The URL can be used to link to this page

Home My WebLink About03-18-09 Chair Scott Bronson 1245 W. Highway 96 Committee Members Maurice Gieske AR EI HILLS Arden Hills, MN 55112 41111 _'�� (Vacant Seat) 651.792.7800 Jeff Johnson Arden Hills www.ci.arden-hills.mn.us James Ostlund Council Liaison Financial Planning and Stan Harpstead Analysis Committee March 18, 2009 City Vision A strong community that values our unique environment, our fiscal soundness, and our tradition as a desirable city in which to live, work, and play. Agenda Regular Committee Meeting Convenes 6:00 PM Call to Order 1. APPROVAL OF THE AGENDA 2. MINUTES A. February 10, 2009 - Regular Meeting 3. UNFINISHED AND NEW BUSINESS A. Gail Robertson. Ehlers &Associates, Inc. —Arbitrage and Post Issuance Compliance Policies* B. Pat Harris, 4M Fund Representative— Information on 4M Fund* • *Note: The speakers will provide handouts at the meeting. Staff have no additional handouts. 4. REPORTS A. Report from the City Council B. Financial Planning and Analysis Committee Comments and Requests 5. ADJOURNMENT A quorum of the City Council may be present at this meeting. MINUTES EN HILLS • FINANCIAL PLANNING &ANALYSIS COMMITTEE Tuesday,February 10,2008 6:00 P.M. Second Level Conference Room,Arden Hills City Hall CALL MEETING TO ORDER AND ROLL CALL The meeting was called to order by Jim Ostlund at 6:00 pm. MEMBERS PRESENT: Stan Harpstead, Council Liaison; Jeff Johnson;Maurice Gieske; Jim Ostlund MEMBERS NOT PRESENT: Scott Bronson OTHERS PRESENT: Arlene Mitchell,Communication Committee Member; Joe Rueb, Accounting Analyst; Lynn Cornwell,Wells Fargo Call to Order 1. APPROVAL OF THE AGENDA Motioned: Maurice Gieske Seconded: Jim Ostlund 2. APPROVAL OF October 14,2008 MINUTES as amended Motioned: Maurice Gieske • Seconded:Jim Ostlund 3. UNFINISHED AND NEW BUSINESS A. Review of City Investment Policy Harpstead brought a printout of a presentation he attended for the Regional Council of Mayors. The topic of the presenation was"Economic Update: You Ain't Seen Nothin' Yet"by William C.Melton. Harpstead provided an overview of the presentation. Cornwell provided the group with suggestions of changes for the investment policy. Her recommendations are as follows: • Section 1. Add"safety"and"liquidity"before"return"not after"return". Have it read"...invest public funds in a manner which maximizes safety and liquidity and provides maximum return." • Section 2.C. Consider removing or re-wording the last sentence regarding written acknowledgement for each transaction. May want consider a joint powers agreement with another city as a backup. • Section 3.B. If cash flow has a definition, state what it is. Keep in consideration six months of budgeted and CIP expenditures. Add a maximum term of five-ten years. • Section 5.4. Remove"form of a discounted security maturing in the"and add"FDIC"before insurance coverage. • City of Arden Hills 1245 West Highway 96•Arden Hills Minnesota 55112 Phone 651.792.7800•Fax 651.634.5137 www.ci.arden-hills.mn.us MINUTES EN HILLS • • Section 5.7. Add"and re-purchase agreements"after"Federal Agency Issues"as long as it is rated AAA by two rating agencies. Gives more flexibility. Make sure there is language about the 4M Fund. • Section 5.8. Change"step-up notes"to"step-up agency notes". • Section 6.4.D. Remove"other distinguishing marks"and replace with "cusips". • Section 7. Review the 5%figure for investing in securities of a single issuer. Decrease the 25%figure for external investment pool. • Section 8. Change"security dealers"to"broker dealers". B. Discussion on Current Economy and Financial Markets Cornwell brought handouts for discussion on the economy and markets. C. Update on City's 2009 Budget for Investment Interest and Current Forecast. Iverson provided an updated spreadsheet of the City's investments. 4. REPORTS A. Report from the City Council Mayor Harpstead updated the committee on previous Council actions and activities. • B. Financial Planning and Analysis Committee Comments and Requests NEXT MEETING—Tuesday,March 10, 2009 5. ADJOURNMENT Motioned: Jeff Johnson Seconded: Jim Ostlund Scott Bronson,Chair Susan K. Iverson,Finance Director • City of Arden Hills 1245 West Highway 96•Arden Hills Minnesota 55112 Phone 651.792.7800•Fax 651.634.5137 www.ci.arden-hills.mn.us • AIQEN HILLS MEMORANDUM DATE: March 13, 2009 TO: Financial Planning and Analysis Committee FROM: Sue Iverson, Finance Director SUBJECT: Policy Discussions—Investment and Arbitrage/Post Issuance Compliance BACKGROUND • Council directives have been that the Financial Planning and Analysis Committee look at fiscal policies and recommend changes. The Committee previously worked on an investment policy and is currently reviewing it to recommend changes. The City has never had a policy on Arbitrage or Post Issuance Compliance in the past and one needs to be established in order to be compliant. DISCUSSION I attended a session on Arbitrage Regulatory Issues and Post Issuance Compliance in February. Recent initiatives by the IRS have been to send compliance questionnaires to state and local governments and do formal audits. They are planning to hire a significant amount of new field workers to perform these audits. Although the City of Arden Hills currently only has one bond issue outstanding,we also have two conduit debt issues outstanding. In the course of attending these seminars, I found that we are liable for the reporting and record keeping for conduit debt also. This has been an area in the past that cities have not paid much attention to or it was thought that they had no liability in,but IRS regulations hold that the City is liable for these issues. Gail Robertson from Ehlers & Associates, Inc. will be in attendance to present sample policies and also to use our outstanding conduit debt issues as case studies to show how our policies should be developed and explain why. It will also govern how we determine if we will make future conduit offerings and the fees and trustee agreements we will require. Last month Lynn Cornwell from Wells Fargo Brokerage attended the meeting to give recommendations on suggested changes to the current investment policy. At this meeting there were some questions on the 4M Fund and the committees has in the past requested someone from this fund come and speak to the group. Pat Harris will be present to give information on this fund and to answer any questions the committee will have. This information will be valuable to the committee to use in recommending • changes to the investment policy. \Ahdocsl\ah\AHdata\Admin\Committees&Commissions\FPAC\3-13-09.doc Arbitrage/Post Issuance Compliance/Investment Policy Discussions • 3/13/2009 Page 2 Since we will be gathering information on these areas, we will not be working on the actual policies at this meeting. We will be carrying these discussions forward to the next committee meeting. ACTION No action is required. • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • Voyageur ASSET MANAGEMENT INC. ;` 4M FUND LFAGUF MINNFSU I,A Cliffs p . City of Arden Hills w� 6 ; 3. . • . 4101 ak �'p; '' •"eve' All material presented is compiled from sources believed to be reliable and current,but accuracy f` + � + cannot be guaranteed.As with all investments there are associated inherent risks.Please obtain and review all financial material carefully before investing.Additional information is available upon request. Institutional Services 100 South Fifth Street,Suite 2300 Minneapolis,Minnesota 55402.1240 800.553.2143•612.376.7000 www.voyageur.net • . • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • 4M FUND 4M FUND The 4M Fund was Developed by the League of Minnesota Cities to Provide a Safe and Competitive Investment • Professionally managed investment fund for Minnesota communities by a team of investment experts • Investment in 4M programs range from short, medium, to longer term based on a community's need for cash • Sponsored and governed by the League of MN Cities • Managed by Voyageur Asset Management since 1994 • All permitted investments under M.S. 118A T� LEAGUE,, VOyageUr ASSET MANAGEMENT INC. MINNEsoTA 2 CITIES s ! s • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • THREE DISTINCT 4M FUND OPTIONS 4M FUND 4M Fund — Liquid Asset Fund • Cash management 4M Plus Fund — Longer Term Fund: • Slightly longer term with minor restrictions Fixed Rate Program — Cash Flow Program — Bond proceeds management C GUETIES n: Voyageur ASSET MANAGEMENT INC. LEAMINNEsorn 3 CI • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • 4M & 4M PLUS FUNDS - 4M FUN Mau Safety Multiple Sub-Accounts Liquidity 4MFund.com Competitive Yield State Aid Wire Services No Minimum Balance Web Account Access and Transaction Capability 3 Investment Options Phone Transactions Instant Liquidity in 4M Credit Product Options Free Checking — Including Check Printing Voyageur ASSET MANAGEMENT INC. 4 • 411 • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • 4M FIXED RATE PROGRAM 4M FUND CD's and Other Fixed Rate Instruments Cash Flow Program Bond Proceeds Management Allows Organizations to Expand Their Investment Horizon to Meet Financial Needs For More Information, Call John Styrbicki at (800) 388-7125 T� �tnc u t VOyageUr ASSET MANAGEMENT INC. 14gal orn 5 CITIFS • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • 4M ONLINE ACCESS 4M FUND Simple, Efficient Way to Manage Cash Full Reporting Click of the Mouse Leads to Many Services Recent Upgrade Provides for Faster Service and Enhanced Reporting r, r; �EncuE ,� Voyageur ASSET MANAGEMENT INC. MwNEsorn 6 CITIES • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • 4M FUND CREDIT PRODUCTS -7- - 4M FUND Purchasing Card - The One Card: • Pooled purchasing benefits Credit Processing - Merchant Card Services: • Pooled fee benefits LEAGUE Voyageur ASSET MANAGEMENT INC. MINNESOIA 7 CITIES • . i • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • PUBLIC DOLLARS: SAFETY FIRST 4MFUND All Investments Adhere to M.S. 118a All Investments Backed by the Securities Themselves Policies Limit Investments to the Highest Credit Quality Fund is Managed in Accordance SEC Regulation 2A-7 — strict NAV policy Continuous Board and Regulatory Oversight Full Credit Research Staff and Committee Process No Exposure to CDO's, SIV's, Merrill Lynch, Lehman, AIG <,t I Voyageur ASSET MANAGEMENT INC. LEAGUE MwNEsorn 8 CITIES • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • 4M CURRENT FACTS 4M FUND 4M Fund Assets Under Management (as of 2.28.09) $271 ,663,647 4M PLUS Fund Assets Under Management (as of 2.28.09) $229,409,022 Over 330 Minnesota Public Entities Participating... en cut,,, Voyageur ASSET MANAGEMENT INC. L'agf orn g CITIES • s • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • WHY 4M? -- 4M FUND Professionally Managed — and Customized Numerous Features and Benefits — to Include Checking, Web Access, and Sub- Accounting Typically Higher Yields Security of Public Funds Expands a Community's Investment Options r f �EncuE +� Eso Voyageur ASSET MANAUEMEN I INC.. MwNrn 10 CITIES • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • FOR MORE INFORMATION 4MFUND Please Contact: Pat Harris Voyageur Asset Management Inc. 100 South Fifth Street, Suite 2300 Minneapolis, Minnesota 55402 612.376.7017 • 800.553.2143 pharris@voyageur.net www.4MFund.com LEAGUE : Voyageur ASSET MANAGEMENT INC. MINNESOIA 11 CITIES i • 411