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CITY OF SAN LEANDRO
<br />NOTES TO BASIC FINANCIAL STATEMENTS
<br />For The Year Ended June 30, 2016
<br />
<br />
<br />NOTE 2 - CASH AND INVESTMENTS (Continued)
<br />
<br />Fair Value Hierarchy
<br />
<br />The City categorizes its fair value measurements within the fair value hierarchy established by generally
<br />accepted accounting principles. The hierarchy is based on the valuation inputs used to measure fair value
<br />of the assets. Level 1 inputs are quoted prices in an active market for identical assets; Level 2 inputs are
<br />significant other observable inputs; and Level 3 inputs are significant unobservable inputs.
<br />
<br />The following is a summary of the fair value hierarchy of the fair value of investments of the City as of
<br />June 30, 2016:
<br />
<br /> Level 1 Level 2 Total
<br />Investments By Fair Value Level:
<br />18,458,907$ 18,458,907$
<br />U.S. Treasury Notes 14,563,897$ 14,563,897
<br />Medium-Term Notes 9,731,434 9,731,434
<br />Local Agency Investment Fund (LAIF) 55,352,984 55,352,984
<br />Supranationals 1,938,801 1,938,801
<br /> Total Investments 14,563,897$ 85,482,126$ 100,046,023
<br />Investments Measured at Amortized Cost:
<br />Held by fiscal agent:
<br />U.S. Treasury Money Market Funds 4,608,891
<br />Money Market Fund 10,014$ 10,014
<br />Total 10,014$ 104,664,928$
<br />Federal Agency Securities
<br />
<br />U.S. Treasury Note classified in Level 1 of the fair value hierarchy, valued at $14.5 million are valued
<br />using quoted prices in active markets. Federal agency securities totaling $18.4 million, medium term
<br />notes totaling $9.7 million and supranationals totaling $1.9 million, classified in Level 2 of the fair value
<br />hierarchy, are valued using matrix pricing techniques maintained by various pricing vendors. Matrix
<br />pricing is used to value securities based on the securities’ relationship to benchmark quoted prices. The
<br />California Local Agency Investment Fund (LAIF) classified in Level 2 is valued based on the fair value
<br />factor provided by the Treasurer of the State of California, which is calculated as fair value divided by the
<br />amortization cost of the investment pool. Fair value is defined as the quoted market value on the last
<br />trading day of the period. These prices are obtained from various pricing sources by our custodian bank.
<br />
<br />NOTE 3 – LOANS RECEIVABLE
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<br />At June 30, 2016, the City had loans receivable in the following funds:
<br />
<br />Governmental Funds:
<br />General Fund 3,610,335$
<br />Non Major Special Revenue Funds:
<br /> Affordable Housing Asset Special Revenue Fund 7,913,765
<br /> Community Development Block Grant (CDBG) 686,766
<br /> HOME Fund 3,335,000
<br /> Housing In-Lieu 637,000
<br /> Less allowance for uncollectible loans (12,024,624)
<br /> Total net loans receivable 4,158,242$
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