2000 12 13 IABP.O. Box 1504
78-495 CALLS TAMPICO (760) 777-7000
LA QUINTA, CALIFORNIA 92253 FAX (760) 777-7101
AGENDA
INVESTMENT ADVISORY BOARD
Study Session Room
78-495 Calle Tampico- La Quinta, CA 92253
December 13, 2000 - 5:30 P.M.
I CALL TO ORDER
a. Pledge of Allegiance
b. Roll Call
PUBLIC COMMENT -(This is the time set aside for public comment on any matter not scheduled on the agenda.)
III CONFIRMATION OF AGENDA
IV CONSENT CALENDAR
A. Approval of Minutes of Meeting on November 8, 2000 for the
Investment Advisory Board.
V BUSINESS SESSION
A. Transmittal of Treasury Report for October 2000
VI CORRESPONDENCE AND WRITTEN MATERIAL
A. Month End Cash Report and other selected Financial Data -
November 2000
B. Pooled Money Investment Board Reports - September 2000
C. Quarterly Updates for LAIF Answer Book
D. Legislative Updates
VII BOARD MEMBER ITEMS
VIII ADJOURNMENT
INVESTMENT ADVISORY BOARD Business Session: A
Meeting Date: December 13, 2000
WIT411111
Transmittal of Treasury Report
for October 31, 2000
' ► t i • ►I0
Attached please find the Treasury Report October 31, 2000.
Review, Receive and File the Treasury Report for October 31, 2000.
Joh6"M. Falconer/Finance Director
MEMORANDUM
TO: La Quinta City Council
FROM: John M. Falconer, Finance Director/Treasurer
SUBJECT: Treasurer's Report for October 31, 2000
DATE: November 30, 2000
Attached is the Treasurer's Report for the month ending October 31, 2000. The report is submitted to
the City Council each month after a reconciliation of accounts is accomplished by the Finance Dept.
The following table summarizes the changes in investment types for the month:
Investment
Beginning
Purchased
Sold/Matured
Other
Ending
Change
Cash (1)
$1071829
8161733
924,562
816,733
LAIF
$4,645,922
8591652
0
5,5051574
859,652
US Treasuries (2)
$32,8651550
31000,000
(4,000,000)
75,010
31,940,560
(924,990)
US Gov't Agencies (2)
$17,591,486
57,335
17,648,821
57,335
Commercial Paper (2)
$1,493,002
2,000,000
(1,500,000)
(3,769)
1,989,233
496,231
Mutual Funds
$3,1301638
11044,069
4,174,707
1,044,069
Total
$59 834 427
6 903 721
5 500 000
945 309
62,1831457
2,349)030
I certify that this report accurately reflects all pooled investments and is in compliance with the California
Government Code; and ins in conformity with the City Investment Policy.
As Treasurer of the City of La Quinta, I hereby certify that sufficient investment liquidity and anticipated
revenues are available to meet the pools expenditure requirements for the next six months. the City of
La Quinta used the Bureau of the Public Debt, U.S. Bank Monthly Statement and. the Bank of New York
Monthly Custodian Report to determine the fair market value of investments at month end.
/Z-/00
Da e
Footnote
(1) The amount reported in the other column represents the net increase (decrease) of deposits and
withdrawals from the previous month.
(2) The amount reported in the other column represents the amortization of premium/discount for the
month on US Treasury, Commercial Paper and Agency investments.
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068
CITY OF LA QWNTA
CITY
CITY
RDA RDA
FA
BALANCE SHEET 10/31/00
FIXED
LONG TERM
FIXED LONG TERM
FINANCING
LONG TERM
GRAND
CITY ASSETS
DEBT
RDA
ASSETS DEBT
AUTHORITY
DEBT
TOTAL
ASSETS:
POOLED CASH
(5,748,960.75)
11,154,011.16
(1,308.54)
5,403,741.87
LQRP INVESTMENT IN POOLED CASH
808,396.43
808,396.43
INVESTMENT T-BILUNOTES & OTHER
43,980,000.00
43,980,000.00
AUTO MALL CASH
2O3,604.84
203,604.84
LQRP CASH
32,158.70
32,158.70
BOND REDEMPTION CASH
55,872.23
1,238.81
57,111.04
BOND RESERVE CASH
BOND PROJECT CASH
11,490,144.69
608,685.28
12,098,829.97
BOND ESCROW CASH
PETTY CASH
1,000.00
1,000.00
CASH & INVESTMENT TOTAL
38,435,644.09
23,540,583.21
608,615.55
62,584,842.85
INVESTMENT IN LAND HELD FOR RESALE
ACCOUNTS RECEIVABLE
45,515.41
60,900.00
8,010,000.00
8,116,415.41
PREMIUM/DISCOUNT ON INVESTMENT
(382,619.90)
(16,421.45
(2,344.80)
(401,386.16)
LQRP-ACCOUNTS RECEIVABLE
70,758.88
70,758.88
INTEREST RECEIVABLE
LOAN/NOTES RECEIVABLE
2,678,631.60
2,678,631.60
DUE FROM OTHER AGENCIES
DUE FROM OTHER AGENCIES - CVAG
651,913.19
651,913.19
CVAG ALLOWANCE
(651,913.19)
(661,913.19)
DUE FROM OTHER GOVERNMENTS
DUE FROM OTHER FUNDS
898,614.98
551,629.04
1,450,244.02
DUE FROM RDA
8,497,550.20
8,497,550,20
INTEREST ADVANCE -DUE FROM RDA
2,196,072.02
2,196,072,02
ADVANCES TO OTHER FUNDS
NSF CHECKS RECEIVABLE
2,801.91
2.801.91
ACCRUED REVENUE
833.40
833.40
TRAVEL ADVANCES
2,044.00
2,044.00
EMPLOYEE ADVANCES
PREPAID EXPENSES
(900.00)
(900.00)
RECEIVABLE TOTAL
11,259,078.62
3,346,331.46
8,007,665.20
22,613,065.28
WORKER COMPENSATION DEPOSIT
37,637.00
37,637.00
RENT DEPOSITS
UTILITY DEPOSITS
75.00
75.00
MISC. DEPOSITS
2,100.00
2,100.00
DEPOSITS TOTAL
39,812.00
39,812.00
GENERAL FIXED ASSETS
1,386,331.67 15,590,699.00
9,988,279.05
26,965,309.72
ACCUMULATED DEPRECIATION
(812,743.27)
(812,743.27)
AMOUNT AVAILABLE TO RETIRE L/T DEBT
3,395,117.03
3,395,117.03
AMOUNT TO BE PROVIDED FOR UT DEBT
1,645,647.34
94,789,594.32
8,010,000.00
104,445,241.66
TOTAL OTHER ASSETS
573,588.40 15,590,699.00
1,645,647.34
9,988,279.05 98,184,711.35
8,010,000.00
133,992,925.14
TOTAL ASSETS
50 308 123.11 15 590 699.00
1,645,647.34 26,886,914.67
9,988,279.05 98,184,711.35
8,616,270.75
8,010,000.00
219,230,645.27
LIABILITIES
ACCOUNTS PAYABLE
1,325,626.93
DUE TO OTHER AGENCIES
145,301.16
DUE TO OTHER FUNDS
113,688.79
INTEREST ADVANCE -DUE TO CITY
ACCRUED EXPENSES
PAYROLL LIABILITIES
(914.40)
STRONG MOTION INSTRUMENTS
2,279.50
FRINGE TOED LIZARD FEES
29,661,50
SUSPENSE
3,504.52
DUE TO THE CITY OF LA QUINTA
PAYABLES TOTAL
1,619,148.00
ENGINEERING TRUST DEPOSITS
SO. COAST AIR QUALITY DEPOSITS
ARTS IN PUBLIC PLACES DEPOSITS
,363,348.67
LQRP DEPOSITS
DEVELOPER DEPOSITS
1,027,686.85
MISC. DEPOSITS
428,446.63
AGENCY FUND DEPOSITS
1,320,773.23
TOTAL DEPOSITS
3,140,255.38
DEFERRED REVENUE
OTHER LIABILITIES TOTAL
COMPENSATED ABSENCES PAYABLE
DUE TO THE CITY OF LA QUINTA
DUE TO COUNTY OF RIVERSIDE
DUE TO C.V. UNIFIED SCHOOL DIST.
DUE TO DESERT SANDS SCHOOL DIST.
BONDS PAYABLE
TOTAL LONG TERM DEBT
TOTAL LIABILITIES
EQUITY -FUND BALANCE
8,270.67
4,767,674.05
45, 540, 449.06 15, 590, 699.00
47,432.26 1,373,059.19
145,301.16
1,327,250.23 9,305.00 1,450,244.02
(914.40)
2,279.50
29, 661.50
3,504.52
1,374,682.49 9,305.00 3,003,135.49
363, 348.67
14,934.00 14,934.00
1,027,686.85
428,446.63
1,320,773.23
14,934.00 3,155,189.38
8,010,000.00 8,018,270.67
8,010,000.00 8,018,270.67
321,991.94
1, 323, 655.40
1,645,647.34
1, 645, 647.34 1, 389, 616.49
26,497,298.18 9,988,279.06
321,991.94
10, 607, 387.10
11, 931, 042.50
12, 249,102.00
12, 249,102.00
9,418,222.25
9,418,222.25
65,910,000.00
8,010,000.00 73,920,000.00
98,184,711.35
8,010,000.00 107,840,358.69
98,184,711.35 8,019,305.00 8,010,000.00 122,016,954.23
596,965.75 97,213,691.04
TOTAL LIABILITY & EQUITY 50 308 123.11 15 590 699.00 1,645,647.34 26,886,914.67 9,988,279.05 98,184,711.35 8,616,270.75 8,010,000.00 219,230,646.27
CASH & INVESTMENT TOTAL 62,584,842.85
PREMIUM/DISCOUNT ON INVESTMENT (401,386.16)
TOTAL 62,183,456.69
069
INVESTMENT ADVISORY BOARD
Meeting Date: December 13, 2000
TITLE:
Month End Cash Report - November 2000 and
Other selected Financial Data
Correspondence & Written
Material Item A
This cash report is not a complete Treasury Report (exclude petty cash, deferred
compensation and fiscal agent balances, but would report in a timely fashion
selected cash balances.
RECOMMENDATION:
Information item only.
Jclhn M. Falcon
r, Finance Director
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City of La Quinta
Cash Flow
Budget to Actual
10/31 /00
Budget
Actual
Variance
Account
10/00
10/00
10/00
Notes
Property Tax/ Tax Increment
927,659
548,324
379,336
Transient Occupancy Tax
575,593
371,938
203,655
Sales Tax
738,031
883,533
(145,502)
Other revenues
8,157,985
7,586,530
571,455
Revenues
10,399,268
9,390,325
1,008,943
Expenditures
Salaries & Fringe Benefits
1,292,308
1,354,578
(62,270)
Redevelopment Agency
1,139,019
1,651,298
(512,279)
Other expenditures
Capital Projects
4,199,653
3,058,171
2,672,709
3,058,171
1,526,943
0
Actual equal budget
Debt Service (Principal/Interest/Pass Through)
5,640,644
4,682,774
957,870
Total Expenditures
15,329,795
3,419,530 --—
1,910,265
t(4,029,2051
322
Net Revenues/Expenditures(4,930.527)F(901
003
LAIC' Performance Report http://www.treasurer.ca.gov/Stolperfhtm
Phlllp Angeds,taeraurr
Inside the State Treasurer's Office
Local Agency Investment Fund
LAIF Performance Report
Reporting Date:
Effective Date:
Quarter Yield:
Daily:
Year:
Life:
Quarter Ending 09/30/00
Apportionment Rate:
Earnings Ratio:
Fair Value Factor:
Monthly Average For October:
11 /29/00
11 /29/00
6.52%
6.53%
6.50%
187
6.47%
.00017726564634401
.999738182
6.517%
04
1 of 2 12/01/2000 11:49 AM
LAIF Performance Report
http://www.treasurer.ca.gov/Stolperf htm
Pooled Money Investment Account
Portfolio Composition
40.09 Billion
Reverses
Loans _4 74%
Corporate
Bonds
6.31 %
Commercial
Paper
16.80°
D D's/B N' s
19.35%
10/31 /0 0
Treasuries
14.54°
Time Deposits
10. 6%
Mortgages
0.0 3'0
Agencies
31.37%
■ Treasuries
❑Time Deposits
❑Mortgages
Ag encies
■ CD's/ B N's
■ Commercial Pap
■ Corporate Ponds
❑Loans
■Re�verses
COP -
a
2 of 2 12/01/2000 11:49 AM
FRB: H.15--SelecXed Interested Rate ... ly Daily Update-- November 30, 2000
http://www.federalreserve.gov/Releases/H 15/update/
Federal Reserve Sta sfic it Release
Selected Intel est Rates
.r
Release Date: November 30, 2000
H.15: Release I Release dates I About I ASCII I Historical data I Daily update
H.15 Daily Update
The weekly release is posted on Monday. Daily updates of the weekly release are posted
Tuesday through Friday on this site.
H.15 DAILY UPDATE: WEB RELEASE ONLY For immediate release
SELECTED INTEREST RATES November 30, 2000
Yields in percent per annum
Mon Tue Wed
Nov 27 Nov 28 Nov 29
Instruments
SELECTED INTEREST RATES
Federal funds (effective) 1 2 3
6.50
6.46
6.50
Commercial paper 3 4 5 6
Nonfinancial
1-month
6.50
6.51
6.49
2-month
6.54
6.52
6.54
3-month
6.50
6.52
6.48
Financial
1-month
6.47
6.47
6.50
2-month
6.56
6.56
6.53
3-month
6.53
6.52
6.52
CDs (secondary market) 3 7
1-month
6.56
6.56
6.59
3-month
6.65
6.65
6.65
6-month
6.61
6.61
6.74
Eurodollar deposits (London) 3 8
1-month
6.53
6.53
6.71
3-month
6.65
6.65
6.63
6-month
6.61
6.61
6.60
Bank prime loan 2 3 9
9.50
9.50
9.50
Discount window borrowing 2 10
6.00
6.00
6.00
U.S. Government securities
Treasury bills (secondary market) 3 4
3-month
6.14
6.10
6.06
6-month
6.06
6.02
5.96
1-year
5.89
5.85
5.80
Treasury constant maturities 11
3-month
6.33
6.28
6.24
I of 3
12/01/2000 11:48 AM
FRB; H.15--Selected Interested Rate ... ly Daily Update-- November 30, 2000
http://www.federalreserve.gov/Releases/H 15/update/
6-month
6.34
6.29
6.23
1-year
6.11
6.05
5.98
2-year
5.86
5.79
5.69
3-year
5.74
5.67
5.59
5-year
5.63
5.57
5.51
7-year
5.71
5.64
5.60
10-year
5.64
5.59
5.55
20-year
5.89
5.86
5.84
30-year
5.71
5.67
5.66
Interest rate swaps 12
1-year
6.63
6.60
6.56
2-year
6.55
6.51
6.47
3-year
6.58
6.54
6.49
4-year
6.63
6.58
6.54
5-year
6.67
6.63
6.58
7-year
6.74
6.69
6.66
10-year
6.80
6.77
6.75
30-year
6.86
6.86
6.84
Corporate bonds
Moody's seasoned
Aaa
7.41
7.38
7.37
Baa
8.29
8.19
8.18
State & local bonds 13
Conventional mortgages 14
FOOTNOTES
1. The daily effective federal funds rate is a weighted average of rates
on trades through N.Y. brokers.
2. Weekly figures are averages of 7 calendar days ending on Wednesday of
the current week; monthly figures include each calendar day in the
month.
3. Annualized using a 360-day year or bank interest.
4. On a discount basis.
5. Interest rates interpolated from data on certain commercial paper
trades settled by The Depository Trust Company. The trades represent
sales of commercial paper by dealers or direct issuers to investors
(that is, the offer side). See Board's Commercial Paper Web pages
(http://www.federalreserve.gov/releases/cp) for more information.
6. The 1-, 2-, and 3-month rates are equivalent to the 30-, 60-, and
90-day dates reported on the Board's Commercial Paper Web page.
7. An average of dealer offering rates on nationally traded certificates
of deposit.
8. Bid rates for Eurodollar deposits collected around 9:30 a.m. Eastern time.
9. Rate posted by a majority of top 25 (by assets in domestic offices)
insured U.S.-chartered commercial banks. Prime is one of several base
rates used by banks to price short-term business loans.
10. Rate for the Federal Reserve Bank of New York.
11. Yields on actively traded issues adjusted to constant maturities.
Source: U.S. Treasury.
12. International Swaps and Derivatives Association (ISDA) mid -market
par swap rates. Rates are for a Fixed Rate Payer in return for
receiving three month LIBOR, and are based on rates collected at
11:00 a.m. by Garban Intercapital plc and published on Reuters
Page ISDAFIXI. Source: Reuters Limited.
13. Bond Buyer Index, general obligation, 20 years to maturity, mixed
quality; Thursday quotations.
14. Contract interest rates on commitments for fixed-rate first mortgages.
067
2 of 3 12/01/2000 11:48 AM
FRB; H.15--Selected Interested Rate ... ly Daily Update-- November 30, 2000 http://www.federalreserve.gov/Releases/H15/update/
Source: FHLMC.
DESCRIPTION OF THE TREASURY CONSTANT MATURITY SERIES
Yields on Treasury securities at "constant maturity" are interpolated
by the U.S. Treasury from the daily yield curve. This curve, which
relates the yield on a security to its time to maturity, is based on
the closing market bid yields on actively traded Treasury securities in
the over-the-counter market. These market yields are calculated from
composites of quotations obtained by the Federal Reserve dank of New
York. The constant maturity yield values are read from the yield curve
at fixed maturities, currently 3 and 6 months and 1, 2, 3, 5, 7, 10, 20,
and 30 years. This method provides a yield for a 10-year maturity, for
example, even if no outstanding security has exactly 10 years remaining
to maturity. In estimating the 20-year constant maturity, the Treasury
incorporates the prevailing market yield on an outstanding Treasury bond
with approximately 20 years remaining to maturity.
H.15: Release I Release dates I About I ASCII I Historical data I Daily update
Home I Statistical releases
To comment on this site, please fill out our feedback form.
Last update: November 30, 2000
1►68
3 of 3 12/01/2000 11:48 AM
FRB;Commercial.Paper Rates and Outstandings
http://www.federalreserve.gov/Releases/CP/
Federal Reserve Release
L 0 h I
em MIIEMAicm
Release I About I Outstandings I Historical discount rates I Historical outstandings I Year End
Data as of November. 30, 2000 Volume
Commercial Paper Rates and Outstandings statistics
p g Derived from data supplied by The Depository Trust Company 2000: 3
Posted December 1, 2000
Yield curve
Money market basis Percent
7.4
7.3
7.2
r' 7.1
.. � 7.0
6.9
6.8
6.7
6.6
6.5
1 7
15 30 BO 90
Days to Maturity
Financial — —— Nonfinancial ••••• A2/P2
Discount rate spread
Thirty -day A2/P2 less AA nonfinancial commercial paper (daily)
01 MAY98 17NOV98 05JUN99 220EO99 09dU LOO
--- A2/P29pmad,5—day moving avenge
Basis points
110
100
90
so
70
60
50
40
30
20
1Q
25JAN 01
1 of 3
12/01 /2000 11:49 AM
FRB; Commercial. Paper Rates and Outstandings
http://www.federalreserve.gov/Releases/CP/
Discount rate history
Thirty -day commercial paper (daily)
Percent
k 8
R 7
i r
Ogg
-4 .V4� � .5
I 1 4
r
01 MAAY98 17 NOV98 08J U N99 22 0 EC99 09J U L00 25JAN01
_ Financial — — — Nonfinancial ••••• A2/P3
Outstandings
Weekly (Wednesday), seasonally adjusted
Billions of dollars
1 WO i
11
11
{
bx) [---
01 MAAY98
17 NC+V98
Financial — — — Nonfinancial
Billions of dollars
3£0
350
340
330
320
310
300
290
280
270
260
250
240
230
220
210
0 28JAN01
The daily commercial paper release will usually be available before 11:00am EST. However, the
Federal Reserve makes no guarantee regarding the timing of the daily commercial paper release.
When the Federal Reserve is closed on a business day, yields for the previous business day will
appear in the historical discount rates table. This policy is subject to change at any time without
notice.
G10
2 of 3 12/01/2000 11:49 AM
FRB: Commercial, Paper Rates and Outstandings http://www.federalreserve.gov/Releases/CP/
Commercial paper outstanding
Commercial paper outstanding, miscellaneous categories
Release I About ( Outstandings I Historical discount rates I Historical outstandings I Year End
Home I Statistical releases
To comment on this site, please fill out our feedback form.
Last update: December 1, 2000
O�1
3 of 3 12/01/2000 11:49 AM
City of La Quinta
Spread between 30 Day Al P1 Commercial Paper and 30 Day T-Note
Date
T-Bill
T-Bill
C/P
Variance
11/13/00
12/14/00
6.03%
6.47%
0.44%
11 /20/00
12/21 /00
6.43%
6.49%
0.06% T-Bill Rate appeared unusually high
11 /27/00
12/28/00
6.28%
6.49%
0.21 %
12/04/00
01 /04/01
6.13%
6.50%
0.37%
01 ;�
INVESTMENT ADVISORY BOARD
Meeting Date: December 13, 2000
TITLE:
Pooled Money Investment Board Report
for September 2000
Correspondence
& Written Material Item B
The Pooled Money Investment Board Report for September 2000 is included in the
agenda packet.
Receive & File
Join M. Falcon6r, Finance Director
STATE OF CALIFORNIA
STATE TREASURER'S OFFICE
POOLED MONEY INVESTMENT BOARD REPORT
SEPTEMBER 2000
TABLE OF CONTENTS
SUMMARY..... ....:.................................................................1
SELECTED INVESTMENT DATA.............................................2
PORTFOLIO COMPOSITION...................................................3
INVESTMENT TRANSACTIONS...............................................4
TIME DEPOSITS..................................................................19
BANK DEMAND DEPOSITS...............*** s0000s see*** osesee see****** soo oo*31
POOLED MONEY INVESTMENT BOARD DESIGNATION .......... 32
POOLED MONEY INVESTMENT ACCOUNT
SUMMARY OF INVESTMENT DATA
A COMPARISON OF SEPTEMBER 2000 WITH SEPTEMBER 1999
(DOLLARS IN THOUSANDS)
SEPTEMBER 2000 EMBERIA CHANGE
Average Daily Portfolio
$ 41,468,674 $
32,879,155
+8,589,519
Accrued Earnings
$ 221,615 $
1.42,130
+79,485
Effective Yield
6.502
5.274
+1.228
Average Life -Month End (In Days) 192 193 -1 1
Total Security Transactions
Amount
$
229177,686
$
17,460,262
+497179424
Number
481
385
+96
Total Time Deposit Transactions
Amount
$
19729,190
$
8759640
+8539550
Number
136
79
+57
Average Workday Investment Activity
$
1,195,344
$
873,138
+322,206
Prescribed Demand Account Balances
For Services
$
159,223
$
208,462
-49,239
For Uncollected Funds
$
231,139
$
178,339
+52,800
1
PHILIP ANGELIDES
TREASURER
STATE OF CALIFORNIA
INVESTMENT DIVISION SELECTED INVESTMENT DATA
ANALYSIS OF THE POOLED MONEY INVESTMENT ACCOUNT PORTFOLIO
(000 OMITTED)
SEPTEMBER 30, 2000
PERCENTAGE
CHANGE FROM
TYPE OF SECURITY
AMOUNT
PERCENT
PRIOR MONTH
Government
Bills
$
2,696,971
6.31
+.23
Bonds
0
0.00
0.00
Notes
3,377,164
7.90
+.68
Strips
0
0.00
0.00
Total Government
$
6,074,135
14.21
+.91
Federal Agency Coupons
$
3,312,880
7.75
-.31
Certificates of Deposit
7,119,067
16.67
-2.68
Bank Notes
1,290,026
3.02
-.44
Bankers' Acceptances
$
36,707
0.08
-0.01
Repurchases
0
0.00
0.00
Federal Agency Discount Notes
9,020,524
21.11
+1.56
Time Deposits
4,037,440
9.45
+.07
GNMAs
1,231
0.00
0.00
Commercial Paper
8,274,752
19.37
+1.46
FHLMC
11,965
0.03
0.00
Corporate Bonds
2,498,854
5.86
-.12
Pooled Loans
2,550,821
5.97
-.62
GF Loans
0
0.00
0.00
Reversed Repurchases
(1,504,124)
-3.52
-.18
Total (All Types)
$
42,724,278
100.00
INVESTMENT ACTIVITY*
SEPTEMBER 2000
AUGUST 2000
NUMBER
AMOUNT
NUMBER
AMOUNT
Pooled Money
481 $
22,177,686
479
$ 21,813,975
Other
21
100,960
33
848,090
Time Deposits
136
1,729,190
129
1,371,700
Totals
638 $
24,007,836
641
$ 24,033,765
PMIA Monthly Average Effective Yield
6.502
6.505
Year to Date Yield Last Day of Month
6.483
6.474
2
Pooled Money Investment Account
Portfolio Composition
$42.7 Billion
Corporate
Bonds
5.86% ,t
Commercial
Paper
Bankers
Acceptances
0.08%
Reverses
Loans -3.52%
5.97%
CD's/BN's
19.69%
Treasuries
14.21 %
3
Time Deposits
k 9.45%
Mortgages
0.03%
Agencies
28.86%
9/30/00
8 Treasuries
8 Time Deposits
■ Mortgages
Agencies
® C D's/B N's
0 Bankers Acceptances
■ Repo
0 Commercial Paper
® Corporate Bonds
❑ Loans
0 Reverses
09/01/00 REDEMPTIONS
CD
Wachovia
6.510%
09/01/00
6.490
$50,000
16
$144,223.50
6.580
CD
Wachovia
6.510%
09/01/00
6.490
50,000
16
144,223.50
6.580
CD
Zions
6.500%
09/01/00
6.490
50,000
23
207,320.76
6.580
CD
Zions
6.500%
09/01/00
6.490
50,000
23
207,320.76
6.580
CD
Barclays
6.540%
09/01/00
6.530
50,000
43
389,990.73
6.620
CD
Barclays
6.540%
09/01/00
6.530
50,000
43
389,990.73
6.620
CD
Den Danske
6.540%
09/01/00
6.530
50,000
46
417,199.73
6.620
CD
Den Danske
6.540%
09/01/00
6.530
50,000
46
417,199.73
6.620
CD
Nat W.Mstr
6.610%
09/01/00
6.590
50,000
60
549,184.77
6.681
CD
Nat W.Mstr
6.610%
09/01/00
6.590
50,000
60
549,184.77
6.681
CD
Cr Agric
6.470%
09/01/00
6.470
50,000
126
1,132,250.00
6.559
CD
Cr Agric
6.470%
09/01/00
6.470
50,000
126
1,132,250.00
6.559
CP
Household
09/01/00
6.530
50,000
2
18,138.89
6.623
CP
Household
09/01/00
6.530
50,000
2
18,138.89
6.623
CP
Household
09/01/00
6.530
50,000
2
18,138.89
6.623
CP
Household
09/01/00
6.530
50,000
2
18,138.89
6.623
CP
Hertz
09/01/00
6.460
25,000
8
35,888.89
6.559
CP
GMAC
09/01/00
6.430
50,000
8
71,444.44
6.528
CP
GMAC
09/01/00
6.430
50,000
8
71,444.44
6.528
CP
Amer Exp
09/01/00
6.430
50,000
8
71,444.44
6.528
CP
Amer Exp
09/01 /00
6.430
50,000
8
71,444.44
6.528
CP
FMCC
09/01/00
6.450
50,000
10
89,583.33
6.551
CP
FMCC
09/01/00
6.450
50,000
10
89,583.33
6.551
CP
Assoc
09/01/00
6.440
50,000
11
98,388.89
6.542
CP
Assoc
09/01/00
6.440
50,000
11
98,388.89
6.542
CP
GMAC
09/01/00
6.440
5,000
11
9,838.89
6.542
CP
GMAC
09/01/00
6.440
50,000
11
98,388.89
6.542
CP
GMAC
09/01/00
6.440
50,000
11
98,388.89
6.542
CP
GMAC
09/01/00
6.440
50,000
11
98,388.89
6.542
CP
SRAC
09/01/00
6.580
50,000
14
127,944.44
6.688
CP
GMAC
09/01/00
6.490
15,000
35
94,645.83
6.621
CP
GMAC
09/01/00
6.490
50,000
35
315,486.11
6.621
CP
GMAC
09/01100
6.490
50,000
35
315,486.11
6.621
CP
FMCC
09/01/00
6.470
50,000
35
314,513.89
6.601
CP
FMCC
09/01/00
6.470
50,000
35
314,513.89
6.601
CP
Morg Stan
09/01/00
6.490
50,000
43
387,597.22
6.631
CP
Morg Stan
09/01/00
6.490
50,000
43
387,597.22
6.631
CP
GMAC
09/01/00
6.490
50,000
44
396,611.11
6.632
CID
GMAC
09/01/00
6.490
50,000
44
396,611.11
6.632
CP
Morg Stan
09/01/00
6.490
50,000
52
468,722.22
6.642
CP
Morg Stan
09/01/00
6.490
50,000
52
468,722.22
6.642
CP
Heller
09/01/00
6.750
30,000
73
410,625.00
6.938
Disc Notes
FNMA
09/01/00
6.380
50,000
44
389,888.89
6.519
Disc Notes
FNMA
09/01/00
6.380
50,000
44
389,888.89
6.519
4
09/01/00 RRP
Treas
Bills
03/01/01
Treas
Bills
03/01/01
Treas
Bills
03/01/01
Treas
Bills
03/01/01
Treas
Bills
03/01/01
Treas
Bills
03/01/01
Treas
Bills
03/01/01
Treas
Bills
03/01/01
Treas
Bills
03/01/01
Treas
Bills
03/01/01
Treas
Bills
05/31/01
Treas
Bills
05/31/01
Treas
Bills
05/31/01
Treas
Bills
05/31/01
Treas
Bills
05/31/01
Treas
Bills
05/31/01
Treas
Bills
05/31/01
Treas
Bills
05/31/01
09/05/00 REDEMPTIONS
CD
Den Danske
6.525%
09/05/00
CD
Den Danske
6.525%
09/05/00
CD
Cr Agric
6.470%
09/05/00
CD
Cr Agric
6.470%
09/05/00
RRP
Treas
Bills
05/31/01
Treas
Bills
05/31/01
09/06/00 RRS
Treas
Bills
05/31/01
Treas
Bills
05/31/01
PURCHASES g/
Disc Notes
FHLMC
11/30/00
Disc Notes
FHLMC
11 /30/00
PURCHASES
CID
GECC
09/07/00
CID
GECC
09/07/00
CID
SRAC
09/12/00
F1
5.160
50,000
16
(110,882.67)
-5.231
5.160
50,000
16
(110,882.67)
-5.231
5.350
50,000
44
(315,317.48)
-5.424
5.350
50,000
44
(315,317.48)
-5.424
5.350
50,000
44
(315,337.92)
-5.424
5.350
50,000
44
(315,337.92)
-5.424
5.350
50,000
46
(329,415.10)
-5.424
5.350
50,000
46
(329,415.10)
-5.424
5.390
50,000
60
(432,322.92)
-5.464
5.390
50,000
60
(432,322.92)
-5.464
6.100
50,000
23
(185,605.21)
-6.184
6.100
50,000
23
(185,605.21)
-6.184
5.790
50,000
43
(328,156.29)
-5.870
5.790
50,000
43
(328,156.29)
-5.870
5.800
50,000
43
(328,030.28)
-5.880
5.800
50,000
43
(328,030.28)
-5.880
5.800
50,000
52
(396,268.89)
-5.880
5.800
50,000
52
(396,268.89)
-5.880
6.510
50,000
41
370,714.62
6.600
6.510
50,000
41
370,714.62
6.600
6.470
50,000
130
1,168,194.44
6.559
6.470
50,000
130
1,168,194.44
6.559
5.900 50,000 41 (319,341.60) -5.981
5.900 50,000 41 (319,341.60) -5.981
6.240 . 50,000
6.240 50,000
6.395 50,000
6.395 50,000
6.600 50,000
6.600 50,000
6.580 50,000
09/07/00 RRS
Treas
Bills
05/31/01
Treas
Bills
05/31/01
Treas
Bills
08/30/01
Treas
Bills
08/30/01
REDEMPTIONS
CD
CommerzBk
6.560% 09/07/00
CD
CommerzBk
6.560% 09/07/00
CP
GECC
09/07/00
CP
GECC
09/07/00
CP
SRAC
09/07/00
CP
ConAgra
09/07/00
CP
ConAgra
09/07/00
CP
ConAgra
09/07/00
CP
ConAgra
09/07/00
CP
ConAgra
09/07/00
CP
Morg Stan
09/07/00
CP
Morg Stan
09/07/00
RRP
Treas
Bills
05/31/01
Treas
Bills
05/31/01
Treas
Bills
05/31 /00
Treas
Bills
05/31 /00
PURCHASES g/
CP
GMAC
11/30/00
CP
GMAC
11/30/00
Disc Notes
FHLMC
11/30/00
Disc Notes
FHLMC
11/30/00
PURCHASES
CP
Amer Exp
09/08/00
CP
Dow
09/08/00
CP
Xerox
09/11 /00
CP
Xerox
09/11 /00
PURCHASES .Q/
Treas
Bills
03/08/01
Treas
Bills
03/08/01
Treas
Bills
03/08/01
C:
6.240
50,000
6.240
50,000
6.220
50,000
6.220
50,000
6.550
50,000
41
372,990.33
6.640
6.550
50,000
41
372,990.33
6.640
6.600
50,000
1
9,166.67
6.692
6.600
50,000
1
9,166.67
6.692
6.700
50,000
7
65,138.89
6.801
6.700
15,500
8
23,077.78
6.803
6.670
23,000
16
68,182.22
6.782
6.670
50,000
16
148,222.22
6.782
6.660
50,000
17
157,250.00
6.773
6.660
50,000
17
157,250.00
6.773
6.480
50,000
41
369,000.00
6.618
6.480
50,000
41
369,000.00
6.618
5.930
50,000 41
(320,796.53)
-6.012
5.930
50,000 41
(320,796.53)
-6.012
5.950
50,000 41
(322,217.29)
-6.032
5.950
50,000 41
(322,217.29)
-6.032
6.450
50,000
6.450
50,000
6.395
50,000
6.395
50,000
6.480
36,000
6.510
49,600
6.910
50,000
6.910
50,000
6.500 5,275
6.500 50,000
6.500 50,000
09/08/00 RRS
Treas
Notes
4.625%
11/30/00
6.180
50,000
Treas
Notes
4.625%
11/30/00
6.180
50,000
REDEMPTIONS
CD
Stnrd Ch
6.620%
09/08/00
6.620
50,000
64
588,444.44
6.711
CD
Stnrd Ch
6.620%
09/08/00
6.620
50,000
64
588,444.44
6.711
CP
Amer Exp
09/08/00
6.480
36,000
1
6,480.00
6.571
CP
Dow
09/08/00
6.510
49,600
1
8,969.33
6.601
SALES S/
Treas
Bills
03/08/01
6.500
5,275
1
904.58
6.590
Treas
Bills
03/08/01
6.500
50,000
1
8,575.49
6.590
Treas
Bills
03/08/01
6.500
50,000
1
8,575.49
6.590
PURCHASES g/
CP
CAFCO
11/30/00
6.480
50,000
CP
CAFCO
11/30/00
6.480
50,000
PURCHASES
CP
Assoc
09/11/00
6.480
10,000
CP
Disney
09/11/00
6.460
40,950
CP
Dow
09/11/00
6.450
50,000
CP
Dow
09/11/00
6.450
50,000
CP
Assoc
09/11/00
6.480
50,000
09/11/00 RRS
Treas
Bills
05/31 /01
6.150
50,000
Treas
Bills
05/31 /01
6.150
50,000
REDEMPTIONS
CP
Assoc
09/11/00
6.480
10,000
3
5,400.00
6.573
CP
Disney
09/11/00
6.460
40,950
3
22,044.75
6.553
CP
Dow
09/11/00
6.450
50,000
3
26,875.00
6.543
CP
Dow
09/11/00
6.450
50,000
3
26,875.00
6.543
CP
Assoc
09/11/00
6.480
50,000
3
27,000.00
6.573
CP
Xerox
09/11/00
6.910
50,000
4
38,388.89
7.011
CP
Xerox
09/11/00
6.910
50,000
4
38,388.89
7.011
CP
ConAgra
09/11/00
6.620
20,000
28
102,977.78
6.746
CP
ConAgra
09/11/00
6.680
20,000
39
144,733.33
6.822
CP
Bear
09/11/00
6.640
50,000
101
931,444.44
6.860
7
09/11/00 REDEMPTIONS (continued)
CP
Bear
CP
Bear
Disc Notes
FNMA
Disc Notes
FNMA
PURCHASES g/
CP
GECC
CP
GECC
PURCHASES
CP
GECC
CP
GECC
CP
GECC
CP
Household
CP
Household
CP
Heller
CP
SRAC
CP
SRAC
09/12/00 REDEMPTIONS
CP
GECC
CP
GECC
CP
GECC
CP
Household
CP
Household
CP
SRAC
CP
GMAC
CP
GMAC
CP
ConAgra,
PURCHASES
CP
Amer Exp
CP
Amer Exp
CP
SRAC
CP
GECC
CP
GECC
CP
Heller
09/13/00 RRS
Treas
Bills
Treas
Bills
09/11 /00
6.640
50,000
101
931,444.44
6.860
09/11 /00
6.640
50,000
101
931,444.44
6.860
09/11 /00
5.600
50,000
277
2,154,444.44
5.933
09/11 /00
5.600
50,000
277
2,154,444.44
5.933
11 /30/00 6.450 50,000
11/30/00 6.450 50,000
09/12/00
6.500
50,000
09/12/00
6.500
50,000
09/12/00
6.500
50,000
09/12/00
6.500
50,000
09/12/00
6.500
50,000
09/22/00
6.600
50,000
09/27/00
6.630
50,000
09/27/00
6.630
50,000
09/12/00
6.500
50,000
1
9,027.78
6.591
09/12/00
6.500
50,000
1
9,027.78
6.591
09/12/00.
6.500
50,000
1
9,027.78
6.591
09/12/00
6.500
50,000
1
9,027.78
6.591
09/12/00
6.500
50,000
1
9,027.78
6.591
09/12/00
6.580
50,000
6
54,833.33
6.678
09/12/00
6.520
50,000
12
108,666.67
6.624
09/12/00
6.520
50,000
12
108,666.67
6.624
09/12/00
6.680
35,000
14
90,922.22
6.790
10/03/00
6.490
50,000
10/03/00
6.490
50,000
10/05/00
6.630
50,000
10/06/00
6.490
50,000
10/06/00
6.490
50,000
10/13/00
6.620
50,000
12/07/00 6.050 50,000
12/07/00 6.050 50,000
8
09/13/00 RRS (continued)
Treas
Notes
4.625%
11/30/00
6.080
50,000
Treas
Notes
4.625%
11/30/00
6.080
50,000
PURCHASES g(
CD
Stnrd Ch
6.580%
12/07/00
6.570
50,000
CD
Stnrd Ch
6.580%
12/07/00
6.570
50,000
CID
GECC
11/30/00
6.450
50,000
CID
GECC
11/30/00
6.450
50,000
PURCHASES
CID
GMAC
10/02/00
6.460
2,000
CID
GMAC
10/02/00
6.460
50,000
CID
GMAC
10/02/00
6.460
50,000
09/14/00 RRS
FNMA 5.625% 03/15/01 6.240 30,000
REDEMPTIONS
CID Amer Exp 09/14/00 6.500 30,000 14 75,833.33
MTN GMAC 5.400% 09/14/00 5.400 25,000 724 2,672,750.00
RRP
FNMA
PURCHASES g/
CID
Amer Exp
PURCHASES
CID
Bear
CID
Bear
CID
Bear
CID
NCAT
CID
Enron
CP
NCAT
CID
SRAC
09/15/00 RRS
Treas
Bills
5.625% 03/15/01 6.250 30,000
10/05/00 6.470 30,000
10/05/00
6.500
35,000
10/05/00
6.500
50,000
10/05/00
6.500
50,000
10/16/00
6.510
20,000
10/16/00
6.620
35,000
10/16/00
6.510
50,000
10/16/00
6.720
50,000
12/07/00 6.085 50,000
9
6.606
5.404
14 (74,375.00) -6.336
09/15/00 RRS (continued)
Treas Bills 12/07/00 6.085 50,000
PURCHASES y/
CP
GECC
12/07/00
6.450
50,000
CP
GECC
12/07/00
6.450
50,000
PURCHASES
BN
B/A
6.650%
01/29/01
6.650
50,000
BN
B/A
6.650%
01/29/01
6.650
50,000
CP
Household
09/22/00
6.520
50,000
CP
Household
09/22/00
6.520
50,000
CP
GMAC
09/26/00
6.520
50,000
CP
GMAC
09/26/00
6.520
50,000
CP
GMAC
09/27/00
6.520
50,000
CP
GMAC
09/27/00
6.520
50,000
CP
GMAC
09/28/00
6.520
50,000
CP
GMAC
09/28/00
6.520
50,000
CP
Enterprise
10/02/00
6.520
9,217
CP
Enron
10/02/00
6.620
45,000
CP
Enterprise
10/02/00
6.520
50,000
CP
Enron
10/02/00
6.620
50,000
CP
CAFCO
10/16/00
6.500
25,000
CP
Rohm
10/16/00
6.650
25,144
CP
CAFCO
10/16/00
6.500
50,000
CP
Assoc
01/26/01
6.520
50,000
CP
Assoc
01/26/02
6.520
50,000
09/18/00 NO SALES
PURCHASES
BN
B/A
6.660%
01/29/01
6.660
50,000
BN
B/A
6.660%
01/29/01
6.660
50,000
CD
Cr Agric
6.640%
01/29/01
6.640
50,000
CD
Cr Agric
6.640%
01/29/01
6.640
50,000
CD
Austria
6.650%
01/29/01
6.640
50,000
CD
Austria
6.650%
01/29/01
6.640
50,000
CD
BNParis
6.640%
01/29/01
6.640
50,000
CD
BNParis
6.640%
01/29/01
6.640
50,000
CP
FMCC
10/02/00
6.500
50,000
CP
FMCC
10/02/00
6.500
50,000
CP
Enron
10/02/00
6.620
50,000
CP
Heller
10/24/00
6.600
50,000
10
09/19/00 RRS
Treas
Bills
12/07/00
6.070
50,000
Treas
Bills
12/07/00
6.070
50,000
PURCHASES g/
CD
Den Danske
6.530%
12/07/00
6.530
50,000
CD
Den Danske
6.530%
12/07/00
6.530
50,000
PURCHASES
CP
GMAC
09/27/00
6.470
20,000
CP
GMAC
09/27/00
6.470
50,000
CP
GMAC
09/27/00
6.470
50,000
CP
GECC
09/27/00
6.450
50,000
CP
GECC
09/27/00
6.450
50,000
CP
GECC
09/27/00
6.450
50,000
CP
GECC
09/27/00
6.450
50,000
CP
GMAC
09/28/00
6.470
50,000
CP
GMAC
09/28/00
6.470
50,000
Disc Notes
FHLMC
09/13/01
6.160
22,423
09/20/00 NO SALES
PURCHASES
CD
Montreal
6.550%
12/01 /00
6.550
50,000
CD
Montreal
6.550%
12/01 /00
6.550
50,000
CD
ANZ
6.610%
02/28/01
6.610
50,000
CD
ANZ
6.610%
02/28/01
6.610
50,000
CD
Bayer Lnds
6.610%
02/28/01
6.610
50,000
CD
Bayer Lnds
6.610%
02/28/01
6.610
50,000
CD
BNParis
6.610%
02/28/01
6.610
50,000
CD
BNParis
6.610%
02/28/01
6.610
50,000
CP
GECC
09/21/00
6.390
50,000
CP
GECC
09/21/00
6.390
50,000
CP
GECC
09/21/00
6.390
50,000
CP
GECC
09/21/00
6.390
50,000
CP
Household
09/22/00
6.420
5,000
CP
Household
09/22/00
6.420
50,000
CP
Household
09/22/00
6.420
50,000
CP
Household
09/22/00
6.420
50,000
CP
Household
09/22/00
6.420
50,000
CP
GMAC
10/02/00
6.450
50,000
CP
GMAC
10/02/00
6.450
50,000
CP
Hewlett
10/02/00
6.470
50,000
CP
Salomon
12/01 /00
6.480
50,000
11
09/20/00 PURCHASES (continued)
CID
Salomon
CID
Salomon
09/21 /00 RRS
Treas
Bills
Treas
Bills
Treas
Notes
Treas
Notes
REDEMPTIONS
CID
GECC
CID
GECC
CID
GECC
CID
GECC
PURCHASES g/
CID
Salomon
CID
Salomon
CID
Salomon
CID
Salomon
PURCHASES
CID
Rohm
CID
Assoc
CID
Assoc
CID
GECC
CID
GECC
CID
ConAgra
Disc Notes
FNMA
Disc Notes
FNMA
Disc Notes
FNMA
Disc Notes
FNMA
Disc Notes
FNMA
Disc Notes
FNMA
Disc Notes
FNMA
Disc Notes
FNMA
Disc Notes
FNMA
Disc Notes
FNMA
Disc Notes
FNMA
Treas
Bills
Treas
Bills
Treas
Bills
12/01/00 6.480 50,000
12/01 /00 6.480 50,000
12/07/00
6.100
50,000
12/07/00
6.100
50,000
4.625% 11/30/00
6.125
50,000
4.625% 11/30/00
6.125
50,000
09/21 /00
6.390
50,000 1
8,875.00
6.479
09/21 /00
6.390
50,000 1
8,875.00
6.479
09/21 /00
6.390
50,000 1
8,875.00
6.479
09/21/00
6.390
50,000 1
8,875.00
6.479
11/30/00
6.470
50,000
11/30/00
6.470
50,000
12/07/00
6.470
50,000
12/07/00
6.470
50,000
09/22/00
6.560
40,000
09/22/00
6.450
50,000
09/22/00
6.450
50,000
09/22/00
6.450
50,000
09/22/00
6.450
50,000
10/16/00
6.650
39,000
05/29/01
6.240
50,000
05/29/01
6.240
50,000
06/18/01
6.220
50,000
06/18/01
6.220
50,000
06/22/01
6.220
25,000
06/22/01
6.220
50,000
06/22/01
6.220
50,000
07/09/01
6.175
50,000
07/09/01
6.175
50,000
07/16/01
6.175
25,000
09/14/01
6.160
50,000
08/30/01
5.760
50,000
08/30/01
5.760
50,000
08/30/01
5.760
50,000
12
09/21/00 PURCHASES (continued)
Treas
Bills
08/30/01
5.760
50,000
Treas
Notes
6.125%
08/31/02
6.096
50,000
Treas
Notes
6.125%
08/31 /02
6.096
50,000
Treas
Notes
6.125%
08/31 /02
6.100
50,000
Treas
Notes
6.125%
08/31 /02
6.100
50,000
Treas
Notes
6.125%
08/31 /02
6.100
50,000
Treas
Notes
6.125%
08/31 /02
6.100
50,000
Treas
Notes
5.750%
08/15/03
6.033
50,000
Treas
Notes
5.750%
08/15/03
6.033
50,000
FHLB
6.500%
09/19/01
6.567
50,000
FHLB
6.500%
09/19/01
6.567
50,000
09/22/00 REDEMPTIONS
CP
Rohm
09/22/00
6.560
40,000
1
7,288.89
6.652
CP
GECC
09/22/00
6.450
50,000
1
8,958.33
6.540
CP
GECC
09/22/00
6.450
50,000
1
8,958.33
6.540
CP
Assoc
09/22/00
6.450
50,000
1
8,958.33
6.540
CP
Assoc
09/22/00
6.450
50,000
1
8,958.33
6.540
CP
Household
09/22/00
6.420
5,000
2
1,783.33
6.511
CP
Household
09/22/00
6.420
50,000
2
17,833.33
6.511
CP
Household
09/22/00
6.420
50,000
2
17,833.33
6.511
CP
Household
09/22/00
6.420
50,000
2
17,833.33
6.511
CP
Household
09/22/00
6.420
50,000
2
17,833.33
6.511
CP
Household
09/22/00
6.520
50,000
7
63,388.89
6.618
CP
Household
09/22/00
6.520
50,000
7
63,388.89
6.618
CP
Heller
09/22/00
6.600
50,000
11
100,833.33
6.705
FNMA
4.980% 09/22/00
5.092
15,250
731
1,550,925.00
5.099
FNMA
4.980% 09/22/00
5.092
50,000
731
5,085,000.00
5.099
FNMA
4.980% 09/22/00
5.100
50,000
731
5,092,500.00
5.107
PURCHASES
CB
B/A
7.750% 07/15/02
6.715
8,732
CP
JP Morgan
09/25/00
6.450
50,000
CP
JP Morgan
09/25/00
6.450
50,000
Disc Notes
FHLMC
09/13/01
6.145
5,000
Disc Notes
FHLMC
09/13/01
6.135
25,000
Disc Notes
FHLMC
09/13/01
6.135
50,000
Disc Notes
FHLMC
09/13/01
6.140
50,000
Disc Notes
FHLMC
09/13/01
6.145
50,000
Disc Notes
FNMA
09/06/01
6.160
38,000
Disc Notes
FNMA
09/12/01
6.120
25,000
Disc Notes
FNMA
09/12/01
6.120
50,000
Disc Notes
FNMA
09/12/01
6.120
50,000
Disc Notes
FNMA
09/12/01
6.120
50,000
13
09/25/00 REDEMPTIONS
CP JP Morgan
CP JP Morgan
PURCHASES
CP
SRAC
CP
GMAC
CP
GMAC
CP
Household
CP
Household
CP
Amer Exp
CP
Amer Exp
CP
Amer Exp
CP
Amer Exp
CP
Hertz
CP
GMAC
CP
GMAC
CP
JC Penney
MTN FR
B/A
MTN
Citicorp
09/26/00 RRS
Treas Bills
REDEMPTIONS
CP
SRAC
CP
GMAC
CP
GMAC
CP
Household
CP
Household
CP
GMAC
CP
GMAC
PURCHASES
. /
CP
AT&T
PURCHASES
BN
Banc One
CP
Assoc
CP
Assoc
CP
Assoc
CP
Assoc
09/25/00 6.450 50,000 3 26,875.00 6.543
09/25/00 6.450 50,000 3 26,875.00 6.543
09/26/00
6.670
20,000
09/26/00
6.500
50,000
09/26/00
6.500
50,000
09/26/00
6.500
50,000
09/26/00
6.500
50,000
10/02/00
6.510
50,000
10/02/00
6.510
50,000
10/03/00
6.510
50,000
10/03/00
6.510
50,000
10/13/00
6.510
50,000
10/13/00
6.510
50,000
10/13/00
6.510
50,000
10/27/00
6.850
35,700
6.720% 06/24/02
6.660
25,000
8.000% 02/01 /03
6.849
15,250
12/07/00 6.080 50,000
09/26/00
6.670
20,000
1
3,705.56
6.763
09/26/00
6.500
50,000
1
9,027.78
6.591
09/26/00
6.500
50,000
1
9,027.78
6.591
09/26/00
6.500
50,000
1
9,027.78
6.591
09/26/00
6.500
50,000
1
9,027.78
6.591
09/26/00
6.520
50,000
11
99,611.11
6.623
09/26/00
6.520
50,000
11
99,611.11
6.623
12/07/00 6.460 50,000
6.660% 03/28/01
6.660
50,000
09/27/00
6.500
50,000
09/27/00
6.500
50,000
09/27/00
6.500
50,000
09/27/00
6.500
50,000
14
09/26/00 PURCHASES (continued)
CP
GECC
09/27/00
6.500
50,000
CP
GECC
09/27/00
6.500
50,000
CP
GECC
09/27/00
6.500
50,000
CP
GECC
09/27/00
6.500
50,000
CP
Amer Exp
10/02/00
6.530
50,000
CP
Amer Exp
10/02/00
6.530
50,000
CP
SRAC
10/05/00
6.800
20,000
CP
FMCC
10/10/00
6.520
50,000
CP
FMCC
10/10/00
6.520
50,000
CP
FMCC
10/11/00
6.520
50,000
CP
FMCC
10/11/00
6.520
50,000
CP
GECC
03/23/01
6.410
50,000
CP
GECC
03/23/01
6.410
50,000
Disc Notes
FNMA
09/21/01
6.150
50,000
Disc Notes
FNMA
09/21/01
6.150
50,000
MTN
Citicorp
8.625% 12/01/02
6.798
13,900
MTN
GMAC
6.750% 12/10/02
6.868
20,000
09/27/00 REDEMPTIONS
BN
B/A
6.420%
09/27/00
6.420
50,000
155
1,382,083.33
6.509
BN
B/A
6.420%
09/27/00
6.420
50,000
155
1,382,083.33
6.509
BN
B/A
6.420%
09/27/00
6.420
50,000
155
1,382,083.33
6.509
BN
B/A
6.360%
09/27/00
6.360
10,000
163
287,966.67
6.448
BN
B/A
6.360%
09/27/00
6.360
50,000
163
1,439,833.33
6.448
BN
B/A
6.370%
09/27/00
6.370
50,000
168
1,486,333.33
6.458
CD
Bayer Ver
6.380%
09/27/00
6.375
50,000
161
1,425,551.83
6.463
CD
Bayer Ver
6.380%
09/27/00
6.375
50,000
161
1,425,551.83
6.463
CD
US Bank
6.330%
09/27/00
6.330
50,000
163
1,433,041.67
6.417
CD
US Bank
6.330%
09/27/00
6.330
50,000
163
1,433,041.67
6.417
CD
ABN Amro
6.350%
09/27/00
6.340
50,000
163
1,435,368.74
6.428
CD
ABN Amro
6.350%
09/27/00
6.340
50,000
163
1,435,368.74
6.428
CD
Dresdner
6.350%
09/27/00
6.350
50,000
168
1,481,666.67
6.438
CD
Dresdner
6.350%
09/27/00
6.350
50,000
168
1,481,666.67
6.438
CD
U/B Calif
6.380%
09/27/00
6.380
6,000
170
180,766.67
6.468
CD
U/B Calif
6.380%
09/27/00
6.380
50,000
170
1,506,388.89
6.468
CD
U/B Calif
6.380%
09/27/00
6.380
50,000
170
1,506,388.89
6.468
CD
Soc Gen
6.140%
09/27/00
6.140
50,000
273
2,328,083.33
6.225
CD
Soc Gen
6.140%
09/27/00
6.140
50,000
273
2,328,083.33
6.225
CP
Assoc
09/27/00
6.500
50,000
1
9,027.78
6.591
CP
Assoc
09/27/00
6.500
50,000
1
9,027.78
6.591
CP
Assoc
09/27/00
6.500
50,000
1
9,027.78
6.591
CP
Assoc
09/27/00
6.500
50,000
1
9,027.78
6.591
CP
GECC
09/27/00
6.500
50,000
1
9,027.78
6.591
CP
GECC
09/27/00
6.500
50,000
1
9,027.78
6.591
CP
GECC
09/27/00
6.500
50,000
1
9,027.78
6.591
15
09/27/00 REDEMPTIONS (continued)'
CP
GECC
09/27/00
6.500
50,000
1
9,027.78
6.591
CP
GECC
09/27/00
6.450
20,000
8
28,755.56
6.548
CP
GECC
09/27/00
6.450
50,000
8
71,666.67
6.548
CP
GECC
09/27/00
6.450
50,000
8
71,666.67
6.548
CP
GECC
09/27/00
6.450
50,000
8
71,666.67
6.548
CP
GECC
09/27/00
6.450
50,000
8
71,666.67
6.548
CP
GECC
09/27/00
6.450
50,000
8
71,666.67
6.548
CP
GECC
09/27/00
6.450
50,000
8
71,666.67
6.548
CP
GMAC
09/27/00
6.520
50,000
12
108,666.67
6.624
CP
GMAC
09/27/00
6.520
50,000
12
108,666.67
6.624
CP
SRAC
09/27/00
6.630
50,000
16
147,333.33
6.741
CP
Bear
09/27/00
6.720
50,000
118
1,101,333.33
6.966
CP
Bear
09/27/00
6.720
50,000
118
1,101,333.33
6.966
CP
B/A
09/27/00
6.720
50,000
118
1,101,333.33
6.966
CP
B/A
09/27/00
6.720
50,000
118
1,101,333.33
6.966
CP
GECC
09/27/00
6.230
50,000
155
1,341,180.56
6.490
CP
GECC
09/27/00
6.230
50,000
155
1,341,180.56
6.490
CP
GECC
09/27/00
6.230
50,000
155
1,341,180.56
6.490
CP
GECC
09/27/00
6.230
50,000
155
1,341,180.56
6.490
CP
GECC
09/27/00
6.180
50,000
163
1,399,083.33
6.446
CP
GECC
09/27/00
6.180
50,000
163
1,399,083.33
6.446
CP
GECC
09/27/00
6.180
50,000
163
1,399,083.33
6.446
CP
Merrill
09/27/00
6.220
50,000
166
1,434,055.55
6.492
CP
Merrill
09/27/00
6.220
50,000
166
1,434,055.55
6.492
CP
Merrill
09/27/00
6.220
50,000
166
1,434,055.55
6.492
PURCHASES
CP
Assoc
09/28/00
6.510
50,000
CP
Assoc
09/28/00
6.510
50,000
CP
Assoc
09/28/00
6.510
50,000
CP
Assoc
09/28/00
6.510
50,000
CP
Salomon
10/02/00
6.550
50,000
CP
Salomon
10/02/00
6.550
50,000
CP
Amer Exp
10/12/00
6.530
50,000
CP
Amer Exp
10/12/00
6.530
50,000
CP
Amer Exp
10/12/00
6.530
50,000
CP
Amer Exp
10/12/00
6.530
50,000
CP
SRAC
10/13/00
6.750
50,000
CP
Assoc
10/18/00
6.500
10,000
CP
Assoc
10/18/00
6.500
50,000
FR
SBA
7.125% 08/25/25
7.125
14,029
09/28/00 REDEMPTIONS
CP Assoc 09/28/00 6.510 50,000 1 9,041.67 6.601
iG
09/28/00 REDEMPTIONS (continued)
CP
Assoc
09/28/00
6.510
50,000
1
9,041.67
6.601
CP
Assoc
09/28/00
6.510
50,000
1
9,041.67
6.601
CP
Assoc
09/28/00
6.510
50,000
1
9,041.67
6.601
CP
GMAC
09/28/00
6.470
50,000
9
80,875.00
6.570
CP
GMAC
09/28/00
6.470
50,000
9
80,875.00
6:570
CP
GMAC
09/28/00
6.520
50,000
13
117,722.22
6.626
CP
GMAC
09/28/00
6.520
50,000
13
117,722.22
6.626
CP
SRAC
09/28/00
6.630
50,000
17
156,541.67
6.743
PURCHASES
CP
Assoc
09/29/00
6.550
25,000
CP
Assoc
09/29/00
6.550
50,000
CP
Assoc
09/29/00
6.550
50,000
CP
Assoc
09/29/00
6.550
50,000
CP
GECC
10/02/00
6.550
50,000
CP
GECC
10/02/00
6.550
50,000
CP
GECC
10/02/00
6.550
50,000
09/29/00 REDEMPTIONS
BN
Banc One
6.420%
09/29/00
6.420
50,000
157
1,399,916.67
6.509
BN
Banc One
6.420%
09/29/00
6.420
50,000
157
1,399,916.67
6.509
BN
Banc One
6.420%
09/29/00
6.420
50,000
157
1,399,916.67
6.509
CD
CIBC
6.350%
09/29/00
6.350
50,000
163
1,437,569.44
6.438
CD
Bayer Ver
6.380%
09/29/00
6.375
50,000
163
1,443,260.92
6.463
CD
Bayer Ver
6.380%
09/29/00
6.375
50,000
163
1,443,260.92
6.463
CP
Assoc
09/29/00
6.550
50,000
1
9,097.22
6.642
CP
Assoc
09/29/00
6.550
50,000
1
9,097.22
6.642
CP
Assoc
09/29/00
6.550
50,000
1
9,097.22
6.642
CP
Assoc
09/29/00
6.550
50,000
1
9,097.22
6.642
CP
Assoc
09/29/00
6.560
50,000
106
965,777.78
6.782
CP
Assoc
09/29/00
6.560
50,000
106
965,777.78
6.782
CP
GECC
09/29/00
6.230
50,000
157
1,358,486.11
6.492
CP
GECC
09/29/00
6.230
50,000
157
1,358,486.11
6.492
CP
GECC
09/29/00
6.230
50,000
157
1,358,486.11
6.492
CP
GECC
09/29/00
6.230
50,000
157
1,358,486.11
6.492
PURCHASES
CP
GECC
10/02/00
6.690
50,000
CP
GECC
10/02/00
6.690
50,000
CP
GECC
10/02/00
6.690
50,000
CP
GECC
10/02/00
6.690
50,000
CP
NCAT
10/02/00
6.720
50,000
17
a/ The abbreviations indicate the type of security purchased or sold;
i.e., (U.S.) Bills, Bonds, Notes, Debentures, Discount Notes,
and Participation Certificates: Federal National Mortgage Association
(FNMA), Farmers Home Administration Notes (FHA), Student Loan
Marketing Association (SLMA), Small Business Association (SBA),
Negotiable Certificates of Deposit (CD), Negotiable Certificates of
Deposit Floating Rate (CD FR), Export Import Notes (EXIM),
Bankers Acceptances (BA), Commercial Paper (CP), Government
National Mortgage Association (GNMA), Federal Home Loan Bank
Notes (FHLB), Federal Land Bank Bonds (FLB), Federal Home Loan
Mortgage Corporation Obligation (FHLMC PC) & (FHLMC GMC),
Federal Farm Credit Bank Bonds (FFCB),,Federal Farm Credit Discount
Notes (FFC), Corporate Securities (CB), U.S. Ship Financing Bonds
(TITLE XI'S), International Bank of Redevelopment (ORD), Tennessee
Valley Authority (TVA) Medium Term Notes (MTN).
b/ Purchase or sale yield based on 360 day calculation for discount
obligations and Repurchase Agreements.
c/ Repurchase Agreement.
d/ Par amount of securites purchased, sold, or redeemed.
e/ Securities were purchased and sold as of the same date.
f/ Repurchase Agreement against Reverse Repurchase Agreement.
g/ Outright purchase against Reverse Repurchase Agreement.
h/ Security "SWAP" transactions.
i/ Buy back agreement.
RRS Reverse Repurchase Agreement.
RIM Termination of Reverse Repurchase Agreement.
18
NAME
AGOURA HILLS
Pacific Crest Bank
Pacific Crest Bank
Pacific Crest Bank
Pacific Crest Bank
Pacific Crest Bank
Pacific Crest Bank
ALHAMBRA
Grand National Bank
Grand National Bank
Grand National Bank
Grand National Bank
Grand National Bank
Omni Bank
Omni Bank
Omni Bank
Omni Bank
ARROYO GRANDE
Mid -State Bank.
Mid -State Bank
Mid -State Bank
BEVERLY HILLS
City National Bank
City National Bank
City National Bank
City National Bank
City National Bank
North State National Bank
North State National Bank
North State National Bank
North State National Bank
North State National Bank
Tri Counties Bank
Tri Counties Bank
TIME DEPOSITS
DEPOSIT PAR MATURITY
DATE YIELD AMOUNT (s) DATE
07/06/00
6.030
8,000,000.00
10/04/00
10/12/99
5.390
5,000,000.00
10/16/00
07/17/00
6.220
5,000,000.00
10/16/00
11 /30/99
5.740
5,000,000.00
12/01 /00
12/28/99
5.980
5,000,000.00
12/27/00
08/31 /00
6.430
5,000,000.00
02/27/01
07/20/00
6.360
3,095,000.00
01 /16/01
08/07/00
6.330
3,000,000.00
02/16/01
09/06/00
6.300
3,000,000.00
05/31 /01
06/23/00
6.170
1,000,000.00
06/25/01
07/14/00
6.120
2,000,000.00
07/13/01
07/31 /00
6.230
300,000.00
10/30/00
07/24/00
6.140
1,000,000.00
10/30/00
08/30/00
6.340
2,000,000.00
11 /28/00
09/05/00
6.210
6,000,000.00
12/04/00
07/17/00
6.270
5,000,000.00
10/16/00
07/17/00
6.270
5,000,000.00
01 /12/01
09/19/00
6.230
5,000,000.00
03/19/01
10/12/99
5.360
25,000,000.00
10/16/00
05/03/00
6.170
25,000,000.00
10/31/00
02/28/00
6.220
20,000,000.00
02/28/01
09/15/00
6.200
20,000,000.00
03/16/01
09/29/00
6.220
50,000,000.00
06/05/01
07/07/00
6.220
3,000,000.00
01 /05/01
08/24/99
6.380
1,000,000.00
02/23/01
09/01 /00
6.410
1,500,000.00
03/02/01
04/06/00
6.170
1,000,000.00
04/06/01
04/07/00
6.170
1,000,000.00
04/06/01
07/10/00
6.050
10,000,000.00
10/10/00
09/06/00
6.280
10,000,000.00
12/05/00
19
TIME DEPOSITS
DEPOSIT
PAR
MATURITY
NAME
DATE
YIELD
AMOUNT (S)
DATE
CHICO (continued)
Tri Counties Bank
09/12/00
6.190
10,000,000.00
12/12/00
Tri Counties Bank
09/19/00
6.180
10,000,000.00
12/19/00
CHULA VISTA
North Island FCU
09/15/00
6.170
20,000,000.00
12/15/00
North Island FCU
09/15/00
6.240
20,000,000.00
03/14/01
CITY OF INDUSTRY
EverTrust Bank
01/20/00
6.050
3,000,000.00
10/16/00
EverTrust Bank
09/11/00
6.170
4,000,000.00
12/11/00
EverTrust Bank
09/25/00
6.170
2,000,000.00
12/21/00
EverTrust Bank
07/18/00
6.110
3,000,000.00
07/18/01
CONCORD
CA State 9 Credit Union
08/24/00
6.330
10,000,000.00
11/21/00
DUBLIN
Operating Engineers FCU
06/02/00
6.290
5,000,000.00
11/30/00
Operating Engineers FCU
09/19/00
6.180
10,000,000.00
12/19/00
Operating Engineers FCU
08/22/00
6.350
10,000,000.00
02/20/01
EL CENTRO
Valley Independent Bank
05/02/00
6.140
15,000,000.00
10/31/00
Valley Independent Bank
07/31/00
6.330
5,000,000.00
01/29/01
Valley Independent Bank
08/11/00
6.340
3,750,000.00
02/15/01
Valley Independent Bank
05/15/00
6.410
3,750,000.00
05/15/01
EL SEGUNDO
Xerox Federal Credit Union
08/15/00
6.320
5,000,000.00
11/14/00
Xerox Federal Credit Union
09/06/00
6.290
7,000,000.00
12/05/00
Xerox Federal Credit Union
08/15/00
6.380
15,000,000.00
02/13/01
FR_
United Security Bank
07/31/00
6.240
15,000,000.00
11/01/00
United Security Bank
08/15/00
6.310
10,000,000.00
11/15/00
20
TIME DEPOSITS
DEPOSIT
PAR
MATURITY
NAME
DATE YIELD
AMOUNT (s)
DATE
FULLERTON
Fullerton Community Bank
08/21/00 6.300
9,000,000.00
11/21/00
Fullerton Community Bank
01 /19/00 6.160
8,000,000.00
01 /19/01
INGLEWOOD
Imperial Bank
04/13/00
6.100
20,000,000.00
10/05/00
Imperial Bank
03/09/00
6.190
25,000,000.00
10/12/00
Imperial Bank
05/18/00
6.420
25,000,000.00
10/19/00
Imperial Bank
06/13/00
6.140
15,000,000.00
11/02/00
Imperial Bank
03/30/00
6.320
18,000,000.00
11/09/00
Imperial Bank
05/25/00
6.460
25,000,000.00
11/16/00
Imperial Bank
04/27/00
6.150
26,000,000.00
12/07/00
Imperial Bank
07/06/00
6.260
25,000,000.00
02/01/01
Imperial Bank
09/14/00
6.180
75,000,000.00
02/22/01
Imperial Bank
06/22/00
6.010
20,000,000.00
03/01/01
Imperial Bank
08/10/00
6.210
18,000,000.00
03/08/01
Imperial Bank
08/17/00
6.240
25,000,000.00
03/08/01
LAGUNA HILLS
ElDorado Bank
07/25/00
6.190
20,000,000.00
10/23/00
ElDorado Bank
08/22/00
6.320
20,000,000.00
11/20/00
ElDorado Bank
12/14/00
6.190
25,000,000.00
12/14/00
LODI
Farmers & Merchant Bk Cen CA
07/06/00
6.000
10,000,000.00
10/04/00
LOS ANGELES
Broadway Federal Bank
09/29/99
5.230
2,500,000.00
10/02/00
Broadway Federal Bank
06/30/00
6.250
1,250,000.00
01 /08/01
Broadway Federal Bank
07/07/00
6.230
1,250,000.00
01/08/01
California Chohung Bank
07/19/00
6.320
1,000,000.00
01/17/01
Cathay Bank
09/19/00
6.180
9,000,000.00
12/18/00
Cathay Bank
09/26/00
6.200
10,000,000.00
12/27/00
Eastern International Bank
05/09/00
6.380
900,000.00
11/06/00
General Bank
07/24/00
6.210
7,000,000.00
10/23/00
General Bank
08/01/00
6.230
28,000,000.00
11/01/00
General Bank
08/08/00
6.270
15,000,000.00
11/06/00
General Bank
08/02/00
6.270
15,000,000.00
11/06/00
General Bank
08/30/00
6.330
10,000,000.00
11/28/00
21
TIME DEPOSITS
DEPOSIT PAR MATURITY
NAME DATE YIELD AMOUNT (s) DATE
LOS ANGELES (continued)
General Bank
09/08/00
6.230
25,000,000.00
12/08/00
Hanmi Bank
06/27/00
6.210
25,000,000.00
01/02/01
Manufacturers Bank
08/07/00
6.250
10,000,000.00
11 /06/00
Manufacturers Bank
09/05/00
6.300
10,000,000.00
12/04/00
Manufacturers Bank
09/25/00
6.200
10,000,000.00
12/21/00
Manufacturers Bank
09/11/00
6.290
10,000,000.00
03/12/01
Mercantile National Bank
08/17/00
6.400
2,000,000.00
02/13/01
Preferred Bank
07/03/00
5.860
3,000,000.00
10/02/00
Preferred Bank
07/17/00
6.180
3,000,000.00
10/16/00
Preferred Bank
08/14/00
6.280
4,000,000.00
11/14/00
Preferred Bank
08/30/00
6.320
7,000,000.00
11 /28/00
Preferred Bank
09/11/00
6.180
9,000,000.00
12/11/00
Preferred Bank
09/18/00
6.160
9,000,000.00
12/18/00
Sae Han Bank
04/20/00
6.040
3,000,000.00
10/17/00
State Bank of India
11/19/99
5.600
2,000,000.00
11/30/00
State Bank of India
01/20/00
6.110
2,000,000.00
01/19/01
State Bank of India
06/12/00
6.230
2,000,000.00
06/12/01
Wilshire State Bank
01/12/00
6.090
4,000,000.00
01/12/01
Wilshire State Bank
03/17/00
6.230
4,000,000.00
03/19/01
Wilshire State Bank
04/18/00
6.090
5,000,000.00
04/18/01
Wilshire State Bank
05/17/00
6.370
2,000,000.00
05/17/01
Wilshire State Bank
06/07/00
6.290
2,000,000.00
06/07/01
Wilshire State Bank
08/31/00
6.290
4,000,000.00
08/31/01
MERCED
County Bank
04/20/00
6.050
5,000,000.00
10/17/00
County Bank
09/11/00
6.200
5,000,000.00
12/11/00
County Bank
07/19/00
6.340
5,000,000.00
01/18/01
County Bank
03/09/00
6.200
5,000,000.00
03/09/01
MONTEREY PARK
Trust Bank FSB
03/27/00
6.180
4,000,000.00
10/02/00
Trust Bank FSB
06/26/00
6.220
2,000,000.00
01/02/01
NORWALK
Cerritos Valley Bank
07/06/00
6.020
1,000,000.00
10/05/00
Cerritos Valley Bank
08/30/00
6.350
1,000,000.00
11/28/00
Cerritos Valley Bank
09/15/00
6.180
1,000,000.00
12/14/00
Cerritos Valley Bank
08/30/00
6.410
1,000,000.00
02/26/01
22
NAME
OAKDALE
TIME DEPOSITS
DEPOSIT
DATE YIELD
PAR MATURITY
AMOUNT (S) DATE
Oak Valley Community Bank
08/02/00
6.230
500,000.00
10/31/00
Oak Valley Community Bank
07/31/00
6.230
1,000,000.00
10/31/00
Oak Valley Community Bank
05/01/00
6.090
1,000,000.00
10/31/00
Oak Valley Community Bank
08/09/00
6.340
500,000.00
02/05/01
Oak Valley Community Bank
08/21 /00
6.360
500,000.00
03/23/01
Oak Valley Community Bank
03/24/00
6.230
1,000,000.00
03/23/01
.Oak Valley Community Bank
09/29/00
6.240
1,500,000.00
06/05/01
ONTARIO
Citizens Business Bank
05/10/00
6.480
10,000,000.00
11/06/00
Citizens Business Bank
05/25/00
6.450
20,000,000.00
12/07/00
Citizens Business Bank
06/15/00
6.260
10,000,000.00
12/15/00
Citizens Business Bank
07/06/00
6.270
5,000,000.00
01/12/01
Citizens Business Bank
08/09/00
6.350
10,000,000.00
02/09/01
Citizens Business Bank
03/08/00
6.240
5,000,000.00
03/08/01
Citizens Business Bank
09/20/00
6.240
10,000,000.00
03/26/01
Citizens Business Bank
09/18/00
6.230
10,000,000.00
03/26/01
Citizens Business Bank
10/05/00
6.330
20,000,000.00
04/05/01
PALM SPRINGS
Canyon National Bank 09/14/00 6.130 95,000.00 12/13/00
PALO ALTO
Bay Area Bank
08/04/00
6.270
5,000,000.00
11/02/00
Bay Area Bank
07/26/00
6.300
5,000,000.00
01/22/01
Bay Bank of Commerce
08/04/00
6.270
5,000,000.00
11/02/00
Coast Commercial Bank
07/20/00
6.240
5,000,000.00
10/18/00
Coast Commercial Bank
09/11/00
6.200
20,000,000.00
12/11/00
Cupertino National Bank
08/02/00
6.270
10,000,000.00
11/02/00
Cupertino National Bank
08/04/00
6.270
25,000,000.00
11/02/00
Cupertino National Bank
09/01/00
6.340
20,000,000.00
12/01 /00
Cupertino National Bank
09/18/00
6.160
10,000,000.00
12/18/00
Golden Gate Bank
09/01/00
6.340
9,000,000.00
12/01/00
Mid -Peninsula Bank
08/02/00
6.270
15,000,000.00
11/02/00
Mid -Peninsula Bank
08/04/00
6.270
20,000,000.00
11/02/00
Mid -Peninsula Bank
09/01/00
6.340
5,000,000.00
12/01/00
Mid -Peninsula Bank
09/20/00
6.230
10,000,000.00
03/19/01
Peninsula Bank of Commerce
09/11/00
6.100
15,000,000.00
12/11/00
23
TIME DEPOSITS
DEPOSIT
PAR
MATURITY
NAME
DATE
YIELD
AM(S)
DATE
PALOS VERDES ESTATES
Malaga Bank
09/26/00
6.220
4,000,000.00
12/27/00
Malaga Bank
07/19/00
6.350
2,000,000.00
01/19/01
Malaga Bank
09/26/00
6.270
2,000,000.00
06/04/01
PASADENA
Community Bank
10/25/99
5.490
5,000,000.00
10/27/00
Community Bank
12/07/99
5.700
5,000,000.00
12/08/00
Community Bank
12/13/99
5.650
10,000,000.00
12/15/00
Community Bank
01/10/00
6.040
20,000,000.00
01/12/01
Community Bank
06/22/00
6.110
5,000,000.00
06/22/01
Community Bank
08/11/00
6.190
15,000,000.00
08/13/01
PETALUMA
Bank of Petaluma
07/24/00
6.200
2,500,000.00
10/23/00
Bank of Petaluma
02/07/00
6.210
1,000,000.00
02/07/01
PICO RIVERA
Pacific West National Bank
11/23/99
5.650
1,000,000.00
11/30/00
PLACERVILLE
El Dorado Savings Bank
02/08/00
6.230
5,000,000.00
02/08/01
El Dorado Savings Bank
03/22/00
6.250
5,000,000.00
03/22/01
El Dorado Savings Bank
04/13/00
6.150
5,000,000.00
04/13/01
El Dorado Savings Bank
05/02/00
6.180
5,000,000.00
05/02/01
El Dorado Savings Bank
06/16/00
6.150
5,000,000.00
06/18/01
PO_
PFF Bank and Trust
11/30/99
5.900
8,000,000.00
12/01/00
PFF Bank and Trust
03/10/00
6.450
10,000,000.00
03/09/01
PORTERVILLE
Bank of the Sierra
07/28/00
6.300
10,000,000.00
01/24/01
r
24
TIME DEPOSITS
DEPOSIT PAR MATURITY
N_ D_ YIELD AMOUNT (s) DATE
RANCHO SANTA FE
La Jolla Bank 08/11/00 6.340 15,000,000.00 02/07/01
La Jolla Bank 09/26/00 6.310 10,000,000.00 03/26/01
RED BLUFF
Tehama Bank 06/28/00 6.260 5,000,000.00 01/05/01
Tehama Bank 09/08/00 6.300 4,000,000.00 06/01/01
REDDING
North Valley Bank 09/18/00 6.230 3,000,000.00 03/19/01
RICHMOND
Mechanics Bank
10/07/99
5.330
10,000,000.00
10/13/00
Mechanics Bank
03/07/00
6.230
10,000,000.00
03/07/01
Mechanics Bank
04/04/00
6.260
10,000,000.00
04/06/01
Mechanics Bank
04/25/00
6.080
10,000,000.00
04/25/01
Mechanics Bank
05/05/00
6.190
10,000,000.00
05/07/01
Mechanics Bank
06/12/00
6.230
10,000,000.00
06/12/01
Mechanics Bank
08/11/00
6.190
10,000,000.00
08/13/01
SACRAMENTO
American River Bank
04/03/00
6.190
1,000,000.00
10/02/00
American River Bank
12/28/99
5.960
1,000,000.00
12/27/00
American River Bank
09/26/00
6.300
3,000,000.00
03/26/01
American River Bank
06/26/00
6.180
1,000,000.00
06/26/01
Bank of Sacramento
02/16/00
6.240
1,000,000.00
02/16/01
Bank of Sacramento
03/03/00
6.290
500,000.00
03/05/01
Golden One Credit Union
07/28/00
6.160
10,000,000.00
10/27/00
Golden One Credit Union
03/24/00
6.180
20,000,000.00
03/23/01
Golden One Credit Union
06/08/00
6.230
20,000,000.00
06/08/01
Merchants National Bank
07/24/00
6.120
2,000,000.00
10/24/00
Merchants National Bank
07/24/00
6.270
2,000,000.00
01/22/01
River City Bank
04/10/00
6.170
5,000,000.00
10/06/00
River City Bank
01/31/00
6.140
5,000,000.00
10/27/00
River City Bank
08/18/00
6.370
5,000,000.00
02/26/01
Safe Credit Union
09/06/00
6.330
20,000,000.00
02/02/01
Sanwa Bank of Califomia
07/14/00
6.280
10,000,000.00
01/10/01
Sanwa Bank of Califomia
02/07/00
6.180
7,000,000.00
02/09/01
25
TIME DEPOSITS
DEPOSIT PAR MATURITY
NAME DATE YIELD AMOUNDATE
SACRAMENTO (continued)
Sanwa Bank of California
08/22/00
6.350
10,000,000.00
02/23/01
Sanwa Bank of California
08/15/00
6.360
50,000,000.00
02/23/01
Sanwa Bank of California
07/26/00
6.290
5,000,000.00
07/26/01
Union Bank of California
04/25/00
6.000
50,000,000.00
10/24/00
Union Bank of California
05/02/00
6.130
100,000,000.00
10/31/00
Union Bank of California
05/16/00
6.530
50,000,000.00
11/14/60
Union Bank of California
05/23/00
6.380
100,000,000.00
11/21/00
Union Bank of California
09/25/00
6.240
100,000,000.00
03/26/01
SAL_
Community Bk Central California
07/26/00
6.160
12,000,000.00
10/24/00
Community Bk Central California
07/31/00
6.210
10,000,000.00
11/06/00
SAN BERNARDINO
Business Bank of California
08/09/00
6.350
12,000,000.00
02/05/01
SAN DIEGO
First United Bank
11/30/99
5.700
1,500,000.00
12/01/00
First United Bank
.08/07/00
6.320
1,000,000.00
02/16/01
First United Bank
06/21/00
6.110
1,500,000.00
06/21/01
Mission Federal Credit Union
08/30/00
6.340
10,000,000.00
11/30/00
Mission Federal Credit Union
09/21/00
6.190
10,000,000.00
01/11/01
Neighborhood National Bank
02/02/00
6.240
1,000,000.00
02/09/01
Scripps Bank
06/27/00
5.880
5,000,000.00
10/02/00
Scripps Bank
06/21/00
6.100
10,000,000.00
11/02/00
Scripps Bank
09/18/00
6.160
5,000,000.00
12/12/00
Scripps Bank
06/15/00
6.260
5,000,000.00
12/12/00
SAN FRANCISCO
Bank of Canton California
05/12/00
6.400
5,000,000.00
11/02/00
Bank of Canton California
05/05/00
6.240
5,000,000.00
11/03/00
Bank of Canton California
11/10/99
5.460
10,000,000.00
11/10/00
Bank of Canton California
07/21/00
6.310
5,000,000.00
01/12/01
Bank of Canton California
05/31/00
6.430
10,000,000.00
01/12/01
Bank of Canton California
08/09/00
6.320
10,000,000.00
02/05/01
Bank of Canton California
09/13/00
6.220
5,000,000.00
05/22/01
Bank of Canton California.
05/22/00
6.230
10,000,000.00
05/22/01
Bank of Canton California
09/01/00
6.260
20,000,000.00
08/31/01
26
NAME
SAN FRANCISCO (continued)
TIME DEPOSITS
DEPOSIT
DATE YIELD
PAR MATURITY
AMOUNT (s) DATE
Bank of the West
09/01/00
6.340
50,000,000.00
01/08/01
Bank of the West
08/21/00
6.350
50,000,000.00
02/23/01
Bank of the West
04/14/00
6.170
50,000,000.00
04/16/01
Bank of the West
05/01/00
6.140
25,000,000.00
04/27/01
Bank of the West
04/28/00
6.140
51,500,000.00
04/27/01
Bank of the West
05/05/00
6.190
25,000,000.00
05/04/01
Bank of the West
05/16/00
6.400
25,000,000.00
05/18/01
Bank of the West
05/25/00
6.230
142,000,000.00
05/25/01
Bank of the West
07/03/00
6.080
34,000,000.00
07/06/01
California Federal Bank
01/05/00
6.080
8,000,000.00
01/05/01
California Federal Bank
07/17/00
6.290
100,000,000.00
01/17/01
California Pacific Bank
09/20/00
6.160
1,000,000.00
12/19/00
California Pacific Bank
09/20/00
6.220
1,000,000.00
03/19/01
Millennium Bank
05/01/00
6.110
2,000,000.00
10/31/00
Millennium Bank
08/30/00
6.360
1,000,000.00
11 /28/00
Millennium Bank
07/31 /00
6.340
1,000,000.00
01 /29/01
Millennium Bank
08/30/00
6.420
1,000,000.00
02/26/01
Oceanic Bank
03/07/00
6.230
2,000,000.00
03/15/01
Oceanic Bank
03/15/00
6.210
2,000,000.00
03/15/01
Trans Pacific National Bank
03/17/00
6.250
800,000.00
03/19/01
United Commercial Bank
07/07/00
6.020
30,000,000.00
10/06/00
United Commercial Bank
10/07/99
5.360
10,000,000.00
10/13/00
United Commercial Bank
07/26/00
6.300
20,000,000.00
01/22/01
United Commercial Bank
08/10/00
6.350
20,000,000.00
02/06/01
United Commercial Bank
03/20/00
6.240
25,000,000.00
03/20/01
United Commercial Bank
09/01/00
6.320
20,000,000.00
08/31/01
SAN JOSE
Heritage Bank of Commerce 08/21/00 6.360 2,000,000.00 02/16/01
Meriwest Credit Union 07/26/00 6.310 14,000,000.00 01/22/01
Santa Clara Co. Fed. C.U. 08/10/00 6.340 15,000,000.00 02/06/01
SAN LUIS OBISPO
First Bank of San Luis Obispo
07/12/00
6.130
1,000,000.00
10/10/00
First Bank of San Luis Obispo
07/24/00
6.140
1,000,000.00
10/23/00
First Bank of San Luis Obispo
08/03/00
6.280
3,600,000.00
11/01/00
First Bank of San Luis Obispo
08/08/00
6.270
2,000,000.00
11/06/00
First Bank of San Luis Obispo
08/21/00
6.290
2,500,000.00
11/20/00
First Bank of San Luis Obispo
09/18/00
6.160
5,000,000.00
12/18/00
Mission Community Bank
07/10/00
6.050
1,000,000.00
10/10/00
27
TIME DEPOSITS
DEPOSIT PAR MATURITY
NAME DATE YIELD AMOUNT (s) DATE
SAN LUIS OBISPO (continued)
Mission Community Bank
09/12/00
6.190
1,000,000.00
12/11 /00
Mission Community Bank
01/10/00
6.060
500,000.00
01/12/01
Mission Community Bank
09/12/00
6.280
1,000,000.00
03/12/01
San Luis Trust Bank
07/11/00
6.240
350,000.00
01/08/01
San Luis Trust Bank
08/04/00
6.380
1,000,000.00
01/31/01
SAN MARINO
East West Federal Bank
07/05/00
5.880
12,000,000.00
10/05/00
East West Federal Bank
08/03/00
6.270
35,000,000.00
11/02/00
East West Federal Bank
08/09/00
6.280
38,000,000.00
11/13/00
East West Federal Bank
05/04/00
6.200
35,000,000.00
05/04/01
SAN RAFAEL
Westamerica Bank
07/25/00
6.160
25,000,000.00
10/25/00
Westamerica Bank
08/07/00
6.330
25,000,000.00
01/30/01
Westamerica Bank
07/31/00
6.310
25,000,000.00
01/30/01
Westamerica Bank
09/19/00
6.220
25,000,000.00
03/22/01
Westamerica Bank
04/18/00
6.080
25,000,000.00
04/18/01
Westamerica Bank
05/15/00
6.400
50,000,000.00
05/15/01
Westamerica Bank
07/14/00
6.080
25,000,000.00
07/13/01
SAN RAMON
Ebtel Federal Credit Union
07/06/00
6.030
1,750,000.00
10/06/00
Ebtel Federal Credit Union
07/06/00
6.240
1,750,000.00
01/05/01
SANTA BARBARA
FNB of Central California
04/21/00
6.040
10,000,000.00
10/18/00
FNB of Central California
07/10/00
6.230
10,000,000.00
01/08/01
FNB of Central California
09/07/00
6.310
10,000,000.00
03/06/01
FNB of Central California
08/07/00
6.350
10,000,000.00
05/01/01
Santa Barbara Bank & Trust
04/07/00
6.160
5,000,000.00
10/10/00
Santa Barbara Bank & Trust
04/17/00
6.100
5,000,000.00
10/10/00
Santa Barbara Bank & Trust
07/14/00
6.290
10,000,000.00
01/10/01
Santa Barbara Bank & Trust
07/21/00
6.250
10,000,000.00
01/22/01
Santa Barbara Bank & Trust
08/11/00
6.210
10,000,000.00
03/09/01
Santa Barbara Bank & Trust
09/08/00
6.330
10,000,000.00
04/06/01
Santa Barbara Bank & Trust
06/09/00
6.260
10,000,000.00
06/08/01
Santa Barbara Bank & Trust
07/07/00
6.080
10,000,000.00
07/06/01
28
TIME DEPOSITS
DEPOSIT PAR MATURITY
NAME DATE YIELD AMOUNT (s) DATE
SANTA CLARA
Bank of Santa Clara 03/17/00 6.230 2,000,000.00 03/19/01
SANTA CLARITA
Valencia Bank & Trust 09/22/00 6.230 1,000,000.00 03/21 /01
Valencia Bank & Trust 09/22/00 6.230 3,000,000.00 03/21 /01
�L,1111k1F.L11.101--1-1
National Bank of the Redwoods
05/03/00
6.250
10,000,000.00
10/30/00
Redwood Credit Union
09/06/00
6.350
17,000,000.00
03/05/01
STOCKTON
Pacific State Bank
07/18/00
6.200
1,000,000.00
10/16/00
Pacific State Bank
07/18/00
6.340
1,000,000.00
01/12/01
Union Safe Deposit Bank
08/11 /00
6.300
10,000,000.00
11 /09/00
Union Safe Deposit Bank
08/14/00
6.320
10,000,000.00
11/16/00
Union Safe Deposit Bank
08/07/00
6.360
10,000,000.00
02/05/01
Union Safe Deposit Bank
03/15/00
6.260
10,000,000.00
03/15/01
Union Safe Deposit Bank
04/13/00
6.200
10,000,000.00
04/13/01
Washington Mutual Bank
10/13/99
5.370
15,000,000.00
10/27/00
Washington Mutual Bank
04/21/00
6.030
15,000,000.00
10/27/00
Washington Mutual Bank
11/08/99
5.420
15,000,000.00
11/13/00
Washington Mutual Bank
06/01/00
6.330
15,000,000.00
11/13/00
Washington Mutual Bank
12/20/99
5.940
15,000,000.00
12/28/00
Washington Mutual Bank
07/14/00
6.120
15,000,000.00
01/23/01
Washington Mutual Bank
07/14/00
6.250
15,000,000.00
01/23/01
Washington Mutual Bank
08/10/00
6.330
15,000,000.00
02/22/01
Washington Mutual Bank
02/18/00
6.210
15,000,000.00
02/22/01
Washington Mutual Bank
09/15/00
6.180
30,000,000.00
03/14/01
SUNNYVALE
Asiana Bank 07/07/00 6.050 1,500,000.00 10/06/00
TORRANCE
China Trust Bank (USA)
07/07/00
6.020
10,000,000.00
10/06/00
China Trust Bank (USA)
07/24/00
6.210
15,000,000.00
10/23/00
China Trust Bank (USA)
08/14/00
6.300
10,000,000.00
11/13/00
China Trust Bank (USA)
09/05/00
6.210
20,000,000.00
12/04/00
29
TIME DEPOSITS
DEPOSIT
NAME DATE
TORRANCE (continued)
China Trust Bank (USA)
09/14/00
South Bay Bank
05/01/00
South Bay Bank
09/13/00
South Bay Bank
07/17/00
South Bay Bank
07/31/00
South Bay Bank
08/28/00
TU._
First Fidelity Investment & Loan
07/17/00
First Fidelity Investment & Loan
07/27/00
First Fidelity Investment & Loan
08/10/00
First Fidelity Investment & Loan
03/01/01
Sunwest Bank
07/17/00
Sunwest Bank
07/19/00
Sunwest Bank
07/31/00
Sunwest Bank
07/27/00
Sunwest Bank
09/08/00
VACAVILLE
Travis Credit Union
09/06/00
VI_
Bank of Visalia
08/01/00
Bank of Visalia
08/01 /00
WATSONVILLE
Monterey Bay Bank
09/29/00
WHITTIER
Quaker City Bank
07/03/00
Quaker City Bank
07/12/00
Quaker City Bank
04/18/00
Quaker City Bank
09/08/00
TOTAL TIME DEPOSITS AS OF 09/30/00
PAR MATURITY
YIELD AMOUNT DATE
6.110
5,000,000.00
12/13/00
6.090
2, 000, 000.00
10/31 /00
6.120
2,000,000.00
12/12/00
6.320
2, 000, 000.00
01 /16/01
6.330
1,000,000.00
01 /29/01
6.390
3,000,000.00
03/02/01
6.180
10,000,000.00
10/17/00
6.290
4,000,000.00
01/25/01
6.340
6,000,000.00
02/06/01
6.210
15, 000, 000.00
03/01 /01
6.040
3,500,000.00
10/12/00
6.180
2, 500, 000.00
10/20/00
6.310
2,500,000.00
01 /25/01
6.290
3,300,000.00
01 /25/01
6.300
1,000,000.00
03/09/01
6.350 40,000,000.00 03/05/01
6.220 2, 000, 000.00 10/30/00
6.340 1, 000, 000.00 01 /30/01
6.220 8,000,000.00 01 /05/01
5.830
15, 000, 000.00
10/02/00
6.260
7, 000, 000.00
01 /08/01
6.090
8,000,000.00
04/18/01
6.300
25, 000, 000.00
05/31 /01
4,037,440,000.00
30
BANK DEMAND DEPOSITS
SEPTEMBER 2000
($ in thousands)
DAILY BALANCES
DAY OF
BALANCES
WARRANTS
MONTH
PER BANKS
OUTSTANDING
1
$ 152,611
$ 1,777,534
2
1529611
19777,534
3
152,611
1,777,534
4
152,611
1,777,534
5
.4549182
196699392
6
2909967
1,692,132
7
3249839
1,6869328
8
3449875
199459691
9
3449875
1,945,691
10
3449875
1,9459691
11
322,801
197409890
12
3589865
1,6539852
13
2229007
1,330,232
14
2829921
1,504,976
15
5859465
197979219
16
5859465
198049435
17
585,465
1,804,435
18
3239928
195269955
19
2219758
1,442,331
20
7189443
195119626
21
5629266
1,449,254
22
7429398
199399225
23
7429398
199399225
24
7429398
1,939,225
25
921,168
1,4949284
26
4539939
1,4439871
27
1659320
192929130
28
1849957
1,486,690
29
4009843
290869265
30
400,843
2,089,704
AVERAGE DOLLAR DAYS
S 4079957 a/
a/ The prescribed bank balance for September was $390,362. This consisted of
$159,223 in compensating balances for services, balances for uncollected
funds of $238,287 and a deduction of $7,148 for August delayed deposit
credit.
31
DESIGNATION BY POOLED MONEY INVESTMENT BOARD
OF TREASURY POOLED MONEY INVESTMENTS AND DEPOSITS
No. 1615
In accordance with sections 16480 through 16480.8 of the Government Code, the Pooled Money Investment Board, at its
meeting on September 20, 2000, has determined and designated the amount of money available for deposit and investment
under said sections. In accordance with sections 16480.1 and 16480.2 of the Government Code, it is the intent that the
money available for deposit or investment be deposited in bank accounts and savings and loan associations or invested in
securities in such a manner so as to realize the maximum return consistent with safe and prudent treasury management,
and the Board does hereby designate the amount of money available for deposit in bank accounts, savings and loan associ-
actions, and for investment in securities and the type of such deposits and investments as follows:
1. In accordance with law, for deposit in demand
bank accounts as Compensating Balance for Services
$ 175,858,000
The active noninterest-bearing bank accounts designation constitutes a calendar month average balance. For purposes of
computing the compensating balances, the Treasurer shall exclude from the daily balances any amounts contained therein as
a result of nondelivery of securities purchased for "cash" for the Pooled Money Investment Account and shall adjust for any
deposits not credited by the bank as of the date of deposit. The balances in such accounts may fall below the above amount
provided that the balances computed by dividing the sum of daily balances of that calendar month by the number of days in
the calendar month reasonably approximates that amount. The balances may exceed this amount during heavy collection
periods or in anticipation of large impending warrant presentations to the Treasury, but the balances are to be maintained in
such a manner as to realize the maximum return consistent with safe and prudent treasury management.
2. In accordance with law, for investment in securities authorized by section 16430, Government Code, or in term interest -
bearing deposits in banks and savings and loan associations as follows:
From To Transactions
( 1) 09/18/2000 09/22/2000 $ 3,400,300,000
(2) 09/25/2000
(3) 10/02/2000
(4) 10/09/2000
(5) 10/16/2000
09/29/2000 $
10/06/2000 $
10/13/2000 $
10/20/2000 $
In Securities
(section 16430)*
$ 38,392,560,000
Time Deposits in
Various Financial
Institutions
(sections 16503a
and 16602)'
$ 4,027,440,000
(625,800,000) $ 37,766,760,000 $
(1,651,600,000) $ 36,115,160,000 $
Estimated
Total
$ 42,420,000,000
4,027,440,000 $ 41,794,200,000
4,027,440,000 $ 40,142,600,000
(623,300,000) $ 35,491,860,000 $ 4,027,440,000 $ 39,519,300,000
631,600,000 $ 36,123,460,000 $ 4,027,440,000 $ 40,150,900,000
From any of the amounts specifically designated above, not more than 30 percent in the aggregate may be invested
in prime commercial paper under section 16430(e), Government Code.
Additional amounts available in treasury trust account and in the Treasury from time to time, in excess of the
amounts and for the same types of investments as specifically designated above.
Provided, that the availability of the amounts shown under paragraph 2 is subject to reduction in the amount by
which the bank accounts under paragraph 1 would otherwise be reduced below the calendar month average balance
of $ 175,858,000.
POOLED MONEY INVESTMENT BOARD:
001,
ChAfKK n
-C G
Member
ti
Dated: September 20, 2000 �--
Government Code 32 Member
INVESTMENT ADVISORY BOARD Written Correspondence C
Meeting Date: December 13, 2000
TITLE:
LAIF Answer Book Update
BACKGROUND:
From time to time LAIF updates their answer book. No significant changes to the
updated information was noted by staff.
RECOMMENDATION:
Receive file.
Jcfhn M. Falc ne , Finance Director
SEPTEMBER 30, 2000
mi
QUARTERLY
ANSWER BOOK
ou
UPDATE
REPLACEMENT PAGES If
29 49 59 129 139 149 259 279 289 399 409 41, 429 479
51 AND 52
K
JUNE 309 2000
QUARTERLY
El
ANSWER BOOK
UPDATE
lu
REPLACEMENT PAGES
29 49 59 129 139 149 259 269 279 289 399 409 41 AND
\`42
Additionally, the PMIA has Policies, Goals and Objectives for the, portfolio to
make certain that our goals of Safety, Liquidity and Yield are not jeopardized and that
prudent management prevails. These policies are formulated by investment staff and
reviewed by both the PMIB and the LAIF Board on an annual basis.
The State Treasurer's Office is audited by the Bureau of State Audits on an annual
basis. The resulting opinion is included in the subsequent Pooled Money monthly report
following its publication. The Bureau of State Audits also has a continuing audit process
throughout the year. All investment and LAIF claims are audited on a daily basis by the
State Controller's Office as well as an in-house audit process involving three separate
divisions.
It has been determined that the State of California cannot declare bankruptcy
under Federal regulations, thereby allowing the Government Code Section 16429.3 to
`- stand. This Section states that "money placed with the state treasurer for deposit in the
LAIF shall not be subject to either: (a) transfer or loan pursuant to Sections 16310,
16312, or 16313, or (b) impoundment or seizure by any state official or state agency."
The LAIF has grown from 293 participants and $468 million in 1977 to 2,815
participants and $12.3 billion in 2000.
State Treasurer's Office
Local Agency Investment Fund
P.O. Box 942809
Sacramento, CA 94209-0001
(916) 653-3001
http://www.treasurer.ca.gov
2 Revised September 30, 2000
lu
LOCAL AGENCY INVESTMENT FUND
Participation as of 9/30/00
2,815 Agencies
239 194 BONDS 54 COUNTIES
TRUSTEES 7% 2% 466 CITIES It
i "7oi
15862
DISTRICTS
66%
■ 54 COUNTIES
p 466 CITIES
■ 1,862 DISTRICTS
it
■ 239 TRUSTEES
■ 194 BONDS
4
Revised September 30, 2000
PHILIP ANGELIDES
TREASURER
STATE OF CALIFORNIA
INVESTMENT DIVISION SELECTED INVESTMENT DATA
ANALYSIS OF THE POOLED MONEY INVESTMENT ACCOUNT PORTFOLIO
(000 OMITTED)
September 30, 2000
PERCENTAGE
CHANGE FROM
TYPE OF SECURITY AMOUNT PERCENT PRIOR MONTH
Government
Bills $ 2,696,971 6.31 +0.23
Bonds
0
0.00
0
Notes
3,377,164
7.90
+0.68
Strips
0
0.00
0
Total Governments
$ 6,074,135
14.21
+0.91
Federal Agency Coupons
$ 3,312,880
7.75
-0.31
Certificate of Deposits
7,119,067
16.67
-2.68
Bank Notes
1,290,026
3.02
-0.44
Bankers' Acceptances
36,707
0.08
-0.01
Repurchases
0
0.00
0
Federal Agency Discount Notes
9,020,524
21.11
+1,.56
Time Deposits
4,037,440
9.45
+0.07
GNMAs
1,231
0.00
0
Commerical Paper
8,274,752
19.37
+1.46
FHLMC
11,965
0.03
0
Corporate Bonds
2,498,854
5.86
-0.12
Pooled Loans
2,550,821
5.97
-0.62
GF Loans
0
0.00
0
Reversed Repurchases
-1,504,124
-3.52
-0.18
Total (All Types)
$ 42,7249278
100.00
Average Life of Portfolio as of September 30, 2000 is 192 Days
,?
5 Revised September 30, 2000
United States T
Bills
Notes
Federal Agency:
Bonds
Floaters
MBS
GNMA
SBA
FHLMC PC
Discount Notes
Bankers A,
Corporate:
Bonds
Floaters
ces 1 $
Ds
$
Bank Notes
$
Repurchase Agreements
$
Time Deposits
$
AB 55 & GF Loans
$
Commercial Paper
$
Reverse Repurchase
$
TOTAL
$
State of California
Pooled Money Investment Account
Market Valuation
9/3012000
2,696,971,482.00 $
3,377,163,931.79 $
2,464,776,278.70 $
100,000,000.00 $
423,673,520.65 $
1,230,915.80 $
324,430,070.59 $
11,964,948.28 $
9,020,523,916.28 $
36,707,467.51 1 $
729,255,461.15 1 $
1,769,598,499.27 1 $
7,119,067,092.69 $
1,290,025,941.31 $
4,037,440,000.00 $
2,550,821,107.73 $
8,274,752,096.65 $
(1,504,124,416.00) $
42,724,278,314.40 $
Fair Value Including Accrued Interest
2,766,856,01.5.29 1 $
3,367,550,739.87 $
2,464,429,334.25 $
100,000,000.00 $
423, 673, 520.65 $
1,230,915.80 $
324,357,878.12 $
11,964,948.28 $
9,271,510,947.47 1 $
37,741,987.72 1 $
727,692,577.72 $
1,769,598,499.27 $
7,117,666,374.94
$
1,290,025,941.31
$
4,037,440,000.00
$
2, 550,821,107.73
$
8,356,734,575.92
$
(1,504,124,416.00)
$
43,115,170, 948.33
$
Ki
Accrued Interest
2,765,830,111.05
3,372,155,750.00 $
2,463,297,089.35 $
100,021,000.00 $
409,221,528.37 $
1,361,597.16 $
322,771,398.35 $
12,303,831.15 $
9,271,623,890.11
NA
30,161,227.25
34,291,425.61
1,001,267.00
2,298,670.87
12,144.58
3,821,177.79
192,292.29
NA
37,742,829.81 T NA
723,810,193.44 $ 11,849,598.25
1,774,726,723.92 1 $ 14,527,045.82
7,116,932,591.40
$
127,771,592.88
1,289,876,409.10
$
21,556,496.48
-
NA
4,037,440,000.00
NA
2,550,821,107.73
NA
8,358,070,972.87
NA
(1,504,124,416.00)
$
(7,002,734.21)
43,103,882,607.81 1
$
240,480,204.61
$ 43,344,362,812.42
Repurchase Agreements, Time Deposits, AB 55 & General Fund loans, and
Reverse Repurchase agreements are carried at portfolio book value (carrying cost).
The value of each participating dollar equals the fair value divided by the amortized cost (.999738182).
As an example: if an agency has an account balance of $20,000,000.00, then the agency would report its
participation in the LAIF valued at $19,994,763.63 or $20,000,000.00 x .999738182.
12 Revised September 30, 2000
SOURCE OF FUNDS
Pooled Money Investment Account
as of 9/30/00
$42.724 Billion
Surplus
Money
36.29 %
Other General
.19 % Fund
33.52 %
Local
Agencies
30.00 %
lu
14
Revised September 30, 2000
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27
Revised September 30, 2000
LOCAL AGENCY INVESTMENT FUND
ADMINISTRATIVE EARNINGS (COST)
n F
09/30/91
Ell
0.25
1 1
w9
1.7
12/31 /91
0.23
1.7
03/31 /92
0.25
1.4
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1.2
09/30/92
0.23
1.2
12/31 /92
0.25
1.2
03/31 /93
0.25
1.2
06/30/93
0.26
1.2
09/30/93
0.23
1.0
12/31 /93
0.27
1.2
03/30/94
0.26
1.1
06/30/94
0.25
1.1
09/30/94
0.27
1.4
12/31 /94
0.26
1.4
03/31 /95
0.26
1.5
06/30/95
0.19
1.2
09/30/95
0.23
1.3
12/31 /95
0.25
1.5
03/31 /96
0.23
1.3
06/30/96
0.19
1.0
09/30/96
0.22
1.2
12/31 /96
0.26
1.5
03/31 /97
0.30
1.7
06/30/97
0.16
0.9
09/30/97
0.23
1.3
12/31 /97
0.24
1.4
03/31 /98
0.24
1.4
06/30/98
0.16
0.9
09/30/98
0.08
0.5
12/31 /98
0.24
1.3
03/31 /99
0.23
1.2
06/30/99
0.32
1.6
09/30/99
0.20
1.1
12/31 /99
0.22
1.2
3/31 /00
0.22
1.3
6/30/00
0.28
1.7
9/30/00
0.20
1.3
The law provides that reimbursements cannot exceed one-half of 1 percent of the
EARNINGS of the fund per quarter. Listed above is the percentage of earnings
(costs) per quarter.
in
28 Revised September 30, 2000
DISCLOSURE STATEMENT
PORTFOLIO HOLDINGS: DERIVATIVES
STRUCTURED NOTES, AND ASSET -BACKED SECURITIES
The Treasury Investment Division has received a number of inquiries
concerning our various portfolio holdings. Questions involving
structured notes, derivative products, and asset -backed securities are
the most notable. We have found that the lack of acceptable
definitions regarding these financial products has led to confusion and
disagreement with our reported positions.
In an effort to clarify the information provided in our monthly
statements, we would like to share with you our understanding of these
financial products, as defined by the U.S. General Accounting Office
(GAO).
In a recent survey of sales practices for these financial products the
GAO provided definitions and examples of what they considered
1) plain vanilla OTC derivatives, 2) more complex OTC derivatives,
3) structured notes, and 4) asset -backed securities. Following are The
GAO definitions, as well as the State of California Treasurer's
holdings in each category as of September 30, 2000:
39 Revised September 30, 2000
* 1. Plain Vanilla OTC Derivative Products
A derivative product is a financial instrument whose market value is derived
from a reference rate, index, or value of an underlying asset. OTC derivatives are
privately negotiated contracts and are not traded on organized exchanges.
U.S. $ 0 As of: 09/30/00
*2. More Complex OTC Derivative Products
Other more complex OTC derivatives have at least one of the following
characteristics:
a. Their prices tend to be difficult to obtain because they are often
available from only a few dealers.
b . The payments required by the derivative contract are calculated on the
basis of more than one interest rate, currency, asset, or other factor.
c . The derivative contract has terms that are not determined until some
future date.
d. The contract involves a term that acts as a multiplier or increases the
leverage of the rate(s) used to compute payments.
e. The contract CAN entail potentially unlimited risk.
U.S. $ 0 As of 09/30/00
* The Pooled Money Investment Account Portfolio has not invested in, nor
will it invest in, Derivative Products as defined in General Accounting
definitions #1 & #2. The GAO separation of derivatives, structured notes, and
asset -backed securities is consistent with GASB 94-1.
40 Revised September 30, 2000
3. Structured Notes
Structured notes are debt securities (other than asset -backed securities) whose cash -flow
characteristics (coupon rate, redemption amount, or stated maturity) depend upon one or
more indices and/or that have embedded forwards or options. They are issued by
corporations and by government -sponsored enterprises such as the Federal National
Mortgage Association and the Federal Home Loan Bank System.
U.S. $1,934.398 million As of: 09/30/00
4. Asset -Backed Securities
Asset -backed securities, the bulk of which are mortgage -backed securities, entitle their
purchasers to receive a share of the cash flows from a pool of assets such as principal
and interest repayments from a pool of mortgages (such as CMOs) or credit card
receivables.
U.S. $761.227 million As of: 09/30/00
Securities Accountability
1) Vanilla Derivatives 0
2) Complex Derivatives 0
3) Structured Notes
a. Callable Agency
b . 3 month LIBOR Agency Floater
c . 3 month LIBOR Corporate Floater
d. 2 year CMT Corporate Floater
e. 3 month T-Bill Agency Floater
f. 3 month T-Bill Corporate Floater
$ 00.000 million
$ 100.000 million
$1,834.398 million
$ 00.000 million
$ 00.000 million
$ 00.000 million
In
In
41
Revised September 30, 2000
In
4) Asset -Backed
a. Small Business Association Pools $ 324.358 million
b . Agency CMOs $ 423.673 million
C. GNMA Pools $ 1.231 million
d. FHLMC PC Pools $ 11.965 million
Total Portfolio As of: 09/30/00 $42,72492789314.40
Financial Products as a percent of portfolio: 6.309%
K
42 Revised September 30, 2000
How to Participate in the
Local Agency Investment Fund
Before any deposits will be accepted, the local governmental agency must file with the
State Treasurer a resolution and bank authorization form. The resolution will contain the
following: I
1. Name, address, and telephone number of agency.
2. A statement that the agency agrees to deposit or withdraw money in the Local
Agency Investment Fund in the State Treasury in accordance with the provisions of
Section 16429.1 of the Government Code for the purpose of investment as stated
therein.
3. The names and titles of the officials authorized by this resolution to order the de-
posit or withdrawal of money in the Local Agency Investment Fund.
4. Resolution number and date passed by the governing body.
5. Signature(s) of the person(s) authorized to sign resolutions.
6. Seal of the agency if one is usually affixed to resolutions.
The bank authorization form will contain the following:
1. The names, titles and signature(s) of person(s) authorized to order the deposit or
withdrawal of money in the Local Agency Investment Fund.
2. Banking information signed by two persons authorized on the resolution.
Deposits or withdrawals must be in multiples of one thousand dollars ($1,000); minimum
transaction size is five thousand dollars ($5,000) and a cap of $30 million per account.
Bond proceeds also have a five thousand dollar ($5,000) minimum with no cap. Fifteen
transactions are allowed per month for each regular account. Deposits and withdrawals
count as separate transactions.
The LAIF provides each participating agency the following monthly reports:
• Agency Statement of Activity
• LAIF Newsletter providing Selected Investment Data of Pooled Portfolio, available on
the STO home page at www.treasurer.ca.gov
• Report of Monthly Activity of Pooled Portfolio, available on request
• Market Valuation of the Pooled Portfolio, available on the STO home page at
www.treasurer.ca.gov
The Maturity Schedule of the Pooled Portfolio is available on the STO home page at
www.treasurer.ca.gov.
47 Revised September 30, 2000
REPORTING DOCUMENTS
EACH MONTH YOU CAN EXPECT:
1) Your agency's statement of activity, which includes your beginning and ending balances and all
transactions and or adjustments which took place for the previous month.
2) A "Summary of Investment Data" for the previous month (included in the LAIF monthly
newsletter). This analysis of the Pooled Portfolio indicates the monthly changes for the portfolio in
comparison to the previous year, and LAIF deposit information for the previous month.
3) The "Market Valuation" of the Pooled Portfolio indicating the estimated market value for the
previous month. The Market Valuation is available on the STO home page at www.treasurer.ca.gov.
4) The "Pooled Money Investment Report," a summarization of the pool including investment data,
portfolio composition, investment transactions, time deposits and Pooled Money Board designations. Since
information for this report is gathered from several sources, it represents investment activity for the month
prior to the statements. The Monthly Report is available on request.
EACH QUARTER YOU WILL RECEIVE/EXPECT(IN ADDITION TO THE MONTHLY
INFORMATION&:
1) A "Maturity Schedule" for the Pooled Portfolio. This indicates the par values maturing by date
and type and the percentages represented by maturity range. The Maturity Schedule is available on the
STO home page at www.treasurer.ca.gov.
2) The synopsis of the most recent LAIF Advisory Board meeting. These notes indicate action
taken by the Board and other points of interest to the participating agencies.
3) LAIF "Answer Book" updates. The initial book was sent to all participating agencies in
January, 1997, with updates following on a quarterly basis. This book is specific to the LAIF and
includes information such as how and when the fund was created, how interest is calculated, the
percentage of fees charged and specific questions relating to the Pool and how it functions. The "Answer
Book" is available upon request.
ANNUALLY YOU WILL RECEIVE:
1) The "Pooled Money Investment Board Annual Report." This report is a year in review of the
previous fiscal year and includes information about the Pooled Money Investment Account (PMIA),
Surplus Money Investment Fund (SMIF), and the LAIF.
51 Revised September 30, 2000
2) Annual Information Updates. This form is sent to participating agencies to assist LAIF staff in
maintaining the most current information possible about your account with LAIF. We ask each agency to
have authorized person/s review, sign and return this form to LAIF as quickly as possible, whether or not
changes are needed.
3) LAIF calendar which indicates the dates the State of California (LAIF) is open for business.
1
4) Conference information. Approximately three months prior to the LAIF conference you will
receive a "save -the -date" notice, two months prior to the conference you will receive your registration
packet.
Y
A
;W19
§
`11� .� , t
6 nE £
LEM
s
LAIF lVbnthly Statement
tvbnthiv
Mail
20th of month
LAIF Newsletter which includes the
PMIA Summary of Investment Data
lVbnthly
Website
20th of month
PMIA Market Valuation available on
the STO home page
lVbnthly
Website
20th of month
PMIA Nlonthly Report
Monthl
On Recluest
20th of month
PMIA Maturity Schedule
Quartedv
Website
1
20th of month
Synopsis of Board Meeting Mnutes
Quarter)
Mail
.20th of month
LAI F Answer Book Updates
Quarterly
Mail
20th of month
PMIA Annual Re rt
Annually
Mail
20th of month
LAIF Annual Information Updates
Annual)
Mail
-January
LAIF Calendar
Annual)
Mail
December
Two months prior to
LAIF Conference Material
Annually
Mail
conference
We hope you will find this listing useful for your reporting requirements. If you do not receive any
of the above mentioned documents, please call LAIF at (916) 653-3001.
STO Website address: www.treasurer.ca.gov
52 Revised September 30, 2000
INVESTMENT ADVISORY BOARD Written Correspondence D
Meeting Date: December 13, 2000
TITLE:
Legislation Updates
BACKGROUND:
Attached is a summary of fiscal issues adopted by the State of California. Staff has
reviewed the items and attached two bills that impact the City investment/reporting
requirements - AB 943 and AB 2220.
Staff has contacted the California Debt and Investment Advisory Commission (CD IAC)
regarding AB 943 and has mailed the City Investment Policy. According to CDIAC
staff, the first quarterly investment report due will be the June 30, 2001 report. This
report will be due by August 31, 2001.
AB 2220 will require updating the investment policy to change the maximum dates.
In effect, there is no impact to the current City policy in these two areas.
RECOMMENDATION:
ReceXe)and file.
hn M. Falconer, Finance Director
SUMMARY OF 2000 STATUTES
RELATED TO FISCAL ISSUES
The following information was taken from the League of California Cities' annual Legislative
Wrap Up of bills signed into law during the last legislative session. This list only contains a
portion of the bills in the Wrap Up. Other bills on issues such as Public Retirement, Employee
Relations and Benefits, Housing and Transportation are contained in the complete document
that will be mailed to cities in December and will be on the League website at.www.cacifies-
in mid -December. A notice will be posted on the CSMFO group e-mail when the document is
available on-line.
STATE BUDGET
Taxation Research and Development Credit. Budget Trailer Bill. AB 465 (Nakano),
Chapter 103, Statutes of 2000. This measure makes conforming changes to the
California Research and Development tax credit to conform to federal formula changes.
Increases the amount of alternative incremental credit allowed under state law.
2000-01 State Budget. AB 1740 (Duchene), Chapter 52, Statutes of 2000. This
measure contains spending blueprint for state expenditures. Includes specific funding
for the California Law Enforcement Equipment Program or CLEEP to be funded at $75
million. 1) the funds appropriated for this item for allocation by the State Controller are
intended to be for one-time grants to local law enforcement agencies for purchase of
high-technology equipment; 2) of the amount appropriated in this item, the State
Controller shall allocate a minimum grant of $100,000 to each city police chief, county
sheriff, and to specific Police Protection Districts; and 3) the balance of any remaining
funds shall be allocated to county sheriffs and city police chiefs in accordance with the
proportionate share of the state's total population that resides in each county, city, and
city and county, as determined on the basis of the most recent January population
estimate developed by the Department of Finance.
Downtown Rebound Budget Trailer Bill. AB 2870 (Cedillo), Chapter 83, Statutes of
2000. This legislation is the Budget Trailer bill to establish the Downtown Rebound
Program for the adaptive reuse of existing under-utilized buildings in downtown urban
areas, infill near transit areas, and provide planning grants to local agencies. This
legislation allocates $25 million for this purpose. Specifically the measure: 1) declares
findings on the need to revitalize downtown areas in California; 2) requires that 76
percent of the funds appropriated to the program shall be used for loans to project
sponsors for the adaptive reuse of vacant or under -used commercial/industrial
structures; 3) requires that 20 percent of units in the project shall be for low-income
families; 4) requires that $2,400,000 of the amount appropriated to the program shall be
used for Planning Grants to local governments for the following purposes--e. facilitates
infill housing through inventories, studies, and strategic action plans; f. facilitates
Statutes of 2000
Page 1 of 1 002
general plan and zoning ordinance updates; and g. assists owners of qualified buildings
in obtaining seismic and structural feasibility studies relating to adaptive reuse; and 5)
declares that the funds remaining in the program can be used for residential reuse
projects, the development of higher density housing adjacent to existing or planned
mass transit stations, or adaptive reuse of vacant or under -used commercial space.
Vehicles, Smog Impact Fee. Repeal, Rebates. SB 215 (Karnette), Chapter 32,
Statutes of 2000. This legislation repeals smog impact fees found to be illegal and
makes changes relating to the rebate of fees paid under this program. Transfers $665
million from the General Fund to the Smog Impact Fee Refund Account in the State
Transportation Fund for the purpose of making smog impact fee refunds.
Seniors' Tax Assistance. SB 1664 (Karnette), Chapter 60, Statutes of 2000. This
legislation provides a one-time 150 percent increase in property tax assistance
payments for low-income senior citizens and disabled individuals for the 2000-01 fiscal
year.
Claims Against the State. Mandate Reimbursement. SB 1894 (Peace), Chapter
177, Statutes of 2000. This measure appropriates $122,149,000 from the General Fund
and $35,000 from the Aeronautics Account in the State Transportation Fund to
reimburse local governments for the following mandates: 1) airport land use
commissions/plans--$35,000; 2) domestic violence services--$4,587,000; 3) American
Government course document requirements--$197,000; 4) Sudden Infant Death
Syndrome training--$1,417,000; 5) very high fire hazard severity zone identification--
$562,000; 6) pupil residency verification and appeals--$213,000; 7) criminal background
checks at schools--$4,956,000; and 8) deficiencies in prior -year appropriations--
$110,182, 000.
One Time Discretionary Local Fiscal Relief. AB 1396 (Villaraigosa), Chapter 903,
Statutes of 2000. This legislation appropriates $212,000,000 of one-time general fund
money for local fiscal relief. The measure requires $100,000,000 to be allocated to
counties, and then among the local agencies in each county, in proportion to their
educational Revenue Augmentation Fund contribution in 1999-2000. The remaining
$112,000,000 would be allocated as follows: $10,000,000 among counties in
accordance with population, $100,000,000 among counties and cities in accordance
with population, and $2,000,000 among independent recreation and park and library
special districts on the basis of reduction and transfer amounts for those districts for the
1999-2000 fiscal year.
Vehicle License Fee Reduction Offset. AB 511 (Alyuist), Chapter 107, Statutes of
2000. This legislation, among other provisions, makes clarifying changes to AB 858 of
2000, which revises the vehicle license fee offset. This measure appropriates $2.052
billion from the State General Fund to a new Special Reserve Fund for Vehicle License
Fee Tax Relief for payment of vehicle license fee rebates in 2000-01 and 2001-02. This
measure allows the Governor to direct the Controller to include a notice in each rebate
payment.
Vehicle License Fee Offsets. AB 858 (Kuehl), Chapter 106, Statutes of 2000. This
legislation provides that: 1) the VLF offset shall be not less than 35 percent in 2001 and
2002; 2) for VLF due in 2001 and 2002, there will be an additional offset equal to the
Statutes of 2000
Page 2 ,of 2 0613
difference between 67.5 percent and 35 percent or the applicable offset percentage
under current law; 3) the taxpayer shall pay a fee based on a bill from the Department of
Motor Vehicles containing the 35 percent offset, and then will receive a rebate check for
the difference between 35 and 67.5 percent; and 4) city and county revenue losses for
this increased VLF offset shall be reimbursed by the state.
PROPERTY TAX
Property Tax, Possessory Interests. AB 1966 (Wiggins), Chapter 406, Statutes of
2000. This measure excludes from the supplemental property tax new possessory
interests if they are month -to -month agreements and have a value of $50,000 or less
when transferred due to the sale of property. Current law requires that the owner of the
property on the lien date, January 1, pay property taxes due in the ensuing fiscal year
beginning July 1. Situations occur in which taxpayers owe tax on property even though
they have sold the property. For real estate sold between private parties, this isn't the
problem, because the escrow company involved in the transaction can prorate the
property taxes properly between buyer and seller. However, with possessory interests
in whom government owns the land, the taxes can't be prorated between lessor and
lessee. This legislation addresses this problem of property taxes owed when a
possessory interest is acquired by exempting from the supplemental property tax roll a
new possessory interest established by month -to -month agreements if the property is
worth $50,000 or less. This means that a new lessee of a possessory interest (e.g., an
airport hangar at a municipally -owned airport) won't be taxed immediately to the
possessory interest when acquired. Instead, the first tax bill will not be issued until the
subsequent fiscal year to balance our the tax that is still owed in the final year when
possession terminates.
Sale of Defaulted Property, Nonprofits. AB 2229 (Wiggins), Chapter 606, Statutes of
2000. This legislation will result in better oversight of purchases of tax defaulted
property by nonprofit organizations. Allegedly, some questionable purchases were
made where nonprofits quickly sold property for a use other than that intended, namely
low-income housing. This measure imposes new rules regarding the oversight and
allows nonprofits to purchase tax defaulted properties on an installment basis.
Disabled Veterans' Homeowners Exemption. SB 1362 (Poochigian), Chapter 1085,
Statutes of 2000. This measure substitutes an income level of $40,000 for the amount
specified as the threshold for benefits and provides for the annual adjustment of that
income level for inflation for the 2002 assessment year and each assessment year
thereafter. This legislation requires the exemption to be in the amount of $100,000, or
in the amount of $150,000 if the claimant's income does not exceed the adjusted
income threshold.
Property Tax. Veterans Exemption. SB 2195 (Soto), Chapter 1086, Statutes of 2000.
Existing law repeals the higher exemption amounts with regard to totally disabled
veterans for property taxes as of January 1, 2001. This legislation removes this repeal
date and extends the benefit indefinitely.
Property Taxation. AB 2891 (Committee on Revenue and Taxation), Chapter 646,
Statutes of 2000. This legislation makes changes to the Revenue and Taxation Code
relating to filing deadlines, filing dates, and petition submittal dates on the assessment
Statutes of 2000 4
Page 3 of 3
of unitary and non -unitary property. This legislation: 1) eliminates the need to file a
"declaration of intent to petition for reassessment" on both unitary and non -unitary
property; 2) replaces the 20-day deadline for filing declaration of intent and the 30-day
deadline for filing petitions for reassessment with statutory petition filing dates of July 20
for unitary assessments and September 20 for non -unitary assessments, and with a
single 50-day deadline for escape assessments; 3) requires mailing of notice of non -
unitary value by the last day of July, rather than the last day of June; 4) requires the
Board of Equalization to mail the allocated assessed value of an assessor's unitary
property no later than June 15, rather than "upon or prior to the completion of the
assessment;" 5) replaces the five-day deadline for filing petitions for correction of an
allocated assessment with a statutory petition filing date July 20; 6) increases the time of
notice of hearing on petitions for correction of an allocated assessment from five days to
ten working days; and 7) requires that petitions for correction of an allocated
assessment be determined by December 31, rather than by July 31.
Property Taxation. Transfer of Base Year Value. SB 1417 (Wright), Chapter 417,
Statutes of 2000. This legislation allows recision of Proposition 60 and Proposition 90
for elder and disabled homeowners. This measure provides relief if the property is
vacated within 90 days after the original claim for relief is filed with the assessor. It
requires that the request for recision must be received by the assessor within six years
after relief was granted and provides that any tax reduction provided pursuant to the
original claim will be recouped by the county from the taxpayer, with interest, so as to
prevent any doubling -up of benefits.
Property Taxation. SB 2170 (Committee on Revenue and Taxation), Chapter 647,
Statutes of 2000. This legislation is a State Board of Equalization -sponsored bill that
makes various changes to the property tax laws, as follows: 1) eliminates an
unnecessary "declaration of intent to petition for reassessment" of state -assessed
property, and instead requires that a petition for reassessment be filed by particular
dates; and 2) reinstates the eight -year statute of limitations for changes in ownership
where a change in ownership statement has not been filed. This legislation also clarifies
the time for filing property assessment appeals is within 60 days of the date of mailing
printed on the notice or the postmark date. This measure also adds the State Lands
Commission to the list of agencies who may receive appraisal data in possession of the
county assessor.
State Assessed Property. Delinquencies. AB 1991 (Cox), Chapter 116, Statutes of
2000. This measure provides that when taxes on a utility parcel become delinquent, the
tax collector may file for a summary judgment against the utility company for the
delinquent taxes. The legislation requires that the tax collector notify the assessee, at
least 60 days prior to initiating collection procedures. The notice must include the name
of the assessed value, the amount of tax, interest and penalty, and the fact that
collection will be enforced on the unsecured roll.
TEA Formula Allocations. SB 1581 (Escutia), Chapter 171, Statutes of 2000. At the
time Proposition 13 passed, some cities had no property tax levies (no -property tax
cities) and others had a minimum tax rate (low -property tax cities). In 1988, legislation
was enacted that required counties to shift some property tax revenues (tax equity
allocations or TEA) to these cities. Counties may reduce the TEA if certain
circumstances occur, such as the city receiving increased property tax in return for
Statutes of 2000 ,
Page 4,of 4'
accepting additional service responsibilities. Recently, a number of cities have
negotiated or considered negotiating with their counties an exchange of increased
property taxes for increased services. This legislation prohibits counties from reducing
the TEA formula when a city enters a "services for revenue agreement."
Property Taxation. Revenue Allocation. TEA. SB 1883 (Sher), Chapter 419,
Statutes of 2000. The TEA formula to no- and low -property tax cities may also be
reduced by the county if a city lowers or eliminates a tax base or rate that was
implemented prior to January 1, 1988. This special statute redefines the TEA reduction
if the city adopts a new tax revenue after January 1, 1998. The TEA formula is
recalculated to net the tax loss in the first year following the elimination or reduction and
the increased revenues of the new tax in the first year. The measure applies only to
Santa Clara County.
SALES TAX
Sales Taxes, Interest Payments, Pipeline Assessment. AB 2612 (Brewer), Chapter
607, Statutes of 2000. This measure states legislative intent to equalize the interest
rates applied to over- and under -payments of sales and use tax and extends the sunset
on the uniform method for assessing intercounty pipeline rights -of -way from June 30,
2001 to June 30, 2011.
Sales and Use Tax. Retailers and Sellers. Conventions. AB 330 (Floyd), Chapter
617, Statutes of 2000. Existing law provides that a retailer shall not be considered a
retailer engaged in business in this state if that retailer's sole physical presence in the
state is to engage in convention and trade show activities, and if the retailer does not
engage in those convention and trade show activities for more than seven days, in
whole or part, in this state during any 12 month period and did not derive more than
$100,000 of gross income from those activities in this state during the prior calendar
year. However, the retailer is liable for tax with respect to any sale occurring at, or
pursuant to, an order taken at or during the convention or trade show activities.
Sales and Use Tax. Worthless Accounts. AB 599 (Lowenthal), Chapter 600,
Statutes of 2000. A retailer is relieved from liability for sales tax that becomes due and
payable, insofar as the measure of the tax is represented by accounts that have been
found to be worthless and charged off for income tax purposes by the retailer, or if the
retailer is not required to file income tax returns, charged off in accordance with
generally accepted accounting principles. A retailer that has previously paid the tax
may, under rules and regulations prescribed by the board, take as a deduction, the
amount found worthless and charged off by the retailer. If these accounts are thereafter
in whole or in part collected by the retailer, the amount shall be included in the first
return filed after the collection and the tax shall be paid with the return. For purposes of
this subdivision, the term "retailer" shall include any entity affiliated with the retailer
under Section 1054, Title 26 of the United States Government Code.
Taxation. State Board of Equalization. AB 2894 (Committee on Revenue and
Taxation), Chapter 923, Statutes of 2000. This measure patterns several of the tax and
fee laws administered by the State Board of Equalization on the sales and use tax law
with respect to electronic funds transfers (EFT). Under the provisions of the measure,
tax and fee payers with average monthly liability of $20,000 or more, must remit
Statutes of 2000
Page 5`'6f 5 C
electronically; tax and fee payers with average monthly liabilities below $20,000 may
remit using (EFT). Tax and fee laws affected include the Motor Vehicle Fuel License
Tax, Diesel Fuel Tax, Use Fuel Tax, Energy Resources Surcharge, Emergency
Telephone User's Surcharge, Hazardous Substance Tax, Integrated Waste
Management Fee, Oil Spill Response, Prevention and Administration Fee, Underground
Storage Tank Maintenance Fee, and Fee Collection Procedures law.
VEHICLE LICENSE TAX
Motor Vehicle and Diesel Fuel Taxes. AB 2114 (Lonaville), Chapter 1053, Statutes of
2000. In 1987, the federal government began collecting the federal fuel tax for gasoline
at the terminal rack level. This legislation makes conforming changes to follow the
federal government's lead by moving the collection point of the state excise tax on
gasoline. As such, the point of taxation will be the same for both federal and California
fuel taxes.
Statutes of 2000
Page 6 of 6
BONDS AND DEBT
California Debt and Investment Advisory Commission. AB 943 (Dutra), Chaster
687, Statutes of 2000. This legislation establishes new investment reporting
requirements to the California Debt and Investment Advisory Commission (CDIAC) by
local governments. Currently, cities and counties are required by law to submit quarterly
investment reports to their legislative bodies. Cities must submit copies of their second
and fourth quarter calendar year within 60 days to CDIAC. In addition, annually cities
must submit a copy of their investment policies and send notice of any changes within
60 days. Cities that invest all funds with the Local Agency Investment Fund, county
investment pools, or certain other specified depositories, or a combination thereof, may
be exempted from the investment reporting requirements. To qualify for the exemption,
the city must certify in writing that all funds were invested in the qualified pools or
depositories. Though the legislation requires CDIAC to gather and provide information
on local agency investments, the legislation specifically states that CDIAC gains no
added oversight roles under the measure. CDIAC is directed to share results of the
reporting process and related benefits to the Legislature by May 1, 2006.
School Bonds. AB 1908 (Lempert), Chapter 44, Statutes of 2000. This legislation
becomes effective if the November 7, 2000 initiative "Smaller Classes, Safer Schools,
and Financial Accountability Act" is passed. The measure establishes certain
requirements on 55 percent voter approval bond measures permitted under the
initiative. The legislation requires a two/thirds vote of the school governing body to
place a 55 percent voter -approved bond measure on the ballot. These bond measures
may only be placed on regularly scheduled state and local elections or statewide special
elections. The measure limits the total amount of bonds to a fixed percentage of all
taxable property in the district and the tax rate may not exceed a fixed dollar amount per
$100,000 of taxable property. The bond measure must state that a citizen's oversight
committee will be appointed and annual independent audits will be conducted. The
oversight committee shall be charged with assuring that bond proceeds are used only
for school and classroom improvements.
District Accounts. Authorization. AB 1905 (Pacheco), Chapter 406, Statutes of
2000. Prior to enactment of the legislation, community service districts (CSD) were
required to deposit funds with the city or county in which they were located and the city
or county acted as treasurer for the CSD. With city or county approval, this measure
allows CSDs to establish depository accounts and permits the CSD to deposit and
disburse funds.
Local Agency Investments. AB 2220 (Baffin), Chapter 339, Statutes of 2000. City
investment options are restricted under state law to specific financial instruments. This
measure changes the maximum maturity period on banker's acceptances and
commercial paper. Banker's acceptances maturity periods are reduced from 270 days
to 180 days. Maturity periods for commercial paper are increased from 180 to 270 days.
The percentage of the city surplus funds that may be invested in these funds remains
the same-40 percent for banker's acceptances and 15 percent for commercial paper.
The changes reflect current market availability of these products.
Joint Powers Authority. AB 2300 (Florez), Chapter 723, Statutes of 2000. This
measure places certain requirements and restrictions on Mark -Roos debt financing by
Statutes of 2000
Page 7 of 7 �; 8
"roving Joint Powers Authorities" (JPAs). Current law allows public agencies to bring
action in superior court to validate the bond authorization and certain other related
actions. Under this legislation, if a party responds to a validation action that is
subsequently dismissed by the public agency, the respondent is granted 30 days to file
an action, during which time the bond issuance may not proceed. Public notice and
hearing notices would now be required prior to authorization rather than issuance of
bonds. Additionally, the notice must be sent via certified mail to both the Attorney
General and the California Debt and Investment Advisory Commission. The Attorney
General and the Treasurer may file action any time within 55 days following the mailing
of the required notice. The measure specifically excludes the following: redevelopment
activities; transportation facilities and vehicles; "captured" JPAs including overlapping
local government boundaries, county and cities or local agencies within the county, a
city and local agency within the city; JPAs granted allocation of the State's Private
Activity Bond Cap; and JPAs consisting of over 100 local cities, counties or agencies,
that require the member agency in which the financed facility will be located must
approve the project and/or facility to be funded by the bonds.
Joint Powers Agreements. AB 2033 (Torlakson/Florez), Chapter 724 Statutes of
2000. This measure makes technical amendments to AB 2300. The exempt JPAs in
the bond section were intended to be the same as in the special tax section; however
the multiagency JPA was listed as not less than 250 members rather than 100. This
measure corrects that error.
Local Government Finance. Special Taxes. SB 165 (Alarcon), Chapter 535, Statutes
of 2000. Referred to as the Local Agency Special Tax and Bond Accountability Act, this
measure places new reporting and accounting requirements on special taxes and
bonds. After January 1, 2001, any new special tax or bond measure placed before the
voters will require a statement of the special purpose to which the proceeds shall apply.
The taxes or bond proceeds must be placed in an account just for the proceeds, and the
proceeds may be used only for the stated special purpose. An annual report must be
issued on the special tax or bond no later than January 1, 2002, and annually thereafter.
The report shall include the amount of proceeds raised and expended and the status of
the project.
Local Agency Funds. SB 1493 (Lewis), Chapter 168, Statutes of 2000. This measure
clarifies the methods by which county treasurers may calculate and distribute funds to
local agencies investing idle funds in the county pool. The county treasurer is required
to apportion and distribute interest and other investment increments to participating
agencies at least quarterly. The treasurer must use cash, accrual, or any other
generally accepted accounting principle in determining the amount to be distributed.
Each agency participating in the pool must be advised of the accounting method used
by the county treasurer and notified at least 30 days prior to any proposed change in
accounting methodology.
Statutes of 2000
Page 8 of 8 O G� q
This measure requires the CPUC to study and report to the Legislature on whether the
definition of universal service should be broadened to include video and data services.
Taxation and the New Economy. SB 1933 (Vasconcellos), Chapter 619, Statutes of
2000. The United States Constitution limits state authority to levy taxes and authorize
Congress to regulate commerce between the state and foreign nations. Existing state
law imposes various state and local taxes on businesses and individuals in the state.
This legislation establishes, until 2004, the California Commission on Tax Policy in the
New Economy to develop a long-term strategy for revising state and local tax structure
for California. This Commission will be comprised of nine members from various
stakeholder groups including local government, public members, academia, business
and organized labor. The goal of the Commission will be to examine and described all
aspects of the current and future California economy, with special attention to the new
technologies, including the use of the Internet in electronic commerce.
MISCELLANEOUS FISCAL
Trial Court Funding. AB 233 (Dickerson), Chapter 15, Statutes of 2000. Existing law
requires the Judicial Council, in consultation with the California State Association of
Counties and the California County Auditors Association, to study and make
recommendations to the Legislature on alternative procedures that will improve the
collection and remittance of revenues to the Trial Court Trust Fund not later than
February 1, 1999. This measure changes the deadline to February 1, 2001.
Property Tax Administration Loan Program. AB 1036 (Wesson), Chapter 602,
Statutes of 2000. This legislation will continue for one year, the property tax
administration loan program. The program will expire at the end of this fiscal year. This
measure will extend the application of the State -County Property Tax Administration
Loan Program to include the 2001-02 fiscal year.
Infrastructure Financing Districts. Border Zone. AB 2314 (Duchene), Chapter 595,
Statutes of 2000. Existing law authorizes counties and cities to create infrastructure
financing districts in accordance with a prescribed procedure to finance public capital
facilities, using a prescribed procedure, in the border development zone in the Mexican
border region. This measure specifically includes public safety facilities as public capital
facilities that may be financed in this manner. The legislation also permits a district to
finance the purchase of sewage treatment capacity and provide that this capacity need
not be physically located within the boundaries of the district.
Local Agency Assessments. SB 1334 (Committee on Local Government), Chapter
262, Statutes of 2000. This legislation conforms certain provisions of a multitude of
benefit assessment acts to the statutory procedures for levying assessments pursuant
to Articles XIIIC and XIIID of the California Constitution. This measure also revises the
definition of "improvement" for purposes of the Landscaping and Lighting Act of 1972.
Local Government Omnibus Act of 2000. SB 1350 (Committee on Local
Government), Chapter 506, Statutes of 2000. This legislation enacts the Local
Government Omnibus Act of 2000, and makes clarifying and minor noncontroversial
changes to local government law.
Statutes of 2000
Page 10 of 10
REDEVELOPMENT
Redevelopment, Castle Air Force Base. AB 774 (Cardoza), Chapter 290, Statutes of
2000. This measure designates the County of Merced as the local base reuse authority
for Castle Air Force Base, and repeal the provisions of law creating and setting forth the
powers of the Castle Joint Powers Redevelopment Agency as the redevelopment
agency for the Castle Air Force Base project area.
Redevelopment, Transfers, Secessions. AB 2302 (Cardenas), Chapter 638, Statutes
of 2000. This legislation provides a process by which a redevelopment project area may
be transferred from an existing city to a newly incorporated city, in the case of
secession.
San Diego Regional Government Efficiency. SB 329 (Peace), Chapter 764, Statutes
of 2000. This measure enacts the San Diego Regional Government Efficiency
Commission Act, makes related findings and declarations, creates an eleven member
San Diego Regional Government Efficiency Commission, requires the Commission to
submit to the Legislature a plan and draft legislation for the consolidation of regional
agencies within the San Diego region, and grants specified powers to the Commission.
Enterprise Zones. SB 511 (Alarcon), Chapter 616, Statutes of 2000. This measure
authorizes additional criteria upon which an enterprise zone may be based, authorizes a
joint powers authority to administer an enterprise zone, and requires the Trade and
Commerce Agency to provide special consideration or bonus points, or both, to
enterprise zone applications meeting at least two of specified demographic criteria.
Special consideration to applications will be given to applicants from jurisdictions that
meet at least two of the following: 1) at least 17.5 percent of the households within the
proposed enterprise zone area are below the poverty level; 2) the unemployment rate
for the proposed enterprise zone area is at least 7.5 percent immediately prior to
application; and 3) the jurisdiction has a "unique distress factor" such as resource
depletion, plant closure, industry recession, natural disaster or base closure.
Redevelopment, Territorial Jurisdictions. SB 1375 (Alarcon), Chapter 610, Statutes
of 2000. This measure provides that the territorial jurisdiction of the redevelopment
agency of a city over a project area within territory subsequently annexed to another city
or included within the boundaries of a new city remains with the city redevelopment
agency unless the territorial jurisdiction is transferred to the redevelopment agency of
the other city pursuant to the specified procedures. The legislation revises those
procedures to include transfers of territory from city redevelopment agencies to
redevelopment agencies of other cities.
TELECOMMUNICATIONS
Universal Telephone Services. SB 1712 (Polanco), Chapter 943, Statutes of 2000.
Current law establishes a lifeline telephone service program that provides discounted
basic telephone service rates for low-income telephone customers. This legislation
adds findings and declarations stating that it is the intent of the Legislature that the
California Public Utilities Commission (CPUC) redefines universal telephone service by
incorporating two-way voice, video, and data service as components of basic service.
Statutes of 2000
Page 9 of 9
Taxation. State Board of Equalization. AB 2898 (Committee on Revenue and
Taxation), Chapter 1052, Statutes of 2000. This measure conforms to federal and state
income tax law by authorizing the State Board of Equalization to relieve an innocent
spouse under procedures prescribed by the Board, if, in light of all the facts and
circumstances, it is inequitable to hold that spouse liable for any unpaid tax or any
deficiency attributable to any item for which relief is not otherwise available for such
taxes and fees such as Sales and Use Taxes, Motor Vehicle Fuel and Cigarette Taxes.
Taxation, Lottery Winnings. SB 2173 (Committee on Revenue and Taxation), Chapter
180, Statutes of 2000. This legislation ensures that Lottery winners who transfer their
rights to future lottery payments in exchange for lump -sum payouts are not subject to
state or local taxation on their accelerated prize payments.
Booking Fees. State Reimbursements. AB 2219 (Baffin), Chapter 1076, Statutes of
2000. Last year a continuous appropriation provision not to exceed $50 million was
established for the booking fees cities paid to counties. This legislation adds booking
fees paid by cities to other cities to the appropriation. To qualify, cities had to file a
claim with the State Controller's office by October 1, 2000.
Booking Fees. Annual Appropriation. SB 225 (Rainey), Chapter 1075, Statutes of
2000. Last year the Legislature approved a continuous appropriation to cities for
reimbursement of booking fees paid to counties. To qualify, cities were required to file a
claim with the State Controller's office by a certain date. This measure gives those
cities that did not file or filed late, a window of opportunity to qualify for this
appropriation. The deadline for filing with the Controller's office is October 1, 2000.
This legislation was double -joined with AB 2219 that added fees paid to other cities.
These appropriations are on going and do not have. an escalator provision.
Local Government Assessment .Ballots. SB 1477 (Lewis), Chapter 220, Statutes of
2000. This measure establishes certain safeguards in the tabulation of mailed
assessment ballots. Following Proposition 218, the Legislature adopted certain
procedures of notice, hearing and protests on benefit assessments proposals. This
legislation requires that mailed ballots be designed so the returned document can be
sealed. The sealed ballot must remain sealed until the required public hearing is
concluded and then an impartial party, which may be the agency clerk, shall tabulate the
ballots. The ballots themselves shall become "disclosable public records" available to
both opponents and proponents.
COMMUNITY AND ECONOMIC DEVELOPMENT
Downtown Rebound Program. AB 2870 (Cedillo), Chapter 83, Statutes of 2000. This
measure requires the Department of Housing and Community Development to make
grants and loans for specified downtown rebound projects and related planning. Eligible
projects include residential infill projects, adaptive reuse of underutilized commercial and
industrial structures, and the development of high -density housing adjacent to rail
stations. The 2000-2001 budget appropriates $25 million for this program.
$2.4 million of this amount is targeted to support local government planning in any of
three categories: 1) facilitating infill housing by conducting site inventories and other
Statutes of 2000
Page 11 of 11 01
measures; 2) planning, including related general plan updates and zoning ordinances;
and 3) assisting owners of qualified adaptive reuse obtain seismic and feasibility studies.
Enterprise Zones. SB 511 (Alarcon), Chapter 616, Statutes of 2000. This measure
provides that when (and if) new enterprise zones (EZ) are approved by the Legislature,
the Trade and Commerce Agency must give special consideration to applications from
jurisdictions that meet at least two of the following: 1) at least 17.5 percent of the
households within the proposed enterprise zone areas are below the poverty level; 2)
the unemployment rate for the proposed enterprise zone area is at least 7.5 percent
immediately prior to application; and 3) the jurisdiction has a "unique distress factor"
such as resource depletion, plant closure, industry recession, natural disaster or base
closure.
The measure ensures that the eligibility criteria to apply for an EZ adequately serve rural
areas by allowing a community to apply if they meet two of the following criteria: 1) have
an unemployment rate at least three percent greater than the statewide average; 2)
have more than 70 percent of their school children enrolled in the free lunch program;
and 3) the median household income is less than 80 percent of the statewide average.
The measure also provides for the designation of joint powers authority to administer the
EZ, and allows enterprise zone expansions to cross any jurisdictional boundaries.
School Facilities. Joint -Use Project. SB 1795 (Alpert), Chapter 753, Statutes of
2000. This measure authorizes the State Allocation Board (SAB) to fund joint -use
projects to construct libraries, multipurpose rooms, and gymnasiums on school
campuses where these facilities would be used for both school and community
purposes, if specified conditions are met, and authorizes the board to adopt related
funding priority regulations. Legislative estimates indicate that approximately $100
million may be available from the SAB to fund these joint -use facilities.
California Infrastructure and Economic Development Bank. SB 1758 (Peace),
Chapter 1079, Statutes of 2000. This measure adds to the list of "public development
facilities" which are eligible for funding through the Infrastructure Bank projects providing
water supply services. The measure also specifies that an applicant sponsor is not
required to have ownership interest in the project that will be funded.
Military Base Reuse. SB 1538 (Knight), Chapter 769, Statutes of 2000. This measure
extends the sunset date to January 1, 2007, for existing law that designates a single
reuse entity for certain specified military bases subject to closure pursuant 'to the federal
Defense Base Closure and Realignment Act, and specifies a procedure for the
recognition of a single local reuse entity for any military base that is closed in the state.
School Bonds. Fifty-five Percent Vote. AB 1908 (Lempert), Chapter 44, Statutes of
2000. This measure contains implementing language for Proposition 39, the 55 percent
Vote for Local School Bonds initiative, at the November 7, 2000 General Election.
Specifically, this legislation authorizes the governing board of a school district or
community college district, following a two/thirds vote of the governing board, to pursue
the authorization and issuance of bonds by a 55 percent vote of the electorate, at
primary or general elections, or a statewide special election. This measure will only take
effect if the voters approve Proposition 39.
Statutes of 2000
Page 12 of 12
Assembly Bill No. 943
CHAPTER 687
An act to amend Sections 8855 and 53646 of the Government Code,
relating to the California Debt and Investment Advisory
Commission.
[Approved by Governor September 25, 2000. Filed
with Secretary of State September 27, 2000.)
LEGISLATIVE COUNSEL'S DIGEST
AB 943, Dutra. California Debt and Investment Advisory
Commission.
(1) Existing law establishes a 9-member California Debt and
Investment Advisory Commission and prescribes the duties of that
commission, including the requirement that the commission collect,
maintain, and provide comprehensive information on all state and all
local debt authorization, sold and outstanding. It requires the
commission to prepare an annual report compiling and detailing the
total amount of outstanding state and local public debt and
examining recent trends in the composition of that debt.
Existing law requires the treasurer or chief fiscal officer of a local
agency to render annually a statement of investment policy to the
legislative body of the local agency, as well as to any oversight
committee. This officer is also required to render quarterly reports
regarding the financial assets of the local agency to the legislative
body, the chief executive officer, and the internal auditor.
This bill would additionally require each city, county, or city and
county to submit copies of its 2nd and 4th quarterly reports, as well
as the statement of investment policy, to the California Debt and
Investment Advisory Commission. The bill would exempt a city from
the reporting requirement if it has maintained 100% of its investment
portfolio in the county treasury, the Local Agency Investment Fund,
other specified investments, or a combination thereof, and would
exempt a county or city and county that maintained 100% of its
investment portfolio in the Local Agency Investment Fund, other
specified investments, or a combination thereof. Any city, county, or
city and county not required to submit a report would be required
to file with the commission a certification that it is not subject to the
reporting requirement. These reporting requirements would impose
new duties on local agencies and therefore would impose a
state -mandated local program.
This bill would require the commission to collect, maintain, and
provide information on local agency investments of public funds and
to receive local government investor portfolio information. It would
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Ch. 687 —2—
also require the commission to report to the Legislature by May 1,
2006, its activities since the inception of the local agency investment
reporting program.
(2) The California Constitution requires the state to' reimburse
local agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement, including the creation of a State Mandates Claims
Fund to pay the costs of mandates that do not exceed $1,000,000
statewide and other procedures for claims whose statewide costs
exceed $1,000,000.
This bill would provide that, if the Commission on State Mandates
determines that , the bill contains costs mandated by the state,
reimbursement for those costs shall be made pursuant to these
statutory provisions.
The people of the State of California do enact as follows:
SECTION 1. Section 8855 of the Government Code is amended
to read:
8855. (a) There is created the California Debt and Investment
Advisory Commission, consisting of nine members, selected as
follows:
(1) The Treasurer, or his or her designee.
(2) The Governor or the Director of Finance.
(3) The Controller, or his or her designee.
(4) Two local government finance officers appointed by the
Treasurer, one each from among persons employed by a county and
by a city or a city and county of this state, experienced in the issuance
and sale of municipal bonds and nominated by associations affiliated
with these agencies.
(5) Two Members of the Assembly appointed by the Speaker of
the Assembly.
(6) Two Members of the Senate appointed by the Senate
Committee on Rules.
(b) (1) The term of office of an appointed member is four years,
but appointed members serve at the pleasure of the appointing
power. In case of a vacancy for any cause, the appointing power shall
make an appointment to become effective immediately for the
unexpired term.
(2) Any legislators appointed to the commission shall meet with
and participate in the activities of the commission to the extent that
the participation is not incompatible with their respective positions
as Members of the Legislature. For purposes of this chapter, the
Members of the Legislature shall constitute a joint interim legislative
committee on the subject of this chapter.
(c) The Treasurer shall serve as chairperson of the commission
and shall preside at meetings of the commission. The commission, on
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or after January 1, 1982, and annually thereafter, shall elect from its
members a vice chairperson and a secretary who shall hold office
until the next ensuing December 31 and shall continue to serve until
their respective successors are elected.
(d) Appointed members of the commission shall not receive a
salary, but shall be entitled to a per diem allowance of fifty dollars
($50) for each day's attendance at a meeting of the commission not
to exceed three hundred dollars ($300) in any month, and
reimbursement for expenses incurred in the performance of their
duties under this chapter, including travel and other necessary
expenses.
(e) The commission shall do all of the following:
(1) Assist all state financing authorities and commissions in
carrying out their responsibilities as prescribed by law, including
assistance with respect to federal legislation pending in Congress.
(2) Upon request of any state or local government units, to assist
them in the planning, preparation, marketing, and sale of new debt
issues to reduce cost and to assist in protecting the issuer's credit.
(3) Collect, maintain, and provide comprehensive information on
all state and all local debt authorization, sold and outstanding, and
serve as a statistical clearinghouse for all state and local debt issues.
This information shall be readily available upon request by any public
official or any member of the public.
(4) Maintain contact with state and municipal bond issuers,
underwriters, credit rating agencies, investors, and others to improve
the market for state and local government debt issues.
(5) Undertake or commission studies on methods to reduce the
costs and improve credit ratings of state and local issues.
(6) Recommend changes in state laws and local practices to
improve the sale and servicing of state and local debts.
(7) Establish a continuing education program for local officials
having direct or supervisory responsibility over municipal
investments, and undertake other activities conducive to the
disclosure of investment practices and strategies for oversight
purposes.
(8) Collect, maintain, and provide information on local agency
investments of public funds for local agency investment.
(f) The city, county, or city and county investor of any public
funds, no later than 60 days after the close of the second and fourth
quarters of each calendar year, shall provide the quarterly reports
required pursuant to Section 53646 and, no later than 60 days after
the close of the quarter of each calendar year and 60 days after the
subsequent amendment thereto, provide the statement of
investment policy required pursuant to Section 53646, to the
commission by mail, postage prepaid, or by any other method
approved by the commission. The commission shall collect these
reports to further its educational responsibilities as described under
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Ch. 687 — 4 —
subdivision (e). Nothing in this section shall be construed to create
additional oversight responsibility for the commission or any of its
members. Sole responsibility for control, oversight, and
accountability of local investment decisions shall remain with local
officials. The commission shall not be considered to have any
fiduciary duty with respect to any local agency income report
received under this subdivision. In addition, the commission shall not
have any legal liability with respect to these investments.
(g) The commission may adopt bylaws for the regulation of its
affairs and the conduct of its business.
(h) The issuer of any proposed new debt issue of state or local
government shall, no later than 30 days prior to the sale of any debt
issue at public or private sale, give written notice of the proposed sale
to the commission, by mail, postage prepaid. This subdivision shall
also apply to any nonprofit public benefit corporation incorporated
for the purpose of acquiring student loans.
(i) The notice shall include the proposed sale date, the name of the
issuer, the type of debt issue, and the estimated principal amount
thereof. Failure to give this notice shall not affect the validity of the
sale.
0) The issuer of any new debt issue of state or local government,
not later than 45 days after the signing of the bond purchase contract
in a negotiated or private financing, or after the acceptance of a bid
in a competitive offering, shall submit a report of final sale to the
commission by mail, postage prepaid, or by any other method
approved by the commission. A copy of the final official statement for
the issue shall accompany the report of final sale. The commission
may require information to be submitted in the report of final sale
that it considers appropriate.
(k) The commission shall publish a monthly newsletter describing
and evaluating the operations of the commission during the
preceding month.
(l) The commission shall meet on the call of the chairperson, or
at the request of a majority of the members, or at the request of the
Governor. A majority of all nonlegislative members of the
commission constitutes a quorum for the transaction of business.
(m) All administrative and clerical assistance required by the
commission shall be furnished by the office of the Treasurer.
(n) The commission, no later than May 1, 2006, shall report to the
Legislature describing its activities since the inception of the local
agency investment reporting program regarding the collection and
maintenance of information on local agency investment practices
and how the commission uses that information to fulfill its statutory
goals.
SEC. 2. Section 53646 of the Government Code is amended to
read:
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53646. (a) (1) In the case of county government, the treasurer
shall annually render to the board of supervisors and any oversight
committee a statement of investment policy, which the board shall
review and approve at a public meeting. Any change in the policy
shall also be reviewed and approved by the board at a public meeting.
(2) In the case of any other local agency, the treasurer or chief
fiscal officer of the local agency shall annually render to the
legislative body of that local agency and any oversight committee of
that local agency a statement of investment policy, which the
legislative body of the local agency shall consider at a public meeting.
Any change in the policy shall also be considered by the legislative
body of the local agency at a public meeting.
(b) (1) The treasurer or chief fiscal officer shall render a
quarterly report to the chief executive officer, the internal auditor,
and the legislative body of the local agency. The quarterly report
shall be so submitted within 30 days following the end of the quarter
covered by the report. Except as provided in subdivisions (e) and (f),
this report shall include the type of investment, issuer, date of
maturity par and dollar amount invested on all securities,
investments and moneys held by the local agency, and shall
additionally include a description of any of the local agency's funds,
investments, or programs, that are under the management of
contracted parties, including lending programs. With respect to all
securities held by the local agency, and under management of any
outside party that is not also a local agency or the State of California
Local Agency Investment Fund, the report shall also include a
current market value as of the date of the report, and shall include
the source of this same valuation.
(2) The quarterly report shall state compliance of the portfolio to
the statement of investment policy, or manner in which the portfolio
is not in compliance.
(3) The quarterly report shall include a statement denoting the
ability of the local agency to meet its pool's expenditure
requirements for the next six months, or provide an explanation as
to why sufficient money shall, or may, not be available.
(4) In the quarterly report, a subsidiary ledger of investments may
be used in accordance with accepted accounting practices.
(c) Pursuant to subdivision (b), the treasurer or chief fiscal officer
shall report whatever additional information or data may be required
by the legislative body of the local agency.
(d) The legislative body of a local agency may elect to require the
report specified in subdivision (b) to be made on a monthly basis
instead of quarterly.
(e) For local agency investments that have been placed in the
Local Agency Investment Fund, created by Section 16429.1, in
National Credit Union Share Insurance Fund -insured accounts in a
credit union, in accounts insured or guaranteed pursuant to Section
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Ch. 687 — 6 —
14858 of the Financial Code, or in Federal Deposit Insurance
Corporation -insured accounts in a bank or savings and loan
association, in a county investment pool, or any combination of these,
the treasurer or chief fiscal officer may supply to the governing body,
chief executive officer, and the auditor of the local agency the most
recent statement or statements received by the local agency from
these institutions in lieu of the information required by paragraph (1)
of subdivision (b) regarding investments in these institutions.
(f) The treasurer or chief fiscal officer shall not be required to
render a quarterly report, as required by subdivision (b), to a
legislative body or any oversight committee of a school district or
county office of education for securities, investments, or moneys held
by the school district or county office of education in individual
accounts that are less than twenty-five thousand dollars ($25,000).
(g) Except as provided in subdivisions (h) and (i), each city,
county, or city and county shall submit copies of its second and fourth
quarter reports to the California Debt and Investment Advisory
Commission within 60 days after the close of the second and fourth
quarters of each calendar year. Any city, county, or city and county
not required to submit a report pursuant to subdivision (h) or (i)
shall file with the commission a certification within 60 days of the end
of the second and fourth quarters of the calendar year stating the
distribution and amount of its investment portfolio and that it is
therefore not subject to this reporting requirement. This subdivision
shall become inoperative on January 1, 2007.
(h) A city shall not be required to submit a quarterly report to the
commission if, during the entire reporting period, the city has
maintained 100 percent of its investment portfolio in (1) the treasury
of the county in which it is located for investment by the county
treasurer pursuant to Section 53684, (2) the Local Agency
Investment Fund created by Section 16429.1, (3) National Credit
Union Share Insurance Fund -insured accounts in a credit union, in
accounts insured or guaranteed pursuant to Section 14858 of the
Financial Code, or in Federal Deposit Insurance
Corporation -insured accounts in a bank or savings and loan
association, or (4) in any combination of these.
(i) A county or city and county shall not be required to submit a
quarterly report to the commission if, during the entire reporting
period, the county has maintained 100 percent of its investment
portfolio in (1) the Local Agency Investment Fund created by
Section 16429.1, (2) National Credit Union Share Insurance
Fund -insured accounts in a credit union, in accounts insured or
guaranteed pursuant to Section 14858 of the Financial Code, or in
Federal Deposit Insurance Corporation -insured accounts in a bank
or savings and loan association, or (3) in any combination of these.
SEC. 3. Notwithstanding Section 17610 of the Government Code,
if the Commission on State Mandates determines that this act
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contains costs mandated by the state, reimbursement to local
agencies and school districts for those costs shall be made pursuant
to Part 7 (commencing with Section 17500) of Division 4 of Title 2 of
the Government Code. If the statewide cost of the claim for
reimbursement does not exceed one million dollars ($1,000,000),
reimbursement shall be made from the State Mandates Claims Fund.
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Assembly Bill No. 2220
CHAPTER 339
An act to amend Sections 53601, 53601.2, 53635, and 53635.2 of the
Government Code, relating to local agency investments.
[Approved by Governor September 6, 2000. Filed
with Secretary of State September 8, 2000.]
LEGISLATIVE COUNSEL'S DIGEST
AB 2220, Battin. Local agency investments.
Under existing law, funds that belong to, or are in the custody of,
a local agency or local agency moneys that are not required for the
immediate necessity of the local agency may be invested in any of
several specified investments. Existing law permits limited purchases
of bankers acceptances that do not exceed 270 days maturity. The
purchase of prime quality commercial paper for those instruments
is also permitted if the eligible commercial paper does not exceed 180
days maturity.
This bill would revise the maximum maturity periods for those
investments to 180 days for bankers acceptances and 270 days for
prime quality commercial paper.
The people of the State of California do enact as follows:
SECTION 1. Section 53601 of the Government Code is amended
to read:
53601. The legislative body of a local agency having money in a
sinking fund of, or surplus money in, its treasury not required for the
immediate needs of the local agency may invest any portion of the
money that it deems wise or expedient in those investments set forth
below. A local agency purchasing or obtaining any securities
prescribed in this section, in a negotiable, bearer, registered, or
nonregistered format, shall require delivery of the securities to the
local agency, including those purchased for the agency by financial
advisers, consultants, or managers using the agency's funds, by book
entry, physical delivery, or by third -party custodial agreement. The
transfer of securities to the counterparty bank's customer book entry
account may be used for book entry delivery.
For purposes of this section "counterparty" means the other party
to the transaction. A counterparty bank's trust department or
separate safekeeping department may be used for the physical
delivery of the security if the security is held in the name of the local
agency. Where this section specifies a percentage limitation for a
particular category of investment, that percentage is applicable only
96
Ch. 339 — 2 —
at the date of purchase. Where this section does not specify a
limitation on the term or remaining maturity at the time of the
investment, no investment shall be made in any security, other. than
a security underlying a repurchase or reverse repurchase agreement
or securities lending agreement authorized by this section, that at the
time of the investment has a term remaining to maturity in excess of
five years, unless the legislative body has granted express authority
to make that investment either specifically or as a part of an
investment program approved by the legislative body no less than
three months prior to the investment:
(a) Bonds issued by the local agency, including bonds payable
solely out of the revenues from a revenue -producing property
owned, controlled, or operated by the local agency or by a
department, board, agency, or authority of the local agency.
(b) United States Treasury notes, bonds, bills, or certificates of
indebtedness, or those for which the faith and credit of the United
States are pledged for the payment of principal and interest.
(c) Registered state warrants or treasury notes or bonds of this
state, including bonds payable solely out of the revenues from a
revenue -producing property owned, controlled, or operated by the
state or'by a department, board, agency, or authority of the state.
(d) Bonds, notes, warrants, or other evidences of indebtedness of
any local agency within this state, including bonds payable solely out
of the revenues from a revenue -producing property owned,
controlled, or operated by the local agency, or by a department,
board, agency, or authority of the local agency.
(e) Obligations issued by banks for cooperatives, federal land
banks, federal intermediate credit banks, federal home loan banks,
the Federal Home Loan Bank Board, the Tennessee Valley
Authority, or in obligations, participations, or other instruments of,
or issued by, or fully guaranteed as to principal and interest by, the
Federal National Mortgage Association; or in guaranteed portions of
Small Business Administration notes; or in obligations, participations,
or other instruments of, or issued by, a federal agency or a United
States government -sponsored enterprise.
(f) Bills of exchange or time drafts drawn on and accepted by a
commercial bank, otherwise known as bankers acceptances.
Purchases of bankers acceptances may not exceed 180 days maturity
or 40 percent of the agency's surplus money that may be invested
pursuant to this section. However, no more than 30 percent of the
agency's surplus funds may be invested in the bankers acceptances
of any one commercial bank pursuant to this section.
This subdivision does not preclude a municipal utility district from
investing any surplus money in its treasury in any manner authorized
by the Municipal Utility District Act (Division 6 (commencing with
Section 11501) of the Public Utilities Code).
96
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(g) Commercial paper of "prime" quality of the highest ranking
or of the highest letter and numerical rating as provided for by
Moody's Investors Service, Inc., or Standard and Poor's Corporation.
Eligible paper is further limited to issuing corporations that are
organized and operating within the United States and having total
assets in excess of five hundred million dollars ($500,000,000) and
having an "A" or higher rating for the issuer's debt, other than
commercial paper, if any, as provided for by Moody's Investors
Service, Inc., or Standard and Poor's Corporation. Purchases of
eligible commercial paper may not exceed 270 days maturity nor
represent more than 10 percent of the outstanding paper of an issuing
corporation. Purchases of commercial paper may not exceed 15
percent of the agency's surplus money that may be invested pursuant
to this section. An additional 15 percent, or a total of 30 percent of the
agency's surplus money, may be invested pursuant to this
subdivision. The additional 15 percent may be so invested only if the
dollar -weighted average maturity of the entire amount does not
exceed 31 days. "Dollar -weighted average maturity" means the sum
of the amount of each outstanding commercial paper investment
multiplied by the number of days to maturity, divided by the total
amount of outstanding commercial paper.
(h) Negotiable certificates of deposits issued by a nationally or
state -chartered bank or a state or federal association (as defined by
Section 5102 of the Financial Code) or by a state -licensed branch of
a foreign bank. Purchases of negotiable certificates of deposit may
not exceed 30 percent of the agency's surplus money which may be
invested pursuant to this section. For purposes of this section,
negotiable certificates of deposits do not come within Article 2
(commencing with Section 53630), except that the amount so
invested shall be subject to the limitations of Section 53638.
(i) (1) Investments in repurchase agreements or reverse
repurchase agreements or securities lending agreements of any
securities authorized by this section, as long as the agreements are
subject to this subdivision, including, the delivery requirements
specified in this section.
(2) Investments in repurchase agreements may be made, on any
investment authorized in this section, when the term of the
agreement does not exceed one year. The market value of securities
that underlay a repurchase agreement shall be valued at 102 percent
or greater of the funds borrowed against those securities and the
value shall be adjusted no less than quarterly. Since the market value
of the underlying securities is subject to daily market fluctuations, the
investments in repurchase agreements shall be in compliance if the
value of the underlying securities is brought back up to 102 percent
no later than the next business day.
96
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Ch. 339 — 4 —
(3) Reverse repurchase agreements or securities . lending
agreements may be utilized only when either of the following
conditions are met:
(A) The security was owned or specifically committed to
purchase, by the local agency, prior to December 31, 1994, and was
sold using a reverse repurchase agreement or securities lending
agreement on December 31, 1994.
(B) The security to be sold on reverse repurchase agreement or
securities lending agreement has been owned and fully paid for by
the local agency for a minimum of 30 days prior to sale; the total of
all reverse repurchase agreements and securities lending
agreements on investments owned by the local agency not purchased
or committed to purchase, prior to December 31, 1994, does not
exceed 20 percent of the base value of the portfolio; and the
agreement does not exceed a term of 92 days, unless the agreement
includes a written codicil guaranteeing a minimum earning or spread
for the entire period between the sale of a security using a reverse
repurchase agreement or securities lending agreement and the final
maturity date of the same security.
(4) After December 31, 1994, a reverse repurchase agreement or
securities lending agreement may not be entered into with securities
not sold on a reverse repurchase agreement or securities lending
agreement and purchased, or committed to purchase, prior to that
date, as a means of financing or paying for the security sold on a
reverse repurchase agreement or securities lending agreement, but
may only be entered into with securities owned and previously paid
for a minimum of 30 days prior to the settlement of the reverse
repurchase agreement or securities lending agreement, in order to
supplement the yield on securities owned and previously paid for or
to provide funds for the immediate payment of a local agency
obligation. Funds obtained or funds within the pool of an equivalent
amount to that obtained from selling a security to a counterparty by
way of a reverse repurchase agreement or securities lending
agreement, on securities originally purchased subsequent to
December 31, 1994, shall not be used to purchase another security
with a maturity longer than 92 days from the initial settlement date
of the reverse repurchase agreement . or securities lending
agreement, unless the reverse repurchase agreement or securities
lending agreement includes a written codicil guaranteeing a
minimum earning or spread for the entire period between the sale
of a security using a reverse repurchase agreement or securities
lending agreement and the final maturity date of the same security.
Reverse repurchase agreements or securities lending agreements
specified in subparagraph (B) of paragraph (3) may not be entered
into unless the percentage restrictions specified in that subparagraph
are met, including the total of any reverse repurchase agreements or
96
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— 5 — Ch. 339
securities lending agreements specified in subparagraph (A) of
paragraph (3).
(5) Investments in reverse repurchase agreements, securities
lending agreements, or similar investments in which the local agency
sells securities prior to purchase with a simultaneous agreement to
repurchase the security, may only be made upon prior approval of
the governing body of the local agency and shall only be made with
primary dealers of the Federal Reserve Bank of New York.
(6) (A) "Repurchase agreement" means a purchase of securities
by the local agency pursuant to an agreement by which the
counterparty seller will repurchase the securities on or before a
specified date and for a specified amount and the counterparty will
deliver the underlying securities to the local agency by book entry,
physical delivery, or by third -party custodial agreement. The transfer
of underlying securities to the counterparty bank's customer
book -entry account may be used for book -entry delivery.
(B) "Securities," for purpose of repurchase under this subdivision,
means securities of the same issuer, description, issue date, and
maturity.
(C) "Reverse repurchase agreement" means a sale of securities by
the local agency pursuant to an agreement by which the local agency
will repurchase the securities on or before a specified date and
includes other comparable agreements.
(D) "Securities lending agreement" means an agreement under
which a local agency agrees to transfer securities to a borrower who,
in turn, agrees to provide collateral to the local agency. During the
term of the agreement, both the securities and the collateral are held
by a third party. At the conclusion of the agreement, the securities
are transferred back to the local agency in return for the collateral.
(E) For purposes of this section, the base value of the local
agency's pool portfolio shall be that dollar amount obtained by
totaling all cash balances placed in the pool by all pool participants,
excluding any amounts obtained through selling securities by way of
reverse repurchase agreements, securities lending agreements, or
other similar borrowing methods.
(F) For purposes of this section, the spread is the difference
between the cost of funds obtained using the reverse repurchase
agreement and the earnings obtained on the reinvestment of the
funds.
0) Medium -term notes, defined as all corporate and depository
institution debt securities with a maximum remaining maturity of
five years or less, issued by corporations organized and operating
within the United States or by depository institutions licensed by the
United States or any state and operating within the United States.
Notes eligible for investment under this subdivision shall be rated
"A" or better by a nationally recognized rating service. Purchases of
medium -term notes shall not include other instruments authorized
96
IN
Ch. 339 — 6 —
by this section and may not exceed 30 percent of the agency's surplus
money which may be invested pursuant to this section.
(k) (1) Shares of beneficial interest issued by diversified
management companies that invest in the securities and obligations
as authorized by subdivisions (a) to 0), inclusive, or subdivisions (m)
or (n) and that comply with the investment restrictions of this article
and Article 2 (commencing with Section 53630). However,
notwithstanding these restrictions, a counterparty to a reverse
repurchase agreement or securities lending agreement is not
required to be a primary dealer of the Federal Reserve Bank of New
York if the company's board of directors finds that the counterparty
presents a minimal risk of default, and the value of the securities
underlying a repurchase agreement or securities lending agreement
may be 100 percent of the sales price if the securities are marked to
market daily.
(2) Shares of beneficial interest issued by diversified management
companies that are money market funds registered with the
Securities and Exchange Commission under the Investment
Company Act of 1940 (15 U.S.C. Sec. 80a-1 and following).
(3) If investment is in shares issued pursuant to paragraph (1), the
company shall have met either of the following criteria:
(A) Attained the highest ranking or the highest letter and
numerical rating provided by not less than two nationally recognized
statistical rating organizations.
(B) Retained an investment adviser registered or exempt from
registration with the Securities and Exchange Commission with not
less than five years' experience investing in the securities and
obligations authorized by subdivisions (a) to 0), inclusive, or
subdivisions (m) or (n) and with assets under management in excess
of five hundred million dollars ($500,000,000).
(4) If investment is in shares issued pursuant to paragraph (2), the
company shall have met either of the following criteria:
(A) Attained the highest ranking or the highest letter and
numerical rating provided by not less than two nationally recognized
statistical rating organizations.
(B) Retained an investment adviser registered or exempt from
registration with the Securities and Exchange Commission with not
less than five years' experience managing money market mutual
funds with assets under management in excess of five hundred
million dollars ($500,000,000).
(5) The purchase price of shares of beneficial interest purchased
pursuant to this subdivision shall not include any commission that the
companies may charge and shall not exceed 20 percent of the
agency's surplus money that may be invested pursuant to this section.
However, no more than 10 percent of the agency's surplus funds may
be invested in shares of beneficial interest of any one mutual fund
pursuant to paragraph (1).
96
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(l) Notwithstanding anything to the contrary contained in this
section, Section 53635, or any other provision of law, moneys held by
a trustee or fiscal agent and pledged to the payment or security of
bonds or other indebtedness, or obligations under a lease, installment
sale, or other agreement of a local agency, or certificates of
participation in those bonds, indebtedness, or lease installment sale,
or other agreements, may be invested in accordance with the
statutory provisions governing the issuance of those bonds,
indebtedness, or lease installment sale, or other agreement, or to the
extent not inconsistent therewith or if there are no specific statutory
provisions, in accordance with the ordinance, resolution, indenture,
or agreement of the local agency providing for the issuance.
(m) Notes, bonds, or other obligations that are at all times secured
by a valid first priority security interest in securities of the types listed
by Section 53651 as eligible securities for the purpose of securing local
agency deposits having a market value at least equal to that required
by Section 53652 for the purpose of securing local agency deposits.
The securities serving as collateral shall be placed by delivery or book
entry into the custody of a trust company or the trust department of
a bank which is not affiliated with the issuer of the secured obligation,
and the security interest shall be perfected in accordance with the
requirements of the Uniform Commercial Code or federal
regulations applicable to the types of securities in which the security
interest is granted.
(n) Any mortgage passthrough security, collateralized mortgage
obligation, mortgage -backed or other pay -through bond, equipment
lease -backed certificate, consumer receivable passthrough
certificate, or consumer receivable -backed bond of a maximum of
five years maturity. Securities eligible for investment under this
subdivision shall be issued by an issuer having an "A" or higher rating
for the issuer's debt as provided by a nationally recognized rating
service and rated in a rating category of "AA' or its equivalent or
better by a nationally recognized rating service. Purchase of
securities authorized by this subdivision may not exceed 20 percent
of the agency's surplus money that may be invested pursuant to this
section.
SEC. 2. Section 53601.2 of the Government Code is amended to
read:
53601.2. Notwithstanding subdivision (g) of Section 53601, the
board of supervisors of a county may invest in commercial paper of
"prime" quality of the highest ranking or of the highest letter and
numerical rating as provided for by Moody's Investors Service, Inc.,
or Standard and Poor's Corporation. Eligible paper is further limited
to issuing corporations that are organized and operating within the
United States and have total assets in excess of five hundred million
dollars ($500,000,000) and an "A" or higher rating for the issuer's
debt, other than commercial paper, if any, as provided for by Moody's
96
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�` 1, 7
Ch. 339 — 8 —
Investors Service, Inc., or Standard and Poor's Corporation.
Purchases of eligible commercial paper may not exceed 270 days'
maturity nor represent more than 10 percent of the outstanding
paper of an issuing corporation. Purchases of commercial paper may
not exceed 40 percent of the agency's surplus money that may be
invested pursuant to this section. No more than 10 percent of the
agency's surplus money that may be invested pursuant to this section
may be invested in the outstanding paper of any single issuing
corporation.
SEC. 3. Section 53635 of the Government Code is amended to
read:
53635. As far as possible, all money belonging to, or in the custody
of, a local agency, including money paid to the treasurer or other
official to pay the principal, interest, or penalties of bonds, shall be
deposited for safekeeping in state or national banks, savings
associations or federal associations, credit unions, or federally insured
industrial loan companies in this state selected by the treasurer or
other official having the legal custody of the money; or, unless
otherwise directed by the legislative body pursuant to Section 53601,
may be invested in the investments set forth below. A local agency
purchasing or obtaining any securities described in this section, in a
negotiable, bearer, registered, or nonregistered format, shall require
delivery of all the securities to the local agency, including those
purchased for the agency by financial advisers, consultants, or
managers using the agency's funds, by book -entry, physical delivery,
or by third -party custodial agreement. The transfer of securities to
the counterparty bank's customer book entry account may be used
for book -entry delivery. For purposes of this section, "counterparty"
means the other party to the transaction. A counterparty bank's trust
department or separate safekeeping department may be used for the
physical delivery of the security if the security is held in the name of
the local agency. Where this section specifies a percentage limitation
for a particular category of investment, that percentage is applicable
only at the date of purchase.
(a) Bonds issued by the local agency, including bonds payable
solely out of the revenues from a revenue -producing property
owned, controlled, or operated by the local agency or by a
department, board, agency, or authority of the local agency.
(b) United States Treasury notes, bonds, bills, or certificates of
indebtedness, or those for which the faith and credit of the United
States are pledged for the payment of principal and interest.
(c) Registered state warrants or treasury notes or bonds of this
state, including bonds payable solely out of the revenues from a
revenue -producing property owned, controlled, or operated by the
state or by a department, board, agency, or authority of the state.
(d) Bonds, notes, warrants, or other evidences of indebtedness of
any local agency within this state, including bonds payable solely out
96
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— 9 — Ch. 339
of the revenues from a revenue -producing property owned,
controlled, or operated by the local agency, or by a department,
board, agency, or authority of the local agency.
(e) Obligations issued by banks for cooperatives, federal land
banks, federal intermediate credit banks, federal home loan banks,
the Federal Home Loan Bank, the Tennessee Valley Authority, or in
obligations, participations, or other instruments of, or issued by, or
fully guaranteed as to principal and interest by, the Federal National
Mortgage Association; or in guaranteed portions of Small Business
Administration notes; or in obligations, participations, or other
instruments of, or issued by, a federal agency or a United States
government -sponsored enterprise.
(f) Bills of exchange or time drafts drawn on and accepted by a
commercial bank, otherwise known as bankers acceptances.
Purchases of bankers acceptances may not exceed 180 days maturity
or 40 percent of the agency's surplus funds which may be invested
pursuant to this section. However, no more than 30 percent of the
agency's surplus funds may be invested in the bankers acceptances
of any one commercial bank pursuant to this section.
This subdivision does not preclude a municipal utility district from
investing any surplus money in its treasury in any manner authorized
by the Municipal Utility District Act, Division 6 (commencing with
Section 11501) of the Public Utilities Code.
(g) Commercial paper of "prime" quality of the highest ranking
or of the highest letter and numerical rating as provided for by
Moody's Investors Service, Inc., or Standard and Poor's Corporation.
Eligible paper is further limited to issuing corporations that are
organized and operating within the United States and having total
assets in excess of five hundred million dollars ($500,000,000) and
having an "A" or higher rating for the issuer's debt, other than
commercial paper, if any, as provided for by Moody's Investors
Service, Inc., or Standard and Poor's Corporation. Purchases of
eligible commercial paper may not exceed 270 days maturity nor
represent more than 10 percent of the outstanding paper of an issuing
corporation. Purchases of commercial paper may not exceed 15
percent of the agency's surplus money which may be invested
pursuant to this section. An additional 15 percent, or a total of 30
percent of the agency's money or money in its custody, may be
invested pursuant to this subdivision. The additional 15 percent may
be so invested only if the dollar -weighted average maturity of the
entire amount does not exceed 31 days. "Dollar -weighted average
maturity" means the sum of the amount of each outstanding
commercial paper investment multiplied by the number of days to
maturity, divided by the total amount of outstanding commercial
paper.
(h) Negotiable certificates of deposit issued by a nationally or
state -chartered bank or a savings association or federal association or
96
Ch. 339 —10 —
a state or federal credit union or by a state -licensed branch of a
foreign bank. Purchases of negotiable certificates of deposit may not
exceed 30 percent of the agency's surplus money which may be
invested pursuant to this section. For purposes of this section,
negotiable certificates of deposit do not come within Article 2
(commencing with Section 53630) of Chapter 4 of Part 1 of Division
2 of Title 5, except that the amount so invested shall be subject to the
limitations of Section 53638. For purposes of this section, the
legislative body of a local agency and the treasurer or other official
of the local agency having legal custody of the money are prohibited
from depositing or investing local agency funds, or funds in the
custody of the local agency, in negotiable certificates of deposit issued
by a state or federal credit union if a member of the legislative body
of the local agency, or an employee of the administrative officer,
manager's office, budget office, auditor -controller's office, or
treasurer's office of the local agency also serves on the board of
directors, or any committee appointed by the board of directors, or
the credit committee or supervisory committee of the state or federal
credit union issuing the negotiable certificates of deposit.
(i) (1) Investments in repurchase agreements or reverse
repurchase agreements, or securities lending agreements of any
securities authorized by this section, so long as the agreements are
subject to this subdivision, including the delivery requirements
specified in this section.
(2) Investments in repurchase agreements or securities lending
agreements may be made, on any investment authorized in this
section, when the term of the agreement does not exceed one year.
The market value of securities that. underlay a repurchase agreement
shall be valued at 102 percent or greater of the funds borrowed
against those securities and the value shall be adjusted no less than
quarterly. Since the market value of the underlying securities is
subject to daily market - fluctuations, the investments in repurchase
agreements shall be in compliance if the value of the underlying
securities is brought back up to 102 percent no later than the next
business day.
(3) Reverse repurchase agreements may be utilized only when
either of the following conditions are met:
(A) The security was owned or specifically committed to
purchase, by the local agency, prior to repurchase agreement on
December 31, 1994, and was sold using a reverse repurchase
agreement or securities lending agreement on December 31, 1994.
(B) The security to be sold on reverse repurchase agreement or
securities lending agreement has been owned and fully paid for by
the local agency for a minimum of 30 days prior to sale; the total of
all reverse repurchase agreements and securities lending
agreements on investments owned by the local agency not purchased
or committed to purchase, prior to December 31, 1994, does not
96
-11— Ch. 339
exceed 20 percent of the base value of the portfolio; and the
agreement does not exceed a term of 92 days, unless the agreement
includes a written codicil guaranteeing a minimum earning or spread
for the entire period between the sale of a security using a reverse
repurchase agreement or securities lending agreement and the final
maturity date of the same security.
(4) After December 31, 1994, a reverse repurchase agreement or
securities lending agreement may not be entered into with securities
not sold on a reverse repurchase agreement or securities lending
agreement and purchased, or committed to purchase, prior to that
date, as a means of financing or paying for the security sold on a
reverse repurchase agreement or securities lending agreement, but
may only be entered into with securities owned and previously paid
for a minimum of 30 days prior to the settlement of the reverse
repurchase agreement or securities lending agreement, in order to
supplement the yield on securities owned and previously paid for or
to provide funds for the immediate payment of a local agency
obligation. Funds obtained or funds within the pool of an equivalent
amount to that obtained from selling a security to a counterparty by
way of a reverse repurchase agreement or securities lending
agreement, on securities originally purchased subsequent to
December 31, 1994, shall not be used to purchase another security
with a maturity longer than 92 days from the initial settlement date
of the reverse repurchase agreement or securities lending
agreement, unless the reverse repurchase agreement or securities
lending agreement includes a written codicil guaranteeing a
minimum earning or spread for the entire period between the sale
of a security using a reverse repurchase agreement or securities
lending agreement and the final maturity date of the same security.
Reverse repurchase agreements or securities lending agreements
specified in subparagraph (B) of paragraph (3) may not be entered
into unless the percentage restrictions specified in that subparagraph
are met, including the total of any reverse repurchase agreements or
securities lending agreements specified in subparagraph (A) of
paragraph (3).
(5) Investments in reverse repurchase agreements, securities
lending agreements, or similar investments in which the local agency
sells securities prior to purchase with a simultaneous agreement to
repurchase the security, may only be made upon prior approval of
the governing body of the local agency and shall only be made with
primary dealers of the Federal Reserve Bank of New York.
(6) (A) "Repurchase agreement" means a purchase of securities
by the local agency pursuant to an agreement by which the
counterparty seller will repurchase the securities on or before a
specified date and for a specified amount and the counterparty will
deliver the underlying securities to the local agency by book entry,
physical delivery, or by third -party custodial agreement. The transfer
�Tvi
Ch. 339 —12 —
of underlying securities to the counterparty bank's customer
book -entry account may be used for book -entry delivery.
(B) "Securities," for purpose of repurchase under this subdivision,
means securities of the same issuer, description, issue date, and
maturity.
(C) "Reverse repurchase agreement" means a sale of securities by
the local agency pursuant to an agreement by which the local agency
will repurchase the securities on or before a specified date, and
includes other comparable agreements.
(D) "Securities lending agreement" means an agreement under
which a local agency agrees to transfer securities to a borrower who,
in turn, agrees to provide collateral to the local agency. During the
term of the agreement, both the securities and the collateral are held
by a third party. At the conclusion of the agreement, the securities
are transferred back to the local agency in return for the collateral.
(E) For purposes of this section, the base value of the local
agency's pool portfolio shall be that dollar amount obtained by
totaling all cash balances placed in the pool by all pool participants,
excluding any amounts obtained through selling securities by way of
reverse repurchase agreements or other similar borrowing methods.
(F) For purposes of this section, the spread is the difference
between the cost of funds obtained using the reverse repurchase
agreement or securities lending agreement and the earnings
obtained on the reinvestment of the funds.
0) Medium -term notes, defined as all corporate and depository
institution debt securities with a maximum remaining maturity of
five years or less, issued by corporations organized and operating
within the United States or by depository institutions licensed by the
United States or any state and operating within the United States.
Notes eligible for investment under this subdivision shall be rated
"A" or better by a nationally recognized rating service. Purchases of
medium -term notes shall not include other instruments authorized
by this section and may not exceed 30 percent of the agency's surplus
money which may be invested pursuant to this section.
(k) (1) Shares of beneficial interest issued by diversified
management companies that invest in the securities and obligations
as authorized by subdivisions (a) to 0), inclusive, or subdivision (l)
or (m) and that comply with the investment restrictions of this article
and Article 1 (commencing with Section 53600). However,
notwithstanding these restrictions, a counterparty to a reverse
repurchase agreement or securities lending agreement is not
required to be a primary dealer of the Federal Reserve Bank of New
York if the company's board of directors finds that the counterparty
presents a minimal risk of default, and the value of the securities
underlying a repurchase agreement or securities lending agreement
may be 100 percent of the sales price if the securities are marked to
market daily.
96
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-13 — Ch. 339
(2) Shares of beneficial interest issued by diversified management
companies that are money market funds registered with the
Securities and Exchange Commission under the Investment
Company Act of 1940 (15 U.S.C. Sec. 80a-1 and following).
(3) If investment is in shares issued pursuant to paragraph (1), the
company shall have met either of the following criteria:
(A) Attained the highest ranking or the highest letter and
numerical rating provided by not less than two nationally recognized
statistical rating organizations.
(B) Retained an investment adviser registered or exempt from
registration with the Securities and Exchange Commission with not
less than five years' experience investing in the securities and
obligations authorized by subdivisions (a) to 0), inclusive, or
subdivision (l) or (m) and with assets under management in excess
of five hundred million dollars ($500,000,000).
(4) If investment is in shares issued pursuant to paragraph (2), the
company shall have met either of the following criteria:
(A) Attained the highest ranking or the highest letter and
numerical rating provided by not less than two nationally recognized
statistical rating organizations.
(B) Retained an investment adviser registered or exempt from
registration with the Securities and Exchange Commission with not
less than five years' experience managing money market mutual
funds with assets under management in excess of five hundred
million dollars ($500,000,000).
(5) The purchase price of shares of beneficial interest purchased
pursuant to this subdivision shall not include any commission that the
companies may charge and shall not exceed 20 percent of the
agency's surplus money that may be invested pursuant to this section.
However, no more than 10 percent of the agency's surplus funds may
be invested in shares of beneficial interest of any one mutual fund
pursuant to paragraph (1).
(l) Notes, bonds, or other obligations which are at all times
secured by a valid first priority security interest in securities of the
types listed by Section 53651 as eligible securities for the purpose of
securing local agency deposits having a market value at least equal
to that required by Section 53652 for the purpose of securing local
agency deposits. The securities serving as collateral shall be placed
by delivery or book entry into the custody of a trust company or the
trust department of a bank which is not affiliated with the issuer of
the secured obligation, and the security interest shall be perfected in
accordance with the requirements of the Uniform Commercial Code
or federal regulations applicable to the types of securities in which
the security interest is granted.
(m) Any mortgage passthrough security, collateralized mortgage
obligation, mortgage -backed or other pay -through bond, equipment
lease -backed certificate, consumer receivable passthrough
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Ch. 339 —14 —
certificate, or consumer receivable -backed bond of a maximum of
five years maturity. Securities eligible for investment under this
subdivision shall be issued by an issuer having an "A" or higher rating
for the issuer's debt as provided by a nationally recognized rating
service and rated in a rating category of "AA" or its equivalent or
better by a nationally recognized rating service. Purchase of
securities authorized by this subdivision may not exceed 20 percent
of the agency's surplus money that may be invested pursuant to this
section.
SEC. 4. Section 53635.2 of the Government Code is amended to
read:
53635.2. Notwithstanding subdivision (g) of Section 53635, the
board of supervisors of a county may invest in commercial paper of
"prime" quality of the highest ranking or of the highest letter and
numerical rating as provided for by Moody's Investors Service, Inc.,
or Standard and Poor's Corporation. Eligible paper is further limited
to issuing corporations that are organized and operating within the
United States and have total assets in excess of five hundred million
dollars ($500,000,000) and an "A" or higher rating for the issuer's
debt, other than commercial paper, if any, as provided for by Moody's
Investors Service, Inc., or Standard and Poor's Corporation.
Purchases of eligible commercial paper may not exceed 270 days'
maturity nor represent more than 10 percent of the outstanding
paper of an issuing corporation. Purchases of commercial paper may
not exceed 40 percent of the agency's surplus money that may be
invested pursuant to this section. No more than 10 percent of the
agency's surplus money that may be invested pursuant to this section
may be invested in the outstanding paper of any single issuing
corporation.
❑C
96
J
Assembly Bill No. 943
CHAPTER 687
An act to amend Sections 8855 and 53646 of the Government Code,
relating to the California Debt and Investment Advisory
Commission.
[Approved by Governor September 25, 2000. Filed
with Secretary of State September 27, 2000.]
LEGISLATIVE COUNSEL'S DIGEST
AB 943, Dutra. California Debt and Investment Advisory
Commission.
(1) Existing law establishes a 9-member California Debt and
Investment Advisory Commission and prescribes the duties of that
commission, including the requirement that the commission collect,
maintain, and provide comprehensive information on all state and all
local debt authorization, sold and outstanding. It requires the
commission to prepare an annual report compiling and detailing the
total amount of outstanding state and local public debt and
examining recent trends in the composition of that debt.
Existing law requires the treasurer or chief fiscal officer of a local
agency to render annually a statement of investment policy to the
legislative body of the local agency, as well as to any oversight
committee. This officer is also required to render quarterly reports
regarding the financial assets of the local agency to the legislative
body, the chief executive officer, and the internal auditor.
This bill would additionally require each city, county, or city and
county to submit copies of its 2nd and 4th quarterly reports, as well
as the statement of investment policy, to the California Debt and
Investment Advisory Commission. The bill would exempt a city from
the reporting requirement if it has maintained 100% of its investment
portfolio in the county treasury, the Local Agency Investment Fund,
other specified investments, or a combination thereof, and would
exempt a county or city and county that maintained 100% of its
investment portfolio in the Local Agency Investment Fund, other
specified investments, or a combination thereof. Any city, county, or
city and county not required to submit a report would be required
to file with the commission a certification that it is not subject to the
reporting requirement. These reporting requirements would impose
new duties on local agencies and therefore would impose a
state -mandated local program.
This bill would require the commission to collect, maintain, and
provide information on local agency investments of public funds and
to receive local government investor portfolio information. It would
91
Ch. 687 —2—
also require the commission to report to the Legislature by May 1,
2006, its activities since the inception of the local agency investment
reporting program.
(2) The California Constitution requires the state to reimburse
local agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement, including the creation of a State Mandates Claims
Fund to pay the costs of mandates that do not exceed $1,000,000
statewide and other procedures for claims whose statewide costs
exceed $1,000,000.
This bill would provide that, if the Commission on State Mandates
determines that the bill contains costs mandated by the state,
reimbursement for those costs shall be made pursuant to these
statutory provisions.
The people of the State of California do enact as follows:
SECTION 1. Section 8855 of the Government Code is amended
to read:
8855. (a) There is created the California Debt and Investment
Advisory Commission, consisting of nine members, selected as
follows:
(1) The Treasurer, or his or her designee.
(2) The Governor or the Director of Finance.
(3) The Controller, or his or her designee.
(4) Two local government finance officers appointed by the
Treasurer, one each from among persons employed by a county and
by a city or a city and county of this state, experienced in the issuance
and sale of municipal bonds and nominated by associations affiliated
with these agencies.
(5) Two Members of the Assembly appointed by the Speaker of
the Assembly.
(6) Two Members of the Senate appointed by the Senate
Committee on Rules.
(b) (1) The term of office of an appointed member is four years,
but appointed members serve at the pleasure of the appointing
power. In case of a vacancy for any cause, the appointing power shall
make an appointment to become effective immediately for the
unexpired term.
(2) Any legislators appointed to the commission shall meet with
and participate in the activities of the commission to the extent that
the participation is not incompatible with their respective positions
as Members of the Legislature. For purposes of this chapter, the
Members of the Legislature shall constitute a joint interim legislative
committee on the subject of this chapter.
(c) The Treasurer shall serve as chairperson of the commission
and shall preside at meetings of the commission. The commission, on
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— 3 — Ch. 687
or after January 1, 1982, and annually thereafter, shall elect from its
members a vice chairperson and a secretary who shall hold office
until the next ensuing December 31 and shall continue to serve until
their respective successors are elected.
(d) Appointed members of the commission shall not receive a
salary, but shall be entitled to a per diem allowance of fifty dollars
($50) for each day's attendance at a meeting of the commission not
to exceed three hundred dollars ($300) in any month, and
reimbursement for expenses incurred in the performance of their
duties under this chapter, including travel and other necessary
expenses.
(e) The commission shall do all of the following:
(1) Assist all state financing authorities and commissions in
carrying out their responsibilities as prescribed by law, including
assistance with respect to federal legislation pending in Congress.
(2) Upon request of any state or local government units, to assist
them in the planning, preparation, marketing, and sale of new debt
issues to reduce cost and to assist in protecting the issuer's credit.
(3) Collect, maintain, and provide comprehensive information on
all state and all local debt authorization, sold and outstanding, and
serve as a statistical clearinghouse for all state and local debt issues.
This information shall be readily available upon request by any public
official or any member of the public.
(4) Maintain contact with state and municipal bond issuers,
underwriters, credit rating agencies, investors, and others to improve
the market for state and local government debt issues.
(5) Undertake or commission studies on methods to reduce the
costs and improve credit ratings of state and local issues.
(6) Recommend changes in state laws and local practices to
improve the sale and servicing of state and local debts.
(7) Establish a continuing education program for local officials
having direct or supervisory responsibility over municipal
investments, and undertake other activities conducive to the
disclosure of investment practices and strategies for oversight
purposes.
(8) Collect, maintain, and provide information on local agency
investments of public funds for local agency investment.
(f) The city, county, or city and county investor of any public
funds, no later than 60 days after the close of the second and fourth
quarters of each calendar year, shall provide the quarterly reports
required pursuant to Section 53646 and, no later than 60 days after
the close of the quarter of each calendar year and 60 days after the
subsequent amendment thereto, provide the statement of
investment policy required pursuant to Section 53646, to the
commission by mail, postage prepaid, or by any other method
approved by the commission. The commission shall collect these
reports to further its educational responsibilities as described under
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Ch. 687 — 4 —
subdivision (e). Nothing in this section shall be construed to create
additional oversight responsibility for the commission or any of its
members. Sole responsibility for control, oversight, and
accountability of local investment decisions shall remain with local
officials. The commission shall not be considered to have any
fiduciary duty with respect to any local agency income report
received under this subdivision. In addition, the commission shall not
have any legal liability with respect to these investments.
(g) The commission may adopt bylaws for the regulation of its
affairs and the conduct of its business.
(h) The issuer of any proposed new debt issue of state or local
government shall, no later than 30 days prior to the sale of any debt
issue at public or private sale, give written notice of the proposed sale
to the commission, by mail, postage prepaid. This subdivision shall
also apply to any nonprofit public benefit corporation incorporated
for the purpose of acquiring student loans.
(i) The notice shall include the proposed sale date, the name of the
issuer, the type of debt issue, and the estimated principal amount
thereof. Failure to give this notice shall not affect the validity of the
sale.
0) The issuer of any new debt issue of state or local government,
not later than 45 days after the signing of the bond purchase contract
in a negotiated or private financing, or after the acceptance of a bid
in a competitive offering, shall submit a report of final sale to the
commission by mail, postage prepaid, or by any other method
approved by the commission. A copy of the final official statement for
the issue shall accompany the report of final sale. The commission
may require information to be submitted in the report of final sale
that it considers appropriate.
(k) The commission shall publish a monthly newsletter describing
and evaluating the operations of the commission during the
preceding month.
(l) The commission shall meet on the call of the chairperson, or
at the request of a majority of the members, or at the request of the
Governor. A majority of all nonlegislative members of the
commission constitutes a quorum for the transaction of business.
(m) All administrative and clerical assistance required by the
commission shall be furnished by the office of the Treasurer.
(n) The commission, no later than May 1, 2006, shall report to the
Legislature describing its activities since the inception of the local
agency investment reporting program regarding the collection and
maintenance of information on local agency investment practices
and how the commission uses that information to fulfill its statutory
goals.
SEC. 2. Section 53646 of the Government Code is amended to
read:
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017
— 5 — Ch. 687
53646. (a) (1) In the case of county government, the treasurer
shall annually render to the board of supervisors and any oversight
committee a statement of investment policy, which the board shall
review and approve at a public meeting. Any change in the policy
shall also be reviewed and approved by the board at a public meeting.
(2) In the case of any other local agency, the treasurer or chief
fiscal officer of the local agency shall annually render to the
legislative body of that local agency and any oversight committee of
that local agency a statement of investment policy, which the
legislative body of the local agency shall consider at a public meeting.
Any change in the policy shall also be considered by the legislative
body of the local agency at a public meeting.
(b) (1) The treasurer or chief fiscal officer shall render a
quarterly report to the chief executive officer, the internal auditor,
and the legislative body of the local agency. The quarterly report
shall be so submitted within 30 days following the end of the quarter
covered by the report. Except as provided in subdivisions (e) and (f),
this report shall include the type of investment, issuer, date of
maturity par and dollar amount invested on all securities,
investments and moneys held by the local agency, and shall
additionally include a description of any of the local agency's funds,
investments, or programs, that are under the management of
contracted parties, including lending programs. With respect to all
securities held by the local agency, and under management of any
outside party that is not also a local agency or the State of California
Local Agency Investment Fund, the report shall also include a
current market value as of the date of the report, and shall include
the source of this same valuation.
(2) The quarterly report shall state compliance of the portfolio to
the statement of investment policy, or manner in which the portfolio
is not in compliance.
(3) The quarterly report shall include a statement denoting the
ability of the local agency to meet its pool's expenditure
requirements for the next six months, or provide an explanation as
to why sufficient money shall, or may, not be available.
(4) In the quarterly report, a subsidiary ledger of investments may
be used in accordance with accepted accounting practices.
(c) Pursuant to subdivision (b), the treasurer or chief fiscal officer
shall report whatever additional information or data may be required
by the legislative body of the local agency.
(d) The legislative body of a local agency may elect to require the
report specified in subdivision (b) to be made on a monthly basis
instead of quarterly.
(e) For local agency investments that have been placed in the
Local Agency Investment Fund, created by Section 16429.1, in
National Credit Union Share Insurance Fund -insured accounts in a
credit union, in accounts insured or guaranteed pursuant to Section
91
•
Ch. 687 — 6 —
14858 of the Financial Code, or in Federal Deposit Insurance
Corporation -insured accounts in a bank or savings and loan
association, in a county investment pool, or any combination of these,
the treasurer or chief fiscal officer may supply to the governing body,
chief executive officer, and the auditor of the local agency the most
recent statement or statements received by the local agency from
these institutions in lieu of the information required by paragraph (1)
of subdivision (b) regarding investments in these institutions.
(f) The treasurer or chief fiscal officer shall not be required to
render a quarterly report, as required by subdivision (b), to a
legislative body or any oversight committee of a school district or
county office of education for securities, investments, or moneys held
by the school district or county office of education in individual
accounts that are less than twenty-five thousand dollars ($25,000).
(g) Except as provided in subdivisions (h) and (i), each city,
county, or city and county shall submit copies of its second and fourth
quarter reports to the California Debt and Investment Advisory
Commission within 60 days after the close of the second and fourth
quarters of each calendar year. Any city, county, or city and county
not required to submit a report pursuant to subdivision (h) or (i)
shall file with the commission a certification within 60 days of the end
of the second and fourth quarters of the calendar year stating the
distribution and amount of its investment portfolio and that it is
therefore not subject to this reporting requirement. This subdivision
shall become inoperative on January 1, 2007.
(h) A city shall not be required to submit a quarterly report to the
commission if, during the entire reporting period, the city has
maintained 100 percent of its investment portfolio in (1) the treasury
of the county in which it is located for investment by the county
treasurer pursuant to Section 53684, (2) the Local Agency
Investment Fund created by Section 16429.1, (3) National Credit
Union Share Insurance Fund -insured accounts in a credit union, in
accounts insured or guaranteed pursuant to Section 14858 of the
Financial Code, or in Federal Deposit Insurance
Corporation -insured accounts in a bank or savings and loan
association, or (4) in any combination of these.
(i) A county or city and county shall not be required to submit a
quarterly report to the commission if, during the entire reporting
period, the county has maintained 100 percent of its investment
portfolio in (1) the Local Agency Investment Fund created by
Section 16429.1, (2) National Credit Union Share Insurance
Fund -insured accounts in a credit union, in accounts insured or
guaranteed pursuant to Section 14858 of the Financial Code, or in
Federal Deposit Insurance Corporation -insured accounts in a bank
or savings and loan association, or (3) in any combination of these.
SEC. 3. Notwithstanding Section 17610 of the Government Code,
if the Commission on State Mandates determines that this act
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— 7 — Ch. 687
contains costs mandated by the state, reimbursement to local
agencies and school districts for those costs shall be made pursuant
to Part 7 (commencing with Section 17500) of Division 4 of Title 2 of
the Government Code. If the statewide cost of the claim for
reimbursement does not exceed one million dollars ($1,000,000),
reimbursement shall be made from the State Mandates Claims Fund.
L61
91
IN
01�-0
Assembly Bill No. 2220
CHAPTER 339
An act to amend Sections 53601, 53601.2, 53635, and 53635.2 of the
Government Code, relating to local agency investments.
[Approved by Governor September 6, 2000. Filed
with Secretary of State September 8, 2000.1
LEGISLATIVE COUNSEL'S DIGEST
AB 2220, Battin. Local agency investments.
Under existing law, funds that belong to, or are in the custody of,
a local agency or local agency moneys that are not required for the
immediate necessity of the local agency may be invested in any of
several specified investments. Existing law permits limited purchases
of bankers acceptances that do not exceed 270 days maturity. The
purchase of prime quality commercial paper for those instruments
is also permitted if the eligible commercial paper does not exceed 180
days maturity.
This bill would revise the maximum maturity periods for those
investments to 180 days for bankers acceptances and 270 days for
prime quality commercial paper.
The people of the State of California do enact as follows:
SECTION 1. Section 53601 of the Government Code is amended
to read:
53601. The legislative body of a local agency having money in a
sinking fund of, or surplus money in, its treasury not required for the
immediate needs of the local agency may invest any portion of the
money that it deems wise or expedient in those investments set forth
below. A local agency purchasing or obtaining any securities
prescribed in this section, in a negotiable, bearer, registered, or
nonregistered format, shall require delivery of the securities to the
local agency, including those purchased for the agency by financial
advisers, consultants, or managers using the agency's funds, by book
entry, physical delivery, or by third -party custodial agreement. The
transfer of securities to the counterparty bank's customer book entry
account may be used for book entry delivery.
For purposes of this section "counterparty" means the other party
to the transaction. A counterparty bank's trust department or
separate safekeeping department may be used for the physical
delivery of the security if the security is held in the name of the local
agency. Where this section specifies a percentage limitation for a
particular category of investment, that percentage is applicable only
7�
Ch. 339 — 2 —
at the date of purchase. Where this section does not specify a
limitation on the term or remaining maturity at the time of the
investment, no investment shall be made in any security, other than
a security underlying a repurchase or reverse repurchase agreement
or securities lending agreement authorized by this section, that at the
time of the investment has a term remaining to maturity in excess of
five years, unless the legislative body has granted express authority
to make that investment either specifically or as a part of an
investment program approved by the legislative body no less than
three months prior to the investment:
(a) Bonds issued by the local agency, including bonds payable
solely out of the revenues from a revenue -producing property
owned, controlled, or operated by the local agency or by a
department, board, agency, or authority of the local agency.
(b) United States Treasury notes, bonds, bills, or certificates of
indebtedness, or those for which the faith and credit of the United
States are pledged for the payment of principal and interest.
(c) Registered state warrants or treasury notes or bonds of this
state, including bonds payable solely out of the revenues from a
revenue -producing property owned, controlled, or operated by the
state or by a department, board, agency, or authority of the state.
(d) Bonds, notes, warrants, or other evidences of indebtedness of
any local agency within this state, including bonds payable solely out
of the revenues from a revenue -producing property owned,
controlled, or operated by the local agency, or by a department,
board, agency, or authority of the local agency.
(e) Obligations issued by banks for cooperatives, federal land
banks, federal intermediate credit banks, federal home loan banks,
the Federal Home Loan Bank Board, the Tennessee Valley
Authority, or in obligations, participations, or other instruments of,
or issued by, or fully guaranteed as to principal and interest by, the
Federal National Mortgage Association; or in guaranteed portions of
Small Business Administration notes; or in obligations, participations,
or other instruments of, or issued by, a federal agency or a United
States government -sponsored enterprise.
(f) Bills of exchange or time drafts drawn on and accepted by a
commercial bank, otherwise known as bankers acceptances.
Purchases of bankers acceptances may not exceed 180 days maturity
or 40 percent of the agency's surplus money that may be invested
pursuant to this section. However, no more than 30 percent of the
agency's surplus funds may be invested in the bankers acceptances
of any one commercial bank pursuant to this section.
This subdivision does not preclude a municipal utility district from
investing any surplus money in its treasury in any manner authorized
by the Municipal Utility District Act (Division 6 (commencing with
Section 11501) of the Public Utilities Code).
96
) 4w 2
— 3 — Ch. 339
(g) Commercial paper of "prime" quality of the highest ranking
or of the highest letter and numerical rating as provided for by
Moody's Investors Service, Inc., or Standard and Poor's Corporation.
Eligible paper is further limited to issuing corporations that are
organized and operating within the United States and having total
assets in excess of five hundred million dollars ($500,000,000) and
having an "A" or higher rating for the issuer's debt, other than
commercial paper, if any, as provided for by Moody's Investors
Service, Inc., or Standard and Poor's Corporation. Purchases of
eligible commercial paper may not exceed 270 days maturity nor
represent more than 10 percent of the outstanding paper of an issuing
corporation. Purchases of commercial paper may not exceed 15
percent of the agency's surplus money that may be invested pursuant
to this section. An additional 15 percent, or a total of 30 percent of the
agency's surplus money, may be invested pursuant to this
subdivision. The additional 15 percent may be so invested only if the
dollar -weighted average maturity of the entire amount does not
exceed 31 days. "Dollar -weighted average maturity" means the sum
of the amount of each outstanding commercial paper investment
multiplied by the number of days to maturity, divided by the total
amount of outstanding commercial paper.
(h) Negotiable certificates of deposits issued by a nationally or
state -chartered bank or a state or federal association (as defined by
Section 5102 of the Financial Code) or by a state -licensed branch of
a foreign bank. Purchases of negotiable certificates of deposit may
not exceed 30 percent of the agency's surplus money which may be
invested pursuant to this section. For purposes of this section,
negotiable certificates of deposits do not come within Article 2
(commencing with Section 53630), except that the amount so
invested shall be subject to the limitations of Section 53638.
(i) (1) Investments in repurchase agreements or reverse
repurchase agreements or securities lending agreements of any
securities authorized by this section, as long as the agreements are
subject to this subdivision, including, the delivery requirements
specified in this section.
(2) Investments in repurchase agreements may be made, on any
investment authorized in this section, when the term of the
agreement does not exceed one year. The market value of securities
that underlay a repurchase agreement shall be valued at 102 percent
or greater of the funds borrowed against those securities and the
value shall be adjusted no less than quarterly. Since the market value
of the underlying securities is subject to daily market fluctuations, the
investments in repurchase agreements shall be in compliance if the
value of the underlying securities is brought back up to 102 percent
no later than the next business day.
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Ch. 339 — 4 —
(3) Reverse repurchase agreements or securities lending
agreements may be utilized only when either of the following
conditions are met:
(A) The security was owned or specifically committed to
purchase, by the local agency, prior to December 31, 1994, and was
sold using a reverse repurchase agreement or securities lending
agreement on December 31, 1994.
(B) The security to be sold on reverse repurchase agreement or
securities lending agreement has been owned and fully paid for by
the local agency for a minimum of 30 days prior to sale; the total of
all reverse repurchase agreements and securities lending
agreements on investments owned by the local agency not purchased
or committed to purchase, prior to December 31, 1994, does not
exceed 20 percent of the base value of the portfolio; and the
agreement does not exceed a term of 92 days, unless the agreement
includes a written codicil guaranteeing a minimum earning or spread
for the entire period between the sale of a security using a reverse
repurchase agreement or securities lending agreement and the final
maturity date of the same security.
(4) After December 31, 1994, a reverse repurchase agreement or
securities lending agreement may not be entered into with securities
not sold on a reverse repurchase agreement or securities lending
agreement and purchased, or committed to purchase, prior to that
date, as a means of financing or paying for the security sold on a
reverse repurchase agreement or securities lending agreement, but
may only be entered into with securities owned and previously paid
for a minimum of 30 days prior to the settlement of the reverse
repurchase agreement or securities lending agreement, in order to
supplement the yield on securities owned and previously paid for or
to provide funds for the immediate payment of a local agency
obligation. Funds obtained or funds within the pool of an equivalent
amount to that obtained from selling a security to a counterparty by
way of a reverse repurchase agreement or securities lending
agreement, on securities originally purchased subsequent to
December 31, 1994, shall not be used to purchase another security
with a maturity longer than 92 days from the initial settlement date
of the reverse repurchase agreement or securities lending
agreement, unless the reverse repurchase agreement or securities
lending agreement includes a written codicil guaranteeing a
minimum earning or spread for the entire period between the sale
of a security using a reverse repurchase agreement or securities
lending agreement and the final maturity date of the same security.
Reverse repurchase agreements or securities lending agreements
specified in subparagraph (B) of paragraph (3) may not be entered
into unless the percentage restrictions specified in that subparagraph
are met, including the total of any reverse repurchase agreements or
96
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-5— Ch. 339
securities lending agreements specified in subparagraph (A) of
paragraph (3).
(5) Investments in reverse repurchase agreements, securities
lending agreements, or similar investments in which the local agency
sells securities prior to purchase with a simultaneous agreement to
repurchase the security, may only be made upon prior approval of
the governing body of the local agency and shall only be made with
primary dealers of the Federal Reserve Bank of New York.
(6) (A) "Repurchase agreement" means a purchase of securities
by the local agency pursuant to an agreement by which the
counterparty seller will repurchase the securities on or before a
specified date and for a specified amount and the counterparty will
deliver the underlying securities to the local agency by book entry,
physical delivery, or by third -party custodial agreement. The transfer
of underlying securities to the counterparty bank's customer
book -entry account may be used for book -entry delivery.
(B) "Securities," for purpose of repurchase under this subdivision,
means securities of the same issuer, description, issue date, and
maturity.
(C) "Reverse repurchase agreement" means a sale of securities by
the local agency pursuant to an agreement by which the local agency
will repurchase the securities on or before a specified date and
includes other comparable agreements.
(D) "Securities lending agreement" means an agreement under
which a local agency agrees to transfer securities to a borrower who,
in turn, agrees to provide collateral to the local agency. During the
term of the agreement, both the securities and the collateral are held
by a third party. At the conclusion of the agreement, the securities
are transferred back to the local agency in return for the collateral.
(E) For purposes of this section, the base value of the local
agency's pool portfolio shall be that dollar amount obtained by
totaling all cash balances placed in the pool by all pool participants,
excluding any amounts obtained through selling securities by way of
reverse repurchase agreements, securities lending agreements, or
other similar borrowing methods.
(F) For purposes of this section, the spread is the difference
between the cost of funds obtained using the reverse repurchase
agreement and the earnings obtained on the reinvestment of the
funds.
0) Medium -term notes, defined as all corporate and depository
institution debt securities with a maximum remaining maturity of
five years or less, issued by corporations organized and operating
within the United States or by depository institutions licensed by the
United States or any state and operating within the United States.
Notes eligible for investment under this subdivision shall be rated
"A' or better by a nationally recognized rating service. Purchases of
medium -term notes shall not include other instruments authorized
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Ch. 339 — 6 —
by this section and may not exceed 30 percent of the agency's surplus
money which may be invested pursuant to this section.
(k) (1) Shares of beneficial interest issued by diversified
management companies that invest in the securities and obligations
as authorized by subdivisions (a) to 0), inclusive, or subdivisions (m)
or (n) and that comply with the investment restrictions of this article
and Article 2 (commencing with Section 53630). However,
notwithstanding these restrictions, a counterparty to a reverse
repurchase agreement or securities lending agreement is not
required to be a primary dealer of the Federal Reserve Bank of New
York if the company's board of directors finds that the counterparty
presents a minimal risk of default, and the value of the securities
underlying a repurchase agreement or securities lending agreement
may be 100 percent of the sales price if the securities are marked to
market daily.
(2) Shares of beneficial interest issued by diversified management
companies that are money market funds registered with the
Securities and Exchange Commission under the Investment
Company Act of 1940 (15 U.S.C. Sec. 80a-1 and following).
(3) If investment is in shares issued pursuant to paragraph (1), the
company shall have met either of the following criteria:
(A) Attained the highest ranking or the highest letter and
numerical rating provided by not less than two nationally recognized
statistical rating organizations.
(B) Retained an investment adviser registered or exempt from
registration with the Securities and Exchange Commission with not
less than five years' experience investing in the securities and
obligations authorized by subdivisions (a) to 0), inclusive, or
subdivisions (m) or (n) and with assets under management in excess
of five hundred million dollars ($500,000,000).
(4) If investment is in shares issued pursuant to paragraph (2), the
company shall have met either of the following criteria:
(A) Attained the highest ranking or the highest letter and
numerical rating provided by not less than two nationally recognized
statistical rating organizations.
(B) Retained an investment adviser registered or exempt from
registration with the Securities and Exchange Commission with not
less than five years' experience managing money market mutual
funds with assets under management in excess of five hundred
million dollars ($500,000,000).
(5) The purchase price of shares of beneficial interest purchased
pursuant to this subdivision shall not include any commission that the
companies may charge and shall not exceed 20 percent of the
agency's surplus money that may be invested pursuant to this section.
However, no more than 10 percent of the agency's surplus funds may
be invested in shares of beneficial interest of any one mutual fund
pursuant to paragraph (1).
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(l) Notwithstanding anything to the contrary contained in this
section, Section 53635, or any other provision of law, moneys held by
a trustee or fiscal agent and pledged to the payment or security of
bonds or other indebtedness, or obligations under a lease, installment
sale, or other agreement of a local agency, or certificates of
participation in those bonds, indebtedness, or lease installment sale,
or other agreements, may be invested in accordance with the
statutory provisions governing the issuance of those bonds,
indebtedness, or lease installment sale, or other agreement, or to the
extent not inconsistent therewith or if there are no specific statutory
provisions, in accordance with the ordinance, resolution, indenture,
or agreement of the local agency providing for the issuance.
(m) Notes, bonds, or other obligations that are at all times secured
by a valid first priority security interest in securities of the types listed
by Section 53651 as eligible securities for the purpose of securing local
agency deposits having a market value at least equal to that required
by Section 53652 for the purpose of securing local agency deposits.
The securities serving as collateral shall be placed by delivery or book
entry into the custody of a trust company or the trust department of
a bank which is not affiliated with the issuer of the secured obligation,
and the security interest shall be perfected in accordance with the
requirements of the Uniform Commercial Code or federal
regulations applicable to the types of securities in which the security
interest is granted.
(n) Any mortgage passthrough security, collateralized mortgage
obligation, mortgage -backed or other pay -through bond, equipment
lease -backed certificate, consumer receivable passthrough
certificate, or consumer receivable -backed bond of a maximum of
five years maturity. Securities eligible for investment under this
subdivision shall be issued by an issuer having an "A" or higher rating
for the issuer's debt as provided by a nationally recognized rating
service and rated in a rating category of "AA' or its equivalent or
better by a nationally recognized rating service. Purchase of
securities authorized by this subdivision may not exceed 20 percent
of the agency's surplus money that may be invested pursuant to this
section.
SEC. 2. Section 53601.2 of the Government Code is amended to
read:
53601.2. Notwithstanding subdivision (g) of Section 53601, the
board of supervisors of a county may invest in commercial paper of
"prime" quality of the highest ranking or of the highest letter and
numerical rating as provided for by Moody's Investors Service, Inc.,
or Standard and Poor's Corporation. Eligible paper is further limited
to issuing corporations that are organized and operating within the
United States and have total assets in excess of five hundred million
dollars ($500,000,000) and an "A" or higher rating for the issuer's
debt, other than commercial paper, if any, as provided for by Moody's
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Investors Service, Inc., or Standard and Poor's Corporation.
Purchases of eligible commercial paper may not exceed 270 days'
maturity nor represent more than 10 percent of the outstanding
paper of an issuing corporation. Purchases of commercial paper may
not exceed 40 percent of the agency's surplus money that may be
invested pursuant to this section. No more than 10 percent of the
agency's surplus money that may be invested pursuant to this section
may be invested in the outstanding paper of any single issuing
corporation.
SEC. 3. Section 53635 of the Government Code is amended to
read:
53635. As far as possible, all money belonging to, or in the custody
of, a local agency, including money paid to the treasurer or other
official to pay the principal, interest, or penalties of bonds, shall be
deposited for safekeeping in state or national banks, savings
associations or federal associations, credit unions, or federally insured
industrial loan companies in this state selected by the treasurer or
other official having the legal custody of the money; or, unless
otherwise directed by the legislative body pursuant to Section 53601,
may be invested in the investments set forth below. A local agency
purchasing or obtaining any securities described in this section, in a
negotiable, bearer, registered, or nonregistered format, shall require
delivery of all the securities to the local agency, including those
purchased for the agency by financial advisers, consultants, or
managers using the agency's funds, by book -entry, physical delivery,
or by third -party custodial agreement. The transfer of securities to
the counterparty bank's customer book entry account may be used
for book -entry delivery. For purposes of this section, "counterparty"
means the other party to the transaction. A counterparty bank's trust
department or separate safekeeping department may be used for the
physical delivery of the security if the security is held in the name of
the local agency. Where this section specifies a percentage limitation
for a particular category of investment, that percentage is applicable
only at the date of purchase.
(a) Bonds issued by the local agency, including bonds payable
solely out of the revenues from a revenue -producing property
owned, controlled, or operated by the local agency or by a
department, board, agency, or authority of the local agency.
(b) United States Treasury notes, bonds, bills, or certificates of
indebtedness, or those for which the faith and credit of the United
States are pledged for the payment of principal and interest.
(c) Registered state warrants or treasury notes or bonds of this
state, including bonds payable solely out of the revenues from a
revenue -producing property owned, controlled, or operated by the
state or by a department, board, agency, or authority of the state.
(d) Bonds, notes, warrants, or other evidences of indebtedness of
any local agency within this state, including bonds payable solely out
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of the revenues from a revenue -producing property owned,
controlled, or operated by the local agency, or by a department,
board, agency, or authority of the local agency.
(e) Obligations issued by banks for cooperatives, federal land
banks, federal intermediate credit banks, federal home loan banks,
the Federal Home Loan Bank, the Tennessee Valley Authority, or in
obligations, participations, or other instruments of, or issued by, or
fully guaranteed as to principal and interest by, the Federal National
Mortgage Association; or in guaranteed portions of Small Business
Administration notes; or in obligations, participations, or other
instruments of, or issued by, a federal agency or a United States
government -sponsored enterprise.
(f) Bills of exchange or time drafts drawn on and accepted by a
commercial bank, otherwise known as bankers acceptances.
Purchases of bankers acceptances may not exceed 180 days maturity
or 40 percent of the agency's surplus funds which may be invested
pursuant to this section. However, no more than 30 percent of the
agency's surplus funds may be invested in the bankers acceptances
of any one commercial bank pursuant to this section.
This subdivision does not preclude a municipal utility district from
investing any surplus money in its treasury in any manner authorized
by the Municipal Utility District Act, Division 6 (commencing with
Section 11501) of the Public Utilities Code.
(g) Commercial paper of "prime" quality of the highest ranking
or of the highest letter and numerical rating as provided for by
Moody's Investors Service, Inc., or Standard and Poor's Corporation.
Eligible paper is further limited to issuing corporations that are
organized and operating within the United States and having total
assets in excess of five hundred million dollars ($500,000,000) and
having an "A" or higher rating for the issuer's debt, other than
commercial paper, if any, as provided for by Moody's Investors
Service, Inc., or Standard and Poor's Corporation. Purchases of
eligible commercial paper may not exceed 270 days maturity nor
represent more than 10 percent of the outstanding paper of an issuing
corporation. Purchases of commercial paper may not exceed 15
percent of the agency's surplus money which may be invested
pursuant to this section. An additional 15 percent, or a total of 30
percent of the agency's money or money in its custody, may be
invested pursuant to this subdivision. The additional 15 percent may
be so invested only if the dollar -weighted average maturity of the
entire amount does not exceed 31 days. "Dollar -weighted average
maturity" means the sum of the amount of each outstanding
commercial paper investment multiplied by the number of days to
maturity, divided by the total amount of outstanding commercial
paper.
(h) Negotiable certificates of deposit issued by a nationally or
state -chartered bank or a savings association or federal association or
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Ch. 339 —10 —
a state or federal credit union or by a state -licensed branch of a
foreign bank. Purchases of negotiable certificates of deposit may not
exceed 30 percent of the agency's surplus money which may be
invested pursuant to this section. For purposes of this section,
negotiable certificates of deposit do not come within Article 2
(commencing with Section 53630) of Chapter 4 of Part 1 of Division
2 of Title 5, except that the amount so invested shall be subject to the
limitations of Section 53638. For purposes of this section, the
legislative body of a local agency and the treasurer or other official
of the local agency having legal custody of the money are prohibited
from depositing or investing local agency funds, or funds in the
custody of the local agency, in negotiable certificates of deposit issued
by a state or federal credit union if a member of the legislative body
of the local agency, or an employee of the administrative officer,
manager's office, budget office, auditor -controller's office, or
treasurer's office of the local agency also serves on the board of
directors, or any committee appointed by the board of directors, or
the credit committee or supervisory committee of the state or federal
credit union issuing the negotiable certificates of deposit.
(i) (1) Investments in repurchase agreements or reverse
repurchase agreements, or securities lending agreements of any
securities authorized by this section, so long as the agreements are
subject to this subdivision, including the delivery requirements
specified in this section.
(2) Investments in repurchase agreements or securities lending
agreements may be made, on any investment authorized in this
section, when the term of the agreement does not exceed one year.
The market value of securities that underlay a repurchase agreement
shall be valued at 102 percent or greater of the funds borrowed
against those securities and the value shall be adjusted no less than
quarterly. Since the market value of the underlying securities is
subject to daily market . fluctuations, the investments in repurchase
agreements shall be in compliance if the value of the underlying
securities is brought back up to 102 percent no later than the next
business day.
(3) Reverse repurchase agreements may be utilized only when
either of the following conditions are met:
(A) The security was owned or specifically committed to
purchase, by the local agency, prior to repurchase agreement on
December 31, 1994, and was sold using a reverse repurchase
agreement or securities lending agreement on December 31, 1994.
(B) The security to be sold on reverse repurchase agreement or
securities lending agreement has been owned and fully paid for by
the local agency for a minimum of 30 days prior to sale; the total of
all reverse repurchase agreements and securities lending
agreements on investments owned by the local agency not purchased
or committed to purchase, prior to December 31, 1994, does not
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exceed 20 percent of the base value of the portfolio; and the
agreement does not exceed a term of 92 days, unless the agreement
includes a written codicil guaranteeing a minimum earning or spread
for the entire period between the sale of a security using a reverse
repurchase agreement or securities lending agreement and the final
maturity date of the same security.
(4) After December 31, 1994, a reverse repurchase agreement or
securities lending agreement may not be entered into with securities
not sold on a reverse repurchase agreement or securities lending
agreement and purchased, or committed to purchase, prior to that
date, as a means of financing or paying for the security sold on a
reverse repurchase agreement or securities lending agreement, but
may only be entered into with securities owned and previously paid
for a minimum of 30 days prior to the settlement of the reverse
repurchase agreement or securities lending agreement, in order to
supplement the yield on securities owned and previously paid for or
to provide funds for the immediate payment of a local agency
obligation. Funds obtained or funds within the pool of an equivalent
amount to that obtained from selling a security to a counterparty by
way of a reverse repurchase agreement or securities lending
agreement, on securities originally purchased subsequent to
December 31, 1994, shall not be used to purchase another security
with a maturity longer than 92 days from the initial settlement date
of the reverse repurchase agreement or securities lending
agreement, unless the reverse repurchase agreement or securities
lending agreement includes a written codicil guaranteeing a
minimum earning or spread for the entire period between the sale
of a security using a reverse repurchase agreement or securities
lending agreement and the final maturity date of the same security.
Reverse repurchase agreements or securities lending agreements
specified in subparagraph (B) of paragraph (3) may not be entered
into unless the percentage restrictions specified in that subparagraph
are met, including the total of any reverse repurchase agreements or
securities lending agreements specified in subparagraph (A) of
paragraph (3).
(5) Investments in reverse repurchase agreements, securities
lending agreements, or similar investments in which the local agency
sells securities prior to purchase with a simultaneous agreement to
repurchase the security, may only be made upon prior approval of
the governing body of the local agency and shall only be made with
primary dealers of the Federal Reserve Bank of New York.
(6) (A) "Repurchase agreement" means a purchase of securities
by the local agency pursuant to an agreement by which the
counterparty seller will repurchase the securities on or before a
specified date and for a specified amount and the counterparty will
deliver the underlying securities to the local agency by book entry,
physical delivery, or by third -party custodial agreement. The transfer
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Ch. 339 —12 —
of underlying securities to the counterparty bank's customer
book -entry account may be used for book -entry delivery.
(B) "Securities," for purpose of repurchase under this subdivision,
means securities of the same issuer, description, issue date, and
maturity.
(C) "Reverse repurchase agreement" means a sale of securities by
the local agency pursuant to an agreement by which the local agency
will repurchase the securities on or before a specified date, and
includes other comparable agreements.
(D) "Securities lending agreement" means an agreement under
which a local agency agrees to transfer securities to a borrower who,
in turn, agrees to provide collateral to the local agency. During the
term of the agreement, both the securities and the collateral are held
by a third party. At the conclusion of the agreement, the securities
are transferred back to the local agency in return for the collateral.
(E) For purposes of this section, the base value of the local
agency's pool portfolio shall be that dollar amount obtained by
totaling all cash balances placed in the pool by all pool participants,
excluding any amounts obtained through selling securities by way of
reverse repurchase agreements or other similar borrowing methods.
(F) For purposes of this section, the spread is the difference
between the cost of funds obtained using the reverse repurchase
agreement or securities lending agreement and the earnings
obtained on the reinvestment of the funds.
0) Medium -term notes, defined as all corporate and depository
institution debt securities with a maximum remaining maturity of
five years or less, issued by corporations organized and operating
within the United States or by depository institutions licensed by the
United States or any state and operating within the United States.
Notes eligible for investment under this subdivision shall be rated
"A" or better by a nationally recognized rating service. Purchases of
medium -term notes shall not include other instruments authorized
by this section and may riot exceed 30 percent of the agency's surplus
money which may be invested pursuant to this section.
(k) (1) Shares of beneficial interest issued by diversified
management companies that invest in the securities and obligations
as authorized by subdivisions (a) to 0), inclusive, or subdivision (l)
or (m) and that comply with the investment restrictions of this article
and Article 1 (commencing with Section 53600). However,
notwithstanding these restrictions, a counterparty to a reverse
repurchase agreement or securities lending agreement is not
required to be a primary dealer of the Federal Reserve Bank of New
York if the company's board of directors finds that the counterparty
presents a minimal risk of default, and the value of the securities
underlying a repurchase agreement or securities lending agreement
may be 100 percent of the sales price if the securities are marked to
market daily.
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(2) Shares of beneficial interest issued by diversified management
companies that are money market funds registered with the
Securities and Exchange Commission under the Investment
Company Act of 1940 (15 U.S.C. Sec. 80a-1 and following).
(3) If investment is in shares issued pursuant to paragraph (1), the
company shall have met either of the following criteria:
(A) Attained the highest ranking or the highest letter and
numerical rating provided by not less than two nationally recognized
statistical rating organizations.
(B) Retained an investment adviser registered or exempt from
registration with the Securities and Exchange Commission with not
less than five years' experience investing in the securities and
obligations authorized by subdivisions (a) to 0), inclusive, or
subdivision (l) or (m) and with assets under management in excess
f five hundred million dollars ($500,000,000).
(4) If investment is in shares issued pursuant to paragraph (2), the
company shall have met either of the following criteria:
(A) Attained the highest ranking or the highest letter and
numerical rating provided by not less than two nationally recognized
statistical rating organizations.
(B) Retained an investment adviser registered or exempt from
registration with the Securities and Exchange Commission with not
less than five years' experience managing money market mutual
ands with assets under management in excess of five hundred
million dollars ($500,000,000).
(5) The purchase price of shares of beneficial interest purchased
pursuant to this subdivision shall not include any commission that the
companies may charge and shall not exceed 20 percent of the
agency's surplus money that may be invested pursuant to this section.
However, no more than 10 percent of the agency's surplus funds may
e invested in shares of beneficial interest of any one mutual fund
pursuant to paragraph (1).
(l) Notes, bonds, or other obligations which are at all times
secured by a valid first priority security interest in securities of the
types listed by Section 53651 as eligible securities for the purpose of
securing local agency deposits having a market value at least equal
to that required by Section 53652 for the purpose of securing local
agency deposits. The securities serving as collateral shall be placed
y delivery or book entry into the custody of a trust company or the
trust department of a bank which is not affiliated with the issuer of
the secured obligation, and the security interest shall be perfected in
accordance with the requirements of the Uniform Commercial Code
or federal regulations applicable to the types of securities in which
the security interest is granted.
(m) Any mortgage passthrough security, collateralized mortgage
obligation, mortgage -backed or other pay -through bond, equipment
lease -backed certificate, consumer receivable passthrough
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Ch. 339 —14 —
certificate, or consumer receivable -backed bond of a maximum of
five years maturity. Securities eligible for investment under this
subdivision shall be issued by an issuer having an "A" or higher rating
for the issuer's debt as provided by a nationally recognized rating
service and rated in a rating category of "AA' or its equivalent or
better by a nationally recognized rating service. Purchase of
securities authorized by this subdivision may not exceed 20 percent
of the agency's surplus money that may be invested pursuant to this
section.
SEC. 4. Section 53635.2 of the Government Code is amended to
read:
53635.2. Notwithstanding subdivision (g) of Section 53635, the
board of supervisors of a county may invest in commercial paper of
"prime" quality of the highest ranking or of the highest letter and
numerical rating as provided for by Moody's Investors Service, Inc.,
or Standard and Poor's Corporation. Eligible paper is further limited
to issuing corporations that are organized and operating within the
United States and have total assets in excess of five hundred million
dollars ($500,000,000) and an "A" or higher rating for the issuer's
debt, other than commercial paper, if any, as provided for by Moody's
Investors Service, Inc., or Standard and Poor's Corporation.
Purchases of eligible commercial paper may not exceed 270 days'
maturity nor represent more than 10 percent of the outstanding
paper of an issuing corporation. Purchases of commercial paper may
not exceed 40 percent of the agency's surplus money that may be
invested pursuant to this section. No more than 10 percent of the
agency's surplus money that may be invested pursuant to this section
may be invested in the outstanding paper of any single issuing
corporation.
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