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<br /> I <br /> I <br /> I- <br /> I ANNUAL REPORT OF INVESTMENT PROGRAM <br /> AND INVESTMENT ACTIVITY FOR THE <br /> CITY OF ARDEN HILLS <br /> I 1995 <br /> The City's Investment Policy requires that a comprehensive annual report be provided by <br /> I the Treasurer that summarizes the following: <br /> I Investment Strategies <br /> The investment strategy is to maximize return while meeting the daily cash needs of the <br /> I City and conforming to regulatory requirements. The objectives of safety and liquidity are <br /> balanced through the process of diversification while maintaining a market rate of return <br /> throughout budgetary and economic cycles. <br /> I Specifically, the objectives for 1995 were to maintain a position where the investment <br /> instruments were diversified by type as suggested by the policy diversification goals as <br /> I. well as by maturity. 1995 strategies were further impacted by the following conditions: <br /> a) Possible City HalllPublic Works garage facility funding requirements and the <br /> I aggressive 1995 pavement management program (i.e. County Rd. F and Stowe <br /> A venue reconstruction) caused the portfolio to be invested more strongly in cash <br /> I equivalents than the diversification goals suggested in the Investment Policy; <br /> b) The "hold" strategy employed at year-end 1994 for the City's investment in the <br /> . Piper Institutional Government Income Portfolio mutual fund proved sound when <br /> this investment was liquidated in June, 1995_ The share net asset value had <br /> recovered to a point where the City, at sell date, had incurred a cumulative return <br /> I of approximately 4.5% ($86,469) on this investment. <br /> c) As a result of the market risk inherent in mutual fund investments, the Citizen <br /> I Finance Committee recommended, and the Arden Hills City Council approved a <br /> modified City Investment Policy (Resolution No. 95-60). The modifications to the <br /> prior Investment Policy included eliminating non-money market mutual funds as <br /> I an investment category option, increasing the fixed rate instrument goal from fifty <br /> (50) to sixty-five (65) percent, and limiting fixed rate investments to federal debt <br /> obligations. <br /> I <br /> .- 1 <br /> I <br /> - -------- <br />