Fiscal Affairs Committee Meeting Agenda & Packet
Total Page:16
File Type:pdf, Size:1020Kb
CHUCK ENGELKEN, CHAIR THOMAS GARZA Councilmember, District 2 Councilmember, District 4 Alternate NANCY OJEDA Councilmember, District 6 JAY MARTIN Councilmember, District 5 CITY OF LA PORTE FISCAL AFFAIRS COMMITTEE MEETING AGENDA Notice is hereby given of a meeting of the City of La Porte Fiscal Affairs Committee to be held on March 9, 2020, in the City Hall Council Chambers, 604 West Fairmont Parkway, La Porte, Texas, beginning at 4:30 pm regarding the items of business according to the agenda listed below: 1. CALL TO ORDER 2. CITIZEN COMMENT (Generally limited to five minutes per person; in accordance with state law, the time may be reduced if there is a high number of speakers or other considerations.) 3. STATUTORY AGENDA (a) Presentation, discussion, and possible action to approve minutes of the meeting held on December 9, 2019. [Councilperson Engelken, Chairman] (b) Presentation, discussion, and possible action to receive and review the First Quarter (FY2020) Investment Report. [Shelley Wolny, Treasurer] (c) Presentation, discussion and possible action to receive and review purchasing card expenditures for September, October and November 2019. (Cherell Daeumer, Purchasing Manager) (d) Presentation, discussion, and possible action to accept the Fiscal Year Ending September 30, 2019 Comprehensive Annual Financial Report (CAFR). [Michael Dolby, Finance Director] (e) Presentation, discussion and possible action on RFP #20503 for Delinquent Ad Valorem Tax Collection Services. [Michael Dolby, Finance Director] (f) Presentation, discussion and possible action to approve Hilltop Securities as an approved broker for the City of La Porte. [Shelley Wolny, Treasurer] 4. SET NEXT MEETING 5. COMMITTEE COMMENTHear announcements concerning matters appearing on the agenda; items of community interest; and/or inquiries of staff regarding specific factual information or existing policy from the Committee members and City staff, for which no formal action will be discussed or taken. 6. ADJOURN Persons with disabilities who plan to attend this meeting and who may need auxiliary aids or services are requested to contact the City Secretary's office (281-470-5019), two working days prior to the meeting for appropriate arrangements. CERTIFICATE I, Lee Woodward, City Secretary, do hereby certify that a copy of the March 9, 2020, Fiscal Affairs Committee agenda was posted on the City Hall bulletin board, a place convenient and readily accessible to the general public at all times, and to the City's website, www.LaPorteTX.gov in compliance with Chapter 551, Texas Government Code. DATE OF POSTING TIME OF POSTING TAKEN DOWN Lee Woodward Lee Woodward, City Secretary CHUCK ENGELKEN, CHAIR THOMAS GARZA Councilmember District 2 Councilmember District 4 Alternate JAY MARTIN Councilmember, District 5 MINUTES OF MEETING OF FISCAL AFFAIRS COMMITTEE DECEMBER 9, 2019 The Fiscal Affairs Committee of the City of La Porte met on December 9, 2019, at the City Hall Council Chambers, 604 West Fairmont Parkway, La Porte, Texas, at 5:45 p.m., with the following in attendance: Committee members present: Chuck Engelken, Jay Martin, Thomas Garza Committee members absent: None Council-appointed officers present: Jason Weeks, Assistant City Manager; Lee Woodward, City Secretary CALL TO ORDER – Chairperson Engelken called the meeting to order at 5:45 p.m. 1. PUBLIC COMMENTS (Generally limited to five minutes per person; in accordance with state law, the time may be reduced if there is a high number of speakers or other considerations.) There were no public comments. 2. STATUTORY AGENDA (a) Presentation, discussion, and possible action to approve minutes of the meeting held on August 26, 2019. [Councilperson Engelken, Chairman] Committee member Martin moved to approve the minutes of the meeting held on August 26, 2019: the motion was adopted, 3-0. (b) Presentation, discussion, and possible action to receive and review purchasing card expenditures for June, July, and August 2019. [Michael Dolby, Finance Director] Presentation; no action required. (c) Presentation, discussion, and possible action to receive and review the Fourth Quarter (FY2019) Investment Report. [Shelley Wolny, Treasurer] Mrs. Wolny provided a report on the excellent condition of the City’s finances and the staff was lauded for their stewardship. 3. Set date for next meeting. [Michael Dolby, Finance Director] Committee members set March 9, 2020, as the next meeting date and presentation of the CAFR. 4. Administrative Reports. [Corby Alexander, City Manager] No reports. 5. COMMITTEE MEMBER COMMENTS Hear announcements concerning matters appearing on the agenda; items of community interest; and/or inquiries of staff regarding specific factual information or existing policy from the Committee members and City staff, for which no formal action will be discussed or taken. Committee member Garza asked the Committee to consider making him a member of the Committee rather than an alternate. Chair Engelken acknowledged it was an item for a future Council agenda. ADJOURNMENT - Without objection, Chair Engelken adjourned the meeting at 5:52 p.m. ________________________________ Lee Woodward, City Secretary CITY OF LA PORTE Interoffice Memorandum TO: Chuck Engelken, Councilmember Jay Martin, Councilmember Thomas Garza, Councilmember Corby Alexander, City Manager Jason Weeks, Assistant City Manager FROM: Michael Dolby, Director of Finance Shelley Wolny, Treasurer DATE: February 4, 2020 SUBJECT: Quarterly Investment Report For the first quarter of the 2020 fiscal year, the City’s investment portfolio yield averaged 1.87%, which is above the average yield of our benchmark at 1.61 % (see graph below). The average 26 basis points over the benchmark equates to $61,140 of additional earnings for the portfolio. The total interest earned through December 2020 for all funds is $591,863, which is 57% of the budget of $1,029,500. City vs. Benchmark 3.00% 2.50% 2.00% 1.50% 1.00% ` 0.50% 0.00% Portfolio Yield Benchmark At December 31st, the City’s portfolio totaled $96,216,600 and consisted of 31% in Texpool, 16% in Agency Notes, 13% in Texas Class and 40% in Logic. A larger than normal portion of the investment portfolio is currently invested in the pools. This is due to several maturities and calls over the last 6 months, as well as, the influx of cash from Industrial District payments and property tax collections. A share of these funds will be reinvested in agency notes as new issues become available. At the end of the first quarter, the City’s portfolio consisted of 83% of the portfolio maturing overnight, 11% maturing in 1 year and 6% maturing in 1-2 years. 1 By Investment Type By Investment Maturity 16% 31% 11% 6% 13% 83% 40% Texpool Logic Overnight 1-12 Months Texas CLASS Agency Notes 12-24 Months Currently, the 3-month T-Bill is at 1.57%; 2-year, at 1.61%; 5-year, at 1.68%; and, the 20-year is at 2.16. As you can see below, rates along the entire yield curve have dropped. Last year, the 3 month T-Bill was at 2.41%, the 2- year was at 2.68% and the 20-year was at 2.98%, which is a decline of 90 basis points on average across the curve. Yield Curve 4.00% 3.00% 2.00% 1.00% 0.00% Treasury Bills 1 year ago 3 months ago current The Fed cut the target rate by 25 basis points once again at the October Federal Open Market Committee meetings bringing the fed funds target rate to a range of 1.50% to 1.75%. The rate remained unchanged at the December and January meetings; however, the probability is favorable that another one or two rate cuts will occur in 2020 bringing the overnight rate down 50 basis points by year end. Staff continues to monitor rates and economic conditions, and the strategy for the portfolio will, as always, focus on laddering to pick up yield along the curve and maintaining a constant cash flow and liquid position. 2 Portfolio Composition and Value as of December 31, 2019 100.00% 80.00% Par Book Market Days to 60.00% Value Value Value Maturity Investment Pools 80,216,600 80,216,600 80,216,600 39 40.00% Agencies 16,000,000 16,000,000 16,011,849 328 Total 96,216,600 96,216,600 96,228,448 87 20.00% 0.00% Investment Pools Agencies Dec-19 Dec-18 Investment Maturity Schedule as of December 31, 2019 Overnight Book Value Percent Overnight 80,216,600 83.37% 1-12 months 10,000,000 10.39% 1-2 years 6,000,000 6.24% 1-12 months Total 96,216,600 100.00% 1-2 years Portfolio Performance for the month of December 31, 2019 Weighted 2.00% Portfolio Benchmark Average Yield Yield* Maturity 1.50% Pooled Funds 1.80% 1.58% 3.02 months Bond Funds 1.62% 1.55% 35 days 1.00% Total 1.71% 1.57% 2.96 months 0.50% 0.00% *The pooled funds benchmark is based on the average monthly yield of a 6-month Treasury. Pooled Funds Bond Funds Total The bond funds benchmark yield is based on the average monthly yield of a 1-month Treasury. The total is based on weighted average monthly benchmark yields. Portfolio Yield Benchmark Yield* Portfolio Earnings as of December 31, 2019 700,000 600,000 Budget Actual Percent General 650,000 260,280 40.04% 500,000 Enterprise 148,000 117,296 79.25% 400,000 Internal Service 73,000 43,982 60.25% 300,000 Other Funds 158,500 170,305 107.45% 200,000 Total 1,029,500 591,863 57.49% 100,000 - General Enterprise Internal Other Funds Service Budget Actual Yield Curve WAM - Pooled Funds 1.70% 4.00 1.65% 3.50 December % of funds invested in: 2019 2018 3.00 1.60% Securities & Pools 79.81% 83.74% 2.50 1.55% Bank Depository 20.19% 16.26% 2.00 Total % of funds invested 100.00% 100.00% 1.50% 1.50 1.45% 1.00 Operating Account Balance