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CITY OF SAN LEANDRO <br />NOTES TO BASIC FINANCIAL STATEMENTS <br />For The Year Ended June 30, 2019 <br />NOTE 2 — CASH AND INVESTMENTS (Continued) <br />Fair Value Hierarchy <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 />The following is a summary of the fair value hierarchy of the fair value of investments of the City as of <br />June 30, 2019: <br />Investments By Fair Value Level: <br />Federal Agency Securities <br />U.S. Treasury Notes <br />Medium -Term Notes <br />Asset Backed Securities <br />Supranationals <br />Commercial Paper <br />Total Investments <br />Level Level Total <br />37,623,921 <br />$ 37,623,921 <br />Investments Exempt from Fair Value Hierarchy: <br />Local Agency Investment Fund (LAIF) <br />Investments Measured at Amortized Cost: <br />Held by fiscal agent: <br />U.S. Treasury Money Market Funds <br />Money Market Fund <br />Total <br />$ 27,195,934 <br />$ 27,195,934 <br />37,623,921 <br />26, 886,311 <br />26, 886,311 <br />7,267,010 <br />7,267,010 <br />4,417,518 <br />4,417,518 <br />3,582,336 <br />3,582,336 <br />$ 69,349,109 <br />106,973,030 <br />59,237,328 <br />553,930 <br />17,234,044 <br />$ 183,998,332 <br />U.S. Treasury Notes classified in Level 1 of the fair value hierarchy, are valued using quoted prices in <br />active markets. Federal agency securities, medium term notes, and supranationals, classified in Level 2 of <br />the fair value hierarchy, are valued using matrix pricing techniques maintained by various pricing <br />vendors. Matrix pricing is used to value securities based on the securities' relationship to benchmark <br />quoted prices. The California Local Agency Investment Fund (LAIF) 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 and is exempt from the Fair Value hierarchy. Fair value is <br />defined as the quoted market value on the last trading day of the period. These prices are obtained from <br />various pricing sources by the custodian bank. <br />061 <br />