 14,305
$
15,272
$
6,001
$ 32,808
$
27,030
Interest Earnings
193
195
200
171
175
174
Yield -To -Maturity
0.79%
0.76%
0.78%
0,69%
0.74%
0.70%
Weighted Maturity (Days)
367
339
344
226
237
229
Effective Duration
0.51
0.49
0.51
0.31
0.34
0.35
*** Omits SLGSs.
Dollars in Thousands
Aaeina Interval
< I
< 2M
< 3M
< 6M
< 1 YR
< 2YR
< 3YR
< 4YR
< 5YR
> 5YR
Total:
Ratings
AAA
AA
A
Unrated"
Total:
Sector
MMF
Agencies
MTNs
CAMP
RDA Loan
LAIF
Total:
Month
Sep09
Oct
Nov
Dec
Jan10
Feb
Mar
Apr
May
Jun
Jul
Aug
City of Palm Desert -- Portfolio Characteristics
August 31, 2010
Market Value
$ 73,395
12,073
1,923
8,158
17,257
12,146
15,047
$ 139,999
Market Value
$ 65,308
86,272
10,032
41,924
$ 203,536
Market Value
$ 34,297
42,310
24,240
40,375
22,655
39,659
$ 203,536
Citv Yield LAIF Yield
1.74
0.76
1.69
0.65
1.93
0.61
1.82
0.57
1.31
0.56
1.41
0.58
1 A3
0.55
1,41
0.59
1.25
0.56
1.16
0.53
1.12
0.53
0.93
0.51
General Fund Ageing
100 -...... .. ... ........ __. .
80 -
0 60 - 52
40 -
0
a 20 - 9 1 6 12 9 11 !
n n r-1 j-j 0 0 0
1 M 2M 3M 6M 1 YR 2YR 3YR 4YR 5YR 5YR
Credit Quality AAA
32%
AA
Unrated " 42%
21%
A
5%
`Asset Allocation
Variance / PerformanceM
0.98
1.05 2.1
1.32 _ - -
1.26
0.76
0.83 m
0.88 >- 0.7
0.83
0.69 0.0 a
0.63 SepOlDctNovDedan1Feb Mar AprMayJun Jul Aug
0.41 o
MTNs
12%
CAMP
Agencies 20%
21% ,
RDA Loan
MMF 11 %
17% LAIF
19%
A
Standard and Poors
LAIF, and City Loan to RDA Page 2
City of Palm Desert
Portfolio Holdings
August 31, 2010
Market
Ratings
Par Value
Issuer
Coupon
Maturity
Cost
YTM
I Price
Value
I Moody's
S&P
Medium -Term Notes
$
3,795,000
BANK OF AMERICA
5.38
8/15/11
$
3,839,403
4.05
104.42
$
3,962,754
A2
A
$
3,000,000
BANK OF AMERICA
4.25
10/1/10
$
3,002,498
3.20
100.27
$
3,007,962
A2
A
$
2,035,000
GENERAL ELECTRIC
4.88
10/21110
$
2,033,122
5.63
100.57
$
2,046,671
Aa2
AA+
$
1,891,000
GENERAL ELECTRIC
6.88
11/15/10
$
1,895,161
5.65
101.27
$
1,915,048
Aa2
AA+
$
2,000,000
GENERAL ELECTRIC
6.13
2/22/11
$
2,003,782
5.67
102.69
$
2,053,740
Aa2
AA+
$
3,965,000
GENERAL ELECTRIC
4.88
10/21/10
$
3,973,608
3.23
100.57
$
3,987,739
Aa2
AA+
$
3,000,000
TOYOTA
4.35
12/15/10
$
3,033,777
0.44
101.12
$
3,033,600
Aal
AA
$
4,000,000
WELLS FARGO BANK
6.38
8/1/11
$
4,040,314
5.13
105.81
$
4,232,500
Al
AA
$
23,686,000
Subtotal
$
23,821,665
3.93
$
24,240,014
Agencies
-- Coupon
$
3,000,000
FED FARM CREDIT BANK
3.50
10/3/11
$
3,081,737
0.97
103.38
$
3,101,250
Aaa
AAA
$
3,000,000
FED HOME LOAN BANK
1.63
7/27/11
$
3,021,412
1.18
101.16
$
3,034,688
Aaa
AAA
$
3,000,000
FED HOME LOAN BANK
0.44
1017/10
$
3,000,357
0.32
100.03
$
3,000,938
Aaa
AAA
$
3,000,000
FED HOME LOAN BANK
1.63
3/16/11
$
3,018,356
0.41
100.78
$
3,023,438
Aaa
AAA
$
3,000,000
FED HOME LOAN BANK
1.10
8/28/12
$
2,999,411
1.11
100.84
$
3,025,313
Aaa
AAA
$
3,000,000
FED HOME LOAN MTG CORP
1.63
4/26/11
$
3,019,174
0.60
100.88
$
3,026,250,
Aaa
AAA
-$
3,000,000
FED HOME LOAN MTG CORP
4.13
2/24/11
$
3,051,772
0.52
101,81
$
3,054,375
Aaa
AAA
$
3,000,000
FED NATIONAL MTG ASSOC
1.75
12/28/12
$
2,996,460
1.91
100.38
$
3,011,250
Aaa
AAA
$
24,000,000
Subtotal
$
24,188,680
0.88
$
24,277,500
Agencies -- Callable
$
3,000,000
FED HOME LOAN BANK
1.00
10/28/11
$
3,000,000
1.00
100.09
$
3,002,813
Aaa
AAA
$
2,980,000
FED HOME LOAN BANK
1.88
11/19/12
$
2,985,075
1.61
100.31
$
2,989,313
Aaa
AAA
$
3,000,000
FED HOME LOAN BANK
1.85
12/21/12
$
3,000,735
1.82
100.31
$
3,009,375
Aaa
AAA
$
3,000,000
FED HOME LOAN MTG CORP
1.25
1/26/12
$
3,000,000
1.25
100.29
$
3,008,553
Aaa
AAA
$
6,000,000
FED NATIONAL MTG ASSOC
1,75
12/28/12
$
5,993,210
1.90
100.38
$
6,022,500
Aaa
AAA
$
17,980,000
Subtotal
$
17,979,020
1.58
$
18,032,553
Local Agency Investment Fund
$
39,658,990
L.A.I.F.
0.00
9/1/10
$
39,658,990
0.51
100.00
$
39,658,990
U
U
$
39,658,990
Subtotal
$
39,658,990
0.51
$
39,658,990
Local Agency Investment Fund
$
40,317,541
C.A.M.P.
0.00
9/1/10
$
40,317,541
0.31
100.00
$
40,317,541
U
AAA
$
57,732
C.A.M.P. (DESERT WILLOW)
0.00
9/1/10
$
57,732
0.31
100.00
$
57,732
U
AAA
$
40,375,273
Subtotal
$
40,375,273
0.31
$
40,375,273
Money Market Fund
$
34,296,493
WF ADVANTAGE GOUT MMF
0.00
9/1/10
$
34,296,493
0.00
100.00
$
34,296,493
Aaa
AAA
$
34,296,493
Subtotal
$
34,296,493
0.00
$
34,296,493
"U" = Unrated Page 3
IPar Value I Issuer
City Loan to RDA
$ 22,655,000 CITY OF PALM DESERT
$ 22,655,000 Subtotal
Total Investments
$ 202,651,755
Cash
$ 2,726,493 CITY MAIN CHKG
$ 470,372 DESERT WILLOW CHKG
$ 100,711 RECREATIONAL FAC CHKG
$ 3,297,576 Subtotal
Total Investments and Cash
$ 205,949,332
Corporate Issuers
BANK OF AMERICA
GENERAL ELECTRIC
TOYOTA
WELLS FARGO BANK
City of Palm Desert
Portfolio Holdings
August 31, 2010
Market
Coupon I Maturity Cost YTM I Price I Value
0.00 911/40 $ 22,655,000 0.51 100.00 $ 22,655,000
$ 22,655,000 0.51 $ 22,655,000
$ 202,975,121 0.93 $ 203,535,823
Ratings
Moody's I S&P
U
0.00 9/1/10 $
2,726,493 0.00
100.00 $
2,726,493 U
0.00 9/1/10 $
470,372 0.00
100.00 $
470,372 U
0.00 9/1/10 $
100,711 0.00
100.00 $
100,711 U
$
3,297,576
$
3,297,576
$ 206,272,698
% of Portfolio
(Market Value)
3.37%
4.84%
1.47%
2.05%
$ 206,833,399
U
U
U
U
"U" = Unrated Page 4
I Par Value
Issuer
Agency Issuers
City of Palm Desert
Portfolio Holdings
August 31, 2010
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)
1.50%
10.19%
4.39%
4.37%
Market Ratings
YTM I Price I Value Moody's I S&P
"U" = Unrated Page 5
Dollars in Thousands
Aaeina Interval
< 1 M
< 2M
< 3M
< 6M
< 1YR
< 2YR
< 3YR
< 4YR
< 5YR
> 5YR
Total:
ualit
AAA
AA
A
Unrated *'
Total:
Sector
MMF
Agencies
MTNs
CAMP
LAIF
EIP
LAIF/Bond Proceeds
Total:
Month
Sep09
Oct
Nov
Dec
Jan10
Feb
Mar
Apr
May
Jun
Jul
Aug
RDA Yield
0.95
0.96
1.21
1.21
0.72
0.69
0.70
0.74
0.69
0.78
0.76
0.79
Palm Desert Redevelopment Agency -- Portfolio Characteristics
August 31, 2010
Market Value
$ 51,322
3,003
16,196
34,122
28,073
3,151
$ 135,867
Market Value
$ 138,867
86,272
10,032
40,556
$ 275,727
Market Value
$ 58,260
78,918
13,086
1,689
40,556
3,151
80,067
$ 275,727
LAIF Yield
0.76
0.65
0.61
0.57
0.56
0.58
0.55
0.59
0.56
0.53
0.53
0.51
Variance
0.19
0.32
0.59
0.64
0.16
0.12
0.15
0.15
0.13
0.25
0.23
0.28
Portfolio Ageing w/o SLGSs�
i
0
t
p
a
i
Credit Quality
Asset Allocation
Performance
m
r
100----------------- __...._.......______.---_.....____...._.__..._.._..
80 -
60 -
38
40 25
12 21
20 n
0 2 0 n I I 0 0 2
0
1M 2M 3M 6M 1YR 2YR 3YR 4YR 5YR 5YR
AAA AA
50% 31 %
Unrated "
15% A
4%
Agencies
28% MTNs
5% CAMP
1%
MMF LAIF
21% 15%
EIP
LAIF/Bond 1%
Proceeds
29%
6
p
0.7
I
i
0.0
SepODet Nov Dedanl0=eb Mar Apr May Jun Jul Aug
® LAIF Yield
0 RDA Yieid
Standard and Poors
"* LAIF Page 6
Palm Desert Redevelopment Agency
Portfolio Holdings
August 31, 2010
Market
Ratings
Par Value
Issuer
Coupon
I Maturity
Cost
YTM
Price
Value
Moody's S&P
Medium -Term Notes
$
3,000,000
ABBOTT LABS
3.75
3/15/11
$ 3,050,662
0.60
101.79
$
3,053,778
Al AA
$
3,450,000
BEAR STEARNS CO. (JPM)
6.95
8/10/12
$ 3,783,532
1.83
110.71
$
3,819,588
Aa3 A+
$
3,000,000
JP MORGAN CHASE
3.13
12/1/11
$ 3,082,917
0.69
103.35
$
3,100,455
Aa3 A+
$
3,000,000
JP MORGAN CHASE
5.60
6/1/11
$ 3,106,002
0.85
103.75
$
3,112,368
Aa3 A+
$
12,450,000
Subtotal
$ 13,023,113
1.04
$
13,086,189
Agencies -- Coupon
$
4,900,000
FED FARM CREDIT BANK
4.90
9/22/10
$
4,900,684
4.65
100.28
$
4,913,781
Aaa
AAA
$
2,000,000
FED HOME LOAN BANK
4.88
3/11/11
$
1,993,907
5.49
102.44
$
2,048,750
Aaa
AAA
$
2,000,000
FED HOME LOAN BANK
4.88
3/11/11
$
1,993,826
5.50
102.44
$
2,048,750
Aaa
AAA
$
2,890,000
FED HOME LOAN BANK
2.88
3/11/11
$
2,926,164
0.49
101.34
$
2,928,834
Aaa
AAA
$
3,000,000
FED HOME LOAN BANK
0.50
11/29/10
$
3,001,529
0.36
100.06
$
3,001,875
Aaa
AAA
$
3,000,000
FED HOME LOAN BANK
1.13
12/9/11
$
3,007,351
0.96
100.88
$
3,026,250
Aaa
AAA
$
2,000,000
FED HOME LOAN BANK
1.10
8/28/12
$
1,999,608
1.11
100.84
$
2,016,875
Aaa
AAA
$
2,500,000
FED HOME LOAN BANK
1.10
8/28112
$
2,499,510
1.11
100.84
$
2,521,094
Aaa
AAA
$
2,500,000
FED HOME LOAN BANK
1.10
8128112
$
2,499,517
1.11
100.84
$
2,521,094
Aaa
AAA
$
2,500,000
FED HOME LOAN BANK
1.38
10/29/12
$
2,509,287
1.20
101.47
$
2,536,719
Aaa
AAA
$
4,900,000
FED HOME LOAN BANK
1.75
12/14/12
$
4,944,448
1.40
101.88
$
4,991,875
Aaa
AAA
$
3,000,000
FED HOME LOAN BANK
1.10
8/28/12
$
2,999,420
1.11
100.84
$
3,025,313
Aaa
AAA
$
2,000,000
FED HOME LOAN MTG CORP
6.88
9/15/10
$
2,000,914
5.54
100.28
$
2,005,625
Aaa
AAA
$
3,734,000
FED HOME LOAN MTG CORP
6.88
9/15/10
$
3,735,710
5.54
100.28
$
3,744,502
Aaa
AAA
$
2,940,000
FED NATIONAL MTG ASSOC
1.75
3/23/11
$
2,960,634
0.43
100.81
$
2,963,888
Aaa
AAA
$
9,000,000
FED NATIONAL MTG ASSOC
1.00
11/23/11
$
9,006,543
1.00
100.75
$
9,067,500
Aaa
AAA
$
2,500,000
FED NATIONAL MTG ASSOC
1.13
7/30112
$
2,502,451
1.08
100.91
$
2,522,656
Aaa
AAA
$
55,364,000
Subtotal
$
55,481,503
2.09
$
55,885,380
Agencies -- Callable
$
2,500,000
FED FARM CREDIT BANK
1.90
11/16/12
$
2,511,267
0.78
100.25
$
2,506,250
Aaa
AAA
$
2,500,000
FED FARM CREDIT BANK
1.90
11/16/12
$
2,511,267
0.78
100.25
$
2,506,250
Aaa
AAA
$
7,000,000
FED HOME LOAN BANK
0.50
9/24/12
$
7,000,000
0.75
100.03
$
7,002,188
Aaa
AAA
$
2,500,000
FED HOME LOAN MTG CORP
1.20
6/15/12
$
2,502,683
1.08
100.52
$
2,512,983
Aaa
AAA
$
6,000,000
FED HOME LOAN MTG CORP
0.50
9/7/12
$
6,000,000
0.50
100.00
$
6,000,150
Aaa
AAA
$
2,500,000
FED NATIONAL MTG ASSOC
1.88
10/29/12
$
2,513,266
0.41
100.19
$
2,504,688
Aaa
AAA
$
23,000,000
Subtotal
$
23,038,484
0.69
$
23,032,508
Local Government Investment Pool
$
40,533,624
L.A.I.F.
0.00
9/1110
$
40,533,624
0.51
100.00
$
40,533,624
U
U
$
22,120
L.A.I.F. (HOUSING)
0.00
9/1/10
$
22,120
0.51
100.00
$
22,120
U
U
$
40,555,745
Subtotal
$
40,555,745
0.51
$
40,555,745
"U" = Unrated Page 7
Palm Desert Redevelopment Agency
Portfolio Holdings
August 31, 2010
Market
Par Value Issuer Coupon I Maturity Cost YTM Price Value
Local Government Investment Pool
$
17,201,590
L.A.I.F. / WELLS FARGO
0.00
$
4,811,088
L.A.I.F. / WELLS FARGO
0.00
$
24,673,793
L.A.I.F. / WELLS FARGO
0.00
$
1,692,270
L.A.I.F. / WELLS FARGO
0.00
$
15,154,481
L.A.I.F. / WELLS FARGO
0.00
$
16,534,174
L.A.I.F. / WELLS FARGO
0.00
$
80,067,397
Subtotal
Local Government Investment Pool
$
1,613,854
C.A.M.P.
0.00
$
75,369
C.A.M.P. (HOUSING)
0.00
$
1,689,223
Subtotal
Money Market Fund
$
58,259,866 WF ADVANTAGE GOVT MMF
0.00
$
58,259,866
Subtotal
Municipal Bonds
$
3,151,000
CITY OF PALM DESERT
3.00
$
3,151,000
Subtotal
Total Investments
$
274,537,231
Cash
$
669,636
HOUSING AUTH CHKG
0.00
$
408,786
HOUSING AUTH TRUST
0.00
$
1,078,422
Subtotal
Total Investments and Cash
$ 275,615,653
9/1/10
$
17,201,590
0.51
100.00
$
17,201,590
9/1110
$
4,811,088
0.51
100.00
$
4,811,088
9/1/10
$
24,673,793
0.51
100.00
$
24,673,793
9/1/10
$
1,692,270
0.51
100.00
$
1,692,270
9/1/10
$
15,154,481
0.51
100.00
$
15,154,481
9/1/10
$
16,534,174
0.51
100.00
$
16,534,174
$
80,067,397
0.51
$
80,067,397
9/1/10
$
1,613,854
0.31
100.00
$
1,613,854
9/1/10
$
75,369
0.31
100.00
$
75,369
$
1,689,223
0.31
$
1,689,223
9/1/10 $ 58,259,866 0.00 100.00 $ 58,259,866
$ 58,259,866 0.00 $ 58,259,866
9/2/29 $ 3,151,000 3.00 100.00 $ 3,151,000
$ 3,151,000 3,00 $ 3,151,000
$ 275,266,331 0.79 $ 275,727,307
9/1/10 $ 669,636 0.00 100.00 $ 669,636
9/1/10 $ 408,786 0.00 100.00 $ 408,786
$ 1,078,422 $ 1,078,422
$ 276,344,753 $ 276,805,730
Ratings
Moody's
S&P
U
AA
U
AA
U
AA
U
AA
U
AA
U
AA
U AAA
U AAA
Aaa AAA
U AA
U
U
U
U
"U" = Unrated Page 8
Par Value
Palm Desert Redevelopment Agency
Portfolio Holdings
August 31, 2010
Issuer I Coupon I Maturity I Cost
% of Portfolio
Corporate Issuers (Market Value)
ABBOTT LABS 1.10%
BEAR STEARNS CO. (JPM) 1.38%
JP MORGAN CHASE 2.24%
% of Portfolio
Agency Issuers (Market Value)
FED FARM CREDIT BANK
3.59%
FED HOME LOAN BANK
13.61%
FED HOME LOAN MTG CORP
5.15%
FED NATIONAL MTG ASSOC
6.16%
Market
YTM Price Value
Ratings
Moody's 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 August 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 September 28, 2010,
pis cif, C. C. Xt. 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% 1.1%
53632(c)
Savings Accounts
No Limit
No Limit
No Limit
No Limit
0.0% 0.0%
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%
20.8% 28.5%
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
53601(i)
Medium -Term Notes
5 Years
0
30%
A
5 Years
0to
30 A
IAAA&Aaal
11..
7 0/0 47 0/o
53601(k)
Mutual Funds
90 Days
20%
AAA & Aaa
90 Days
20% (2)
16.9% 21.2%
53601(l)
Trust Indenture Debt
Not Authorized
53601(m)
Secured Bank Deposits
5 Years
No Limit
Not Authorized
53601(k)
Local Government
AAA & Aaa
I AAA & Aaa I
I
l
Investment Pools
90 Days
20%
or Advisor
90 Days
20% (2) ( or Advisor 1
19.90/6 0.6%
53601(n)
Mortgage -Backed
5 Years
20%
A (Issuer) &
Not Authorized
Securities
AA (Security)
16429.1(b)
LAIF
No Limit
No Limit j
19.5% 43.8%
(1) The City loan to RDA, which is not
a bond, has been approved
by the Palm Desert City Council.
88.9% 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