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1996 11 13 IAB Minutes INVESTMENT ADVISORY BOARD MINUTES November 13, 1996 I CALL TO ORDER Regular meeting of the La Quinta Investment Advisory Board was called to order at the . hour of 5:30 P.M. by Vice Chairman Sales, followed by the Pledge of Allegiance. PRESENT: Board Members Frame, Irwin, Lewis, Osborne, Rodriguez, and Vice Chairman Sales ABSENT: Chairwoman Brown OTHER PRESENT: John Falconer, Finance Director and Debbie DeRenard, Secretary II CONFIRMATION OF AGENDA - Confirmed III PUBLIC COMMENT- N/A IV CONSENT CALENDAR A. Approval of Minutes of Meeting on October 9, 1996 for the Investment Advisory Board. MOTION - It was moved by Board Members Lewis/Frame to approve the minutes of October 9, 1996. Motion carried unanimously. V BUSINESS SESSION A. Transmittal of Treasury Report for September 30, 1996 In response to Vice Chairman Sales, Mr. Falconer advised that in September there were several large debt payments paid. MOTION - It was moved by Board Members Osborne/Rodriguez to Accept, Receive and File the Treasury Report dated September 30, 1996. Motion carried unanimously. Investment Advisory Board October 9, 1996 Minutes VI CORRESPONDENCE AND WRITTEN MATERIAL A. Month End Cash Report - October 1996 Noted and Filed. B. Investment Liquidity and Anticipated Revenues Mr. Falconer presented the staff report and advised that the Government Code requires that the Treasurer make a finding that sufficient investment liquidity and anticipated revenues are available to meet the pool's expenditure requirements for six months. In order to honestly state this, Staff is in the process of creating a report that will become part of the monthly Treasurers Report to document this certification. He advised that he has obtained a copy of the format that is used by the City of Riverside. In response to Vice Chairman Sales, Mr. Falconer advised he is not aware of an accepted cash statement format for municipalities. Mr. Falconer suggested the Board submit any ideas they have from past or current practices to Staff, a form could be devised and brought back to the Board for comments. C. Pooled Money Investment Board Report- August 1996 Board Member Irwin commented on the LAIF Board Report regarding the average life of an investment. He further advised that in LAIF's portfolio composition it list investments in foreign banks. In response to Board Member Osborne, Board Member Irwin advised that he does not know the difference in protection between the purchase of a CD from the Hong Kong Bank and the Bank of America. He further advised that if the Hong Kong Bank is a United States branch versus an off-shore bank, there would be more protection. Board Member Irwin stated that Bank of Tokyo in New York has less protection than Bank of America even though they operate in the United States. Board Member Lewis advised that he disagrees. Any Bank operating in the Investment Advisory Board October 9, 1996 Minutes United States operates under the same rules and guidelines. Board Member Irwin advised that per the LAIF report, it is unknown where the bank is located. Board Member Osborne advised that 80 percent of LAIF investments are qualified investments in the La Quinta Investment Policy. D. Updated Investment Policies In response to Board Member Lewis, Mr. Falconer advised that City Council considered the Board's recommendation and changed the LAIF percentage to 40 percent. The City Council reviewed the percentages invested in LAIF for June, July and August and felt that the percentages could be reduced to 40 percent. Board Member Lewis questioned Council reducing the LAIF percentages at a time when fund balances were at their lowest and percentages were down. Board Member Irwin stated that there were other reasons. Staff indicated in June that they would reduce the LAIF percentages to 25 percent by the end of the year and for some reason Staff decided not to move it to 25 percent. In response to Board Member Osborne, Board Member Irwin advised that Staff indicated in June they were prepared to get LAIF down to 25 percent by the end of the year. Board Member Lewis advised that it was his understanding that Staff was going to attempt to keep the LAIF level at 25 percent, not that they were going to set it as a policy. Board Member Irwin advised that he interpreted the discussion differently. E. Reporting to the City Council - Status Update Mr. Falconer presented the Staff Report and indicated that the City Council will be di.scussing this at their November 19, 1996 meeting as part of the Handbook for Commissions, Boards and Committees. Investment Advisory Board October 9, 1996 Minutes VII BOARD MEMBER ITEMS In response to Vice Chairman Sales, Mr. Falconer advised that the Annual Financial Statement will be placed on the December Agenda. In response to Board Member Osborne, Ms. DeRenard advised that the Annual Financial Statement will be sent to the Board in adequate time to review them. Mr. Falconer advised that the report is scheduled to go to the City Council on December 3rd and it will be released after that date. In response to Board Member Irwin, Mr. Falconer advised that the Government Accounting Standards Board (GASB) is continuing an exposure draft to receive comments on the Mark to Market of investments. The City Portfolio would not be impacted by this exposure draft and would comply with its requirements when finally adopted. It could be as soon as July 1997. In response to Board Member Lewis, Mr. Falconer advised that the Agenda Packets could be mailed out a day earlier in the future. VIII ADJOURNMENT MOTION -It was moved by Board Members Lewis/Osborne to adjourn the meeting. Motion carried unanimously.