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2011 02 09 IAB MinutesINVESTMENT ADVISORY BOARD Meeting February 9, 2011 CALL TO ORDER Regular meeting of the La Quinta Investment Advisory Board was called to order at the hour of 4:03 P.M. by Vice -Chair Spirtos followed by the Pledge of Allegiance. PRESENT: Board Members Mortenson, Blum and Spirtos ABSENT: Board Member Park OTHERS PRESENT: John Falconer, Finance Director and Vianka Orrantia, Senior Secretary If PUBLIC COMMENT - None III CONFIRMATION OF AGENDA - Confirmed IV CONSENT CALENDAR 1. Approval of Minutes of Meeting on January 12, 2011 for the Investment Advisory Board. Board Member Spirtos requested that the following correction be made to page 3, under appointment of Investment Advisory Board Vice - Chairperson Board Member Spirtos nominated herself as Vice - Chairperson MOTION - It was moved by Board Members Blum / Mortenson to approve the Minutes of January 12, 2011 as amended. Motion carried unanimously. V BUSINESS SESSION A. Transmittal of Treasury Report for December 2010 Mr. Falconer presented and reviewed the staff report for the month of December, advising the Board that the overall average maturity increased from 181 days to 265 days with the yield continuing to remain the same. Mr. Falconer further advised that there was an increase in the U.S. Treasury investments as a result of the drawn down in LAIF. In response to Board Member Spirtos, Mr. Falconer replied that the drawn down in LAIF was a result of some concerns with the state's budget and the extension of yield to a longer term. General discussion ensued amongst the Board and staff regarding the increase in yield in the two -year Treasury note. Mr. Falconer advised that in late January the City was in receipt of the first installment of property tax remittance, which a small portion was invested in LAIF and the remainder invested in various commercial paper and Federal Home Loan bank discount notes. In response to Board Member Spirtos, Mr. Falconer advised that the table on page 2, column "Other" the $1.00 reflected was a rounded number. Mr. Falconer further advised that under the current Investment Policy there are two classifications of Medium -Term Notes: TLGP and Non -TLGP Corporate Notes. Reflected on page 4 are the current reclassification changes which went from 10% to 20 %. MOTION — It was moved Board Members Mortenson /Blum to review, receive, and file the Treasurers Report for August, 2010. Motion carried unanimously. B. Consideration of Fiscal Year 2011 -2012 Work Plan Items and Review the 2011 -2012 Investment Policy Mr. Falconer summarized for the Board the process of the review of the 2011 - 2012 Work Plan Items and the 2011 -2012 Investment Policy. Mr. Falconer suggested to the Board that one of the items for consideration would be an alternative to LAIF. 2 General discussion ensued amongst the Board and staff regarding the concerns of LAIF and possible alternatives. In response to Board Member Mortenson, Mr. Falconer clarified that CAMP is a joint power authority set up similar to LAIF with same day liquidity, managed by PF &M and similar to that of a commercial money market funds. In response to Board Member Spirtos, Mr. Falconer advised that due to the policy's buy and hold policy, the City does have exceptions to sell an investment prior to maturity (i.e. liquidity or risk of loss of principal). In response to Board Member Blum, Mr. Falconer advised that the City uses brokers such as those used by LAIF, with the only difference is the dollar invested by LAIF vs. that of the City are larger. Continued general discussion ensued amongst the Board and staff regarding LAIF. MOTION — It was moved by Board Members Spirtos /Mortensen to continue the review of the 2011 -2012 Work Plan and the 2011 -2012 Investment Policy. Motion carried unanimously. C. California Municipal Treasurer's Conference — San Diego, CA April 19 — 22, 2011 Mr. Falconer presented the staff report advising that the Annual California Municipal Treasurers Association Conference will be held April 19 — 22, 2011 in San Diego, California. Mr. Falconer further advised that the City does provide for one staff member and two Board Members to attend upon Council approval. Board Members Spirtos and Mortenson volunteered to attend. MOTION — It was moved by Board Members Blum /Mortenson to have Investment Advisory Board Members Spirtos and Mortenson attend the CMTA Conference in San Diego, CA. Motion carried unanimously. VI CORRESPONDENCE AND WRITTEN MATERIAL A. Month End Cash Report — January 2011 Mr. Falconer presented and reviewed the January 2011 Month -End Cash Report advising that page 2 reflects the overall investments for the month totaling $10 3 million, $5 million in commercial paper at 25 basis points for 45 days and $5 million in Federal Home Loans Bank Discount Notes at 12 basis points for 30 days. Noted and Filed B. Pooled Money Investment Board Reports — November 2010 General comment was made by Mr. Falconer advising that the average life for LAIF in comparison to a year ago has declined from 222 days to 184 days, with the rate also down from 61 basis points to 45 basis points. Noted and Filed VII BOARD MEMBER ITEMS - None VIII ADJOURNMENT MOTION - It was moved by Board Members Mortenson /Blum to adjourn the meeting at 4:46 p.m. Motion carried unanimously. i Submitted i� Vianka � Orran / t � ia Senior Secretary 0