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    11.    
City Council Regular
Meeting Date: 02/14/2017  

SUBJECT:
TREASURER’S REPORT FOR DECEMBER 2016
RECOMMENDATION:
Approve the Treasurer’s Report for December 2016.
BACKGROUND/ANALYSIS:
The Treasurer’s Report for December 2016 may be seen in Exhibit A (attached).  The amount of cash and investments for all funds amounts to $182,039,822.51.
 
The amount of cash shown in the checking accounts may be either a positive or negative (overdrawn) amount, depending on whether or not there is an opportunity to invest the “float” amount.  It is the Treasurer’s intention to invest all cash not needed for the immediate cash flow needs of the City.  The cash flow for all major fund types is also reported in Exhibit A.  As shown, the City’s cash reserves, coupled with the month’s cash receipts, are sufficient to meet the City’s cash disbursement requirements for the month.  Additionally, there are sufficient reserves and forecasted cash receipts to meet the City’s budgeted expenditure requirements for the remainder of the fiscal year.

Attached are copies of the summary reports received from the agency pools and Government Obligations and money market mutual funds in which the City invests.  Due to the different styles and lengths of reports, only summary information is excerpted from the reports and attached as exhibits to the Treasurer’s Report.  Additionally, the agencies reports that will be attached to the City Treasurer’s Report may not necessarily correspond according to dates due to the lag time in producing and mailing these reports.

Included in Exhibit A is a column showing the market value of investments the City has in the various pooled investment accounts.  The investment pools provide the market valuation information for the total pool and City staff then calculates and reports the City’s pro rata share of the market valuation amount.

The market value may show unrealized gains or losses for the pooled investments.  This does not mean that the pool has actually gained or lost any money on these transactions; it just shows what would have occurred if the pool had redeemed any of the investments as of the date of the report. Typically, the pools may not actually earn any gains nor suffer any losses, since the pools hold the investments to their maturity dates.

For interest bearing instruments (which usually comprise most, if not all, of the pools’ investments), a change in the market rate of an instrument will cause the value of the instrument to change.  For example, when the interest rates increase, the value of bonds, notes, and other interest-rate-sensitive investments will decrease.  Conversely, when the market interest rates decrease, the value of bonds, etc., will increase.  But the risk of any actual loss (or gain) occurs only if the bonds or other investments are sold before their maturity date.  If the investments are held until their maturity date, the investor will receive the total principal of the investment as well as any interest earned on the investment.
ENVIRONMENTAL (CEQA) REVIEW:
This proposed action is exempt from review under the California Environmental Quality Act (California Public Resources Code §§21000, et seq.; “CEQA”) and CEQA regulations (14 California Code Regulations §§15000, et seq.) because it does not involve any commitment to a specific project which could result in a potentially significant physical impact on the environment; and constitutes an organizational or administrative activity that will not result in direct or indirect physical changes in the environment. Accordingly, this action does not constitute a “project” that requires environmental review (see specifically 14 CCR § 15378(b)(4-5)).
FISCAL IMPACT:
In accordance with California Government Code, the Finance Director/City Treasurer certifies that sufficient investment liquidity, as well as sufficient anticipated revenues, are available to meet the City’s budgeted expenditure requirements for the six months ending June 30, 2017.  The investments reported in the Treasurer’s Report are in compliance with the City’s Investment Policy.
REVIEWED BY OTHERS:
None.
 
Attachments
Treasurer's Report - December 2016

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