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2019 10 09 FACFINANCIAL ADVISORY COMMISSION 1 OCTOBER 9, 2019 SPECIAL MEETING NOTICE OF SPECIAL MEETING OF THE LA QUINTA FINANCIAL ADVISORY COMMISSION TO THE COMMISSIONERS OF THE LA QUINTA FINANCIAL ADVISORY COMMISSION: NOTICE IS HEREBY GIVEN that a special meeting of the La Quinta Financial Advisory Commission is hereby called to be held on Wednesday, October 9, at 4:00 p.m. at La Quinta City Hall located at 78495 Calle Tampico, La Quinta, CA 92253 for the following purpose: ANNOUNCEMENTS, PRESENTATIONS AND WRITTEN COMMUNICATIONS 1.PROCLAMATION – RECOGNITION OF SERVICE FOR OUTGOING COMMISSIONER TURBOW 2.2017/18 COMPREHENSIVE ANNUAL FINANCE REPORT AWARD 3.CITY BOARDS AND COMMISSIONS – ROLES AND RESPONSIBILITIES OF APPOINTED MEMBERS CONSENT CALENDAR 1.APPROVE MINUTES DATED AUGUST 7, 2019 2.RECEIVE AND FILE REVENUE AND EXPENDITURE REPORT DATED JUNE 30, 2019 3.RECEIVE AND FILE FOURTH QUARTER 2018/19 TREASURY REPORTS FOR APRIL, MAY, AND JUNE 2019, WITH FISCAL YEAR-END SUMMARY BUSINESS SESSION 1.REVIEW AND APPROVE CASH MANAGEMENT POLICY 2.REVIEW BROKER/DEALER SELECTION AND APPROVE EDITS TO INVESTMENT POLICY ADDING NEW BROKERS TO APPROVED FINANCIAL INSTITUTIONS LIST 3.APPOINT TWO FINANCIAL ADVISORY COMMISSIONERS TO FORMULATE AND PREPARE THE ANNUAL MEASURE G SALES TAX OVERSIGHT COMPLIANCE REPORT 4.APPOINT UP TO THREE FINANCIAL ADVISORY COMMISSIONERS TO REVIEW THE 2019 UPDATE TO THE DEVELOPMENT IMPACT FEE STUDY FINANCIAL ADVISORY COMMISSION 2 OCTOBER 9, 2019 SPECIAL MEETING STUDY SESSION 1.REVIEW AND DISCUSS PRELIMINARY 10-YEAR FINANCIAL PROJECTION FOR THE GENERAL FUND 2.DISCUSS PENSION TRUST AND UNFUNDED LIABILITY DEPARTMENTAL REPORTS 1.FIRST QUARTER 2019 (JANUARY – MARCH) SALES TAX UPDATE FOR THE CITY OF LA QUINTA 2.2019/20 INVESTMENT POLICY CERTIFICATION Dated: October 3, 2019 /s/ W. Richard Mills W. RICHARD MILLS, Chairperson Attest: Jessica Delgado, Management Assistant DECLARATION OF POSTING I, Jessica Delgado, Management Assistant, do hereby declare that the foregoing notice for the La Quinta Financial Advisory Commission special meeting of October 9, 2019 was posted on the City’s website, near the entrance to the Council Chamber at 78-495 Calle Tampico, and the bulletin boards at 78-630 Highway 111, and at 51-321 Avenida Bermudas, on October 3, 2019. Jessica Delgado, Management Assistant FINANCIAL ADVISORY COMMISSION AGENDA 1 OCTOBER 9, 2019 SPECIAL MEETING FINANCIAL ADVISORY COMMISSION AGENDA CITY HALL STUDY SESSION ROOM 78-495 Calle Tampico, La Quinta SPECIAL MEETING ON WEDNESDAY, OCTOBER 9, 2019 AT 4:00 P.M. Roll Call: Commissioners: Batavick, Hoffner, Hunter, Lopez, Rosen, Twohey and Chairperson Mills PLEDGE OF ALLEGIANCE PUBLIC COMMENT At this time members of the public may address the Commission on any matter not listed on the agenda. Please complete a “Request to Speak” form and limit your comments to three minutes. The Financial Advisory Commission values your comments; however, in accordance with State law, no action shall be taken on any item not appearing on the agenda unless it is an emergency item authorized by GC 54954.2(b). CONFIRMATION OF AGENDA ANNOUNCEMENTS, PRESENTATIONS AND WRITTEN COMMUNICATIONS 1.Proclamation – Recognition of Service for Outgoing Commissioner Turbow 2.2017/18 Comprehensive Annual Finance Report Award 3.City Boards and Commissions – Roles and Responsibilities of Appointed Members CONSENT CALENDAR 1.Approve Minutes Dated August 7, 2019 2.Receive and File Revenue and Expenditure Report Dated June 30, 2019 3.Receive and File the Fourth Quarter 2018/19 Treasury Reports for April, May, and June 2019, With Fiscal Year-End Summary BUSINESS SESSION 1.Review and Approve Cash Management Policy 2.Review Broker/Dealer Selection and Approve Edits to Investment Policy Adding New Brokers to Approved Financial Institutions List 3.Appoint two Financial Advisory Commissioners to Formulate and Prepare the Annual Measure G Sales Tax Oversight Compliance Report 4.Appoint Up to Three Financial Advisory Commissioners to Review the 2019 Update to the Development Impact Fee Study STUDY SESSION Financial Advisory Commission agendas and staff reports are now available on the City’s web page: www.laquintaca.gov FINANCIAL ADVISORY COMMISSION AGENDA 2 OCTOBER 9, 2019 SPECIAL MEETING 1.Review and Discuss Preliminary 10-Year Financial Projection for the General Fund 2.Discuss Pension Trust and Unfunded Liability DEPARTMENTAL REPORTS 1.First Quarter 2019 (January – March) Sales Tax Update for the City of La Quinta 2.2019/20 Investment Policy Certification COMMISSIONERS’ ITEMS ADJOURNMENT The next regular quarterly meeting of the La Quinta Financial Advisory Commission will be held on November 13, 2019 in the La Quinta Study Session Room, 78-495 Calle Tampico, La Quinta, CA 92253 and commencing at 4:00 p.m. DECLARATION OF POSTING I, Jessica Delgado, Management Assistant, of the City of La Quinta, do hereby declare that the foregoing Agenda for the La Quinta Financial Advisory Commission special meeting was posted on the City’s website, near the entrance to the Council Chamber at 78-495 Calle Tampico, and the bulletin boards at 78-630 Highway 111, and 51-321 Avenida Bermudas, on October 3, 2019. DATED: October 3, 2019 Jessica Delgado, Management Assistant City of La Quinta, California Public Notices The La Quinta City Study Session Room is handicapped accessible. If special equipment is needed for the hearing impaired, please call the City Clerk’s office at (760) 777-7092, twenty- four (24) hours in advance of the meeting and accommodations will be made. If special electronic equipment is needed to make presentations to the Financial Advisory Commission (FAC), arrangements should be made in advance by contacting the City Clerk’s office at (760) 777-7092. A one (1) week notice is required. If background material is to be presented to the FAC during a special FAC meeting, please be advised that eight (8) copies of all documents, exhibits, etc., must be supplied to the Management Assistant for distribution. It is requested that this take place prior to the beginning of the meeting. Any Writings or documents provided to a majority of the FAC regarding any item(s) on the agenda will be made available for public inspection at the Community Development counter at City Hall located at 78-495 Calle Tampico, La Quinta, California, 92253, during normal business hours. FINANCIAL ADVISORY COMMISSION MINUTES Page 1 of 3 AUGUST 7, 2019 SPECIAL MEETING FINANCIAL ADVISORY COMMISSION SPECIAL MEETING MINUTES WEDNESDAY, AUGUST 7, 2019 CALL TO ORDER A special meeting of the La Quinta Financial Advisory Commission (Commission) was called to order at 4:00 p.m. by Chairperson Mills. PRESENT: Commissioners: Batavick, Hoffner, Hunter, Lopez, Rosen, Twohey and Chairperson Mills ABSENT: None PLEDGE OF ALLEGIANCE Commissioner Hoffner led the audience in the Pledge of Allegiance. PUBLIC COMMENT ON MATTERS NOT ON THE AGENDA – None CONFIRMATION OF AGENDA – Confirmed ANNOUNCEMENTS, PRESENTATIONS, AND WRITTEN COMMUNICATIONS 1.LA QUINTA VILLAGE COMPLETE STREETS PROJECT Management Analyst Mignogna presented an update on the La Quinta Complete Streets Project, including the timeline for completing the five roundabouts in different stages; the type of pedestrian crossing light signals that would be used at each roundabout; and the City’s past and on-going public outreach efforts, and provided the Commission with the flyers and business cards used to keep the public informed about the project and its progress. City Consultant and Project Manager Nick Nickerson and the Commission discussed the roundabout speed limits. Staff explained that a speed survey will be conducted following the completion of the roundabouts to determine appropriate speed limits for those areas. 2.SILVERROCK MASTER INFRASTRUCTURE UPDATE Staff presented the Council meeting video on the SilverRock project as presented by Project Manager John Gamlin on behalf of SilverRock Development Company, from the August 6, 2019 Council meeting. City Manager McMillen gave an update on the timeframe for the SilverRock event site. Finance Director Romero announced that Council selected Paul Anderson as the new art event producer at the August 6, 2019 Council meeting. CONSENT CALENDAR ITEM NO. 1 FINANCIAL ADVISORY COMMISSION MINUTES Page 2 of 3 AUGUST 7, 2019 SPECIAL MEETING 3. FINANCIAL ADVISORY COMMISSIONERS AND CITY MANAGER INTRODUCTIONS Commissioners and City Staff congratulated Commissioner Hoffner on his appointment to the Commission; introduced themselves, and provided an overview of their backgrounds, and the rolls and responsibilities of their individual capacities for the City. CONSENT CALENDAR ITEMS 1. APPROVE FINANCIAL ADVISORY COMMISSION MINUTES DATED JUNE 5, 2019 The Commission requested a handout of the 10-year financial projections mentioned in the June 5, 2019 Commission minutes; Staff said a draft would be provided during the special Commission meeting scheduled for October 2019. 2. RECEIVE AND FILE REVENUE AND EXPENDITURE REPORT DATED MAY 31, 2019 The Commission inquired about the funding for homeless assistance; Staff said this is the second year the City has appropriated this funding, and explained the funding sources and allocations. City Manager McMillen explained the assistance and benefits of homelessness programs and organizations to La Quinta residents who were at risk of becoming homeless. Motion – A motion was made and seconded by Commissioners Batavick/Lopez to approve the Consent Calendar, as submitted. Motion passed unanimously. BUSINESS SESSION 1. APPOINT FINANCIAL ADVISORY COMMISSIONER CHAIRPERSON AND VICE-CHAIRPERSON FOR FISCAL YEAR 2019/20 Finance Director Romero presented the staff report, which is on file in the Finance Department. The Commission recommended to reappoint Commissioner Mills for Chairperson and Commissioner Twohey for Vice-Chairperson. Motion – A motion was made and seconded by Commissioners Rosen/Lopez to appoint Commissioner Mills to serve as Chairperson for fiscal year 2019/20. Motion passed unanimously. Motion – A motion was made and seconded by Commissioners Rosen/Lopez to appoint Commissioner Twohey, to serve as Vice-Chairperson for fiscal year 2019/20. Motion passed unanimously. FINANCIAL ADVISORY COMMISSION MINUTES Page 3 of 3 AUGUST 7, 2019 SPECIAL MEETING DEPARTMENTAL REPORTS Staff provided the Commission with verbal updates on the following Departmental Reports: 1.VERBAL UPDATE ON INFORMATION FOR INVESTMENT BROKERS Financial Director Romero gave a status update on the selection process for the Request for Information (RFI) proposal issued by the City on June 6, 2019; said four brokers were selected to be interviewed; and interviews will be held in early September. Commissioners Rosen and Hoffner commended Financial Services Analyst Hallick for preparing detailed books of the RFI proposals which made the review process much easier; and shared their experience so far throughout the RFI selection process. 2.VERBAL UPDATE ON UPCOMING FINANCIAL REPORTS FOR FISCAL YEAR 2019/20 The Commission and Staff discussed the timeline for the City’s upcoming Financial Reports for fiscal years 2018/19 and 2019/20. The Commission inquired about internal controls; Finance Director Romero said that the most recent audit for internal controls was completed in Spring of fiscal year 2018/19. She mentioned that the City has several external audits, some of which are unexpected, and noted the items the auditors have requested for this upcoming audit cycle. 3.VERBAL UPDATE ON BANKING AND MERCHANT SERVICES TRANSITION The Commission and Staff discussed the transition timeline for banking and merchant services from Wells Fargo to Bank of the West; implementation priorities of product and service items; and the input received from auditors during this transition. COMMISSIONERS’ ITEMS – None ADJOURNMENT There being no further business, it was moved and seconded by Commissioners Lopez/Twohey to adjourn this meeting at 5:29 p.m. Motion passed unanimously. Respectfully submitted, Jessica Delgado, Management Assistant City of La Quinta, California City of La Quinta FINANCIAL ADVISORY COMMISSION MEETING: October 9, 2019 STAFF REPORT AGENDA TITLE: RECEIVE AND FILE REVENUE AND EXPENDITURE REPORT DATED JUNE 30, 2019 RECOMMENDATION Receive and file revenue and expenditure report dated June 30, 2019. EXECUTIVE SUMMARY •The report summarizes the City’s year-to-date (YTD) revenues and period expenditures for June 2019 (Attachment 1). •These reports are also reviewed by the City Council. FISCAL IMPACT - None BACKGROUND/ANALYSIS Below is a summary of the column headers used on the Revenue and Expenditure Summary Reports: Original Total Budget – represents revenue and expenditure budgets the Council adopted in June 2018 for fiscal year 2018/19. Current Total Budget – represents original adopted budgets plus any carryovers (typically associated with long-term Capital Improvement Projects (CIP) from the prior fiscal year) and any Council approved budget amendments from throughout the year. Period Activity – represents actual revenues received and expenditures outlaid in the reporting month. Fiscal Activity – represents actual revenues received and expenditures outlaid YTD. Variance Favorable/(Unfavorable) - represents the dollar difference between YTD collections/expenditures and the current budgeted amount. Percent Used – represents the percentage activity as compared to budget YTD. CONSENT CALENDAR ITEM NO. 2 The revenue report includes revenues and transfers into funds from other funds (income items). Revenues are not received uniformly throughout the year, resulting in peaks and valleys. For example, large property tax payments are usually received in December and May. Similarly, Redevelopment Property Tax Trust Fund payments are typically received in January and June. Any timing imbalance of revenue receipts versus expenditures is funded from the City’s cash flow reserve. The expenditure report includes expenditures and transfers out to other funds. Unlike revenues, expenditures are more likely to be consistent from month to month. However, large debt service payments or CIP expenditures can cause swings. Prepared by: Rosemary Hallick, Financial Services Analyst Approved by: Karla Romero, Finance Director Attachment: 1. Revenue and Expenditure Report for June 30, 2019 MTD YTD YTD Percent of Budget General Fund 15,797,427$ 62,134,012$ 111.29% All Funds 42,429,692$ 117,129,305$ 72.31% MTD YTD YTD Percent of Budget General Fund 20,583,477$ 55,523,960$ 80.81% Payroll - General Fund 7,535,423$ 15,754,520$ 94.14% All Funds 20,658,802$ 100,950,490$ 55.51% June Expenditures June Revenues General Fund Non-General Fund Measure G Sales Tax 2,607,085$ County Government Revenue for Debt Service 13,123,942$ Sales Tax 2,420,800$ Transfers in - Capital Improvement (CIP)(1)4,555,854$ Property Tax in Lieu of Vehicle License Fees (VLF)2,033,379$ Transfers in for Economic Development Fund(2)2,975,564$ Transient Occupancy (Hotel) Tax 1,889,422$ County Government Revenue -Library/Museum 1,468,930$ Fire Service Credit (from County)1,503,320$ Development Agreement Funding(3)533,286$ General Fund Non-General Fund Transfers Out to CIP and Econ. Development 5,458,830$ Contributions to Other Agencies(5)1,491,698$ Sheriff Contract (April, May, June)4,591,396$ Capital Improvement Program (CIP)- Construction(6)1,262,913$ Fire Service Costs 1,193,818$ Transfers Out -Transportation DIF to CIP 977,180$ Park Equipment Maintenance Allocation(4)163,750$ Capital Improvement Program (CIP)- Design(7)753,551$ Insurance Allocation(4)114,650$ Transfers Out -Quimby to CIP 681,527$ (5) Payment to City of Indio (lead agency) for Madison Street widening from Avenue 50 to 52 (6) CIP Construction: Expenses associated with Highway Safety Improvement Program (HSIP) intersection improvements, Avenue 52 pavement rehab and striping, Eisenhower drainage, Dune Palms, and SilverRock Event Site. (7) CIP Design: Multiple CIP projects including SilverRock Event Site and infrastructure; X-Park, Dune Palms Road widening and bridge; Village Complete Streets; and Eisenhower drainage. Top Five Revenue/Income Sources for June Top Five Expenditures/Outlays for June (1) Transfers in to the Capital Improvement Fund are from General Fund, Quimby, and transportation sources including Developer Impact Fees (DIF), Gas Tax, and Measure A. (2) Transfer in to the Economic Development Fund from the General Fund for Hwy 111 land sale and unspent land acquisition funds. (3) Development agreement funding for Madison Street widening from Avenue 50 to 52. (4) These charges in the General Fund represent quarterly contributions to the Internal Service Funds. For Fiscal: 2018/19 Period Ending: 06/30/2019 10/3/2019 Page 1 of 2 Revenue Summary Fiscal Activity Variance Favorable (Unfavorable)Fund Period Activity Current Total Budget Original Total Budget Percent Used 101 - GENERAL FUND 62,134,01215,797,42752,297,400 55,831,050 6,302,962 111.29 % 201 - GAS TAX FUND 1,916,369271,3371,965,500 1,965,500 -49,131 97.50 % 202 - LIBRARY & MUSEUM FUND 3,735,4111,515,0332,333,000 2,313,000 1,422,411 161.50 % 203 - PUBLIC SAFETY FUND (MEASURE G)207,5712,778200,000 853,000 -645,429 24.33 % 210 - FEDERAL ASSISTANCE FUND 60,99960,99972,000 66,226 -5,227 92.11 % 212 - SLESA (COPS) FUND 150,87233,938100,100 100,100 50,772 150.72 % 213 - JAG FUND 26800213 55 125.88 % 215 - LIGHTING & LANDSCAPING FUND 1,592,07629,7521,586,100 1,586,100 5,976 100.38 % 217 - DEVELOPMENT AGREEMENT 682526030,800 -30,118 2.22 % 220 - QUIMBY FUND 93,41342,674367,000 383,000 -289,587 24.39 % 221 - AB 939 - CALRECYCLE FUND 82,41036,62963,700 66,200 16,210 124.49 % 223 - MEASURE A FUND 768,876136,275971,708 974,708 -205,832 78.88 % 224 - TUMF FUND 88560800 885 0.00 % 225 - INFRASTRUCTURE FUND 500222100100 400 499.77 % 226 - EMERGENCY MANAGEMENT PERFORMANCE GRANT (EMPG)10,58321,000012,000 -1,417 88.19 % 227 - STATE HOMELAND SECURITY PROGRAMS (SHSP)6,0186,01806,000 18 100.30 % 230 - CASp FUND, AB 1379 20,4911,5314,000 10,000 10,491 204.91 % 231 - SUCCESSOR AGCY PA 1 RORF 20,796,52913,227,615020,482,627 313,902 101.53 % 235 - SO COAST AIR QUALITY FUND 55,15340,88151,500 51,500 3,653 107.09 % 237 - SUCCESSOR AGCY PA 1 ADMIN 7,3503,421012,005 -4,655 61.22 % 241 - HOUSING AUTHORITY 759,468119,390315,000 543,000 216,468 139.87 % 243 - RDA LOW-MOD HOUSING FUND 33,33214,6508,000 18,000 15,332 185.18 % 247 - ECONOMIC DEVELOPMENT FUND 2,975,5642,975,56402,981,600 -6,036 99.80 % 248 - SA 2004 LO/MOD BOND FUND (Refinanced in 2014)13,39413,394010,000 3,394 133.94 % 249 - SA 2011 LOW/MOD BOND FUND (Refinanced in 2016)459,569149,03630,000 170,000 289,569 270.33 % 250 - TRANSPORTATION DIF FUND 730,048268,355369,000 379,000 351,048 192.62 % 251 - PARKS & REC DIF FUND 365,98038,987508,200 512,200 -146,220 71.45 % 252 - CIVIC CENTER DIF FUND 176,93453,188110,000 110,000 66,934 160.85 % 253 - LIBRARY DEVELOPMENT DIF 57,7925,16030,000 30,000 27,792 192.64 % 254 - COMMUNITY CENTER DIF 24,7703,20715,400 15,400 9,370 160.84 % 255 - STREET FACILITY DIF FUND 30,0658,76015,000 15,000 15,065 200.44 % 256 - PARK FACILITY DIF FUND 6,7216004,000 4,000 2,721 168.04 % 257 - FIRE PROTECTION DIF 81,37024,46440,000 40,000 41,370 203.42 % 270 - ART IN PUBLIC PLACES FUND 113,91435,69688,500 88,500 25,414 128.72 % 275 - LQ PUBLIC SAFETY OFFICER 2,8693762,100 2,100 769 136.64 % 299 - INTEREST ALLOCATION FUND 1,056,813476,46900 1,056,813 0.00 % 310 - LQ FINANCE AUTHORITY DEBT SERVICE 668,8610671,600 671,600 -2,739 99.59 % 401 - CAPITAL IMPROVEMENT PROGRAMS 9,801,2975,669,84111,955,941 56,663,794 -46,862,496 17.30 % 405 - SA PA 1 CAPITAL IMPRV FUND 134,16657,06300 134,166 0.00 % 501 - FACILITY & FLEET REPLACEMENT 1,021,124279,830923,700 1,088,700 -67,576 93.79 % 502 - INFORMATION TECHNOLOGY 1,121,613278,8931,189,800 1,496,800 -375,187 74.93 % 503 - PARK EQUIP & FACILITY FUND 722,959193,584675,000 690,000 32,959 104.78 % 504 - INSURANCE FUND 921,833230,662923,600 923,600 -1,767 99.81 % 601 - SILVERROCK RESORT 3,873,595174,6814,092,800 4,147,800 -274,205 93.39 % 602 - SILVERROCK GOLF RESERVE 79,85673,70070,000 70,000 9,856 114.08 % 735 - 97-1 AGENCY REDEMPTION FUND 60426500 604 0.00 % 740 - 2000-1 AGENCY REDEMPTION 145,6791,33100 145,679 0.00 % 760 - SUPPLEMENTAL PENSION PLAN 2,4151,2110800 1,615 301.90 % 761 - CERBT OPEB TRUST 106,23252,671020,000 86,232 531.16 % 762 - PARS PENSION TRUST 0006,540,000 -6,540,000 0.00 % Report Total:42,429,692 117,129,30582,049,749 161,976,023 -44,846,718 72.31 % ATTACHMENT 1 Accounts are subject to adjusting entries and audit. The City's Comprehensive Annual Financial Report (CAFR), published annually in December, is the best resource for all final audited numbers. For Fiscal: 2018/19 Period Ending: 06/30/2019 10/3/2019 Page 2 of 2 Expenditure Summary Fiscal Activity Variance Favorable (Unfavorable)Fund Period Activity Current Total Budget Original Total Budget Percent Used 101 - GENERAL FUND 55,523,96020,583,47751,153,413 68,707,441 13,183,482 80.81 % 201 - GAS TAX FUND 1,787,603402,2061,959,900 2,010,829 223,227 88.90 % 202 - LIBRARY & MUSEUM FUND 1,907,579781,7331,628,200 1,793,400 -114,179 106.37 % 210 - FEDERAL ASSISTANCE FUND 60,99960,99972,000 66,226 5,227 92.11 % 212 - SLESA (COPS) FUND 70,88717,060100,000 100,000 29,113 70.89 % 215 - LIGHTING & LANDSCAPING FUND 1,471,289219,6981,582,700 1,785,400 314,111 82.41 % 217 - DEVELOPMENT AGREEMENT 77,741067,000 97,000 19,259 80.15 % 220 - QUIMBY FUND 1,296,611681,5273,956,000 5,748,488 4,451,876 22.56 % 221 - AB 939 - CALRECYCLE FUND 91,81523,04335,000 95,000 3,185 96.65 % 223 - MEASURE A FUND 590,183277,264961,708 4,733,403 4,143,220 12.47 % 225 - INFRASTRUCTURE FUND 4,5431,810028,571 24,028 15.90 % 226 - EMERGENCY MANAGEMENT PERFORMANCE GRANT (EMPG)10,50010,500012,000 1,500 87.50 % 227 - STATE HOMELAND SECURITY PROGRAMS (SHSP)6,0323,01806,000 -32 100.53 % 230 - CASp FUND, AB 1379 1,26804,000 5,500 4,232 23.06 % 231 - SUCCESSOR AGCY PA 1 RORF 9,100,623-8,267,43709,339,728 239,105 97.44 % 235 - SO COAST AIR QUALITY FUND 42,73021,23654,000 54,000 11,270 79.13 % 237 - SUCCESSOR AGCY PA 1 ADMIN 26,7311,500012,005 -14,726 222.67 % 241 - HOUSING AUTHORITY 610,055134,000604,000 602,500 -7,555 101.25 % 243 - RDA LOW-MOD HOUSING FUND 166,6660250,000 267,667 101,001 62.27 % 248 - SA 2004 LO/MOD BOND FUND (Refinanced in 2014)1,035,21513,50401,451,947 416,732 71.30 % 249 - SA 2011 LOW/MOD BOND FUND (Refinanced in 2016)7,376,024007,416,000 39,976 99.46 % 250 - TRANSPORTATION DIF FUND 1,391,880978,990400,000 2,557,460 1,165,581 54.42 % 251 - PARKS & REC DIF FUND 4,5421,81002,405,952 2,401,410 0.19 % 252 - CIVIC CENTER DIF FUND 101,2371,810110,000 115,952 14,715 87.31 % 253 - LIBRARY DEVELOPMENT DIF 35,48011,38030,000 35,952 472 98.69 % 254 - COMMUNITY CENTER DIF 4,5421,8100107,591 103,049 4.22 % 255 - STREET FACILITY DIF FUND 30,4481,81015,000 20,952 -9,496 145.32 % 256 - PARK FACILITY DIF FUND 8,5081,8104,000 9,952 1,444 85.49 % 257 - FIRE PROTECTION DIF 11,0431,81040,000 45,952 34,909 24.03 % 270 - ART IN PUBLIC PLACES FUND 92,51218,588322,000 722,000 629,488 12.81 % 310 - LQ FINANCE AUTHORITY DEBT SERVICE 669,0380671,600 671,600 2,563 99.62 % 401 - CAPITAL IMPROVEMENT PROGRAMS 9,839,0673,821,06211,955,941 56,674,801 46,835,733 17.36 % 405 - SA PA 1 CAPITAL IMPRV FUND 50,99341,97705,343,052 5,292,059 0.95 % 501 - FACILITY & FLEET REPLACEMENT 846,42777,731923,700 1,155,784 309,357 73.23 % 502 - INFORMATION TECHNOLOGY 959,407119,9081,090,700 1,574,200 614,793 60.95 % 503 - PARK EQUIP & FACILITY FUND 305,197101,708705,000 775,000 469,803 39.38 % 504 - INSURANCE FUND 814,74914,769921,100 918,500 103,751 88.70 % 601 - SILVERROCK RESORT 4,319,025496,6904,090,800 4,146,000 -173,025 104.17 % 602 - SILVERROCK GOLF RESERVE 50,200050,200 105,200 55,000 47.72 % 740 - 2000-1 AGENCY REDEMPTION 144,30800144,309 1 100.00 % 760 - SUPPLEMENTAL PENSION PLAN 12,8330012,850 17 99.87 % Report Total:20,658,802 100,950,49083,757,962 181,876,165 80,925,674 55.51 % Accounts are subject to adjusting entries and audit. The City's Comprehensive Annual Financial Report (CAFR), published annually in December, is the best resource for all final audited numbers. City of La Quinta FINANCIAL ADVISORY COMMISSION MEETING: OCTOBER 9, 2019 STAFF REPORT AGENDA TITLE: RECEIVE AND FILE FOURTH QUARTER 2018/19 TREASURY REPORTS FOR APRIL, MAY, AND JUNE 2019 WITH FISCAL YEAR-END SUMMARY RECOMMENDATION Receive and file the fourth quarter fiscal year 2018/19 Treasury Reports for April, May, and June 2019 with fiscal year-end summary. BACKGROUND/ANALYSIS Commentary and Summary of Significant Activity The total book value of the portfolio increased $22.60 million, from $140.80 million at the end of March to $163.40 million at the end of June. An increase of $13.12 million was due to a Redevelopment Property Tax Trust Fund (RPTTF) pass-through apportionment payment which funds debt service obligations that are paid in August. The remainder of the increase reflects revenue, expenditure, and investment activities during the quarter. The portfolio is within policy limits for investment types and total allocation by type (see chart below), and is also within policy guidelines for investment ratings. Investment Type April May June Allowed Bank Accounts 3.11% 2.26% 2.81% 85% Local Agency Investment Fund (LAIF) Housing 11.31% 11.07% 10.01% (1)(2) Local Agency Investment Fund (LAIF) City 34.22% 33.49% 35.19% (1) Federal Agency Coupons 15.43% 14.76% 13.36% 30% Treasury Coupons 10.28% 10.06% 9.10% 100% Certificates of Deposit (CD's)14.33% 13.88% 13.62% 30% Corporate Notes 2.31% 2.26% 2.35% 10% Money Market Pool Accounts-CAMP (new)7.93% 11.16% 12.57% 20% Money Market with Fiscal Agent 0.00% 0.00% 0.00% (2) Managed Pool Accounts-OPEB Trust 1.09% 1.07% 1.00% (3) Total 100% 100% 100% (2) Funds held by fiscal agent and the LAIF Housing funds are governed by bond indentures and not subject to City Investment Policy (3) OPEB trust is a fiduciary account and not subject to City Investment Policy Portfolio Allocations (1) LAIF is subject to maximum dollar amount not a percentage of the portfolio CONSENT CALENDAR ITEM NO. 3 The market continued to react to the political climate and economic news, and staff worked with the City’s broker to capitalize on market conditions. The fiscal year annual effective rate of return is 2.04% as of June, a 7 basis point (bps) increase since March (Q3). Throughout the quarter, nine CDs, two agency bonds, and one treasury matured, and one agency bond was called for a total PAR value of $5,176,000. This money, along with an additional $1.5 million was used to purchase 21 new investments, which are listed in detail in the attached reports. Year-End Summary Rising interest rates during the first half of the fiscal year continued to be of benefit to the City; as investments matured they were replaced at rates as much as 100-175 bps higher. The City worked throughout 2018-19 to increase holdings, particularly in negotiable CDs, to capitalize on the climbing rates. Also, the City opened a local government investment pool (LGIP) account with the California Asset Management Program (CAMP) in order to take advantage of slightly higher yields than the state-run local agency investment fund (LAIF), while maintaining the liquidity required for operations. Overall, the average effective rate of return for the entire portfolio increased 73 bps from fiscal 2017-18 to 2018-19. However, during the second half of the fiscal year treasury rates have dropped considerably. Going forward, we anticipate the drop will affect new investments, as well as holdings in government pools (CAMP/LAIF) and could negatively impact the effective rate of return by as much as 40 bps in 2019- 20. Total Earnings Average Days to Maturity Effective Rate of Return YTD April 252,987$ 336 1.99% May 269,361$ 327 2.01% June 296,405$ 313 2.04% Quarter 818,753$ 325 2.01% 2016-17 2017-18 2018-19 Average Daily Balance 125,445,981$ 131,713,765$ 141,628,303$ Total Earnings 963,022$ 1,730,509$ 2,894,323$ Effective Rate of Return 0.77%1.31%2.04% Other Notes Money market funds with the fiscal agent are bond proceeds subject to bond indentures, not the City’s investment policy. Successor Agency (SA) funds cannot be invested long-term; therefore SA funds are only invested in LAIF. Looking Ahead The Treasurer follows a “buy and hold” Investment Policy, unless it is fiscally advantageous to actively trade outside of maturity dates. In the short term, the Treasurer will invest in CAMP and LAIF as needed. Longer term investments may include Government Sponsored Enterprise (agencies) securities, U.S. Treasuries, Corporate Notes, and Negotiable Certificates of Deposits. All investments recognize both immediate and long-term cash flow needs, and there is sufficient liquidity in the portfolio to meet expenditure requirements for the next six months. ALTERNATIVES - None Prepared by: Rosemary Hallick, Financial Services Analyst Approved by: Karla Romero, Finance Director/City Treasurer Attachment: 1. Treasurer’s Report for April 1, 2019 to June 30, 2019 ATTACHMENT 1 Days to Maturity Page 1 Par Value Book Value Maturity Date Stated RateMarket Value April 30, 2019 Portfolio Details - Investments Average BalanceIssuer Portfolio Management City of La Quinta YTM 365TermCUSIPInvestment # Purchase Date Bank Accounts 1City Petty Cash1059 3,300.00 3,300.0007/01/2016 3,300.00 1SYS1059 0.000 1First Empire Bank1060 0.00 0.0007/01/2016 0.00 1SYS1060 0.000 1La Quinta Palms Realty1062 249,851.30 249,851.3007/01/2016 249,851.30 1SYS1062 0.000 1Stifel, Nicolaus & Company1183 -248,000.00 -248,000.0003/18/2019 -248,000.00 1SYS1183 0.000 1Wells Fargo1057 4,489,649.56 4,489,649.5607/01/2016 4,489,649.56 14159282482 0.000 4,494,800.86 14,494,800.864,494,800.862,669,284.32Subtotal and Average 1 0.000 Local Agency Invstmnt Fund-Housing 1Local Agency Inv Fund1113 16,363,851.43 16,363,851.43 2.44516,319,382.05 125-33-005 2.445 16,363,851.43 116,319,382.0516,363,851.4316,316,247.84Subtotal and Average 1 2.445 Local Agency Investment Fund-City 1Local Agency Inv Fund1055 49,505,436.60 49,505,436.60 2.44549,412,935.65 198-33-434 2.445 49,505,436.60 149,412,935.6549,505,436.6049,359,960.35Subtotal and Average 1 2.445 Federal Agency Coupon Securities 72Federal Farm Credit Bank1092 1,000,000.00 992,600.00 07/12/20191.08007/10/2017 997,340.00 7323133EGLC7 1.456 854Federal Farm Credit Bank1105 1,000,000.00 992,200.00 09/01/20211.70011/09/2017 985,670.00 1,3923133EHWM1 1.913 50Federal Farm Credit Bank1141 500,000.00 494,750.00 06/20/20191.21005/31/2018 499,165.00 3853133EGFU4 2.224 373Federal Farm Credit Bank1142 500,000.00 491,750.00 05/08/20201.55005/31/2018 495,915.00 7083133EHJA2 2.427 1,588Federal Farm Credit Bank1158 250,000.00 247,275.00 09/05/20232.80010/15/2018 254,112.50 1,7863133EJYL7 3.041 728Federal Home Loan Bank1053 2,500,000.00 2,491,250.00 04/28/20211.35004/28/2016 2,453,725.00 1,8263130A7QZ1 1.423 544Federal Home Loan Bank1064 2,500,000.00 2,500,000.00 10/26/20201.37510/26/2016 2,463,750.00 1,4613130A9UQ2 1.375 499Federal Home Loan Bank1104 1,000,000.00 996,800.00 09/11/20201.62511/09/2017 990,090.00 1,0373130A66T9 1.741 1,399Federal Home Loan Bank1121 1,000,000.00 999,000.00 02/28/20232.62504/02/2018 1,000,210.00 1,7933130ADMF6 2.596 1,749Federal Home Loan Bank1177 500,000.00 498,550.00 02/13/20242.50003/01/2019 503,550.00 1,8103130AFW94 2.563 728Federal Home Loan Mtg Corp1054 2,500,000.00 2,500,000.00 04/28/20211.50004/28/2016 2,488,925.00 1,8263134G8Y37 1.400 1,063Federal Home Loan Mtg Corp1073 2,000,000.00 1,990,000.00 03/29/20222.00003/29/2017 1,982,380.00 1,8263134GBAE2 2.106 973Federal Home Loan Mtg Corp1084 1,000,000.00 999,500.00 12/29/20212.00007/06/2017 990,590.00 1,6373134GBXF4 2.012 1,183Federal Home Loan Mtg Corp1090 1,000,000.00 1,000,000.00 07/27/20222.15007/27/2017 994,240.00 1,8263134GBWG3 2.150 1,370Federal Home Loan Mtg Corp1116 1,000,000.00 1,000,000.00 01/30/20232.55001/30/2018 1,000,010.00 1,8263134GSCD5 2.550 1,394Federal Home Loan Mtg Corp1122 750,000.00 746,625.00 02/23/20232.75004/02/2018 750,127.50 1,7883134GSCQ6 2.849 1,245Federal Home Loan Mtg Corp1156 400,000.00 398,800.00 09/27/20223.00010/15/2018 400,892.00 1,4433134GSWS0 3.081 271Federal National Mtg Assn1072 2,000,000.00 2,000,000.00 01/27/20201.70003/27/2017 1,988,680.00 1,0363135G0S53 1.700 134Federal National Mtg Assn1139 500,000.00 496,700.00 09/12/20191.75005/31/2018 498,655.00 4693135G0ZG1 2.275 93Federal National Mtg Assn1140 500,000.00 492,000.00 08/02/20190.87505/31/2018 497,950.00 4283135G0N33 2.269 Portfolio CITY CP Run Date: 08/28/2019 - 12:45 PM (PRF_PM2) 7.3.0 Report Ver. 7.3.6.1 Days to Maturity Page 2 Par Value Book Value Maturity Date Stated RateMarket Value April 30, 2019 Portfolio Details - Investments Average BalanceIssuer Portfolio Management City of La Quinta YTM 365TermCUSIPInvestment # Purchase Date 22,327,800.00 1,47522,235,977.0022,400,000.0022,558,916.67Subtotal and Average 766 1.898 Treasury Coupon Securities 791U.S. Treasury1045 5,000,000.00 5,000,000.00 06/30/20211.12507/18/2016 4,881,450.00 1,808912828S27 1.125 335U.S. Treasury1068 2,500,000.00 2,483,250.00 03/31/20201.37503/20/2017 2,476,475.00 1,107912828J84 1.602 228U.S. Treasury1069 2,500,000.00 2,490,750.00 12/15/20191.37503/20/2017 2,483,500.00 1,000912828U73 1.513 914U.S. Treasury1070 2,000,000.00 1,942,800.00 10/31/20211.25003/27/2017 1,951,480.00 1,679912828T67 1.903 472U.S. Treasury1117 1,000,000.00 985,800.00 08/15/20201.50001/22/2018 989,340.00 9369128282Q2 2.071 30U.S. Treasury1130 1,000,000.00 992,600.00 05/31/20191.50005/10/2018 999,240.00 386912828WL0 2.211 365U.S. Treasury1138 500,000.00 488,250.00 04/30/20201.12505/31/2018 493,790.00 700912828VA5 2.387 1,248U.S. Treasury1178 500,000.00 489,687.50 09/30/20221.87503/01/2019 493,965.00 1,3099128282W9 2.480 14,873,137.50 1,33314,769,240.0015,000,000.0014,873,137.50Subtotal and Average 566 1.593 Certificate of Deposits 19First Business Bank1019 240,000.00 240,000.00 05/20/20191.75005/20/2014 239,930.40 1,82631938QH72 1.751 204First Farmers Bank &Trust Co.1091 240,000.00 240,000.00 11/21/20191.65007/21/2017 239,008.80 853320165HX4 1.653 1,541First National Bank of America1147 245,000.00 245,000.00 07/20/20233.15007/20/2018 248,650.50 1,82632110YLK9 3.152 1,465First National Bank1179 248,000.00 248,000.00 05/05/20232.80003/05/2019 248,367.04 1,52232117BCX4 2.802 931First Source Bank1168 245,000.00 245,000.00 11/17/20213.15012/17/2018 248,618.65 1,06633646CKP8 3.153 537First Tech Federal Credit Unio1124 245,000.00 245,000.00 10/19/20202.70004/18/2018 245,850.15 91533715LBJ8 2.623 1,006Third Federal Savings and Loan1112 245,000.00 245,000.00 01/31/20222.50001/30/2018 244,480.60 1,46288413QBY3 2.502 1,139Allegiance Bank1143 245,000.00 245,000.00 06/13/20223.10006/13/2018 248,407.95 1,46101748DBE5 3.102 1,261Alliance Credit Union1095 245,000.00 245,000.00 10/13/20222.25010/13/2017 241,530.80 1,82601859BAA3 2.251 677Ally Bank Midvale1176 245,000.00 245,000.00 03/08/20212.50003/07/2019 245,142.10 73202007GHX4 2.016 719Amex Centurion1077 240,000.00 240,000.00 04/19/20212.25004/19/2017 238,322.40 1,46102587DP85 2.252 1,216American Express Fed Savings B1096 240,000.00 240,000.00 08/29/20222.40008/29/2017 236,599.20 1,82602587CFU9 2.402 1,421Aneca Federal Credit Union1119 245,000.00 245,000.00 03/22/20232.80003/22/2018 245,494.90 1,826034577AH9 2.802 1,273Barclays Bank1097 240,000.00 240,000.00 10/25/20222.30010/25/2017 236,930.40 1,82606740KLJ4 2.291 1,703Bar Harbor Bank and Trust1172 248,000.00 248,000.00 12/29/20233.35012/31/2018 253,887.52 1,824066851WJ1 3.352 936Belmont Savings Bank1102 245,000.00 245,000.00 11/22/20212.10011/21/2017 242,258.45 1,462080515CD9 2.101 1,030BMW Bank1067 240,000.00 240,000.00 02/24/20222.20002/24/2017 237,470.40 1,82605580AGK4 2.201 624Bankers Bank1086 240,000.00 240,000.00 01/14/20211.80007/14/2017 237,340.80 1,28006610RAP4 1.804 768Capital One Natl Assn FDIC42971082 240,000.00 240,000.00 06/07/20212.25006/07/2017 238,845.60 1,46114042RGD7 2.252 406Capital One USA FDIC339541006 245,000.00 245,000.00 06/10/20201.90006/10/2015 243,652.50 1,827140420RX0 1.902 663Comenity Capital Bank1009 240,000.00 240,000.00 02/22/20211.70002/22/2016 236,745.60 1,82720033APG5 1.702 1,441Citibank NA1123 245,000.00 245,000.00 04/11/20232.90004/11/2018 246,342.60 1,82617312QJ26 2.902 23City National Bank of Florida1132 240,000.00 240,000.00 05/24/20192.20005/24/2018 239,983.20 36517801DDT0 2.200 Portfolio CITY CP Run Date: 08/28/2019 - 12:45 PM (PRF_PM2) 7.3.0 Days to Maturity Page 3 Par Value Book Value Maturity Date Stated RateMarket Value April 30, 2019 Portfolio Details - Investments Average BalanceIssuer Portfolio Management City of La Quinta YTM 365TermCUSIPInvestment # Purchase Date Certificate of Deposits 805Central State Bank1085 240,000.00 240,000.00 07/14/20211.85007/14/2017 236,656.80 1,46115523RBJ4 1.851 1,659Commercial Bank1162 248,000.00 248,000.00 11/15/20233.40011/15/2018 254,358.72 1,82620143PDV9 3.402 1,458Congressional Bank1189 248,000.00 248,000.00 04/28/20232.50004/30/2019 245,569.60 1,45920726ABA5 2.502 35Connect One1011 248,000.00 248,000.00 06/05/20191.50006/05/2015 247,848.72 1,46120786ABD6 1.501 1,297CrossFirst Bank1106 245,000.00 245,000.00 11/18/20222.20011/20/2017 240,893.80 1,82422766ACB9 2.201 1,007Discover Bank Greenwood DE CF1066 240,000.00 240,000.00 02/01/20222.25002/01/2017 237,900.00 1,8262546722U1 2.251 265Douglas National Bank1093 240,000.00 240,000.00 01/21/20201.65007/19/2017 238,668.00 916259744DS6 1.655 630Eagle Bank1146 245,000.00 245,000.00 01/20/20212.85007/20/2018 246,590.05 91527002YDV5 2.858 1,458EnerBank USA1125 240,000.00 240,000.00 04/28/20232.95004/30/2018 241,730.40 1,82429278TAY6 2.952 1,307Enterprise Bank, NA1107 245,000.00 245,000.00 11/28/20222.15011/28/2017 240,416.05 1,82629367QCP1 2.151 401EverBank1017248,000.00 248,000.00 06/05/20201.70006/05/2015 245,986.24 1,82729976DXX3 1.702 628Farm Bureau Bank1165 248,000.00 248,000.00 01/18/20213.00012/17/2018 250,229.52 763307660LC2 2.898 1,094Farmers Insurance Group FCU1126 240,000.00 240,000.00 04/29/20222.80004/30/2018 241,281.60 1,46030960QAG2 2.802 601Freedom Credit Union1111 245,000.00 245,000.00 12/22/20202.05012/22/2017 243,373.20 1,09635638BAA9 2.052 19Gulf Coast Bank1024 240,000.00 240,000.00 05/20/20191.75005/19/2014 239,932.80 1,827402194EB6 1.724 838General Electric Credit Union1150 240,000.00 240,000.00 08/16/20213.10008/15/2018 243,139.20 1,097369674AV8 3.100 1,091Goldman Sachs1078 240,000.00 240,000.00 04/26/20222.40004/26/2017 238,531.20 1,82638148PJK4 2.401 439First Bank of Highland1094 240,000.00 240,000.00 07/13/20201.75007/13/2017 238,000.80 1,096319141GT8 1.752 1,170HSBC Bank USA, National Associ1088 240,000.00 240,000.00 07/14/20222.30007/14/2017 237,477.60 1,82640434YLE5 2.301 1,632Jefferson Financial CU1154 245,000.00 245,000.00 10/19/20233.35010/19/2018 250,703.60 1,826474067AQ8 3.352 377Jefferson Bank & Trust1100 245,000.00 245,000.00 05/12/20201.75011/09/2017 243,253.15 915472376AC6 1.751 1,112Kansas State Bank1101 245,000.00 245,000.00 05/17/20222.10011/17/2017 241,261.30 1,64250116CBE8 2.099 1,338Knoxville TVA Credit Union1110 245,000.00 245,000.00 12/29/20222.40012/29/2017 242,341.75 1,826499724AB8 2.401 1,034Maine Savings FCU1171 248,000.00 248,000.00 02/28/20223.30012/28/2018 252,791.36 1,158560507AK1 3.306 1,822Main Street Bank1188 248,000.00 248,000.00 04/26/20242.60004/26/2019 245,358.80 1,82756065GAG3 2.603 1,630Marlin Business Bank1155 248,000.00 248,000.00 10/17/20233.30010/17/2018 253,274.96 1,82657116ARV2 3.302 1,316Medallion Bank1169 248,000.00 248,000.00 12/07/20223.40012/07/2018 253,929.68 1,46158404DCX7 3.402 433Mercantile Bank of Michigan1087 240,000.00 240,000.00 07/07/20201.75007/07/2017 238,029.60 1,09658740XZL7 1.752 408Bank Midwest1002 248,000.00 248,000.00 06/12/20201.65006/12/2015 245,810.16 1,827063615AVO 1.652 201Morgan Stanley Bank1109 245,000.00 245,000.00 11/18/20191.80011/16/2017 244,208.65 73261747MA92 1.800 1,511Morton Community1173 248,000.00 248,000.00 06/20/20232.75003/20/2019 247,809.04 1,553619165JD6 2.753 1,276Merrick Bank1163 248,000.00 248,000.00 10/28/20223.25010/30/2018 252,657.44 1,45959013J4K2 3.252 201Morgan Stanley Private Bk, NA1108 245,000.00 245,000.00 11/18/20191.75011/16/2017 244,142.50 73261760AEP0 1.750 1,287Mountain America Federal CU1099 245,000.00 245,000.00 11/08/20222.30011/08/2017 241,783.15 1,82662384RAC0 2.301 1,630Municipal Trust and Savings1160 245,000.00 245,000.00 10/17/20233.20010/17/2018 249,184.60 1,826625925AR3 3.202 965Neighbors FCU1167 245,000.00 245,000.00 12/21/20213.20012/21/2018 248,959.20 1,09664017AAQ7 3.203 Portfolio CITY CP Run Date: 08/28/2019 - 12:45 PM (PRF_PM2) 7.3.0 Days to Maturity Page 4 Par Value Book Value Maturity Date Stated RateMarket Value April 30, 2019 Portfolio Details - Investments Average BalanceIssuer Portfolio Management City of La Quinta YTM 365TermCUSIPInvestment # Purchase Date Certificate of Deposits 1,695National Cooperative Bank, N.A1170 245,000.00 245,000.00 12/21/20233.40012/21/2018 251,298.95 1,826635573AL2 3.402 1,672Numerica Credit Union1164 248,000.00 248,000.00 11/28/20233.55011/28/2018 255,975.68 1,82667054NAN3 3.552 909Northpointe Bank1127 240,000.00 240,000.00 10/26/20212.70004/26/2018 240,919.20 1,279666613GV0 2.703 1,749Northwest Bank1181 248,000.00 248,000.00 02/13/20242.95002/13/2019 249,492.96 1,82666736ABP3 2.951 1,552Bank of New England1151 249,000.00 249,000.00 07/31/20233.25007/31/2018 253,713.57 1,82606426KAN8 3.252 994The Ohio Valley Bank1089 240,000.00 240,000.00 01/19/20221.90007/19/2017 235,749.60 1,645677721CN0 1.903 1,134PCSB Bank1149 245,000.00 245,000.00 06/08/20223.00006/08/2018 247,697.45 1,46169324MAD7 3.002 27Peapack-Gladstone Bank1031 240,000.00 240,000.00 05/28/20191.80005/28/2014 239,952.00 1,826704692AL6 1.801 756PrivateBank & Trust1032 240,000.00 240,000.00 05/26/20211.50005/26/2016 235,752.00 1,82674267GVG9 1.501 1,511RCB Bank1144 245,000.00 245,000.00 06/20/20233.15006/20/2018 248,638.25 1,82674934YAH4 3.152 1,316Red Rocks Credit Union1166 248,000.00 248,000.00 12/07/20223.35012/07/2018 253,503.12 1,46175701LAB3 3.352 572First Bank Richmond1081 245,000.00 245,000.00 11/23/20201.80006/21/2017 242,510.80 1,251319267GC8 1.802 127Riverwood1034248,000.00 248,000.00 09/05/20191.40006/05/2015 247,444.48 1,55376951DAL4 1.402 1,147Sallie Mae Bank Salt Lake CIty1083 240,000.00 240,000.00 06/21/20222.35006/21/2017 237,940.80 1,826795450A70 2.351 34Solomon State1035 248,000.00 248,000.00 06/04/20191.40006/04/2015 247,853.68 1,46183427LAX2 1.401 356Stearnes Bank, N.A.1076 240,000.00 240,000.00 04/21/20201.60004/21/2017 238,041.60 1,096857894TC3 1.588 1,128Synchrony Bank Retail1080 240,000.00 240,000.00 06/02/20222.40006/02/2017 238,382.40 1,82687164XQV1 2.401 730Towne Bank1128 240,000.00 240,000.00 04/30/20212.80004/30/2018 241,543.20 1,09689214PBL2 2.803 1,195Traditions Bank1148 245,000.00 245,000.00 08/08/20223.00006/08/2018 247,648.45 1,52289269CBX9 3.002 1,630UBS Bank USA1161 245,000.00 245,000.00 10/17/20233.35010/17/2018 250,725.65 1,82690348JEJ5 3.352 15Union BankNA1136 240,000.00 240,000.00 05/16/20192.20005/16/2018 239,988.00 36590521AQW1 2.200 685Unity Bank1120 245,000.00 245,000.00 03/16/20212.55003/16/2018 245,369.95 1,09691330ABN6 2.552 1,475University of Iowa Comm. CU1134 240,000.00 240,000.00 05/15/20233.05005/14/2018 242,632.80 1,82791435LAG2 3.052 1,399Verus Bank of Commerce1180 248,000.00 248,000.00 02/28/20232.70002/28/2019 247,677.60 1,46192535LCD4 2.700 1,763Wells Fargo1174 248,000.00 248,000.00 02/27/20243.00002/27/2019 249,557.44 1,826949763XY7 3.001 411Wex Bank1145 245,000.00 245,000.00 06/15/20202.75006/13/2018 245,801.15 73392937CHG6 2.754 20,737,000.00 1,48620,763,754.5820,737,000.0020,682,066.67Subtotal and Average 960 2.474 Corporate Notes 826Apple Inc1079 500,000.00 493,050.00 08/04/20211.55006/12/2017 489,490.00 1,514037833CC2 1.900 1,372Colgate-Palmolive1175 500,000.00 485,250.00 02/01/20231.95003/04/2019 491,075.00 1,43019416QEA4 2.751 281Microsoft Corporation1118 500,000.00 497,700.00 02/06/20201.85001/22/2018 497,440.00 745594918BV5 2.081 1,560Microsoft Corporation1157 400,000.00 378,360.00 08/08/20232.00010/15/2018 390,640.00 1,758594918BQ6 3.222 1,012Proctor and Gamble1159 500,000.00 487,950.00 02/06/20222.30010/15/2018 497,585.00 1,210742718DY2 3.071 170Toyota Motor Credit Corp1098 500,000.00 498,750.00 10/18/20191.55011/07/2017 497,380.00 71089236TDH5 1.681 1,324Wal-Mart Stores, Inc1190 500,000.00 496,650.00 12/15/20222.35004/16/2019 496,120.00 1,339931142DU4 2.799 Portfolio CITY CP Run Date: 08/28/2019 - 12:45 PM (PRF_PM2) 7.3.0 Days to Maturity Page 5 Par Value Book Value Maturity Date Stated RateMarket Value April 30, 2019 Portfolio Details - Investments Average BalanceIssuer Portfolio Management City of La Quinta YTM 365TermCUSIPInvestment # Purchase Date 3,337,710.00 1,2243,359,730.003,400,000.003,089,385.00Subtotal and Average 911 2.473 Money Market Accounts 1California Asset Management Pr1153 11,466,785.63 11,466,785.6309/26/2018 11,466,785.63 1SYS1153 0.000 11,466,785.63 111,466,785.6311,466,785.639,780,307.32Subtotal and Average 1 0.000 Money Market with Fiscal Agent 1US Bank1058 1,668.83 1,668.8307/01/2016 1,668.83 1SYS1058 0.000 1,668.83 11,668.831,668.831,666.66Subtotal and Average 1 0.000 Managed Pool Accounts-OPEB Trust 1CalPERS CERBT Plan1114 1,574,839.50 1,574,839.5007/01/2018 1,574,839.50 1SYS1114 0.000 1,574,839.50 11,574,839.501,574,839.501,574,839.50Subtotal and Average 1 0.000 607140,905,811.82 144,944,382.85 336 1.981144,399,114.10 144,683,030.35Total and Average Portfolio CITY CP Run Date: 08/28/2019 - 12:45 PM (PRF_PM2) 7.3.0 City of La QuintaTotal EarningsCity of La Quinta -Sorted by Fund - FundApril 1, 2019 - April 30, 2019CurrentRateEndingPar ValueEndingFundBook ValueBeginningBook ValueAdjusted Interest EarningsAccretionAmortization/EarningsAdjusted InterestAnnualizedYieldCUSIP Investment #InterestEarnedIssuerRealizedGainl/LossFund: General Fund248,000.001002 248,000.00 1.650MIDWES336.33 0.00 336.331.650101 248,000.00063615AVO0.00245,000.001006 245,000.00 1.900CAPONE382.61 0.00 382.611.900101 245,000.00140420RX00.00240,000.001009 240,000.00 1.700CCBA335.34 0.00 335.341.700101 240,000.0020033APG50.00248,000.001011 248,000.00 1.500CONNEC305.75 0.00 305.751.500101 248,000.0020786ABD60.000.001016 0.00 1.650EPHRAT314.63 0.00 314.631.650101 240,000.00294209AQ40.00248,000.001017 248,000.00 1.700EVRBA346.52 0.00 346.521.700101 248,000.0029976DXX30.00240,000.001019 240,000.00 1.7501STBUS345.21 0.00 345.211.750101 240,000.0031938QH720.00240,000.001024 240,000.00 1.750GCB345.20 0.00 345.201.750101 240,000.00402194EB60.00240,000.001031 240,000.00 1.800PEAPAC355.06 0.00 355.061.800101 240,000.00704692AL60.00240,000.001032 240,000.00 1.500PRVTBA295.89 0.00 295.891.500101 240,000.0074267GVG90.00248,000.001034 248,000.00 1.400RVRW285.37 0.00 285.371.400101 248,000.0076951DAL40.00248,000.001035 248,000.00 1.400SOLOM285.37 0.00 285.371.400101 248,000.0083427LAX20.000.001042 0.00 1.800WEB260.39 0.00 260.391.800101 240,000.0094768NJQ80.005,000,000.001045 5,000,000.00 1.125USTR4,661.61 0.00 4,661.611.134101 5,000,000.00912828S270.002,491,250.001053 2,500,000.00 1.350FHLB2,812.50 0.00 2,812.501.374101 2,491,250.003130A7QZ10.002,500,000.001054 2,500,000.00 1.500FHLMC3,125.00 0.00 3,125.001.521101 2,500,000.003134G8Y370.0049,505,436.601055 49,505,436.60 2.445LAIF98,840.31 0.00 98,840.312.436101 49,193,701.7898-33-4340.004,489,649.561057 4,489,649.56WELLS0.01 0.00 0.01101 2,667,328.4341592824820.003,300.001059 3,300.00CITYPC0.00 0.00 0.00101 3,300.00SYS10590.002,500,000.001064 2,500,000.00 1.375FHLB2,864.58 0.00 2,864.581.394101 2,500,000.003130A9UQ20.00240,000.001066 240,000.00 2.250DISCOV443.83 0.00 443.832.250101 240,000.002546722U10.00240,000.001067 240,000.00 2.200BMW433.97 0.00 433.972.200101 240,000.0005580AGK40.002,483,250.001068 2,500,000.00 1.375USTR2,817.62 0.00 2,817.621.380101 2,483,250.00912828J840.002,490,750.001069 2,500,000.00 1.375USTR2,833.10 0.00 2,833.101.384101 2,490,750.00912828U730.001,942,800.001070 2,000,000.00 1.250USTR2,070.69 0.00 2,070.691.297101 1,942,800.00912828T670.002,000,000.001072 2,000,000.00 1.700FNMA2,833.34 0.00 2,833.341.724101 2,000,000.003135G0S530.001,990,000.001073 2,000,000.00 2.000FHLMC3,333.34 0.00 3,333.342.038101 1,990,000.003134GBAE20.00240,000.001076 240,000.00 1.600STRNS315.61 0.00 315.611.600101 240,000.00857894TC30.00240,000.001077 240,000.00 2.250AMEX443.83 0.00 443.832.250101 240,000.0002587DP850.00240,000.001078 240,000.00 2.400GLDMAN473.42 0.00 473.422.400101 240,000.0038148PJK40.00Portfolio CITYCPRun Date: 10/09/2019 - 11:32TE (PRF_TE) 7.3.6Report Ver. 7.3.6.1 CurrentRateEndingPar ValueEndingFundPage 2Book ValueBeginningBook ValueAdjusted Interest EarningsAccretionAmortization/EarningsAdjusted InterestApril 1, 2019 - April 30, 2019Total EarningsCity of La QuintaAnnualizedYieldCUSIP Investment #InterestEarnedIssuerRealizedGainl/LossFund: General Fund493,050.001079 500,000.00 1.550APPL645.84 0.00 645.841.594101 493,050.00037833CC20.00240,000.001080 240,000.00 2.400SYNCHR473.42 0.00 473.422.400101 240,000.0087164XQV10.00245,000.001081 245,000.00 1.800RICHMN362.47 0.00 362.471.800101 245,000.00319267GC80.00240,000.001082 240,000.00 2.250CAP1NA443.83 0.00 443.832.250101 240,000.0014042RGD70.00240,000.001083 240,000.00 2.350SALMAE463.57 0.00 463.572.350101 240,000.00795450A700.00999,500.001084 1,000,000.00 2.000FHLMC1,666.66 0.00 1,666.662.029101 999,500.003134GBXF40.00240,000.001085 240,000.00 1.850CNTRL364.94 0.00 364.941.850101 240,000.0015523RBJ40.00240,000.001086 240,000.00 1.800BNKRS355.06 0.00 355.061.800101 240,000.0006610RAP40.00240,000.001087 240,000.00 1.750MERCTL345.20 0.00 345.201.750101 240,000.0058740XZL70.00240,000.001088 240,000.00 2.300HSBC453.70 0.00 453.702.300101 240,000.0040434YLE50.00240,000.001089 240,000.00 1.900OHVAL374.79 0.00 374.791.900101 240,000.00677721CN00.001,000,000.001090 1,000,000.00 2.150FHLMC1,791.67 0.00 1,791.672.180101 1,000,000.003134GBWG30.00240,000.001091 240,000.00 1.6501STFRM325.48 0.00 325.481.650101 240,000.00320165HX40.00992,600.001092 1,000,000.00 1.080FFCB900.00 0.00 900.001.103101 992,600.003133EGLC70.00240,000.001093 240,000.00 1.650DOUGLS325.48 0.00 325.481.650101 240,000.00259744DS60.00240,000.001094 240,000.00 1.750HIGHLD345.21 0.00 345.211.750101 240,000.00319141GT80.00245,000.001095 245,000.00 2.250ALLIAN453.08 0.00 453.082.250101 245,000.0001859BAA30.00240,000.001096 240,000.00 2.400AMFSB473.42 0.00 473.422.400101 240,000.0002587CFU90.00240,000.001097 240,000.00 2.300BARCLY453.70 0.00 453.702.300101 240,000.0006740KLJ40.00498,750.001098 500,000.00 1.550TOYOTA645.83 0.00 645.831.575101 498,750.0089236TDH50.00245,000.001099 245,000.00 2.300MTNAMR463.16 0.00 463.162.300101 245,000.0062384RAC00.00245,000.001100 245,000.00 1.750JFFRSN352.40 0.00 352.401.750101 245,000.00472376AC60.00245,000.001101 245,000.00 2.100KANSAS422.88 0.00 422.882.100101 245,000.0050116CBE80.00245,000.001102 245,000.00 2.100BELMNT422.87 0.00 422.872.100101 245,000.00080515CD90.00996,800.001104 1,000,000.00 1.625FHLB1,354.16 0.00 1,354.161.653101 996,800.003130A66T90.00992,200.001105 1,000,000.00 1.700FFCB1,416.66 0.00 1,416.661.737101 992,200.003133EHWM10.00245,000.001106 245,000.00 2.200CRS1ST443.02 0.00 443.022.200101 245,000.0022766ACB90.00245,000.001107 245,000.00 2.150ENTRPR432.94 0.00 432.942.150101 245,000.0029367QCP10.00245,000.001108 245,000.00 1.750MSPRIV352.40 0.00 352.401.750101 245,000.0061760AEP00.00245,000.001109 245,000.00 1.800MORGST362.46 0.00 362.461.800101 245,000.0061747MA920.00245,000.001110 245,000.00 2.400KNOX483.29 0.00 483.292.400101 245,000.00499724AB80.00245,000.001111 245,000.00 2.050FREECU412.81 0.00 412.812.050101 245,000.0035638BAA90.00245,000.001112 245,000.00 2.5003RD503.42 0.00 503.422.500101 245,000.0088413QBY30.001,574,839.501114 1,574,839.50CALPRS0.00 0.00 0.00101 1,574,839.50SYS11140.001,000,000.001116 1,000,000.00 2.550FHLMC2,125.00 0.00 2,125.002.585101 1,000,000.003134GSCD50.00985,800.001117 1,000,000.00 1.500USTR1,243.09 0.00 1,243.091.534101 985,800.009128282Q20.00497,700.001118 500,000.00 1.850MCRSFT770.84 0.00 770.841.884101 497,700.00594918BV50.00Portfolio CITYCPRun Date: 10/09/2019 - 11:32TE (PRF_TE) 7.3.6Report Ver. 7.3.6.1 CurrentRateEndingPar ValueEndingFundPage 3Book ValueBeginningBook ValueAdjusted Interest EarningsAccretionAmortization/EarningsAdjusted InterestApril 1, 2019 - April 30, 2019Total EarningsCity of La QuintaAnnualizedYieldCUSIP Investment #InterestEarnedIssuerRealizedGainl/LossFund: General Fund245,000.001119 245,000.00 2.800ANECA563.83 0.00 563.832.800101 245,000.00034577AH90.00245,000.001120 245,000.00 2.550UNITY513.49 0.00 513.492.550101 245,000.0091330ABN60.00999,000.001121 1,000,000.00 2.625FHLB2,187.50 0.00 2,187.502.664101 999,000.003130ADMF60.00746,625.001122 750,000.00 2.750FHLMC1,718.75 0.00 1,718.752.801101 746,625.003134GSCQ60.00245,000.001123 245,000.00 2.900CITINA583.98 0.00 583.982.900101 245,000.0017312QJ260.00245,000.001124 245,000.00 2.7001STTCH543.70 0.00 543.702.700101 245,000.0033715LBJ80.00240,000.001125 240,000.00 2.950ENER581.92 0.00 581.922.950101 240,000.0029278TAY60.00240,000.001126 240,000.00 2.800FARMIG552.33 0.00 552.332.800101 240,000.0030960QAG20.00240,000.001127 240,000.00 2.700NORPNT532.60 0.00 532.602.700101 240,000.00666613GV00.00240,000.001128 240,000.00 2.800TOWNE552.33 0.00 552.332.800101 240,000.0089214PBL20.000.001129 0.00 1.125FHLMC218.75 0.00 4,968.751.152101 495,250.003137EADZ94,750.00992,600.001130 1,000,000.00 1.500USTR1,236.27 0.00 1,236.271.515101 992,600.00912828WL00.00240,000.001132 240,000.00 2.200CNBF433.97 0.00 433.972.200101 240,000.0017801DDT00.00240,000.001134 240,000.00 3.050UOFICU601.64 0.00 601.643.050101 240,000.0091435LAG20.00240,000.001136 240,000.00 2.200UNION433.97 0.00 433.972.200101 240,000.0090521AQW10.00488,250.001138 500,000.00 1.125USTR465.91 0.00 465.911.161101 488,250.00912828VA50.00496,700.001139 500,000.00 1.750FNMA729.16 0.00 729.161.786101 496,700.003135G0ZG10.00492,000.001140 500,000.00 0.875FNMA364.59 0.00 364.590.902101 492,000.003135G0N330.00494,750.001141 500,000.00 1.210FFCB504.17 0.00 504.171.240101 494,750.003133EGFU40.00491,750.001142 500,000.00 1.550FFCB645.84 0.00 645.841.598101 491,750.003133EHJA20.00245,000.001143 245,000.00 3.100ALLGNC624.25 0.00 624.253.100101 245,000.0001748DBE50.00245,000.001144 245,000.00 3.150RCB634.31 0.00 634.313.150101 245,000.0074934YAH40.00245,000.001145 245,000.00 2.750WEX553.77 0.00 553.772.750101 245,000.0092937CHG60.00245,000.001146 245,000.00 2.850EAGLE573.91 0.00 573.912.850101 245,000.0027002YDV50.00245,000.001147 245,000.00 3.1501STNBA634.32 0.00 634.323.150101 245,000.0032110YLK90.00245,000.001148 245,000.00 3.000TRAD604.11 0.00 604.113.000101 245,000.0089269CBX90.00245,000.001149 245,000.00 3.000PCSB604.11 0.00 604.113.000101 245,000.0069324MAD70.00240,000.001150 240,000.00 3.100GECRUN611.50 0.00 611.503.100101 240,000.00369674AV80.00249,000.001151 249,000.00 3.250NWENGL665.14 0.00 665.143.250101 249,000.0006426KAN80.0011,466,785.631153 11,466,785.63CAMP20,494.80 0.00 20,494.802.550101 9,446,290.83SYS11530.00245,000.001154 245,000.00 3.350JEFF674.59 0.00 674.593.350101 245,000.00474067AQ80.00248,000.001155 248,000.00 3.300MARBUS672.65 0.00 672.653.300101 248,000.0057116ARV20.00398,800.001156 400,000.00 3.000FHLMC1,000.00 0.00 1,000.003.051101 398,800.003134GSWS00.00378,360.001157 400,000.00 2.000MCRSFT666.66 0.00 666.662.144101 378,360.00594918BQ60.00247,275.001158 250,000.00 2.800FFCB583.33 0.00 583.332.870101 247,275.003133EJYL70.00487,950.001159 500,000.00 2.300P&G958.34 0.00 958.342.390101 487,950.00742718DY20.00245,000.001160 245,000.00 3.200MUNTRS644.38 0.00 644.383.200101 245,000.00625925AR30.00Portfolio CITYCPRun Date: 10/09/2019 - 11:32TE (PRF_TE) 7.3.6Report Ver. 7.3.6.1 CurrentRateEndingPar ValueEndingFundPage 4Book ValueBeginningBook ValueAdjusted Interest EarningsAccretionAmortization/EarningsAdjusted InterestApril 1, 2019 - April 30, 2019Total EarningsCity of La QuintaAnnualizedYieldCUSIP Investment #InterestEarnedIssuerRealizedGainl/LossFund: General Fund245,000.001161 245,000.00 3.350UBS674.59 0.00 674.593.350101 245,000.0090348JEJ50.00248,000.001162 248,000.00 3.400COMMBK693.04 0.00 693.043.400101 248,000.0020143PDV90.00248,000.001163 248,000.00 3.250MRRCK662.47 0.00 662.473.250101 248,000.0059013J4K20.00248,000.001164 248,000.00 3.550NMRCA723.61 0.00 723.613.550101 248,000.0067054NAN30.00248,000.001165 248,000.00 3.000FARMBU611.51 0.00 611.513.000101 248,000.00307660LC20.00248,000.001166 248,000.00 3.350REDRCK682.85 0.00 682.853.350101 248,000.0075701LAB30.00245,000.001167 245,000.00 3.200NEIGH644.39 0.00 644.393.200101 245,000.0064017AAQ70.00245,000.001168 245,000.00 3.1501STSRC634.32 0.00 634.323.150101 245,000.0033646CKP80.00248,000.001169 248,000.00 3.400MEDBA693.04 0.00 693.043.400101 248,000.0058404DCX70.00245,000.001170 245,000.00 3.400NLCOOP684.66 0.00 684.663.400101 245,000.00635573AL20.00248,000.001171 248,000.00 3.300MAINE672.66 0.00 672.663.300101 248,000.00560507AK10.00248,000.001172 248,000.00 3.350BARHAR682.85 0.00 682.853.350101 248,000.00066851WJ10.00248,000.001173 248,000.00 2.750MORTN560.55 0.00 560.552.750101 248,000.00619165JD60.00248,000.001174 248,000.00 3.000WELLS611.51 0.00 611.513.000101 248,000.00949763XY70.00485,250.001175 500,000.00 1.950COLGTE812.50 0.00 812.502.037101 485,250.0019416QEA40.00245,000.001176 245,000.00 2.500ALLY503.43 0.00 503.432.500101 245,000.0002007GHX40.00498,550.001177 500,000.00 2.500FHLB1,041.67 0.00 1,041.672.542101 498,550.003130AFW940.00489,687.501178 500,000.00 1.875USTR768.45 0.00 768.451.909101 489,687.509128282W90.00248,000.001179 248,000.00 2.8001STNBK570.74 0.00 570.742.800101 248,000.0032117BCX40.00248,000.001180 248,000.00 2.700VERUS550.36 0.00 550.362.700101 248,000.0092535LCD40.00248,000.001181 248,000.00 2.950NRTHWS601.31 0.00 601.312.950101 248,000.0066736ABP30.00-248,000.001183 -248,000.00STIFEL35.18 0.00 35.18-0.127101 119,279.88SYS11830.00248,000.001188 248,000.00 2.600MAINST70.66 0.00 70.662.600101 0.0056065GAG30.00248,000.001189 248,000.00 2.500CONGRS0.00 0.00 0.00101 0.0020726ABA50.00496,650.001190 500,000.00 2.350WALMRT489.58 0.00 489.582.399101 0.00931142DU40.00128,329,011.29Subtotal 128,067,658.792.156220,311.980.00215,561.98124,262,987.924,750.00Fund: 1st Empire Securities Cash Bal0.001060 0.00EMPIRE0.00 0.00 0.00102 0.00SYS10600.000.00Subtotal 0.000.000.000.000.000.00Fund: Fiscal Agent1,668.831058 1,668.83USBANK2.25 0.00 2.251.643231 1,666.58SYS10580.001,668.83Subtotal 1,668.831.6432.250.002.251,666.580.00Portfolio CITYCPRun Date: 10/09/2019 - 11:32TE (PRF_TE) 7.3.6Report Ver. 7.3.6.1 CurrentRateEndingPar ValueEndingFundPage 5Book ValueBeginningBook ValueAdjusted Interest EarningsAccretionAmortization/EarningsAdjusted InterestApril 1, 2019 - April 30, 2019Total EarningsCity of La QuintaAnnualizedYieldCUSIP Investment #InterestEarnedIssuerRealizedGainl/LossFund: Housing Authority : WSA and LQ249,851.301062 249,851.30LQPR0.00 0.00 0.00241 276,436.17SYS10620.00249,851.30Subtotal 249,851.300.000.000.00276,436.170.00Fund: SA Low/Mod Bond Fund16,363,851.431113 16,363,851.43 2.445LAIF32,672.29 0.00 32,672.292.436249 16,261,843.7325-33-0050.0016,363,851.43Subtotal 16,363,851.432.43632,672.290.0032,672.2916,261,843.730.00144,944,382.85Total 144,683,030.35 2.184252,986.520.00248,236.52140,802,934.404,750.00Portfolio CITYCPRun Date: 10/09/2019 - 11:32TE (PRF_TE) 7.3.6Report Ver. 7.3.6.1 Days to Maturity Page 1 Par Value Book Value Maturity Date Stated RateMarket Value May 31, 2019 Portfolio Details - Investments Average BalanceIssuer Portfolio Management City of La Quinta YTM 365TermCUSIPInvestment # Purchase Date Bank Accounts 1City Petty Cash1059 3,300.00 3,300.0007/01/2016 3,300.00 1SYS1059 0.000 1First Empire Bank1060 0.00 0.0007/01/2016 0.00 1SYS1060 0.000 1La Quinta Palms Realty1062 248,920.45 248,920.4507/01/2016 248,920.45 1SYS1062 0.000 1Stifel, Nicolaus & Company1183 0.00 0.0003/18/2019 0.00 1SYS1183 0.000 1Wells Fargo1057 3,090,085.49 3,090,085.4907/01/2016 3,090,085.49 14159282482 0.000 3,342,305.94 13,342,305.943,342,305.944,304,683.81Subtotal and Average 1 0.000 Local Agency Invstmnt Fund-Housing 1Local Agency Inv Fund1113 16,363,851.43 16,363,851.43 2.44916,319,382.05 125-33-005 2.449 16,363,851.43 116,319,382.0516,363,851.4316,363,851.43Subtotal and Average 1 2.449 Local Agency Investment Fund-City 1Local Agency Inv Fund1055 49,505,436.60 49,505,436.60 2.44949,412,935.65 198-33-434 2.449 49,505,436.60 149,412,935.6549,505,436.6049,505,436.60Subtotal and Average 1 2.449 Federal Agency Coupon Securities 41Federal Farm Credit Bank1092 1,000,000.00 992,600.00 07/12/20191.08007/10/2017 998,650.00 7323133EGLC7 1.456 823Federal Farm Credit Bank1105 1,000,000.00 992,200.00 09/01/20211.70011/09/2017 993,400.00 1,3923133EHWM1 1.913 19Federal Farm Credit Bank1141 500,000.00 494,750.00 06/20/20191.21005/31/2018 499,730.00 3853133EGFU4 2.224 342Federal Farm Credit Bank1142 500,000.00 491,750.00 05/08/20201.55005/31/2018 496,555.00 7083133EHJA2 2.427 1,557Federal Farm Credit Bank1158 250,000.00 247,275.00 09/05/20232.80010/15/2018 258,335.00 1,7863133EJYL7 3.041 1,249Federal Farm Credit Bank1191 500,000.00 492,100.00 11/01/20221.70005/28/2019 494,850.00 1,2533133EGD28 2.181 697Federal Home Loan Bank1053 2,500,000.00 2,491,250.00 04/28/20211.35004/28/2016 2,470,350.00 1,8263130A7QZ1 1.423 513Federal Home Loan Bank1064 2,500,000.00 2,500,000.00 10/26/20201.37510/26/2016 2,475,850.00 1,4613130A9UQ2 1.375 468Federal Home Loan Bank1104 1,000,000.00 996,800.00 09/11/20201.62511/09/2017 994,150.00 1,0373130A66T9 1.741 1,718Federal Home Loan Bank1177 500,000.00 498,550.00 02/13/20242.50003/01/2019 511,360.00 1,8103130AFW94 2.563 697Federal Home Loan Mtg Corp1054 2,500,000.00 2,500,000.00 04/28/20211.50004/28/2016 2,495,975.00 1,8263134G8Y37 1.400 1,032Federal Home Loan Mtg Corp1073 2,000,000.00 1,990,000.00 03/29/20222.00003/29/2017 1,999,780.00 1,8263134GBAE2 2.106 942Federal Home Loan Mtg Corp1084 1,000,000.00 999,500.00 12/29/20212.00007/06/2017 998,970.00 1,6373134GBXF4 2.012 1,152Federal Home Loan Mtg Corp1090 1,000,000.00 1,000,000.00 07/27/20222.15007/27/2017 1,000,130.00 1,8263134GBWG3 2.150 1,339Federal Home Loan Mtg Corp1116 1,000,000.00 1,000,000.00 01/30/20232.55001/30/2018 1,000,280.00 1,8263134GSCD5 2.550 1,363Federal Home Loan Mtg Corp1122 750,000.00 746,625.00 02/23/20232.75004/02/2018 751,005.00 1,7883134GSCQ6 2.849 1,214Federal Home Loan Mtg Corp1156 400,000.00 398,800.00 09/27/20223.00010/15/2018 400,944.00 1,4433134GSWS0 3.081 240Federal National Mtg Assn1072 2,000,000.00 2,000,000.00 01/27/20201.70003/27/2017 1,991,400.00 1,0363135G0S53 1.700 103Federal National Mtg Assn1139 500,000.00 496,700.00 09/12/20191.75005/31/2018 499,035.00 4693135G0ZG1 2.275 62Federal National Mtg Assn1140 500,000.00 492,000.00 08/02/20190.87505/31/2018 498,695.00 4283135G0N33 2.269 Portfolio CITY CP Run Date: 08/28/2019 - 12:57 PM (PRF_PM2) 7.3.0 Report Ver. 7.3.6.1 Days to Maturity Page 2 Par Value Book Value Maturity Date Stated RateMarket Value May 31, 2019 Portfolio Details - Investments Average BalanceIssuer Portfolio Management City of La Quinta YTM 365TermCUSIPInvestment # Purchase Date 21,820,900.00 1,45521,829,444.0021,900,000.0022,262,393.55Subtotal and Average 718 1.873 Treasury Coupon Securities 760U.S. Treasury1045 5,000,000.00 5,000,000.00 06/30/20211.12507/18/2016 4,918,950.00 1,808912828S27 1.125 304U.S. Treasury1068 2,500,000.00 2,483,250.00 03/31/20201.37503/20/2017 2,481,250.00 1,107912828J84 1.602 197U.S. Treasury1069 2,500,000.00 2,490,750.00 12/15/20191.37503/20/2017 2,487,025.00 1,000912828U73 1.513 883U.S. Treasury1070 2,000,000.00 1,942,800.00 10/31/20211.25003/27/2017 1,968,280.00 1,679912828T67 1.903 441U.S. Treasury1117 1,000,000.00 985,800.00 08/15/20201.50001/22/2018 992,310.00 9369128282Q2 2.071 334U.S. Treasury1138 500,000.00 488,250.00 04/30/20201.12505/31/2018 494,905.00 700912828VA5 2.387 1,217U.S. Treasury1178 500,000.00 489,687.50 09/30/20221.87503/01/2019 499,630.00 1,3099128282W9 2.480 1,079U.S. Treasury1192 500,000.00 496,650.00 05/15/20221.75005/31/2019 497,715.00 1,080912828SV3 1.984 730U.S. Treasury1193 500,000.00 493,610.00 05/31/20211.37505/31/2019 494,260.00 731912828R77 2.030 14,870,797.50 1,36814,834,325.0015,000,000.0014,873,062.02Subtotal and Average 595 1.579 Certificate of Deposits 173First Farmers Bank &Trust Co.1091 240,000.00 240,000.00 11/21/20191.65007/21/2017 239,138.40 853320165HX4 1.653 1,510First National Bank of America1147 245,000.00 245,000.00 07/20/20233.15007/20/2018 249,429.60 1,82632110YLK9 3.152 1,434First National Bank1179 248,000.00 248,000.00 05/05/20232.80003/05/2019 249,284.64 1,52232117BCX4 2.802 900First Source Bank1168 245,000.00 245,000.00 11/17/20213.15012/17/2018 248,675.00 1,06633646CKP8 3.153 506First Tech Federal Credit Unio1124 245,000.00 245,000.00 10/19/20202.70004/18/2018 245,764.40 91533715LBJ8 2.623 975Third Federal Savings and Loan1112 245,000.00 245,000.00 01/31/20222.50001/30/2018 244,811.35 1,46288413QBY3 2.502 1,108Allegiance Bank1143 245,000.00 245,000.00 06/13/20223.10006/13/2018 248,922.45 1,46101748DBE5 3.102 1,230Alliance Credit Union1095 245,000.00 245,000.00 10/13/20222.25010/13/2017 242,317.25 1,82601859BAA3 2.251 646Ally Bank Midvale1176 245,000.00 245,000.00 03/08/20212.50003/07/2019 245,041.65 73202007GHX4 2.016 688Amex Centurion1077 240,000.00 240,000.00 04/19/20212.25004/19/2017 238,336.80 1,46102587DP85 2.252 1,185American Express Fed Savings B1096 240,000.00 240,000.00 08/29/20222.40008/29/2017 237,393.60 1,82602587CFU9 2.402 1,390Aneca Federal Credit Union1119 245,000.00 245,000.00 03/22/20232.80003/22/2018 246,357.30 1,826034577AH9 2.802 1,242Barclays Bank1097 240,000.00 240,000.00 10/25/20222.30010/25/2017 237,703.20 1,82606740KLJ4 2.291 1,672Bar Harbor Bank and Trust1172 248,000.00 248,000.00 12/29/20233.35012/31/2018 254,445.52 1,824066851WJ1 3.352 905Belmont Savings Bank1102 245,000.00 245,000.00 11/22/20212.10011/21/2017 242,525.50 1,462080515CD9 2.101 999BMW Bank1067 240,000.00 240,000.00 02/24/20222.20002/24/2017 237,900.00 1,82605580AGK4 2.201 593Bankers Bank1086 240,000.00 240,000.00 01/14/20211.80007/14/2017 237,400.80 1,28006610RAP4 1.804 737Capital One Natl Assn FDIC42971082 240,000.00 240,000.00 06/07/20212.25006/07/2017 238,821.60 1,46114042RGD7 2.252 375Capital One USA FDIC339541006 245,000.00 245,000.00 06/10/20201.90006/10/2015 243,755.40 1,827140420RX0 1.902 632Comenity Capital Bank1009 240,000.00 240,000.00 02/22/20211.70002/22/2016 236,808.00 1,82720033APG5 1.702 1,811Century Next Bank1184 248,000.00 248,000.00 05/16/20242.50005/29/2019 244,542.88 1,814156634AK3 2.503 1,410Citibank NA1123 245,000.00 245,000.00 04/11/20232.90004/11/2018 247,209.90 1,82617312QJ26 2.902 Portfolio CITY CP Run Date: 08/28/2019 - 12:57 PM (PRF_PM2) 7.3.0 Days to Maturity Page 3 Par Value Book Value Maturity Date Stated RateMarket Value May 31, 2019 Portfolio Details - Investments Average BalanceIssuer Portfolio Management City of La Quinta YTM 365TermCUSIPInvestment # Purchase Date Certificate of Deposits 774Central State Bank1085 240,000.00 240,000.00 07/14/20211.85007/14/2017 236,752.80 1,46115523RBJ4 1.851 1,628Commercial Bank1162 248,000.00 248,000.00 11/15/20233.40011/15/2018 254,968.80 1,82620143PDV9 3.402 1,427Congressional Bank1189 248,000.00 248,000.00 04/28/20232.50004/30/2019 246,541.76 1,45920726ABA5 2.502 4Connect One1011 248,000.00 248,000.00 06/05/20191.50006/05/2015 247,977.68 1,46120786ABD6 1.501 1,266CrossFirst Bank1106 245,000.00 245,000.00 11/18/20222.20011/20/2017 241,726.80 1,82422766ACB9 2.201 976Discover Bank Greenwood DE CF1066 240,000.00 240,000.00 02/01/20222.25002/01/2017 238,272.00 1,8262546722U1 2.251 234Douglas National Bank1093 240,000.00 240,000.00 01/21/20201.65007/19/2017 238,819.20 916259744DS6 1.655 599Eagle Bank1146 245,000.00 245,000.00 01/20/20212.85007/20/2018 246,443.05 91527002YDV5 2.858 1,427EnerBank USA1125 240,000.00 240,000.00 04/28/20232.95004/30/2018 242,594.40 1,82429278TAY6 2.952 1,276Enterprise Bank, NA1107 245,000.00 245,000.00 11/28/20222.15011/28/2017 241,268.65 1,82629367QCP1 2.151 370EverBank1017248,000.00 248,000.00 06/05/20201.70006/05/2015 246,142.48 1,82729976DXX3 1.702 597Farm Bureau Bank1165 248,000.00 248,000.00 01/18/20213.00012/17/2018 250,053.44 763307660LC2 2.898 1,063Farmers Insurance Group FCU1126 240,000.00 240,000.00 04/29/20222.80004/30/2018 241,749.60 1,46030960QAG2 2.802 570Freedom Credit Union1111 245,000.00 245,000.00 12/22/20202.05012/22/2017 243,400.15 1,09635638BAA9 2.052 807General Electric Credit Union1150 240,000.00 240,000.00 08/16/20213.10008/15/2018 243,045.60 1,097369674AV8 3.100 1,060Goldman Sachs1078 240,000.00 240,000.00 04/26/20222.40004/26/2017 239,061.60 1,82638148PJK4 2.401 408First Bank of Highland1094 240,000.00 240,000.00 07/13/20201.75007/13/2017 238,132.80 1,096319141GT8 1.752 1,139HSBC Bank USA, National Associ1088 240,000.00 240,000.00 07/14/20222.30007/14/2017 238,152.00 1,82640434YLE5 2.301 1,818Iowa State Bank1186 245,000.00 245,000.00 05/23/20242.40005/23/2019 240,496.90 1,82746256YAZ2 2.403 1,601Jefferson Financial CU1154 245,000.00 245,000.00 10/19/20233.35010/19/2018 251,340.60 1,826474067AQ8 3.352 346Jefferson Bank & Trust1100 245,000.00 245,000.00 05/12/20201.75011/09/2017 243,395.25 915472376AC6 1.751 1,811JP Morgan Chase1185 245,000.00 245,000.00 05/16/20243.25005/16/2019 244,804.00 1,82748128HXU7 3.254 1,081Kansas State Bank1101 245,000.00 245,000.00 05/17/20222.10011/17/2017 241,908.10 1,64250116CBE8 2.099 1,307Knoxville TVA Credit Union1110 245,000.00 245,000.00 12/29/20222.40012/29/2017 243,184.55 1,826499724AB8 2.401 1,003Maine Savings FCU1171 248,000.00 248,000.00 02/28/20223.30012/28/2018 253,039.36 1,158560507AK1 3.306 1,791Main Street Bank1188 248,000.00 248,000.00 04/26/20242.60004/26/2019 245,869.68 1,82756065GAG3 2.603 1,599Marlin Business Bank1155 248,000.00 248,000.00 10/17/20233.30010/17/2018 253,939.60 1,82657116ARV2 3.302 1,285Medallion Bank1169 248,000.00 248,000.00 12/07/20223.40012/07/2018 254,584.40 1,46158404DCX7 3.402 402Mercantile Bank of Michigan1087 240,000.00 240,000.00 07/07/20201.75007/07/2017 238,164.00 1,09658740XZL7 1.752 377Bank Midwest1002 248,000.00 248,000.00 06/12/20201.65006/12/2015 245,968.88 1,827063615AVO 1.652 170Morgan Stanley Bank1109 245,000.00 245,000.00 11/18/20191.80011/16/2017 244,296.85 73261747MA92 1.800 1,480Morton Community1173 248,000.00 248,000.00 06/20/20232.75003/20/2019 248,694.40 1,553619165JD6 2.753 1,245Merrick Bank1163 248,000.00 248,000.00 10/28/20223.25010/30/2018 253,292.32 1,45959013J4K2 3.252 170Morgan Stanley Private Bk, NA1108 245,000.00 245,000.00 11/18/20191.75011/16/2017 244,238.05 73261760AEP0 1.750 1,256Mountain America Federal CU1099 245,000.00 245,000.00 11/08/20222.30011/08/2017 242,589.20 1,82662384RAC0 2.301 1,599Municipal Trust and Savings1160 245,000.00 245,000.00 10/17/20233.20010/17/2018 249,855.90 1,826625925AR3 3.202 Portfolio CITY CP Run Date: 08/28/2019 - 12:57 PM (PRF_PM2) 7.3.0 Days to Maturity Page 4 Par Value Book Value Maturity Date Stated RateMarket Value May 31, 2019 Portfolio Details - Investments Average BalanceIssuer Portfolio Management City of La Quinta YTM 365TermCUSIPInvestment # Purchase Date Certificate of Deposits 934Neighbors FCU1167 245,000.00 245,000.00 12/21/20213.20012/21/2018 249,071.90 1,09664017AAQ7 3.203 1,664National Cooperative Bank, N.A1170 245,000.00 245,000.00 12/21/20233.40012/21/2018 251,855.10 1,826635573AL2 3.402 1,641Numerica Credit Union1164 248,000.00 248,000.00 11/28/20233.55011/28/2018 256,543.60 1,82667054NAN3 3.552 878Northpointe Bank1127 240,000.00 240,000.00 10/26/20212.70004/26/2018 241,020.00 1,279666613GV0 2.703 1,718Northwest Bank1181 248,000.00 248,000.00 02/13/20242.95002/13/2019 250,055.92 1,82666736ABP3 2.951 1,521Bank of New England1151 249,000.00 249,000.00 07/31/20233.25007/31/2018 254,473.02 1,82606426KAN8 3.252 963The Ohio Valley Bank1089 240,000.00 240,000.00 01/19/20221.90007/19/2017 236,160.00 1,645677721CN0 1.903 1,103PCSB Bank1149 245,000.00 245,000.00 06/08/20223.00006/08/2018 248,226.65 1,46169324MAD7 3.002 725PrivateBank & Trust1032 240,000.00 240,000.00 05/26/20211.50005/26/2016 235,814.40 1,82674267GVG9 1.501 1,480RCB Bank1144 245,000.00 245,000.00 06/20/20233.15006/20/2018 249,446.75 1,82674934YAH4 3.152 1,285Red Rocks Credit Union1166 248,000.00 248,000.00 12/07/20223.35012/07/2018 254,167.76 1,46175701LAB3 3.352 541First Bank Richmond1081 245,000.00 245,000.00 11/23/20201.80006/21/2017 242,596.55 1,251319267GC8 1.802 96Riverwood1034248,000.00 248,000.00 09/05/20191.40006/05/2015 247,561.04 1,55376951DAL4 1.402 1,116Sallie Mae Bank Salt Lake CIty1083 240,000.00 240,000.00 06/21/20222.35006/21/2017 238,586.40 1,826795450A70 2.351 3Solomon State1035 248,000.00 248,000.00 06/04/20191.40006/04/2015 247,982.64 1,46183427LAX2 1.401 325Stearnes Bank, N.A.1076 240,000.00 240,000.00 04/21/20201.60004/21/2017 238,216.80 1,096857894TC3 1.588 1,097Synchrony Bank Retail1080 240,000.00 240,000.00 06/02/20222.40006/02/2017 239,001.60 1,82687164XQV1 2.401 699Towne Bank1128 240,000.00 240,000.00 04/30/20212.80004/30/2018 241,358.40 1,09689214PBL2 2.803 1,164Traditions Bank1148 245,000.00 245,000.00 08/08/20223.00006/08/2018 248,238.90 1,52289269CBX9 3.002 905TNB Bank1187 248,000.00 248,000.00 11/22/20212.40005/22/2019 247,278.32 91587266AAA1 2.407 1,599UBS Bank USA1161 245,000.00 245,000.00 10/17/20233.35010/17/2018 251,372.45 1,82690348JEJ5 3.352 654Unity Bank1120 245,000.00 245,000.00 03/16/20212.55003/16/2018 245,257.25 1,09691330ABN6 2.552 1,444University of Iowa Comm. CU1134 240,000.00 240,000.00 05/15/20233.05005/14/2018 243,472.80 1,82791435LAG2 3.052 1,368Verus Bank of Commerce1180 248,000.00 248,000.00 02/28/20232.70002/28/2019 248,545.60 1,46192535LCD4 2.700 1,732Wells Fargo1174 248,000.00 248,000.00 02/27/20243.00002/27/2019 249,862.48 1,826949763XY7 3.001 380Wex Bank1145 245,000.00 245,000.00 06/15/20202.75006/13/2018 245,739.90 73392937CHG6 2.754 20,523,000.00 1,50620,573,256.3220,523,000.0020,612,096.77Subtotal and Average 1,015 2.514 Corporate Notes 795Apple Inc1079 500,000.00 493,050.00 08/04/20211.55006/12/2017 492,460.00 1,514037833CC2 1.900 1,341Colgate-Palmolive1175 500,000.00 485,250.00 02/01/20231.95003/04/2019 495,560.00 1,43019416QEA4 2.751 250Microsoft Corporation1118 500,000.00 497,700.00 02/06/20201.85001/22/2018 498,310.00 745594918BV5 2.081 1,529Microsoft Corporation1157 400,000.00 378,360.00 08/08/20232.00010/15/2018 394,724.00 1,758594918BQ6 3.222 981Proctor and Gamble1159 500,000.00 487,950.00 02/06/20222.30010/15/2018 501,435.00 1,210742718DY2 3.071 139Toyota Motor Credit Corp1098 500,000.00 498,750.00 10/18/20191.55011/07/2017 498,235.00 71089236TDH5 1.681 1,293Wal-Mart Stores, Inc1190 500,000.00 496,650.00 12/15/20222.35004/16/2019 499,535.00 1,339931142DU4 2.799 Portfolio CITY CP Run Date: 08/28/2019 - 12:57 PM (PRF_PM2) 7.3.0 Days to Maturity Page 5 Par Value Book Value Maturity Date Stated RateMarket Value May 31, 2019 Portfolio Details - Investments Average BalanceIssuer Portfolio Management City of La Quinta YTM 365TermCUSIPInvestment # Purchase Date 3,337,710.00 1,2243,380,259.003,400,000.003,337,710.00Subtotal and Average 880 2.473 Money Market Accounts 1California Asset Management Pr1153 16,492,314.73 16,492,314.7309/26/2018 16,492,314.73 1SYS1153 0.000 16,492,314.73 116,492,314.7316,492,314.7311,951,480.12Subtotal and Average 1 0.000 Money Market with Fiscal Agent 1US Bank1058 1,671.27 1,671.2707/01/2016 1,671.27 1SYS1058 0.000 1,671.27 11,671.271,671.271,668.91Subtotal and Average 1 0.000 Managed Pool Accounts-OPEB Trust 1CalPERS CERBT Plan1114 1,574,839.50 1,574,839.5007/01/2018 1,574,839.50 1SYS1114 0.000 1,574,839.50 11,574,839.501,574,839.501,574,839.50Subtotal and Average 1 0.000 590144,787,222.70 148,103,419.47 327 1.931147,760,733.46 147,832,826.97Total and Average Portfolio CITY CP Run Date: 08/28/2019 - 12:57 PM (PRF_PM2) 7.3.0 City of La QuintaTotal EarningsCity of La Quinta -Sorted by Fund - FundMay 1, 2019 - May 31, 2019CurrentRateEndingPar ValueEndingFundBook ValueBeginningBook ValueAdjusted Interest EarningsAccretionAmortization/EarningsAdjusted InterestAnnualizedYieldCUSIP Investment #InterestEarnedIssuerRealizedGainl/LossFund: General Fund248,000.001002 248,000.00 1.650MIDWES347.54 0.00 347.541.650101 248,000.00063615AVO0.00245,000.001006 245,000.00 1.900CAPONE395.35 0.00 395.351.900101 245,000.00140420RX00.00240,000.001009 240,000.00 1.700CCBA346.52 0.00 346.521.700101 240,000.0020033APG50.00248,000.001011 248,000.00 1.500CONNEC315.94 0.00 315.941.500101 248,000.0020786ABD60.00248,000.001017 248,000.00 1.700EVRBA358.07 0.00 358.071.700101 248,000.0029976DXX30.000.001019 0.00 1.7501STBUS218.63 0.00 218.631.750101 240,000.0031938QH720.000.001024 0.00 1.750GCB218.63 0.00 218.631.750101 240,000.00402194EB60.000.001031 0.00 1.800PEAPAC319.57 0.00 319.571.800101 240,000.00704692AL60.00240,000.001032 240,000.00 1.500PRVTBA305.76 0.00 305.761.500101 240,000.0074267GVG90.00248,000.001034 248,000.00 1.400RVRW294.88 0.00 294.881.400101 248,000.0076951DAL40.00248,000.001035 248,000.00 1.400SOLOM294.89 0.00 294.891.400101 248,000.0083427LAX20.005,000,000.001045 5,000,000.00 1.125USTR4,816.98 0.00 4,816.981.134101 5,000,000.00912828S270.002,491,250.001053 2,500,000.00 1.350FHLB2,812.50 0.00 2,812.501.329101 2,491,250.003130A7QZ10.002,500,000.001054 2,500,000.00 1.500FHLMC3,125.00 0.00 3,125.001.472101 2,500,000.003134G8Y370.0049,505,436.601055 49,505,436.60 2.449LAIF102,807.20 0.00 102,807.202.445101 49,505,436.6098-33-4340.003,090,085.491057 3,090,085.49WELLS0.01 0.00 0.01101 4,489,649.5641592824820.003,300.001059 3,300.00CITYPC0.00 0.00 0.00101 3,300.00SYS10590.002,500,000.001064 2,500,000.00 1.375FHLB2,864.58 0.00 2,864.581.349101 2,500,000.003130A9UQ20.00240,000.001066 240,000.00 2.250DISCOV458.63 0.00 458.632.250101 240,000.002546722U10.00240,000.001067 240,000.00 2.200BMW448.44 0.00 448.442.200101 240,000.0005580AGK40.002,483,250.001068 2,500,000.00 1.375USTR2,911.55 0.00 2,911.551.380101 2,483,250.00912828J840.002,490,750.001069 2,500,000.00 1.375USTR2,927.54 0.00 2,927.541.384101 2,490,750.00912828U730.001,942,800.001070 2,000,000.00 1.250USTR2,105.98 0.00 2,105.981.276101 1,942,800.00912828T670.002,000,000.001072 2,000,000.00 1.700FNMA2,833.33 0.00 2,833.331.668101 2,000,000.003135G0S530.001,990,000.001073 2,000,000.00 2.000FHLMC3,333.33 0.00 3,333.331.972101 1,990,000.003134GBAE20.00240,000.001076 240,000.00 1.600STRNS326.14 0.00 326.141.600101 240,000.00857894TC30.00240,000.001077 240,000.00 2.250AMEX458.63 0.00 458.632.250101 240,000.0002587DP850.00240,000.001078 240,000.00 2.400GLDMAN489.21 0.00 489.212.400101 240,000.0038148PJK40.00493,050.001079 500,000.00 1.550APPL645.83 0.00 645.831.542101 493,050.00037833CC20.00240,000.001080 240,000.00 2.400SYNCHR489.21 0.00 489.212.400101 240,000.0087164XQV10.00Portfolio CITYCPRun Date: 10/09/2019 - 11:35TE (PRF_TE) 7.3.6Report Ver. 7.3.6.1 CurrentRateEndingPar ValueEndingFundPage 2Book ValueBeginningBook ValueAdjusted Interest EarningsAccretionAmortization/EarningsAdjusted InterestMay 1, 2019 - May 31, 2019Total EarningsCity of La QuintaAnnualizedYieldCUSIP Investment #InterestEarnedIssuerRealizedGainl/LossFund: General Fund245,000.001081 245,000.00 1.800RICHMN374.55 0.00 374.551.800101 245,000.00319267GC80.00240,000.001082 240,000.00 2.250CAP1NA458.63 0.00 458.632.250101 240,000.0014042RGD70.00240,000.001083 240,000.00 2.350SALMAE479.01 0.00 479.012.350101 240,000.00795450A700.00999,500.001084 1,000,000.00 2.000FHLMC1,666.67 0.00 1,666.671.963101 999,500.003134GBXF40.00240,000.001085 240,000.00 1.850CNTRL377.09 0.00 377.091.850101 240,000.0015523RBJ40.00240,000.001086 240,000.00 1.800BNKRS366.91 0.00 366.911.800101 240,000.0006610RAP40.00240,000.001087 240,000.00 1.750MERCTL356.71 0.00 356.711.750101 240,000.0058740XZL70.00240,000.001088 240,000.00 2.300HSBC468.82 0.00 468.822.300101 240,000.0040434YLE50.00240,000.001089 240,000.00 1.900OHVAL387.29 0.00 387.291.900101 240,000.00677721CN00.001,000,000.001090 1,000,000.00 2.150FHLMC1,791.67 0.00 1,791.672.110101 1,000,000.003134GBWG30.00240,000.001091 240,000.00 1.6501STFRM336.32 0.00 336.321.650101 240,000.00320165HX40.00992,600.001092 1,000,000.00 1.080FFCB900.00 0.00 900.001.068101 992,600.003133EGLC70.00240,000.001093 240,000.00 1.650DOUGLS336.33 0.00 336.331.650101 240,000.00259744DS60.00240,000.001094 240,000.00 1.750HIGHLD356.71 0.00 356.711.750101 240,000.00319141GT80.00245,000.001095 245,000.00 2.250ALLIAN468.18 0.00 468.182.250101 245,000.0001859BAA30.00240,000.001096 240,000.00 2.400AMFSB489.21 0.00 489.212.400101 240,000.0002587CFU90.00240,000.001097 240,000.00 2.300BARCLY468.82 0.00 468.822.300101 240,000.0006740KLJ40.00498,750.001098 500,000.00 1.550TOYOTA645.83 0.00 645.831.525101 498,750.0089236TDH50.00245,000.001099 245,000.00 2.300MTNAMR478.58 0.00 478.582.300101 245,000.0062384RAC00.00245,000.001100 245,000.00 1.750JFFRSN364.14 0.00 364.141.750101 245,000.00472376AC60.00245,000.001101 245,000.00 2.100KANSAS436.97 0.00 436.972.100101 245,000.0050116CBE80.00245,000.001102 245,000.00 2.100BELMNT436.98 0.00 436.982.100101 245,000.00080515CD90.00996,800.001104 1,000,000.00 1.625FHLB1,354.17 0.00 1,354.171.600101 996,800.003130A66T90.00992,200.001105 1,000,000.00 1.700FFCB1,416.67 0.00 1,416.671.681101 992,200.003133EHWM10.00245,000.001106 245,000.00 2.200CRS1ST457.78 0.00 457.782.200101 245,000.0022766ACB90.00245,000.001107 245,000.00 2.150ENTRPR447.38 0.00 447.382.150101 245,000.0029367QCP10.00245,000.001108 245,000.00 1.750MSPRIV364.15 0.00 364.151.750101 245,000.0061760AEP00.00245,000.001109 245,000.00 1.800MORGST374.55 0.00 374.551.800101 245,000.0061747MA920.00245,000.001110 245,000.00 2.400KNOX499.40 0.00 499.402.400101 245,000.00499724AB80.00245,000.001111 245,000.00 2.050FREECU426.56 0.00 426.562.050101 245,000.0035638BAA90.00245,000.001112 245,000.00 2.5003RD520.21 0.00 520.212.500101 245,000.0088413QBY30.001,574,839.501114 1,574,839.50CALPRS0.00 0.00 0.00101 1,574,839.50SYS11140.001,000,000.001116 1,000,000.00 2.550FHLMC2,125.00 0.00 2,125.002.502101 1,000,000.003134GSCD50.00985,800.001117 1,000,000.00 1.500USTR1,284.54 0.00 1,284.541.534101 985,800.009128282Q20.00497,700.001118 500,000.00 1.850MCRSFT770.83 0.00 770.831.824101 497,700.00594918BV50.00245,000.001119 245,000.00 2.800ANECA582.63 0.00 582.632.800101 245,000.00034577AH90.00245,000.001120 245,000.00 2.550UNITY530.61 0.00 530.612.550101 245,000.0091330ABN60.00Portfolio CITYCPRun Date: 10/09/2019 - 11:35TE (PRF_TE) 7.3.6Report Ver. 7.3.6.1 CurrentRateEndingPar ValueEndingFundPage 3Book ValueBeginningBook ValueAdjusted Interest EarningsAccretionAmortization/EarningsAdjusted InterestMay 1, 2019 - May 31, 2019Total EarningsCity of La QuintaAnnualizedYieldCUSIP Investment #InterestEarnedIssuerRealizedGainl/LossFund: General Fund0.001121 0.00 2.625FHLB1,968.75 0.00 2,968.752.664101 999,000.003130ADMF61,000.00746,625.001122 750,000.00 2.750FHLMC1,718.75 0.00 1,718.752.710101 746,625.003134GSCQ60.00245,000.001123 245,000.00 2.900CITINA603.43 0.00 603.432.900101 245,000.0017312QJ260.00245,000.001124 245,000.00 2.7001STTCH561.82 0.00 561.822.700101 245,000.0033715LBJ80.00240,000.001125 240,000.00 2.950ENER601.32 0.00 601.322.950101 240,000.0029278TAY60.00240,000.001126 240,000.00 2.800FARMIG570.74 0.00 570.742.800101 240,000.0030960QAG20.00240,000.001127 240,000.00 2.700NORPNT550.36 0.00 550.362.700101 240,000.00666613GV00.00240,000.001128 240,000.00 2.800TOWNE570.74 0.00 570.742.800101 240,000.0089214PBL20.000.001130 0.00 1.500USTR1,236.26 0.00 8,636.261.515101 992,600.00912828WL07,400.000.001132 0.00 2.200CNBF332.71 0.00 332.712.200101 240,000.0017801DDT00.00240,000.001134 240,000.00 3.050UOFICU621.70 0.00 621.703.050101 240,000.0091435LAG20.000.001136 0.00 2.200UNION216.99 0.00 216.992.200101 240,000.0090521AQW10.00488,250.001138 500,000.00 1.125USTR473.84 0.00 473.841.143101 488,250.00912828VA50.00496,700.001139 500,000.00 1.750FNMA729.17 0.00 729.171.728101 496,700.003135G0ZG10.00492,000.001140 500,000.00 0.875FNMA364.58 0.00 364.580.872101 492,000.003135G0N330.00494,750.001141 500,000.00 1.210FFCB504.16 0.00 504.161.200101 494,750.003133EGFU40.00491,750.001142 500,000.00 1.550FFCB645.83 0.00 645.831.546101 491,750.003133EHJA20.00245,000.001143 245,000.00 3.100ALLGNC645.05 0.00 645.053.100101 245,000.0001748DBE50.00245,000.001144 245,000.00 3.150RCB655.46 0.00 655.463.150101 245,000.0074934YAH40.00245,000.001145 245,000.00 2.750WEX572.22 0.00 572.222.750101 245,000.0092937CHG60.00245,000.001146 245,000.00 2.850EAGLE593.03 0.00 593.032.850101 245,000.0027002YDV50.00245,000.001147 245,000.00 3.1501STNBA655.46 0.00 655.463.150101 245,000.0032110YLK90.00245,000.001148 245,000.00 3.000TRAD624.24 0.00 624.243.000101 245,000.0089269CBX90.00245,000.001149 245,000.00 3.000PCSB624.24 0.00 624.243.000101 245,000.0069324MAD70.00240,000.001150 240,000.00 3.100GECRUN631.89 0.00 631.893.100101 240,000.00369674AV80.00249,000.001151 249,000.00 3.250NWENGL687.30 0.00 687.303.250101 249,000.0006426KAN80.0016,492,314.731153 16,492,314.73CAMP25,529.10 0.00 25,529.102.515101 11,466,785.63SYS11530.00245,000.001154 245,000.00 3.350JEFF697.08 0.00 697.083.350101 245,000.00474067AQ80.00248,000.001155 248,000.00 3.300MARBUS695.08 0.00 695.083.300101 248,000.0057116ARV20.00398,800.001156 400,000.00 3.000FHLMC1,000.00 0.00 1,000.002.952101 398,800.003134GSWS00.00378,360.001157 400,000.00 2.000MCRSFT666.67 0.00 666.672.075101 378,360.00594918BQ60.00247,275.001158 250,000.00 2.800FFCB583.33 0.00 583.332.778101 247,275.003133EJYL70.00487,950.001159 500,000.00 2.300P&G958.33 0.00 958.332.312101 487,950.00742718DY20.00245,000.001160 245,000.00 3.200MUNTRS665.87 0.00 665.873.200101 245,000.00625925AR30.00245,000.001161 245,000.00 3.350UBS697.07 0.00 697.073.350101 245,000.0090348JEJ50.00248,000.001162 248,000.00 3.400COMMBK716.14 0.00 716.143.400101 248,000.0020143PDV90.00248,000.001163 248,000.00 3.250MRRCK684.55 0.00 684.553.250101 248,000.0059013J4K20.00Portfolio CITYCPRun Date: 10/09/2019 - 11:35TE (PRF_TE) 7.3.6Report Ver. 7.3.6.1 CurrentRateEndingPar ValueEndingFundPage 4Book ValueBeginningBook ValueAdjusted Interest EarningsAccretionAmortization/EarningsAdjusted InterestMay 1, 2019 - May 31, 2019Total EarningsCity of La QuintaAnnualizedYieldCUSIP Investment #InterestEarnedIssuerRealizedGainl/LossFund: General Fund248,000.001164 248,000.00 3.550NMRCA747.74 0.00 747.743.550101 248,000.0067054NAN30.00248,000.001165 248,000.00 3.000FARMBU631.89 0.00 631.893.000101 248,000.00307660LC20.00248,000.001166 248,000.00 3.350REDRCK705.61 0.00 705.613.350101 248,000.0075701LAB30.00245,000.001167 245,000.00 3.200NEIGH665.86 0.00 665.863.200101 245,000.0064017AAQ70.00245,000.001168 245,000.00 3.1501STSRC655.46 0.00 655.463.150101 245,000.0033646CKP80.00248,000.001169 248,000.00 3.400MEDBA716.14 0.00 716.143.400101 248,000.0058404DCX70.00245,000.001170 245,000.00 3.400NLCOOP707.48 0.00 707.483.400101 245,000.00635573AL20.00248,000.001171 248,000.00 3.300MAINE695.08 0.00 695.083.300101 248,000.00560507AK10.00248,000.001172 248,000.00 3.350BARHAR705.61 0.00 705.613.350101 248,000.00066851WJ10.00248,000.001173 248,000.00 2.750MORTN579.24 0.00 579.242.750101 248,000.00619165JD60.00248,000.001174 248,000.00 3.000WELLS631.89 0.00 631.893.000101 248,000.00949763XY70.00485,250.001175 500,000.00 1.950COLGTE812.50 0.00 812.501.971101 485,250.0019416QEA40.00245,000.001176 245,000.00 2.500ALLY520.20 0.00 520.202.500101 245,000.0002007GHX40.00498,550.001177 500,000.00 2.500FHLB1,041.67 0.00 1,041.672.460101 498,550.003130AFW940.00489,687.501178 500,000.00 1.875USTR794.05 0.00 794.051.909101 489,687.509128282W90.00248,000.001179 248,000.00 2.8001STNBK589.77 0.00 589.772.800101 248,000.0032117BCX40.00248,000.001180 248,000.00 2.700VERUS568.70 0.00 568.702.700101 248,000.0092535LCD40.00248,000.001181 248,000.00 2.950NRTHWS621.36 0.00 621.362.950101 248,000.0066736ABP30.000.001183 0.00STIFEL48.99 0.00 48.99-0.147101 -248,000.00SYS11830.00248,000.001184 248,000.00 2.500CENTNX33.97 0.00 33.972.500101 0.00156634AK30.00245,000.001185 245,000.00 3.250JPMORG327.23 0.00 327.233.250101 0.0048128HXU70.00245,000.001186 245,000.00 2.400IOWAST144.99 0.00 144.992.400101 0.0046256YAZ20.00248,000.001187 248,000.00 2.400TSCOLA146.76 0.00 146.762.400101 0.0087266AAA10.00248,000.001188 248,000.00 2.600MAINST547.64 0.00 547.642.600101 248,000.0056065GAG30.00248,000.001189 248,000.00 2.500CONGRS526.58 0.00 526.582.500101 248,000.0020726ABA50.00496,650.001190 500,000.00 2.350WALMRT979.17 0.00 979.172.321101 496,650.00931142DU40.00492,100.001191 500,000.00 1.700FFCB70.83 0.00 70.831.313101 0.003133EGD280.00496,650.001192 500,000.00 1.750USTR23.78 0.00 23.781.748101 0.00912828SV30.00493,610.001193 500,000.00 1.375USTR18.78 0.00 18.781.389101 0.00912828R770.00131,488,976.32Subtotal 131,218,383.822.162235,382.000.00226,982.00128,067,658.798,400.00Fund: 1st Empire Securities Cash Bal0.001060 0.00EMPIRE0.00 0.00 0.00102 0.00SYS10600.000.00Subtotal 0.000.000.000.000.000.00Portfolio CITYCPRun Date: 10/09/2019 - 11:35TE (PRF_TE) 7.3.6Report Ver. 7.3.6.1 CurrentRateEndingPar ValueEndingFundPage 5Book ValueBeginningBook ValueAdjusted Interest EarningsAccretionAmortization/EarningsAdjusted InterestMay 1, 2019 - May 31, 2019Total EarningsCity of La QuintaAnnualizedYieldCUSIP Investment #InterestEarnedIssuerRealizedGainl/LossFund: Fiscal Agent1,671.271058 1,671.27USBANK2.44 0.00 2.441.721231 1,668.83SYS10580.001,671.27Subtotal 1,671.271.7212.440.002.441,668.830.00Fund: Housing Authority : WSA and LQ248,920.451062 248,920.45LQPR0.00 0.00 0.00241 249,851.30SYS10620.00248,920.45Subtotal 248,920.450.000.000.00249,851.300.00Fund: SA Low/Mod Bond Fund16,363,851.431113 16,363,851.43 2.449LAIF33,982.57 0.00 33,982.572.445249 16,363,851.4325-33-0050.0016,363,851.43Subtotal 16,363,851.432.44533,982.570.0033,982.5716,363,851.430.00148,103,419.47Total 147,832,826.97 2.191269,367.010.00260,967.01144,683,030.358,400.00Portfolio CITYCPRun Date: 10/09/2019 - 11:35TE (PRF_TE) 7.3.6Report Ver. 7.3.6.1 Days to Maturity Page 1 Par Value Book Value Maturity Date Stated RateMarket Value June 30, 2019 Portfolio Details - Investments Average BalanceIssuer Portfolio Management City of La Quinta YTM 365TermCUSIPInvestment # Purchase Date Bank Accounts 1City Petty Cash1059 3,300.00 3,300.0007/01/2016 3,300.00 1SYS1059 0.000 1First Empire Bank1060 0.00 0.0007/01/2016 0.00 1SYS1060 0.000 1La Quinta Palms Realty1062 242,947.26 242,947.2607/01/2016 242,947.26 1SYS1062 0.000 1Stifel, Nicolaus & Company1183 100,115.92 100,115.9203/18/2019 100,115.92 1SYS1183 0.000 1Wells Fargo1057 4,240,622.94 4,240,622.9407/01/2016 4,240,622.94 14159282482 0.000 4,586,986.12 14,586,986.124,586,986.123,506,341.54Subtotal and Average 1 0.000 Local Agency Invstmnt Fund-Housing 1Local Agency Inv Fund1113 16,363,851.43 16,363,851.43 2.42816,319,382.05 125-33-005 2.428 16,363,851.43 116,319,382.0516,363,851.4316,363,851.43Subtotal and Average 1 2.428 Local Agency Investment Fund-City 1Local Agency Inv Fund1055 57,505,436.60 57,505,436.60 2.42857,412,935.65 198-33-434 2.428 57,505,436.60 157,412,935.6557,505,436.6057,172,103.27Subtotal and Average 1 2.428 Federal Agency Coupon Securities 11Federal Farm Credit Bank1092 1,000,000.00 992,600.00 07/12/20191.08007/10/2017 999,630.00 7323133EGLC7 1.456 793Federal Farm Credit Bank1105 1,000,000.00 992,200.00 09/01/20211.70011/09/2017 997,950.00 1,3923133EHWM1 1.913 312Federal Farm Credit Bank1142 500,000.00 491,750.00 05/08/20201.55005/31/2018 498,175.00 7083133EHJA2 2.427 1,527Federal Farm Credit Bank1158 250,000.00 247,275.00 09/05/20232.80010/15/2018 258,690.00 1,7863133EJYL7 3.041 1,219Federal Farm Credit Bank1191 500,000.00 492,100.00 11/01/20221.70005/28/2019 496,305.00 1,2533133EGD28 2.181 1,260Federal Farm Credit Bank1198 500,000.00 499,500.00 12/12/20221.87506/20/2019 500,855.00 1,2713133EKQP4 1.905 667Federal Home Loan Bank1053 2,500,000.00 2,491,250.00 04/28/20211.35004/28/2016 2,479,300.00 1,8263130A7QZ1 1.423 483Federal Home Loan Bank1064 2,500,000.00 2,500,000.00 10/26/20201.37510/26/2016 2,482,775.00 1,4613130A9UQ2 1.375 438Federal Home Loan Bank1104 1,000,000.00 996,800.00 09/11/20201.62511/09/2017 995,940.00 1,0373130A66T9 1.741 1,688Federal Home Loan Bank1177 500,000.00 498,550.00 02/13/20242.50003/01/2019 515,405.00 1,8103130AFW94 2.563 667Federal Home Loan Mtg Corp1054 2,500,000.00 2,500,000.00 04/28/20211.50004/28/2016 2,498,125.00 1,8263134G8Y37 1.400 1,002Federal Home Loan Mtg Corp1073 2,000,000.00 1,990,000.00 03/29/20222.00003/29/2017 2,000,840.00 1,8263134GBAE2 2.106 912Federal Home Loan Mtg Corp1084 1,000,000.00 999,500.00 12/29/20212.00007/06/2017 1,000,330.00 1,6373134GBXF4 2.012 1,122Federal Home Loan Mtg Corp1090 1,000,000.00 1,000,000.00 07/27/20222.15007/27/2017 1,000,200.00 1,8263134GBWG3 2.150 1,309Federal Home Loan Mtg Corp1116 1,000,000.00 1,000,000.00 01/30/20232.55001/30/2018 1,000,280.00 1,8263134GSCD5 2.550 1,333Federal Home Loan Mtg Corp1122 750,000.00 746,625.00 02/23/20232.75004/02/2018 750,862.50 1,7883134GSCQ6 2.849 1,184Federal Home Loan Mtg Corp1156 400,000.00 398,800.00 09/27/20223.00010/15/2018 400,888.00 1,4433134GSWS0 3.081 210Federal National Mtg Assn1072 2,000,000.00 2,000,000.00 01/27/20201.70003/27/2017 1,994,880.00 1,0363135G0S53 1.700 73Federal National Mtg Assn1139 500,000.00 496,700.00 09/12/20191.75005/31/2018 499,485.00 4693135G0ZG1 2.275 32Federal National Mtg Assn1140 500,000.00 492,000.00 08/02/20190.87505/31/2018 499,395.00 4283135G0N33 2.269 Portfolio CITY CP Run Date: 08/28/2019 - 14:05 PM (PRF_PM2) 7.3.0 Report Ver. 7.3.6.1 Days to Maturity Page 2 Par Value Book Value Maturity Date Stated RateMarket Value June 30, 2019 Portfolio Details - Investments Average BalanceIssuer Portfolio Management City of La Quinta YTM 365TermCUSIPInvestment # Purchase Date 21,825,650.00 1,47521,870,310.5021,900,000.0021,822,641.67Subtotal and Average 717 1.865 Treasury Coupon Securities 730U.S. Treasury1045 5,000,000.00 5,000,000.00 06/30/20211.12507/18/2016 4,938,650.00 1,808912828S27 1.125 274U.S. Treasury1068 2,500,000.00 2,483,250.00 03/31/20201.37503/20/2017 2,487,800.00 1,107912828J84 1.602 167U.S. Treasury1069 2,500,000.00 2,490,750.00 12/15/20191.37503/20/2017 2,492,100.00 1,000912828U73 1.513 853U.S. Treasury1070 2,000,000.00 1,942,800.00 10/31/20211.25003/27/2017 1,977,740.00 1,679912828T67 1.903 411U.S. Treasury1117 1,000,000.00 985,800.00 08/15/20201.50001/22/2018 995,390.00 9369128282Q2 2.071 304U.S. Treasury1138 500,000.00 488,250.00 04/30/20201.12505/31/2018 496,330.00 700912828VA5 2.387 1,187U.S. Treasury1178 500,000.00 489,687.50 09/30/20221.87503/01/2019 502,460.00 1,3099128282W9 2.480 1,049U.S. Treasury1192 500,000.00 496,650.00 05/15/20221.75005/31/2019 500,370.00 1,080912828SV3 1.984 700U.S. Treasury1193 500,000.00 493,610.00 05/31/20211.37505/31/2019 496,250.00 731912828R77 2.030 14,870,797.50 1,36814,887,090.0015,000,000.0014,870,797.50Subtotal and Average 565 1.579 Certificate of Deposits 143First Farmers Bank &Trust Co.1091 240,000.00 240,000.00 11/21/20191.65007/21/2017 239,527.20 853320165HX4 1.653 1,480First National Bank of America1147 245,000.00 245,000.00 07/20/20233.15007/20/2018 250,603.15 1,82632110YLK9 3.152 1,404First National Bank1179 248,000.00 248,000.00 05/05/20232.80003/05/2019 250,663.52 1,52232117BCX4 2.802 870First Source Bank1168 245,000.00 245,000.00 11/17/20213.15012/17/2018 250,269.95 1,06633646CKP8 3.153 476First Tech Federal Credit Unio1124 245,000.00 245,000.00 10/19/20202.70004/18/2018 246,629.25 91533715LBJ8 2.623 945Third Federal Savings and Loan1112 245,000.00 245,000.00 01/31/20222.50001/30/2018 246,604.75 1,46288413QBY3 2.502 1,078Allegiance Bank1143 245,000.00 245,000.00 06/13/20223.10006/13/2018 250,875.10 1,46101748DBE5 3.102 1,200Alliance Credit Union1095 245,000.00 245,000.00 10/13/20222.25010/13/2017 244,250.30 1,82601859BAA3 2.251 616Ally Bank Midvale1176 245,000.00 245,000.00 03/08/20212.50003/07/2019 246,239.70 73202007GHX4 2.016 1,093America's Credit Union1200 248,000.00 248,000.00 06/28/20222.30006/28/2019 248,000.00 1,09603065AAL7 2.302 658Amex Centurion1077 240,000.00 240,000.00 04/19/20212.25004/19/2017 239,704.80 1,46102587DP85 2.252 1,155American Express Fed Savings B1096 240,000.00 240,000.00 08/29/20222.40008/29/2017 239,426.40 1,82602587CFU9 2.402 1,360Aneca Federal Credit Union1119 245,000.00 245,000.00 03/22/20232.80003/22/2018 247,842.00 1,826034577AH9 2.802 1,212Barclays Bank1097 240,000.00 240,000.00 10/25/20222.30010/25/2017 239,568.00 1,82606740KLJ4 2.291 1,642Bar Harbor Bank and Trust1172 248,000.00 248,000.00 12/29/20233.35012/31/2018 255,836.80 1,824066851WJ1 3.352 875Belmont Savings Bank1102 245,000.00 245,000.00 11/22/20212.10011/21/2017 244,274.80 1,462080515CD9 2.101 969BMW Bank1067 240,000.00 240,000.00 02/24/20222.20002/24/2017 239,738.40 1,82605580AGK4 2.201 563Bankers Bank1086 240,000.00 240,000.00 01/14/20211.80007/14/2017 238,579.20 1,28006610RAP4 1.804 707Capital One Natl Assn FDIC42971082 240,000.00 240,000.00 06/07/20212.25006/07/2017 240,220.80 1,46114042RGD7 2.252 345Capital One USA FDIC339541006 245,000.00 245,000.00 06/10/20201.90006/10/2015 244,475.70 1,827140420RX0 1.902 602Comenity Capital Bank1009 240,000.00 240,000.00 02/22/20211.70002/22/2016 238,082.40 1,82720033APG5 1.702 1,781Century Next Bank1184 248,000.00 248,000.00 05/16/20242.50005/29/2019 246,273.92 1,814156634AK3 2.503 Portfolio CITY CP Run Date: 08/28/2019 - 14:05 PM (PRF_PM2) 7.3.0 Days to Maturity Page 3 Par Value Book Value Maturity Date Stated RateMarket Value June 30, 2019 Portfolio Details - Investments Average BalanceIssuer Portfolio Management City of La Quinta YTM 365TermCUSIPInvestment # Purchase Date Certificate of Deposits 1,380Citibank NA1123 245,000.00 245,000.00 04/11/20232.90004/11/2018 248,621.10 1,82617312QJ26 2.902 744Central State Bank1085 240,000.00 240,000.00 07/14/20211.85007/14/2017 238,296.00 1,46115523RBJ4 1.851 1,598Commercial Bank1162 248,000.00 248,000.00 11/15/20233.40011/15/2018 256,288.16 1,82620143PDV9 3.402 1,824Communitywide FCU1202 248,000.00 248,000.00 06/28/20242.25006/28/2019 243,268.16 1,82720416TAQ5 2.253 1,397Congressional Bank1189 248,000.00 248,000.00 04/28/20232.50004/30/2019 247,982.64 1,45920726ABA5 2.502 1,236CrossFirst Bank1106 245,000.00 245,000.00 11/18/20222.20011/20/2017 243,605.95 1,82422766ACB9 2.201 1,817Citizens State Bank1199 248,000.00 248,000.00 06/21/20242.40006/21/2019 245,019.04 1,827176688CP2 2.403 946Discover Bank Greenwood DE CF1066 240,000.00 240,000.00 02/01/20222.25002/01/2017 240,069.60 1,8262546722U1 2.251 204Douglas National Bank1093 240,000.00 240,000.00 01/21/20201.65007/19/2017 239,352.00 916259744DS6 1.655 569Eagle Bank1146 245,000.00 245,000.00 01/20/20212.85007/20/2018 247,476.95 91527002YDV5 2.858 1,397EnerBank USA1125 240,000.00 240,000.00 04/28/20232.95004/30/2018 243,926.40 1,82429278TAY6 2.952 1,246Enterprise Bank, NA1107 245,000.00 245,000.00 11/28/20222.15011/28/2017 243,130.65 1,82629367QCP1 2.151 1,808Evansville Teachers Credit FCU1196 248,000.00 248,000.00 06/12/20242.60006/12/2019 247,365.12 1,827299547AQ2 2.603 340EverBank1017248,000.00 248,000.00 06/05/20201.70006/05/2015 246,898.88 1,82729976DXX3 1.702 567Farm Bureau Bank1165 248,000.00 248,000.00 01/18/20213.00012/17/2018 251,067.76 763307660LC2 2.898 1,033Farmers Insurance Group FCU1126 240,000.00 240,000.00 04/29/20222.80004/30/2018 243,607.20 1,46030960QAG2 2.802 540Freedom Credit Union1111 245,000.00 245,000.00 12/22/20202.05012/22/2017 244,505.10 1,09635638BAA9 2.052 777General Electric Credit Union1150 240,000.00 240,000.00 08/16/20213.10008/15/2018 244,442.40 1,097369674AV8 3.100 1,030Goldman Sachs1078 240,000.00 240,000.00 04/26/20222.40004/26/2017 240,967.20 1,82638148PJK4 2.401 378First Bank of Highland1094 240,000.00 240,000.00 07/13/20201.75007/13/2017 238,951.20 1,096319141GT8 1.752 1,109HSBC Bank USA, National Associ1088 240,000.00 240,000.00 07/14/20222.30007/14/2017 239,983.20 1,82640434YLE5 2.301 1,788Iowa State Bank1186 245,000.00 245,000.00 05/23/20242.40005/23/2019 242,202.10 1,82746256YAZ2 2.403 1,571Jefferson Financial CU1154 245,000.00 245,000.00 10/19/20233.35010/19/2018 252,607.25 1,826474067AQ8 3.352 316Jefferson Bank & Trust1100 245,000.00 245,000.00 05/12/20201.75011/09/2017 244,091.05 915472376AC6 1.751 1,781JP Morgan Chase1185 245,000.00 245,000.00 05/16/20243.25005/16/2019 243,799.50 1,82748128HXU7 3.254 1,051Kansas State Bank1101 245,000.00 245,000.00 05/17/20222.10011/17/2017 243,939.15 1,64250116CBE8 2.099 1,277Knoxville TVA Credit Union1110 245,000.00 245,000.00 12/29/20222.40012/29/2017 244,941.20 1,826499724AB8 2.401 1,815Legacy Bank1197 248,000.00 248,000.00 06/19/20242.40006/19/2019 245,028.96 1,827524661CB9 2.403 973Maine Savings FCU1171 248,000.00 248,000.00 02/28/20223.30012/28/2018 254,782.80 1,158560507AK1 3.306 1,761Main Street Bank1188 248,000.00 248,000.00 04/26/20242.60004/26/2019 247,538.72 1,82756065GAG3 2.603 1,569Marlin Business Bank1155 248,000.00 248,000.00 10/17/20233.30010/17/2018 255,229.20 1,82657116ARV2 3.302 1,255Medallion Bank1169 248,000.00 248,000.00 12/07/20223.40012/07/2018 256,268.32 1,46158404DCX7 3.402 372Mercantile Bank of Michigan1087 240,000.00 240,000.00 07/07/20201.75007/07/2017 238,970.40 1,09658740XZL7 1.752 347Bank Midwest1002 248,000.00 248,000.00 06/12/20201.65006/12/2015 246,767.44 1,827063615AVO 1.652 140Morgan Stanley Bank1109 245,000.00 245,000.00 11/18/20191.80011/16/2017 244,659.45 73261747MA92 1.800 1,450Morton Community1173 248,000.00 248,000.00 06/20/20232.75003/20/2019 249,934.40 1,553619165JD6 2.753 Portfolio CITY CP Run Date: 08/28/2019 - 14:05 PM (PRF_PM2) 7.3.0 Days to Maturity Page 4 Par Value Book Value Maturity Date Stated RateMarket Value June 30, 2019 Portfolio Details - Investments Average BalanceIssuer Portfolio Management City of La Quinta YTM 365TermCUSIPInvestment # Purchase Date Certificate of Deposits 1,215Merrick Bank1163 248,000.00 248,000.00 10/28/20223.25010/30/2018 255,082.88 1,45959013J4K2 3.252 140Morgan Stanley Private Bk, NA1108 245,000.00 245,000.00 11/18/20191.75011/16/2017 244,610.45 73261760AEP0 1.750 1,226Mountain America Federal CU1099 245,000.00 245,000.00 11/08/20222.30011/08/2017 244,470.80 1,82662384RAC0 2.301 1,569Municipal Trust and Savings1160 245,000.00 245,000.00 10/17/20233.20010/17/2018 251,144.60 1,826625925AR3 3.202 904Neighbors FCU1167 245,000.00 245,000.00 12/21/20213.20012/21/2018 250,713.40 1,09664017AAQ7 3.203 1,634National Cooperative Bank, N.A1170 245,000.00 245,000.00 12/21/20233.40012/21/2018 253,219.75 1,826635573AL2 3.402 1,611Numerica Credit Union1164 248,000.00 248,000.00 11/28/20233.55011/28/2018 257,860.48 1,82667054NAN3 3.552 848Northpointe Bank1127 240,000.00 240,000.00 10/26/20212.70004/26/2018 242,599.20 1,279666613GV0 2.703 1,688Northwest Bank1181 248,000.00 248,000.00 02/13/20242.95002/13/2019 251,568.72 1,82666736ABP3 2.951 1,491Bank of New England1151 249,000.00 249,000.00 07/31/20233.25007/31/2018 255,663.24 1,82606426KAN8 3.252 933The Ohio Valley Bank1089 240,000.00 240,000.00 01/19/20221.90007/19/2017 237,996.00 1,645677721CN0 1.903 1,073PCSB Bank1149 245,000.00 245,000.00 06/08/20223.00006/08/2018 250,169.50 1,46169324MAD7 3.002 1,437Pittsfield Cooperative Bank1194 245,000.00 245,000.00 06/07/20232.50006/07/2019 244,691.30 1,461725404AB3 2.502 1,803Plains Commerce Bank1195 245,000.00 245,000.00 06/07/20242.55006/07/2019 243,826.45 1,82772651LCL6 2.553 695PrivateBank & Trust1032 240,000.00 240,000.00 05/26/20211.50005/26/2016 237,302.40 1,82674267GVG9 1.501 1,450RCB Bank1144 245,000.00 245,000.00 06/20/20233.15006/20/2018 250,612.95 1,82674934YAH4 3.152 1,255Red Rocks Credit Union1166 248,000.00 248,000.00 12/07/20223.35012/07/2018 255,859.12 1,46175701LAB3 3.352 1,824Revere Bank1203 247,000.00 247,000.00 06/28/20242.30006/28/2019 242,855.34 1,827761402BY1 2.303 511First Bank Richmond1081 245,000.00 245,000.00 11/23/20201.80006/21/2017 243,684.35 1,251319267GC8 1.802 66Riverwood1034248,000.00 248,000.00 09/05/20191.40006/05/2015 247,744.56 1,55376951DAL4 1.402 1,086Sallie Mae Bank Salt Lake CIty1083 240,000.00 240,000.00 06/21/20222.35006/21/2017 240,614.40 1,826795450A70 2.351 1,155Sterling Bank1201 245,000.00 245,000.00 08/29/20222.15006/28/2019 243,801.95 1,15885916VDC6 2.153 295Stearnes Bank, N.A.1076 240,000.00 240,000.00 04/21/20201.60004/21/2017 238,879.20 1,096857894TC3 1.588 1,067Synchrony Bank Retail1080 240,000.00 240,000.00 06/02/20222.40006/02/2017 240,962.40 1,82687164XQV1 2.401 669Towne Bank1128 240,000.00 240,000.00 04/30/20212.80004/30/2018 242,592.00 1,09689214PBL2 2.803 1,134Traditions Bank1148 245,000.00 245,000.00 08/08/20223.00006/08/2018 250,186.65 1,52289269CBX9 3.002 875TNB Bank1187 248,000.00 248,000.00 11/22/20212.40005/22/2019 249,004.40 91587266AAA1 2.407 1,569UBS Bank USA1161 245,000.00 245,000.00 10/17/20233.35010/17/2018 252,639.10 1,82690348JEJ5 3.352 624Unity Bank1120 245,000.00 245,000.00 03/16/20212.55003/16/2018 246,465.10 1,09691330ABN6 2.552 1,414University of Iowa Comm. CU1134 240,000.00 240,000.00 05/15/20233.05005/14/2018 244,740.00 1,82791435LAG2 3.052 1,338Verus Bank of Commerce1180 248,000.00 248,000.00 02/28/20232.70002/28/2019 250,125.36 1,46192535LCD4 2.700 1,702Wells Fargo1174 248,000.00 248,000.00 02/27/20243.00002/27/2019 251,186.80 1,826949763XY7 3.001 350Wex Bank1145 245,000.00 245,000.00 06/15/20202.75006/13/2018 246,345.05 73392937CHG6 2.754 22,249,000.00 1,51922,392,488.6922,249,000.0020,873,266.67Subtotal and Average 1,071 2.525 Portfolio CITY CP Run Date: 08/28/2019 - 14:05 PM (PRF_PM2) 7.3.0 Days to Maturity Page 5 Par Value Book Value Maturity Date Stated RateMarket Value June 30, 2019 Portfolio Details - Investments Average BalanceIssuer Portfolio Management City of La Quinta YTM 365TermCUSIPInvestment # Purchase Date Corporate Notes 765Apple Inc1079 500,000.00 493,050.00 08/04/20211.55006/12/2017 495,160.00 1,514037833CC2 1.900 1,311Colgate-Palmolive1175 500,000.00 485,250.00 02/01/20231.95003/04/2019 500,810.00 1,43019416QEA4 2.751 220Microsoft Corporation1118 500,000.00 497,700.00 02/06/20201.85001/22/2018 498,930.00 745594918BV5 2.081 1,499Microsoft Corporation1157 400,000.00 378,360.00 08/08/20232.00010/15/2018 399,288.00 1,758594918BQ6 3.222 951Proctor and Gamble1159 500,000.00 487,950.00 02/06/20222.30010/15/2018 503,955.00 1,210742718DY2 3.071 109Toyota Motor Credit Corp1098 500,000.00 498,750.00 10/18/20191.55011/07/2017 498,955.00 71089236TDH5 1.681 647Toyota Motor Credit Corp1204 500,000.00 499,750.00 04/08/20211.90006/24/2019 497,805.00 65489236TCZ6 1.928 1,263Wal-Mart Stores, Inc1190 500,000.00 496,650.00 12/15/20222.35004/16/2019 505,610.00 1,339931142DU4 2.799 3,837,460.00 1,1503,900,513.003,900,000.003,454,318.33Subtotal and Average 823 2.402 Money Market Accounts 1California Asset Management Pr1153 20,531,379.20 20,531,379.2009/26/2018 20,531,379.20 1SYS1153 0.000 20,531,379.20 120,531,379.2020,531,379.2019,160,283.55Subtotal and Average 1 0.000 Money Market with Fiscal Agent 1US Bank1058 1,673.76 1,673.7607/01/2016 1,673.76 1SYS1058 0.000 1,673.76 11,673.761,673.761,671.35Subtotal and Average 1 0.000 Managed Pool Accounts-OPEB Trust 1CalPERS CERBT Plan1114 1,627,510.76 1,627,510.7607/01/2018 1,627,510.76 1SYS1114 0.000 1,627,510.76 11,627,510.761,627,510.761,576,595.21Subtotal and Average 1 0.000 556158,801,870.51 163,665,837.87 313 1.891163,530,269.73 163,399,745.37Total and Average Portfolio CITY CP Run Date: 08/28/2019 - 14:05 PM (PRF_PM2) 7.3.0 City of La QuintaTotal EarningsCity of La Quinta -Sorted by Fund - FundJune 1, 2019 - June 30, 2019CurrentRateEndingPar ValueEndingFundBook ValueBeginningBook ValueAdjusted Interest EarningsAccretionAmortization/EarningsAdjusted InterestAnnualizedYieldCUSIP Investment #InterestEarnedIssuerRealizedGainl/LossFund: General Fund248,000.001002 248,000.00 1.650MIDWES336.33 0.00 336.331.650101 248,000.00063615AVO0.00245,000.001006 245,000.00 1.900CAPONE382.61 0.00 382.611.900101 245,000.00140420RX00.00240,000.001009 240,000.00 1.700CCBA335.34 0.00 335.341.700101 240,000.0020033APG50.000.001011 0.00 1.500CONNEC40.77 0.00 40.771.500101 248,000.0020786ABD60.00248,000.001017 248,000.00 1.700EVRBA346.52 0.00 346.521.700101 248,000.0029976DXX30.00240,000.001032 240,000.00 1.500PRVTBA295.89 0.00 295.891.500101 240,000.0074267GVG90.00248,000.001034 248,000.00 1.400RVRW285.37 0.00 285.371.400101 248,000.0076951DAL40.000.001035 0.00 1.400SOLOM28.53 0.00 28.531.400101 248,000.0083427LAX20.005,000,000.001045 5,000,000.00 1.125USTR4,659.07 0.00 4,659.071.134101 5,000,000.00912828S270.002,491,250.001053 2,500,000.00 1.350FHLB2,812.50 0.00 2,812.501.374101 2,491,250.003130A7QZ10.002,500,000.001054 2,500,000.00 1.500FHLMC3,125.00 0.00 3,125.001.521101 2,500,000.003134G8Y370.0057,505,436.601055 57,505,436.60 2.428LAIF120,555.61 0.00 120,555.612.566101 49,505,436.6098-33-4340.004,240,622.941057 4,240,622.94WELLS0.01 0.00 0.01101 3,090,085.4941592824820.003,300.001059 3,300.00CITYPC0.00 0.00 0.00101 3,300.00SYS10590.002,500,000.001064 2,500,000.00 1.375FHLB2,864.59 0.00 2,864.591.394101 2,500,000.003130A9UQ20.00240,000.001066 240,000.00 2.250DISCOV443.84 0.00 443.842.250101 240,000.002546722U10.00240,000.001067 240,000.00 2.200BMW433.97 0.00 433.972.200101 240,000.0005580AGK40.002,483,250.001068 2,500,000.00 1.375USTR2,817.62 0.00 2,817.621.380101 2,483,250.00912828J840.002,490,750.001069 2,500,000.00 1.375USTR2,824.85 0.00 2,824.851.380101 2,490,750.00912828U730.001,942,800.001070 2,000,000.00 1.250USTR2,038.05 0.00 2,038.051.276101 1,942,800.00912828T670.002,000,000.001072 2,000,000.00 1.700FNMA2,833.33 0.00 2,833.331.724101 2,000,000.003135G0S530.001,990,000.001073 2,000,000.00 2.000FHLMC3,333.33 0.00 3,333.332.038101 1,990,000.003134GBAE20.00240,000.001076 240,000.00 1.600STRNS315.62 0.00 315.621.600101 240,000.00857894TC30.00240,000.001077 240,000.00 2.250AMEX443.84 0.00 443.842.250101 240,000.0002587DP850.00240,000.001078 240,000.00 2.400GLDMAN473.42 0.00 473.422.400101 240,000.0038148PJK40.00493,050.001079 500,000.00 1.550APPL645.83 0.00 645.831.594101 493,050.00037833CC20.00240,000.001080 240,000.00 2.400SYNCHR473.42 0.00 473.422.400101 240,000.0087164XQV10.00245,000.001081 245,000.00 1.800RICHMN362.46 0.00 362.461.800101 245,000.00319267GC80.00240,000.001082 240,000.00 2.250CAP1NA443.84 0.00 443.842.250101 240,000.0014042RGD70.00240,000.001083 240,000.00 2.350SALMAE463.56 0.00 463.562.350101 240,000.00795450A700.00Portfolio CITYCPRun Date: 10/09/2019 - 11:41TE (PRF_TE) 7.3.6Report Ver. 7.3.6.1 CurrentRateEndingPar ValueEndingFundPage 2Book ValueBeginningBook ValueAdjusted Interest EarningsAccretionAmortization/EarningsAdjusted InterestJune 1, 2019 - June 30, 2019Total EarningsCity of La QuintaAnnualizedYieldCUSIP Investment #InterestEarnedIssuerRealizedGainl/LossFund: General Fund999,500.001084 1,000,000.00 2.000FHLMC1,666.67 0.00 1,666.672.029101 999,500.003134GBXF40.00240,000.001085 240,000.00 1.850CNTRL364.93 0.00 364.931.850101 240,000.0015523RBJ40.00240,000.001086 240,000.00 1.800BNKRS355.07 0.00 355.071.800101 240,000.0006610RAP40.00240,000.001087 240,000.00 1.750MERCTL345.21 0.00 345.211.750101 240,000.0058740XZL70.00240,000.001088 240,000.00 2.300HSBC453.70 0.00 453.702.300101 240,000.0040434YLE50.00240,000.001089 240,000.00 1.900OHVAL374.79 0.00 374.791.900101 240,000.00677721CN00.001,000,000.001090 1,000,000.00 2.150FHLMC1,791.66 0.00 1,791.662.180101 1,000,000.003134GBWG30.00240,000.001091 240,000.00 1.6501STFRM325.48 0.00 325.481.650101 240,000.00320165HX40.00992,600.001092 1,000,000.00 1.080FFCB900.00 0.00 900.001.103101 992,600.003133EGLC70.00240,000.001093 240,000.00 1.650DOUGLS325.48 0.00 325.481.650101 240,000.00259744DS60.00240,000.001094 240,000.00 1.750HIGHLD345.21 0.00 345.211.750101 240,000.00319141GT80.00245,000.001095 245,000.00 2.250ALLIAN453.09 0.00 453.092.250101 245,000.0001859BAA30.00240,000.001096 240,000.00 2.400AMFSB473.42 0.00 473.422.400101 240,000.0002587CFU90.00240,000.001097 240,000.00 2.300BARCLY453.70 0.00 453.702.300101 240,000.0006740KLJ40.00498,750.001098 500,000.00 1.550TOYOTA645.84 0.00 645.841.575101 498,750.0089236TDH50.00245,000.001099 245,000.00 2.300MTNAMR463.16 0.00 463.162.300101 245,000.0062384RAC00.00245,000.001100 245,000.00 1.750JFFRSN352.40 0.00 352.401.750101 245,000.00472376AC60.00245,000.001101 245,000.00 2.100KANSAS422.88 0.00 422.882.100101 245,000.0050116CBE80.00245,000.001102 245,000.00 2.100BELMNT422.87 0.00 422.872.100101 245,000.00080515CD90.00996,800.001104 1,000,000.00 1.625FHLB1,354.17 0.00 1,354.171.653101 996,800.003130A66T90.00992,200.001105 1,000,000.00 1.700FFCB1,416.67 0.00 1,416.671.737101 992,200.003133EHWM10.00245,000.001106 245,000.00 2.200CRS1ST443.01 0.00 443.012.200101 245,000.0022766ACB90.00245,000.001107 245,000.00 2.150ENTRPR432.94 0.00 432.942.150101 245,000.0029367QCP10.00245,000.001108 245,000.00 1.750MSPRIV352.39 0.00 352.391.750101 245,000.0061760AEP00.00245,000.001109 245,000.00 1.800MORGST362.47 0.00 362.471.800101 245,000.0061747MA920.00245,000.001110 245,000.00 2.400KNOX483.28 0.00 483.282.400101 245,000.00499724AB80.00245,000.001111 245,000.00 2.050FREECU412.81 0.00 412.812.050101 245,000.0035638BAA90.00245,000.001112 245,000.00 2.5003RD503.42 0.00 503.422.500101 245,000.0088413QBY30.001,627,510.761114 1,627,510.76CALPRS0.00 0.00 0.00101 1,574,839.50SYS11140.001,000,000.001116 1,000,000.00 2.550FHLMC2,125.00 0.00 2,125.002.585101 1,000,000.003134GSCD50.00985,800.001117 1,000,000.00 1.500USTR1,243.09 0.00 1,243.091.534101 985,800.009128282Q20.00497,700.001118 500,000.00 1.850MCRSFT770.83 0.00 770.831.884101 497,700.00594918BV50.00245,000.001119 245,000.00 2.800ANECA563.84 0.00 563.842.800101 245,000.00034577AH90.00245,000.001120 245,000.00 2.550UNITY513.49 0.00 513.492.550101 245,000.0091330ABN60.00746,625.001122 750,000.00 2.750FHLMC1,718.75 0.00 1,718.752.801101 746,625.003134GSCQ60.00245,000.001123 245,000.00 2.900CITINA583.98 0.00 583.982.900101 245,000.0017312QJ260.00245,000.001124 245,000.00 2.7001STTCH543.70 0.00 543.702.700101 245,000.0033715LBJ80.00Portfolio CITYCPRun Date: 10/09/2019 - 11:41TE (PRF_TE) 7.3.6Report Ver. 7.3.6.1 CurrentRateEndingPar ValueEndingFundPage 3Book ValueBeginningBook ValueAdjusted Interest EarningsAccretionAmortization/EarningsAdjusted InterestJune 1, 2019 - June 30, 2019Total EarningsCity of La QuintaAnnualizedYieldCUSIP Investment #InterestEarnedIssuerRealizedGainl/LossFund: General Fund240,000.001125 240,000.00 2.950ENER581.91 0.00 581.912.950101 240,000.0029278TAY60.00240,000.001126 240,000.00 2.800FARMIG552.33 0.00 552.332.800101 240,000.0030960QAG20.00240,000.001127 240,000.00 2.700NORPNT532.60 0.00 532.602.700101 240,000.00666613GV00.00240,000.001128 240,000.00 2.800TOWNE552.33 0.00 552.332.800101 240,000.0089214PBL20.00240,000.001134 240,000.00 3.050UOFICU601.65 0.00 601.653.050101 240,000.0091435LAG20.00488,250.001138 500,000.00 1.125USTR458.56 0.00 458.561.143101 488,250.00912828VA50.00496,700.001139 500,000.00 1.750FNMA729.17 0.00 729.171.786101 496,700.003135G0ZG10.00492,000.001140 500,000.00 0.875FNMA364.58 0.00 364.580.902101 492,000.003135G0N330.000.001141 0.00 1.210FFCB319.31 0.00 5,569.311.240101 494,750.003133EGFU45,250.00491,750.001142 500,000.00 1.550FFCB645.83 0.00 645.831.598101 491,750.003133EHJA20.00245,000.001143 245,000.00 3.100ALLGNC624.25 0.00 624.253.100101 245,000.0001748DBE50.00245,000.001144 245,000.00 3.150RCB634.32 0.00 634.323.150101 245,000.0074934YAH40.00245,000.001145 245,000.00 2.750WEX553.77 0.00 553.772.750101 245,000.0092937CHG60.00245,000.001146 245,000.00 2.850EAGLE573.91 0.00 573.912.850101 245,000.0027002YDV50.00245,000.001147 245,000.00 3.1501STNBA634.31 0.00 634.313.150101 245,000.0032110YLK90.00245,000.001148 245,000.00 3.000TRAD604.11 0.00 604.113.000101 245,000.0089269CBX90.00245,000.001149 245,000.00 3.000PCSB604.11 0.00 604.113.000101 245,000.0069324MAD70.00240,000.001150 240,000.00 3.100GECRUN611.51 0.00 611.513.100101 240,000.00369674AV80.00249,000.001151 249,000.00 3.250NWENGL665.14 0.00 665.143.250101 249,000.0006426KAN80.0020,531,379.201153 20,531,379.20CAMP39,064.47 0.00 39,064.472.481101 16,492,314.73SYS11530.00245,000.001154 245,000.00 3.350JEFF674.59 0.00 674.593.350101 245,000.00474067AQ80.00248,000.001155 248,000.00 3.300MARBUS672.66 0.00 672.663.300101 248,000.0057116ARV20.00398,800.001156 400,000.00 3.000FHLMC1,000.00 0.00 1,000.003.051101 398,800.003134GSWS00.00378,360.001157 400,000.00 2.000MCRSFT666.67 0.00 666.672.144101 378,360.00594918BQ60.00247,275.001158 250,000.00 2.800FFCB583.34 0.00 583.342.870101 247,275.003133EJYL70.00487,950.001159 500,000.00 2.300P&G958.33 0.00 958.332.390101 487,950.00742718DY20.00245,000.001160 245,000.00 3.200MUNTRS644.38 0.00 644.383.200101 245,000.00625925AR30.00245,000.001161 245,000.00 3.350UBS674.59 0.00 674.593.350101 245,000.0090348JEJ50.00248,000.001162 248,000.00 3.400COMMBK693.04 0.00 693.043.400101 248,000.0020143PDV90.00248,000.001163 248,000.00 3.250MRRCK662.46 0.00 662.463.250101 248,000.0059013J4K20.00248,000.001164 248,000.00 3.550NMRCA723.62 0.00 723.623.550101 248,000.0067054NAN30.00248,000.001165 248,000.00 3.000FARMBU611.50 0.00 611.503.000101 248,000.00307660LC20.00248,000.001166 248,000.00 3.350REDRCK682.85 0.00 682.853.350101 248,000.0075701LAB30.00245,000.001167 245,000.00 3.200NEIGH644.38 0.00 644.383.200101 245,000.0064017AAQ70.00245,000.001168 245,000.00 3.1501STSRC634.31 0.00 634.313.150101 245,000.0033646CKP80.00248,000.001169 248,000.00 3.400MEDBA693.04 0.00 693.043.400101 248,000.0058404DCX70.00245,000.001170 245,000.00 3.400NLCOOP684.66 0.00 684.663.400101 245,000.00635573AL20.00Portfolio CITYCPRun Date: 10/09/2019 - 11:41TE (PRF_TE) 7.3.6Report Ver. 7.3.6.1 CurrentRateEndingPar ValueEndingFundPage 4Book ValueBeginningBook ValueAdjusted Interest EarningsAccretionAmortization/EarningsAdjusted InterestJune 1, 2019 - June 30, 2019Total EarningsCity of La QuintaAnnualizedYieldCUSIP Investment #InterestEarnedIssuerRealizedGainl/LossFund: General Fund248,000.001171 248,000.00 3.300MAINE672.65 0.00 672.653.300101 248,000.00560507AK10.00248,000.001172 248,000.00 3.350BARHAR682.85 0.00 682.853.350101 248,000.00066851WJ10.00248,000.001173 248,000.00 2.750MORTN560.54 0.00 560.542.750101 248,000.00619165JD60.00248,000.001174 248,000.00 3.000WELLS611.51 0.00 611.513.000101 248,000.00949763XY70.00485,250.001175 500,000.00 1.950COLGTE812.50 0.00 812.502.037101 485,250.0019416QEA40.00245,000.001176 245,000.00 2.500ALLY503.43 0.00 503.432.500101 245,000.0002007GHX40.00498,550.001177 500,000.00 2.500FHLB1,041.66 0.00 1,041.662.542101 498,550.003130AFW940.00489,687.501178 500,000.00 1.875USTR768.45 0.00 768.451.909101 489,687.509128282W90.00248,000.001179 248,000.00 2.8001STNBK570.73 0.00 570.732.800101 248,000.0032117BCX40.00248,000.001180 248,000.00 2.700VERUS550.36 0.00 550.362.700101 248,000.0092535LCD40.00248,000.001181 248,000.00 2.950NRTHWS601.32 0.00 601.322.950101 248,000.0066736ABP30.00100,115.921183 100,115.92STIFEL65.81 0.00 65.810.636101 0.00SYS11830.00248,000.001184 248,000.00 2.500CENTNX509.59 0.00 509.592.500101 248,000.00156634AK30.00245,000.001185 245,000.00 3.250JPMORG654.45 0.00 654.453.250101 245,000.0048128HXU70.00245,000.001186 245,000.00 2.400IOWAST483.28 0.00 483.282.400101 245,000.0046256YAZ20.00248,000.001187 248,000.00 2.400TSCOLA489.21 0.00 489.212.400101 248,000.0087266AAA10.00248,000.001188 248,000.00 2.600MAINST529.97 0.00 529.972.600101 248,000.0056065GAG30.00248,000.001189 248,000.00 2.500CONGRS509.58 0.00 509.582.500101 248,000.0020726ABA50.00496,650.001190 500,000.00 2.350WALMRT979.16 0.00 979.162.399101 496,650.00931142DU40.00492,100.001191 500,000.00 1.700FFCB708.34 0.00 708.341.751101 492,100.003133EGD280.00496,650.001192 500,000.00 1.750USTR713.32 0.00 713.321.747101 496,650.00912828SV30.00493,610.001193 500,000.00 1.375USTR563.53 0.00 563.531.389101 493,610.00912828R770.00245,000.001194 245,000.00 2.500PITTS402.74 0.00 402.742.500101 0.00725404AB30.00245,000.001195 245,000.00 2.550PLAINS410.79 0.00 410.792.550101 0.0072651LCL60.00248,000.001196 248,000.00 2.600EVNSCU317.98 0.00 317.982.600101 0.00299547AQ20.00248,000.001197 248,000.00 2.400LEGCY179.38 0.00 179.382.400101 0.00524661CB90.00499,500.001198 500,000.00 1.875FFCB286.46 0.00 286.461.903101 0.003133EKQP40.00248,000.001199 248,000.00 2.400CTZNST146.76 0.00 146.762.400101 0.00176688CP20.00248,000.001200 248,000.00 2.300AMERCU31.25 0.00 31.252.300101 0.0003065AAL70.00245,000.001201 245,000.00 2.150STRLNG43.29 0.00 43.292.150101 0.0085916VDC60.00248,000.001202 248,000.00 2.250COMMW30.58 0.00 30.582.250101 0.0020416TAQ50.00247,000.001203 247,000.00 2.300REVER46.69 0.00 46.692.300101 0.00761402BY10.00499,750.001204 500,000.00 1.900TOYOTA184.72 0.00 184.721.927101 0.0089236TCZ60.00147,057,365.42Subtotal 146,791,272.922.241261,899.990.00256,649.99131,218,383.825,250.00Fund: 1st Empire Securities Cash Bal0.001060 0.00EMPIRE0.00 0.00 0.00102 0.00SYS10600.00Portfolio CITYCPRun Date: 10/09/2019 - 11:41TE (PRF_TE) 7.3.6Report Ver. 7.3.6.1 CurrentRateEndingPar ValueEndingFundPage 5Book ValueBeginningBook ValueAdjusted Interest EarningsAccretionAmortization/EarningsAdjusted InterestJune 1, 2019 - June 30, 2019Total EarningsCity of La QuintaAnnualizedYieldCUSIP Investment #InterestEarnedIssuerRealizedGainl/Loss0.00Subtotal 0.000.000.000.000.000.00Fund: Fiscal Agent1,673.761058 1,673.76USBANK2.49 0.00 2.491.813231 1,671.27SYS10580.001,673.76Subtotal 1,673.761.8132.490.002.491,671.270.00Fund: Housing Authority : WSA and LQ242,947.261062 242,947.26LQPR0.00 0.00 0.00241 248,920.45SYS10620.00242,947.26Subtotal 242,947.260.000.000.00248,920.450.00Fund: SA Low/Mod Bond Fund16,363,851.431113 16,363,851.43 2.428LAIF34,505.54 0.00 34,505.542.566249 16,363,851.4325-33-0050.0016,363,851.43Subtotal 16,363,851.432.56634,505.540.0034,505.5416,363,851.430.00163,665,837.87Total 163,399,745.37 2.271296,408.020.00291,158.02147,832,826.975,250.00Portfolio CITYCPRun Date: 10/09/2019 - 11:41TE (PRF_TE) 7.3.6Report Ver. 7.3.6.1 City of La Quinta -City of La Quinta Purchases Report Sorted by Fund - Fund April 1, 2019 - June 30, 2019 Original Par Value Ending Book Value Sec. TypeFund Maturity YTM Accrued Interest at PurchasePayment Periods DateCUSIPInvestment #Issuer Purchase Date Principal Purchased Rate at Purchase General Fund 500,000.00 2.350 12/15/2022 496,650.00496,650.00 Received04/16/2019 2.79906/15 - 12/15WALMRT1190931142DU4MC2101 248,000.00 2.600 04/26/2024 248,000.00248,000.0004/26/2019 2.60305/26 - MonthlyMAINST118856065GAG3MC1101 248,000.00 2.500 04/28/2023 248,000.00248,000.0004/30/2019 2.50205/30 - MonthlyCONGRS118920726ABA5MC1101 245,000.00 3.250 05/16/2024 245,000.00245,000.0005/16/2019 3.25408/16 - QuarterlyJPMORG118548128HXU7MC1101 248,000.00 2.400 11/22/2021 248,000.00248,000.0005/22/2019 2.40706/22 - MonthlyTSCOLA118787266AAA1MC1101 245,000.00 2.400 05/23/2024 245,000.00245,000.0005/23/2019 2.40311/23 - 05/23IOWAST118646256YAZ2MC1101 500,000.00 1.700 11/01/2022 492,100.00492,100.00 Received05/28/2019 2.18111/01 - 05/01FFCB11913133EGD28FAC101 248,000.00 2.500 05/16/2024 248,000.00248,000.0005/29/2019 2.50306/29 - MonthlyCENTNX1184156634AK3MC1101 500,000.00 1.750 05/15/2022 496,650.00496,650.00 Received05/31/2019 1.98411/15 - 05/15USTR1192912828SV3TRC101 500,000.00 1.375 05/31/2021 493,610.00493,610.0005/31/2019 2.03011/30 - 05/31USTR1193912828R77TRC101 245,000.00 2.500 06/07/2023 245,000.00245,000.0006/07/2019 2.50212/07 - 06/07PITTS1194725404AB3MC1101 245,000.00 2.550 06/07/2024 245,000.00245,000.0006/07/2019 2.55312/07 - 06/07PLAINS119572651LCL6MC1101 248,000.00 2.600 06/12/2024 248,000.00248,000.0006/12/2019 2.60307/01 - MonthlyEVNSCU1196299547AQ2MC1101 248,000.00 2.400 06/19/2024 248,000.00248,000.0006/19/2019 2.40307/19 - MonthlyLEGCY1197524661CB9MC1101 500,000.00 1.875 12/12/2022 499,500.00499,500.00 Received06/20/2019 1.90512/12 - 06/12FFCB11983133EKQP4FAC101 248,000.00 2.400 06/21/2024 248,000.00248,000.0006/21/2019 2.40307/21 - MonthlyCTZNST1199176688CP2MC1101 500,000.00 1.900 04/08/2021 499,750.00499,750.00 Received06/24/2019 1.92810/08 - 04/08TOYOTA120489236TCZ6MC2101 248,000.00 2.300 06/28/2022 248,000.00248,000.0006/28/2019 2.30207/28 - MonthlyAMERCU120003065AAL7MC1101 248,000.00 2.250 06/28/2024 248,000.00248,000.0006/28/2019 2.25308/01 - MonthlyCOMMWD120220416TAQ5MC1101 247,000.00 2.300 06/28/2024 247,000.00247,000.0006/28/2019 2.30312/28 - 06/28REVER1203761402BY1MC1101 245,000.00 2.150 08/29/2022 245,000.00245,000.0006/28/2019 2.15312/28 - 06/28STRLNG120185916VDC6MC1101 Subtotal 6,682,260.006,682,260.00 0.006,704,000.00 6,682,260.00Total Purchases 6,704,000.00 0.00 6,682,260.00 Received = Accrued Interest at Purchase was received by report ending date. Portfolio CITY CP Run Date: 08/28/2019 - 16:38 PU (PRF_PU) 7.1.1 Report Ver. 7.3.6.1 City of La Quinta -City of La Quinta Maturity Report Sorted by Maturity Date Received or due during April 1, 2019 - June 30, 2019 Rate at MaturityPar Value Sec. TypeFund Maturity Date Maturity ProceedsInterest Income Net CUSIP Investment #Issuer Purchase Date Book Value at Maturity 500,000.00 1.125 502,812.502,812.5005/10/2018FHLMC11293137EADZ9FAC10104/15/2019 7,562.50495,250.00 240,000.00 1.800 242,154.082,154.0804/23/2014WEB104294768NJQ8MC110104/23/2019 2,154.08240,000.00 240,000.00 1.650 241,963.731,963.7304/30/2014EPHRAT1016294209AQ4MC110104/30/2019 1,963.73240,000.00 240,000.00 2.200 245,280.005,280.0005/16/2018UNION113690521AQW1MC110105/16/2019 5,280.00240,000.00 240,000.00 1.750 242,082.742,082.7405/20/20141STBUS101931938QH72MC110105/20/2019 2,082.74240,000.00 240,000.00 1.750 240,011.5111.5105/19/2014GCB1024402194EB6MC110105/20/2019 11.51240,000.00 240,000.00 2.200 245,280.005,280.0005/24/2018CNBF113217801DDT0MC110105/24/2019 5,280.00240,000.00 240,000.00 1.800 240,355.07355.0705/28/2014PEAPAC1031704692AL6MC110105/28/2019 355.07240,000.00 1,000,000.00 1.500 1,007,500.007,500.0005/10/2018USTR1130912828WL0TRC10105/31/2019 14,900.00992,600.00 248,000.00 1.400 248,294.88294.8806/04/2015SOLOM103583427LAX2MC110106/04/2019 294.88248,000.00 248,000.00 1.500 248,315.95315.9506/05/2015CONNEC101120786ABD6MC110106/05/2019 315.95248,000.00 500,000.00 1.210 503,025.003,025.0005/31/2018FFCB11413133EGFU4FAC10106/20/2019 8,275.00494,750.00 4,207,075.46Total Maturities 4,176,000.00 31,075.464,158,600.00 48,475.46 Portfolio CITY CP Run Date: 08/28/2019 - 16:41 MA (PRF_MA) 7.1.1 Report Ver. 7.3.6.1 City of La Quinta -City of La Quinta Sales/Call Report Sorted by Maturity Date - Fund April 1, 2019 - June 30, 2019 Redem. Date Redemption Principal Redemption Interest Book Value at Redem. Total Amount Net IncomeFundMatur. Date Rate at Redem. Par ValueSec. TypeCUSIPInvestment # Issuer Purchase Date 02/28/2023 1,000,000.00 999,000.00 1,000,000.00 6,562.5011213130ADMF605/28/2019 1,006,562.50 7,562.50101FHLB FAC 02/28/2023 04/02/2018 2.625 V Call Subtotal 999,000.00 1,000,000.00 6,562.501,000,000.00 1,006,562.50 7,562.50 1,000,000.00Total Sales 1,000,000.00 6,562.50999,000.00 1,006,562.50 7,562.50 Portfolio CITY CP Run Date: 08/28/2019 - 16:42 SA (PRF_SA) 7.1.1 Report Ver. 7.3.6.1 V - Security with variable rate change. US Treasury Rates https://www.treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=yieldYear&year=2019 Commercial Paper Rates https://www.federalreserve.gov/releases/cp/rates.htm City of La Quinta FINANCIAL ADVISORY COMMISSION MEETING: October 9, 2019 STAFF REPORT AGENDA TITLE: REVIEW AND APPROVE CASH MANAGEMENT POLICY RECOMMENDATION Review and approve a Cash Management Policy. EXECUTIVE SUMMARY •The Financial Advisory Commission (FAC) is asked to review, discuss and approve the Cash Management Policy (Policy). •The Policy is new and would provide guidelines for standard citywide practices for receiving, processing, and handing cash. •Staff and City Attorney have reviewed the proposed Policy. The Policy conforms to current laws and governmental accounting best practices. •Subsequent to FAC approval the Policy will be presented to City Council for adoption. FISCAL IMPACT The adoption of this Policy does not have a monetary impact. However, the approval of this policy will provide standard guidelines for handling cash. BACKGROUND/ANALYSIS As an advisor to the Finance department, the FAC is asked to review, discuss, and approve the recommended Policy. The City does not currently have a policy governing cash management but follows the procedures outlined in the Policy. Adoption of a formal Policy was recommended by two external agencies – the City’s primary insurance carrier, California Joint Power Insurance Authority (CJPIA) and the State of California Department of Transportation (CalTrans). The Policy establishes Citywide standard guidelines for the management of cash and cash equivalent transactions such as credit cards and checks. Furthermore, the Policy references additional reporting requirements for Federally funded procurements as governed under the Code of Federal Regulations (CFR) Title 2 Grant and Agreements, Part 200 Uniform Administrative Requirements, Cost BUSINESS SESSION ITEM NO. 1 Principles and Audit Requirements for Federal Awards, commonly known as Uniform Grant Guidance (UGG). To ensure compliance with current laws and regulatory requirements, the Policy was reviewed by staff and City Attorney. ALTERNATIVES: The purpose of this item is to receive input from the Commission. The Commission may either approve as presented or recommend further changes, which adhere to external regulatory requirements. Prepared by: Claudia Martinez, Senior Accountant Approved by: Karla Romero, Finance Director Attachment: 1. Cash Management Policy - DRAFT 1 of 8 CASH MANAGEMENT POLICY 1. PURPOSE The purpose of this Cash Management Policy is to provide guidelines for standard citywide cash handling practices in order to ensure proper and consistent procedures for receiving, processing, and handling cash. 2. SCOPE This policy applies to all City Funds, employees, departments, volunteers, vendors, or other persons whose assigned duties involve handling City cash or funds must comply with the policies and procedures contained herein. Departments are responsible for ensuring that every employee, volunteer, vendor, or other person whose assigned duties involve handling City cash or funds adheres to this Policy. 3. GENERAL POLICY It is City of La Quinta’s (City) policy to protect the City’s assets, including cash, from theft, loss and misuse; and to ensure that the City receives, accurately records, and promptly deposits all cash and cash equivalents to which the City is entitled. Cash: may be comprised of, but not limited to coin, currency, checks, money orders, debit and credit card transactions, and electronic fund transfers. The City currently has designated revenue collection sites including: a. Finance Department b. The Hub c. Wellness Center d. Museum & Library e. SilverRock Golf Course f. Special Events - On an as needed basis, there may be situations requiring establishment of temporary receipting points, which collect cash on an ad-hoc basis (e.g. community festivals, golf tours). 4. MANAGEMENT OF CASH All City bank accounts shall be carried in the name of the City with additional secondary designations within the bank account name as to the purpose of the bank account, where appropriate (e.g. SilverRock Golf Resort, La Quinta Housing Authority). 5. CASH RECEIPTING Cash receipting, for the purpose of this policy, encompasses the following: a. Accounting for cash as it is received b. Pre-numbered consecutive receipts to be provided for cash received c. Adequate separation of duties (collection, depositing, and reconciling) d. Refunds, voids, and cash over/short transactions ATTACHMENT 1 2 of 8 6. SEGREGATION OF DUTIES Collection of cash, deposit preparation, and reconciliation duties shall be performed by separate individuals, but at a minimum, reconciliation should be done by a separate person. The employee who physically collects the cash cannot be the same individual performing the reconciliation duties. In the event segregation of duties is not possible, the department shall work with the Finance Department to establish agreed upon internal control procedures. 7. FINANCE DEPARTMENT RESPONSIBILITY It is the responsibility of the Finance Department to track and ensure the timely deposit of City funds collected or generated at authorized locations and account for all funds submitted by all revenue collection sites. The Finance Department will assist and provide materials needed to departments and cashiers as follows: a. Provide cash handling training to City departments and employees. b. Perform cash deposit reconciliations between bank records and cash receipt vouchers that are input into the financial system. Any discrepancies resulting from errors by the bank or the City will be resolved by the Finance Department. c. Provide revenue collection sites with a change fund to allow cashiers to give change to customers. The Finance Department is responsible for establishing citywide practices, providing forms, and other actions necessary to implement the Cash Management Policy. 8. DEPARTMENT RESPONSIBILITY Cash handling involves special control measures that must be monitored continually by supervisory personnel within each department that maintains cash in order to detect any weaknesses. Department heads are responsible for conducting periodic reviews of their department cash handling activities to ensure these procedures are understood and followed consistently by staff. The responsibilities of City employees and their supervisors who are involved in the handling of cash on behalf of the City include: a. Cash receipting b. Distribution of petty cash c. Reconciling of cash receipts d. Depositing of cash e. Safeguarding of cash f. Reporting of cash transactions and variances 9. SAFEGUARDING OF CASH The City shall maintain, as deemed appropriate, physical security systems (i.e. safes, alarms, panic buttons, motion detectors, security cameras, etc.) to ensure the safety of personnel and funds in areas where cash is collected, reconciled, and stored. In addition, access to counter, cash handling, and storage areas will be restricted to authorized personnel. The safeguarding of cash relates to the processing, storing, and transporting of cash and to the safekeeping of keys and safe combinations. Each location maintains at least one safe 3 of 8 that is used to hold cash, change boxes, point of sale cash drawers, bank deposits, and transaction records/receipts. Safes have adequate locking mechanisms and keys to change boxes are kept in locked cabinets. To ensure internal controls, access is limited to select personnel and combinations are updated regularly and never shared. The employee is responsible for verifying the cash drawer contains the designated starting balance prior to processing any payments. Verification of cash in drawer will take place in the area designated for balancing drawers. The employee is responsible for the contents, security, and keys for the cash drawer at all times. The employee must lock all cash and cash equivalents in a drawer or other secure location whenever leaving the workstation, including for break and lunch periods. The employee shall maintain adequate change in their drawers. Change can be requested through a supervisor or directly from the Finance Department. Cash funds must not be left unattended. Cash shall always be stored in a locked, secured location until it is deposited. Access to the secured area should be limited to authorized individuals only. 10. DEPOSITING OF FUNDS All cash collections are to be deposited. Collections may not be reserved for petty cash or used to pay department expenses. Deposits of cash on hand shall be made no less than weekly. In order to maintain an efficient cashiering service at the cash collection sites where the City accepts payments, the City’s policy regarding reasonable amounts and denominations of coinage the City will accept as a form of payment is: a. City personnel will not accept over $10.00 in unrolled coins or $20.00 in rolled coins in sleeves per payment. b. Customers will indicate their name and phone number on each roll in order to provide contact information in the event questions arise on the coin roll. Regular reconciliations are to be prepared at the departmental level to confirm that all receipts have been recorded in the point of sale system. A designated employee at the departmental level prepares deposits and a separate employee documents those reconciliations. The supervisor shall keep a log on overages/shortages by cashier. This log shall be reviewed to identify areas of improvement in cash handling procedures. On any overage/shortage the cashier shall prepare a written explanation as to what occurred and attach it to the reconciliation. The Finance Department shall ensure all transactions are properly recorded in the general ledger. 11. PROCESSING INCOMING MAIL All correspondence shall be forwarded to the appropriate department to open incoming checks, sort, and enter them into the check log before forwarding to the appropriate staff member for processing. A reconciliation of the check log should be performed on a regular basis to ensure that all checks are being processed in the appropriate point of sale system and accounted for in deposits. 4 of 8 12. REPORTABLE LOSSES Any instance of known or suspected loss or misappropriation of cash or checks shall be reported to the Finance Director, Department Director, and Human Resources immediately. In the event of a robbery or burglary, police authorities should be notified immediately along with Human Resources and the City Manager. 13. RETURNED CHECKS Upon receipt of a non-sufficient funds (NSF) check, the Finance Department will provide a copy of the returned check to the appropriate department and request the original transaction information to adjust the appropriate cash and revenue accounts to which the monies were originally recorded. If the check was applied to an accounts receivable invoice, a new invoice will be generated showing the amount unpaid. The Finance Department will promptly notify the payer via a letter after the NSF check is received. The payer has ten (10) business days after receipt of the letter to respond to the City. Payer must renegotiate the payment with cash, cashier’s check, money order, or credit/debit card. All checks returned by the bank for non-sufficient funds or other reasons may be subject to a returned check fee as adopted in the Citywide fee schedule. 14. REFUNDS, VOIDS, AND CASH DISCREPANCIES All refunds, voids, and cash discrepancies transactions are to be reviewed and authorized by the employee’s supervisor - cash discrepancies occur where the physical cash holdings differ to that specified by the cash receipting system. Refunds are typically not permitted to be processed at locations which take payments and handle cash. If a customer requires a refund, a request shall be submitted through the Finance Department. All refunds and voided transactions shall have the following supporting documentation: a. Transaction date b. Customer name, address, phone number, and signature c. Original customer receipt d. Reason for the refund or voided transaction e. Amount and form of payment f. Signature of cashier requesting the refund or void g. Signature of supervisor approving the transaction In the case of an overage or shortage, every effort should be made to locate amounts causing the out of balance condition regardless of the amount. The employee and supervisor must sign an over/short report with an indication of the reason, if known, for the difference. 15. UNCLAIMED PROPERTY Finance may void and reissue old/stale dated checks in an effort to notify/pay vendors for City checks that remain outstanding prior to one year. Unclaimed property is considered unclaimed after a period of time that a check remains outstanding. The City shall follow Escheatment and Unclaimed Property Procedures established in the Accounts Receivables Write-Offs and Unclaimed Property Policy. 16. DISBURSEMENT OF CITY FUNDS Electronic distribution, such as wire transfers, of funds will be initiated by the Finance Department. Authority to transfer monies shall be properly documented and verified by the Finance Department. All wire transfer requests must provide the following: 5 of 8 a. Wiring instructions from beneficiary b. Wire transfer of funds document(s) properly completed and signed by the employee requesting the wire transfer and the Department Director or designee. c. Backup documentation supporting the wire (invoice, purchase order number, memo, City Council approval if applicable, etc.) d. All wire transfers will require a dual-approval process whereby initiation and approval of the wire will be completed by separate members of the finance staff. 17. PETTY CASH FUNDS The Purchasing and Contracting Policy of the City will establish a maximum size for petty cash payments from the petty cash fund. Petty cash should be used as a convenient method to pay small claims and is not intended for larger or frequent payments, which should be paid through Accounts Payable. The petty cash fund must be kept in a safe or locked cabinet under the control of the responsible person within the department. The petty cash fund must at all times contain the authorized amount in cash and/or paid vouchers. The fund may not be used for personal loans, cashing checks, or for salaries. To replenish the petty cash fund, a Petty Cash Reimbursement Form must be completed. The form would show persons reimbursed, the amounts, and account numbers to be charged and signature of the cash disbursement. All receipts must be attached with approvals from the signing authority for the account charged. Funds received from any source must not be added to the petty cash fund, funds must be processed per the procedures for the revenue collection site. 18. RECONCILIATION Each business day, designated employee(s) shall ensure payments processed and payments received are reconciled. Management shall review and approve the overall daily cash receipt reconciliation to ensure all cash receipts are accounted for and match to the daily cash deposit, prior to submission to the Finance Department. 19. AUDITS The Finance Department conducts random audits at least twice a year at every location which handles payments. The audits include verifying cash tills, change boxes, and petty cash balances to the amounts allocated and recorded by the Finance Department. 20. CASH HANDLING POLICY REVIEW The Finance Director shall review this Policy annually to ensure careful and responsible management over City resources and if applicable recommend any changes to the City Manager and City Council. 21. FEDERALLY FUNDED PROCUREMENTS The following section outlines the allowable costs for grants, contracts, and sub-awards at the City of La Quinta. The policy is justified by the requirement of the Code of Federal Regulations (CFR) Title 2 Grants and Agreements, Part 200 Uniform Administrative Requirements, Cost Principles and Audit Requirements for Federal Awards, commonly known as Uniform Grant Guidance (UGG). It provides the basic criteria to determine direct allowable and indirect allocable costs on federally funded programs regardless of the 6 of 8 funding agency sponsoring the program. The City’s shall adhere to the UGG Administrative Requirements as updated. 200.305 Payment Generally, the City receives payments of federal award funds on a reimbursement basis. In some cases, the City may receive an advance of federal grant funds. a. Reimbursements • The City will request reimbursement for actual expenditures incurred under federal grants at least quarterly, or more often as deemed appropriate. • Reimbursement requests will be submitted with appropriate documentation and signed by the City’s designated representative. All reimbursements are based on actual disbursements, not on obligations. • The City will maintain supporting documentation of federal expenditures (invoices, payroll records, etc.) and will make such documentation available to awarding agencies upon request. b. Advances • When the City receives advance payments of federal grant funds, it must minimize the time elapsing between the transfer of funds from the United States Treasury or the pass-through entity and the disbursement of those funds on allowable costs of the applicable federal program. (2 CFR 200.305) • To the extent available, the City will disburse funds available from program income (including repayments to a revolving fund), rebates, refunds, contract settlements, audit recoveries, and interest earned on such funds before requesting additional cash payments. (2 CFR 200.305) • The City will maintain advance payments of federal awards in insured, interest-bearing accounts whenever not precluded by the Federal award grant guidance or whenever the exceptions per 2 CFR 200.305(8) do not apply. Interest amounts up to $500 per year may be retained by the City for administrative expense. Any additional interest earned on Federal advance payments deposited in interest-bearing accounts must be remitted annually to the Department of Health and Human Services Payment Management System (PMS) through an electronic medium using either Automated Clearing House (ACH) network or a Fedwire Funds Service payment. [2 CFR 200.305(9)] Allowable Costs 2 CFR, part 200, subpart E, Cost Principles identifies direct and indirect costs that can be charged to federal awards; it also identifies those costs that cannot be charged to grant agreements and that are considered unallowable expenses. The City adopts the five tests provided by this regulation to determine the allowability of costs applied to federally funded services: a. Reasonability: For a cost to be considered reasonable, it must be necessary for fulfillment of the grant objective; acquired by means consistent with federal and state laws and regulations, and consistent with City policies and practices. b. Allocability: A cost is allocable to a program if the goods/services involved are charged in accordance with the relative benefits received by that program. To be considered allocable, a cost must be incurred solely to advance the work under the sponsored program or benefit both the sponsored program and other programs of 7 of 8 the City in proportions that can be approximated through use of the City cost allocation methods not to exceed the limit imposed by the grant agreements. c. Consistency: Similar costs are treated as direct or Facilities and Administration (F & A) costs when incurred in like circumstances. Costs that are generally charged as direct cost to a sponsored program should not be included as F&A costs on other projects when incurred for the same purposes. Where the City treats a particular type of cost as a direct cost of sponsored programs, all costs incurred for the same purpose in like circumstances shall be treated as direct costs of all other activities of the City. d. Limitation: Cost must conform to any limitations or exclusions in the sponsored agreement. e. Documentation: Cost must be adequately documented. Expenditures must be aligned with approved budgeted items. Any deviation from the approved award budget will require prior approval from the awarding agency. Allowability of costs will be determined prior to obligating and spending federal funds on a proposed good or service. State and City rules or policy must also be considered. Whichever allowability requirements are stricter will govern whether a cost is allowable. a. Except where otherwise authorized by statute, costs must meet the following general criteria in order to be allowable under Federal awards per 2 CFR 200.403: • Be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. • Conform to any limitations or exclusions set forth in these principles or in the Federal award as to types or amount of cost items. • Be consistent with policies and procedures that apply uniformly to both federally financed and other activities of the City. • Be accorded consistent treatment. A cost may not be assigned to a Federal award as a direct cost if any other cost incurred for the same purpose in like circumstances has been allocated to the Federal award as an indirect cost. • Not be included as a cost or used to meet cost sharing or matching requirements of any other federally financed program in either the current or a prior period. Also, reference § 200.306, Cost sharing or matching, paragraph (b). • Be adequately documented. Also, reference §§ 200.300, Statutory and national policy requirements, through 200.309, Period of performance, of 200 CFR Part 200. Direct Costs Direct costs are those costs that can be identified specifically with a particular award, costs that can be directly assigned to an activity with a high degree of accuracy will be directly imputed to that activity. Identification with the grant rather than the nature of the goods and services involved is the determining factor in distinguishing direct from indirect F&A costs of grant agreements. Examples of some of the costs charged directly include: a. Personnel salaries/fringe benefits b. Capital expenditures c. Software 8 of 8 d. Consultants e. Equipment f. Materials and supplies Facilities and Administrative Costs (Indirect/Overhead Costs) Costs incurred for common or joint objectives that cannot be identified specifically with a sponsored program are treated as indirect costs. Examples of indirect costs include: a. Utilities b. Maintenance and operation c. Building and equipment expenses d. Administrative costs Most grant agreements include a percentage of the direct cost to cover these charges known as the Facilities and Administrative Cost Rate (F&A), refer to individual grant agreement guideline for indirect cost rate. Federal regulations limit instances where administrative costs can be charged directly to grants and contracts. An exception may be made if there is extensive use of such expenses, the expenses have been properly justified/documented in the grant/contract proposal, and they have been approved as a direct cost by the appropriate federal agency. Examples below list the types of expenses that are generally not allowable as a direct cost: a. Administrative and clerical salaries and wages b. Printing and copying costs c. Office supplies d. Postage and mail e. Telephone and internet 22. POLICY REVIEW The Finance Director and administrators of federal funds shall review this Policy annually and recommend any changes to the City Manager and City Council. City of La Quinta FINANCIAL ADVISORY COMMISSION MEETING: October 9, 2019 STAFF REPORT AGENDA TITLE: REVIEW BROKER/DEALER SELECTION AND APPROVE EDITS TO INVESTMENT POLICY ADDING NEW BROKERS TO APPROVED FINANCIAL INSTITUTIONS LIST RECOMMENDATION Review broker/dealer selection and approve edits to Investment Policy adding new brokers to approved financial institutions list. EXECUTIVE SUMMARY •Request for Information (RFI) for Investment Broker/Dealer Services was issued on March 1, 2019 and June 5, 2019. •The review and selection committee included two Financial Advisory Commissioners and two Finance Staff. •Fourteen broker/dealer firms responded to the RFI; after comprehensive review of the qualifications four were selected for interviews conducted by the review and selection committee. •The review and selection committee recommends adding Higgins Capital Management and Great Pacific Securities to the approved list for broker/dealer services. FISCAL IMPACT There is no fiscal impact to add broker/dealers, fees are paid with investment transactions as they occur. However, there is the potential of positive impact to the investment returns through competitive bidding for securities purchases. BACKGROUND/ANALYSIS The City is currently conducting securities trades with one approved broker/dealer, Stifel, Nicholas & Company, Inc. While we are pleased with the current level of service provided, as a matter of best practice and financial due diligence it was determined that it was in the best interest of the City to have multiple broker/dealers from which to choose. The City initially issued the RFI for Investment Broker/Dealer Services on March 1, 2019 and subsequently reissued to RFI on June 5, 2019. The initial RFI included eleven responses, which all continued to participate on the reissued BUSINESS SESSION ITEM NO. 2 RFI. An additional three brokers responded to the subsequent RFI for a total of 14 respondents. The review and selection committee included two Financial Advisory Commission members (Commissioners Rosen and Hoffner) and two finance staff members (Finance Director and Finance Analyst). After an in-depth review of all submissions, the committee interviewed four brokers. Broker evaluations were based on the following criteria: Qualifications and Experience: The organizational affiliations, financial experience, compliance and financial reports, broker resumes, and RFI questionnaire responses. Fees: Fees for all services including administrative, reporting, and transactional. Ongoing administration: Level of effort to maintain the relationship, monitoring investment performances, reporting documents, and ongoing support provided by the broker. Other considerations: Integration with current financial reporting investment software, online accessibility to reports, fraud prevention, and data security. Both recommended brokers (Higgins Capital Management and Great Pacific Securities) have long-standing client relationships with California cities, counties, and/or agencies, offer financial market information and research reports, and are highly involved in professional government organizations which provide education and trainings to municipal government staff. ALTERNATIVES No alternatives are recommended. Prepared by: Rosemary Hallick, Financial Services Analyst Approved by: Karla Romero, Finance Director Attachments: 1. 2019/20 Investment Policy (red lined) Fiscal year 2019/2020 Table of Contents Section Topic Page Executive Summary 1 I General Purpose 2 II Investment Policy 2 III Scope 2 IV Objectives 3 V Maximum Maturities 5 VI Prudence 5 VII Authority 5 VIII Ethics and Conflicts of Interest 6 IX Authorized Financial Dealers and Institutions 6 X Permissible Deposits and Investments 7 XI Investment Pools 10 XII Payment and Custody 10 XIII Interest Earning Distribution Policy 11 XIV Internal Controls and Independent Auditors 11 XV Reporting Standards 12 XVI Review of Investment Portfolio 13 XVII Financial Advisory Commission – City of La Quinta 13 XIII Investment Policy Adoption 13 Appendices Topic Page A Municipal Code Ordinance 2.70 – Financial Advisory Commission 14 B Municipal Code Ordinance 3.08 – Investment of Moneys and Funds 16 C Segregation of Major Investment Responsibilities 18 D Listing of Approved Financial Institutions 19 E Investment Management Process and Risk 20 F Glossary 22 ATTACHMENT 1 CITY OF LA QUINTA Investment Policy Fiscal Year 2019/2020 Executive Summary The general purpose of this Investment Policy is to provide the rules and standards that must be followed in administering the City of La Quinta's (the “City”) deposits and investments. The City's Investment Policy conforms to all state and local statutes and applies to all deposits and investments of the City, with the exception of bond proceeds and those noted in section III herein. It is the City's policy to deposit and invest public funds in a manner that shall provide safety of principal, liquidity to meet all of the City’s obligations and requirements that may be reasonably anticipated, and a risk-based market rate of return. Authority to manage the City's investment portfolio is derived from the City Municipal Code. Management responsibility for the investment program is delegated to the City Treasurer, who shall establish and implement written procedures for the operation of the City's investment program consistent with the Investment Policy. The City Manager, City Treasurer and city employees involved in the City's banking and investment process shall conduct the City's business in an ethical manner and refrain from any activity or relationship that may be, or have the appearance of, a conflict of interest. The Investment Policy shall be adopted by resolution of the La Quinta City Council on an annual basis, before the end of each fiscal year (June). City of La Quinta Statement of Investment Policy July 1, 2019 through June 30, 2020 Adopted by the City Council on June 4, 2019 I. GENERAL PURPOSE The general purpose of this document is to provide the rules and standards that must be followed in administering the City of La Quinta's deposits and investments. II. INVESTMENT POLICY It is the policy of the City of La Quinta to deposit and invest public funds in a manner that shall conform to all State and local statutes governing the investment of public funds and set forth the permissible deposits and investments of the City's funds and the limitations thereon. III. SCOPE Except as further detailed in Sections XVI and XVII, this Investment Policy applies to all deposits and investments of the City of La Quinta, the Successor Agency to the City of La Quinta Redevelopment Agency, and the City of La Quinta Financing and Housing Authorities. These funds are reported in the City's Comprehensive Annual Financial Report (CAFR) and include all funds within the following fund types:  General  Special Revenue  Capital Projects  Debt Service  Enterprise  Internal Service  Trust and Agency  Any new fund types and fund(s) that may be created. Financial assets and investment activity not subject to this policy The City's Investment Policy does not apply to the following:  Cash and Investments raised from Conduit Debt Financing;  Funds held in trust in the City's name in pension or other post-retirement benefit programs;  Cash and Investments held in lieu of retention by banks or other financial institutions for construction projects; and  Short or long-term loans made to other entities by the City or Agency,  Short term (Due to/from) or long term (Advances from/to) obligations made either between the City and its funds or between the City and Agency.  Investment of bond proceeds: The City's Investment Policy shall not govern bond proceeds and bond reserve fund investments. California Code Section 5922(d) governs the investment of bond proceeds and reserve funds in accordance with bond indenture provisions. Arbitrage Requirement - The US Tax Reform Act of 1986 requires the City to perform arbitrage calculations as required and return excess earnings to the US Treasury from investments of proceeds of bond issues sold after the effective date of this law. These arbitrage calculations may be contracted with an outside source to provide the necessary technical assistance to comply with this regulation. Investable funds subject to the 1986 Tax Reform Act will be kept segregated from other funds and records will be kept in a fashion to facilitate the calculations. The City's investment position relative to the new arbitrage restrictions is to continue pursuing the maximum yield on applicable investments while ensuring the safety of capital and liquidity. It is the City's position to continue maximization of yield and to rebate excess earnings, if necessary. IV. OBJECTIVES The objectives of the City's investment activity, in order of priority and importance, are: A. Safety of Principal Safety of principal is the foremost objective of the City's investment program. Investments shall be undertaken in a manner that seeks to ensure the preservation of principal of the overall portfolio in accordance with the permissible deposits and investments. The City shall endeavor to preserve its investment principal by making only permissible deposits and investments, undertaken in a controlled manner to minimize the possibility of loss or misappropriation through malfeasance or otherwise. Investments not backed by the full faith and credit of the United States Government shall be diversified by allocating assets between different types of permissible investments, maturities, and issuers as a means to mitigate credit risk and interest rate risk. 1. Credit Risk is the risk of loss from the failure of the security issuer or backer. Credit risk may be mitigated by: • Limiting investments to investment grade securities as permitted in Section X; and • Diversifying the issuers of the securities in the investment portfolio so that potential losses due to issuer failure or individual securities downgrades may be minimized. 2. Interest Rate Risk is the risk that market values of securities in the portfolio will decline due to changes in general interest rates. Interest rate risk may be mitigated by: • Structuring the investment portfolio so that securities mature to meet cash requirements for ongoing operations, thereby avoiding the need to sell securities on the open market prior to maturity; and • Investing operating funds primarily in shorter-term securities. 3. Liquidity Risk is the risk that a security cannot be liquidated because of its unique features or structure or because it is thinly traded. Liquidity risk is not a material issue for the City's portfolio because of the permissible deposits and investments (see Section X). A discussion of the City's investment process and risk is presented in Appendix E. B. Provide Liquidity The investment portfolio shall remain sufficiently liquid to meet all of the City's cash needs that may be reasonably anticipated. This is accomplished by structuring the portfolio so that sufficient liquid funds are available to meet anticipated demands. Furthermore, since all possible cash needs cannot be anticipated the portfolio should be diversified and consist of securities with active secondary or resale markets. The City's policy is to generally hold securities and other investments to maturity. Accordingly, securities may be sold prior to maturity under certain circumstances as follow: • A security with declining credit quality can be sold early to minimize loss of principal. • Unanticipated liquidity needs of the portfolio require that one or more securities be sold. • When a sale/repurchase is fiscally advantageous based on market conditions and fits the needs of the portfolio C. Yield a Risk-Based Market Rate of Return The City's investment portfolio shall be structured with the objective of yielding a risk- based market rate of return throughout budgetary and economic cycles. Return on investment is less important than the safety and liquidity objectives described above. The City's Investment Policy does not specify a single benchmark as a goal or target yield for a rate of return on its investment portfolio. The portfolio's rates of return will be influenced by several factors, including actions by the Federal Reserve Board, the marketplace, and overall economic perceptions and conditions. Performance Standards: As a basis for comparison only, the Treasurer's quarterly reports will display the rates of return on the three-month Bill, six-month Bill, and one and two-year U.S. Treasury Note, comparable-period rates for commercial paper, and the yield for the State Treasurer's Local Agency Investment Fund (LAIF). The Treasurer may use these or any other published rates of return that the Treasurer deems appropriate for comparison to the return on the City's investment portfolio. The investment portfolio shall be designed with the objective of obtaining a market rate of return throughout budgetary and economic cycles, commensurate with the investment risk constraints and the cash flow needs. V. MAXIMUM MATURITIES It is the City's policy to generally hold securities and other investments until maturity. This buy- and-hold policy shall not prevent the sale of a security as listed in section IV.B The general buy-and-hold strategy requires that the City's investment portfolio be structured so that sufficient liquid funds are available from maturing investments and other sources to meet all reasonably anticipated cash needs. The City shall follow Title 5 of the California Government Code §53601 (the “State Code”) regarding maximum maturities, in that “no investment shall be made in any security…that at the time of the investment has a term remaining to maturity in excess of five years”. VI. PRUDENCE and FIDUCIARY DUTY The City shall follow the State Code §53600.3 regarding fiduciary duty and the Prudent Investor Standard as follows: Except as provided in subdivision (a) of §27000.3, all governing bodies of local agencies or persons authorized to make investment decisions on behalf of those local agencies investing public funds pursuant to this chapter are trustees and therefore fiduciaries subject to the prudent investor standard. When investing, reinvesting, purchasing, acquiring, exchanging, selling, or managing public funds, a trustee shall act with care, skill, prudence, and diligence under the circumstances then prevailing, including, but not limited to, the general economic conditions and the anticipated needs of the agency, that a prudent person acting in a like capacity and familiarity with those matters would use in the conduct of funds of a like character and with like aims, to safeguard the principal and maintain the liquidity needs of the agency. Within the limitations of this section and considering individual investments as part of an overall strategy, investments may be acquired as authorized by law. VII. AUTHORITY Authority to manage the City's investment portfolio is derived from Chapter 3.08 of the City's Municipal Code. Management responsibility for the investment program is delegated to the City Treasurer for a period of one year pursuant to the City Council's annual adoption of the Investment Policy. The City Treasurer shall establish written procedures for the operation of the investment program consistent with the Investment Policy. Procedures should include reference to safekeeping, wire transfer agreements, banking service contracts, and collateral/depository agreements. Such procedures shall include explicit delegation of authority to persons responsible for investment transactions. No person may engage in an investment transaction except as provided under the terms of this Investment Policy and the procedures established by the City Treasurer. The City Treasurer shall be responsible for all transactions undertaken and shall establish a system of controls to regulate the activities of subordinate officials. VIII. ETHICS AND CONFLICTS OF INTEREST The City Manager, City Treasurer and city employees involved in the City's banking and investment process shall conduct the City's business in an ethical manner and refrain from any activity or relationship that may be, or have the appearance of, a conflict of interest. The City will maintain compliance with the procedures set forth in the Conflicts of Interest and Acceptance of Gifts and other Gratuities section of the City of La Quinta Personnel Manual and the City’s Municipal Code Chapter 2.60 Conflicts of Interest. Any questionable activity or relationship shall be reported immediately; reporting must be made in accordance with the personnel policies of the City and, until resolved, the officer or employee shall refrain from participating in the City's business related to the matter. The City Manager, City Treasurer, and City employees may conduct personal business with banks, brokers, and other financial institutions that are authorized to conduct business with the City provided that the terms of the activity to the accountholder with the City are the same as those that are available to the public in general, or to all employees as a result of contract negotiations. IX. AUTHORIZED FINANCIAL DEALERS AND INSTITUTIONS The City Treasurer maintains a listing of financial institutions which are approved for direct investment purposes, as well as a list of approved broker/dealers. 1. Broker/Dealers who desire to become bidders for direct investment transactions must supply the City with the following: • Current audited financial statements; • Proof of Financial Industry Regulatory Authority (FINRA) Certification; • Proof of State of California registration; • Resume of Financial broker; and • Completion of the City of La Quinta Broker/Dealer questionnaire, which contains a certification of having read the City's Investment Policy. The City Treasurer shall evaluate the documentation submitted by the broker/dealer and independently verify existing reports on file for any firm and individual conducting investment related business. The City Treasurer will also contact the following agencies during the verification process: • Financial Industry Regulatory Authority (FINRA) Public Disclosure Report File (1-800- 289-9999). • State of California Department of Corporations (1-916-445-3062). A professional investment manager or management firm, if engaged by the City pursuant to Section X of this policy, may utilize their own list of approved broker/dealers on the condition that any such list is provided to the City upon request. All Broker/Dealers and financial institutions that provide investment services will be subject to City Council approval. An annual review of the financial condition and registrations of approved broker/dealers will be conducted by the City Treasurer or designee. Current audited financial statements and/or SSAE 16 internal control (SOC-1) reports will be maintained on file for each financial institution and broker/dealer with which the City conducts business. Each mutual fund shall provide a prospectus and statement of additional information. 2. Financial Institutions will be required to meet the following criteria in order to receive City funds for deposit or investment (see Appendix D, "Listing of Approved Financial Institutions"): • Insurance - Public Funds shall be deposited only in financial institutions having accounts insured by the Federal Deposit Insurance Corporation (FDIC). • Disclosure - Each financial institution maintaining invested funds in excess of the FDIC insured amount shall furnish the City a copy of the most recent Call Report. The City shall not invest in excess of the FDIC insured amount in banking institutions which do not disclose to the city a current listing of securities pledged for collateralization in public monies. X. PERMISSIBLE DEPOSITS AND INVESTMENTS It is the City’s policy to follow Title 5 of the California Government Code (the “State Code”) in regard to allowable securities, and to be sufficiently diversified with regard to security type and issuer. Permissible deposits and investments, as allowed by Chapter 4, Part 1, Division 2, Title 5 (hereinafter cited by §), include, but are not limited to, the following: Checking, Savings, and Sweep Accounts - The City will only maintain checking and savings, accounts with state or national banks, savings associations, federal associations, and/or credit unions in accordance with §53635.2. • Collateralization: The amount of the City's deposits or investments not insured by the FDIC shall be collateralized by securities in accordance with §53652. The Treasurer may invest in an interest-bearing active deposit account as approved in §53632. The deposit account must be collateralized with securities that are in accordance with §53632.5. In addition, the market value of the collateralized securities must be maintained in accordance with §53652 and be held by a custodian in accordance with the requirements of §53656. The proportion of the City's share of the deposit account shall be determined in accordance with §53658. Certificates of Deposit (Negotiable and Non-negotiable) – As authorized in §53601(i), the City may invest in Non- Negotiable and Negotiable Certificates of Deposits (CD) up to 30% of the overall portfolio. In no instance shall a CD or combined CD’s with a single issuer exceed the FDIC or NCUSIF insurance limit of $250,000. U.S. Treasury Bills, Notes, and Bonds – As authorized in §53601(b), the City may invest in U.S. Treasury bills, notes, and bonds directly issued and backed by the full faith and credit of the U.S. Government. The City's Investment Policy provides for investments in U.S. Treasury issues of 100% of the portfolio. U.S. Government Agency Securities and Federal Government Securities – As authorized in §53601(f), the City may invest in securities issued by U.S. Government instrumentalities and agencies (commonly referred to as government sponsored enterprises or GSE's). These securities may not be backed by the full faith and credit of the U.S. Government (with the exception of Government National Mortgage Association (GNMA) securities). Examples of GSE's include Federal National Mortgage Association (FNMA), Federal Home Loan Mortgage Corporation (FHLMC) Federal Home Loan Bank (FHLB), Federal Farm Credit Bank (FFCB), Federal Land Bank (FLB), Federal Intermediate Credit Bank (FICB), and GNMA securities. The City's Investment Policy allows investment only in securities of GNMA, FNMA, FHLMC, FHLB and FFCB. For Fiscal Year 2019-20, the maximum face amount per issuer is $20 million and the maximum face amount per purchase is $10 million. Prime Commercial Paper - As authorized in §53601(h), a portion of the City's portfolio may be invested in commercial paper of the highest rating as provided for by a nationally recognized statistical rating organization (NRSRO) such as Moody’s, Fitch, or Standard & Poor’s (S&P). There are a number of other qualifications regarding investments in commercial paper based on the financial strength of the corporation and the size of the investment. Up to 25% of the portfolio may be invested, with no more than 10% of the outstanding paper of any single issuer. Local Agency Investment Fund (LAIF) - As authorized in §16429.1 and by LAIF procedures, local government agencies are each authorized to invest a maximum of $65 million per account in this investment program administered by the California State Treasurer. The City Treasurer may not invest more than $65 million per account in LAIF. Money Market Mutual Funds - As authorized in §53601(l), local agencies are authorized to invest in shares of beneficial interest issued by diversified management companies (mutual funds) in an amount not to exceed 20% of the agency's portfolio. There are a number of other qualifications and restrictions regarding allowable investments in corporate notes and shares of beneficial interest issued by mutual funds which include (1) attaining the highest ranking or the highest letter and numerical rating provided by not less than two of the three largest nationally recognized rating services, or (2) having an investment advisor registered with the Securities and Exchange Commission with not less than five years' experience investing in the securities and obligations and with assets under management in excess of five hundred million dollars ($500,000,000). Corporate Notes - As authorized in §53601(k), local agencies may invest in corporate notes. The notes must be issued by corporations organized and operating in the United States or by depository institutions licensed by the United States or any other state and operating in the United States. The City's Investment Policy allows investment in corporate notes authorized by the Government Code with the following limitations: • Maximum 30% of the portfolio; • Maturities shall not exceed five years from date of purchase; • Eligible notes shall be regularly quoted and traded in the marketplace; • Eligible notes shall be in a rating category of "AA" or better by an NRSRO; • The maximum aggregate investment in each issuer shall not exceed $5 million (PAR value). Professionally Managed Account(s)- The City Treasurer may place up to 50% of the portfolio with a professional portfolio management/investment management firm (firm) The firm will be approved by the City Council based upon the City Treasurer's recommendation pursuant to completion of a public request for proposal (RFP). The firm shall have: • An established professional reputation for asset or investment management; • Knowledge and working familiarity with State and Federal laws governing and restricting the investment of public funds; • Substantial experience providing investment management services to local public agencies whose investment policies and portfolio size are similar to those of the City; • Professional liability (errors and omissions) insurance and fidelity bonding in such amounts as are required by the City; and • Registration with the Securities and Exchange Commission under the Investment Advisers Act of 1940 Before engagement by the City and except as may be specifically waived or revised, the firm shall commit to adhere to the provisions of the City's Investment Policy with the following exceptions: • The firm may be granted the discretion to purchase and sell investment securities in accordance with this Investment Policy; • The firm is not required to adhere to a buy-and-hold policy; and • The firm does not need City Manager or City Treasurer approval to make permissible investments. Local Agency Bonds and California Local Agency Obligations – As authorized in §53601(a) and §53601(e), the City may invest in California local agency obligations. §53601(a) pertains to investing in bonds issued by a local agency, or by the department, board, agency or authority of the local agency. §53601(e) pertains to investing in bonds and other defined indebtedness of any local agency, or department, board, agency or authority of the local agency within the State of California. The Agency obligations must be invested in the long-term rating category of A or better by an NRSRO. In the case of an initial public offering, including refinancings, the Treasurer may purchase directly from the Bond Underwriter. In the case of secondary issues, the Treasurer will rely on the approved Broker/Dealers. XI. INVESTMENT POOLS There are three (3) types of investment pools: • State-run pools (e.g., LAIF); • Pools that are operated by a political subdivision where allowed by law and the political subdivision is the trustee (e.g., County Pools, and Joint Powers Authorities such as the California Asset Management Program (CAMP)); and • Pools that are operated for profit by third parties (e.g. money market funds). The City's Investment Policy permits investment in pools and money market funds as authorized by State Code §16429.1, §53601(l) and §53601(p). XII. PAYMENT AND CUSTODY The City shall engage qualified third-party custodians to act in a fiduciary capacity to maintain appropriate evidence of the City's ownership of securities and other eligible investments. Such custodians shall disburse funds received from the City for a purchase, to the broker, dealer or seller only after receiving evidence that the City has legal, record ownership of the securities. Even though ownership is evidenced in book-entry form rather than by actual certificates, this procedure is commonly referred to as the delivery versus payment (DVP) method for the transfer of securities. XIII. INTEREST EARNING DISTRIBUTION POLICY Interest earnings are generated from pooled investments and specific investments. The following provisions apply to the calculation and distribution of interest earnings. 1. Pooled Investments - It is the general policy of the City to pool all available operating cash of the City of La Quinta, Successor Agency to the City of La Quinta Redevelopment Agency, La Quinta Financing Authority, and La Quinta Housing Authority, and to allocate interest earnings as a payment to each fund of an amount based on the month-end cash balance included in the common portfolio for the earning period. 2. Specific Investments - Specific investments purchased by a fund shall incur all earnings and expenses to that particular fund. XIV. INTERNAL CONTROLS AND INDEPENDENT AUDITOR The City Treasurer shall establish a system of internal controls to accomplish the following objectives: • Safeguard assets; • The orderly and efficient conduct of its business, including adherence to management policies; • Prevention or detection of errors and fraud; • The accuracy and completeness of accounting records; and • Timely preparation of reliable financial information. While no internal control system, however elaborate, can guarantee absolute assurance that the City's assets are safeguarded, it is the intent of the City's internal control to provide a reasonable assurance that management of the investment function meets the City's objectives. The internal controls shall address the following: • Control of collusion. Collusion is a situation where two or more employees are working in conjunction to defraud their employer. • Separation of transaction authority from accounting and record keeping. By separating the person who authorizes or performs the transaction from the people who record or otherwise account for the transaction, a separation of duties is achieved. • Custodial safekeeping. Securities purchased from any bank or dealer including appropriate collateral (as defined by State Law) shall be placed with an independent third party for custodial safekeeping. • Avoidance of physical delivery securities. Book entry securities are much easier to transfer and account for since actual delivery of a document never takes place. Delivered securities must be properly safeguarded against loss or destruction. The potential for fraud and loss increases with physically delivered securities. • Clear delegation of authority to subordinate staff members. Subordinate staff members must have a clear understanding of their authority and responsibilities to avoid improper actions. Clear delegation of authority also preserves the internal control structure that is contingent on the various staff positions and their respective responsibilities as outlined in the Segregation of Major Investment Responsibilities appendices. • Written confirmation of telephone transactions for investments and wire transfers. Due to the potential for error and improprieties arising from telephone transactions, all telephone transactions shall be supported by written communications or electronic confirmations and approved by the appropriate person. Written communications may be via fax or email if on letterhead and the safekeeping institution has a list of authorized signatures. Fax correspondence must be supported by evidence of verbal or written follow-up. • Development of a wire transfer agreement with the City's bank and third- party custodian. This agreement should outline the various controls, security provisions, and delineate responsibilities of each party making and receiving wire transfers. The system of internal controls developed by the City shall be reviewed annually by the independent auditor in connection with the annual audit of the City's Financial Statements. The independent auditor's letter on internal control over financial reporting and compliance as it pertains to cash and investments, if any, shall be directed to the City Manager who will direct the City Treasurer to provide a written response to the independent auditor's letter. The auditor's letter, as it pertains, to cash and investment activities and the City Treasurer's response shall be provided to the City's Financial Advisory Commission for their consideration. Following the completion of each annual audit, the independent auditor shall meet with the Financial Advisory Commission and discuss the auditing procedures performed and the review of internal controls for cash and investment activities. See Appendix C, "Segregation of Major Investment Responsibilities." XV. REPORTING STANDARDS The City Treasurer shall submit a quarterly Treasurers Report to the City Council and the Financial Advisory Commission that includes all cash and investments under the authority of the Treasurer. In addition, the City Treasurer or designee shall ensure investment transactions are reported as they occur throughout the quarter. The Treasurer's Report shall summarize cash and investment activity and changes in balances and include the following: • A certification by the City Treasurer; • A listing of purchases and sales/maturities of investments; • Cash and Investments categorized by authorized investments; LAIF will also be provided quarterly and show yield and maturity; • Comparison of month end actual holdings to Investment Policy limitations; • A two-year list of historical interest rates. XVI. REVIEW OF INVESTMENT PORTFOLIO The securities held by the City must be in compliance with this Policy at the time of purchase. Due to market conditions, some securities may no longer comply subsequent to the date of purchase, therefore an annual review of the portfolio will be conducted to identify any securities which may have fallen out of compliance. Any major incidences of noncompliance identified during such review will be reported to the Financial Advisory Commission for confirmation of staff recommendation regarding course of action. XVII. FINANCIAL ADVISORY COMMISSION - CITY OF LA QUINTA The Financial Advisory Commission (FAC) is composed of seven members from the public that are appointed by the City Council. The FAC’s membership, qualifications, and powers and duties are prescribed in Chapter 2.70 of the La Quinta Municipal Code and included in this policy as Appendix A. On an annual basis, in conjunction with the Political Reform Act disclosure statutes, or at any time if a change in circumstances warrants, each commissioner will provide the City Council with a disclosure statement which identifies any matters that have a bearing on the appropriateness of that member's service on the FAC. All commissioners shall report annually to the City Clerk on Form 700, Statement of Economic Interests, any activities, interests, or relationships that may be, or have the appearance of, a conflict of interest. XVIII. INVESTMENT POLICY ADOPTION The City's Investment Policy will be reviewed annually by the City's Financial Advisory Commission and the City Treasurer. The Financial Advisory Commission will forward the Investment Policy with any revisions to the City Manager and City Attorney for their review and comment. A joint meeting will be held with the Financial Advisory Commission, City Manager, City Attorney, and City Treasurer to review the Investment Policy and any comments prior to submission to the City Council for their consideration. The Investment Policy shall be adopted by resolution of the City Council annually before the end of June of each year. City of La Quinta Municipal Code Chapter 2.70 FINANCIAL ADVISORY COMMISSION 2.70.010 General rules regarding the financial advisory commission. Except as set out below, see Chapter 2.06 for general provisions. 2.70.020 Number of members. The financial advisory commission ("FAC") shall initially consist of seven members appointed by, and serving at the will of, the city council. The city council may increase or decrease the number of members from time to time but in no event shall the membership exceed nine members or be less than five members. 2.70.030 Qualifications of members. A. In addition to the qualification requirements set forth in Section 2.06.040 of this code, a minimum of three of the members shall be finance professionals and shall have a verifiable background in finance and/or securities, preferably with knowledge and/or experience in markets, financial controls and accounting for securities. B. For those applying for the professional position, background information will be requested, and potential candidates must agree to a background check and verification by the city manager or designee. 2.70.040 Powers and duties. A. The principal functions of the FAC are: 1. Review at least annually the city's investment policy and recommend appropriate changes; 2. Review at least quarterly the treasury report and note compliance with the investment policy and adequacy of cash and investments for anticipated obligations; 3. Receive and consider other reports provided by the city treasurer; 4. Meet with the independent auditor after completion of the annual audit of the city's financial statements, and receive and consider the auditor's comments on auditing procedures, internal controls, and findings for cash and investment activities; 5. Review at least annually the revenue derived from the one percent (1%) transactions and use tax instituted by voters in November 2016 to ensure these funds are used to provide services, programs and capital projects in the city of La Quinta. APPENDIX A 6. Serve as a resource for the city treasurer on matters such as proposed investments, internal controls, use of or change of financial institutions, custodians, brokers and dealers. B. The FAC will report to the city council after each meeting either in person or through correspondence at a regular city council meeting. (Ord. 556 § 1, 2017) 2.70.050 References to the Investment Advisory Board. If any other chapter(s) or section(s) in this code refers to the Investment Advisory Board, that chapter(s) or section(s) shall be deemed to refer to the Financial Advisory Commission established by the ordinance amending chapter 2.70 of this code City of La Quinta Municipal Code Chapter 3.08 INVESTMENT OF MONEYS AND FUNDS 3.08.010 Investment of city moneys and deposit of securities. Pursuant to, and in accordance with, and to the extent allowed by Sections 53607 and 53608 of the California Government Code, the authority to invest and reinvest moneys of the city, to sell or exchange securities, and to deposit them and provide for their safekeeping, is delegated to the city treasurer, which, for purposes of this chapter, is defined in Section 2.12.010 of this code. (Ord. 529 § 1, 2015; Ord. 2 § 1, 1982) 3.08.020 Authorized investments. Pursuant to the delegation of authority in Section 3.08.010, the city treasurer is authorized to purchase, at their original sale or after they have been issued, securities which are permissible investments under the city council adopted city investment policy and any provision of state law relating to the investing of general city funds, including, but not limited to, Sections 53601 and 53635 of the California Government Code, as said sections now read or may hereafter be amended, from moneys in the city treasurer's custody which are not required for the immediate necessities of the city and as he or she may deem wise and expedient, and to sell or exchange for other eligible securities and reinvest the proceeds of the securities so purchased. (Ord. 529 § 1, 2015; Ord. 2 § 1, 1982) 3.08.030 Sales of Securities. From time to time the city treasurer shall sell the securities in which city moneys have been invested pursuant to this chapter, so that the proceeds may, as appropriate, be applied to the purchase for which the original purchase money may have been designated or placed in the city treasury. (Ord.2 § 1 1982) 3.08.040 City bonds. Bonds issued by the city and purchased pursuant to this chapter may be cancelled either in satisfaction of sinking fund obligations or otherwise if proper and appropriate; provided, however, that the bonds may be held uncancelled and while so held may be resold. (Ord. 2 § 1 (part), 1982) 3.08.050 Reports. The city treasurer shall make a quarterly report to the city council of all investments made pursuant to the authority delegated in this chapter and as permitted by Section 53646(b)(1) of the Government Code. (Ord. 529 § 1, 2015; Ord. 2 § 1, 1982) 3.08.060 Deposits of securities. APPENDIX B Pursuant to the delegation of authority in Section 3.08.010, the city treasurer is authorized to deposit for safekeeping, the securities in which city moneys have been invested pursuant to this chapter, in any institution or depository authorized by the city council adopted investment policy and terms of any state law, including, but not limited to, Section 53608 of the Government Code, as it now reads or may hereafter be amended. In accordance with said section, the city treasurer shall take from the institution or depository a receipt for the securities so deposited and shall not be responsible for the securities delivered to and receipted for by the institution or depository until they are withdrawn therefrom by the city treasurer. (Ord. 529 § 1, 2015; Ord. 2 § 1, 1982) 3.08.070 Trust fund administration. Any departmental trust fund established by the city council pursuant to Section 36523 of the Government Code shall be administered by the city treasurer in accordance with Section 36523 and 36524 of the Government Code and any other applicable provisions of law. (Ord. 2 § 1, 1982) Function Responsible Parties Develop and recommend modifications to the City's formal Investment Policy City Treasurer, Financial Services Analyst, and Financial Advisory Commission Review City's Investment Policy and recommend City Council action City Manager and City Attorney Adopt formal Investment Policy City Council Implement formal Investment Policy City Treasurer Review financial institutions and select investments City Treasurer or Financial Servies Analyst Acknowledge investment selections City Manager or his/her designee Execute investment transactions City Manager, City Treasurer, or Financial Services Analyst Confirm wires Senior Accountant or Accountant Record investment transactions in City's accounting records Senior Accountant or Accountant Investment cerification- match broker confirmation to City's investment records City Treasurer or Financial Servies Analyst Reconcile investment records to accounting records and bank statements Financial Services Analyst Reconcile investment records to treasurer's report of investments Senior Accountant or Financial Services Analyst Security of investments at City Senior Accountant or Management Assistant Security of investments outside of City Third Party Custodian Review internal control procedures External Auditor SEGREGATION OF MAJOR INVESTMENT RESPONSIBILITIES APPENDIX C Banking Services (1)-Wells Fargo Bank, Government Services, Los Angeles, CA (Banking Services) -Bank of the West, San Francisco, CA (Banking Services) Custodian Services -The Bank of New York Mellon/Pershing LLC -Stifel Deferred Compensation -International City/County Management Association (ICCMA) Retirement Corporation Broker/Dealer Services(1)-Bank of America Securites/Merrill Lynch -Morgan Stanley -CitiGroup -Stifel, Nicholaus, & Company, Inc.(2) -Higgins Capital Management Inc. -Great Pacific Securities Government/Joint Powers Authority Pools -State of California Local Agency Investment Fund (LAIF) -California Asset Management Program (CAMP) Bond Trustee Services -US Bank (3)(1) Other Post Employment Benefits (OPEB) Trust -California Employers' Retirement Benefits Trust (CERBT)/CalPERS Pension Trust - Administration -Public Agency Retirement Services (PARS) Listing of Approved Financial Institutions (1) (3) US Bank is the fiscal agent for all of the following bonds: 1998 RDA Project Area 1&2; 2001 RDA Project Area 1; 2002 RDA Project Area 1; 2003 RDA Project Area 1; 2004 Local Agency Revenue; 2013, 2014, Successor Agency; and 2016 Successor Agency to the La Quinta RDA Bonds.Assessment Districts. US Bank is also the trustee and asset custodian for the PARS pension trust. (2) Stifel acquired the City’s former broker, First Empire Securities, in 2019 and the name change was approved by City Council in March 2019 (1) An RFI for broker/dealer services and an RFP for banking have been issued by the City in 2019. This list may change during the 2019/20 fiscal year, subject to FAC review and City Council approval APPENDIX D Investment Management Process and Risk Except as provided for in Section 27000.3, Government Code Section 53600.3 declares as a trustee each person, treasurer, or governing body authorized to make investment decisions on behalf of local agencies. Trustees are subject to the prudent investor standard. These persons shall act with care, skill, prudence, and diligence under the circumstances then prevailing when investing, reinvesting, purchasing, acquiring, exchanging, selling, and managing funds. Section 53600.5 further stipulates that the primary objective of any person investing public funds is to safeguard principal; secondly, to meet liquidity needs of the depositor; and lastly, to achieve a return or yield on invested funds (Government Code Section 27000.5 specifies the same objectives for county treasurers and board of supervisors). Risk is inherent throughout the investment process. There is investment risk associated with any investment activity and opportunity risk related to inactivity. Market risk is derived from exposure to overall changes in the general level of interest rates while credit risk is the risk of loss due to the failure of the insurer of a security. The market value of a security varies inversely with the level of interest rates. If an investor is required to sell an investment with a five percent yield in a comparable seven percent rate environment, that security will be sold at a loss. The magnitude of that loss will depend on the amount of time until maturity. Purchasing certain allowable securities with a maturity of greater than five years requires approval of the governing board (see Government Code Section 53601). Part of that approval process involves assessing and disclosing the risk and possible volatility of longer-term investments Another element of risk is liquidity risk. Instruments with call features or special structures, or those issued by little known companies, are examples of "story bonds" and are often thinly traded. Their uniqueness often makes finding prospective buyers in a secondary market more difficult and, consequently, the securities' marketability and price are discounted. However, under certain market conditions, gains are also possible with these types of securities. Default risk represents the possibility that the borrower may be unable to repay the obligation as scheduled. Generally, securities issued by the federal government and its agencies are considered the most secure, while securities issued by private corporations or negotiable certificates of deposit issued by commercial banks have a greater degree of risk. Securities with additional credit enhancements, such as bankers acceptances, collateralized repurchase agreements and collateralized bank deposits are somewhere between the two on the risk spectrum. APPENDIX E The vast majority of portfolios are managed within a buy and hold policy. Investments are purchased with the intent and capacity to hold that security until maturity. At times, market forces or operations may dictate swapping one security for another or selling a security before maturity. Continuous analysis and fine tuning of the investment portfolio are considered prudent investment management. The Government Code contains specific provisions regarding the types of investments and practices permitted after considering the broad requirement of preserving principal and maintaining liquidity before seeking yield. These provisions are intended to promote the use of reliable, diverse, and safe investment instruments to better ensure a prudently managed portfolio worthy of public trust. Source: Chapter II. Fund Management from the Local Agency Investment Guidelines Issued by California Debt and Investment Advisory Commission GLOSSARY (Adopted from the Municipal Treasurers Association) The purpose of this glossary is to provide the reader of the City of La Quinta investment policies with a better understanding of financial terms used in municipal investing. AGENCIES: Federal agency securities and/or Government-sponsored enterprises. ASKED: The price at which securities are offered. BANKERS' ACCEPTANCE (BA): A draft or bill or exchange accepted by a bank or trust company. The accepting institution guarantees payment of the bill, as well as the issuer. BID: The price offered by a buyer of securities. (When you are selling securities, you ask for a bid.) See Offer. BROKER: A broker brings buyers and sellers together for a commission. CERTIFICATE OF DEPOSIT (CD): A time deposit with a specific maturity evidenced by a certificate. Large- denomination CD's are typically negotiable. COLLATERAL: Securities, evidence of deposit or other property which a borrower pledges to secure repayment of a loan. Also refers to securities pledged by a bank to secure deposits of public monies. COMMERCIAL PAPER: Short-term unsecured promissory notes issued by a corporation to raise working capital. These negotiable instruments are purchased at a discount to par value or at par value with interest bearing. Commercial paper is issued by corporations such as General Motors Acceptance Corporation, IBM, Bank America, etc. COMPREHENSIVE ANNUAL FINANCIAL REPORT (CAFR): The official annual report for the City of La Quinta. It includes five combined statements for each individual fund and account group prepared in conformity with GAAP. It also includes supporting schedules necessary to demonstrate compliance with finance-related legal and contractual provisions, extensive introductory material, and a detailed Statistical Section. CONDUIT FINANCING: A form of Financing in which a government or a government agency lends its name to a bond issue, although it is acting only as a conduit between a specific project and bond holders. The bond holders can look only to the revenues from the project being financed for repayment and not to the government or agency whose name appears on the bond. COUPON: (a) The annual rate of interest that a bond's issuer promises to pay the bondholder on the bond's face value. (b) A certificate attached to a bond evidencing interest due on a payment date. APPENDIX F DEALER: A dealer, as opposed to a broker, acts as a principal in all transactions, buying and selling for his own account. DEBENTURE: A bond secured only by the general credit of the issuer. DELIVERY VERSUS PAYMENT: There are two methods of delivery of securities: delivery versus payment and delivery versus receipt. Delivery versus payment is delivery of securities with an exchange of money for the securities. Delivery versus receipt is delivery of securities with an exchange of a signed receipt for the securities. DERIVATIVES: (1) Financial instruments whose return profile is linked to, or derived from, the movement of one or more underlying index or security, and may include a leveraging factor, or (2) financial contracts based upon notional amounts whose value is derived from an underlying index or security (interest rates, foreign exchange rates, equities or commodities). DISCOUNT: The difference between the cost price of a security and its maturity when quoted at lower than face value. A security selling below original offering price shortly after sale also is considered to be at a discount. DISCOUNT SECURITIES: Non-interest-bearing money market instruments that are issued at discount and redeemed at maturity for full face value DIVERSIFICATION: Dividing investment funds among a variety of securities offering independent returns. FEDERAL CREDIT AGENCIES: Agencies of the Federal government set up to supply credit to various classes of institutions and individuals, e.g., S&L's, small business firms, students, farmers, farm cooperatives, and exporters. FNMAs (Federal National Mortgage Association) - Like GNMA was chartered under the Federal National Mortgage Association Act in 1938. FNMA is a federal corporation working under the auspices of the Department of Housing and Urban Development (HUD). It is the largest single provider of residential mortgage funds in the United States. Fannie Mae, as the corporation is called, is a private stockholder-owned corporation. The corporation's purchases include a variety of adjustable mortgages and second loans, in addition to fixed-rate mortgages. FNMA's securities are also highly liquid and are widely accepted. FNMA assumes and guarantees that all security holders will receive timely payment of principal and interest. FHLBs (Federal Home Loan Bank Notes and Bonds) - Issued by the Federal Home Loan Bank System to help finance the housing industry. The notes and bonds provide liquidity and home mortgage credit to savings and loan associations, mutual savings banks, cooperative banks, insurance companies, and mortgage-lending institutions. They are issued irregularly for various maturities. The minimum denomination is $5,000. The notes are issued with maturities of less than one year and interest is paid at maturity. FLBs (Federal Land Bank Bonds) - Long-term mortgage credit provided to farmers by Federal Land Banks. These bonds are issued at irregular times for various maturities ranging from a few months to ten years. The minimum denomination is $1,000. They carry semi- annual coupons. Interest is calculated on a 360-day, 30-day month basis. FFCBs (Federal Farm Credit Bank) – Debt instruments used to finance the short and intermediate term needs of farmers and the national agricultural industry. They are issued monthly with three- and six-month maturities. The FFCB issues larger issues (one to ten year) on a periodic basis. These issues are highly liquid. FICBs (Federal Intermediate Credit Bank Debentures) - Loans to lending institutions used to finance the short-term and intermediate needs of farmers, such as seasonal production. They are usually issued monthly in minimum denominations of $3,000 with a nine-month maturity. Interest is payable at maturity and is calculated on a 360-day, 30-day month basis. FHLMCs (Federal Home Loan Mortgage Corporation) - a government sponsored entity established in 1970 to provide a secondary market for conventional home mortgages. Mortgages are purchased solely from the Federal Home Loan Bank System member lending institutions whose deposits are insured by agencies of the United States Government. They are issued for various maturities and in minimum denominations of $10,000. Principal and interest is paid monthly. Other federal agency issues are Small Business Administration notes (SBA's), Government National Mortgage Association notes (GNMA's), and Tennessee Valley Authority notes (TVA's). FEDERAL DEPOSIT INSURANCE CORPORATION (FDIC): A federal agency that insures bank deposits, currently up to $250,000 per deposit per entity. FEDERAL FUNDS RATE: The rate of interest at which Fed funds are traded. This rate is currently pegged by the Federal Reserve through open- market operations. FEDERAL HOME LOAN BANKS (FHLB): Government sponsored wholesale banks (currently 12 regional banks) which lend funds and provide correspondent banking services to member commercial banks, thrift institutions, credit unions and insurance companies. The mission of the FHLBs is to liquefy the housing related assets of its members who must purchase stock in their district Bank. FEDERAL OPEN MARKET COMMITTEE (FOMC): Consists of seven members of the Federal Reserve Board and five of the twelve Federal Reserve Bank Presidents. The President of the New York Federal Reserve Bank is a permanent member, while the other Presidents serve on a rotating basis. The Committee periodically meets to set Federal Reserve guidelines regarding purchases and sales of Government Securities in the open market as a means of influencing the volume of bank credit and money. FEDERAL RESERVE SYSTEM: The central bank of the United States created by Congress and consisting of a seven-member Board of Governors in Washington, D.C., 12 regional banks and about 3,000 commercial banks that are members of the system. GOVERNMENT NATIONAL MORTGAGE ASSOCIATION (GNMA or Ginnie Mae): Securities influencing the volume of bank credit guaranteed by GNMA and issued by mortgage bankers, commercial banks, savings and loan associations, and other institutions. Security holder is protected by full faith and credit of the U.S. Government. Ginnie Mae securities are backed by the FHA, VA or FMHM mortgages. The term "pass- throughs" is often used to describe Ginnie Maes. LAIF (Local Agency Investment Fund): - A special fund in the State Treasury which local agencies may use to deposit funds for investment. There is no minimum investment period, the minimum transaction is $5,000 and the City follows the state guidance for maximum total balance. The City is restricted to a maximum of ten transactions per month. It offers high liquidity because deposits can be converted to cash in 24 hours and no interest is lost. All interest is distributed to those agencies participating on a proportionate share basis determined by the amounts deposited and the length of time they are deposited. Interest is paid quarterly. The State retains an amount for reasonable costs of making the investments, not to exceed one-half of one percent of the earnings. LIQUIDITY: A liquid asset is one that can be converted easily and rapidly into cash without a substantial loss of value. In the money market, a security is said to be liquid if the spread between bid and asked prices is narrow and reasonable size can be done at those quotes. LOCAL GOVERNMENT INVESTMENT POOL (LGIP): The aggregate of all funds from political subdivisions that are placed in the custody of the State Treasurer for investment and reinvestment MARKET VALUE: The price at which a security is trading and could presumably be purchased or sold. MASTER REPURCHASE AGREEMENT: A written contract covering all future transactions between the parties to repurchase--reverse repurchase agreements that establish each party's rights in the transactions. A master agreement will often specify, among other things, the right of the buyer- lender to liquidate the underlying securities in the event of default by the seller-borrower. MATURITY: The date upon which the principal or stated value of an investment becomes due and payable. MONEY MARKET: The market in which short-term debt instruments (bills, commercial paper, bankers' acceptances, etc.) are issued and traded. NRSRO (NATIONALLY RECOGNIZED STATISTICAL RATING ORGANIZATION): A credit rating agency recognized by the Securities and Exchange Commission (SEC). Examples include Fitch Ratings, Inc., Moody’s Investor’s Services, Inc., and S&P Global Ratings, among others. OFFER: The price asked by a seller of securities. (When you are buying securities, you ask for an offer.) See Asked and Bid. OPEN MARKET OPERATIONS: Purchases and sales of government and certain other securities in the open market by the New York Federal Reserve Bank as directed by the FOMC in order to influence the volume of money and credit in the economy. Purchases inject reserves into the bank system and stimulate growth of money and credit; sales have the opposite effect. Open market operations are the Federal Reserve's most important and most flexible monetary policy tool. PORTFOLIO: Collection of all cash and securities under the direction of the City Treasurer, including Bond Proceeds. PRIMARY DEALER: A group of government securities dealers who submit daily reports of market activity and positions and monthly financial statements to the Federal Reserve Bank of New York and are subject to its informal oversight. Primary dealers include Securities and Exchange Commission (SEC) registered securities broker- dealers, banks and a few unregulated firms. QUALIFIED PUBLIC DEPOSITORIES: A financial institution which does not claim exemption from the payment of any sales or compensating use or ad valorem taxes under the laws of this state, which has segregated for the benefit of the commission eligible collateral having a value of not less than its maximum liability and which has been approved by the Public Deposit Protection Commission to hold public deposits. RATE OF RETURN: The yield obtainable on a security based on its purchase price or its current market price. This may be the amortized yield to maturity on a bond the current income return. REPURCHASE AGREEMENT (RP OR REPO) and REVERSE REPURCHASE AGREEMENTS (RRP or RevRepo): A holder of securities sells these securities to an investor with an agreement to repurchase them at a fixed price on a fixed date. The security "buyer" in effect lends the "seller" money for the period of the agreement, and the terms of the agreement are structured to compensate him for this. Dealers use RP extensively to finance their positions. Exception: When the Fed is said to be doing RP, it is lending money that is increasing bank reserves. SAFEKEEPING: A service to customers rendered by banks for a fee whereby securities and valuables of all types and descriptions are held in the bank's vaults for protection. SECONDARY MARKET: A market made for the purchase and sale of outstanding issues following the initial distribution. SECURITIES & EXCHANGE COMMISSION: Agency created by Congress to protect investors in securities transactions by administering securities legislation. SEC RULE 15C3-1: See Uniform Net Capital Rule. SSAE 16: The Statement on Standards for Attestation Engagements No. 16 (SSAE 16) is a set of auditing standards and guidance on using the standards, published by the Auditing Standards Board (ASB) of the American Institute of Certified Public Accountants (AICPA) for redefining and updating how service companies report on compliance controls. The Service Organizational Control report (SOC-1) contains internal controls over financial reporting and is used by auditors and office controllers. STRUCTURED NOTES: Notes issued by Government Sponsored Enterprises (FHLB, FNMA, SLMA, etc.) and Corporations which have imbedded options (e.g., call features, step-up coupons, floating rate coupons, and derivative-based returns) into their debt structure. Their market performance is impacted by the fluctuation of interest rates, the volatility of the imbedded options and shifts in the shape of the yield curve. SURPLUS FUNDS: Section 53601 of the California Government Code defines surplus funds as any money not required for immediate necessities of the local agency. The City has defined immediate necessities to be payment due within one week. TREASURY BILLS: A non-interest- bearing discount security issued by the U.S. Treasury to finance the national debt. Most bills are issued to mature in three months, six months or one year. TREASURY BONDS: Long-term coupon-bearing U.S. Treasury securities issued as direct obligations of the U.S. Government and having initial maturities of more than 10 years. TREASURY NOTES: Medium-term coupon-bearing U.S. Treasury securities issued as direct obligations of the U.S. Government and having initial maturities from two to 10 years. UNIFORM NET CAPITAL RULE: Securities and Exchange Commission requirement that member firms as well as nonmember broker-dealers in securities maintain a maximum ratio of indebtedness to liquid capital of 15 to 1; also called net capital rule and net capital ratio. Indebtedness covers all money owed to a firm, including margin loans and commitments to purchase securities, one reason new public issues are spread among members of underwriting syndicates. Liquid capital includes cash and assets easily converted into cash. UNIFORM PRUDENT INVESTOR ACT: The State of California has adopted this Act. The Act contains the following sections: duty of care, diversification, review of assets, costs, compliance determinations, delegation of investments, terms of prudent investor rule, and application. YIELD: The rate of annual return on an investment, expressed as a percentage. (a) INCOME YIELD is obtained by dividing the current dollar income by the current market price for the security. (b) NET YIELD or YIELD TO MATURITY is the current income yield minus any premium above par or plus any discount from par in purchase price, with the adjustment spread over the period from the date of purchase to the date of maturity of the bond. City of La Quinta FINANCIAL ADVISORY COMMISSION MEETING: October 9, 2019 STAFF REPORT AGENDA TITLE: APPOINT TWO FINANCIAL ADVISORY COMMISSIONERS TO FORMULATE AND PREPARE THE ANNUAL MEASURE G SALES TAX OVERSIGHT COMPLIANCE REPORT RECOMMENDATION Appoint two Financial Advisory Commissioners to formulate, review, and prepare the annual Measure G Compliance Report. EXECUTIVE SUMMARY •Measure G, the one percent (1%) Transactions and Use Tax measure was approved by voters at the November 8, 2016 General Election and subsequently adopted by resolution on December 20, 2016 with an effective date of April 1, 2017. Additional funds are subject to citizen oversight. •Staff recommends the Financial Advisory Commission (FAC) appoint the two Commissioners to serve on the sub-committee to verify revenue and expenses associated with Measure G funds. •The sub-committee shall prepare a report and present their findings to City Council on November 19, 2019. BACKGROUND/ANALYSIS The Measure was approved on November 8, 2016 and adopted by resolution on December 20, 2016 with an effective date of April 1, 2017. Additional funds generated by the Measure are subject to citizen oversight. The verification of revenue and expenses will include the following: 1.A review of payments received during fiscal year 2018/19 2.A review of approved uses of funds for capital projects, reserves, and contract services 3.A review of proposed future uses 4.A review of current funds available for appropriation Starting in June 2016, Measure G funds have been received on a monthly basis. City staff recommends appointing two Commissioners on the sub- BUSINESS SESSION ITEM NO. 3 committee. Staff and the sub-committee shall present its report to the City Council on November 19, 2019. ALTERNATIVES Select up to three Commissioners to the sub-committee. Prepared by: Karla Romero, Finance Director City of La Quinta FINANCIAL ADVISORY COMMISSION MEETING: October 9, 2019 STAFF REPORT AGENDA TITLE: APPOINT UP TO THREE FINANCIAL ADVISORY COMMISSIONERS TO REVIEW THE 2019 UPDATE TO THE DEVELOPMENT IMPACT FEE STUDY RECOMMENDATION Appoint up to three Financial Advisory Commissioners to review the 2019 update to the Development Impact Fee Study. EXECUTIVE SUMMARY •Every five years the City is required to update the Development Impact Fee (DIF) Study (Study), which imposes one-time charges on development projects and are a major funding source for capital improvements. •City Council recommended the Financial Advisory Commission (FAC) serve on the sub-committee to review the Study and provide implementation recommendations. •The sub-committee shall prepare a summary report and present their findings to City Council on December 3, 2019. BACKGROUND/ANALYSIS On October 1, 2019 the City Council reviewed the Study during a study session and asked that the FAC create a subcommittee to review the Study and long- term financial impacts of its implementation. The subcommittee may be comprised of up to three commissioners. Staff anticipates up to four, four- hour in-person meetings during the next month. The subcommittee will prepare a summary report by November 22, 2019 which will be presented to City Council on December 3, 2019. The review will include the following: Day 1 – Review of Study and City Council meeting on 10/1/19 Day 2 – Review of 10-year projections for General Fund and all DIF Funds, capital improvement plan and identified unfunded projects, and write-off of DIF loans in 18/19. Day 3 – Review Desert Valley Builders Association and Building Industry Association comments and City responses, as well as recent and historical building industry trends. BUSINESS SESSION ITEM NO. 4 Day 4 – Finalize review and prepare draft report. Attachment 1 is the staff report and Study presented to City Council on 10/1/19. ALTERNATIVES Staff does not recommend any alternatives. Prepared by: Karla Romero, Finance Director Attachment 1: 10/1/19 City Council staff report – 2019 Update of the Development Impact Fee Study City of La Quinta CITY COUNCIL MEETING: October 1, 2019 STAFF REPORT AGENDA TITLE: DISCUSS 2019 UPDATE OF THE DEVELOPMENT IMPACT FEE STUDY RECOMMENDATION Discuss 2019 update of the Development Impact Fee study. EXECUTIVE SUMMARY •Development impact fees (DIF) are one-time charges imposed on development projects to recover capital costs for public facilities needed to serve those new developments and the additional residents, employees, and visitors they bring to the community. •In the past, these fees have been one of the major funding sources for the City’s Capital Improvement Program (CIP). •The City must update the DIF periodically in order to comply with state law. •The 2019 update is the sixth update to the 1999 DIF and is intended to satisfy the requirements of the Mitigation Fee Act (Government Code sections 66000 et seq.) commonly known as “AB1600”. •The DIF draft report was provided to the Desert Valley Builders Association (DVBA) and Building Industry Association (BIA) on August 27, 2019 for review and comment. FISCAL IMPACT The recommended DIF schedule will generate approximately $81,492,532, assuming that all development anticipated in the City General Plan occurs. The following presents the projected impact fee revenue by facility type: FACILITY TYPE PROJECTED REVENUE Parks $13,878,869 Community and Cultural Centers $6,299,893 Library $2,615,154 Civic Center $9,932,414 Maintenance Facilities $2,997,432 STUDY SESSION ITEM NO. 2 221 ATTACHMENT 1 Fire Protection $2,957,885 Transportation $42,810,885 TOTAL $81,492,532 The DIF represents the maximum Impact Fee amount justified by the analysis. The Council may choose to adopt fees lower than those recommended; however alternative funding sources would eventually need to be identified in order to complete these facilities. It should be emphasized that all costs used in this report are in current dollars. In the past, the Council discounted transportation impact fees by 22%. The Fees presented within the September 2019 update do not automatically include this discount. The following represents the proposed fees by land use category: The following compares the proposed fees to the existing fees: BACKGROUND/ANALYSIS In 1989, a California statute took effect, which governs the establishment, increase and imposition of fees levied by local agencies as a condition of development project approval “for the purpose of defraying all or a portion of the cost of public facilities related to this development project.” Public facilities are defined in this statute to include “public improvements, public services, and community amenities.” These requirements are found in the Mitigation Fee Act (Government Code Section 66000 et seq.) and are commonly known as “AB1600" requirements after the 1987 assembly bill in which they originated. Ch.3 Ch.4 Ch.5 Ch.6 Ch.7 Ch.8 Ch.9 Development Dev Park Comm/Civic Maint 2 Trans-Grand Type Unit 1 Imprvmts Cultural Library Center Facilities Fire portation Total Residential - Single Family Detached DU 2,106$ 956$ 397$ 1,230$ 313$ 369$ 4,009$ 9,380$ Residential - Single Family Attached DU 1,794$ 814$ 338$ 1,115$ 247$ 335$ 3,076$ 7,719$ Residential - Multi-Family/Other DU 1,716$ 779$ 323$ 628$ 198$ 188$ 2,281$ 6,114$ Office/Medical KSF 522$ 374$ 151$ 6,542$ 7,589$ General Commercial KSF 522$ 461$ 151$ 8,057$ 9,190$ Tourist Commercial/Lodging Room 698$ 106$ 201$ 1,859$ 2,865$ Golf Course Acre 251$ 53$ 72$ 930$ 1,306$ Development Dev Proposed Current Increase Percent Type Unit Fees Fees Amount Change Residential - Single Family Detached DU 9,380$ 6,894$ 2,486$ 27% Residential - Single Family Attached DU 7,719$ 6,681$ 1,038$ 13% Residential - Multi-Family/Other DU 6,114$ 5,030$ 1,084$ 18% Office/Medical KSF 7,589$ 5,379$ 2,210$ 29% General Commercial KSF 9,190$ 6,456$ 2,734$ 30% Tourist Commercial/Lodging Room 2,865$ 2,185$ 680$ 24% Golf Course Acre 1,306$ 957$ 349$ 27% 222 The US Supreme Court has found that an agency imposing exactions on development must demonstrate an “essential nexus” between such an exaction and the government’s legitimate interest. The court made clear that an agency must also show that an exaction is “roughly proportional” to the burden created by development. California law does not limit the type of capital improvements for which impact fees can be charged. However, with a few minor exceptions, it does prohibit the use of impact fees for ongoing maintenance or operation costs (see Government Code Section 65913.8). Consequently, the fees recommended on this report are based on capital costs only. City staff provided the updated DIF draft report to Desert Valley Builders Association (DVBA) and Building Industry Association (BIA) on August 27, 2019. Staff met with both the DVBA and BIA to review comments. Any additional comments may be presented to the Council during its Study Session on October 1, 2019. Presented for the Council’s consideration is the Sixth update of the DIF Study, dated September 23, 2019 (Attachment 1). Attachment 2 provides a brief overview of the changes presented within the 2019 DIF Update. As with the previous report, Section 1 provides an overview of impact fees. It sets forth legal requirements for establishing and imposing such fees as well as methods used in this study to calculate the fees. Section 2 contains information on existing and planned uses and development in La Quinta and organizes that data in a form that can be used in the DIF analysis. Sections 3 through 9 analyze the impacts of development on specific types of facilities. Those sections identify facilities eligible for impact fee funding and calculate recommended impact fees for each type of facility. Section 10 discusses procedures and legal requirements for implementing an impact free program under California law. Section 10 also addresses adoption, administration, and training. The types of public facilities covered by the DIF are: Chapter 3. Parks and Recreation Impact Fees Chapter 4. Community and Cultural Centers Chapter 5. Library Facilities and Materials Chapter 6. Civic Center Facilities Chapter 7. Maintenance Facilities and Equipment Chapter 8. Fire Protection Facilities Chapter 9. Transportation Facilities Prepared by: Julie Mignogna, Management Analyst Approved by: Bryan McKinney, PE, City Engineer Attachments: 1.Draft 2019 Development Impact Fee Study 2. 2019 DIF Study Overview 223 224 City of La Quinta Development Impact Fee Study August 8, 2019 CITY OF LA QUINTA Revised Final DRAFT Report Development Impact Fee Study September 23, 2019 nbsgov.com Prepared by: Corporate Headquarters 32605 Temecula Parkway, Suite 100 Temecula, CA 92592 Toll free: 800.676.7516 ATTACHMENT 1 225 City of La Quinta Development Impact Fee Study August 8, 2019 Table of Contents Chapter 0. Executive Summary ........................................................................................................S-1 Organization of the Report ....................................................................................................................S-1 Development Projections ......................................................................................................................S-1 Impact Fee Analysis................................................................................................................................S-2 Recovery of Study Costs .........................................................................................................................S-5 Impact Fee Summary .............................................................................................................................S-5 Chapter 1. Introduction ...................................................................................................................1-1 Purpose ..................................................................................................................................................1-1 Legal Framework for Developer Fees ....................................................................................................1-1 Impact Fee Calculation Methodology ....................................................................................................1-6 Facilities Addressed in this Study ...........................................................................................................1-8 Chapter 2. Development Data .........................................................................................................2-1 Background and Setting .........................................................................................................................2-1 Study Area and Development Scenario .................................................................................................2-1 Time Frame ............................................................................................................................................2-1 Development Types ...............................................................................................................................2-2 Residential Development and Population .............................................................................................2-2 Non-Residential Development ...............................................................................................................2-3 Demand Variables ..................................................................................................................................2-3 Demand Factors .....................................................................................................................................2-5 Existing and Forecasted Development ..................................................................................................2-5 Chapter 3. Parks and Recreation Impact Fees ...................................................................................3-1 Demand Variable ...................................................................................................................................3-1 Service Area ...........................................................................................................................................3-1 Existing Facilities ....................................................................................................................................3-1 Quimby Act Fees in Lieu of Park Land Dedication .................................................................................3-2 Methodology and Level of Service Standard –Quimby Act ..................................................................3-3 Fees In-Lieu of Park Land Dedication –Quimby Act ..............................................................................3-3 Park Impact Fees ....................................................................................................................................3-5 Methodology-Park Impact Fees ............................................................................................................3-5 226 City of La Quinta Development Impact Fee Study August 8, 2019 Level of Service Standard –Park Impact Fees........................................................................................3-5 Cost Per Capita –Park Impact Fees .......................................................................................................3-5 Park Land Acquisition Impact Fees per Unit ..........................................................................................3-6 Park Improvement Impact Fees per Unit ...............................................................................................3-7 Projected Revenue .................................................................................................................................3-7 Updating the Fees ..................................................................................................................................3-8 Nexus Summary .....................................................................................................................................3-8 Chapter 4. Community and Cultural Centers ....................................................................................4-1 Methodology..........................................................................................................................................4-1 Demand Variable ...................................................................................................................................4-1 Service Area ...........................................................................................................................................4-1 Level of Service ......................................................................................................................................4-1 Existing Facilities ....................................................................................................................................4-2 Cost per Capita .......................................................................................................................................4-2 Impact Fees per Unit of Development ...................................................................................................4-3 Projected Revenue .................................................................................................................................4-3 Updating the Fees ..................................................................................................................................4-4 Nexus Summary .....................................................................................................................................4-4 Chapter 5. Library ...........................................................................................................................5-1 Methodology..........................................................................................................................................5-1 Demand Variable ...................................................................................................................................5-1 Service Area ...........................................................................................................................................5-1 Level of Service ......................................................................................................................................5-1 Existing Facilities ....................................................................................................................................5-1 Cost per Capita .......................................................................................................................................5-2 Impact Fees per Unit of Development ...................................................................................................5-2 Projected Revenue .................................................................................................................................5-3 Updating the Fees ..................................................................................................................................5-4 Nexus Summary .....................................................................................................................................5-4 Chapter 6. Civic Center ....................................................................................................................6-1 Methodology..........................................................................................................................................6-1 Demand Variable ...................................................................................................................................6-1 227 City of La Quinta Development Impact Fee Study August 8, 2019 Service Area ...........................................................................................................................................6-1 Level of Service ......................................................................................................................................6-2 Existing Facilities ....................................................................................................................................6-2 Cost per Developed Acre .......................................................................................................................6-2 Impact Fees per Unit of Development ...................................................................................................6-3 Projected Revenue .................................................................................................................................6-3 Updating the Fees ..................................................................................................................................6-4 Nexus Summary .....................................................................................................................................6-4 Chapter 7. Maintenance Facilities ....................................................................................................7-1 Methodology..........................................................................................................................................7-1 Demand Variable ...................................................................................................................................7-1 Service Area ...........................................................................................................................................7-1 Level of Service ......................................................................................................................................7-1 Facility Needs .........................................................................................................................................7-2 Park Maintenance Facilities Cost per Capita.........................................................................................7-3 Street Maintenance Facilities Cost per Weighted Peak Hour Trip........................................................7-3 Impact Fees per Unit of Development –Park Maintenance Facilities...................................................7-4 Impact Fees per Unit of Development –Street Maintenance Facilities ................................................7-5 Park Maintenance Facilities Impact Fees -Projected Revenue .............................................................7-7 Street Maintenance Facilities Impact Fees -Projected Revenue ..........................................................7-7 Updating the Fees ..................................................................................................................................7-8 Nexus Summary .....................................................................................................................................7-8 Chapter 8. Fire Protection ...............................................................................................................8-1 Methodology..........................................................................................................................................8-1 Service Area ...........................................................................................................................................8-1 Level of Service ......................................................................................................................................8-2 Demand Variable ...................................................................................................................................8-2 Facility Needs .........................................................................................................................................8-2 Cost per Developed Acre .......................................................................................................................8-3 Impact Fees per Unit of Development ...................................................................................................8-4 Projected Revenue .................................................................................................................................8-6 Updating the Fees ..................................................................................................................................8-7 228 City of La Quinta Development Impact Fee Study August 8, 2019 Nexus Summary .....................................................................................................................................8-7 Chapter 9. Transportation ...............................................................................................................9-1 Methodology..........................................................................................................................................9-1 Service Area ...........................................................................................................................................9-1 Level of Service ......................................................................................................................................9-1 Demand Variable ...................................................................................................................................9-1 Improvement Needs ..............................................................................................................................9-2 Cost per Weighted Peak Hour Trip ........................................................................................................9-2 Impact Fees per Unit of Development ...................................................................................................9-3 Projected Revenue .................................................................................................................................9-5 Updating the Fees ..................................................................................................................................9-6 Nexus Summary .....................................................................................................................................9-6 Chapter 10. Implementation .........................................................................................................10-1 Adoption ..............................................................................................................................................10-1 Administration .....................................................................................................................................10-2 Training and Public Information ..........................................................................................................10-7 Recovery of Study Costs and Administrative Costs .............................................................................10-7 229 City of La Quinta Page S-1 Development Impact Fee Study September 23, 2019 Chapter 0.Executive Summary The City of La Quinta has retained NBS Government Finance Group to prepare this study to analyze the impacts of new development on the City’s capital facilities and infrastructure and to calculate impact fees based on that analysis.The methods used in this study are intended to satisfy all legal requirements of the U. S. Constitution,the California Constitution and the California Mitigation Fee Act (Gov ernment Code Sections 66000 et seq.)and The Quimby Act (Government Code Section 66477) where it applies. Organization of the Report Chapter 1 of this report provide s an overview of the legal requirements for establishing and imposing such fees,and methods that can be used to calculate impact fees. Chapter 2 contains data on existing and future development that is used in this report . Chapters 3 through 9 analyze the impacts of development on specific types of facilities and calculate impact fees for those facilities.The facilities addressed in this report are listed by chapter below: Chapter 3. Parks and Recreation Impact Fees Chapter 4.Community and Cultural Centers Chapter 5.Library Facilities and Materials Chapter 6.Civic Center Facilities Chapter 7.Maintenance Facilities Chapter 8.Fire Protection Facilities Chapter 9.Transportation Facilities Chapter 10 contains recommendations for adopting and implement ing impact fees, including suggested findings to satisfy the requirements of the Mitigation Fee Act. Development Projections Chapter 2 of this report presents estimates of existing development in La Quinta and projections of future development through buildout of the area with the existing corporate boundaries of the City.Because the City’s population fluctuates seasonally, this study uses “potential population” in the impact fee analysis. Potential popul ation is based on full- occupancy of all dwelling units in the City as any given time. Future development projected in Chapter 2 indicates that the City’s potential population could increase by about 28% to 82,300, as undeveloped residential land within the City’s existing boundaries is built out. The impact fees calculated in this report are in current dollars and do not require assumptions about the rate or timing of future development. However, based on the City’s population 230 City of La Quinta Page S-2 Development Impact Fee Study September 23, 2019 growth rate over the last several years, it could take 25 years to absorb the land available for residential development within the existing boundaries of the City. Impact Fee Analysis The impact fee analysis for each type of facility addressed in this report is presented in a separate chapter. In each case, the relationship between development and the need for a particular type of facility is defined in a way that allows the impact of additional development on facility needs to be quantified. The impact fees are based on the cost of facilities and other capital assets needed to mitigate the impacts of additional development . All of the fees calculated in this report are based on capital costs and may be spent only for capital facilities and other capital assets identified in this report. The following paragraphs briefly discuss the approach used to calculate impact fees for each type of facility addressed in this study. Tables summarizing the impact fees calculated in this report and comparing them with the City’s existing impact fees are presented later in this chapter. Park and Recreation Impact Fees.Chapter 3 of this report calculates three types of fees for park land acquisition and park improvements: Quimby Act fees in lieu of park land dedication for residential subdivisions Park land acquisition impact fees for residential d evelopment not involving a subdivision Park improvement impact fees for all residential developme nt The City currently has an ordinance requiring residential subdivisions to dedicate land for parks or pay fees in lieu of dedication . Those requirements are authorized by the Quimby Act.At present, when the City collects fees in lieu of park land dedication, the amount of the fee is based on the value of the land under the subdivision.An alternative employed by many cities is to base in-lieu fees on the estimated average cost-per-acre for park land purchased on the open market. Chapter 3 shows the amount of in-lieu fees calculated in that manner. Chapter 3 also calculates park land impact fees for residential development that does not involve a subdivision.Those fees are based on the City’s existing ratio of park acres to population and the estimated cost-per-acre for park land In addition, Chapter 3 calculates impact fees for park and recreation improvements. Those fees are based on La Quinta’s existing rat io of improved park acreage to population and the estimated cost per acre for park improvements. All of the in-lieu and impact fees in Chapter 3 are calculated as a cost per capita and then converted into fees per unit of residential development based on the estimated average 231 City of La Quinta Page S-3 Development Impact Fee Study September 23, 2019 population per unit for the three types of residential devel opment defined in this report (Single Family Detached, Single-Family Attached, and Multi -Family-Other). Because parks and recreation facilities are intended to serve resident s of the City,the park and recreation in-lieu and impact fees apply only to residential development. Community and Cultural Centers Impact Fee.Chapter 4 calculates impact fees for community and cultural centers.Up to now, this fee has been called the Community Centers Impact Fee and was based on only portions of certain City-owned facilities such as the La Quinta Museum and the Boys and Girls Club, in addition to the Wellness Center. In this study, the basis for this fee has been broadened to include the Wellness Center,the entire Museum and the Boys and Girls Club building,as well as land acquired for the Village Art Plaza and Promenade . The amount of the fee is based on the value of the City’s current per-capita investment in the relevant facilities,including land and furniture, fixtures and equipment.The community and cultural centers impact fees are calculated as a cost per capita and then converted into fees per unit of residential development based on the estimated average population per unit fo r the three types of residential development defined in this report. Because community and cultural center facilities are intended to serve residents of the City,this fee applies only to residential development . Library Impact Fee. Chapter 5 calculates impact fees for the library.The calculation of this fee assumes that the existing La Quinta Branch Library has adequate capacity to serve all existing and future residential development within the existing corporate boundaries of the City. This fee is calculated by allocating the cost of the Library building,land,library materials and furniture fixtures and equipment to the projected buildout population of the area within the existing City limits.The building cost is defined as the original cost of the b uilding plus nominal interest to date on the outstanding loan originally issued by the Redevelopment Agency to fund construction of the library. The impact fees are calculated as a cost per capita and then converted into fees per unit of residential development based on the estimated average population per unit for the three types of residential development defined in this report. Because the library is intended primarily to serve residents of the City, this fee applies only to residential development. Civic Center Impact Fee.Chapter 6 calculates impact fees for the civic center. The calculation of this fee is based on the relationship between the cost of the existing Civic Center and existing developed acreage within the City. This fee is calculated by allocating the cost of the Civic Center building, land,and furniture fixtures and equipment to existing development within the existing City limits based on developed acreage.The building cost is defined as the original cost of the building. 232 City of La Quinta Page S-4 Development Impact Fee Study September 23, 2019 The civic center impact fees are calculated as a cost per developed acre and then converted into fees per unit of development based on the estimated average acres per unit for each type of development defined in this report. The Civic Center impact fees apply to all t ypes of private development in the City. Public facilities, schools, and parks are excluded from the impact fee analysis because they do not create a demand for services supported by the Civic Center.The Civic Center impact fee applies to golf courses, but only 5% of golf course acreage is assumed to impact services supported by the Civic Center. Maintenance Facilities Impact Fee.Chapter 7 calculates impact fees for corporate yard maintenance facilities, including some major equipment .The calculation of this fee allocates costs for both existing and future maintenance facilities to all existing and future development within the existing corporate bounda ries of the City at buildout.Costs for future improvements to the City’s maintenance facilitie s are based on estimates for Phase II and Phase III of the planned Corporate Yard improvements. To calculate this fee, the City’s maintenance facilities are broken into two components —park maintenance facilities and street maintenance facilities. Costs fo r park maintenance facilities are allocated to development in the same manners as parks, based on population. Costs for street maintenance facilities are allocated to development in the same manner as transportation improvements, based on weighted peak hou r trips. In the initial impact fee analysis for street maintenance facilities, impact fees are calculated for public facilities, schools and parks because they do generate some traffic. However, because the traffic created by those public uses is a seconda ry impact of private development, the costs initially allocated to those uses are re -allocated to private development, resulting in a small increase in the fees for all types of private development. The maintenance facilities impact fees apply to all types of private development in the City. Fire Protection Impact Fee.Chapter 8 calculates impact fees for fire protection facilities. The calculation of this fee allocates the cost of both existing and future fire protection facilities to all existing and future development within the existing corporate boundaries of the City at buildout. This study assumes that the City of La Quinta will be responsible for one -half of the cost of a fourth fire station in the Southeastern quadrant of the City. To calculate this fee,costs for fire protection facilities are allocated to development based on developed acreage.In the initial impact fee analysis for fire protection facilities, impact fees are calculated for public facilities, schools and parks based on the acreage they occupy. However, because the need for those public uses is created by private development, the costs initially allocated to those uses are re-allocated to private development, resulting in a small increase in the fees for all types of private development. The fire protection facilities impact fees apply to all types of private development in the City. 233 City of La Quinta Page S-5 Development Impact Fee Study September 23, 2019 Transportation Impact Fee.Chapter 9 of this report calculates impact fees for transportation improvements.For purposes of the impact fee analysis, transpor tation improvements are divided into two groups: those that increase capacity for vehicular traffic and others such as sidewalks and bike lanes.Costs for capacity-capacity-enhancing improvements are allocated only to future development. Costs for non -capacity-enhancing improvements are allocated to both existing and future development.Both groups include costs to repay remaining balance s on reimbursement agreements. To calculate this fee, costs for all types of transportation improvements are allocated to development based on the number of weighted peak hour trips generated by various types of development. Weighted peak hour trips reflect both the number of trips generated and trip length for various types of development. In the initial impact fee analysis for transportation facilities, impact fees are calculated for public facilities, schools and parks based on the number of weighted pea k hour trips they generate. However, because the need for those public uses is created by private development, the costs initially allocated to those uses are re-allocated to private development, resulting in a small increase in the fees for all types of p rivate development. The transportation facilities impact fees apply to all types of private development in the City. Recovery of Study Costs In this report, the impact fee calculations include a small administrative charge designed to recover the cost of this study. That charge amounts to about 1/3 of 1% of the impact fees. Impact Fee Summary Impact fees per unit calculated in this report are summarized in Table S.1, below. Table S.1: Summary of Impact Fees Calculated in This Study Ch.3 Ch.4 Ch.5 Ch.6 Ch.7 Ch.8 Ch.9 Development Dev Park Comm/Civic Maint 2 Trans-Grand Type Unit 1 Imprvmts Cultural Library Center Facilities Fire portation Total Residential - Single Family Detached DU 2,106$956$397$1,230$313$369$4,009$9,380$ Residential - Single Family Attached DU 1,794$814$338$1,115$247$335$3,076$7,718$ Residential - Multi-Family/Other DU 1,716$779$323$628$198$188$2,281$6,114$ Office/Medical KSF 522$374$151$6,542$7,589$ General Commercial KSF 522$461$151$8,057$9,191$ Tourist Commercial/Lodging Room 698$106$201$1,859$2,865$ Golf Course Acre 251$53$72$930$1,306$ Note: Rows may not total precisely due to rounding 1 Units of development; DU = dwelling unit; KSF = 1,000 square feet of building floor area; Room = hotel/motel guest room or suite acre = net acre 2 Fee for maintenance facilities includes both park maintenance and street maintenance 234 City of La Quinta Page S-6 Development Impact Fee Study September 23, 2019 Table S.2 shows the City’s existing impact fees.It is important to note that the existing impact fees for transportation improvements were reduced 22%from the amounts that were supported by improvement costs in the City’s 2013 impact fee study. Table S.3 shows the difference between the proposed fees in Table S.1 and the existing fees in Table S.2. Table S.2 Summary of Existing Impact Fees Development Dev Park Comm/Civic Maint 2 Transpor-Grand Type Unit 1 Imprvmts Cultural Library Center Facilities Fire tation 3 Total Residential - Single Family Detached DU 2,048$129$344$942$156$433$2,842$6,894$ Residential - Single Family Attached DU 2,048$129$344$796$156$366$2,842$6,681$ Residential - Multi-Family/Other DU 2,048$129$344$447$111$206$1,745$5,030$ Office/Medical KSF 373$190$171$4,645$5,379$ General Commercial KSF 373$232$172$5,679$6,456$ Tourist Commercial/Lodging Room 363$65$167$1,590$2,185$ Golf Course Acre 179$27$82$669$957$ 1 Units of development; DU = dwelling unit; KSF = 1,000 square feet of building floor area; Room = hotel/motel guest room or suite acre = net acre 2 Impact fees for maintenance facilities include both park maintenance and street maintenance 3 Existing impact fees for transportation improvements were discounted 22% from actual costs Table S.3 Difference Between Existing and Proposed Impact Fees Development Dev Park Comm/Civic Maint 2 Transpor-Grand Type Unit 1 Imprvmts Cultural Library Center Facilities Fire tation 3 Total Residential - Single Family Detached DU 58$827$53$288$157$(64)$1,167$2,486$ Residential - Single Family Attached DU (254)$685$(6)$319$91$(31)$234$1,037$ Residential - Multi-Family/Other DU (332)$650$(21)$181$87$(18)$536$1,084$ Office/Medical KSF 149$184$(20)$1,897$2,210$ General Commercial KSF 149$229$(21)$2,378$2,735$ Tourist Commercial/Lodging Room 335$41$34$269$680$ Golf Course Acre 72$26$(10)$261$349$ 1 Units of development; DU = dwelling unit; KSF = 1,000 square feet of building floor area; Room = hotel/motel guest room or suite acre = net acre 2 Impact fees for maintenance facilities include both park maintenance and street maintenance 3 Existing impact fees for transportation improvements were discounted 22% from actual costs 235 City of La Quinta Page 1-1 Development Impact Fee Study August 8, 2019 Chapter 1.Introduction Purpose The purpose of this study is to analyze the impacts of development on the need for types of public facilities provided by the City of La Quinta. This report documents the approach, data and methodology used in the analysis of impact fees and Quimby Act park land dedication requirements and in lieu fees. The methods used to calculate impact fees and in-lieu fees in this report are intended to satisfy all legal requirements governing such fees, including provisions of the U. S. Constitution, the California Constitution, the California Mitigation Fee Act (Government Code Section s 66000- 66025), and, where applicable,the Quimby Act (Government Code Section 66477). Legal Framework for Developer Fees This brief summary of the legal framework for development fees is intended as a general overview.It was not prepared by an attorney,and should not be treated as legal advice. U. S. Constitution.Like all land use regulations, development exactions, including impact fees, are subject to the 5th Amendment prohibition on taking of private property for public use without just compensation . Both state and federal courts have recognized the impo sition of impact fees on development as a legitimate form of land use regulation, provided the fees meet standards intended to protect against “regulatory takings.” A regulatory taking occurs when regulations unreasonably deprive landowners of property rights protected by the Constitution. In two landmark cases dealing with exactions, the U. S. Supreme Court has held that when a government agency requires the dedication of land or an interest in la nd as a condition of development approval, or imposes ad hoc exactions as a condition of approval on a single development project that do not apply to development generally, a higher standard of judicial scrutiny applies. To meet that standard, the agency must demonstrate an "essential nexus" between such exactions and the interest being protected (See Nollan v. California Coastal Commission,1987) and make an” individualized determination” that the exaction imposed is "roughly proportional" to the burden c reated by development (See Dolan v. City of Tigard, 1994). Until recently, it was widely accepted that legislatively -enacted impact fees that apply to all development in a jurisdiction are not subject to the higher standard of judicial scrutiny flowing from the Nollan and Dolan decisions. But after the U. S. Su preme Court decision in Koontz v. St. Johns Water Management District (2013),state courts have reached conflicting conclusions on that issue. In light of that uncertainty, any agency enacting or im posing impact fees would be wise to demonstrate a nexus and ensure proportionality in the calculation of those fees. 236 City of La Quinta Page 1-2 Development Impact Fee Study August 8, 2019 Defining the “Nexus.”While courts have not been entirely consistent in defining the nexus required to justify exactions and impact fees,that term can be thought of as having the three elements discussed below. We think proportionality is logically included as one element of that nexus, even though it was discussed separately in Dolan v. Tigard.The elements of the nexus discussed below mirror the three “reasonable relationship” findings requir ed by the Mitigation Fee Act for establishment and imposition of impact fees. Need or Impact.Development must create a need for the facilities to be funded by impact fees. All new development in a community creates additional demands on some or all public facilities provided by local government. If the capacity of facilities is not increased to satisfy the additional demand, the quality or availability of public services for the entire community wil l deteriorate. Impact fees may be used to recover the cost of development -related facilities, but only to the extent that the need for facilities is related to the development project subject to the fees. The Nollan decision reinforced the principle that development exactions may be used only to mitigate impacts created by the development projects upon which they are imposed. In this study, the impact of development on facility needs is analyzed in terms of quantifiable relationships between various types of development and the demand for public facilities based on applicable level-of-service standards. This report contains all of the information ne eded to demonstrate compliance with this element of the nexus. Benefit.Development must benefit from facilities funded by impact fees. With respect to the benefit relationship, the most basic requirement is that facilities funded by impact fees be available to serve the development paying the fees. A sufficient benefit relationship also requires that impact fee revenues be segregated from other funds and expended in a timely manner on the facilities for which the fees were charged. Nothing in the U.S. Con stitution or California law requires that facilities paid for with impact fee revenues be available exclusively to development projects paying the fees. Procedures for earmarking and expenditure of fee revenues are mandated by the Mitigation Fee Act, as are procedures to ensure that the fees are either expended expedi tiously or refunded.Those requirements are intended to ensure that developments benefit from the impact fees they are required to pay. Thus, over time, procedural issues as well as substant ive issues can come into play with respect to the benefit element of the nexus. Proportionality.Impact fees must be proportional to the impact created by a particular development project. Proportionality in impact fees depends on properly identifying development-related facility costs and calculating the fees in such a way that those costs are allocated in proportion to the facility needs created by different types and amounts of development. The section on impact fee methodology, below, describes metho ds used to allocate facility costs and calculate impact fees that meet the proportionality standard. California Constitution.The California Constitution grants broad police power to local governments, including the authority to regulate land use and deve lopment. That police power 237 City of La Quinta Page 1-3 Development Impact Fee Study August 8, 2019 is the source of authority for local governments in California to impose impac t fees on development. Some impact fees have been challenged on grounds that they are special taxes imposed without voter approval in violation of Ar ticle XIIIA. However, that objection is valid only if the fees charged to a project exceed the cost of pr oviding facilities needed to serve the project. In that case, the fees would also run afoul of the U. S. Constitution and the Mitigation Fee Act. Articles XIIIC and XIIID, added to the California Constitution by Proposition 218 in 1996, require voter approval for some “property-related fees,” but exempt “the imposition of fees or charges as a condition of property development.” The Mitigation Fee Act.California’s impact fee statute originated in Assembly Bill 1600 during the 1987 session of the Legislature, and took effect in January, 1989. AB 1600 added several sections to the Government Code, beginning with Section 66000. Since that time ,the impact fee statute has been amended from time to time, and in 1997 was officially titled the “Mitigation Fee Act.” Unless otherwise noted, code sections referenced in this report are from the Government Code. The Mitigation Fee Act does not limit the types of capital improvements for which impact fees may be charged. It defines public facilities very broadly to include "public improvements, public services and community amenities." Although the issue is not specifically addressed in the Mitigation Fee Act, it is clear both in case law and statute (see Government Code Section 65913.8) that impact fees may not be used to pay for maintenance or operating costs. Consequently, the fees calculated in this report are based on the cost of capital assets only. The Mitigation Fee Act does not use the term “mitigation fee” except in its official title. Nor does it use the more common term “impact fee.” The Act simply uses the word “fee,” which is defined as “a monetary exaction, other than a tax or special assessm ent…that is charged by a local agency to the applicant in connection with approval of a development projec t for the purpose of defraying all or a portion of the cost of public facilities related to the development project ….” To avoid confusion with other types of fees, this report uses the widely -accepted terms “impact fee” and “development impact fee” which both should be understood to mean “fee” as defined in the Mitigation Fee Act. The Mitigation Fee Act contains requirements for establishing, incre asing and imposing impact fees. They are summarized below. It also contains provisions that govern the c ollection and expenditure of fees and requires annual reports and periodic re -evaluation of impact fee programs. Those administrative requirements ar e discussed in the implementation chapter of this report. Required Findings.Section 66001 requires that an agency establishing, increasing or imposing impact fees, must make findings to: 1.Identify the purpose of the fee; 238 City of La Quinta Page 1-4 Development Impact Fee Study August 8, 2019 2.Identify the use of the fee;and, 3.Determine that there is a reasonable relationship between: a.The use of the fee and the development typ e on which it is imposed; b.The need for the facility and the type of development on which the fee is imposed; and c.The amount of the fee and the facility cost attributable to the development project. (Applies when fees are imposed on a specific project .) Each of those requirements is discussed in more detail below. Identifying the Purpose of the Fees.The broad purpose of impact fees is to pro tect public health, safety and general welfare by providing for adequate public facilities. The specific purpose of the fees calculated in this study is to fund construction of certain capital improvements that will be needed to mitigate the impacts of pla nned new development on City facilities, and to maintain an acceptable level of public services as the City g rows. This report recommends that findings regarding the purpose of an impact fee should define the purpose broadly, as providing for the funding of adequate public facilities to serve additional development. Identifying the Use of the Fees.According to Section 66001,if a fee is used to finance public facilities, those facilities must be identified. A capital improvement pl an may be used for that purpose but is not mandatory if the facilities are identified in a General Plan, a Specific Plan, or in other public documents.In this case, we recommend that the City Council adopt this report as the public document that identifies the facilities to be funded by the fees. Reasonable Relationship Requirement.As discussed above, Section 66001 requires that , for fees subject to its provisions, a "reasonable relationship" must be demonstrated between: 1.the use of the fee and the type of development on which it is imposed; 2.the need for a public facility and the type of development on which a fee is imposed; and, 3.the amount of the fee and the facility cost attributable to the development on which the fee is imposed. These three reasonable relationship requirements, as defined in the statute, mirror the nexus and proportionality requirements often cited in cou rt decisions as the standard for defensible impact fees. The term “dual rational nexus” is often used to characterize the standard used by courts in evaluating the legitimacy of impact fees. The “duality” of the nexus refers to (1) an impact or need created by a development project subject to impact fees, and (2) a benefit to the project from the expenditure of the fees. 239 City of La Quinta Page 1-5 Development Impact Fee Study August 8, 2019 Although proportionality is reasonably implied in the dual rational nexus formulation, it was explicitly required by the Supreme Court in the Dolan case,and we prefer to list it as the third element of a complete nexus. Development Agreements and Reimbursement Agreements.The requirements of the Mitigation Fee Act do not apply to fees collected under development agreements (see Govt. Code Section 66000)or reimbursement agreements (see Govt. Code Section 66003). The same is true of fees in lieu of park land dedication imposed under the Quimby Act (see Govt. Code Section 66477). Existing Deficiencies.In 2006, Section 66001(g) was added to the Mitigation Fee Act (by AB 2751) to clarify that impact fees “shall not include costs attributable to existing deficiencies in public facilities,…” The legislature’s intent in adopting this amendment, as stated in the bill, was to codify the holdings of Bixel v. City of Los Angeles (1989), Rohn v. City of Visalia (1989), and Shapell Industries Inc. v. Governing Board (1991). That amendment does not appear to be a substantive change. It is widely understood that other provisions of law make it improper for impact fees to include costs for correcting existing deficiencies. However, Section 66001(g) also states that impact fees “may include the costs attributable to the increased demand for public facilities reasonably related to the development pr oject in order to (1) refurbish existing facilities to maintain the existing level of service or (2) achieve an adopted level of service that is consistent with the general plan.” (Emphasis added.) Impact Fees for Existing Facilities.Impact fees may be used to recover costs for existing facilities to the extent that those facilities are needed to serve additional development and have the capacity to do so. In other words, it must be possible to show that fees used to pay for existing facilities meet the need and benefit elements of the nexus. The Quimby Act.The Quimby Act (Government Code Section 66477), which pre -dates the Mitigation Fee Act, authorizes a city or county to require dedication of land, payment of fees in - lieu of dedication, or a combin ation of both, for park and recreational purposes as a condition of approval of a residential subdivision. The city or county must adopt an ordinance that includes definite standards for determining the proportion of the subdivision to be dedicated and the amount of the in-lieu fees to be paid. Under the Quimby Act, land dedication and in -lieu fee requirements are based on the ratio of park acres to population in the jurisdiction. That ratio may not exceed three acres per thousand residents unless the existing ratio is higher, but is limited to five acres per thousand. The population added by the subdivision is determined by the number of dwelling units and the average number of persons per household. The population and the average number of persons per hou sehold in the city or county are to be based on the most recent federal census. Park acreage is to be based on the area of neighborhood and community parks in the city or county at the time of that census. 240 City of La Quinta Page 1-6 Development Impact Fee Study August 8, 2019 The land, fees, or combination thereof are to be u sed only for the purpose of developing new or rehabilitating existing neighborhood or community park or recreational facilities to serve the subdivision. A 2013 amendment to the Quimby Act added a provision that in -lieu fees may be used for the purpose of developing new or rehabilitating existing park or recreational facilities in a neighborhood other than the neighborhood in which the subdivision paying the fees is located, if certain conditions are met (see paragraph (a)(3)(B) of Section 66477). “Neighborhood” is not defined in the statute. The Quimby Act requires that the legislative body adopt a general plan or specific plan containing policies and standards for parks and recreational facilities, and that the amount and location of land to be dedicated o r the fees to be paid shall bear a reasonable relationship to the use of the park and recreational facilities by future inhabitants of the subdivision. The Quimby Act provides that if park and recreational services and facilities are provided by a public agency other than a city or county, the amount and location of park land to be dedicated or fees to be paid shall be jointly determined by that other public agency and the city or county having jurisdiction. The land or fees shall be conveyed directly to th e public agency that provides park and recreational services on a communitywide level if that agency elects to accept the land or fee. Only payment of fees may be required for subdivisions containing 50 units or less, or for condominium, stock cooperative or community apartment projects. Impact Fee Calculation Methodology Any one of several legitimate methods may be used to calculate impact fees. The choice of a particular method depends primarily on the service characteristics of, and planning requirements for, the facility type being addressed. Each method has advantages and disadvantages in a particular situation. To some extent they are interchangeable, because they all allocate facility costs in proportion to the needs created by development. Allocating facility costs to various types and amounts of development is central to all methods of impact fee calculation. Costs are allocated by means of formulas that quantify the relationship between development and the need for facilities. In a cost allocation formula, the impact of development is measured by some attribute of development such as added population or added vehicle trips that represent the impacts created by different types and amounts of development. Plan-Based or Improvements-Driven Method.Plan-based impact fee calculations are based on the relationship between a specified set of improvements and a specified increment of development.The improvements are typically identified in a facility plan, while the development is identified in a land use plan that forecasts potential development by type and quantity. Using this method, facility costs are allocated to various categories of development in proportion to the service demand created by each type of development. To calculate plan- 241 City of La Quinta Page 1-7 Development Impact Fee Study August 8, 2019 based impact fees, it is necessary to determine what facilities will be needed to serve a particular increment of new development. With this method, the total cost of eligible facilities is divided by the total units of additional demand to calculate a cost per unit of demand (e.g.a cost per capita for parks). Then, the cost per unit of demand is multiplied by factors representing demand per unit of development (e.g. population per unit) to arrive at a cost per unit of development. This method is somewhat inflexible in that it is based on the relationship between a specific facility plan and a specific land use plan. If either plan changes significant ly the fees will have to be recalculated. Capacity-Based or Consumption-Driven Method. This method calculates a cost per unit of capacity based on the relationship between total cost and total capacity of a system. It can be applied to any type of development, provided the capacity required to serve each increment of development can be estimated and the fa cility has adequate capacity available to serve the development. Since the cost per unit of demand does not depend on the particular type or quantity of development to be served, this method is flexible with respect to changing development plans. In this method, the cost of unused capacity is not allocated to development. Capacity -based fees are most commonly used for water and wastewater systems, where the cost of a system component is divided by the capacity of that component to derive a unit cost. H owever, a similar analysis can be applied to other types of facilities. To produce a schedule of impact fees based on standardized units of development (e.g. dwelling units or square feet of non - residential building area), the cost per unit of capacity is multiplied by the amount of capacity required to serve a typical unit of development in each of several land use categories. Standard-Based or Incremental Expansion Method.Standard-based fees are calculated using a specified relationship or standard th at determines the number of service units to be provided for each unit of development. The standard can be established as a matter of policy or it can be based on the level of service being provided to existing development in the study area. Using the standard-based method, costs are defined on a generic unit -cost basis and then applied to development according to a standard that sets the number of service units to be provided for each unit of development. Park in-lieu and impact fees are commonly calculated this way. The level of service standard for parks is typically stated in terms of acres of parks per thousand residents. A cost -per-acre for park land or park improvements can usually be estimated without knowing the exact size or location of a particular park. The ratio of park acreage to population and the cost per acre for parks is used to calculate a cost per capita. The cost per capita can then be converted into a cost per unit of development based on the average population per dwelli ng unit for various types of residential development. 242 City of La Quinta Page 1-8 Development Impact Fee Study August 8, 2019 Facilities Addressed in this Study Impact/in-lieu fees for the following types of facilities are addressed in this report: Park Land and Improvements Community and Cultural Centers Library Facilities Civic Center Facilities Maintenance Facilities Fire Protection Facilities Transportation Facilities Each of those facilities is addressed in s separate chapter of this report, beginning with Chapter 3.Chapter 2 contains data on existing and fut ure development used in th e impact fee analysis. 243 City of La Quinta Page 2-1 Development Impact Fee Study August 8, 2019 Chapter 2.Development Data This chapter presents data on existing and future development that will be used to calculate impact fees in subsequent chapters of this report. The information in this chapter may be used to establis h levels of service, analyze facility needs, and/or allocate the cost of capital facilities between existing and future development and among various types of new development. Background and Setting La Quinta is located along Highway 111 in the desert res ort area of the Coachella Valley in south-central Riverside County, adjacent to the City of Indian Wells to the west and the City of Indio to the east. Existing development in the City is primarily residential and includes both conventional residential development and gated residential and resort communities, some of which contain one or more golf courses. Major regional commercial development in La Quinta exists along Highway 111 in La Quinta and more is planned. A significant portion of the land within th e City lies on the steep slopes of the Santa Rosa and Coral Reef mountains. Much of that area is preserved as open space. Study Area and Development Scenario The study area for this impact fee study is the existing City, meaning the area within the exist ing corporate boundaries of La Quinta.The future development scenario used in this study assumes buildout of all developable land within those corporate boundaries. La Quinta’s population fluctuates seasonally. Projections in this chapter indicate that undeveloped residential land in the study area has the capacity to accommodate approximately 18,000 additional residents when all of the projected new residential units in the City are occupied. That would be an increase of about 28% from the City’s estimat ed 2019 full- occupancy population of 64, 531, and would bring the total population within the existing corporate boundaries of La Quinta to just over 82,000 when all residential units are occupied. As explained below, the term “potential population” is use d elsewhere in this study to mean the population of the City when all residential units are occupied. Time Frame No time frame is assumed for the buildout of future development projected in this study. The methods used to calculate impact fees in this stud y do not require assumptions regarding the rate or timing of development. 244 City of La Quinta Page 2-2 Development Impact Fee Study August 8, 2019 Development Types The development types defined in this study are intended to reflect actual land uses rather than zoning or general plan land use designations. The following breakd own of development types is used throughout this study: Residential -Single Family Detached Residential –Single-Family Attached Residential –Multi-Family/Other Office General Commercial Tourist Commercial Public Facilities Public Schools Parks Golf Courses Residential Development and Population As indicated in the list above, this study classifies residential development into three categories: Single-Family Detached, Single-Family Attached, which includes condominiums and townhouses, and Multi-Family/Other which includes ap artments and mobile homes. Dwelling units are used as the basic measure of the amount of the amount of existing and future development in each residential category. The graph at right shows the California Department of Finance (DOF) official January 1 population estimates for the City of La Quinta for the years from 2010 through 2018. DOF’s population estimate for La Quinta has grown at an average rate of 1.2% per year since 2010. The City’s estimated January 1, 2018 population of 41,204 is an increase of 3,737 or 10% from a population of 37,467 at the time of the 2010 Census. The figures shown above reflect the City’s total population, including both household population and population in group quarters such as nursing homes. Th e group quarters population in La Quinta is very small, amounting to only 57 people in 2018. It is important to note that the official Census Bureau and Department of Finance population estimates reflect only the City’s permanent population. A substantial percentage of the 245 City of La Quinta Page 2-3 Development Impact Fee Study August 8, 2019 dwellings in La Quinta are occupied seasonally, so the official population estimat es substantially understate the service demand represented by residential development in La Quinta. Once a dwelling unit has been approved and constructed , the City is committed to serve the demand created by that unit, even if that demand is seasonal. Th e City has no control over whether or when such units are occupied. Thus, to better represent the City’s service commitments, this study uses “potential population” to gauge the de mand for population-related public services and the facilities that support them. As used in this study, “potential population” means the number of people who would reside in the City when all dwelling units existing at a particula r time are occupied. Unless otherwise indicated, when the term “population” is used in subsequent cha pters of this report, it will mean potential population. The potential population is estimated for each category of residential development by multiplying the number of units (existing or future) in that category by the average population per unit for that type of development. This study uses data from the U. S. Census Bureau’s 2017 American Community Survey 5 -year Estimates to calculate the population per d welling unit factors for each category of residential development defined in this study. Those factor s are shown in Table 2.1. Non-Residential Development In this study, private, non -residential development is classified into three categories : Office, General Commercial and Tourist Commercial. The Office category is equivalent to the Office Commercial (CO) classification in the General Plan Land Use Element. Tourist Commercial is equivalent to the Tourist Commercial (CT) classification in the Land Use Eleme nt. And the General Commercial category used in this study encompasses all other types of commercial development defined in the Land Use Element. La Quinta has no existing industrial development and none is planned within the existing City. For purposes of impact fee analysis, commercial development can be measured in a number of ways. In this report, the basic measure of office and general commercial development is gross building area in thousands of square feet, which is abbreviated “KSF.” Tourist commerc ial development, which consists of hotels and associated uses, is measured in terms of “rooms,” meaning guest rooms or suites. Several other categories of non-residential development are also used in this study. Those categories are Public Facilities, Schools, Parks and Golf Courses. The amount of existing and future development in the Public Facilities c ategory is measured in terms of building area in KSF. Schools, Parks and Golf Courses are measured in terms of acreage. Demand Variables To calculate impact fees, the relationship between facility needs and development must be quantified in cost allocati on formulas. Certain measurable attributes of development (for 246 City of La Quinta Page 2-4 Development Impact Fee Study August 8, 2019 example, added population or added vehicle trips) are used as “demand variables” in those formulas to represent the impact of different types of development on various types of facilities. Demand variables are selected either because they directly measure the service demand created by various types of development, or because they are reasonabl y correlated with that demand. For example, the need for parks in a community is typically defined in terms of the relationship between population and acres of parks. As population grows, more parks are needed to maintain that relationship. Logically,then, the increase in population related to new residential development is an appropriate yardstick,or demand variable, for use in measuring the impact of development on the need for additional parks. Each demand variable has a specific value for each t ype of development defined in this study. Those values may be referred to as “demand factors.”So, if the demand variable used to calculate impact fees for a particular type of facility is added population, the demand factor for single-family residential d evelopment would be the p opulation per dwelling unit for that specific type of development. Demand variables used in this study are discussed below, and specific demand factors can be found in Table 2.1. Acreage.Acreage is a basic attribute of all development. In this report, net developed acreage is used as a demand variable for some types of facilities. Population.Resident population is used in this study to represent the need for facilities such as parks and community centers that are intended to se rve residents of the City and are not impacted substantially by non-residential development. As discussed above, because of seasonality in La Quinta’s population, the population used to calculate impact fees in thi s study is “potential population” Weighted Peak Hour Trips.Both the number of peak hour trips generated by development and the length of those trips affect the amount of peak hour roadway capacity needed to serve development. The demand variable used to calculate impact fees for transportation facilities in this report is weighted peak hour trips, which is the product of the number of peak hour trips per unit per day and a trip length factor representing the relationship between the average trip length fo r a particular development type and the system-wide average trip length. The best available information on trip lengths by development type are those published by the San Diego Association of Governments (SANDAG) in the publication Traffic Generators.Although the trip lengths presented in that publication do not specifically apply to La Quinta, we believe they reasonably represent the proportional relationship of trip lengths for various types of development in the City. Because the cost of street improvements is allocated to development projects in proportion to their relative share of total demand, it is the relative relationship, rather than the actual trip length that is important in the impact fee calculations. 247 City of La Quinta Page 2-5 Development Impact Fee Study August 8, 2019 It should be noted that the Coachella Valley Association of Governments (CVAG) has developed trip length data for the Coachella Valley. However, those trip lengths are calculated by trip purpose not by development type. In addition, they are intended to reflect travel on regional facilities and do not include the portion of trips on local street networks. Consequently, the CVAG trip length information is not useful for purposes of impact fee analysis. Peak hour trips-per-unit-per-day, trip length factors and weighted peak hour trips for each type of development defined in this study are shown in Table 2.1. Demand Factors Table 2.1 on the next page shows the values of demand factors used in this study, by development type. Existing and Forecasted Development Summaries of existing and forecasted development within the corporate boundarie s of La Quinta, by development type, are presented in Tables 2.2 through 2.4 later in this section. At present, La Quinta is about 78% built out in terms of the total residential units and potential population forecasted for buildout within the existing co rporate boundaries of the City. Commercial and Office development are approximately 63% built out based on square footage, and Tourist Commercial is about 45% built out based on existing and forecasted h otel rooms. Table 2.1 Demand Factors Land Use Category Unit Type Acres per Unit 1 Population per Unit 2 Pk Hr Trips per Unit 3 Trip Length Factor 4 Wtd Pk Hr Trips per Unit 5 Residential - Single Family Detached DU 0.245 2.70 1.01 1.14 1.16 Residential - Single Family Attached DU 0.222 2.30 0.78 1.14 0.89 Residential - Multi-Family/Other DU 0.125 2.20 0.58 1.14 0.66 Office/Medical KSF 0.104 1.49 1.28 1.90 General Commercial KSF 0.104 3.75 0.62 2.34 Tourist Commercial/Lodging Rooms 0.139 0.49 1.10 0.54 Public Facilities KSF 0.270 2.85 0.87 2.48 Schools Acres 1.000 1.30 0.61 0.79 Parks Acres 1.000 1.59 0.32 0.51 Golf Courses Acres 1.000 0.30 0.91 0.27 1 Acres per unit based on projected buildout conditions 2 Average population per unit based on analysis of data from U. S. Census Bureau, 2017 American Community Survey (2017, 5-Year Estimate), Tables B25032 and B25033 3 Peak hour trips per unit per day from the Institute of Transportation Engineers (ITE)Trip Generation Manual, 8th Edition 4 Trip length factor = average trip length for each development type / a system-wide average of 6.9 miles; trip lengths based on data from the San Diego Association of Governments (SANDAG) publication,Traffic Generators (see discussion in text) 5 Weighted peak hour trips per unit = peak hour trips per unit X trip length factor 248 City of La Quinta Page 2-6 Development Impact Fee Study August 8, 2019 As of 2019, single family residential un its make up approximately 80% of all residential units in the City, with the other two categories of residential development comprising about 10% each. That mix is projected to change very little as a re sult of future development forecasted for this study. Table 2.2 on the next p age shows estimated existing development in the City as of January 1, 2018, in terms of acres, units, potential population, and weighted peak hour trips. Table 2.3 on the next page shows forecasted future development within the existing corporate boundaries of the City of La Quinta through buildout. Table 2.2 Existing Development as of January 1, 2019 Land Use Category Developed Acres 1 Unit Type 2 No. of Units 3 Potential Population 4 Wtd Pk Hr Trips 5 Residential - Single Family Detached 4,824 DU 19,780 53,406 22,945 Residential - Single Family Attached 532 DU 2,417 5,559 2,151 Residential - Multi-Family/Other 317 DU 2,530 5,566 1,670 Office/Medical 78 KSF 753 1,431 General Commercial 423 KSF 3,692 8,639 Tourist Commercial/Lodging 207 Room 1,130 610 Public Facilities 88 KSF 360 893 Schools 115 Acre 115 91 Parks 242 Acre 242 123 Golf Courses 4,317 Acre 4,317 1,166 Totals 11,143 64,531 39,719 1 Existing developed acres estimated by the City of La Quinta Design and Development Department 2 DU = dwelling unit; KSF = 1,000 gross square feet of building area; Room = guest room or suite; Acre = net developed acre 3 Number of existing units estimated by the City of La Quinta Design and Development Department 4 Potential population = number of residential units X population per unit from Table 2.1 5 Existing weighted peak hour trips = number of units X weighted peak hour trips per unit from Table 2.1 249 City of La Quinta Page 2-7 Development Impact Fee Study August 8, 2019 Table 2.4 on the next page shows total development at buildout of the existing City. Table 2.3 Additional Development to Buildout of the Existing City Land Use Category Developed Acres 1 Unit Type 2 No. of Units 3 Potential Population 4 Wtd Pk Hr Trips 5 Residential - Single Family Detached 1,294 DU 5,186 14,002 6,016 Residential - Single Family Attached 170 DU 743 1,709 661 Residential - Multi-Family/Other 118 DU 946 2,081 624 Office/Medical 54 KSF 512 973 General Commercial 104 KSF 1,358 3,178 Tourist Commercial/Lodging 138 Room 1,360 735 Public Facilities 32 KSF 84 208 Schools 0 Acre 0 0 Parks 54 Acre 54 28 Golf Courses 817 Acre 817 220 Totals 2,781 17,792 12,643 1 Increase in developed acres estimated by the City of La Quinta Design and Development Dept. 2 DU = dwelling unit; KSF = 1,000 gross square feet of building area; Room = guest room or suite; Acre = net developed acre 3 Increase in the number of units estimated by the City of La Quinta Design and Development Dept. 4 Increase in potential population = increase in residential units X population per unit from Table 2.1 5 Increase in weighted peak hour trips = increase in number of units X weighted peak hour trips per unit from Table 2.1 250 City of La Quinta Page 2-8 Development Impact Fee Study August 8, 2019 Table 2.4 Total Development at Buildout of the Existing City Land Use Category Developed Acres 1 Unit Type 2 No. of Units 3 Potential Population 4 Wtd Pk Hr Trips 5 Residential - Single Family Detached 6,118 DU 24,966 67,408 28,961 Residential - Single Family Attached 702 DU 3,160 7,268 2,812 Residential - Multi-Family/Other 435 DU 3,476 7,647 2,294 Office/Medical 132 KSF 1,265 2,404 General Commercial 527 KSF 5,050 11,817 Tourist Commercial/Lodging 345 Room 2,490 1,345 Public Facilities 120 KSF 444 1,101 Schools 115 Acre 115 91 Parks 296 Acre 296 151 Golf Courses 5,134 Acre 5,134 1,386 Totals 13,924 82,323 52,362 1 Developed acres at buildout estimated by the City of La Quinta Design and Development Department 2 DU = dwelling unit; KSF = 1,000 gross square feet of building area; Room = guest room or suite; Acre = net developed acre 3 Number of units at buildout estimated by the City of La Quinta Design and Development Department 4 Potential population at buildout = residential units X population per unit from Table 2.1 5 Weighted peak hour trips at buildout = number of units X wieghted peak hour trips per unit from Table 2.1 251 City of La Quinta Page 3-1 Development Impact Fee Study August 8, 2019 Chapter 3.Parks and Recreation Impact Fees This chapter updates two different types of fees available for funding parks tha t serve the added population associated with new residential development in La Quinta. 1.Quimby Act In-Lieu Fees -The Quimby Act (Government Code 66477) authorizes the City to require that residential subdivisions dedicat e land for parks or pay fees in lieu of dedication. This chapter calculates the in -lieu fees, which apply only to residential projects that involve a subdivision. 2.Development Impact Fees –Impact fees for parkland acquisition that apply to residential projects not involving a subdivision,and impact fees for construction of park improvements that apply to all residential development projects. Demand Variable A demand variable is an attribute of de velopment that is used to represent the impact of development on a particular type of facilit y. The need for parks is almost universally defined in terms of the population to be served, so the demand variable used to calculate impact fees in this chapter is added population. Because the impact of development on the need for parks is created by an increase in population associated with new residential development, the fees calculated in this chapter will apply only to new residential development. Service Area La Quinta’s park facilities serve the entire City, so impact fees for those facilities w ill apply to all new residential development within the existing corporate boundaries of the City. Existing Facilities Both Quimby Act and park impact fee calculations in this chapter reference a list of the City’s existing parks as part of their basis.Table 3.1 lists La Quinta’s existing parks and breaks down the acreage of each park into city-owned and city-improved acres. 252 City of La Quinta Page 3-2 Development Impact Fee Study August 8, 2019 All acreage of existing parkland shown in Table 3.1 is improved with the exception of two nature preserve areas, Fred Wolff Bear Creek Nature Preserve and Cove Oasis. This analysis estimates that 10 percent of the total acreage of those preserve areas, or 14 acres, is improved as nature trails and public access points. Those 14 acres are treated as developed community park acreage in this analysis. The land under the sports fields at Paige Middle School is owned by the Desert Sands Unified School District, but the City has paid for the impr ovements to that land.Similarly,the land under the Sports Complex is also owned by the Scho ol District, but the City has paid for the improvements to that park. The City is currently developing two new parks not listed in Table 3.1: the 14 -acre Silver Rock Event Venue which is out to bid, and the two -acre X Park skate park which is nearing construction. Quimby Act Fees in Lieu of Park Land Dedication The calculation of fees subject to the stipulations of the Quimby Act differs in a number of ways from park impact fees, which are discussed later in this chapter. Table 3.1: Existing Parks Park Park City-Owned City-Improved Name Type Acres Acres Adams Park Neighborhood Park 3.50 3.50 Civic Center Campus Community Park 7.90 7.90 Desert Pride Park Neighborhood Park 1.00 1.00 Eisenhower Park Mini Park 0.50 0.50 Fritz Burns Park Community Park 12.00 12.00 La Quinta Park Community Park 18.00 18.00 La Quinta Community Park (Frances Hack) Community Park 6.50 6.50 Monticello Park Neighborhood Park 4.00 4.00 Pioneer Park Neighborhood Park 3.20 3.20 Paige Middle School Sports Fields Community Park 0.00 7.00 Saguaro Park Mini Park 0.75 0.75 Sports Complex Community Park 0.00 16.75 Seasons Park Neighborhood Park 5.00 5.00 Velasco Park Mini Park 0.25 0.25 Fred Wolff Bear Creek Nature Preserve Open Space 26.00 2.60 Cove Oasis Open Space 114.00 11.40 Total 202.60 100.35 Source: City of La Quinta 253 City of La Quinta Page 3-3 Development Impact Fee Study August 8, 2019 Methodology and Level of Service Standard –Quimby Act The level of service standard used to calculate Quimby Act fees in lieu of parkland dedication is based on the relationship between population and park acreage, but it must conform to rules specified in the statute. The Quimby Act (Government Code Section 66477) requires use of population data as shown in the most recent available federal census, which at the time of this study is the 2010 Census population. The statute authorizes municipalities to im pose a requirement on residential subdivisions (including parcel maps) that they dedicate land for parks or pay fees in lieu of park land dedication. Those requirements may not exceed the 2010 ratio of park acreage to population if that ratio is between 3.0 acres per thousand and 5.0 acres per thousand. If the 2010 ratio is lower than 3.0 acres per thousand, land dedication and/or in lieu fees may be based on 3.0 acres per thousand. As shown in Table 3.2, La Quinta’s ratio is below the Quimby Act’s minimum standard. Consequently, the park land in-lieu fees calculated later in this chapter are based on the minimum of 3.0 acres per thousand. Fees In-Lieu of Park Land Dedication –Quimby Act Per Chapter 13.48.060 of the City’s Municipal Code, Quimby Act pa rkland acquisition in -lieu fees “…shall be based on the fair market value of land within a subdivision.” As such, the City calculates these fees on a case by case basis, depending on the market value of land under each subdivision at the time the project i s approved using the following formula to determine the fee: Table 3.2: Level of Service - Quimby Act Facility Acres1 Population2 Acres per Capita 3 Acres per 1000 4 Total Park Acres - 2010 (Quimby) 100.35 58,610 0.00171 1.71 1 All parks shown in Table 3.1 were in existence in 2010 2 Reflects 2010 potential population based on 100% occupancy of 2010 dwelling units 3 Acres per capita = existing acres / existing population 4 Acres per 1,000 population = acres per capita X 1,000 254 City of La Quinta Page 3-4 Development Impact Fee Study August 8, 2019 Quimby Act Park Land Acquisition In-lieu fee = Number of dwelling units x Population per dwelling unit by development type x .003 acres per capita x market value of land per acre A review of the in-lieu fees charged by the City since 2010 shows that per-acre in-lieu fees have varied widely from project-to-project.As an alternative, the City Council could choose to establish a standardized schedule of in-lieu fees based on the estimated average Citywide cost- per-acre for park land used in this chapter.Table 3.3 shows what those in-lieu fees would be if the City Council chooses this alternative. Table 3.3: Park Land In-Lieu Fees per Unit Development Cost per Population Impact Fee Admin Adj Impact Type Units 1 Capita 2 per DU 3 per Unit 4 Charge 5 Fee per Unit 6 Residential - Single Family Detached DU $1,306.80 2.70 $3,528.36 $11.43 $3,539.79 Residential - Single Family Attached DU $1,306.80 2.30 $3,005.64 $9.74 $3,015.38 Residential Multi-Family/Other DU $1,306.80 2.20 $2,874.96 $9.31 $2,884.27 1 Units of development: DU = dwelling unit 2 Cost per capita = 0.003 acres per capita X $435,600 per acre 3 See Table 2.1 4 Impact fee per unit = cost per capita X population per dwelling unit 5 Administrative charge based on 0.324% of the impact fee per unit; see discussion in text 6 Adjusted impact fee per unit including administrative charge 255 City of La Quinta Page 3-5 Development Impact Fee Study August 8, 2019 Park Impact Fees This chapter calculates two types of impact fees for parks: 1.Park land acquisition impact fees, which apply to residential projects that do not involve a subdivision. 2.Park improvement impact fees, which apply to all residential development in addition to any park land dedication,park land in-lieu (Quimby Act) fees, or park land acquisition impact fees. Park improvement impact fees would be used to construct park improvements to serve the added population associated with new residential development. Methodology-Park Impact Fees The method used to calculate development impact fees in this chapter is the standar d-based method discussed in Chapter 1. That method calculates impact fees using a level -of-service standard and the estimated cost of new facil ities needed to maintain that standard. The level of service standard used in this chapter is discussed below. Level of Service Standard –Park Impact Fees The level of service standard used to calculate the park impact fees in this chapter is the City’s existing level of service, defined as the relationship between existing park acreage and existing population.Table 3.4 shows the ratio of park acreage to population based on the estimated potential population as of January 1, 2019. See Chapter 2 for a disc ussion of potential population. Cost Per Capita –Park Impact Fees The following tables convert the acres-per-capita factor from Table 3.4 into costs per capita. Table 3.5 calculates the cost per capita for park land acquisition impact fees, which can be applied to residential projects that do not involve a subdivision. Table 3.4: Existing Level of Service - Impact Fees Facility Acres1 Existing Population2 Acres per Capita Acres per 1000 Existing Park Acres 100.35 64,531 0.00156 1.56 1 See Table 3.1 2 The City's 2019 potential population based on 100% occupancy of all existing dwelling units; see Table 2.2 3 Acres per capita = existing acres / existing population 4 Acres per 1,000 population = acres per capita X 1,000 256 City of La Quinta Page 3-6 Development Impact Fee Study August 8, 2019 Table 3.6 calculates the cost per capita for park improvement impact fees. Park Land Acquisition Impact Fees per Unit Table 3.7 calculates park land acquisition impact fees per dwelling unit based on the cost per capita from Table 3.5 and the population per dwelling unit from Table 2.1 and then adds a small administrative charge to arrive at the adjuste d impact fee per unit. The 0.324% administrative charge is intended to recover the cost of this study over five years. It is calculated by dividing the cost of the study by estimated revenue that would be generated over five years by impact fees calculated in this study (50,000 / 15,455,871 = 0.00324). Table 3.5: Cost per Capita - Park Land Acquisition Impact Fees Cost Cost per Acres per Cost per Component Acre 1 Capita 2 Capita 3 Park Land Acquisition $435,600 0.00156 $677.39 1 Cost per acre estimated by the City of La Quinta 2 See Table 3.4 3 Cost per capita = cost per acre X acres per capita Table 3.6: Cost per Capita - Park Improvements Cost Cost per Acres per Cost per Component Acre 1 Capita 2 Capita 3 Park Improvements $500,000 0.00156 $777.53 1 Cost per acre estimated by the City of La Quinta 2 See Table 3.4 3 Cost per capita = cost per acre X acres per capita Table 3.7: Park Land Acquisition Impact Fees per Unit Development Cost per Population Impact Fee Admin Adj Impact Type Units 1 Capita 2 per DU 3 per Unit 4 Charge 5 Fee per Unit 6 Residential - Single Family Detached DU $677.39 2.70 $1,828.95 $5.93 $1,834.88 Residential - Single Family Attached DU $677.39 2.30 $1,558.00 $5.05 $1,563.04 Residential Multi-Family/Other DU $677.39 2.20 $1,490.26 $4.83 $1,495.09 1 Units of development: DU = dwelling unit 2 See Table 3.5 3 See Table 2.1 4 Impact fee per unit = cost per capita X population per dwelling unit 5 Administrative charge based on 0.324% of the impact fee per unit; see discussion in text 6 Adjusted impact fee per unit including administrative charge 257 City of La Quinta Page 3-7 Development Impact Fee Study August 8, 2019 Park Improvement Impact Fees per Unit Table 3.8 calculates park improvement impact fees per dwelli ng unit based on the cost per capita from Table 3.6 and the population per dwelling unit from Table 2.1 and then adds a small administrative charge to arrive at the adjuste d impact fee per unit. The 0.324% administrative charge is intended to recover the cost of thi s study over five years. It is calculated by dividing the cost of the study by estimated revenue that would be generated over five years by impact fees calculated in this stud y (50,000 / 15,455,871 = 0.00324). Projected Revenue Table 3.9 shows projected revenue from the in-lieu fees and impact fees for park land acquisition calculated in this chapter.Because the fees are different for subdivisions and non- subdivision projects, the only way to project revenue from those fees is to make assumptions about how many future units will be in subdivisions. For purposes of projecting revenue, we are assuming that all new units in the Single Family Detached and Single Family Attached c ategories will involve a subdivision, and that no future units in the Multi-Family/Other category will involve a subdivision.Potential revenue from future residential development is projected by applying the appropriate in-lieu fees or impact fees per unit from Tables 3.3 and 3.7 to added units of residential development from Table 2.3. Table 3.8: Park Improvement Impact Fees per Unit Development Cost per Population Impact Fee Admin Adj Impact Type Units 1 Capita 2 per DU 3 per Unit 4 Charge 5 Fee per Unit 6 Residential - Single Family Detached DU $777.53 2.70 $2,099.33 $6.80 $2,106.13 Residential - Single Family Attached DU $777.53 2.30 $1,788.32 $5.79 $1,794.11 Residential Multi-Family/Other DU $777.53 2.20 $1,710.57 $5.54 $1,716.11 1 Units of development: DU = dwelling unit 2 See Table 3.6 3 See Table 2.1 4 Impact fee per unit = cost per capita X population per dwelling unit 5 Administrative charge based on 0.324% of the impact fee per unit; see discussion in text 6 Adjusted impact fee per unit including administrative charge 258 City of La Quinta Page 3-8 Development Impact Fee Study August 8, 2019 Table 3.10 shows projected revenue from the impact fees for park improvements calculated in this chapter.Potential revenue from future residential development is projected by applying the impact fees per unit from Ta ble 3.8 to added units of residential development from Table 2.3. Updating the Fees The in-lieu fees and impact fees calculated in this chapter are based the current estimated cost of park land and improvements.We recommend that the fees be reviewed periodically and adjusted as needed using local cost data or an index such as the Engineering News Record Construction Cost Index (CCI) Nexus Summary As discussed in Chapter 1 of this report, Section 66001 of the Mitigation Fee Act requires that an agency establishing, increasing or imposin g impact fees, must make findings to : Table 3.9: Projected Impact Fee Revenue from Park Land In-Lieu and Impact Fees Development Fee per Future Projected Type Units 1 Unit 2 Units 3 Revenue 4 Residential - Single Family Detached DU $3,539.79 5,186 18,357,361$ Residential - Single Family Attached DU $3,015.38 743 2,240,426$ Residential Multi-Family/Other DU $1,495.09 946 1,414,352$ Total 22,012,139$ 1 Units of development: DU = dwelling unit 2 Fee per unit for Single Family Detached and Single Family Attached from Table 3.3; Fee for Multi-Family/Other from Table 3.7 3 See Table 2.3 4 Impact fee per unit = cost per capita X population per dwelling unit Table 3.10: Projected Impact Fee Revenue from Park Improvement Impact Fees Development Fee/Unit of Future Projected Type Units 1 Development Units Revenue Residential - Single Family Detached DU $2,106.13 5,186 10,922,405$ Residential - Single Family Attached DU $1,794.11 743 1,333,026$ Residential Multi-Family/Other DU $1,716.11 946 1,623,438$ Total 13,878,869$ 1 Units of development: DU = dwelling unit 2 See Table 3.8 3 See Table 2.3 4 Impact fee per unit = cost per capita X population per dwelling unit 259 City of La Quinta Page 3-9 Development Impact Fee Study August 8, 2019 Identify the purpose of the fee; Identify the use of the fee; and, Determine that there is a reasonable relationship between: a.The use of the fee and the development type on which it is imposed; b.The need for the facility and the type of development on which the fee is imposed; and c.The amount of the fee and the facility cost attributable to the development project. Satisfying those requirements also ensures that the fees meet the “rational nexus” and “rough proportionality” standards enunciated in leading court decisions bearing on impact fees and other exactions. (For more detail, see “Legal Framework for Impact Fees” in Chapter 1.) The following paragraphs explain how the impact fees calculated in this chapter satisfy those requirements. Purpose of the Fee:The purpose of the impact fees calculated in this chapter is to mitigate the impact of new development on the need for parks in La Quinta. Use of the Fee.Impact fees calculated in this chapter will be used t o provide additional parks to mitigate the impacts of new development in the City. As provided by the Mitigation Fee Act, revenue from impact fees may al so be used for temporary loans from one impact fee fund or account to another. Reasonable Relationship between the Use of the Fee and the Development Type on Which It Is Imposed.The impact fees calculated in this chapter will be used to provide additional parks to serve the needs of additional population associated with new residential development in La Quinta. Reasonable Relationship between the Need for the Facilities and the Type of Development on Which the Fee Is Imposed.New residential development increases the need for parks to maintain the existing level of service, as described earlier in this cha pter. Without additional parks, the increase in population associated with new residential development would result in a reduction in the level of service provided to all residents of the City. Reasonable Relationship between the Amount of the Fee and the Facility Cost Attributable to the Development Project.The amount of the Parks and Recreation impact fees charged to a residential development project will depend on the increase in population associated with that project. The fees per unit of development calculated in this chapter for each type of residential development are based on the estimated average population per unit for that type of development in La Quinta. Thus, the fee charged to a development project reflects the impact of that project on the need for parks in the City. 260 City of La Quinta Page 4-1 Development Impact Fee Study August 8, 2019 Chapter 4.Community and Cultural Centers This chapter calculates impact fees for community and cultural centers needed to serve future development in La Quinta. This fee was formerly known as the Community Centers impact fe e. The scope of the fee has been broadened in t his study to include cultural facilities such as the La Quinta Museum. Previously, only portions o f the museum and Boys and Girls Club used as meeting rooms were covered by the Community Centers impact fee. The impact fees calculated in this chapter are ba sed on the City’s existing investment per capita in community and cultural center facilities, and will be used to provide additional facilities to maintain the current level of service as the City continues to grow. Methodology The method used to calculate impact fees in this chapter is the standard -based method discussed in Chapter 1. That method calculates impact fees using a level-of-service standard and the estimated cost of new facilities needed to maintai n that standard.The level of service standard used in this chapter is discussed below. Demand Variable A demand variable is an attribute of de velopment that is used to represent the impact of development on a particular type of facility. See Chapter 2 f or a general discussion of demand variables and demand factors. Community and cultural center facilities are intended to serve residents of the C ity, so, population will be used as the demand variable in calculating impact fees for those facilities. Since the fees are based on the added population asso ciated with new residential development, these impact fees will apply only to residential developm ent. Service Area La Quinta’s community and cultural centers serve the entire City, so impact fees for those facilities will apply to all new residential development within the existing corporate boundaries of the La Quinta. Level of Service The level of service standard used to calculate impact fees for community and cultural centers in this chapter is the existing level of service, defined as the City’s current capital investment in those facilities per capita of population. The fees calculat ed in this chapter are designed to maintain that existing level of service as the City grows. 261 City of La Quinta Page 4-2 Development Impact Fee Study August 8, 2019 Existing Facilities Table 4.1 lists the City’s existing community and cultural center facilities and the estimated value of the existing assets associated with those fac ilities, including land, buildings, and furniture, fixtures and equipment . Costs for site improvements such as parking lots and landscaping are included in th e building cost. The City has acquired two sites adjacent to the La Quinta Museum for a Village Ar t Plaza and Promenade, which are programmed for development in the 2020 -21 City budget. The cost of those two sites is included in Table 4.1, but an estimated $3.3 million in future costs for improvements on those sites is not included. The current balance in the Community Center Impact Fee Fund is shown as an existing asset in Table 4.1 and represents additional f acilities that will be constructed with funds t hat have previously been collected from development projects in the City through impact fees. Cost per Capita Table 4.2 calculates an average replacement cost per capita for Community and Cultural Center facilities based on the total impact fee cost bas is from Table 4.1 and the 2019 potential population of the City. See Chapter 2 for a discussion of potential population. Table 4.1: Existing Community and Cultural Center Facilities Cost Building Est Building Est FF&E Site Est Site Impact Fee Component Sq Ft 1 Value 2 Value 3 Acres 4 Value 5 Cost Basis 6 La Quinta Wellness Center 21,900 10,750,000$800,000$2.10 1,372,140$12,922,140$ La Quinta Museum/Historical Society 9,551 4,150,000$1,124,567$0.30 196,020$5,470,587$ Boys and Girls Club Building 5,000 2,200,320$16,018$1.50 980,100$3,196,438$ Village Art Plaza Site (Lumberyard)Actual Purchase Price 526,825$ Promenade Site on Ave Montezuma Actual Purchase Price 509,655$ Community Center Impact Fee Fund Balance 7 149,681$ Total 17,100,320$1,940,585$2,548,260$22,775,326$ 1 Existing square feet from the City of La Quinta Asset Report 2 Estimated building value from City property insurance cost analysis 3 Estimated value of existing furniture, fixtures and equipment (FF&E) from the City property insurance cost analysis and the City asset report 4 Site acres provided by the City of La Quinta 5 Estimated site value based on $653,400 per acre ($15.00 per square foot) 6 Impact fee cost basis = the sum of the amounts for the building, FF&E, and site value. 7 Community Center impact fee fund balance as of 12/31/18 262 City of La Quinta Page 4-3 Development Impact Fee Study August 8, 2019 Impact Fees per Unit of Development Table 4.3 shows the calculation of impact fees per unit of development by development type for community and cultural center facilities. Impact fees per unit are calculated using the impact fee cost per capita from Table 4.2 and population per unit factors from Table 2.1. A small administrative charge is then added to arrive at the adjusted impact fee per unit. The 0.324% administrative charge is intended to recover the cost of this study over five years. It is calculated by dividing the cost of the study b y estimated revenue that would be generated over five years by impact fees calculated in this stu dy (50,000 / 15,455,871 = 0.00324). Projected Revenue Table 4.4 shows projected revenue from the impact fees calculated in this chapter. Potential revenue for the added residential development shown in Tabl e 2.3 is projected by applying the impact fees per unit from Table 4.3 to added units of residential development from Table 2.3. Table 4.2: Community and Cultural Center Facilities - Cost per Capita Total Impact Fee 2019 Potential Impact Fee Cost Cost Basis 1 Population 2 per Capita 3 $22,775,326 64,531 $352.94 1 See Table 4.1 2 See Table 2.2 3 Cost per capita = total impact fee cost basis / 2019 potential population Table 4.3: Community and Cultural Center Facilities - Impact Fees per Unit Development Cost per Population Impact Fee Admin Adj Impact Type Units 1 Capita 2 per Unit 3 per Unit 4 Charge 5 Fee per Unit 6 Residential - Single Family Detached DU 352.94$2.70 952.93$$3.09 $956.02 Residential - Single Family Attached DU 352.94$2.30 811.75$$2.63 $814.38 Residential - Multi-Family/Other DU 352.94$2.20 776.46$$2.52 $778.98 1 Units of development; DU = dwelling unit 2 See Table 4.2 3 See Table 2.1 4 Impact fee per unit = cost per capita X population per unit 5 Administrative charge based on 0.324% of the impact fee per unit; see discussion in text 6 Adjusted impact fee per unit including administrative charge 263 City of La Quinta Page 4-4 Development Impact Fee Study August 8, 2019 Updating the Fees The impact fees calculated in this chapter are based on the current value of Community and Cultural Center facilities. We recommend that the costs used i n this chapter be reviewed periodically and adjusted in the event that updated costs become available. Nexus Summary As discussed in Chapter 1 of this report,Section 66001 of the Mitigation Fee Act requires that an agency establishing, increasing or impo sing impact fees, must make findings to: Identify the purpose of the fee; Identify the use of the fee; and, Determine that there is a reasonable relationship b etween: a.The use of the fee and the development type on which it is imposed; b.The need for the facility and the type of development on which the fee is imposed; and c.The amount of the fee and the facility cost attributable to the development project. Satisfying those requirements also ensures that the fees meet the “rational nexus” and “rough proportionality” standards enunciated in leading court decisions bearing on impact fees and other exactions. (For more detail, see “Legal Framework for Impact F ees” in Chapter 1.) The following paragraphs expla in how the impact fees calculated in this chapt er satisfy those requirements. Purpose of the Fee:The purpose of the impact fees calculated in this chapter is to mitigate the impact of new development on the need for community and cultural center facilitie s in La Quinta. Table 4.4: Community and Cultural Center Impact Fees - Projected Revenue Development Adj Impact Future Projected Type Units 1 Fee per Unit 2 Units 3 Revenue 4 Residential - Single Family Detached DU $956.02 5,186 4,957,895$ Residential - Single Family Attached DU $814.38 743 605,087$ Residential - Multi-Family/Other DU $778.98 946 736,911$ Total 6,299,893$ 1 Units of development; DU = dwelling unit 2 See Table 4.3 3 See Table 2.3 4 Projected revenue = impact fee per unit X future units 264 City of La Quinta Page 4-5 Development Impact Fee Study August 8, 2019 Use of the Fee.Impact fees calculated in this chapter will be used to provide additional community and cultural center facilities to mitigate the impacts of new development in the City. As provided by the Mitigation Fee Act, revenue from impact fees may also be used for temporary loans from one impact fee fund or account to another. Reasonable Relationship between the Use of the Fee and the Development Type o n Which It Is Imposed.The impact fees calculated in this chapter will be used to provide additional community and cultural cente r facilities to serve the needs of additional population associated with new residential development in La Quinta. Reasonable Relationship between the Need for the Facilities and the Type of Development on Which the Fee Is Imposed.New development increase s the need for community and cultural center facilities to maintain the existing level of service, as described earlier in this chapter. Without additional community and cultural center facilities, the increas e in population associated with new residential development would result in a reduction in the level of service provided to all residents of the City. Reasonable Relationship between the Amount of the Fee and the Facility Cost Attributable to the Development Project.The amount of the community and cu ltural center facilities impact fees charged to a residential development project will depend on the increase in population associated with that project.The fees per unit of development calculated in this ch apter for each type of residential development are based on the population per unit for that type of development in La Quinta. Thus, the fee charged to a development project reflects the impact of that project on the need for community and cultural center facilities in the City. 265 City of La Quinta Page 5-1 Development Impact Fee Study August 8, 2019 Chapter 5.Library This chapter calculates impact fees for the La Quinta Library, which is owned by the City of La Quinta and operated by the Riverside County Library System. The existing Library was designe d to serve the projected buildout population of the area within the existing cor porate boundaries of the City. Methodology The method used to calculate impact fees in this chapter is the plan-based method discussed in Chapter 1. That method calculates impa ct fees by allocating the cost of specific facilities to the development served by those facilities.In this case, since the Library is designed to serve a buildout population, new development is effectively buying -in to the existing Library through impact fees. The Library impact fees calculated in this chapter represent new developm ent’s proportionate share of the cost of the existing Library facilities and materials. Demand Variable A demand variable is an attribute of development that is used to repre sent the impact of development on a particular type of facility. See Chapter 2 f or a general discussion of demand variables and demand factors. The La Quinta Library is intended to serve residents of the City, so, population will be used as the demand variable in calculating impact fees for that facility. Since population increase is associated with new residential development, these impact fees will apply only to residential development. Service Area La Quinta’s library serves the entire City, so the library impact fees calculated in this chapter will apply to all new residential development within the existing corporate limits of the City. Level of Service The level of service used in calculating the Library impact fees is the relationship between the cost of existing Library facilities and materials and the projected potential po pulation at buildout of existing and future residential development in the area within La Quinta’s existing corporate boundaries. That relationship is defined by th e cost per capita shown in Table 5.2 on the next page. Existing Facilities Table 5.1 shows the original cost of the existing La Quinta Library building, the building site, the facility’s furniture, fixtures and equipment, and the books and other materials in the library’s 266 City of La Quinta Page 5-2 Development Impact Fee Study August 8, 2019 collection.Costs for site improvements such as parking lots and landscapin g are included in the building cost. Actual interest on the Redevelopment Agency loan used to fund a portion of the cost of the La Quinta Library is also shown in Table 5.1. That interest cost has not been adjusted for inflation, which would have increased the amount. Cost per Capita Table 5.2 calculates an average cost per capita for Library facilities based on the total impact fee cost basis from Table 5.1 and the buildout potential population o f the area within the existing corporate boundaries of the City. Impact Fees per Unit of Development Table 5.3 shows the calculation of impact fees per unit of development by development type for Library facilities and materials. Impact fees per unit ar e calculated using the impact fee cost per capita from Table 5.2 and population per unit factors from Table 2.1 and then adds a small administrative charge to arrive at the adjusted impact fee per unit. The 0.324% administrative charge is intended to recover the cost of this study over five years. It is calculate d by dividing Table 5.1: Existing Library Facility and Materials Cost Building Original Est FF&E Site Original Impact Fee Component Sq Ft 1 Bldg Cost 2 Value 3 Acres 4 Site Cost 5 Cost Basis 6 La Quinta Library Building 20,517 8,500,000$1,025,000 2.40 313,632$9,838,632$ Library Materials (71, 480 volume @ $25.00 each)1,787,000$ Nominal Interest on RDA Library Loan since 2005 435,319$ Total 12,060,951$ 1 Existing square feet from the City of La Quinta Asset Report 2 Building value from City property insurance cost analysis 3 Estimated value of existing furniture, fixtures and equipment (FF&E) from the City property insurance cost analysis and the City asset report 4 Site acres provided by the City of La Quinta 5 Original site cost based on $130,680 per acre ($3.00 per square foot) 6 Impact fee cost basis = the sum of the amounts for the building, FF&E, and site value. Table 5.2: Library Facility and Materials - Cost per Capita Total Impact Fee Buildout Potential Impact Fee Cost Cost Basis 1 Population 2 per Capita 3 $12,060,951 82,323 $146.51 1 See Table 5.1 2 See Table 2.2; see discusion of potential population in Chapter 2 3 Cost per capita = total impact fee cost basis / 2019 potential population 267 City of La Quinta Page 5-3 Development Impact Fee Study August 8, 2019 the cost of the st udy by estimated revenue that would be generated over five years by impact fees calculated in this study (50,000 / 15,455,871 = 0.00324). Projected Revenue Table 5.4 shows projected revenue from the impact fees calculated in this chapter. Potential revenue for the added residential development shown in Table 2.3 is projected by applying the adjusted impact fees per unit from Table 5.3 to added units of residential de velopment from Table 2.3. Construction of the La Quinta Library was funded, in part, by a loan from the City’s Redevelopment Agency (RDA) before the State of California eliminated redevelopment agencies in 2012. That loan is now in the portfolio of the Successor Agency that is responsible for winding down the business of the now-dissolved La Quinta Redevelopment Agency. Impact fees collected for the Library will be used primarily to repay principal and interest on the outstanding debt to the Successor Agency. The impact fees may also be used to pay for library materials. Table 5.3: Library Facility and Materials - Impact Fees per Unit Development Cost per Population Impact Fee Admin Adj Impact Type Units 1 Capita 2 per Unit 3 per Unit 4 Charge 5 Fee per Unit 6 Residential - Single Family Detached DU 146.51$2.70 395.57$$1.28 $396.85 Residential - Single Family Attached DU 146.51$2.30 336.97$$1.09 $338.06 Residential - Multi-Family/Other DU 146.51$2.20 322.32$$1.04 $323.36 1 Units of development; DU = dwelling unit 2 See Table 5.2 3 See Table 2.1 4 Impact fee per unit = cost per capita X population per unit 5 Administrative charge based on 0.324% of the impact fee per unit; see discussion in text 6 Adjusted impact fee per unit including administrative charge Table 5.4: Library Facility and Materials Impact Fees - Projected Revenue Development Adj Impact Future Projected Type Units 1 Fee per Unit 2 Units 3 Revenue 4 Residential - Single Family Detached DU 396.85$5,186 2,058,076$ Residential - Single Family Attached DU 338.06$743 251,178$ Residential - Multi-Family/Other DU 323.36$946 305,900$ Total 2,615,154$ 1 Units of development; DU = dwelling unit 2 See Table 5.3 3 See Table 2.3 4 Projected revenue = impact fee per unit X future units 268 City of La Quinta Page 5-4 Development Impact Fee Study August 8, 2019 There is no set repayment schedule or interest rate for that loan, so it is not possible to estimate the ultimate cost of retiring that debt. The Successor Agency charges interest at th e rate earned by the City’s investment pool, and repayment is based on the availability of impact fee revenue. The current balance on that loan is approximately $1.552 million. The total cost of the facility continues to increases over time because of int erest on the balance of the RDA loan. However, the interest rate being charged on that loan is quite low, and the revenue projected in Table 5.4 appears adequate to cover principal and interest payments until that loan is retired. Based on the rate at whic h Library impact fees have been collected since 2008, full repayment of the RDA loan is likely to take many years. Updating the Fees The impact fees calcu lated in this chapter are based on the original cost of the library facility and those costs are fixed . However, interest on the outstanding loan continues to a ccumulate, so we recommend that these fees be reviewed periodically and adjusted if necessary to reflect actual costs. Nexus Summary As discussed in Chapter 1 of this report,Section 66001 of the Mitigation Fee Act requires that an agency establishing, increasing or imposing impact fees,must make findings to: Identify the purpose of the fee; Identify the use of the fee; and, Determine that there is a reasonable relationship between: a.The use of the fee and the development type on which it is imposed; b.The need for the facility and the type of development on which the fee is imposed; and c.The amount of the fee and the facility cost attributable to the development project. Satisfying those requirements also ensures that the fees meet the “rational nexu s” and “rough proportionality” standards enunciated in leading court decisions bearing on impact fees and other exactions. (For more detail, see “Legal Framework for Impact Fees” in Chapter 1.) The following paragraphs explain how the impact fees calculate d in this chapter satisfy those requirements. Purpose of the Fee:The purpose of the impact fees calculated in this chapter is to pay for new development’s proportionate share of the cost of providi ng library facilities to the residents of La Quinta. 269 City of La Quinta Page 5-5 Development Impact Fee Study August 8, 2019 Use of the Fee.Impact fees calculated in this chapter will be used to repay the Redevelopment Agency loan that was used to fund a portion of the cost of the La Quinta Library and to acquire additional materials for the Library’s collection. As provided by the Mitigation Fee Act, revenue from impact fees may also be used for temporary loans from one impact fee fund or account to another. Reasonable Relationship between the Use of the Fee and the Development Type on Which It Is Imposed.The impact fees calculated in this chapter will be used to retire debt that was used to pay for future development’s share of the cost of the La Quinta Library. Reasonable Relationship between the Need for the Facilities and the Type of Development on Which the Fee Is Imposed.The La Quinta Library was constructed with adequate capacity to serve the anticipated buildout population of the area within the existing City Limits of La Quinta. Those impact fees are imposed on residential development because added residential development drives the growth of the City’s population. Reasonable Relationship between the Amount of the Fee and the Facility Cost A ttributable to the Development Project.The amount of the library impact fe es charged to a residential development project will depend on the increase in population associated with that project. The fees per unit of development calculated in this chapter for each type of residential development are based on the population per un it for that type of development in La Quinta. Thus, the fee charged to a development project reflects that project’s proportionate share of the cost of library facilities in the City. 270 City of La Quinta Page 6-1 Development Impact Fee Study August 8, 2019 Chapter 6.Civic Center This chapter calculates impact fees for the La Quinta Civic Center.When the most recent Civic Center expansion was constructed, the City expected that the expanded facility would have adequate capacity to serve all planned development within the corporate boundaries of the existing City through buildout.However, that expectation has changed as the City began to bring in-house more services that were formerly contracted out. So now, space in the Civic Center is at a premium and additional space will be required as the City continues to grow. Methodology The method used to calculate impact fees in this chapter is the standard-based method discussed in Chapter 1. That method calculates impact fees using a level-of-service standard and the estimated cost of new facilities needed to maintain that standar d.The level of service standard used in this chapter is discussed be low. Demand Variable A demand variable is an attribute of development that is used to represent the impact of development on a particular type of facility. See Chapter 2 for a general d iscussion of demand variables and demand factors. The City departments housed in the Civic Center provide services of one kind or another to all private development in the City, but most of them are not line departments providing services directly to City residents and businesses. In a number of cases, those departments are responsible for management, administrative and support functions essential to City government. It is self-evident that the need for those functions in any city generally increases as th e City grows. But given the variety of functions located in the Civic Center, and the indirect relationship between development and the demand for some of those services, no single attribute of development neatly represents the impact of development on spa ce needs in that facility. Thus, it is reasonable to use a generalize d measure of development to represent service demand for purposes of calculating impact fees for the Civic Center. Acreage is the most common attribute of all types of development, and d eveloped acreage will be used here as the demand variable representin g the impact of development on the need for Civic Center facilities. Service Area La Quinta’s Civic Center serves the entire City, so the Civic Center impact fees calculated in this chapter will apply to all new private development within the existing corporate boundaries of the City. 271 City of La Quinta Page 6-2 Development Impact Fee Study August 8, 2019 Level of Service The level of service standard used to calculate Civic Center impact fees in this chapter is the existing level of service, defined as th e City’s current capital investment in those facilities per developed acre. The fees calculated in this chapter are designed to maintain that existing level of service as the City grows. Existing Facilities Table 6.1 shows the original cost of the existing La Quinta Civic Center building, the building site, and the facility’s furniture, fixtures and equipment.Costs for site improvements such as parking lots and landscaping are included in the building cost. Cost per Developed Acre Table 6.2 on the next page calculates an average cost per developed acre f or the Civic Center using the impact fee cost basis from Table 6.1 and the acreage of existing private development within the corporate boundaries of the City. The developed acreage shown in Table 6.2 excludes public facilities, schools and parks which do not impact the n eed for Civic Center facilities, and includes only 5% of golf course acreage. Golf courses have a very limited impact on the demand for City services housed in the Civic Center. Table 6.1: Existing Civic Center Facility Cost Building Building Est FF&E Site Site Impact Fee Component Sq Ft 1 Cost 2 Value 3 Acres 4 Cost 5 Cost Basis 6 Civic Center 54,553 30,297,716$2,000,000 5.50 718,740$33,016,456$ Total 33,016,456$ 1 Existing square feet from the City of La Quinta Asset Report 2 Original building cost by the City of La Quinta 3 Estimated value of existing furniture, fixtures and equipment from the City property insurance cost analysis and the City asset report 4 Site acres provided by the City of La Quinta 5 Estimated site value based on original costs of $130,680 per acre ($3.00 per square foot) 6 Impact fee cost basis = the sum of the amounts for the building, FF&E, and site value. Table 6.2: Civic Center - Cost per Developed Acre Impact Fee Adjusted Existing Cost per Cost Basis 1 Dev Acreage 2 per Acre 3 $33,016,456 6,597 $5,004.88 1 See Table 6.1 2 Adjusted existsing developed acreage excludes public facilities, schools, parks and includes 5% of golf course acreage; see Table 2.2 3 Cost per acre = impact fee cost basis / adjusted existing developed acreage 272 City of La Quinta Page 6-3 Development Impact Fee Study August 8, 2019 Impact Fees per Unit of Development Table 6.3 shows the calculation of impac t fees per unit of development by development type for the Civic Center. Impact fees per unit are calculated using the impac t fee cost per acre from Table 6.2 and acres-per-unit factors from Table 2.1, except for golf courses which are included at a rate of 0.05 acres per acre of golf course. No impact fees are calculated for public facilities, schools and parks which do not im pact the Civic Center. Table 6.3 also adds a small administrati ve charge to arrive at the adjusted impact fee per unit. The 0.324% administrative charge is intended to recover the cost of this study over five years. It is calculated by dividing the cost of the study by estimated revenue that would be generated over five years by impact fees calculated in this study (50,000 / 15,455,871 = 0.00324). Projected Revenue Table 6.4 shows projected revenue from the impact fees calculated in this chapter. Potentia l revenue for the added private development shown in Table 2.3 is projected by applying the impact fees per unit from Table 6.3 to added units of development from Table 2.3. Table 6.3: Civic Center - Impact Fees per Unit Development Cost per Acres Impact Fee Admin Adj Impact Type Units 1 Acre 2 per Unit 3 per Unit 4 Charge 5 Fee per Unit 6 Residential - Single Family Detached DU 5,004.88$0.245 1,226.20$$3.97 1,230.17$ Residential - Single Family Attached DU 5,004.88$0.222 1,111.08$$3.60 1,114.68$ Residential - Multi-Family/Other DU 5,004.88$0.125 625.61$$2.03 627.64$ Office/Medical KSF 5,004.88$0.104 520.51$$1.69 522.19$ General Commercial KSF 5,004.88$0.104 520.51$$1.69 522.19$ Tourist Commercial/Lodging Room 5,004.88$0.139 695.68$$2.25 697.93$ Public Facilities Acre 0.00$0.270 0.00$$0.00 0.00$ Public Schools Acre 0.00$1.000 0.00$$0.00 0.00$ Parks Acre 0.00$1.000 0.00$$0.00 0.00$ Golf Courses Acre 5,004.88$0.050 250.24$$0.81 251.05$ 1 Units of development; DU = dwelling unit; KSF = 1,000 gross square feet of building area; Room = guest room or suite 2 See Table 6.2 3 Acres per unit; see Table 2.1; for golf courses, the share of acreage impacting the Civic Center is estimated at 5%, so 0.05 acres per acre of golf course is used to calculate the impact fee for golf courses 4 Impact fee per unit = cost per capita X population per unit 5 Administrative charge based on 0.324% of the impact fee per unit; see discussion in text 6 Adjusted impact fee per unit including administrative charge 273 City of La Quinta Page 6-4 Development Impact Fee Study August 8, 2019 Updating the Fees The impact fees calcu lated in this chapter are based largely on the original cost of the Civic Center, and those costs are fixed, so there is no need to review this fee until the City’s next impact fee update. Nexus Summary As discussed in Chapter 1 of this report,Section 66001 of the Mitigation Fee Act requires that an agency establishing, increasing or imposing impact fees,must make findings to: Identify the purpose of the fee; Identify the use of the fee; and, Determine that there is a reasonable relationship between: a.The use of the fee and the development type on which it is imposed; b.The need for the facility and the type of development on which the fee is imposed; and c.The amount of the fee and the facility cost attributable to the development project. Satisfying those requirements also ensures that the fees meet the “rational nexus” and “rough proportionality” standards enunciated in leading court decisions bearing on impact fees and other exactions. (For more detail, see “Legal Framework for Impact Fees” in Chapter 1.) Table 6.4: Civic Center Impact Fees - Projected Revenue Development Adj Impact Future Projected Type Units 1 Fee per Unit 2 Units 3 Revenue 4 Residential - Single Family Detached DU 1,230.17$5,186 6,379,656$ Residential - Single Family Attached DU 1,114.68$743 828,210$ Residential - Multi-Family/Other DU 627.64$946 593,745$ Office/Medical KSF 522.19$512 267,363$ General Commercial KSF 522.19$1,358 709,140$ Tourist Commercial/Lodging Room 697.93$1,360 949,188$ Golf Courses Acre 251.05$817 205,112$ Total 9,932,414$ 1 Units of development; DU = dwelling unit; KSF = 1,000 gross square feet of building area; Room = guest room or suite 2 See Table 6.3 3 See Table 2.3 4 Projected revenue = impact fee per unit X future units 274 City of La Quinta Page 6-5 Development Impact Fee Study August 8, 2019 The following paragraphs explain how the impact fees calculated in this chapter satisfy those requirements. Purpose of the Fee:The purpose of the impact fees calcu lated in this chapter is to pay for new development’s proportionate share of the cost of providing Civic Cente r facilities to serve residents and businesses in La Quinta. Use of the Fee.Impact fees calculated in this chapter will be used to pay for future expansion of the Civic Center. As provided by the Mitigation Fee Act, revenue from impact fees may also be used for temporary loans from one impact fee fund or account to another. Reasonable Relationship between the Use of the Fee and the Development Type on Which It Is Imposed.The impact fees calculated in this chapter will be used for future expansion of the La Quinta Civic Center to meet the needs of additional development in the Ci ty. Reasonable Relationship between the Need for the Facilities and the Type of Development on Which the Fee Is Imposed.The La Quinta Civic Center serves all private development in the City and the need for space in the Civic Center increases as the City grows. Reasonable Relationship between the Amount of the Fee and the Facility Cost Attributable to the Development Project.The amount of the Civic Center impact fees charged to a development project will depend on the amount of added developed acreage a ssociated with that project. The fees per unit of development calcul ated in this chapter for each type of development are based on the estimated a cres per unit for that type of development in La Quinta. Thus, the fee charged to a development project refle cts that project’s proportionate share of the cost of Civic Center facilities in the City. 275 City of La Quinta Page 7-1 Development Impact Fee Study September 23, 2019 Chapter 7.Maintenance Facilities This chapter calculates impact fees for the corporate yard maintenance facilities and equipment needed to serve future development in La Quinta. The impact fees calculated in this chapter are based on the new development’s share of the total cost of existing and planned maintenance facilities including equipment .The City has developed a master plan for future improvements to the m aintenance facilities at the City’s corporate yard. Those improvements are to be added in two phases. The existing facilities are considered Phase I. Future improvements are designated Phase II and Phase III. Methodology The method used to calculate impact fees in this chapter is the plan-based method discussed in Chapter 1.That method calculates impact fees by allocating the cost of specific facilities to the development served by those facilities. In this chapter, separate impact fees will be calculated for the portions of the facilities devoted to its two primary functions:street maintenance and park maintenance. Demand Variable A demand variable is an attribute of development that is used to represent the impact of development on a particular type o f facility. See Chapter 2 for a general discussion of demand variables and demand factors. Because separate impact fees are being calculated for street maintenance facilities and park maintenance facilities, two demand variables are used in this chapter. C osts for park maintenance facilities are allocated using potential population, t he same demand variable used for parks. And costs for street maintenance facilities are allocated using weighted peak hour trips, the same demand variable used for transportati on facilities. Service Area La Quinta’s maintenance facilities serve the entire City, so the impact fees calculated in this chapter will apply to all new development within the existing corporate boundaries of the City. Level of Service For the types of facilities covered in this chapter, level-of-service standards are generally implied rather than explicit. That is, decisions are typically made to build required facilities without formally adopting a standard.The level of service used here to calculate impact fees for maintenance facilities is the level service implied by the relationship of facilities and development at buildout of the area within the existing corporate boundaries of La Quinta. 276 City of La Quinta Page 7-2 Development Impact Fee Study September 23, 2019 Facility Needs Table 7.1 shows the estimated value of the City’s existing corporate yard maintenance facilities, and the estimated cost of future improvements in Phases II and III. The value of existing site improvements such as parking lots and landscaping are included in the value of the existing facilities. Table 7.2 shows a partial list of the City’s existing maintenance equipment . The impact fee cost basis shown in Table 7.2 is the original cost of the equipment, all of which has been purchased in the last two years. City staff estimate that approximately 20% of the City’s maintenance facilities are used for park maintenance and 80% are used for street maintenance. Consequently, in the impact fee Table 7.1: Maintenance Facility Cost Facility Site Est Site Impact Fee Component Value/Cost 1 Acres 2 Value 3 Cost Basis 4 Existing Maintenance Facilities 3,768,443$2.8 1,219,680$4,988,123$ Future Improvements (Phase 2) 3,183,903$3,183,903$ Future Improvements (Phase 3) 4,018,794$4,018,794$ Total 12,190,820$ 1 The value of existing maintenance facilities based on original cost; cost for Phase II improvements from the 2019/20 and 2020/21 CIP; cost for Phase III improvements estimated by the City of La Quinta 2 Site acres provided by the City of La Quinta 3 Estimated site value based on $10.00 per square foot ($435,600 per acre) 4 Impact fee cost basis = the sum of the facility value/cost and site value Table 7.2: Existing Maintenance Equipment Equipment Impact Fee Year Type Make Model Cost Basis 1 2018 Dump Truck Ford F650 88,416$ 2017 Boom Truck Dodge Ram 5500 109,500$ 2018 Backhoe John Deere 310HL 131,640$ 2018 Skid Steer Quinn Cat 232D 44,149$ 2017 Wood Chipper Vermeer 23,000$ 2017 Gator Utility Veh.John Deere 8,600$ 2018 Stump Grinder Vermeer 22,500$ 2018 Dump Trailer (Single Axle)10 Foot 5,700$ 2019 Dump Trailer (Double Axle)10 Foot 7,600$ 2018 Trailer Butler 3,200$ 2019 Trailer Big Tex 16 Foot 3,600$ Total 447,905$ Source: City of La Quinta Facilities Department 1 Impact fee cost basis = original cost 277 City of La Quinta Page 7-3 Development Impact Fee Study September 23, 2019 calculations that follow, 20% of the impa ct fee cost basis for the facilities and equipment will be attributed to park maintenance and 80% will be attributed to street maintenance. Park Maintenance Facilities Cost per Capita Table 7.3 calculates an average cost per capita for the park maintenance share of the City’s maintenance facilities and equipment,based on 20% of the total impact fee cost basis from Tables 7.1 and 7.2,and the City’s projected buildout potential population from Table 2.4. As explained earlier, potential population is the same demand variable used to calculate impact fees for parks in Chapter 3. See Chapter 2 for a discussion of potential population. Street Maintenance Facilities Cost per Weighted Peak Hour Trip Table 7.4 calculates an average cost per weighted peak hour vehicle trip for the street maintenance share of the City’s main tenance facilities and equipment, based on 80% of the total impact fee cost basi s from Tables 7.1 and 7.2,and the City’s projected buildout weighted peak hour trips from Table 2.4. As explained earlier,weighted peak hour trips are also used as the demand variable in calculating street impact fees in Chapter 9.See Chapter 2 for a discussion of weighted peak hour trips. Table 7.3: Park Maintenance Facilities - Cost per Capita Impact Fee Park Maint Park Maint Buildout Cost per Cost Basis 1 Share 2 Cost Basis 3 Potential Pop 4 per Capita 5 $12,638,725 20% $2,527,745 82,323 $30.71 1 Sum of impact fee cost basis from Tables 7.1 and 7.2 2 Share of facilities devoted to park maintenance estimated by the City of La Quinta 3 Park maintenance cost basis = impact fee cost basis X park maintenance share 4 Buildout potential population; see Table 2.4 5 Cost per capita = park maintenance cost basis / buildout potential population Table 7.4: Street Maintenance Facilities - Cost per Weighted Peak Hour Trip Impact Fee Street Maint Street Maint Buildout Wtd Cost per Wtd Cost Basis 1 Share 2 Cost Basis 3 Peak Hour Trips 4 Peak Hour Trip 5 $12,638,725 80% $10,110,980 52,362 $193.10 1 Sum of impact fee cost basis from Tables 7.1 and 7.2 2 Share of facilities devoted to street maintenance estimated by the City of La Quinta 3 Street maintenance cost basis = impact fee cost basis X street maintenance share 4 Buildout weighted peak hour trips; see Table 2.4 5 Cost per weighted peak hour trip = street maintenance cost basis / buildout weighted peak hour trips 278 City of La Quinta Page 7-4 Development Impact Fee Study September 23, 2019 Impact Fees per Unit of Development –Park Maintenance Facilities Table 7.5 shows the calculation of impact fees per unit of development by development type for park maintenance facilities .Impact fees per unit are calculated using the impact fee cost per capita from Table 7.3 and population-per-unit factors from Table 2.1.This portion of the maintenance facilities impact fees will only apply to residential development because population increase is associated with n ew residential development. Table 7.5 also adds a small administrative charge to arrive at the adjusted impact fee per unit. The 0.324% administrative charge is intended to rec over the cost of this study over five years. It is calculated by dividing the co st of the study by estimated revenue that would be generated over five years by impact fees calculated in this study (50,000 / 15,455,871 = 0.00324). Table 7.5: Park Maintenance Facilities - Impact Fees per Unit Development Cost per Population Impact Fee Admin Adj Impact Type Units 1 Capita 2 per Unit 3 per Unit 4 Charge 5 Fee per Unit 6 Residential - Single Family Detached DU 30.71$2.70 82.90$0.27$83.17$ Residential - Single Family Attached DU 30.71$2.30 70.62$0.23$70.85$ Residential - Multi-Family/Other DU 30.71$2.20 67.55$0.22$67.77$ 1 Units of development; DU = dwelling unit 2 See Table 7.3 3 See Table 2.1 4 Impact fee per unit = cost per capita X population per unit 5 Administrative charge based on 0.324% of the impact fee per unit; see discussion in text 6 Adjusted impact fee per unit including administrative charge 279 City of La Quinta Page 7-5 Development Impact Fee Study September 23, 2019 Impact Fees per Unit of Development –Street Maintenance Facilities Table 7.6 shows the calculation of impact fees per unit of development by development type for street maintenance facilities. Impact fees per unit are calculated using the impact fee cost per weighted peak hour trip from Table 7.4 and weighted peak hour trips-per-unit factors from Table 2.1. Table 7.6 also adds a small administrative charge o n the same basis as in Table 7.5. Table 7.6 calculates impact fees for public facilities, schools, and parks, even thou gh the City cannot collect impact fees from those types of development. On the n ext page, costs allocated to public facilities and parks are re -allocated to private development. It is not necessary to reallocate costs from schools. No additional schools ar e planned for the service area defined in this study, so no costs were allocated to schools. In Table 7.7 on the next page , the street maintenance facility costs initially allocate d to public facilities and parks are re -allocated to private development by adjusting the cost per weighted peak hour trip for private development. Reallocation is justified by the fact that the demand associated with public facilities and parks is a secon dary impact of private development, because the need for public facilities and parks is created by private development. Table 7.6: Street Maintenance Facilities - Impact Fees per Unit (Before Reallocation) Development Cost per Wtd Wtd Pk Hr Impact Fee Admin Adj Impact Type Units 1 Pk Hr Trip 2 Trips per Unit 3 per Unit 4 Charge 5 Fee per Unit 6 Residential - Single Family Detached DU 193.10$1.16 223.99$0.73$224.72$ Residential - Single Family Attached DU 193.10$0.89 171.86$0.56$172.41$ Residential - Multi-Family/Other DU 193.10$0.66 127.44$0.41$127.86$ Office/Medical KSF 193.10$1.90 366.89$1.19$368.07$ General Commercial KSF 193.10$2.34 451.85$1.46$453.31$ Tourist Commercial/Lodging Room 193.10$0.54 104.27$0.34$104.61$ Public Facilities KSF 193.10$2.48 478.88$1.55$480.43$ Schools Acre 193.10$0.79 152.55$0.49$153.04$ Parks Acre 193.10$0.51 98.48$0.32$98.80$ Golf Courses Acre 193.10$0.27 52.14$0.17$52.31$ 1 Units of development; DU = dwelling unit; KSF = 1,000 gross square feet of building area; Room = guest room or suite; Acre = net developed acre 2 See Table 7.4 3 See Table 2.1 4 Impact fee per unit = cost per wieghted peak hour trip X weighted peak hour trips per unit 5 Administrative charge based on 0.324% of the impact fee per unit; see discussion in text 6 Adjusted impact fee per unit including administrative charge 280 City of La Quinta Page 7-6 Development Impact Fee Study September 23, 2019 In Table 7.7 above,costs attributed to public facilities are re-allocated to all types of private development while costs attributed to parks are re-allocated only to residential development. Table 7.8 on the next page recalculates the street maintenance impact fees per unit of development for private development using the adjusted cost per weighted peak hour trip for street maintenance facilities from Table 7.7 .Table 7.8 also includes the adjustment for an administrative charge on the same basis as in Tables 7.4 and 7.5.The increase in impact fees resulting from the reallocation amounts to 2.1%for residential development and 1.7% for non- residential development. Table 7.7: Street Maintenance Facilities - Cost per Weighted Peak Hour Trip with Reallocation Initial Cost Reallocated Reallocated Adjusted Development per Weighted Pub Fac Cost per Parks Cost per Cost per Type Units 1 Pk Hr Trip 2 Wtd Pk Hr Trip 3 Wtd Pk Hr Trip 4 Wtd Pk Hr Trip 5 Residential - Single Family Detached DU $193.10 3.25 0.73 197.08$ Residential - Single Family Attached DU $193.10 3.25 0.73 197.08$ Residential - Multi-Family/Other DU $193.10 3.25 0.73 197.08$ Office/Medical KSF $193.10 3.25 196.35$ General Commercial KSF $193.10 3.25 196.35$ Tourist Commercial/Lodging Room $193.10 3.25 196.35$ Public Facilities KSF Reallocated 0.00$ Schools Acre No Allocation 0.00$ Parks Acre Reallocated 0.00$ Golf Courses Acre $193.10 3.25 196.35$ 1 Units of development; DU = dwelling unit; KSF = 1,000 gross square feet of building area; Room = guest room or suite; Acre = net developed acre 2 See Table 7.6 3 Reallocated public facilities cost per weighted peak hour trip = 84 KSF of future Public Facilities X $480.83 per KSF = $40,356.44 / 12,407 weighted peak hour trips for receiving facilities = $3.25 per weighted peak hour trip 4 Reallocated parks cost per weighted peak hour trip = 54 acres of future Parks X $98.80 per acre = $5,335.14 / 7,301 weighted peak hour trips for receiving (residential) development =$0.73 per weighted peak hour trip 281 City of La Quinta Page 7-7 Development Impact Fee Study September 23, 2019 Park Maintenance Facilities Impact Fees -Projected Revenue Table 7.9 shows projected revenue from the park maintenance facilities impact fees calculated in this chapter. Potential revenue is projected by applying the impact fees per unit from Table 7.5 to added units of residential development from Table 2.3. Street Maintenance Facilities Impact Fees -Projected Revenue Table 7.10 shows projected revenue from the street maintenance facilities impact fees calculated in this chapter. Potential revenue is projected by applying the adjusted impact fees per unit from Table 7.8 to added units of development from Table 2.3. Table 7.8: Street Maintenance Facilities - Impact Fees per Unit (After Reallocation) Development Cost per Wtd Wtd Pk Hr Impact Fee Admin Adj Impact Type Units 1 Pk Hr Trip 2 Trips per Unit 3 per Unit 4 Charge 5 Fee per Unit 6 Residential - Single Family Detached DU 197.08$1.16 228.61$0.74 229.35$ Residential - Single Family Attached DU 197.08$0.89 175.40$0.57 175.97$ Residential - Multi-Family/Other DU 197.08$0.66 130.07$0.42 130.49$ Office/Medical KSF 196.35$1.90 373.07$1.21 374.27$ General Commercial KSF 196.35$2.34 459.46$1.49 460.95$ Tourist Commercial/Lodging Room 196.35$0.54 106.03$0.34 106.37$ Public Facilities KSF 0.00$2.48 0.00$0.00 0.00$ Schools Acre 0.00$0.79 0.00$0.00 0.00$ Parks Acre 0.00$0.51 0.00$0.00 0.00$ Golf Courses Acre 196.35$0.27 53.01$0.17 53.19$ 1 Units of development; DU = dwelling unit; KSF = 1,000 gross square feet of building area; Room = guest room or suite; Acre = net developed acre 2 See Table 7.7 3 See Table 2.1 4 Impact fee per unit = cost per wieghted peak hour trip X weighted peak hour trips per unit 5 Administrative charge based on 0.324% of the impact fee per unit; see discussion in text 6 Adjusted impact fee per unit including administrative charge Table 7.9: Park Maintenance Facilities Impact Fees - Projected Revenue Development Adj Impact Future Projected Type Units 1 Fee per Unit 2 Units 3 Revenue 4 Residential - Single Family Detached DU 83.17$5,186 431,333$ Residential - Single Family Attached DU 70.85$743 52,642$ Residential - Multi-Family/Other DU 67.77$946 64,111$ Total 548,086$ 1 Units of development; DU = dwelling unit 2 See Table 7.5 3 See Table 2.3 4 Projected revenue = impact fee per unit X future units 282 City of La Quinta Page 7-8 Development Impact Fee Study September 23, 2019 The combined projected revenue of $3 million for the park maintenance and street maintenance facilities impact fees amounts to approximately 42 % of the estimated $7.2 million cost of future improvements to the City’s maintenance facilities shown in Table 7.1.The balance of the cost will have to come from non-impact fee sources. Updating the Fees The impact fees calculated in this chapter are based in part on estimated costs of futu re maintenance facilities improvements. We recommend that these fees be reviewed periodically and adjusted in the event that up dated costs become available. Nexus Summary As discussed in Chapter 1 of this report,Section 66001 of the Mitigation Fee Act requires that an agency establishing, increasing or imposing impact fees, must make findings to: Identify the purpose of the fee; Identify the use of the fee; and, Determine that there is a reasonable relationship between: a.The use of the fee and the development type on which it is imposed; b.The need for the facility and the type of development on which the fee is imposed; and c.The amount of the fee and the facility cost attributable to the development project. Table 7.10: Street Maintenance Facilities Impact Fees - Projected Revenue Development Adj Impact Future Projected Type Units 1 Fee per Unit 2 Units 3 Revenue 4 Residential - Single Family Detached DU 229.35$5,186 1,189,434$ Residential - Single Family Attached DU 175.97$743 130,746$ Residential - Multi-Family/Other DU 130.49$946 123,448$ Office/Medical KSF 374.27$512 191,629$ General Commercial KSF 460.95$1,358 625,968$ Tourist Commercial/Lodging Room 106.37$1,360 144,667$ Golf Courses Acre 53.19$817 43,453$ Total 2,449,345$ 1 Units of development; DU = dwelling unit; KSF = 1,000 gross square feet of building area; Room = guest room or suite; Acre = net developed acre 2 See Table 7.8 3 See Table 2.3 4 Projected revenue = impact fee per unit X future units 283 City of La Quinta Page 7-9 Development Impact Fee Study September 23, 2019 Satisfying those requirements also ensures that the fees meet the “rational nexus” and “rough proportionality” standards enunciated in leading court decisions beari ng on impact fees and other exactions. (For more detail, see “Legal Framework for Impact Fees” in Chapter 1.) The following paragraphs explain how the impact fees calculated in this chapter satisfy those requirements. Purpose of the Fee:The purpose of the impact fees calculated in this chapter is to pay for new development’s proportionate share of the cost of providing maintenance facilities to serve the City. Use of the Fee.Impact fees calculated in this chapter will be used to pay for additional maintenance facilities needed serve new development in La Quinta . As provided by the Mitigation Fee Act, revenue from impact fees may also be used for temporary loans from one impact fee fund or account to another. Reasonable Relationship between the Use of the Fee and the Development Type o n Which It Is Imposed.The impact fees calculated in this chapter will be used to pay for additional maintenance facilities needed to serve new development in La Quinta. Reasonable Relationship between the Need for the Facilities and the Type of Development on Which the Fee Is Imposed.New development increases the need for parks and streets and the facilities supporting their maintenance. The City’s existing maintenance facilities don ’t have the capacity to support future growth in La Quinta. Reasonable Relationship between the Amount of the Fee and the Facility Cost A ttributable to the Development Project.The amount of the maintenance facilities impact fees charged to a development project will depend on the amount of added potential population and weighted peak hour vehicle trips generated by that project . The fees per unit of development calculated in this chapter for each type of development are based on the estimated increase in potential population and weighted peak hour trips per unit of development . Thus, the fee charged to a development project reflects that project’s proportionate share of the cost of additional maintenance facilities needed to serve new development in the City. 284 City of La Quinta Page 8-1 Development Impact Fee Study August 8, 2019 Chapter 8.Fire Protection This chapter calculates impact fees for La Quinta’s fire protection facilities. The City contracts with the Riverside County Fire Department fo r fire protection, fire prevention, rescue, Fire Marshal and medical emergency services. The City builds and owns the fire stations in La Quinta. Those stations are part of an integrated system of fire protection facilities used by the Riverside County Fire Department to provide fire protection to La Quinta and surrounding communities, including unincorporated portions of the County. There are three existing fire stations in the City and preliminary plans call for a fourth fire station to be constructed in or near the southeastern quadrant of La Quinta. That station will be needed to provide an acceptable level of service to development in that part of the City and in portions of unincorporated Riverside County. This study assumes that the cost of the fourt h fire station will be shared equally between La Quinta and Riverside County. Firefighting apparatus assigned to fire stations in La Quinta is owned by the County. Although the City contributes to the cost of some apparatus through its contract payments to the Riverside County Fire Department, costs for apparatus and vehicles are not included in the cost basis for impact fees in this chapter. Methodology The method used to calculate impact fees in this chapter is the plan-based method discussed in Chapter 1. That method calculates impact fees by allocating the cost of specific facilities to the development served by those facilities.In this case, the cost of existing and future fire stations will be allocated to existing and future development so that all development in the City will share proportionately in the cost of those facilities. The fi re protection impact fees calculated in this chapter represent new development’s proportionate share of the cost of La Quinta’s fire protection facilities. Service Area Although individual fire stations are assigned to provide the initial emergency respo nse in a specific area, resources from multiple f ire stations are often needed to provide an adequate response to an emergency call. A first alarm response to a smal l structure fire can require resources from as many as five fire stations. So it makes sens e to treat the entire City as a single service area for purposes of calculating fire protection impact fees. That approach is further supported by the fact that cal culating separate impact fees for individual fire stations could result in substantially di fferent impact fees for development in different parts of the City receiving essentially the same level of service. This analysis will allocate costs for fire protec tion facilities citywide, so the impact fees for a particular type of development will be t he same throughout the City. 285 City of La Quinta Page 8-2 Development Impact Fee Study August 8, 2019 Level of Service The critical measure of level of service for fire protection and emergency medical services is emergency response time. The number of fire stations needed to serve a particular area with acceptable response times is determined by specific condition s within the area, and is affected heavily by the size of the area to be served. In La Quinta’s case, the City and the Riversi de County Fire Department have determined the number and location of fire stations needed t o provide an acceptable level of service in the City. The impact fee analysis in this chapter is based on the number of fire stations needed to serve the City at bui ldout. Demand Variable A demand variable is an attribute of development that is used t o represent the impact of development on a particular type of facility. See Chapter 2 for a general discussion of demand variables and demand factors. The cost of capital facilities (i.e., fire stations) needed to provide fire protection and emergency medical response services in the City with acceptable response times depends to a large extent on the size of the area to be served. Acreage is the most common measure o f land area, so developed acreage will be used as the demand variable in calculating impact fees for fire protection. Facility Needs Table 8.1 on the next page lists existing and future fire protection facilities in La Quinta, including costs for buildings , fire station sites and furniture fixtures and equipment (FF&E). The impact fee cost basis shown in the right-hand column of Table 8.1 will be used in the impact fee calculations. As indicated above, costs for apparatus and vehicles are not included in th is analysis. 286 City of La Quinta Page 8-3 Development Impact Fee Study August 8, 2019 Cost per Developed Acre Table 8.2 calculates an average cost per developed a cre for fire protection facilities base d on the total impact fee cost basis from Table 8.1 and the projected acreage of development to be served at buildout within t he existing corporate boundaries. The developed acreage shown in Table 8.2 encompasses all development expected within the existing corporate boundaries of the City at buildout, including public facilities, schools, parks and golf courses. However, while parks and golf courses have the potential to create a demand for emergency medical services , they present a very low risk of fires relative to their acreage. Consequently, only 5% of park and golf course acreage is included in the adjusted buildout developed acreage in Table 8.2. Table 8.1: Existing and Future Fire Stations Year Building Est Building Est FF&E Site Est Site Impact Fee Facility Completed Sq Ft 1 Cost/Value 2 Cost/Value 3 Acres 4 Cost/Value 5 Cost Basis 6 Fire Station 32 2009 7,500 3,500,066$100,000$1.2 522,720$4,122,786$ Fire Station 70 1985 5,750 1,298,269$170,000$1.3 566,280$2,034,549$ Fire Station 70 Expansion Future 1,200 480,000$0$0.0 0$480,000$ Fire Station 93 2002 7,690 2,420,350$125,650$1.5 653,400$3,199,400$ Southeast Fire Station 7 Future 7,000 4,550,000$100,000$1.5 653,400$2,651,700$ Total 12,488,435$ 1 Building square feet provided by the City of La Quinta 2 Building value for existing stations from the City property schedule ; building cost for future station based on $650 per square foot including site improvements 3 Value of existing furniture, fixtures and equipment (FF&E) from the City property schedule; estimated cost of FF&E for the future Southeast fire station based on existing stations 4 Site acres provided by the City of La Quinta 5 Cost or value of site estimated based on $10.00 per sq ft ($435,600 per acre) 6 Impact fee cost basis = sum of building, FF&E and site cost or value 7 Impact fee cost basis for Southeast fire station assumes 50% of the cost will be paid by Riverside County Table 8.2: Fire Protection Facilities - Cost per Developed Acre Impact Fee Adjusted Buildout Cost per Cost Basis 1 Dev Acreage 2 per Acre 3 $12,488,435 8,766 $1,424.73 1 See Table 8.1 2 Adjusted buildout developed acreage includes 100% of developed acreage for all other development types and 5% of acreage for parks and golf courses; see Table 2.4 3 Cost per acre = impact fee cost basis / adjusted buildout developed acreage 287 City of La Quinta Page 8-4 Development Impact Fee Study August 8, 2019 Impact Fees per Unit of Development Table 8.3 shows the calculat ion of impact fees per unit of developm ent by development type for the fire protection. Impact fees per unit are calculated using the impact fee cost per acre from Table 8.2 and acres-per-unit factors from Table 2.1, except for parks and golf courses which are included at a rate of 0.05 acres per developed acre. Table 8.3 also adds a small administrative charge to arrive at the adjusted impact fee per unit. The 0.324% administrative charge is intended to recover the cost of this study over five years. It is calculated by dividing the cost of th e study by estimated revenue that would be generated over five years by impact fees calculated in this study (50,000 / 15,455,871 = 0.00324). Note that Table 8.3 calculates impact fees for public facilities, schools,and parks, even though the City cannot collect impact fees from those types of development. On the next page, costs allocated to public facilities and parks are re -allocated to private development. It is not necessary to reallocate costs from schools. No a dditional schools are planned for the service area defined in this study, so no costs were allocated to schools. In Table 8.4 on the next page, the fire protection facilities costs initially allocated to public facilities and parks are re-allocated to private development by adjusting the cost per acre for private development. That reallocation is justified by the fact that the need for public facilities and parks is created by private development. Table 8.3: Fire Protection Facilities - Impact Fees per Unit (Before Reallocation) Development Cost per Acres Impact Fee Admin Adj Impact Type Units 1 Acre 2 per Unit 3 per Unit 4 Charge 5 Fee per Unit 6 Residential - Single Family Detached DU 1,424.73$0.245 349.06$1.13$350.19$ Residential - Single Family Attached DU 1,424.73$0.222 316.29$1.02$317.31$ Residential - Multi-Family/Other DU 1,424.73$0.125 178.09$0.58$178.67$ Office/Medical KSF 1,424.73$0.104 148.17$0.48$148.65$ General Commercial KSF 1,424.73$0.104 148.17$0.48$148.65$ Tourist Commercial/Lodging Room 1,424.73$0.139 198.04$0.64$198.68$ Public Facilities KSF 1,424.73$0.270 384.68$1.25$385.92$ Public Schools Acre 1,424.73$1.000 1,424.73$4.62$1,429.34$ Parks Acre 1,424.73$0.050 71.24$0.23$71.47$ Golf Courses Acre 1,424.73$0.050 71.24$0.23$71.47$ 1 Units of development; DU = dwelling unit; KSF = 1,000 gross square feet of building area; Room = guest room or suite 2 See Table 8.2 3 Acres per unit; see Table 2.1; for parks and golf courses, the share of acreage impacting fire protection facilities is estimated at 5%, so 0.050 acres per acre is used to calculate impact fees for those development types 4 Impact fee per unit = cost per acre X acres per unit 5 Administrative charge based on 0.324% of the impact fee per unit; see discussion in text 6 Adjusted impact fee per unit including administrative charge 288 City of La Quinta Page 8-5 Development Impact Fee Study August 8, 2019 In Table 8.4 above, costs attributed to public facilitie s are re-allocated to all types of priv ate development while costs attributed to parks are re -allocated only to residential development. Table 8.5 on the next page r ecalculates impact fees per unit of development for private development using the adjusted cost per acre for fire protection facil ities from Table 8.4. Table 8.5 also includes the adjustment for an administrative charge on the same basis as in Table 8.3. The increase in impact fees resulting from reallocation amounts to 5.5% for residential development and 1.4% for non-residential development. Table 8.4: Fire Protection Facilities - Cost per Acre with Reallocation Initial Cost Reallocated Reallocated Adjusted Development per Pub Fac Cost Parks Cost Cost per Type Units 1 Acre 2 per Acre 3 per Acre 4 Acre 5 Residential - Single Family Detached DU $1,424.73 20.08 58.13 1,502.93$ Residential - Single Family Attached DU $1,424.73 20.08 58.13 1,502.93$ Residential - Multi-Family/Other DU $1,424.73 20.08 58.13 1,502.93$ Office/Medical KSF $1,424.73 20.08 1,444.80$ General Commercial KSF $1,424.73 20.08 1,444.80$ Tourist Commercial/Lodging Room $1,424.73 20.08 1,444.80$ Public Facilities KSF Reallocated 0.00$ Schools Acre No Allocation 0.00$ Parks Acre Reallocated 0.00$ Golf Courses Acre $1,424.73 20.08 1,444.80$ 1 Units of development; DU = dwelling unit; KSF = 1,000 gross square feet of building area; Room = guest room or suite; Acre = net developed acre 2 See Table 8.3 3 Reallocated public facilities cost per acre = 120 Acres of future Public Facilities X $1,424.73 per acre = = $170.967.60 / 8.516 acres for receiving facilities = $20.08 per acre 4 Reallocated parks cost per acre = 296 acres of future Parks X $1,424.73 per acre = $421,720.08 / 7,255 acres for receiving (residential) development = $58.13 per acre 289 City of La Quinta Page 8-6 Development Impact Fee Study August 8, 2019 Projected Revenue Table 8.6 shows projected revenue from the impact fees calculated in this chapter. Potential revenue for the added private development shown in Table 2.3 is projected by applying the adjusted impact fees per unit from Table 8.5 to added units of development from Table 2.3 Table 8.5: Fire Protection Facilities - Impact Fees per Unit (After Reallocation) Development Cost per Acres Impact Fee Admin Adj Impact Type Units 1 Acre 2 per Unit 3 per Unit 4 Charge 5 Fee per Unit 6 Residential - Single Family Detached DU 1,502.93$0.245 368.22$1.19$369.41$ Residential - Single Family Attached DU 1,502.93$0.222 333.65$1.08$334.73$ Residential - Multi-Family/Other DU 1,502.93$0.125 187.87$0.61$188.47$ Office/Medical KSF 1,444.80$0.104 150.26$0.49$150.75$ General Commercial KSF 1,444.80$0.104 150.26$0.49$150.75$ Tourist Commercial/Lodging Room 1,444.80$0.139 200.83$0.65$201.48$ Public Facilities KSF 0.00$0.270 0.00$0.00$0.00$ Public Schools Acre 0.00$1.000 0.00$0.00$0.00$ Parks Acre 0.00$0.050 0.00$0.00$0.00$ Golf Courses Acre 1,444.80$0.050 72.24$0.23$72.47$ 1 Units of development; DU = dwelling unit; KSF = 1,000 gross square feet of building area; Room = guest room or suite 2 See Table 8.4 3 Acres per unit; see Table 2.1; for parks and golf courses, the share of acreage impacting fire protection facilities is estimated at 5%, so 0.050 acres per acre is used to calculate impact fees for those development types 4 Impact fee per unit = cost per acre X acres per unit 5 Administrative charge based on 0.324% of the impact fee per unit; see discussion in text 6 Adjusted impact fee per unit including administrative charge 290 City of La Quinta Page 8-7 Development Impact Fee Study August 8, 2019 The total impact fee revenue projected in Table 8.4 is about $280,000 less t han the $3.13 million in future facilities costs shown in Table 8.1. So assuming the impact fee revenue projections are reasonably accurate, about 9% of the cost of future fire station improvements would have to come from non -impact fee sources. Updating the Fees The impact fees calcu lated in this chapter are based in part on the cost of existing facilities and in part on the estimated cost of future facilities. Over time those costs can change, so we recommend that these fees be reviewed periodically and adjusted if necessary to reflect actual costs. Nexus Summary As discussed in Chapter 1 of this report,Section 66001 of the Mitigation Fee Act requires that an agency establishing, increasing or imposing impact fees, must make findings to: Identify the purpose of the fee; Identify the use of the fee; and, Determine that there is a reasonable relationship between: a.The use of the fee and the development type on which it is imposed; b.The need for the facility and the type of development on which the fee is imposed; and Table 8.6: Fire Protection Facilities Impact Fees - Projected Revenue Development Adj Impact Future Projected Type Units 1 Fee per Unit 2 Units 3 Revenue 4 Residential - Single Family Detached DU 369.41$5,186 1,915,765$ Residential - Single Family Attached DU 334.73$743 248,706$ Residential - Multi-Family/Other DU 188.47$946 178,297$ Office/Medical KSF 150.75$512 77,182$ General Commercial KSF 150.75$1,358 204,713$ Tourist Commercial/Lodging Room 201.48$1,360 274,010$ Golf Courses Acre 72.47$817 59,211$ Total 2,957,885$ 1 Units of development; DU = dwelling unit; KSF = 1,000 gross square feet of building area; Room = guest room or suite; acre = net acre 2 See Table 8.5 3 See Table 2.3 4 Projected revenue = impact fee per unit X future units 291 City of La Quinta Page 8-8 Development Impact Fee Study August 8, 2019 c.The amount of the fee and the facility cost attributable to the developmen t project. Satisfying those requirements also ensures that the fees meet the “rational nexus” and “rough proportionality” standards enunciated in leading court deci sions bearing on impact fees and other exactions. (For more detail, see “Legal Framework fo r Impact Fees” in Chapter 1.) The following paragraphs explain how the impact fees calculated in this chapter satisfy those requirements. Purpose of the Fee:The purpose of the impact fees calculated in this chapter is to pay for new development’s proportionate share of the cost of pr oviding fire protection facilities to serve development in La Quinta. Use of the Fee.Impact fees calculated in this chapter will be use d to pay for future fire protection facilities needed to provide a reasonable level of cove rage for the City. As provided by the Mitigation Fee Act, revenue from impact fees may also be used for temporary loans from one impact fee fund or account to anot her. Reasonable Relationship between the Use of the Fee and the Development Type o n Which It Is Imposed.The impact fees calculated in this chapter will be used to pay for new development’s proportional sh are of the fire protection facilities needed to ser ve all development in La Quinta. Reasonable Relationship between the Need for the Facilities and the Type of Development on Which the Fee Is Imposed.The impact fees calculated in this chapter will pay for additional fire protection facilities needed serve anticipated development through buildout of the area within the existing corporate boundar ies of La Quinta. Reasonable Relationship between the Amount of the Fee and the Facility Cost A ttributable to the Development Project.The amount of the fire protection impact fees charged to a development project will depend on the amount of added develo ped acreage associated with that project. The fees per unit of development calculated in this chapter for each ty pe of development are based on the estimated acres per unit for that type of development in La Quinta. Thus, the fee charged to a development project reflects that project’s proportionate share of the cost of fire protection facilities in the City. 292 City of La Quinta Page 9-1 Development Impact Fee Study August 8, 2019 Chapter 9.Transportation This chapter calculates impact fees for improvements to La Quinta’s transportation system, including arterial streets, medians, roun dabouts,traffic signals,bridges, bike lanes and sidewalks. Information on transportation infrastructure needs and costs is taken from the City of La Quinta 2018 Transportation Infrastructure Needs Analysis by NAI Consulting , as revised August 5, 2019. That study assigns shares of the cost of each improvement to impact fees and to various other funding sources. It is important to note that the California Complete Streets Act requires local governments in the state to address the transportation needs of all users, including pedestrians, cyclists and transit riders. Methodology The method used to calculate impact fees in this chapter is the plan-based method discussed in Chapter 1. That method calculates impact fees by allocating the cost of specific facilit ies to the development served by those facilities. In this case, costs for improvements that increase the traffi c-carrying capacity of streets and are not funded from other sources are allocated to future development (see Table 9.1). Costs for improvements such as sidewalks and bike lanes that do not increase the traffic -carrying capacity of streets and are not fund ed from other sources are allocated propo rtionately to existing and future development (see Table 9.2). Service Area The service area for La Quinta’s transportation system, as defined in the 2018 Transportation Infrastructure Needs Analysis is the area within the existing corporate boundaries of the City. Level of Service The improvement needs identified in the 2018 Transportation Infrastruc ture Needs Analysis are based on level of service standards adopted in the Circulation Element of the La Quinta 2 035 General Plan. Demand Variable A demand variable is an attribute of development that is used to represent the impact of development on a particular type of facility. See Chapter 2 for a general discussion of demand variables and demand factors. The demand variable used in this analysis is weighted peak hour trips, which is the product of peak hour trips per unit and a trip length factor representing the relationship between the average trip length for a particular development type and the system -wide average trip length . See Chapter 2 for a detailed discussion of weighted peak hour trips. 293 City of La Quinta Page 9-2 Development Impact Fee Study August 8, 2019 Improvement Needs Tables 9.1 and 9.2 summarize the improvement costs identified in the 2018 La Quinta Transportation Infrastructure Needs Analysis by type. Table 9 .1 shows a breakdown of costs by type of improvement and funding source for capacity -enhancing improvements. Table 9.2 shows a similar breakdown for non-capacity-enhancing improvements. Note that in both of those tables, there is an item titled “Remaining Balance on Reimbursement Agreements.”Those items refer to amounts the City has committed to repay developers for improvements those developer s have constructed in excess of the amount for which they were responsible, and for which the City has agreed to reimburse them from impact fees collected from future development that shares responsibility for the improvements in question. The City share of costs from Table 9.1 is allocated in this analysis to future development based on weighted peak hour trips. The City share of costs from Table 9.2 is allocated in this analysis to both existing and future development based on weighted peak hour trips. Cost per Weighted Peak Hour Trip Table 9.3 calculates an average cost per weighted peak hour trip based on the City share of costs for capacity-enhancing improvements from Table 9.1 and the number of weighted peak hour trips associated with future development in Table 2.3.Weighted peak hour trips are discussed in Chapter 2. Table 9.1: Transportation System Capacity- Enhancing Improvements Improvement City Cost Developer Hwy Bridge Total Category Share Contribution TUMF Program Cost New Roadway Construction 2,376,019$664,160$3,040,179$ Roadway Improvements - Capacity Enhancing) 11,996,238$20,708,470$4,481,320$37,186,028$ Structure Improvements 4,259,250$7,188,750$12,442,000$23,890,000$ New Roundabouts 8,656,500$1,791,000$9,850,500$20,298,000$ New Traffic Signals 1,290,000$967,500$2,257,500$ Remaining Balance on Reimbursement Agreements 2,288,591$2,288,591$ Total 30,866,598$24,131,130$21,520,570$12,442,000$88,960,298$ Source: 2018 La Quinta Transportation Infrastructure Needs Analysis, Revised 8/5/19 Table 9.2: Transportation System Non Capacity- Enhancing Improvements Improvement City Cost Developer Hwy Bridge Total Category Share Contribution TUMF Program Cost Roadway Improvements - Non-capacity Enhancing) 29,575,145$4,628,855$34,204,000$ Median-Only Improvements 3,346,000$3,346,000$ Sidewalk-Only Improvements 5,882,691$904,309$6,787,000$ Bike Lane-Only Improvements 8,644,000$8,644,000$ Remaining Balance on Reimbursement Agreements 1,451,133$1,451,133$ Total 48,898,969$5,533,164$0$0$54,432,133$ Source: 2018 La Quinta Transportation Infrastructure Needs Analysis 294 City of La Quinta Page 9-3 Development Impact Fee Study August 8, 2019 Table 9.4 calculates an average cost per weighted peak hour trip based on the C ity share of costs for non-capacity-enhancing improvements from Table 9.2 and the number of weighted peak hour trips associated with both existing and future development in Table 2.4. Impact Fees per Unit of Development Table 9.5 shows the initial calcu lation of impact fees per unit of development by development type for the transportation improvements.These impact fees per unit are cal culated using the sum of the cost per weighted peak hour trip from Tables 9.3 and 9.4, and the weighted peak hour trips-per-unit factors from Table 2.1. Table 9.5 also adds a small administrative charge to arrive at the a djusted impact fee per unit. The 0.324% administrative charge is intended to recover the cost of this study over five years. It is calculated by dividing the cost of the study by estimated revenue that would be generated over five years by impact fees calculated in this study (50,000 / 15,455,871 = 0.00324). Note that Table 9.5 calculates impact fees for public facilities, schools and parks even though the City cannot collect fees for those types of development. On the next page, costs allocated to public facilities and parks are re-allocated to private development. It is not necessary to reallocate costs from schools. No additional schools are planned for t he service area defined in this study, so no costs were allocated to schools. Table 9.3: Capacity Enhancing Improvements - Cost per Wtd Pk Hr Trip City Cost Added Weighted Cost per Weighted Share 1 Peak Hour Trips 2 Peak Hour Trip 3 $30,866,598 12,643 $2,441.40 1 See Table 9.1 2 See Table 2.3 3 Cost per weighted peak hour trip = impact fee cost basis / added weighted peak hour trips Table 9.4: Non-Capacity-Enhancing Improvements - Cost per Wtd Pk Hr Trip City Cost Buildout Weighted Cost per Weighted Share 1 Peak Hour Trips 2 Peak Hour Trip 3 $48,898,969 52,362 $933.86 1 See Table 9.2 2 See Table 2.4 3 Cost per weighted peak hour trip = impact fee cost basis / buildout weighted peak hour trips 295 City of La Quinta Page 9-4 Development Impact Fee Study August 8, 2019 In Table 9.6, the costs initially allocated to public facilities and parks based on traffic generated by those uses, are reallocated to private development. That reallocation i s justified by the fact that the need for public facilities and parks is created by private developmen t. Table 9.5: Transportation Improvements - Impact Fees per Unit (Before Reallocation) Development Cost per Wtd Wtd Pk Hr Impact Fee Admin Adj Impact Type Units 1 Pk Hr Trip 2 Trips per Unit 3 per Unit 4 Charge 5 Fee per Unit 6 Residential - Single Family Detached DU 3,375.26$1.16 3,915.30$12.69$3,927.99$ Residential - Single Family Attached DU 3,375.26$0.89 3,003.98$9.73$3,013.72$ Residential - Multi-Family/Other DU 3,375.26$0.66 2,227.67$7.22$2,234.89$ Office/Medical KSF 3,375.26$1.90 6,413.00$20.78$6,433.78$ General Commercial KSF 3,375.26$2.34 7,898.11$25.59$7,923.70$ Tourist Commercial/Lodging Room 3,375.26$0.54 1,822.64$5.91$1,828.55$ Public Facilities KSF 3,375.26$2.48 8,370.65$27.12$8,397.77$ Schools Acre 3,375.26$0.79 2,666.46$8.64$2,675.10$ Parks Acre 3,375.26$0.51 1,721.38$5.58$1,726.96$ Golf Courses Acre 3,375.26$0.27 911.32$2.95$914.27$ 1 Units of development; DU = dwelling unit; KSF = 1,000 gross square feet of building area; Room = guest room or suite; Acre = net developed acre 2 Sum of costs per weighted peak hour trip from Table 9.3 and Table 9.4 3 See Table 2.1 4 Impact fee per unit = cost per weighted peak hour trip X weighted peak hour trips per unit 5 Administrative charge based on 0.324% of the impact fee per unit; see discussion in text 6 Adjusted impact fee per unit including administrative charge Table 9.6: Transportation Improvements - Cost per Weighted Peak Hour Trip with Reallocation Initial Cost Reallocated Reallocated Adjusted Development per Weighted Pub Fac Cost per Parks Cost per Cost per Type Units 1 Pk Hr Trip 2 Wtd Pk Hr Trip 3 Wtd Pk Hr Trip 4 Wtd Pk Hr Trip 5 Residential - Single Family Detached DU $3,375.26 56.67 12.73 3,444.67$ Residential - Single Family Attached DU $3,375.26 56.67 12.73 3,444.67$ Residential - Multi-Family/Other DU $3,375.26 56.67 12.73 3,444.67$ Office/Medical KSF $3,375.26 56.67 3,431.93$ General Commercial KSF $3,375.26 56.67 3,431.93$ Tourist Commercial/Lodging Room $3,375.26 56.67 3,431.93$ Public Facilities KSF Reallocated 0.00$ Schools Acre No Allocation 0.00$ Parks Acre Reallocated 0.00$ Golf Courses Acre $3,375.26 56.67 3,431.93$ 1 Units of development; DU = dwelling unit; KSF = 1,000 gross square feet of building area; Room = guest room or suite; Acre = net developed acre 2 See Table 9.5 3 Reallocated public facilities cost per weighted peak hour trip = 84 KSF of future Public Facilities X $8,370.65 per KSF = $703,144.56 / 12,407 weighted peak hour trips for receiving facilities = $56.67 per weighted peak hour trip 4 Reallocated parks cost per weighted peak hour trip = 54 acres of future Parks X $1,721.38 per acre = $92,954.71 / 7,301 weighted peak hour trips for receiving (residential) development =$12.73 per weighted peak hour trip 296 City of La Quinta Page 9-5 Development Impact Fee Study August 8, 2019 In Table 9.6, above, public facilities costs are reallocated to all types of private development while parks costs are reallocated only to residenti al development that creates the need for parks. Table 9.7 recalculates the impact fees per unit of de velopment using the adjusted cost p er weighted peak hour trip for each type of development after reallocation.It is worth noting that the increase in impact fees for private development resulting from reallocation is very small on a percentage basis,about 2.1 % for residential development and 1.7% for non-residential development. Projected Revenue Table 9.8 on the next page shows projected revenue from the impact fees calculated in this chapter. Potential revenue for the added private development shown in Table 2.3 is projected by applying the impact fees per unit from Table 9.7 to added units of development from Table 2.3. Table 9.7: Transportation Improvements - Impact Fees per Unit (After Reallocation) Development Adj Cost/Wtd Wtd Pk Hr Impact Fee Admin Adj Impact Type Units 1 Pk Hr Trip 2 Trips per Unit 3 per Unit 4 Charge 5 Fee per Unit 6 Residential - Single Family Detached DU 3,444.67$1.16 3,995.81$12.95 4,008.76$ Residential - Single Family Attached DU 3,444.67$0.89 3,065.75$9.93 3,075.69$ Residential - Multi-Family/Other DU 3,444.67$0.66 2,273.48$7.37 2,280.85$ Office/Medical KSF 3,431.93$1.90 6,520.68$21.13 6,541.80$ General Commercial KSF 3,431.93$2.34 8,030.73$26.02 8,056.75$ Tourist Commercial/Lodging Room 3,431.93$0.54 1,853.24$6.00 1,859.25$ Golf Courses Acre 3,431.93$0.27 926.62$3.00 929.62$ 1 Units of development; DU = dwelling unit; KSF = 1,000 gross square feet of building area; Room = guest room or suite; Acre = net developed acre 2 See Table 9.6 3 See Table 2.1 5 Administrative charge based on 0.324% of the impact fee per unit; see discussion in text 6 Adjusted impact fee per unit including administrative charge 297 City of La Quinta Page 9-6 Development Impact Fee Study August 8, 2019 The total impact fee revenue projected in Table 9.8 represents approximately 5 4% of the City’s share of the total cost of transpo rtation improvements shown in the 2018 Transportation Infrastructure Needs Analysis. Updating the Fees The impact fees calculated in this chapter are based on cost estimates in the 2018 Transportation Infrastructure Needs Analysis. We recommend that these fees be reviewed periodically and adjusted when updated costs become available. Nexus Summary As discussed in Chapter 1 of this report,Section 66001 of the Mitigation Fee Act requires that an agency establishing, increasing or imposing impact fees, must make findings to: Identify the purpose of the fee; Identify the use of the fee; and, Determine that there is a reasonable relationship between: a.The use of the fee and the development type on which it is imposed; b.The need for the facility and the type of development on which the fee is imposed; and c.The amount of the fee and the facility cost attributable to the development project. Table 9.8: Transportation Impact Fees - Projected Revenue Development Adj Impact Future Projected Type Units 1 Fee per Unit 2 Units 3 Revenue 4 Residential - Single Family Detached DU 4,008.76$5,186 20,789,425$ Residential - Single Family Attached DU 3,075.69$743 2,285,235$ Residential - Multi-Family/Other DU 2,280.85$946 2,157,680$ Office/Medical KSF 6,541.80$512 3,349,403$ General Commercial KSF 8,056.75$1,358 10,941,061$ Tourist Commercial/Lodging Room 1,859.25$1,360 2,528,579$ Golf Courses Acre 929.62$817 759,503$ Total 42,810,885$ 1 Units of development; DU = dwelling unit; KSF = 1,000 gross square feet of building area; Room = guest room or suite; Acre = net developed acre 2 See Table 9.7 3 See Table 2.3 4 Projected revenue = impact fee per unit X future units 298 City of La Quinta Page 9-7 Development Impact Fee Study August 8, 2019 Satisfying those requirements also ensures that the fees meet the “rational nexus” and “rough proportionality” standards enunciated in leading court decisions bearing on impact fees and other exactions. (For more detail, see “Legal Framework for Impact Fees” in Chapter 1.) The following paragraphs explain how the impact fees calculated in this chapter satisfy those requirements. Purpose of the Fee:The purpose of the impact fees calculated in this chapter is to pay for new development’s proportionate share of the cost of p roviding transportation improvements to serve development in La Quinta. Use of the Fee.Impact fees calculated in this chapter will be used to pay for transportation facilities shown in the City’s 2018 Transportation Infrastructure Needs Analysis , as revised August 5, 2019,and to reimburse developers for improvement costs expended for the benefit of future development. As provided by the Mitigation Fee Act, revenue from impact fees may also be used for temporary loans from one impact fee fund or account to another. Reasonable Relationship between the Use of the Fee and the Development Type o n Which It Is Imposed.The impact fees calculated in this chapter will be used to pay for new development’s proportional share of the transportation improvements neede d to serve all development in La Quinta. Reasonable Relationship between the Need for the Facilities and the Type of Development on Which the Fee Is Imposed.Additional demand created by new development necessitates the construction of improvements to the City’s transportation system. The impact fees calculated in this chapter will pay for a portion of tho se improvements. Reasonable Relationship between the Amount of the Fee and the Facility Cost A ttributable to the Development Project.The amount of the transportation impact fees charged to a development project will depend on the amount of peak hour added traffic associated with that project. The fees per unit of development calculated in this chapter for each type of development are based on the estimated weighted peak hour trips associated with that type of development in La Quinta. Thus, the fee charge d to a development project reflects that project’s proportionate share of the cost of new transportation facilities in the City. 299 City of La Quinta Page 10-1 Development Impact Fee Study August 8,2019 Chapter 10.Implementation This chapter of the report contains recommendations for adoption and administration of impact fees, and for th e interpretation and application of the development impact fees and in - lieu fees calculated in this study. It was not prepared by an attorney and is not intended as legal advice. Statutory requirements for the adoption and administration of fees imposed a s a condition of development approval (impact fees) are found in the Mitigation Fee Act (Government Code Sections 66000 et seq.). Requirements for park land dedication and fees in lieu of dedication are governed by the Quimby Act (Government Code 66477). Adoption The form in which development impact fees are enacted should be determined by the City attorney. The specific requirements are diff erent for impact fees under the Mitigation Fee Act, and for park land dedication and in -lieu fees under the Quimby Act. The latter requirements must be adopted by ordinance, and are subject to the same noticing and public hearing procedures as any ordinance. Procedures for adoption of fees subject to the Mitigation Fee Act, including notice and public hearing requirements, are specified in Government Code Sections 66016 and 66018. It should be noted that Section 66018 refers to Government Code Section 6062 a, which requires that the public hearing notice be published at least twice during the 10 -day notice period. Government Code Section 66017 provides that fees subject to the Mitigation Fee Act do not become effective until 60 days after final action by th e governing body. Actions establishing or increasing fees subject to the Mitigation Act require certain findings , as set forth in Government Code Section 66001 and discussed below and in Chapter 1 of this report. Establishment of Fees. Pursuant to the Mitigation Fee Act, Section 66001(a), when an agency establishes fees to be imposed as a condition of development approval,it must make findings to: 1.Identify the purpose of the fee; 2.Identify the use of the fee; and 3.Determine how there is a re asonable relationship between: a.The use of the fee and the type of development project on which it is imposed; b.The need for the facility and the type of development project on which the fee is imposed 300 City of La Quinta Page 10-2 Development Impact Fee Study August 8,2019 Examples of findings that could be used for impact fees calculated in this study are shown below. The specific language of such findings should be reviewed and approved by the agency’s Attorney.A more complete discussion of the nexus for each fee can be found in individual chapters of this report. Sample Finding:Purpose of the Fee.The City Council finds that the purpose of the impact fees hereby enacted is to protect the public health, safety and welfare by requiring new development to contribute to the cost of park and recreation improvements needed to mitigate the impacts of new development . Sample Finding: Use of the Fee.The City Council finds that revenue from the impact fees hereby enacted will be used to provide public facilities needed to mitigate the impacts of new development in the City and identified in the 2019 City of La Quinta Development Impact Fee Study by NBS.1 Sample Finding: Reasonable Relationship:Based on analysis presented in the 2019 City of La Quinta Development Impact Fee Study by NBS, the City Council finds that there is a reasonable relationship between: a.The use of the fees and the types of development projects on which they are imposed; and, b.The need for facilities and the types of development projects on which the fees are imposed. Administration The California Mitigation Fee Act (Government Code Sections 66000 et seq.) mandates procedures for administration of impact fee programs, including collection and accounting, reporting, and refunds. References to code sections in the following paragraphs pertain to the California Government Code. Imposition of Fees. Pursuant to the Mitigation Fee Act , Section 66001(a), when an agency imposes an impact fee upon a specific development project, it must make essentially the same findings adopted upon establishment of the fees to: 1.Identify the purpose of the fee; 2.Identify the use of the fee; and 3.Determine how there is a reasonable relationship between: a.The use of the fee and the type of development project on which it is imposed; 1 According to Gov’t Code Section 66001 (a) (2), the use of the fee may be specified in a capital improvement plan, the General Plan, or other public documents that identify the public facilities for which the fee is charged. The findings recommended here identify this impact fee study as the source of that inf ormation. 301 City of La Quinta Page 10-3 Development Impact Fee Study August 8,2019 b.The need for the facility and the type of development project on which the fee is imposed Per Section 66001 (b), at th e time when an impact fee is imposed on a specific development project, the City is also required to make a finding to determine how there i s a reasonable relationship between: c.The amount of the fee and the facility cost attributable to the development project on which it is imposed. In addition, Section 66006 (f)provides that a local agency, at the time it imposes a fee for public improvements on a specific development project, "... shall identify the public improvement that the fee will be used to finance."The required notification could refer to the improvements identified in this study. Section 66020 (d) (1) requires that the agency, at the time it imposes an impact fee ,provide a written statement of the amount of the fee and written notice o f a 90-day period during which the imposition of the fee can be protested. Failure to protest imposition of the fee during that period may deprive the fee payer of the right to subsequent legal challenge. Section 66022 (a)provides a separate procedure for challenging the establishment of an impact fee. Such challenges must be filed within 120 days of enactment. Collection of Fees.Section 66007 (a), provides that a local agency shall not require payment of fees by developers of residential projects pr ior to the date of final inspection, or issuance of a certificate of occupancy, whichever occurs first. However, "utility service fees" (not defined) may be collected upon ap plication for utility service.In a residential development project of more than one dwelling unit,Section 66007 (a) allows the agency to choose to collect fees either for individual units or for phases upon final inspection, or for the entire project upon final inspection of the first dwelling unit completed. Section 66007 (b) provides two exceptions when the local agency may require the payment of fees from developers of residential projects at an earlier time: (1) whe n the local agency determines that the fees “will be collected for public improvements or facilities for which an account has been established and funds appropriated and for which the local agency has adopted a proposed construction schedule or plan prior to final inspection or issuance of the certificate of occupancy” or (2) the fees are “to reimburse the local agency for expenditures previously made.” Statutory restrictions on the time at which fees may be collected do not apply to non - residential development. Notwithstanding the foregoing restrictions, many cities routinely collect impact fees for all facilities at the time building or grading permits are issued and builders often find it convenient to pay the fees at that time. 302 City of La Quinta Page 10-4 Development Impact Fee Study August 8,2019 In cases where the fees are not collected upon issuance of building permits ( of grading permits for golf courses), Sections 66007 (c) (1)and (2) provide that the City may require the property owner to execute a contract to pay the fee, and to record that contract as a lien ag ainst the property until the fees are paid. Earmarking and Expenditure of Fee Revenue.Section 66006 (a)mandates that fees be deposited “with other fees for the impro vement in a separate capital facilities account or fund in a manner to avoid any commingling of the fees with other revenues and funds of the local agency, except for temporary investments , and expend those fees solely for the purpose for which the fee was colle cted.”Section 66006 (a) also requires that interest earned on the fee revenues be placed in the capital account and used for the same pur pose. The language of the law is not clear as to whether depositing fees "with other fees for the improvement" refers to a specific capital improvement or a class of improvements (e.g., street improvements). We are not aware of any municipality that has interpreted that language to mean that funds must be segregated by individual projects. And, as a practical matter,that approach would be unworkable in any event because it would mean that no pay-as-you-go project could be constructed until all benefiting development had paid the fees. Common practice is to maintain separate funds or accounts for impact fee revenues b y facility category (i.e., streets, park improvements), but not for individual proj ects. Impact Fee Exemptions, Reductions, and Waivers . In the event that a development project is found to have no impact on facilities for which impact fees are charged,such project must be exempted from the fees. If a project has characteristics that will make its impacts on a particular public facility or infrastructure system significantly and permanently sma ller than the average impact used to calculate impact fees in this study, the fees should be reduced accordingly.Per Section 66001 (b), there must be a reasonable relationship between the amount of the fee and the cost of the public facility attributable to the development on which the fee is imposed. The fee reduction is required if the fee is not proportional to the impact of the developme nt on relevant public facilities. In some cases, the agency may desire to voluntarily waive or reduce impact fees that would otherwise apply to a project as a way of promoting goals such as affordable housing or economic development. Such a waiver or redu ction may not result in increased costs to other development projects,so the effect us such policies is that the lost revenue must be made up from other fund sources. Credit for Improvements Provided by Developers. If the City requires a developer,as a condition of project approval,to dedicate land or construct facilities or improvements for which impact fees are charged,the City should ensure that the impact fees are ad justed so that the overall contribution by the developer does not exceed the impact created by the development. 303 City of La Quinta Page 10-5 Development Impact Fee Study August 8,2019 In the event that a developer voluntarily offers to dedicate land,or construct facilities or improvements in lieu of paying impact fees, the City may accept or reject such offers, and may negotiate the terms under which such an offer would be accepted. Excess contributions by a developer may be offset by reimbursement agreements . Credit for Existing Development.If a project involves replacement, redevelopment or intensification of previously existing development, impact fe es should be applied only to the portion of the project that represents a net increase in demand for relevant City facilities, applying the measure of demand used in this study to calculate that particular impact fee. Annual Report.Section 66006 (b) (1)requires that once each year, within 180 days of the close of the fiscal year, the local agency must make availa ble to the public the following information for each separate account established to receive impact fee revenues: 1.A brief description of the type of fee in the account or fund; 2.The amount of the fee; 3.The beginning and ending balance of the account or fund; 4.The amount of the fees collected and interest earned; 5.Identification of each public improvement on which fees were expended and the amount of the expenditures on each improvement, including the percentage of the cost of the public improvement that was funded with fees; 6.Identification of the approximate date by which the construction of a public improvement will commence, if the City determine s sufficient funds have been collected to complete financing of an incomplete public improvement; 7.A description of each inter-fund transfer or loan made from the account or fund, including interest rates, repayment dates, and a description of the improveme nt on which the transfer or loan will be expended; 8.The amount of any refunds or allocations made pursuant to Secti on 66001, paragraphs (e) and (f). The annual report must be reviewed by the City Council at its next regularly scheduled public meeting, but not less than 15 days after the statements are made public , per Section 66006 (b) (2). Refunds under the Mitigation Fee Act. Prior to 1996,The Mitigation Fee Act required that a local agency collecting impact fees was required to ex pend or commit impact fee revenue within five years,or make findings to justify a continued need for the money. Otherwise, those funds had to be refunded. SB 1693, adopted in 1996 as an amendment to the Mitigation Fee Act,changed that requirement in material ways. Now, Section 66001 (d)requires that, for the fifth fiscal year following the first deposit of any impact fee revenue into an account or fund as required by Section 66006 (b), and every five 304 City of La Quinta Page 10-6 Development Impact Fee Study August 8,2019 years thereafter, the local agency shall make all of the following find ings for any fee revenue that remains unexpended, whether committed or uncommitted: 1.Identify the purpose to which the fee will be put; 2.Demonstrate the reasonable relationship between the fee and the purpose for which it is charged; 3.Identify all sources and amounts of funding anticipated to complete financing of incomplete improvements for which impact fees are to be used; 4.Designate the approximate dates on which the funding necessary to complete financing of those improvements will be deposited into the appropriate account or fund. Those findings are to be made in conjunction with the annual reports discussed above . If such findings are not made as required by Section 66001, the local agency could be required to refund the moneys in the account or fund ,per Section 66001 (d). Once the agency determines that sufficient funds have been collected to complete financing on incomplete improvements for which impact fee revenue is to be used, it must, within 180 days of that determination, identify an approxim ate date by which construction of the public improvement will be commenced (Section 66001 (e)). If the agency fails to comply with that requirement, it must refund impact fee revenue in the account according to proc edures specified in Section 66001 (d). Refunds under the Quimby Act.The Quimby Act, Section a.(6)(A) requires that a City, County or other agency to which park land or in-lieu fees are conveyed or paid shall develop a schedule “specifying how, when and where it will use the land or fees or both to develop park or recreational facilities to serve residents of the subdivision…. Any fees collected under the ordinance shall be committed within five ye ars after the payment of the fees or the issuance of building permits on one-half of the lots created by the subdivision, whichever occurs later. Any fees not committed within five years must be refunded. Annual Update of the Capital Improvement Plan . Section 66002 (b) of the Mitigation Fee Act provides that if a local agency adopts a capital improvemen t plan to identify the use of impact fees, that plan must be adopted and annually updated by a resolution of the g overning body at a noticed public hearing.The alternative, per Section 66001 (a) (2)is to identify improvements by applicable general or specific plans or in other public documents. In most cases, the CIP identifies projects for a limited number of yea rs and may not include all improvements needed to serve future development covered by the impact fee study.We recommend that the City Council cite this development impact fee study as the public document identifying the use of the fees. Indexing of In-Lieu/Impact Fees. Where impact fees calculated in this report are based on current costs, those costs should, if possible,be adjusted periodically to account for changes in the cost of facilities or other capital assets that will be funded by the impact fees.That 305 City of La Quinta Page 10-7 Development Impact Fee Study August 8,2019 adjustment is intended to account for escalation in costs for land, construction, vehicles and other relevant capital assets. We recommend the Engineering News Record Building Cost Index as the primary basis for indexing construction costs .Where land costs are covered by an impact fee or in-lieu fee, land costs should be adjusted based on changes in local land prices. Training and Public Information Effective administration of an impact fee program requires considerable preparation and training. It is important that those responsible for collecting the fees, and for explaining them to the public, understand both the details of t he fee program and its supporting rationale. Before fees are imposed, a staff training workshop is highly desirab le if more than a handful of employees will be involved in collecting or accounting for fees. It is also useful to pay close attention to ha ndouts that provide information to the public regarding impact fees. Impact fees should be clearly distinguished from other fees, such as user fees for application processing, and the purpose and use of particular impact fees should be made clear. Finally, anyone responsible for accounting, capital budgeting, or project management for projects involving impact fees m ust be fully aware of the restrictions placed on the expenditure of impact fee revenues.Some fees recommended in this report are tied to spe cific improvements and cost estimates. Fees must be expended accordingly and the City must be able to show that funds have been properly expended. Recovery of Study Costs and Administrative Costs To recover the cost of periodic impact fee update studies a nd ongoing staff costs for managing those updates and preparing annual reports and five-year updates required by the Mitigation Fee Act, an administrati ve charge may be added to the impact fees calculated in this report. The administrative charges are included in the calculation of impact fees in this report. 306 Development Impact Fee Study Update Overview The following is a brief overview of the changes presented within the 2019 DIF Update: Chapter 2 - Development Data: Land Use, Demographics and Development Potential have been updated to reflect the City’s current socio-economic data (SED) used to tabulate existing, future, and ultimate build out development. Information on land use and demographics for this study was prepared by the La Quinta Planning Division. Sources of data include the 2035 La Quinta General Plan Update, the 2010 U.S. Census, and the California Department of Finance population estimates. Data on existing land use, and demographics and development used in this report have been updated through June 2019. The updated SED presented within this section forms the basis of fee calculation for all DIF fees collected. Chapter 3 – Parks and Recreation Impact Fees: This year’s DIF update includes calculations for both the Quimby Act Fees, and the Park and Recreation Impact Fees. Quimby Act In-Lieu Fees – The Quimby Act (Government code 66477) authorizes the city to require residential subdivisions dedicate land for parks or pay fees in lieu of dedication. Chapter 3 calculates the in-lieu fees, which apply only to residential projects that involve a subdivision. Park and Recreation Impact Fees – Impact fees for parkland acquisition that apply to residential projects not involving a subdivision, and impact fees for construction of park improvements that apply to all residential development projects. Chapter 4 – Community and Cultural Centers This chapter calculates impact fees for community and cultural centers needed to serve future development in La Quinta. This fee was formerly known as the Community Centers impact fee. The scope of the fee has been broadened in this study update to include cultural facilities such as the La Quinta Museum. Previously, only portions of the museum and Boys and Girls Club used as meeting rooms were covered. The impact fees calculated in this Chapter are based on the City’s existing investment per capita in community and cultural center facilities and will be used to provide additional facilities to maintain the current level of service as the City continues to grow. ATTACHMENT 2 307 Chapter 5 – Library Facilities and Materials This chapter calculates impact fees for the La Quinta Library, which is owned by the City of La Quinta and operated by the Riverside County Library System. The existing Library was designed to serve the projected population within the corporate boundaries of the City. Chapter 6 – Civic Center Facilities This chapter calculates impact fees for the La Quinta Civic Center. When the most recent Civic Center expansion was constructed, the City expected that the expanded facility would have adequate capacity to serve all planned development within the corporate boundaries of the City. This expectation has changed as the City began to bring in-house more services that were formerly contracted out. Space within the Civic Center is now at a premium and additional space will be required as the City continues to grow. Chapter 7 – Maintenance Facilities and Equipment This chapter calculates impact fees for the corporate yard maintenance facilities needed to serve future development in La Quinta. Chapter 8 – Fire Protection Facilities This chapter calculates impact fees for La Quinta’s Fire protection facilities. The City contracts with the Riverside County Fire Department for fire protection services. The City builds and owns the fire stations in La Quinta. There are three existing fire stations in the City and a fourth new station is planned in or near the southeastern quadrant of the City. This study assumes that the cost of the fourth fire station will be shared equally between La Quinta and Riverside County. Chapter 9 – Transportation Facilities This chapter calculates the impact fees for improvements to La Quinta’s transportation system, including arterial streets, medians, roundabouts, traffic signals, bridges, bike lanes and sidewalks. This study assigns shares of the cost of each improvement to impact fees and to various other funding sources. In the past, the City Council discounted transportation impact fees by 22%. The Fees presented within the September 2019 update do not automatically include this discount. The following table presents the proposed fee and compares it the adjusted fee (discounted fee) and the existing fee. 308 DEVELOPMENT TYPE PROPOSED 22% DISCOUNT ADJUSTED FEE EXISTING FEE DIFFERENCE PERCENT Residential - Single Family Detached 4,009.00$ 881.98$ 3,127.02$ 2,842.00$ 285.02$ 9.11% Residential - Single Family Attached 3,076.00$ 676.72$ 2,399.28$ 2,842.00$ (442.72)$ -18.45% Residential - Multi-Family/Other 2,281.00$ 501.82$ 1,779.18$ 1,745.00$ 34.18$ 1.92% Office/Medical 6,542.00$ 1,439.24$ 5,102.76$ 4,645.00$ 457.76$ 8.97% General Commercial 8,057.00$ 1,772.54$ 6,284.46$ 5,769.00$ 515.46$ 8.20% Tourist Commercial 1,859.00$ 408.98$ 1,450.02$ 1,590.00$ (139.98)$ -9.65% Golf Course 930.00$ 204.60$ 725.40$ 669.00$ 56.40$ 7.78% 309 310 City of La Quinta FINANCIAL ADVISORY COMMISSION MEETING: October 9, 2019 STAFF REPORT AGENDA TITLE: REVIEW AND DISCUSS PRELIMINARY 10-YEAR FINANCIAL PROJECTIONS FOR THE GENERAL FUND RECOMMENDATION Review and discuss preliminary 10-year financial projection for the General Fund. EXECUTIVE SUMMARY • The Financial Advisory Commission (FAC) requested the preliminary review of updated 10-year financial projections. • Two scenarios are presented for discussion – stable and minor recession. • Subsequent to the issuance of audit financial statements for 2018/19, financial projections will be updated. FISCAL IMPACT – None. BACKGROUND/ANALYSIS Annually, financial projections are provided to the public at a January community workshop. In advance of that, the FAC asked to review and discuss updated 10-year financial projections. The General Fund (Fund) is the least restrictive fund of the City and provides the greatest resources to support citywide operations, therefore, 10-year projections are presented for this Fund. The Fund accounts for revenues from major taxes, services provided by the City, license and permits, franchise fees, and negotiated intergovernmental revenues. These revenues provide resources for public safety (police and fire), daily operations, community events, and contract services, as well as support for capital improvements. The annual community workshop event marks the official start of the new budget preparation cycle. The attached projections are a preview to this annual update and do not include actuals for fiscal year (FY) ending 2018/19, since that year has not been fully audited and year-end accounting entries are currently being finalized. STUDY SESSION ITEM NO. 1 The attached projections use the current 2019/20 budget and apply a growth factor for the 10-year model. Two scenarios are presented for discussion. • A stable economic outlook (Attachment 1) • A minor recession starting in FY 2020/21 (Attachment 2) These projections will be updated in December 2019, after audited financial statements are issued, and will include actuals for FY 2018/19. ALTERNATIVES: The purpose of this item is to present preliminary projections and get input from the Commission. Prepared by: Karla Romero, Finance Director Attachment: 1. General Fund Financial Projections, Stable 2. General Fund Financial Projections, Minor Recession City of La Quinta As of October 1, 2019 Growth Adopted Budget 2020/21 to 2029/30 Projections 2019/20 *2020/21 2021/22 2022/23 2023/24 2024/25 2025/26 2026/27 2027/28 2028/29 2029/30 TOTAL 1. Cash Receipts Sales Tax - Measure G ᵃ 10,246,500$ 10,594,385$ 10,700,329$ 10,807,332$ 10,915,405$ 11,024,559$ 11,134,805$ 11,246,153$ 11,358,615$ 11,472,201$ 11,586,923$ 110,840,707$ Sales Tax - Bradley Burns 1% 9,535,900 9,631,259 9,727,572 9,824,847 9,923,096 10,022,327 10,122,550 10,223,776 10,326,013 10,429,273 10,533,566 100,764,279 Transient Occupancy Tax 2% 9,860,000 10,057,200 10,258,344 10,463,511 10,672,781 10,886,237 11,103,961 11,326,041 11,552,561 11,783,613 12,019,285 110,123,534 Property Tax 2% 9,344,200 9,531,084 9,721,706 9,916,140 10,114,463 10,316,752 10,523,087 10,733,549 10,948,220 11,167,184 11,390,528 104,362,711 Fire Service Property Tax 2% 7,127,700 7,270,254 7,415,659 7,563,972 7,715,252 7,869,557 8,026,948 8,187,487 8,351,237 8,518,261 8,688,627 79,607,253 Fire Property Tax Reserves ᵇ 975,900 344,766 580,112 831,587 1,100,086 1,386,548 1,691,962 2,017,368 936,511 - - 8,888,940 Motor Vehicle In-Lieu 2% 4,165,000 4,248,300 4,333,266 4,419,931 4,508,330 4,598,497 4,690,466 4,784,276 4,879,961 4,977,561 5,077,112 46,517,700 Other Revenue/Intergovernmental 1% 1,600,300 1,616,303 1,632,466 1,648,791 1,665,279 1,681,931 1,698,751 1,715,738 1,732,896 1,750,225 1,767,727 16,910,106 Franchise Fees 1% 1,804,000 1,822,040 1,840,260 1,858,663 1,877,250 1,896,022 1,914,982 1,934,132 1,953,473 1,973,008 1,992,738 19,062,570 Charges for Services 1% 1,024,800 1,035,048 1,045,398 1,055,852 1,066,411 1,077,075 1,087,846 1,098,724 1,109,712 1,120,809 1,132,017 10,828,892 Development Related Permits 1%834,200 842,542 850,967 859,477 868,072 876,753 885,520 894,375 903,319 912,352 921,476 8,814,853 Document Transfer Tax 1%575,000 580,750 586,558 592,423 598,347 604,331 610,374 616,478 622,643 628,869 635,158 6,075,930 Business Licenses/Permits 1%477,200 481,972 486,792 491,660 496,576 501,542 506,557 511,623 516,739 521,907 527,126 5,042,494 Fines and Assessments 1%276,500 279,265 282,058 284,878 287,727 290,604 293,510 296,445 299,410 302,404 305,428 2,921,730 SilverRock Resort Net Revenue ᶜ 531,400 1,260,000 2,500,000 2,960,000 2,842,000 3,222,000 3,540,000 3,575,400 3,611,100 24,041,900 2. Total Revenue $57,847,200 $58,335,168 $59,992,886 $61,879,065 $64,309,074 $65,992,734 $67,133,320 $68,808,165 $69,031,309 $69,133,066 $70,188,809 $654,803,596 3. Cash Paid Out Police Services Contract ᵈ 7% 16,866,100 18,046,727 19,309,998 20,661,698 22,108,017 23,655,578 25,311,468 27,083,271 28,979,100 31,007,637 33,178,172 249,341,664 Fire Service Contract ᵈ 5% 7,252,400 7,615,020 7,995,771 8,395,560 8,815,338 9,256,104 9,718,910 10,204,855 10,715,098 11,250,853 11,813,395 95,780,903 Salaries (Full-Time Employees)3% 6,403,300 6,595,399 6,793,261 6,997,059 7,206,971 7,423,180 7,645,875 7,875,251 8,111,509 8,354,854 8,605,500 75,608,858 Maintenance & Operations ᵉ 2% 6,317,200 6,443,544 6,572,415 6,703,863 6,837,940 6,974,699 7,114,193 7,256,477 7,401,607 7,549,639 7,700,632 70,555,009 Capital Expenses ᶠ 3,451,000 2,052,000 2,052,000 2,052,000 2,052,000 2,052,000 2,052,000 2,052,000 2,052,000 2,052,000 2,052,000 20,520,000 Capital Expenses from Measure G 5,580,100 5,881,246 5,000,000 5,000,000 5,000,000 5,000,000 5,000,000 5,000,000 5,000,000 5,000,000 5,000,000 50,881,246 Other Contract Services 2% 3,251,900 3,316,938 3,383,277 3,450,942 3,519,961 3,590,360 3,662,168 3,735,411 3,810,119 3,886,322 3,964,048 36,319,546 Transfers Out ᶢ 1% 1,832,500 1,850,825 1,869,333 1,888,027 1,906,907 1,925,976 1,945,236 1,964,688 1,984,335 2,004,178 2,024,220 19,363,725 Employee Medical Insurance Costs 3% 1,749,300 1,801,779 1,855,832 1,911,507 1,968,853 2,027,918 2,088,756 2,151,418 2,215,961 2,282,440 2,350,913 20,655,377 Other Personnel Costs 2% 1,159,900 1,183,098 1,206,760 1,230,895 1,255,513 1,280,623 1,306,236 1,332,361 1,359,008 1,386,188 1,413,912 12,954,593 PERS Unfunded Pension Liability ͪ860,000 859,277 964,300 1,091,700 1,197,200 1,259,600 1,306,000 1,332,120 1,358,762 1,385,938 1,413,656 12,168,553 PERS Normal Payroll Costs 2%574,200 585,684 597,397.68 609,346 621,533 633,963 646,642 659,575 672,767 686,222 699,947 6,413,076 Salaries (Part-Time/Temporary)2%340,600 347,412 354,360 361,447 368,676 376,050 383,571 391,242 399,067 407,049 415,189 3,804,064 Measure G Reserves 1,916,400 1,500,000 1,500,000 1,500,000 1,400,000 500,000 - - - - - 4. Total Operational Expenses $57,554,900 $58,078,949 $59,454,705 $61,854,044 $64,258,908 $65,956,052 $68,181,054 $71,038,670 $74,059,332 $77,253,318 $80,631,583 $674,366,615 5. Yearly Operating Cash Position (2 minus 4) 292,300 256,219 538,181 25,021 50,166 36,682 (1,047,734) (2,230,505) (5,028,023) (8,120,252) (10,442,774) (25,963,019) 6. RDA Loan Repayment - General Fund Repayment based on Last & Final ROPS 2,540,262 2,591,066 2,642,888 2,695,746 2,749,661 2,804,654 2,860,747 2,917,962 2,976,321 3,035,847 2,748,258 28,023,150 7. Cash Position After RDA Repayment (6 plus 7)2,832,562$ 2,847,285$ 3,181,069$ 2,720,767$ 2,799,827$ 2,841,336$ 1,813,013$ 687,457$ (2,051,702)$ (5,084,405)$ (7,694,516)$ 2,060,131$ OPERATING BUDGET NOTES: a - Measure G sales tax effective April 1, 2017 is projected to be 110% of Bradley Burns sales tax collected. b - Fire Property Tax Reserve account balance as of June 30, 2019 is $9,864,840. These funds are held in trust by the County of Riverside and restricted for fire services. c - SilverRock Resort Net Revenue includes revenue derived from sales tax, property tax, and transient occupancy taxes. d - Police and Fire services are provided by the County of Riverside and subject to the County's annual budget and contractual obligations. e - Maintenance and operations includes utilities and internal services charges. f - Ongoing capital expense projections include minimum capital funding required for street and sidewalk improvements to secure Measure A and Gas Tax funding (both restricted for road improvements). g - Transfers Out support the Gas Tax Fund for street improvements, the Landscape and Lighting District, Art in Public Places, and SilverRock golf course. h - PERS unfunded pension liability projections are based on CalPERS actuarial valuations as of June 30, 2018 issued in August 2019. * Adopted 2019/20 budget does NOT include capital or operational carryovers from 2018/19 which will be provided after audit, any previously approved adjustments during the first quarter for 2019/20, nor First Quarter Budget Report adjustments. RDA loan repayments end in 2029/30 and are allocated 80% to the General Fund and 20% to the Housing Authority Fund. GENERAL FUND FINANCIAL PROJECTIONS - Stable Outlook OPERATING BUDGETThe Adopted Budget for 2019/20 EXCLUDES carryovers from 2018/19, approved adjustments or first quarter updates. Revenue projections are based on current economic conditions and historical trends. All assumptions include stable growth with no economic downturns. Current Fire Service Reserve balance as of June 30, 2019 is $9,864,840. Reserves will be fully utilized by 2028/29. Expenditure projections are based on current operations and regulatory requirements. RDA LOANATTACHMENT 1 ATTACHMENT 1 City of La Quinta As of October 1, 2019 Growth Adopted Budget 2020/21 to 2029/30 Projections 2019/20 *2020/21 2021/22 2022/23 2023/24 2024/25 2025/26 2026/27 2027/28 2028/29 2029/30 TOTAL 1. Cash Receipts 10% Decrease 8% Decrease Sales Tax - Measure G ᵃ 10,246,500$ 9,221,850$ 9,534,946$ 9,630,296$ 9,726,599$ 9,823,865$ 9,922,103$ 10,021,325$ 10,121,538$ 10,222,753$ 10,324,981$ 98,550,255$ Sales Tax - Bradley Burns 1% 9,535,900 8,582,310 8,668,133 8,754,814 8,842,363 8,930,786 9,020,094 9,110,295 9,201,398 9,293,412 9,386,346 89,789,951 Transient Occupancy Tax 2% 9,860,000 8,874,000 9,051,480 9,232,510 9,417,160 9,605,503 9,797,613 9,993,565 10,193,437 10,397,305 10,605,251 97,167,824 Property Tax 2% 9,344,200 9,531,084 8,768,597 8,943,969 9,122,849 9,305,306 9,491,412 9,681,240 9,874,865 10,072,362 10,273,809 95,065,492 Fire Service Property Tax 2% 7,127,700 7,270,254 6,688,634 6,822,406 6,958,854 7,098,032 7,239,992 7,384,792 7,532,488 7,683,138 7,836,800 72,515,390 Fire Property Tax Reserves ᵇ 975,900 344,766 1,307,137 1,573,153 1,856,483 2,158,073 1,649,328 - - - - 8,888,940 Motor Vehicle In-Lieu 2% 4,165,000 4,248,300 3,908,436 3,986,605 4,066,337 4,147,664 4,230,617 4,315,229 4,401,534 4,489,564 4,579,356 42,373,641 Other Revenue/Intergovernmental 1% 1,600,300 1,616,303 1,632,466 1,648,791 1,665,279 1,681,931 1,698,751 1,715,738 1,732,896 1,750,225 1,767,727 16,910,106 Franchise Fees 1% 1,804,000 1,822,040 1,840,260 1,858,663 1,877,250 1,896,022 1,914,982 1,934,132 1,953,473 1,973,008 1,992,738 19,062,570 Charges for Services 1% 1,024,800 1,035,048 1,045,398 1,055,852 1,066,411 1,077,075 1,087,846 1,098,724 1,109,712 1,120,809 1,132,017 10,828,892 Development Related Permits 1%834,200 750,780 758,288 765,871 773,529 781,265 789,077 796,968 804,938 812,987 821,117 7,854,820 Document Transfer Tax 1%575,000 580,750 586,558 592,423 598,347 604,331 610,374 616,478 622,643 628,869 635,158 6,075,930 Business Licenses/Permits 1%477,200 481,972 486,792 491,660 496,576 501,542 506,557 511,623 516,739 521,907 527,126 5,042,494 Fines and Assessments 1%276,500 279,265 282,058 284,878 287,727 290,604 293,510 296,445 299,410 302,404 305,428 2,921,730 SilverRock Resort Net Revenue ᶜ 531,400 1,260,000 2,500,000 2,960,000 2,842,000 3,222,000 3,540,000 3,575,400 3,611,100 24,041,900 2. Total Revenue $57,847,200 $54,638,722 $55,090,583 $56,901,891 $59,255,763 $60,861,998 $61,094,257 $60,698,555 $61,905,069 $62,844,143 $63,798,954 $597,089,935 3. Cash Paid Out Police Services Contract ᵈ 7% 16,866,100 18,046,727 19,309,998 20,661,698 22,108,017 23,655,578 25,311,468 27,083,271 28,979,100 31,007,637 33,178,172 249,341,664 Fire Service Contract ᵈ 5% 7,252,400 7,615,020 7,995,771 8,395,560 8,815,338 9,256,104 9,718,910 10,204,855 10,715,098 11,250,853 11,813,395 95,780,903 Salaries (Full-Time Employees)3% 6,403,300 6,595,399 6,793,261 6,997,059 7,206,971 7,423,180 7,645,875 7,875,251 8,111,509 8,354,854 8,605,500 75,608,858 Maintenance & Operations ᵉ 2% 6,317,200 6,443,544 6,572,415 6,703,863 6,837,940 6,974,699 7,114,193 7,256,477 7,401,607 7,549,639 7,700,632 70,555,009 Capital Expenses ᶠ 3,451,000 2,052,000 2,052,000 2,052,000 2,052,000 2,052,000 2,052,000 2,052,000 2,052,000 2,052,000 2,052,000 20,520,000 Capital Expenses from Measure G 5,580,100 5,881,246 5,000,000 5,000,000 5,000,000 5,000,000 5,000,000 5,000,000 5,000,000 5,000,000 5,000,000 50,881,246 Other Contract Services 2% 3,251,900 3,316,938 3,383,277 3,450,942 3,519,961 3,590,360 3,662,168 3,735,411 3,810,119 3,886,322 3,964,048 36,319,546 Transfers Out ᶢ 1% 1,832,500 1,850,825 1,869,333 1,888,027 1,906,907 1,925,976 1,945,236 1,964,688 1,984,335 2,004,178 2,024,220 19,363,725 Employee Medical Insurance Costs 3% 1,749,300 1,801,779 1,855,832 1,911,507 1,968,853 2,027,918 2,088,756 2,151,418 2,215,961 2,282,440 2,350,913 20,655,377 Other Personnel Costs 2% 1,159,900 1,183,098 1,206,760 1,230,895 1,255,513 1,280,623 1,306,236 1,332,361 1,359,008 1,386,188 1,413,912 12,954,593 PERS Unfunded Pension Liability ͪ860,000 859,277 964,300 1,091,700 1,197,200 1,259,600 1,306,000 1,332,120 1,358,762 1,385,938 1,413,656 12,168,553 PERS Normal Payroll Costs 2%574,200 585,684 597,397.68 609,346 621,533 633,963 646,642 659,575 672,767 686,222 699,947 6,413,076 Salaries (Part-Time/Temporary)2%340,600 347,412 354,360 361,447 368,676 376,050 383,571 391,242 399,067 407,049 415,189 3,804,064 Measure G Reserves 1,916,400 - - - - - - - - - - 4. Total Operational Expenses $57,554,900 $56,578,949 $57,954,705 $60,354,044 $62,858,908 $65,456,052 $68,181,054 $71,038,670 $74,059,332 $77,253,318 $80,631,583 $674,366,615 5. Yearly Operating Cash Position (2 minus 4) 292,300 (1,940,227) (2,864,122) (3,452,153) (3,603,144) (4,594,054) (7,086,797) (10,340,115) (12,154,264) (14,409,176) (16,832,629) (77,276,680) 6. RDA Loan Repayment - General Fund Repayment based on Last & Final ROPS 2,540,262 2,591,066 2,642,888 2,695,746 2,749,661 2,804,654 2,860,747 2,917,962 2,976,321 3,035,847 2,748,258 28,023,150 7. Cash Position After RDA Repayment (6 plus 7)2,832,562$ 650,839$ (221,234)$ (756,407)$ (853,483)$ (1,789,400)$ (4,226,050)$ (7,422,153)$ (9,177,943)$ (11,373,329)$ (14,084,371)$ (49,253,530)$ OPERATING BUDGET NOTES: a - Measure G sales tax effective April 1, 2017 is projected to be 110% of Bradley Burns sales tax collected. b - Fire Property Tax Reserve account balance as of June 30, 2019 is $9,864,840. These funds are held in trust by the County of Riverside and restricted for fire services. c - SilverRock Resort Net Revenue includes revenue derived from sales tax, property tax, and transient occupancy taxes. d - Police and Fire services are provided by the County of Riverside and subject to the County's annual budget and contractual obligations. e - Maintenance and operations includes utilities and internal services charges. f - Ongoing capital expense projections include minimum capital funding required for street and sidewalk improvements to secure Measure A and Gas Tax funding (both restricted for road improvements). g - Transfers Out support the Gas Tax Fund for street improvements, the Landscape and Lighting District, Art in Public Places, and SilverRock golf course. h - PERS unfunded pension liability projections are based on CalPERS actuarial valuations as of June 30, 2018 issued in August 2019. * Adopted 2019/20 budget does NOT include capital or operational carryovers from 2018/19 which will be provided after audit, any previously approved adjustments during the first quarter for 2019/20, nor First Quarter Budget Report adjustments. GENERAL FUND FINANCIAL PROJECTIONS - Minor Recession OPERATING BUDGETThe Adopted Budget for 2019/20 EXCLUDES carryovers from 2018/19, approved adjustments or first quarter updates. Revenue projections are based on current economic conditions and historical trends. All assumptions include stable growth with no economic downturns. Current Fire Service Reserve balance as of June 30, 2019 is $9,864,840. Reserves will be fully utilized by 2028/29. Expenditure projections are based on current operations and regulatory requirements. RDA loan repayments end in 2029/30 and are allocated 80% to the General Fund and 20% to the Housing Authority Fund. RDA LOANATTACHMENT 2 ATTACHMENT 2 City of La Quinta FINANCIAL ADVISORY COMMISSION MEETING: October 9, 2019 STAFF REPORT AGENDA TITLE: DISCUSS PENSION TRUST AND UNFUNDED LIABILTIY RECOMMENDATION Discuss pension trust and unfunded liability. EXECUTIVE SUMMARY • In fiscal year 2018/19 the City established a Pension Trust with a lump sum contribution of $6.5 million. • A Financial Advisory Commission sub-committee concluded its review and recommended a moderate investment strategy. FISCAL IMPACT – None, this is a discussion item only. BACKGROUND/ANALYSIS Annually in August, CalPERS issues an actuarial report for each pension tier. These reports update participating agencies on their unfunded pension liability, projected future contributions towards the unfunded liability and ongoing payroll contributions (employer and employee rates). The reports issued in August 2019 have a measurement date of June 30, 2018. The unfunded liability is a moving target and can change from year to year based on the following factors: • Payroll growth rates (salary adjustments, currently at 2.75%) • Inflation rate (currently at 2.5%) • Anticipated investment returns from PERS (discount rate, currently at 7%) • Policy’s set by CalPERS Board of Administration • Amortization period of unfunded liabilities (from 30 to 20 years) and 15 years for inactive employees • Life expectancy of plan members STUDY SESSION ITEM NO. 2 Classic Tier Tier 2 PEPRA Tier TOTAL $ Change % Change Base Amount Paid 2016-17 471,501$ -$ 20$ 471,521$ Base Amount Paid 2017-18 564,145$ 201$ 150$ 564,496$ 92,975$ 19.72% Base Amount Paid 2018-19 698,026$ 5,197$ 8,591$ 711,814$ 147,318$ 26.10% Base Amount Paid 2019-20 842,401$ 4,955$ 11,921$ 859,277$ 147,463$ 20.72% For Upcoming Budget 2020-21 952,096$ 5,590$ 19,433$ 977,119$ 117,842$ 13.71% Projected with 7% return 2021-22 1,084,000$ 5,700$ 20,000$ 1,109,700$ 132,581$ 13.57% Projected with 7% return 2022-23 1,195,000$ 5,900$ 21,000$ 1,221,900$ 112,200$ 10.11% Projected with 7% return 2023-24 1,261,000$ 6,100$ 21,000$ 1,288,100$ 66,200$ 5.42% Projected with 7% return 2024-25 1,333,000$ 6,200$ 22,000$ 1,361,200$ 73,100$ 5.68% Projected with 7% return 2025-26 1,369,000$ -$ -$ 1,369,000$ 7,800$ 0.57% Classic Tier Tier 2 PEPRA Tier TOTAL $ Change % Change 2015 9,260,786$ 1,640$ 4,627$ 9,267,053$ 2016 12,049,299$ 15,563$ 22,338$ 12,087,200$ 2,820,147$ 30.43% 2017 12,011,222$ 15,353$ 22,060$ 12,048,635$ (38,565)$ -0.32% Reporting on CAFR 2018 13,795,874$ 32,542$ 68,989$ 13,897,405$ 1,848,770$ 15.34% Projected as of 6/30/18 2019 14,089,055$ 22,773$ 75,183$ 14,187,011$ 289,606$ 2.08% Projected as of 6/30/18 2020 14,227,184$ 24,959$ 86,762$ 14,338,905$ 151,894$ 1.07% Annual Contribution for Unfunded Liability Unfunded Pension Liability, Years Ending June 30th Each year the City pays an amount towards the unfunded liability directly to PERS. This can be paid monthly or in July with a lump sum discounted contribution. The City has elected to pay the lump sum contribution and for the last two years has sent additional payments directly to PERS as follows: • FY 2018/19 $37,413 • FY 2019/20 $20,000 In addition, to retain local control of funds but earn a higher rate of return, the City established a Pension Trust with PARS (Public Agency Retirement Services). In 2018/19, the City contributed $6.5 million to the trust. A sub- committee of two Financial Advisory Commissioners (Twohey and Hunter) and finance staff (Director and Analyst) reviewed the long-term investment strategy for the trust and selected a moderate portfolio strategy. The City does not anticipate using trust funds to pay for its annual unfunded liability contribution nor sending these funds directly to PERS. Based on the investment strategy selected the 10-year return as of Quarter 2, 2019 was 8.09% and the portfolio is comprised of 50% equity, 45% fixed income, and 5% cash. As of August 2019, pension trust activity will be reported on treasurer reports. Below is a summary of the City’s annual pension contribution and its unfunded pension liability for each pension tier. ALTERNATIVES This item is for discussion, no alternatives are recommended. Prepared by: Karla Romero, Finance Director City of La Quinta FINANCIAL ADVISORY COMMISSION MEETING DEPARTMENT REPORT TO: Financial Advisory Commissioners FROM: Rosemary Hallick, Financial Services Analyst DATE: October 9, 2019 SUBJECT: FIRST QUARTER 2019 (JANUARY – MARCH) SALES TAX UPDATE FOR THE CITY OF LA QUINTA The attached report was prepared by consultants HdL Companies as an update of sales tax receipts for first quarter sales from January to March 2019. Sales Tax Update •The City’s sales-per-capita was higher than both the county and state averages, as is typically the case for all quarters except the third. •General consumer goods (such as department stores) and restaurants/hotels made up 61% of sales tax revenue during this quarter, based on the unadjusted numbers. •La Quinta’s overall adjusted sales tax receipts for major industry groups increased 0.7%, which compares to Riverside County at 1.4% and Southern California at 0.9%. •Sales tax revenues are outpacing estimates and the City will exceed the current adjusted budget of 9,300,000. Measure G Update •As with Sales Tax, Measure G transaction taxes continue to come in above estimates and will exceed the current adjusted budget of $10,145,000 for the year. •General consumer goods (such as department stores) and restaurants/hotels made up 62% of transaction tax revenue during this quarter, a similar share to sales taxes. •The autos and transportation sector made up 12% of transaction tax revenue as opposed to 8% of sales tax revenue. •Our top 25 transactions tax producers predominately consisted of businesses located in La Quinta, however there were several businesses located outside of City limits that made the top 25. The City continuously monitors local development, economic conditions, impacts on travel and trade, and legislative and judicial news for any potential changes to sales tax collections. City staff will continue to monitor Measure G activity, as well as the projections provided by our consulting partners, to establish baselines for future budgeting purposes. Attachment 1: City of La Quinta Sales Tax Update DEPARTMENTAL REPORT ITEM NO. 1 ATTACHMENT 1 City of La Quinta FINANCIAL ADVISORY COMMISSION MEETING DEPARTMENT REPORT TO: Financial Advisory Commissioners FROM: Rosemary Hallick, Financial Services Analyst DATE: October 9, 2019 SUBJECT: INVESTMENT POLICY CERTIFICATION The City of La Quinta has been granted the California Municipal Treasurers Association (CMTA) Investment Policy Certification for the 2019/20 Investment Policy. The CMTA is an organization of treasury professionals focused on quality assurance programs, education, professional standards, and public accountability. With support from the California Debt and Investment Advisory Commission (CDIAC), the CMTA developed the Investment Policy Certification Program. The goal of the program is to provide professional guidance to develop and/or improve investment policies in California’s public sector agencies. Certification recognizes that the City’s policy adheres to the State of California Government Code and meets best practice guidelines in 18 different topic areas (Attachment 1). The benefits of certification include transparency to the public, confidence and verification that the policy has been reviewed by a certified professional organization, demonstration of due diligence, and audit compliance. Attachment: 1. CMTA Press Release and Certificate DEPARTMENTAL REPORT ITEM NO: 2 News Release FOR IMMEDIATE RELEASE Date: September 18, 2019 For more information contact: Shaun L. Farrell, Chairperson CMTA Investment Policy Certification Phone: 209-712-0428 Email: sfarrell@ci.galt.ca.us (Sacramento, California) – The California Municipal Treasurers Association (CMTA) Investment Policy Certification has been granted to the City of La Quinta. This Investment Policy Certification recognizes that CMTA has validated that the City of La Quinta’s Investment Policy adheres with the State of California Government Code and meets the program requirements within 18 different topics areas deemed to be best practices for investment policies. Those topics include: Scope, Prudence, Objective, Delegation of Authority, Ethics and Conflicts of Interest, Authorized Financial Dealers and Institutions, Authorized and Suitable Investments, Review of Investment Portfolio, Investment Pools/Mutual Funds, Collateralization, Safekeeping and Custody, Diversification, Maximum Maturities, Internal Controls, Performance Standards, Reporting, Investment Policy Adoption and Glossary. Once a policy is received by CMTA, it is independently evaluated using a scoring matrix by three separate CMTA professionals. When the agency receives a passing score, the Investment Policy earns the ‘Certified’ distinction. To enhance the municipal treasurer’s role, CMTA has developed a number of certification programs to reflect best practices and increase an individual’s knowledge of fixed income instruments. The Investment Policy Certification program began in 2012 with the support from the California Debt and Investment Advisory Commission. It is open to all government agencies within the State of California including special districts, cities and counties. CMTA was founded in 1958 by a handful of Municipal Treasurers from both Northern and Southern California whose primary interest was to improve their function in local Government. CMTA is a professional organization governed by active public officials who are representatives of their own local governmental units. ATTACHMENT 1 POWER POINTS FAC SPECIAL MEETING October 9,2019 10/09/2019 1 Financial Advisory Commission Special Meeting 10/9/2019 Announcements, Presentations, & Written Communications No. 1 PROCLAMATION – RECOGNITION OF SERVICE FOR OUTGOING COMMISSIONER TURBOW 10/09/2019 2 Announcements, Presentations, & Written Communications No. 2 2017/18 Comprehensive Annual Financial Report (CAFR) Award Announcements, Presentations, & Written Communications No. 3 City Boards and Commissions – Roles and Responsibilities of Appointed Members 10/09/2019 3 BOARDS & COMMISSIONS June 26, 2018 BALANCED DIVISION OF POWERS City Council - Policy Establish vision & direction for the community’s future Boards & Commissions – Advisory Advise Council on matters within their area of expertise; liaisons, & ambassadors City Clerk - Process Ensures the decision-making process is transparent to the public; it is properly recorded; & is in compliance City Manager & Staff - Product Deliver good & services that the taxpayers cannot provide for themselves 10/09/2019 4 CITY OF LA QUINTA City Council – 5 members (elected at-large) Council – Manager Planning Commission Community Services Commission Financial Advisory Commission Housing Commission Construction Board of Appeals La Quinta Municipal Code Title 2 ROLES & RESPONSIBILITIES Community Liaison and Ambassador Steward of public interest Understand the scope & authority of your Commission, & strive to work within that scope Members’ individual expertise Meeting preparation – be familiar with items under consideration Active participant Individual Members do not represent the entire Commission 10/09/2019 5 FINANCIAL ADVISORY COMMISSION (FAC) Established in 1993 as the Investment Advisory Board and changed in 2017 to the FAC Comprised of 7 members appointed by the City Council Meets – 2 nd Wednesday of February, May, August, & November at 4:00 p.m. Special Budget Meetings in April & June Advisory to the City Council Compensation - $75 per meeting FAC SCOPE OF PURVIEW Investment Policy – annually Treasury Reports – quarterly Audits (no. 4 from LQMC) Measure G Oversight Roles & Responsibilities – advisory to Council on Policy-related items (“what & why”) 10/09/2019 6 STATE LAWS GOVERNING COMMISSIONS Ralph M. Brown Act (GC § 54950 et seq.) Open and Public Meetings Decorum and Order Regular Meetings Serial Meetings Gatherings that are not “meetings” Ceremonial Events Conferences Publicized Community Meetings Brown Act (1953) California Government Code § 54950 et seq. Ralph M. Brown Open and Public Meetings “The people, in delegating authority, do not give their public servants the right to decide what is good for the people to know and what is not good for the people to know. The people insist on remaining informed so they may retain control over the governing instruments they have created.” 10/09/2019 7 TIME TO POST THE AGENDA? Regular Meetings 72 hours prior to the meeting Special Meetings 24 Hours Prior to Meeting Agenda Packet = Agenda & Staff Reports Before every meeting, staff shall prepare and publish an agenda containing a brief description of all items to be acted upon; these items are further elaborated on in a staff report which provides recommended action(s) as well as background on the necessity and implications of the action to be taken. The Agenda Packet shall be made available to the public at the same time it is delivered to the City Council. SERIAL MEETINGS Send information to staff to distribute Do NOT “Reply All” to emails F A E B D C A or 3rd party 10/09/2019 8 STATE LAWS GOVERNING COMMISSIONS Avoiding Conflict of Interest Political Reform Act Fair Political Practices Commission Form 700 – Statement of Economic Interest GC Section 1090 – Relations to Contracts Avoidance of Bias & Procedural Due Process Ethics Training Harassment Prevention Education Public Records Act POLITICAL REFORM ACT California Government Code § 81000 et seq. Access to Information Law –regarding financial interests of officials (a)State and local government should serve the needs and respond to the wishes of all citizens equally, without regard to their wealth; (b)Public officials, whether elected or appointed, should perform their duties in an impartial manner, free from bias caused by their own financial interests or the financial interests of persons who have supported them” (c)Requires the annual filing of an FPPC Form 700 containing officials’ financial holdings. It is a public document. 10/09/2019 9 FORM 700 California Government Code § 8100 et seq. New Members Have 30 days to file Assuming Office Form 700 from the date of appointment Existing Members Must file Annual Form 700 by April 1st for the year before Example: Period covering Jan 1 – Dec 31, 2016 – must file by April 1, 2017 Leaving Members Have 30 days to file Leaving Office Form 700 from the date of separation CONFLICT OF INTEREST (COI) Re: Agreements & Purchase Orders California Government Code § 87100 – 87505 Safeguard Law – protects against personal financial gain for officials. “No public official at any level of state or local government shall make, participate in making or in any way attempt to use his official position to influence a governmental decision in which he knows or has reason to know he has a financial interest.” Cal. Government Code §1090 – applies to contracts (includes purchase orders) If an elected official has a conflict, the entire agency has a conflict 10/09/2019 10 CONFLICT OF INTEREST (COI) Re: Agenda Items California Government Code § 87100 – 87505 COI – publicly identify the interest and leave the room. This rule includes meetings outside of formal meetings. Publicly identify the financial interest in detail sufficient to be understood by the public; Business relationship; proximity to residence, proximity to real property, etc. Recuse him/herself from discussion & voting on the matter; Leave the dais until after the discussion, vote, & any other disposition of the matter is concluded; Exemption – if the matter is on the Consent Calendar CONFLICT OF INTEREST (COI) Re: Agenda Items California Government Code § 87100 – 87505 Member disqualified from voting due to COI: May speak on the issue from the public podium during the time that the general public speaks on the issue Will be marked ABSENT from the vote for the item on the minutes Exemption – if the matter is on the Consent Calendar, the member will be marked ABSTAINING 10/09/2019 11 Ethics Training (Government Code Section 53232 – 53232.4) Required every 2 years – 2 hours of online or in-class training, per Assembly Bill No. 1234. Harassment Prevention Education (Government Code Sections 53237 – 53237.5) Required every 2 years per Assembly Bill No. 1661. Compliance is monitored by the City’s Human Resources Division; and you will be scheduled to attend scheduled classes to ensure compliance. STATE LAWS GOVERNING COMMISSIONS CA PUBLIC RECORDS ACT California Government Code § 6250 et seq. Access to Information Law = the right to monitor government “Access to information concerning the conduct of the people’s business is a fundamental and necessary right of every person in this state.” “The public must have access to information that enables them to monitor the functioning of their government” Anyone can file a request for records (RR) Must respond within 10 days if the records exist Can requests a 14-day extension if necessary in accordance with the CPRA Requests for information by elected and/or appointed public officials should be treated as any other RR and channeled through the Clerk’s Office 10/09/2019 12 MUNICIPAL LAWS GOVERNING COMMISSIONS Rules of Procedure Council Resolution 2015-023 La Quinta Municipal Code Personnel Policy for Appointed Officials Council Resolution 2019-027 CONDUCT DURING MEETINGS Public Any member of the public may address the legislative body. He/she shall be called to the podium by the Presiding Officer. He/she shall state name, address, company he/she represents, if any. All remarks & questions shall be addressed to the Presiding Officer & not to any other individual Member, staff, or other person. All comments must be within the scope of the subject matter jurisdiction of the legislative body. Public Hearings – all remarks shall be limited to the subject matter under consideration. 10/09/2019 13 CONDUCT DURING MEETINGS Staff May assist the Presiding Officer in conducting the meeting in accordance with the Brown Act: Verbally announcing the motion and vote (if omitted by the Presiding Officer) Steering the discussion to the subject matter under consideration if it has gone “off-track” If division of opinion between the Members is apparent, staff shall provide alternative options (i.e. continuing the matter, revising the motion, adding conditions of approval to address concerns raised at the meeting, etc.) CONDUCT DURING MEETINGS Addressing the Members and Presiding Officer If asked to speak by the Presiding Officer, approach the podium, greet the entity, and introduce yourself: “Good afternoon Chair Smith & Commissioners / Members of the Board” Always address the Presiding Officer, even if questions are posed by the Members, throughout the entire meeting “Chair Smith, to answer Commissioner’s Jones question xxxxxxxx” 10/09/2019 14 PLACING ITEMS ON FUTURE AGENDAS Make a request during a meeting under “Commissioners’ Items” section, and obtain Commission consensus to direct staff to place the item on a future agenda Contact Department Liaison Commission Chair or Department Director VOTING Abstain from voting – only due to reasons of COI, and will be considered absent. Abstentions for reasons other than COI – shall be counted as present for purposes of a quorum and their vote is counted with the majority. 10/09/2019 15 ABSENCES Attending all regularly scheduled meetings is apriority 2 Consecutive regular meetings 3 Regular meeting within a fiscal year Requesting an Excused Absence FAC – LOOKING AHEAD PARS Trust Investment Strategy Evaluation Investment Broker Recommendation Cash Handling Policy (new) Review of Updated 10-Year Financial Projections Review of 2019 DIF Study Evaluation of 457 Retirement Account Annual Measure G Compliance Report Review of Annual Financial Statements 10/09/2019 16 QUESTIONS & DISCUSSION Financial Advisory Commission 10/09/2019 Business Session Item No. 1 Review and Approve Cash Management Policy 10/09/2019 17 Policy Summary •Requested by CJPIA and CalTrans •For all City Funds and monetary transactions •Outlines current processes •Includes section on Federal Funds •Reviewed internally & by City Attorney •After Commission reviews, City Council will adopt 10/09/2019 18 Financial Advisory Commission 10/09/2019 Business Session Item No. 2 Review Broker/Dealer Selection and Approve Edits to the Investment Policy Adding New Brokers to Approved Financial Institutions List Investment Broker Selection •RFI issued twice on 3/1/19 & 6/5/19 •14 responses received •4 selected for interviews in September •Recommending two for approval –Higgins Capital Management –Great Pacific Securities 10/09/2019 19 Policy Update is Required •Investment Policy lists approved brokers and financial institutions in Appendix D •No other changes are recommended •Review and Approval by FAC, then City Council 10/09/2019 20 Financial Advisory Commission 10/09/2019 Business Session Item No. 3 Appoint two Financial Advisory Commissioners to Formulate and Approve the Annual Measure G Sales Tax Oversight Compliance Report Third Annual Report Fiscal Year Commissioner Commissioner 2016/17 George Batavick Javier Lopez 2017/18 Steven Rosen Daniel Twohey 2018/19 •Report Summarizes •Revenues •Expenditures •Reserve Balance •Budget for 2019/20 10/09/2019 21 Financial Advisory Commission 10/09/2019 Study Session Item No. 1 Review and Discuss Preliminary 10-year Projection for the General Fund Summary of Projections •Two scenarios are provided for discussion –Stable growth –Minor recession •Update in December for January workshop –After audit for FY 18/19 is completed –After six months of current FY 19/20 10/09/2019 22 Revenue Estimates •Sales tax, TOT could be higher during expansions •Property tax, fire service, motor vehicle in‐lieu –Based on property valuations, max. 2% increase •Development Related Permits – slow down Revenue Estimates •SilverRock revenues – Sales, TOT, Property Taxes –TOT sharing agreement for 10 years – 95%, 11‐15 years – 75% –Stops with 11% return on investment for developer •RDA loan repayment ends in 29/30 –Not for operational expenses, going to reserves 10/09/2019 23 Expense Estimates •Police reduced from 8% to 7% •Fire increased from 4% to 5% •Capital expenses baseline maintenance – road repair funding •Capital expenses Measure G ‐ $5M average set aside •Unfunded pension liability based on CalPERS accrual reports •Measure G Reserves 10/09/2019 24 Financial Advisory Commission 10/09/2019 Study Session Item No. 2 Discuss Pension Trust and Unfunded Liability Pension Liability Summary Classic Tier Tier 2 PEPRA Tier TOTAL $ Change % Change 2015 9,260,786$ 1,640$ 4,627$ 9,267,053$ 2016 12,049,299$ 15,563$ 22,338$ 12,087,200$ 2,820,147$ 30.43% 2017 12,011,222$ 15,353$ 22,060$ 12,048,635$ (38,565)$ ‐0.32% Reporting on CAFR 2018 13,795,874$ 32,542$ 68,989$ 13,897,405$ 1,848,770$ 15.34% Projected as of 6/30/18 2019 14,089,055$ 22,773$ 75,183$ 14,187,011$ 289,606$ 2.08% Projected as of 6/30/18 2020 14,227,184$ 24,959$ 86,762$ 14,338,905$ 151,894$ 1.07% Unfunded Pension Liability, Years Ending June 30th Classic Tier Tier 2 PEPRA Tier TOTAL $ Change % Change Base Amount Paid 2016‐17 471,501$ ‐$ 20$ 471,521$ Base Amount Paid 2017‐18 564,145$ 201$ 150$ 564,496$ 92,975$ 19.72% Base Amount Paid 2018‐19 698,026$ 5,197$ 8,591$ 711,814$ 147,318$ 26.10% Base Amount Paid 2019‐20 842,401$ 4,955$ 11,921$ 859,277$ 147,463$ 20.72% For Upcoming Budget 2020‐21 952,096$ 5,590$ 19,433$ 977,119$ 117,842$ 13.71% Projected with 7% return 2021‐22 1,084,000$ 5,700$ 20,000$ 1,109,700$ 132,581$ 13.57% Projected with 7% return 2022‐23 1,195,000$ 5,900$ 21,000$ 1,221,900$ 112,200$ 10.11% Projected with 7% return 2023‐24 1,261,000$ 6,100$ 21,000$ 1,288,100$ 66,200$ 5.42% Projected with 7% return 2024‐25 1,333,000$ 6,200$ 22,000$ 1,361,200$ 73,100$ 5.68% Projected with 7% return 2025‐26 1,369,000$ ‐$ ‐$ 1,369,000$ 7,800$ 0.57% Annual Contribution for Unfunded Liability 10/09/2019 25 Fund Balance Summary Estimated as of 6/30/20 Target Deficit Emergency Reserves Natural Disaster 10,000,000$ 10,000,000 - Economic Disaster 11,000,000 11,000,000 - Cash Flow Reserve 5,000,000 5,000,000 - Capital Replacement Reserve 5,000,000 10,000,000 5,000,000 Unassigned Reserve 12,832,662 - Total Committed & Unassigned Funds 43,832,662 - - Sales Tax (Measure G) 8,825,257 - Public Safety Fire Service Trust 8,174,100 - Pension Trust Fund 6,740,000 10,000,000 3,260,000 Other Post Employment Benefit Trust 1,614,000 - Total Assigned Funds 25,353,357 - Overall Total 69,186,019$ 46,000,000 8,260,000 82% Funded Investment Strategy •Conservative •Moderately Conservative •Moderate •Balanced •Capital Appreciation 10/09/2019 26 QUESTIONS? Financial Advisory Commission 10/09/2019 Departmental Report Item No. 1 First Quarter 2019 (January-March) Sales Tax Update for the City of La Quinta 10/09/2019 27 Financial Advisory Commission 10/09/2019 Departmental Report Item No. 2 2019/20 Investment Policy Certification Financial Advisory Commission Next Regular Quarterly Meeting is on November 13, 2019 10/09/2019 28