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City of San Leandro <br />Meeting Date: March 4, 2013 <br />Staff Report <br />Agenda Section:File Number:13-090 CONSENT CALENDAR <br />Agenda Number:8.E. <br />TO:City Council <br />FROM:Chris Zapata <br />City Manager <br />BY:David Baum <br />Finance Director <br />FINANCE REVIEW:David Baum <br />Finance Director <br />TITLE:Staff Report for Acceptance of the City of San Leandro’s Investment Report <br />for the Quarter Ended December 31, 2012 <br />SUMMARY AND RECOMMENDATIONS <br />Staff recommends that the City Council review and accept the attached investment report for <br />the quarter ended December 31, 2012. <br />BACKGROUND <br />At December 31, 2012, the City’s investment portfolio had a market value of $74.5 million. Of <br />this total, $41.0 million was placed with the Local Agency Investment Fund (LAIF) and bank <br />accounts and $33.5 million was placed in the Chandler Asset Management portfolio . On <br />January 31, 2012 the Redevelopment Agency LAIF accounts were closed as a result of the <br />dissolution of the San Leandro Redevelopment Agency . These funds were transferred to the <br />City’s Economic Development Agency LAIF account in the amount of $9.3 million. <br />Subsequently, the Economic Development Agency LAIF account has been transferred to a <br />new Successor Agency LAIF account established during the quarter ended June 30, 2012. <br />The balance in this new account is $5.9 million and has decreased since January due to debt <br />repayments. <br />During September, 2012 staff transferred $4.9 million out of LAIF to be reinvested by <br />Chandler in securities with a greater yield. Eleven securities were purchased with half of <br />these operating a business in the City of San Leandro (Wells Fargo Bank, Coca-Cola, JP <br />Morgan Chase, John Deere, US Bancorp). The remaining six securities are with IBM, <br />Pepsico, HSBC USA, Ebay, General Electric and Microsoft. The average yield of this <br />reinvestment is 0.55% which exceeds the LAIF average book yield, and the average maturity <br />is less than two years. <br />The rate of return for LAIF for the quarter was 0.32%, while the average book yield for the <br />Chandler managed funds was 0.78%. The City’s investment policy establishes three bases <br />Page 1 City of San Leandro Printed on 2/26/2013