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Home My WebLink AboutAudit Committee-Agenda Packets-8/10/2016City of Colleyville Page 1 City of Colleyville Audit Committee Agenda City Hall 100 Main Street Colleyville, Texas 76034 817.503.1000 www.colleyville.com Wednesday, August 10, 2016 4:30 p.m. City Manager’s Conference Room Third Floor – City Hall 1. CALL TO ORDER 2. APPROVAL OF MINUTES May 3, 2016 3. REGULAR AGENDA ITEMS 3a Meet with representatives(s) from the City's audit firm, Pattillo, Brown & Hill, L.L.P. to discuss the Fiscal Year September 30, 2016 audit 3b Discussion of update to City's Investment Policy 4. PRESENTATIONS Presentation of the quarterly investment report for the quarter ended June 30, 2016 5. ADJOURNMENT I hereby certify this agenda was posted on City Hall bulletin boards August 5, 2016, by 5:00 p.m. Amy Shelley, TRMC City Secretary A quorum of the Colleyville City Council and/or any other Colleyville Board, Commission, or Committee may be in attendance at this meeting. Any matter on this agenda may, at the discretion of the governing body, be opened for public comment and discussion. Audit Committee Agenda August 10, 2016 City of Colleyville Page 2 If you plan to attend this public meeting and have a disability that requires special accommodations, please advise Executive Secretary at least 48 hours in advance at 817.503.1111, and reasonable accommodations will be made to assist you. City of Colleyville Page 1 City of Colleyville Audit Committee Minutes - DRAFT City Hall 100 Main Street Colleyville, Texas 76034 817.503.1000 www.colleyville.com Tuesday, May 3, 2016 5:15 p.m. City Manager’s Conference Room Third Floor – City Hall Accounting Manager Karen Hines called the Audit Committee meeting to order on May 3, 2016, at 5:15 p.m. ROLL CALL: Committee members Nancy Coplen, Chuck Mogged, and Chris Putnam were present. City Manager Jennifer Fadden, Deputy City Manager Chris Fuller, Chief Financial Officer Brian Hogan, Accounting Manager Karen Hines, and City Secretary Amy Shelley were also present. 2. APPROVAL OF MINUTES March 8, 2016 The minutes of the March 8, 2016 Audit Committee were approved as presented. 3. REGULAR AGENDA ITEMS 3a Presentation of the quarterly investment report for the quarter ended March 31, 2016 Accounting Manager Karen Hines presented the quarterly investment report for the quarter ended March 31 2016. Committee member Mogged asked staff about investment maturity dates and if we had changed the length of our investments. Manager Hines mentioned that the average yield on investments for this quarter (0.55%) was 0.16% higher than the prior quarter’s average of 0.39%. CFO Hogan stated that we are replacing maturing investments with investments with slightly higher yields. However, since it is unlikely that the Fed will raise rates in the near future, we are safe with a two year investment maturity. Rates will not increase enough in that time frame to outpace the yields we are earning on the overnight investment pools. Manager Hines stated for this quarter we had one investment mature, and we bought three investments, all with slightly higher rates. Manager Hines stated the next meeting will be Tuesday, August 9, 2016 at 5:00 p.m. to discuss the FY16 audit, update the investment policy, and present the June 30, 2016 quarterly investment report. City of Colleyville Page 2 Audit Committee Minutes - Draft May 3, 2016 4.ADJOURNMENT The Audit Committee meeting adjourned at 5:20 p.m. APPROVED BY A VOTE OF AYES, NAYS, AND ABSTENTIONS ON THIS THE 10TH DAY OF AUGUST 2016. Minutes taken and prepared by: Amy Shelley, TRMC City Secretary City of Colleyville Page 1 City of Colleyville Audit Committee Agenda Briefing City Hall 100 Main Street Colleyville, Texas 76034 www.colleyville.com Agenda Number 3a Agenda Date 08/10/2016 Number 2a Type Regular Agenda Items Department City Manager Title Meet with representatives(s) from the City's audit firm, Pattillo, Brown & Hill, L.L.P. to discuss the Fiscal Year September 30, 2016 audit Strategy Map Connection B4- Cultivate a culture of transparency and consistent communication F4- Adhere to the City’s financial and budgetary policies Explanation Nicole Bradshaw, who is a manager with the City's audit firm Pattillo, Brown and Hill, L.L.P., will meet with the Audit Committee to discuss the Fiscal Year September 30, 2016 audit. Attachments City of Colleyville Page 1 City of Colleyville Audit Committee Agenda Briefing City Hall 100 Main Street Colleyville, Texas 76034 www.colleyville.com Agenda Number 3b Agenda Date 08/10/2016 Number 2b Type Regular Agenda Items Department City Manager Title Discussion of update to City's Investment Policy Strategy Map Connection B4- Cultivate a culture of transparency and consistent communication F4- Adhere to the City’s financial and budgetary policies Explanation The most recent legislative session approved updates to the Public Funds Investment Act, which governs the City's investment process and investment policy. To be compliant with the updates, attached is the City's Investment Policy with proposed revisions. Additionally, staff has incorporated revisions to update the names of the investment officers in the policy. Following the Audit Committee's consideration, these proposed changes will be presented for City Council consideration as an amendment to the investment policy ordinance for first reading at the September 6, 2016 City Council meeting. Major changes by section: Delegation of Authority The City designates the Investment Officers to be the City Manager with overall responsibilities to see that investment objectives are accomplished and the Chief Financial Officer and Accounting Manager with the specific day-to-day performance of managing the funds of the City. Prudence The Investment Officers of the City (City Manager, Chief Financial Officer, and Accounting Manager) shall be personally indemnified in the event of investment loss provided the Investment Policy is followed. Internal Controls The Chief Financial Officer and Accounting Manager shall establish a system of written internal controls which shall be reviewed annually by the independent auditor. Safekeeping Either the City Manager, Chief Financial Officer or Accounting Manager must approve release of collateral in writing prior to its removal from the safekeeping account. Audit Committee Agenda Briefing 3b City of Colleyville Page 2 Reporting Requirements The Chief Financial Officer and Accounting Manager shall issue a written report quarterly to the Audit Committee and City Council concerning the City's investment transactions for the preceding quarter and describing in detail the investment position of the City as of the end of the quarter indicating the market values of all investments held during the quarter. The report shall be signed by the Chief Financial Officer and Accounting Manager, as the investment officers for the City, and state its compliance with the Public Funds Investment Act and adopted investment policy strategy. Training Requirements In accordance with the Act (2256.005 and 2256.008), the Chief Financial Officer and Accounting Manager shall attend 10 hours of investment training within 12 months of assuming duties and 8 hours not less than once in a two-year period that begins on the first day of the City’s fiscal year and consists of the two consecutive fiscal years after that date. Investment Strategy A section in the Public Funds Investment Act requires that the governing body of a public entity review the investment strategy annually. The City's investment strategy is contained in the section of the City of Colleyville Investment Policy entitled "Investment Strategy", and will be presented for the City Council's review, when the above changes are proposed to City Council. There are no changes proposed in the existing investment strategy. Attachments 1.City Investment Policy - Proposed Changes CITY OF COLLEYVILLE INVESTMENT POLICY Policy It is the policy of the City of Colleyville (the City) to invest public funds in a manner which will provide the highest investment return with the maximum security while meeting the daily cash flow demands of the entity and conforming to all State of Texas laws and statutes including the Public Funds Investment Act, Chapter 2256 of the Government Code and City ordinances. Scope This investment policy applies to all financial assets of the City. These funds are accounted for in the City's Comprehensive Annual Financial Report and include: • General Fund • Special Revenue Funds • Capital Projects Funds • Enterprise Funds • Debt Service Funds, including reserves and sinking funds • Trust and Agency Funds, to the extent not required by law or existing contract to be kept segregated and managed separately and any new fund created by the City Council, unless specifically exempted by the City Council or by law. All funds may be combined as pooled funds unless specifically prohibited by State law or statute or City ordinance. Objectives The primary objectives, in priority order, of the City’s investment activities shall be: Safety: Safety of principal is the foremost objective of the City in managing its portfolio. Investments of the City shall be undertaken in a manner that seeks to ensure the preservation of capital in the overall portfolio. To attain this objective the City will diversify its investments by investing funds among a variety of securities offering independent returns and financial institutions. The City will also take into account the marketability of the investment if the need arises to liquidate the investment before maturity. Liquidity: The City will also maintain sufficient liquidity to provide adequate and timely working funds. Return on Investments: The investment portfolio shall be designed with the objective of obtaining a rate of return throughout budgetary and economic cycles, commensurate with the investment risk constraints and cash flow needs. The City investment strategy is passive and the portfolio shall be designed with the objective of regularly exceeding the weighted average return on thirteen-week Treasury bills. This is considered a benchmark for riskless investment transactions, and therefore, is a minimum standard for the portfolio's rate of return. For bond funds that fall under the arbitrage provisions of the Tax Reform Act of 1986, the City will attempt to earn allowable bond yield with market conditions permitting. Delegation of Authority The City designates the Investment Officers to be the City Manager with overall responsibilities to see that investment objectives are accomplished and the Finance Manager Chief Financial Officer and Assistant Finance Accounting Manager with the specific day-to-day performance of managing the funds of the City. Ethics and Conflict of Interest All investment Officers and employees involved in the investment process shall refrain from personal business activity that could conflict with proper execution of the investment program, or that could impair their ability to make impartial investment decisions. Employees shall disclose to the City of Colleyville and Texas Ethics Commission a statement under the following conditions: A. If they have a personal business relationship with a business organization offering to engage in an investment transaction with the entity. Under the Public Funds Investment Act, a personal business relationship is defined as: 1. The investment officer owns 10 percent or more of the voting stock or shares of the business organization or owns $5,000 or more of the fair market value of the business organization: 2. Funds received by the investment officer from the business organization exceed 10 percent of the investment officer's gross income for the previous year; or 3. The investment officer has acquired from the business organization during the previous year, investments with a book value of $2,500 or more for the personal account of the investment officer. B. If they are related within the second degree by affinity or consanguinity, as determined by Chapter 573 V.A.T.C.S. to an individual seeking to sell an investment to the City of Colleyville. Prudence Investments shall be made with judgement and care – under circumstances then prevailing – which persons of prudence, discretion, and intelligence exercise in the management of their own affairs, not for speculation, but for investment, considering the probable safety of their capital as well as the probable income to be derived. The standard of prudence to be used by investment officials shall be the "prudent person", which means the officer may not be an expert but is obligated to act responsibly and shall be applied in the context of managing an overall portfolio. Investment officers acting in accordance with written procedures and exercising due diligence shall be relieved of personal responsibility for an individual security's credit risk or market price changes, provided deviations from expectations are reported in a timely fashion and appropriate action is taken to control adverse developments. Investment officers shall notify the City Council in writing of any conflicts of interest, as defined by the Public Funds Investment Act, no later than the next regularly scheduled Council meeting. It is the policy of the City that the Investment Officers perform their duties in accordance with the policies and procedures set forth in this policy. The Investment Officers of the City (City Manager, Chief Financial Officer and Finance Accounting Manager., and Assistant Finance Manager) shall be personally indemnified in the event of investment loss provided the Investment Policy is followed. Internal Controls The Chief Financial Officer and Finance Accounting Manager and Assistant Finance Manager shall establish a system of written internal controls which shall be reviewed annually by the independent auditor. The controls shall be designed to prevent the loss of public funds due to fraud, error, misrepresentation, unanticipated market changes or imprudent actions. Permissible Instruments The following is a list of permissible instruments as authorized by the 70th Texas Legislature in the Public Funds Investment Act (TEX. REV. CIV. STAT. ANN. ACT 842A-2) and amended by the 71st Legislature: 1. Obligations of the United States or its agencies or instrumentalities; 2. Direct obligations of the State of Texas or its agencies; 3. Other obligations, the principal of and interest on which are unconditionally guaranteed or insured by the State of Texas or the United States or its agencies or instrumentalities; 4. Obligations of states, agencies, counties, cities, and other political subdivisions of any state having been rated as to investment quality by nationally recognized investment rating firm and having received a rating of not less than "A" or its equivalent; 5. Certificates of deposit issued by state and national depository institutions that have its main office or branch office in this state that are: a. Guaranteed or insured by the Federal Deposit Insurance Corporation, FSLIC or its successors; or b. Secured by obligations that are described by subdivisions (1) through (4) of this subsection, which are intended to include all direct federal agency or instrumentality issued mortgage backed securities, and which have a market value of not less than the principal amount of the certificates or in any other manner and amount provided by law for deposits of the investing entities; 6.Invest in a local government investment pool as authorized by the Interlocal Cooperation Act (TEX. REV. CIV. STAT. ANN. ACT. 4413 (32c), as amended, and the Public Funds Investment Act (TEX. REV. CIV. STAT. ACT. 842a-2), as amended. The investment pool must comply with the requirements of the Public Funds Investment Act, as amended, as follows: a.The investment pool maintains a stable asset value of one dollar as defined in the Public Funds Investment Act; b.The investment pool maintains a AAA, or AAAm rating by one of the nationally recognized rating agencies; c.The investment pool's maximum average dollar weighted maturity does not exceed 90 days; and d.The investment pool's continued compliance with the remaining provisions of the Public Funds Investment Act. e.The eligible investments of the pool are as follows: obligations of the United States or its agencies and instrumentalities, other obligations, the principal of and interest on which are unconditionally guaranteed or insured by the United States, fully collateralized repurchase agreements with a defined termination date secured by obligations of the United States or its agencies and instrumentalities, other obligations, the principal of and interest on which are unconditionally guaranteed or insured by the United States, and SEC registered money market funds authorized by the Public Funds Investment Act and rated in the highest category by at least one nationally recognized rating agency, reverse repurchase agreements with a term of no longer than 90 days. f.Include in its investment policy and/or operating procedures the following information: a description of eligible investment securities and unacceptable investments, a written statement on investment policy and objectives, a description of interest calculations, distribution, and treatment of gains and losses, security safeguarding, valuation collateralization and auditing, and a fee schedule. 7.Direct repurchase agreements with primary security dealers or financial institutions doing business in the State of Texas having a defined termination date, and secured by U.S. Government or federal agency securities, provided that the ownership of collateral for the repurchase agreement is transferred to the City, and deposited with a safekeeping agent for the duration of the contract and a signed master repurchase agreement has been executed with the counterparty. 8.SEC-registered no-load money market mutual funds with a dollar weighted average portfolio of 90 days or less whose assets consist exclusively of United States Government Securities whose investment objectives include seeking to maintain a stable net asset value of $1.00 per share. Investment in mutual funds shall be limited to a maximum of ten percent (10%) of the City's available funds. 9.Certificate of Deposit Account Registry Service (CDARS) deposited with a certificate of deposit issued by a depository institution that has its main office or branch office in this state that is selected by the investing entity pursuant to the requirements of Section 2256.010 of the Government Code. The City is not required to liquidate an investment that was authorized at the time of its purchase. Unacceptable Investment Instruments The following securities, although authorized by the Public Funds Investment Act, are not eligible investments for the City: 1.Collateralized mortgage obligations and/or obligations of the following structure a)obligations whose payment represents the coupon payments on the outstanding principal balance of the underlying mortgage- backed security collateral and pays no principal; b)obligations whose payment represents the principal stream of cash flow from the underlying mortgage-backed security collateral and bears no interest; c)collateralized mortgage obligations that have a stated final maturity date of greater than 10 years; and d)collateralized mortgage obligations the interest rate of which is determined by an index that adjusts opposite to the changes in a market index. 2.Commercial paper 3.Banker's acceptances 4.Reverse repurchase agreements (Local Government Investment Pools which the City participates in may engage in reverse repurchase agreements if the term is 90 days or less) 5.No-load mutual funds other than SEC-registered no-load money market mutual funds with a dollar weighted average portfolio of 90 days or less whose assets consist exclusively of United States Government Securities whose investment objectives include seeking to maintain a stable net asset value of $1.00 per share. 6.Guaranteed investment contracts 7.Share certificates of qualifying credit unions Effect of Loss of Required Rating An investment that requires a minimum rating does not qualify as an authorized investment during the period the investment does not have a minimum rating. The Investment Officer shall take all prudent measures that are consistent with the City’s investment policy to liquidate the investment(s) that does not have the minimum rating (2256.021). In accordance with Section (2256.005(b)), the Investment Officer shall monitor rating changes in current investments by keeping a monthly record of ratings issued by three nationally recognized rating agencies. Investment Strategy The investment strategy by type of fund is as follows: (1) Operating Funds The investment strategy for operating fund(s) is to assure that anticipated cash flows are matched with adequate investment liquidity. A secondary objective is to create a portfolio, which will experience minimum volatility during economic cycles. These funds shall not have an investment with a stated maturity greater than two years and the weighted average maturity shall not exceed eighteen months. (2) Debt Service Funds The investment strategy for debt service fund(s) is the assurance of investment liquidity to cover the debt service obligations on the required payment date. Investments purchased shall not have a stated final maturity date which exceeds the corresponding debt service payment date. The weighted average maturity shall not exceed one year. (3) Reserve Funds The investment strategy for reserve fund(s) is the assurance of investment liquidity adequate to cover the debt service obligations not funded by debt service funds on the required payment date. Investment of reserve funds are controlled by their ordinance, resolution or indenture, and Federal and State law. Bond documents must be examined for each issue, for potential differences with this policy concerning investment instruments, maximum maturity or average life restrictions, call dates or sinking fund redemptions, and applicable arbitrage yields and rebate liability. Provisions contained in the bond documents will supersede provisions of this policy. Weighted average maturity shall be incompliance with bond requirements, as stated. Reserve funds will be invested using a more conservative approach than the current standard investment strategy when arbitrage rebate rules require refunding excess earnings. All excess earnings received will be segregated to allow a proper determination of interest income to be used in the arbitrage calculation. (4) Special Project or Special Purpose Funds The investment strategy for special projects or special purpose fund portfolio(s) will have as their primary objective to assure that anticipated cash flows are matched with adequate investment liquidity. The city’s final maturity dates of securities held shall not exceed the estimated project completion date. Funds in excess of defined construction payment schedules shall be limited to a maximum final maturity date of three years. Maturity limitations for single issue reserve funds shall not exceed the sooner of five (5) years, the call provisions of the bond ordinance, or the final maturity of the bond issue. Annually, the City Council shall formally review the Investment Policy and investment strategy contained with the Policy and record in writing that it has reviewed the Policy and record any changes to either the policy or strategy. A. Diversification The City will attempt to limit the risk of loss through diversification of its portfolio and to achieve the aforementioned investment strategies by diversification of instruments. Diversification by Instrument of Portfolio Maximum Percent U.S. Treasury Obligations (Bills, Notes and Bonds), 100% U.S. Government Agency Securities, and Instrumentalities of Government Sponsored Corporations 75% Certificates of Deposit (CD's) Commercial Bank's 75% Local Government Investment Pool 75% Certificate of Deposit Account Registry Service (CDARS) 75% Tri-Party Repurchase Agreement 75% SEC registered, no-load mutual fund 10% Investment Procedures The City shall enter the following agreements (if applicable): safekeeping, PSA repurchase agreements, wire transfer agreements, banking services contracts, and collateral/depository agreements. These contracts shall include the explicit delegation of authority to persons responsible for the transactions involving these agreements. No person except those designated in the contract may engage in any investment transactions. On all funds invested in instruments as listed in "Permissible Investments" numbers one through five, oral bids shall be requested from at least two broker/dealers or national banks. The City will accept the bid that provides the highest rate of return within the maturity required and within the parameters of this policy. Records will be kept of the bids offered, bids accepted, and a brief explanation of the decision that was made regarding the investment. Qualified Institutions Annually, the City Council shall approve four financial institutions for investment purposes as recommended by the Chief Financial Officer Finance Manager. All firms shall answer the Broker/Dealer questionnaire (Appendix A) and submit their most recent audited financial statements to the City Council for evaluation of credit worthiness. All personnel in the firms who will be trading or quoting securities to the City Council must maintain a current NASD license and be registered to deal securities in the State of Texas. An investment certification form (Appendix B) on the firm's letterhead signed by a principal of the firm must be on file with the City. Safekeeping All marketable securities purchased by the City shall be held in third party safekeeping by an institution designated as primary agent. All securities will be delivered to the third party institution by seller. Personnel in the third party institution will verify the correct security was delivered by the seller ("delivery vs payment"). The third party institution shall issue a safekeeping receipt to the City listing the specific instrument, rate/yield, maturity, CUSIP, and other pertinent information. Collateral on deposit type securities which exceed the FDIC coverage shall be held in a third party safekeeping institution. In the event a third party safekeeping institution is used, a collateral agreement shall be executed between the City Council, depository which pledged the collateral, and the third party custodian of the collateral. The City will retain possession of all original safekeeping receipts and the receipts will state the security is pledged to the City. Either the City Manager, Chief Financial Officer or Finance Accounting Manager, or the Assistant Finance Manager must approve release of collateral in writing prior to its removal from the safekeeping account. Selection of Financial Institutions Depositories shall be selected through the City's banking services procurement process, which shall include a formal request for application. In selecting depositories, the services available, service costs, and credit-worthiness of institutions shall be considered, and the Investment Officers, shall conduct a comprehensive review of prospective depositories' credit characteristics and financial history. The City shall select financial institutions from which the City may purchase certificates of deposit in accordance with the Act and this Policy. The City will have a written depository agreement with any financial institution with whom the City has time or demand deposits. The Investment Officer shall monitor the financial condition of financial institutions where certificates of deposit are held. A qualified representative of the financial institution must sign the investment certification form (Appendix B) on the financial institutions letterhead and it must be kept on file with the City. Collateral Securities for Certificates of Deposit and Demand Accounts The City will accept as collateral for its Certificates of Deposit and demand accounts the following securities: A. FDIC coverage B. U.S. Treasury bills, notes and bonds C. United States Agency and instrumentalities bills or notes D. GNMA mortgage backed fully modified pass through securities E. Texas state, city, county or school bonds with a remaining maturity of seven years or less and a rating of "A" or better by Moody's, Fitch Ratings, and Standard and Poor's. F. Surety Bond G. Federal Home Loan Bank Letter of Credit issued to the City Collateral shall be "marked to market" monthly by the Finance Manager. The following percentages constitute the minimum market value for collateral instruments that are pledged for the City's Certificates of Deposit and demand deposits. Form of Collateral Pledged Collateral Ratio 1. U.S. Treasury bills, notes, and bonds a. maturing within 1 year 102% b. maturing in 1-5 years 105% c. maturing in more than 5 years 110% 2. Actively traded U.S. Government Agency securities a. maturing in less than 1 year 103% b. maturing in 1-5 years 107% c. maturing in more than 5 years 115% 3. GNMA mortgage pass through securities 115% 4. Entities in the State of Texas bonds General Obligation Bonds a. maturing in less than 1 year 102% b. maturing in 1-5 years 105% c. maturing in more than 5 years 107% Revenue Bonds a. maturing in less than 1 year 105% b. maturing in 1-5 years 110% c. maturing in more than 5 years 115% Collateral shall be audited annually be the City's independent auditor and may be audited by the City at anytime during normal business hours of the safekeeping bank. Arbitrage The Tax Reform Act of 1986 places limitations on the City's yield from investing certain tax-exempt bond proceeds, debt service funds and reserve funds. The rebate provisions require that the City compute earnings on investments from certain issues of bonds on a periodic basis to determine if rebate is required. To determine the City's arbitrage position, the City is required to calculate the actual yield earned on the investment of the funds and compare it to the yield that would have been earned if the funds had been invested at a rate equal to the yield on the applicable bonds sold by the City. The rebate provisions state that periodically (not less than once every five years and not later than sixty days after maturity of the bonds), the City is required to pay the United States Treasury a rebate of any excess earnings. These restrictions require extreme precision in the monitoring and record keeping of investments, particularly in computing yields to ensure compliance. Failure to comply can dictate that the bonds become taxable, retroactively from the date of issuance. The investment strategy for bond funds which fall under the arbitrage provisions of the Tax Reform Act of 1986, is that the City will attempt to earn maximum allowable bond yield with market conditions permitting. Reporting Requirements The Chief Financial Officer and Finance Accounting Manager and Assistant Finance Manager shall issue a written report quarterly to the Audit Committee and City Council concerning the City's investment transactions for the preceding quarter and describing in detail the investment position of the City as of the end of the quarter indicating the market values of all investments held during the quarter. The report shall list for each investment held during the quarter: the purchase price of the investment, the par value of the investment, the market value of the investment at the beginning of the quarter, market value of the investment at the end of the quarter, and fully accrued interest for the period. The portfolio shall be marked to market monthly and market pricing information is to be obtained through the use of appropriate external third party software, third party safekeeping service, or a third party independent pricing service. This report shall be in compliance with provisions of the Public Funds Investment Act, as amended. The report shall be signed by the Chief Financial Officer and Finance Accounting Manager and Assistant Finance Manager, as the investment officers for the City, and state its compliance with the Public Funds Investment Act and adopted investment policy strategy. The quarterly investment reports must be reviewed annually by the City’s external audit firm as a part of the City’s annual audit and reported to the City Council. Training Requirements In accordance with the Act (2256.005 and 2256.008), the Chief Financial Officer and Finance Accounting Manager and Assistant Finance Manager shall attend 10 hours of investment training within 12 months of assuming duties and 8 hours not less than once in a two-year period that begins on the first day of the City’s fiscal year and consists of the two consecutive fiscal years after that date. Both the Chief Financial Officer and Finance Accounting Manager and Assistant Finance Manager shall complete ten hours of training every two years as required by the Public Funds Investment Act. This training may be obtained from the following sources: North Central Texas Council of Governments, Government Treasurer's Organization of Texas, Government Finance Officer's of Texas, Texas Municipal League or the University of North Texas Center for Professional Development. The training must include education in investment controls, security risks, strategy risks, market risks, and any other topics as required by the Public Funds Investment Act. GLOSSARY AGENCIES - Federal agency securities and/or Government-sponsored entities. BENCHMARK – A comparative base for measuring the performance or risk tolerance of the investment portfolio. A benchmark should represent a close correlation to the level of risk and the average duration of the portfolio’s investments. BROKER – A broker brings buyers and sellers together for a commission. CERTIFICATE OF DEPOSIT – A time deposit with a specific maturity evidenced by a certificate. Large- denomination CD’s are typically negotiable. COLLATERAL – Securities, evidence of deposit, or other property which a borrower pledges to secure repayment of a loan. Also refers to securities pledged by a bank to secure deposits of public monies. DEALER – A dealer, as opposed to a broker, acts as a principal in all transactions, buying and selling for his own account. DELIVERY VERSUS PAYMENT – Delivery verses payment is the delivery of a security and there is an exchange of money after the delivery of the security. DISCOUNT SECURITIES – Non-interest bearing money market instruments that are being issued at a discount and redeemed at maturity for full face value, e.g. Treasury Bills. DIVERSIFICATION – Dividing instruments among securities offering independent returns. FEDERAL CREDIT AGENCIES – Agencies of the Federal government set up to supply credit to various classes of institutions and individuals e.g. savings and loans, small business firms, students, farmers, farm cooperatives, and exporters. FEDERAL DEPOSIT INSURANCE CORPORATION (FDIC) – A federal agency that insures bank deposits, currently up to $100,000 per deposit. FEDERAL HOME LOAN BANKS (FHLB) – Government sponsored regional wholesale banks which lend funds and provide correspondent banking services to member commercial banks, thrift institutions, credit unions and insurance companies. `The mission of the FHLB is to liquefy the housing related assets of its members who must purchase stock in their district bank. FEDERAL NATIONAL MORTGAGE ASSOCIATION (FNMA) – FNMA, like GNMA was chartered under the Federal National Mortgage Association Act in 1938. It is a federal corporation and the largest single provider of residential mortgage funds in the United States. FNMA’s securities are highly liquid and widely accepted. FNMA assumes and guarantees that all security holders will receive timely payment of principal and interest. GOVERNMENT NATIONAL MORTGAGE ASSOCIATION (GNMA) – Securities influencing the volume of bank credit guaranteed by GNMA and issued by mortgage bankers, commercial banks, savings and loan associations. Security holder is backed by the full faith and credit of the US Government. LIQUIDITY – An asset that can be converted quickly and easily to cash. LOCAL GOVERNMENT INVESTMENT POOL – An investment by local governments in which their money is pooled as a method for managing local funds. MARKET VALUE – The price at which a security is trading and could presumably be purchased or sold. MASTER REPURCHASE AGREEMENT – A written contract that establishes each party’s rights in the transactions. A master agreement will specify, among other things, the right of the buyer-lender to liquidate the underlying securities in the event of default by the seller-borrower. MATURITY – The date upon which the principal or stated value of an investment becomes due and payable. MUTUAL FUND – An investment company that pools money and can invest in a variety of securities, including fixed-income securities and money market instruments. Mutual funds are regulated by the Investment Company Act of 1940 and must abide by Securities and Exchange disclosure guidelines. PORTFOLIO – Collection of securities held by an investor. PRIMARY DEALER – A group of government securities dealers who submit daily reports of market activity and positions and monthly financial statements to the Federal Reserve Bank of New York and are subject to informal oversight. PRUDENT PERSON RULE – An investment standard outlining fiduciary responsibilities of public funds investors relating to investment practices. RATE OF RETURN – The yield obtainable on a security based on its purchase price or its current market price. REPURCHASE AGREEMENT – An agreement of one party to sell securities at a specified price to a second party and a simultaneous agreement of the first party to repurchase the securities at a specified price or at a specified later date. REVERSE REPURCHASE AGREEMENT – An agreement of one party to sell securities at a specified price to a second party and a simultaneous agreement by the first party to resell the securities at a specified price to the second party on demand or at a specified date. SAFEKEEPING – Holding of assets (e.g. securities) by a financial institution. TREASURY BILLS – A non-interest bearing discount security issued by the US Treasury to finance the national debt. Most bills are issued to mature in three months, six months, or one year. The yields on these bills are monitored closely for interest rate trends. TREASURY BONDS – Long term US government debt securities with maturities of ten to thirty years. TREASURY NOTES – Intermediate term US government debt securities with maturities of one to ten years. YIELD – The current rate of return on an investment security generally expressed as a percentage of the securities current price. City of Colleyville Page 1 City of Colleyville Audit Committee Agenda Briefing City Hall 100 Main Street Colleyville, Texas 76034 www.colleyville.com Agenda Number Agenda Date 08/10/2016 Number Type Regular Agenda Items Department City Manager Title Presentation of the quarterly investment report for the quarter ended June 30, 2016 Strategy Map Connection F4- Adhere to the City’s financial and budgetary policies Explanation During the period of April 1, 2016 through June 30, 2016, the City of Colleyville had an average of $52,454,642 invested on a daily basis, which earned $79,635, with an average yield of 0.61%. The average yield on investments for this quarter is 0.06% higher than the prior quarter's average of 0.55%. As of June 30, 2016, the City had $53,234,961 invested in the LOGIC Investment Pool, CDARS Certificates of Deposit, and various debt instruments in the following percentages: Logic 44.85% FFCB Notes 14.84% FHLB Notes 19.91% FHLMC Notes 5.63% Treasury Note 2.44% CDARS CD's 8.57% FNMA Notes 3.76% These percentages are within the guidelines for portfolio diversification in the City's investment policy. The market value of the City's investments on June 30, 2016 was $24,854,961 as compared to a purchase price of $24,831,201 (this excludes LOGIC Investment Pool and CDARS Certificates of Deposit). The Colleyville Economic Development Corporation currently holds a Treasury Note ($500,000) with a market value of $500,489 and a purchase price of $499,750. Additionally, $1,002,126 was invested in the Corporation's name in the LOGIC Investment Pool. These funds earned interest of $2,158 for the quarter. Attachments 1.June 30, 2016 Quarterly Investment Report 2.DFW Economic Indicators - June 2016 3.Legislative Changes - Effective 9/1/2015 QUARTERLY INVESTMENT REPORT FOR QUARTER ENDING JUNE 30, 2016 THIS REPORT IS IN COMPLIANCE WITH THE PUBLIC FUNDS INVESTMENT ACT AND ADOPTED INVESTMENT POLICY STRATEGY OUTSTANOING INVESTMENTS AT JUNE 30. 2016 PURCHASE PAR MARKET VALUE MATURITY YIELD ON PRICE VALUE @6130116 DATE INVESTMENT fHLB NOTE $1 ,000,590 $1 ,000.000 $1 .000,338 1011712016 0.470% ff CB NOTE $1 ,015 ,700 $1 ,000 ,000 $1 ,005 ,534 1112212016 0.375% fHLB NOTE $1 .201 ,546 $1 .200,000 $1 ,200 ,644 1112312016 0.560% fHLB NOTE $1 .301 ,01 4 $1 ,300 ,000 $1 ,301 ,494 1211212016 0.660% TREASURY NOTE $1 ,301 ,219 $1 ,300,000 $1,301 ,331 1211512016 0.562% FHLB NOTE $1 ,003 ,800 $1 ,000.000 $1 ,003 ,460 4n12011 0.735% FHLB NOTE $750,000 $750 ,000 $751 ,913 611212017 0.820% ff CB NOTE $1 .001 ,230 $1 ,000,000 $1 ,001 ,651 611612017 0.735% fHLB NOTE $1 ,000.390 $1 ,000,000 $1 .001.888 613012 017 0.710% fHLMC NOTE $1 ,004,385 $1 ,000.000 $1 ,003 .647 712812017 0.600% ffCB NOTE $1 ,003.690 $1 ,000.000 $1 ,001 .408 812812017 0.580% ffCBNOTE $1 ,000,000 $1 .000,000 $1 ,001 ,915 911412017 0.780% ff CB NOTE $897 ,660 $900 .000 $900 ,653 1011312017 0.785% fHLB NOTE $1,199,868 $1 ,200,000 $1 ,200,427 10/2612017 0.630% FNMA NOTE $999 ,800 $1 ,000 .000 $1 ,003,482 10/2612017 0.885% ff CB NOTE $999 ,000 $1 .000,000 $1 ,001 ,786 111612017 0.811% fHLB NOTE $750,750 $750.000 $755 , 134 121812017 1.072% fHLB NOTE $1 ,200.000 $1 ,200 ,000 $1 .202 ,699 1212912017 1.010% ff CB NOTE $1 ,000.580 $1 .000.000 $1 .002 ,069 211212018 0.771% fHLMC NOTE $999 .030 $1 .000,000 $1 .001 ,843 Jn/2018 0.925% fHLMC NOTE $999,850 $1 .000 ,000 $1 ,001 ,152 41912018 0.758% FNMA NOTE $1 ,003 ,700 $1 ,000 .000 $1 ,005 ,737 413012018 0.811% ff CB NOTE $997 ,400 $1 ,000,000 $1 ,001 ,182 5/1612018 0.882% fHLB NOTE $1 .200 ,000 $1 .200,000 $1 ,203 ,574 61512018 0.850% TOTAL OUTSTANDING INVESTMENTS $24 .831 .201 $24 .800,000 $24 .854 ,961 CITY Of COLLEYVILLE BALANCES AT JUNE 30, 2016 INVESTMENT PURCHASES $24 .800.000 COAR'S CERTIFICATES Of DEPOSIT $4 ,561 ,235 LOGIC INVESTMENT POOL $23 .873 ,726 TOTAL CITY INVESTMENTS HELO AT JUNE 30, 2016 $53 .234 ,961 COLLEYVILLE ECONOMIC DEVELOPMENT CORPORATION (CEOC) BALANCES AT JUNE 30, 2016 INVESTMENT PURCHASES $500 ,000 LOGIC INVESTMENT POOL $1 ,002 ,126 TOTAL CEOC INVESTMENTS HELO AT JUNE 30. 2016 $1 .502 .126 !TOTAL INVESTMENTS HELO BY CITY Of COLLEYVILLE !ANO COLLEYVILLE ECONOMIC DEVELOPMENT CORPORATION AT JUNE 30. 2016 $54 .737 ,087 INTEREST EARNINGS ON CITY OF COLLEYVILLE INVESTMENTS FOR THE PERIOD OF APRIL 1 -JUNE 30 , 2016 PURCHASE PAR MAT URITY YIELD ON INTEREST PRICE VALUE DATE INVESTMENT EARNED FFCB NOTE $1 ,004 ,070 $1 ,000 ,000 5/9/2016 0 .375% $401 FHLB NOTE $1 , 198,200 $1 ,200 ,000 6/10/2016 0.450% $1 ,050 FHLB NOTE $1,000,590 $1 ,000 ,000 10/17/2 0 16 0.470% $1,172 FFCB NOTE $1 ,0 15,700 $1 ,000 ,000 11 /22/2016 0 .375% $936 FHLB NOTE $1 ,201 ,546 $1 ,200 ,000 11/23/2016 0 .560% $1 ,676 FHLB NOTE $1 ,301,014 $1 ,300 ,000 12/12/2016 0.660% $2 ,140 TREASURY NOTE $1 ,301 ,219 $1 ,300 ,000 12/15/2016 0 .562 % $1 ,822 FHLB NOTE $1 ,003,800 $1 ,000 ,000 4/7/2017 0 .735% $1 ,833 FHLB NOTE $750 ,000 $750 ,000 6/12/2017 0 .820% $1 ,533 FFCB NOTE $1 ,001 ,230 $1,000,000 6/16/2017 0.735% $1 ,833 FHLB NOTE $1 ,000,390 $1 ,000 ,000 6/30/2017 0.710 % $1 ,771 FHLMC NOT E $1 ,004 ,385 $1 ,000 ,000 7/28 /2017 0 .600% $1.496 FFCB NOTE $1 ,003,690 $1,000,000 8/28/2017 0 .580% $1 ,446 FFCB NOTE $1 ,000 ,000 $1 ,000 ,000 9/14/2017 0.780% $1 ,945 FFCB NOT E $897,660 $900 ,000 10/13/2017 0 .785% $1 ,762 FHLB NOTE $1 ,199 ,868 $1 ,200,000 10/26/2017 0 .630% $1 ,886 FNMA NOTE $999,800 $1 ,000 ,000 10/26/201 7 0 .885% $2 ,207 FFCB NOTE $999 ,000 $1 ,000 ,000 11 /6/2017 0 .811 % $2 ,022 FHLB NOTE $750,750 $750 ,000 12/8/2017 1.072 % $2 ,005 FHLB NOTE $1 ,200,000 $1 ,200 ,000 12 /29/2017 1.010% $3 ,022 FFCB NOTE $1 ,000 ,580 $1 ,000 ,000 2/12 /2018 0.771 % $1 ,921 FHLMC NOTE $999 ,030 $1,000 ,000 3/7/2018 0 .925% $2 ,306 FHLMC NOTE $999,850 $1 ,000 ,000 4/9/20 18 0 .758 % $249 FNMA NOT E $1 ,003 ,700 $1 ,000 ,000 4/30/2018 0 .811 % $866 FFCB NOTE $997 .400 $1 ,000,000 5/16/2018 0 .882 % $1 ,208 FHLB NOTE $1 ,200,000 $1 ,200 ,000 6/5/2018 0 .850% $1 ,984 TOTAL INTEREST EARNED ON CITY INVESTMENTS HELD APRIL 1, 2016 THROUGH JUNE 30, 2016 $42 ,493 RECAP OF MARKET VALUES ON CITY OF COLLEYVILLE INVESTMENTS HELD APRIL 1 -JUNE 30, 2016 INVESTMENT PURCHASE MATURITY PURCHASE DATE DATE PRICE FHLB NOTE 6112/2 014 611012016 $1 ,198 ,200 FHLB NOTE 1012212014 1011712016 $1 ,000 ,590 FFCB NOTE 1111412014 51912016 $1 ,004 ,070 FHLB NOTE 11 124 12014 1112312016 $1 ,201 ,546 FHLB NOTE 1211812014 1211212016 $1 ,301 ,014 TREASURY NOTE 6115 12015 1211512016 $1 ,301 ,219 FHLB NOTE 611912015 611212017 $750 ,000 FHLB NOTE 612412015 417/2017 $1 ,003 ,800 FHLB NOTE 71612 015 613012017 $1 ,000 ,390 FFCB NOTE 711512015 611612017 $1 ,001 ,230 FFCB NOTE 911612015 911412017 $1 ,000 ,000 FFCB NOTE 1011912015 81281201 7 $1 ,003 ,690 FHLB NOTE 1011912015 1012612017 $1 ,1 99 ,868 FHLMC NOTE 1012212015 712812017 $1 ,004 ,385 FFCB NOTE 111412015 11 12212016 $1 ,015 ,700 FFCB NOTE 11 1412015 1011312017 $897 ,660 FFCB NOTE 11112/2015 11 161201 7 $999 ,000 FNMA NOTE 1111312 0 15 1012612017 $999 ,800 FHLB NOTE 12/2912015 1212912017 $1 ,2 00 ,000 FHLB NOTE 11512016 121812017 $750 ,750 FFCB NOTE 211712 016 211212018 $1 ,000 ,580 FHLMC NOTE 312312016 317/2018 $999 ,030 FHLMC NOTE 411212016 41912018 $999 ,850 FNMA NOTE 51912016 4130 12 018 $1 ,003 ,700 FFCB NOTE 512012016 511612 018 $99 7,4 00 FHLB NOTE 611012016 61512 018 $1 ,200 ,000 TOTALS PAR VALUE $1 ,200 ,000 $1 ,000 ,000 $1 ,000 ,000 $1 ,200 ,000 $1 ,300 ,000 $1 ,300 ,000 $750 ,000 $1 ,000 ,000 $1 ,000 ,000 $1 ,000 ,000 $1 ,000 ,000 $1 ,000 ,000 $1 ,200 ,000 $1 ,000 ,000 $1 ,000 ,000 $900 ,000 $1 ,000 ,000 $1,000 ,000 $1 ,2 00 ,000 $750 ,000 $1 ,000 ,000 $1 ,000 ,000 $1 ,000 ,000 $1 ,000 ,000 $1 ,000 ,000 $1 ,200 ,000 MARKET VALUE @3-31-16 $1 ,199 ,952 $1 ,000 ,249 $1 ,000 ,531 $1 ,200 ,564 $1 ,301 ,846 $1 ,300 ,660 $751 ,586 $1 ,001 ,818 $1 ,001 ,554 $1 ,000 ,657 $1 ,001 ,606 $1 ,001 ,358 $1 , 19 7,646 $1 ,002 , 188 $1 ,007 ,900 $898 ,023 $999 ,568 $1 ,001 ,884 $1 ,202 ,483 $754 ,274 $999 ,719 $1 ,001,494 $0 $0 $0 $0 LESS MATURITY PROCEEDS $1 ,200 ,000 NIA $1 ,000 ,000 NIA NIA NIA NIA NIA NIA NIA NIA NIA NIA NIA NIA NIA NIA NIA NIA NIA NIA NIA NIA NIA NIA NIA $22 ,827 ,559 $2 ,200 ,000 PLUS PERIOD PURCHASES NIA NIA NIA NIA NIA NIA NIA NIA NIA NIA NIA NIA NIA NIA NIA NIA NIA NIA NIA NIA NIA NIA $999 ,850 $1 ,003 ,7 00 $997,400 $1 ,200,000 $4 ,200 ,950 MARKET VALUE @6-30-16 $0 $1 ,000 ,338 $0 $1 ,200 ,644 $1 ,301,494 $1 ,301 ,331 $751 ,913 $1 ,003,460 $1 ,001 ,888 $1 ,001 ,651 $1 ,001 ,915 $1 ,001,408 $1 ,200,427 $1 ,003 ,647 $1 ,005 ,534 $900 ,653 $1 ,001 ,7 86 $1 ,003 ,482 $1,202 ,699 $755 , 134 $1 ,002 ,069 $1 ,001 ,843 $1 ,001 ,152 $1 ,005 ,7 37 $1 ,001 , 182 $1 ,203 ,574 $24 ,854 ,961 LISTING OF INVESTMENTS BY GENERAL LEDGER ACCOUNT NUMBER OUTSTANDING INVESTMENTS AT 6-30-16 INVESTMENT DATE ACQUIRED MATURITY DATE 26 WEEK T-BILL AUCTION DISCOUNT/WEEK OF PURCHASE YI ELD TO MATURITY CUSIP# ACCOUNT ALLOCATION OF INVESTMENT 001 -1172 GENERAL FUND OPERATING 002-1166 UTILITY DEBT SERVICE RESERVE 002-1172 UTILITY FUND OPERATING 002 -1178 CUSTOMER DEPOSITS 002 -1186 UTILITY LINE RENEWAL 002 -1557 THE RESERVE LIFT STATION 003-1180 BEDFORD BRIDGE ESCROW 003-1188 TOWN CENTER/HWY26 003-1192 MCDONWELL WOODS EST ESCROW 003-1200 LONGWOOD-PARKING ESCROW 003-1204 BEDFORD LAKES/SOMERSET 003-1231 LAKEWOOD ESCROW 003-1236 E. GLADE CRANBROOK ESCROW 003-1247 GLADE/WAYSIDE ESCROW 003-1250 REATIAPLACE 003-1301 LAKEWOOD PH IV 003-1304 VILLAS DEL MAR 003-1307 STREET RECONSTRUCTION 003-1309 COVENANT CHRISTIAN 003-1319 REMINGTON PARK 003-1323 SHALIMAR 003-1325 PECAN GARDENS 003-1330 REMINGTON PARK 003-1340 CASTLETON MANOR 003-1357 CITGO/LO LOCKETI 003-1392 CLAIRMONT-PH I 003-1404 TANGLEWOOD 003-1418 CLAIRMONT-PH II 003-1429 WARWICK PARC 003-1 434 ROCKRIMMON 003-1486 CHANEL'S COURT 003-1563 VILLAS OF COLLEYVILLE 005-1172 VOLUNTARY PARK FUND 011-1172 LIBRARY DONATIONS FUND 012 -1172 PARK LAND DEDICATION FUND 017-1172 DRAINAGE FUND OPERATING 02 4-1 172 CEDC OPERATING 026-1172 TIF OPERATING 032 -1519 CAPITAL EQUIPMENT RESERVE 034-1172 COLLEYVILLE TOMORROW PER GENERAL LEDGER MARKET VALUE VALUE AT MATURITY INTEREST RECEIVED TO MATURITY INVESTMENT- G/L TOTAL $7,013 ,963 .06 $643 ,699 .78 $3 ,915 ,454 .05 $443 ,236 .29 $2 ,492 ,826 .00 $62 ,103 .77 $35 ,907 .83 $36 ,326 .67 $10 ,996 .31 $13 ,380.01 $227 ,978 .36 $26 ,103.65 $117 ,794 .09 $42,420 .01 $98,462 .36 $77 ,530 .57 $60 ,324 .37 $247 ,753 .20 $140,343 .10 $27 ,855 .96 $69 ,691 .33 $32 ,389 .09 $81 ,068 .37 $81 ,309 .57 $56 ,809 .28 $104 ,974 .96 $26 , 111 .30 $147 ,050 .32 $89 , 131 .60 $65 ,055 .06 $47 ,895 .39 $52 ,979.48 $849 ,801 .56 $359 ,642 .52 $2 ,114 ,816 .14 $219,440 .95 $499 , 750 .00 $3,873 , 133 .23 $450,000 .00 $375 ,441 .76 $25 ,330 ,951 .35 $25 ,355,449.80 $25 ,300 ,000 .00 $356,390 . 75 OUTSTANDING INVESTMENTS AT 6-30-16 INVESTMENT FHLB NOTE FHLB NOTE FHLB NOTE TREASURY FHLB NOTE DATE ACQUIRED 22 -0ct-14 24-Nov-14 18-Dec-14 15-Jun-15 19-Jun-15 MATURITY DATE 17 -0ct-16 23-Nov-16 12-Dec-16 15-Dec-16 12-Jun-17 26 WEEK T-BILL AUCTION DISCOUNT/WEEK OF PURCHASE 0 .060% 0 .080 % 0 .120% 0 .110% 0 .050 % YIELD TO MATURITY 0.470% 0 .560% 0 .660 % 0.562% 0 .820% CUS IP# 3130A3CW2 3130A3J70 3130A3Q64 912828A59 3130A5PC7 001-1172 GENERAL FUND OPERATING 0.00 1,060 .29 002-1166 UTILITY DEBT SERVICE RESERVE 002 -1172 UTILITY FUND OPERATING 449,796 .28 0 .00 190 ,762 .23 002-1178 CUSTOMER DEPOSITS 002 -1186 UTILITY LINE RENEWAL 1,301 ,014 .00 37 ,511 .00 002-1557 THE RESERVE LIFT STATION 003-1180 BEDFORD BRIDGE ESCROW 35 ,907 .83 003-1188 TOWN CENTER/HWY26 003-1192 MCDONWELL WOODS EST ESCROW 003-1200 LONGWOOD-PARKING ESCROW 003-1204 BEDFORD LAKES/SOMERSET 003-1231 LAKEWOOD ESCROW 003-1236 E . GLADE CRANBROOK ESCROW 003-1247 GLADE/WAYSIDE ESCROW 003-1250 REATIAPLACE 003-1301 LAKEWOOD PH IV 003-1304 VILLAS DEL MAR 003-1307 STREET RECONSTRUCTION 003-1309 COVENANT CHRISTIAN 140,343 .10 003-1319 REMINGTON PARK 003-1323 SHALIMAR 003-1325 PECAN GARDENS 32 ,389 .09 003-1330 REMINGTON PARK 81 ,068 .37 003-1340 CASTLETON MANOR 003-1357 CITGO/LD LOCKETI 003-1392 CLAIRMONT-PH I 003-1404 TANGLEWOOD 003-1418 CLAIRMONT-PH II 003-1429 WARWICK PARC 89 ,131 .60 003-1434 ROCKRIMMON 65 ,055 .06 003-1486 CHANEL'S COURT 003-1563 VILLAS OF COLLEYVILLE 005-1172 VOLUNTARY PARK FUND 200 ,374 .33 199,427.23 011 -1172 LIBRARY DONATIONS FUND 359 ,642 .52 012-1172 PARK LAND DEDICATION FUND 115 ,983 .26 100,187 .16 461,448 .71 227 ,197 .01 01 7-1172 DRAINAGE FUND OPERA TING 69,440 .95 024 -1172 CEDC OPERATING 026 -1172 TIF OPERATING 499 ,872.46 450 ,127 .54 421 ,536 .57 032-1519 CAPITAL EQUIPMENT RESERVE 034-1172 COLLEYVILLE TOMORROW 25 ,091 .76 PER GENERAL LEDGER $1 ,000 ,590 .00 $1 ,201 ,545 .60 $1 ,301,014 .00 $1 ,301 ,218 .75 $750 ,000 .00 MARKET VALUE $1 ,000 ,338 .00 $1 ,200 ,644.40 $1 ,301,493 .70 $1 ,301 ,331 .20 $751 ,913 .25 VALUE AT MATURITY $1 ,000 ,000 .00 $1 ,200 ,000 .00 $1 ,300 ,000 .00 $1 ,300 ,000 .00 $750 ,000 .00 INTEREST RECEIVED TO MATURITY $9 ,350 .80 $13,441 .03 $17 ,051 .37 $10 ,991 .92 $12 ,198.67 OUTSTANDING INVESTMENTS AT 6-30-16 INVESTMENT FHLB NOTE FHLB NOTE FFCB NOTE TREASURY NOTE FFCB NOTE FHLB DATE ACQUIRED 24-Jun-15 06-Jul-15 15-Jul-15 31-Jul-15 16-Sep-15 19-0ct-15 MATURITY DATE 07-Apr-17 30-Jun-17 16-Jun-17 31-Ju~17 14-Sep-17 26-0ct-17 26 WEEK T-BILL AUCTION DISCOUNT/WEEK OF PURCHASE 0 .080 % 0 .080 % 0.110% 0 .140% 0 .240% 0.120% YIELD TO MATURITY 0.735 % 0 .710% 0.735% 0 .650% 0 .780% 0.630% CUSIP# 313379XBO 3130A5HF9 3133EEX62 912828XPO 3133EFCY1 3130A6LZ8 001-1172 GENERAL FUND OPERATING 848 ,240 .00 1,000 ,000 .00 0.00 002 -1166 UTILITY DEBT SERVICE RESERVE 002-1172 UTILITY FUND OPERATING 850 ,729 .00 499 ,868 .00 002-1178 CUSTOMER DEPOSITS 002-1186 UTILITY LINE RENEWAL 1,003 ,800 .00 150,501 .00 002-1557 THE RESERVE LIFT STATION 003-1180 BEDFORD BRIDGE ESCROW 003-1188 TOWN CENTER/HWY26 003-1192 MCDONWELL WOODS EST ESCROW 003-1200 LONGWOOD-PARKING ESCROW 003-1204 BEDFORD LAKES/SOMERSET 003-1231 LAKEWOOD ESCROW 003-1236 E . GLADE CRANBROOK ESCROW 003-1247 GLADE/WAYSIDE ESCROW 003-1250 REAITAPLACE 003-1301 LAKEWOOD PH IV 003-1304 VILLAS DEL MAR 003-1307 STREET RECONSTRUCTION 003-1309 COVENANT CHRISTIAN 003-1319 REMINGTON PARK 003-1323 SHALIMAR 003-1325 PECAN GARDENS 003-1330 REMINGTON PARK 003-1340 CASTLETON MANOR 003-1357 CITGO/LO LOCKEIT 003-1392 CLAIRMONT-PH I 003-1404 TANGLEWOOD 003-1418 CLAIRMONT-PH II 003-1429 WARWICK PARC 003-1434 ROCKRIMMON 003-1486 CHANEL'S COURT 003-1563 VILLAS OF COLLEYVILLE 005-1172 VOLUNTARY PARK FUND 011-1172 LIBRARY DONATIONS FUND 012-1172 PARK LAND DEDICATION FUND 017-1172 DRAINAGE FUND OPERATING 024-1172 CEDC OPERATING 499 ,750 .00 026-1172 TIF OPERATING 152 ,150.00 700 ,000 .00 032 -1519 CAPITAL EQUIPMENT RESERVE 034-1172 COLLEYVILLE TOMORROW PER GENERAL LEDGER $1 ,003 ,800 .00 $1 ,000 ,390 .00 $1 ,001 ,230 .00 $499 ,750.00 $1 ,000 ,000.00 $1 , 199,868 .00 MARKET VALUE $1 ,003 ,460 .00 $1 ,001 ,888 .00 $1 ,001 ,651 .00 $500,488 .50 $1 ,001 ,915 .00 $1 ,200,427 .20 VALUE AT MATURITY $1 ,000 ,000 .00 $1 ,000 ,000 .00 $1 ,000 ,000 .00 $500,000 .00 $1 ,000,000 .00 $1 ,200 ,000 .00 INTEREST RECEIVED TO MATURITY $13 ,155.46 $14 ,105 .76 $14 ,141 .86 $6 ,510 .95 $15 ,578 .55 $15 ,297 .81 OUTSTANDING INVESTMENTS AT 6-30-16 INVESTMENT FFCB NOTE FHLMC FFCB NOTE FFCB NOTE FFCB NOTE DATE ACQUIRED 19-0ct-15 22-0ct-15 04-Nov-15 04-Nov-15 12-Nov-15 MATURITY DATE 28-Aug-17 28-Jul-17 22-Nov-16 13-0ct-17 06-Nov-17 26 WEEK T-BILL AUCTION DISCOUNT/WEEK OF PURCHASE 0 .120% 0.110% 0 .270 % 0 .270% 0.340 % YIELD TO MATURITY 0 .580% 0.600 % 0 .375 % 0 .785% 0.811 % CUSIP# 3133EFEU7 3134G6AC7 31331J2M4 3133EFHY6 3133EFNE3 001-1172 GENERAL FUND OPERATING 513 ,360 .00 002-1166 UTILITY DEBT SERVICE RESERVE 002-1172 UTILITY FUND OPERATING 6 ,363 .67 1,004 ,385 .00 280 ,000 .00 20 ,000 .00 198 ,690 .95 002 -1178 CUSTOMER DEPOSITS 165 ,687 .76 002-1186 UTILITY LINE RENEWAL 002-1557 THE RESERVE LIFT STATION 62 ,103 .77 003-1180 BEDFORD BRIDGE ESCROW 003-1188 TOWN CENTER/HWY26 36 ,326 .67 003-1192 MCDONWELL WOODS EST ESCROW 10 ,996 .31 003-1200 LONGWOOD-PARKING ESCROW 13 ,380 .01 003-1204 BEDFORD LAKES/SOMERSET 227 ,978 .36 003-1231 LAKEWOOD ESCROW 26 ,103 .65 003-1236 E . GLADE CRANBROOK ESCROW 117 ,794 .09 003-1247 GLADE/WAYSIDE ESCROW 42,420 .01 003-1250 REATIA PLACE 98,462 .36 003-1301 LAKEWOOD PH IV 77,530 .57 003-1304 VILLAS DEL MAR 60 ,324 .37 003 -1307 STREET RECONSTRUCTION 43 ,849 .86 003-1309 COVENANT CHRISTIAN 003 -1319 REMINGTON PARK 27 ,855 .96 003-1323 SHALIMAR 69 ,691 .33 003-1325 PECAN GARDENS 003-1330 REMINGTON PARK 003-1340 CASTLETON MANOR 81 ,309 .57 003-1357 CITGO/LO LOCKETI 56 ,809 .28 003-1392 CLAIRMONT-PH I 104 ,974 .96 003-1404 TANGLEWOOD 26 ,111 .30 003-1418 CLAIRMONT-PH II 147 ,050 .32 003-1429 WARWICK PARC 003-1434 ROCKRIMMON 003-1486 CHANEL'S COURT 47 ,895 .39 003-1563 VILLAS OF COLLEYVILLE 52 ,979.48 005-1172 VOLUNTARY PARK FUND 200 ,000.00 011 -1172 LIBRARY DONATIONS FUND 012-1172 PARK LAND DEDICATION FUND 300 ,000.00 200 ,000 .00 017-1172 DRAINAGE FUND OPERA TING 150,000 .00 024-1172 CEDC OPERATING 026-1172 TIF OPERATING 032 -1519 CAPITAL EQUIPMENT RESERVE 85 ,700 .00 364 ,300 .00 034-1172 COLLEYVILLE TOMORROW PER GENERAL LEDGER $1 ,003 ,690 .00 $1 ,004 ,385 .00 $1 ,015,700.00 $897 ,660 .00 $999 ,000 .00 MARKET VALUE $1 ,001.408.00 $1 ,003 ,647 .00 $1 ,005 ,534 .00 $900 ,653.40 $1,001,786 .00 VALUE AT MATURITY $1 ,000 ,000 00 $1 ,000 ,000 .00 $1 ,000,000 .00 $900 ,000 .00 $1 ,000 ,000 .00 INTEREST RECEIVED TO MATURITY $10 ,791 .19 $10 ,602 .95 $3 ,948 .73 $13 ,726 .27 $16 ,107 .24 OUTSTANDING INVESTMENTS AT 6-30-16 IN VESTMENT FNMA NOTE FHLB NOTE FHLB NOTE FFCB NOTE FHLB NOTE DATE ACQUIRED 13-Nov-15 29-Dec-15 05-Jan-16 17 -Feb-16 23-Mar-16 MATURITY DATE 26-0ct-17 29-Dec-17 08-Dec-17 12-Feb-18 07-Mar-18 26 WEEK T-BILL AUCTION DISCOUNT/WEEK OF PURCHASE 0 .300% 0 .490% 0.100% 0 .420% 0.450% YIELD TO MATURITY 0 .885 % 1.010% 1 .072 % 0 .771 % 0.925% CUSIP# 3135GOPQO 3130A6UK1 3130A3HF4 3133EFZR1 3137EAOP1 001 -1172 GENERAL FUND OPERATING 999 ,800 .00 349 ,078 .61 265 ,564 .16 1,000 ,580 .00 39 ,030 .00 002-1166 UTILITY DEBT SERVICE RESERVE 643 ,699 .78 002-1 172 UTILITY FUND OPERATING 175 ,106.74 239,752 .18 002 -11 78 CUSTOMER DEPOSITS 32 ,114 .87 245,433 .66 002 -1186 UTILITY LINE RENEWAL 002 -1557 THE RESERVE LIFT STATION 003-1180 BEDFORD BRIDGE ESCROW 003-1188 TOWN CENTER/HWY26 003-1192 MCDONWELL WOODS EST ESCROW 003-1200 LONGWOOD-PARKING ESCROW 003-1204 BEDFORD LAKES/SOMERSET 003-1231 LAKEWOOD ESCROW 003 -1236 E . GLADE CRANBROOK ESCROW 003-1247 GLADE/WAYSIDE ESCROW 003 -1250 REATIAPLACE 003-1301 LAKEWOOD PH IV 003-1304 VILLAS DEL MAR 003-1307 STREET RECONSTRUCTION 003 -1309 COVENANT CHRISTIAN 003-1319 REMINGTON PARK 003-1323 SHALIMAR 003 -1325 PECAN GARDENS 003-1330 REMINGTON PARK 003 -1340 CASTLETON MANOR 003 -1357 CITGO/LO LOCKETI 003-1392 CLAIRMONT-PH I 003 -1404 TANGLEWOOD 003-1418 CLAIRMONT-PH II 003 -1 429 WARWICK PARC 003-1434 ROCKRIMMON 003-1486 CHANEL'S COURT 003 -1563 VILLAS OF COLLEYVILLE 005 -1172 VOLUNTARY PARK FUND 250,000 .00 011 -1172 LIBRARY DONATIONS FUND 012-1172 PARK LAND DEDICATION FUND 710 ,000 .00 017 -1172 DRAINAGE FUND OPERATING 024 -1172 CEDC OPERATING 026-11 72 TIF OPERATING 032 -1519 CAPITAL EQUIPMENT RESERVE 034-1172 COLLEYVILLE TOMORROW PER GENERAL LEDGER $999 ,800 .00 $1 ,200 ,000 .00 $750 ,750.00 $1 ,000,580 .00 $999 ,030 .00 MARKET VALUE $1 ,003,482 .00 $1 ,202 ,698 .80 $755,133 .75 $1 ,002,069 .00 $1 ,001 ,843 .00 VALUE AT MATURITY $1 ,000 ,000 .00 $1 ,200 ,000 .00 $750 ,000 .00 $1 ,000 ,000.00 $1,000 ,000 .00 INTEREST RECEIVED TO MATURITY $17 ,293 .88 $24 ,273 .21 $15,489.22 $15,325 .68 $18 ,096 .97 OUTSTANDING INVESTMENTS AT 6-30-16 INVESTMENT FHLMC NOTE FNMA NOTE FFCB NOTE FHLB NOTE DATE ACQUIRED 12-A pr-16 09-May-16 20-May-16 10-Jun-16 MATURITY DATE 09-Apr-18 30-Apr-18 16-May-18 05-Jun-18 26 WEEK T-BILL AUCTION DISCOUNT/WEEK OF PURCHASE 0 .520% 0.370 % 0.450% 0.410% YI ELD TO MATURITY 0 .758 % 0.81 1% 0 .882 % 0 .850 % CUSIP# 3137EAEA3 3136GOV57 3133EGAF2 3130A8EJ8 001-1172 GENERAL FUND OPERATING 999 ,850 .00 0.00 997,400.00 0 .00 002-1166 UTILITY DEBT SERVICE RESERVE 002-1172 UTILITY FUND OPERATING 002-1178 CUSTOMER DEPOSITS 002-1186 UTILITY LINE RENEWAL 002-1557 THE RESERVE LIFT STATION 003-1180 BEDFORD BRIDGE ESCROW 003-1188 TOWN CENTER/HWY26 003-1192 MCDONWELL WOODS EST ESCROW 003 -12 00 LONGWOOD-PARKING ESCROW 003-1204 BEDFORD LAKES/SOMERSET 003-1231 LAKEWOOD ESCROW 003-1236 E . GLADE CRANBROOK ESCROW 003-1247 GLADE/WAYSIDE ESCROW 003-1250 REATTA PLACE 003-1301 LAKEWOOD PH IV 003-1304 VILLAS DEL MAR 003-1307 STREET RECONSTRUCTION 203 ,903 .34 003-1309 COVENANT CHRISTIAN 003-1319 REMINGTON PARK 003-1323 SHALIMAR 00 3-132 5 PECAN GARDENS 003-1330 REMINGTON PARK 003-1340 CASTLETON MANOR 003 -13 57 CITGO /LO LOCKETT 003-1392 CLAIRMONT-PH I 003-1404 TANGLEWOOD 003-1418 CLAIRMONT-PH II 003-1429 WARWICK PARC 003-1434 ROCKRIMMON 003-1486 CHANEL'S COURT 003-1563 VILLAS OF COLLEYVILLE 005-1172 VOLUNTARY PARK FUND 011-1172 LIBRARY DONATIONS FUND 012-1172 PARK LAND DEDICATION FUND 017-1172 DRAINAGE FUND OPERATING 024-1172 CEDC OPERATING 026-1172 TIF OPERATING 799,7 96 .66 849 ,650 .00 032-15 19 CAPITAL EQUIPMENT RESERVE 034-1172 COLLEYVILLE TOMORROW 350 ,350 .00 PER GENERAL LEDGER $999 ,850 .00 $1 ,003 ,700 00 $997 ,400 .00 $1 ,200 ,000 .00 MARKET VA LUE $1 ,001 ,152 .00 $1 ,005 ,737 .00 $1 ,001 ,182 .00 $1 ,203 ,573 .60 VAL UE AT MATURITY $1 ,000 ,000 .00 $1 ,000 ,000 .00 $1 ,000 ,000 .00 $1 ,200 ,000 .00 IN TEREST RECE IV ED TO MATURITY $15 ,089 .51 $16 ,015 .09 $17 ,546.43 $20 ,260 .23 CDARS CERTIFICATE OF DEPOSI T ALLOCATION II CDARS CERTIFICATES OF DEPOSIT II INTEREST EARNED FUND PURCHASE MATURITY INTEREST DURING ALLOCATION AMOUNT DATE DATE RATE QUARTER UTILITY FUND $508 ,338 .65 7/30/2015 7/27/2017 0.40% $506 .95 GENERAL FUND $510 ,929.49 6/23/2016 6/21/2018 0.40% $128 .78 GENERAL FUND $508 ;285 .09 3/24/2016 3/23/2017 0.30% $380 .17 GENERAL FUND $1 ,518,932 .34 9/24/2015 9/22/2016 0.40% $1 ,511.82 GENERAL FUND $504 ,998.83 9/25/2014 9/22/2016 0.50% $629 .52 GENERAL FUND $504 ,752 .03 9/24/2015 9/21/2017 0.40% $503 .37 GENERAL FUND $504 ,998 .84 3/24/2016 3/22/2018 0 .50% $629 .52 TOTAL $4 ,561 ,235 .27 $4,290.12 LOGIC INVESTMENT POOL ALLOCATION AND GENERAL INFORMATION LOCAL GOVERNMENT INVESTMENT COOPERATIVE/ "LOGIC" ACCOUNT ALLOCATION AT JUNE 30, 2016 ACCT# DESCRIPTION BALANCE GENERAL FUND 001-1115 GENERAL OPERATING $1 ,116,711 .11 UTILITY FUND 002-1115 UTILITY OPNS $988 ,969 .64 002-1116 IMPACT FEES WATER $1 ,250 ,276 .13 002-1119 UTILITY LINE RESTORATION $1 ,368 ,309 .14 002-1130 UTILITY INTEREST & SINKING FUND $535 ,261 .04 002-1294 IMPACT FEES SEWER $366 ,720 .99 CAPITAL PROJECTS FUND 003-1113 IMPACT FEES/SA I $21 ,274 .08 003-1508 MICRO-RESURFACING $305 ,555 .27 003-1509 STREET RESURFACING $18 ,813 .69 DEBT SERVICE FUND 004-1115 DEBT SERVICE OPERATING $831 ,245 . 78 DRAINAGE FUND 017-1115 DRAINAGE OPERATING $699,759.47 017-1159 DRAINAGE INT & SINKING FUND $241 ,905 .23 017-1380 2001 DRAINAGE BONDS $2 ,334 .81 TIFFUND 026-1115 TIF OPERATING $11 ,505 ,879 .00 026-1383 2001 TIF BONDS $123 ,740 .15 CCCPDFUND 027-1115 CCCPD OPERATING $816 ,627 .38 027-1147 99 POLICE/COURT BLDG FUND $81 .11 SALES TAX INCENTIVE AGREEMENT FUND 031-1115 SALES TAX INCENTIVE AGREEMENT OPERATING $355 ,542 .61 CAPITAL EQUIPMENT REPLACEMENT FUND 032-1115 CAPITAL EQUIPMENT REPLACEMENT FUND $82 , 172 .32 COLLEYVILLE TOMORROW FUND 034-1115 COLLEYVILLE TOMORROW FUND $1 ,650 ,261 .55 PARKS TOMORROW FUND 035-1115 PARKS TOMORROW FUND $1,194 ,888 .79 STRATEGIC INITIATIVES FUND 036-1115 STRATEGIC INITIATIVES FUND $297 ' 123 .47 TOTAL LOGIC POOL BALANCE $23 , 773 ,452 . 72 Ne w s Pe r f o r m a n c e New Participants We would like to welcome the following entities who joined the LOGIC program in June: Greater Houston TIRZ 24 Harris County Redevelopment Authority Red Oak EDC Audit Conﬁ rmations Please provide this new address to your auditors for any audit conﬁ rmations they may send to LOGIC regarding your account. There are no changes to our phone numbers, fax number or website address. New Address: LOGIC Participant Services 1201 Elm Street, Suite 3500 Dallas, Texas 75270 LOGIC Newsletter June 2016 E c o n o m i c C o m m e n t a r y At the beginning of the quarter, oil prices stabilized, pressure on China receded and the Fed remained dovish on future rate hikes. Towards the end of the quarter, the U.K.’s vote to leave the EU was a surprise resulting in a spike in market volatility with risk assets selling off in favor of safe haven assets. Global stocks plunged, the British pound nosedived to its lowest levels against the U.S. dollar since 1985 and Treasuries rallied across the board. Within about a week, the market stabilized and regained some of its losses as equity markets ﬁ nished the quarter slightly positive. The oil market delivered a strong performance as prices continued to rise, brieﬂ y touching $50 a barrel. The yield on the two-year U.S. Treasury note ended the quarter at 0.58% which is 14 bps lower since the beginning of the quarter and 30 bps lower since May month end. Throughout the quarter, the market probability for additional Fed rate hikes increased. The April FOMC minutes surprised the markets with its hawkish tone driven by stronger than expected retail sales, housing and consumer price data and propelled expectations higher for a potential hike this summer. The momentum was cut short with the release of the weak May non-farm payroll numbers along with the concerns over the U.K. referendum and resulted in the Fed’s decision to keep rates on hold in June. The vote by the U.K. to leave the EU dealt the ﬁ nal blow in which the market ultimately priced out any chance of a Fed rate hike in 2016. Negative rates across the globe continued to draw investors to the U.S. markets in search of higher yields. The surprise Brexit vote created an enormous amount of uncertainty in its wake. In the short run, the extraordinary accommodation that is being provided by the central banks, in aggregate, is helping to stave off the next recession and provide a backdrop for the extended sub-trend recovery to continue. A recent pickup in growth in the U.S., ﬁ rming energy prices and the stabilization of Chinese economic and ﬁ nancial data has eased near-term risks but the probability of recession has increased from 5% to 25% and may grow as high as 40%. While one off events, such as Brexit, may continue to create market volatility, it is expected that these will be met with effective policy responses. Expectations are that a Fed rate hike is off the table at this point and that US dollar strengthening will tighten financial conditions. Further response is anticipated from central banks as they continue to be committed to doing whatever it takes to stimulate growth. This information is an excerpt from an economic report dated June 2016 provided to LOGIC by JPMorgan Asset Management, Inc., the investment manager of the LOGIC pool. *Definition of Weighted Average Maturity (1) & (2) (1) This weighted average maturity calculation uses the SEC Rule 2a-7 deﬁ nition for stated maturity for any ﬂ oating rate instrument held in the portfolio to determine the weighted average maturity for the pool. This Rule speciﬁ es that a variable rate instrument to be paid in 397 calendar days or less shall be deemed to have a maturity equal to the period remaining until the next readjustment of the interest rate. (2) This weighted average maturity calculation uses the ﬁ nal maturity of any ﬂ oating rate instruments held in the portfolio to calculate the weighted average maturity for the pool. Rates reﬂ ect historical information and are not an indication of future performance. As of June 30, 2016 Current Invested Balance $4,098,495,182.80 Weighted Average Maturity (1)* 33 Days Weighted Average Maturity (2)* 48 Days Net Asset Value 1.000156 Total Number of Participants 493 Management Fee on Invested Balance 0.0875% Interest Distributed $2,156,920.39 Management Fee Collected $289,041.69 % of Portfolio Invested Beyond 1 Year 0.98% Standard & Poor’s Current Rating AAAm June Averages: Average Invested Balance $4,030,084,351.83 Average Monthly Yield, on a simple basis 0.5640% Average Weighted Average Maturity (1)* 38 Days Average Weighted Average Maturity (2)* 54 Days Distribution of Participants by Type As of June 30, 2011 Portfolio by Maturity As of June 30, 2011 In f o r m a t i o n a t a G l a n c e Hi s t o r y Historical Program Information Average Book Market Net Number of Month Rate Value Value Asset Value WAM (1)* WAM (2)* Participants Jun 16 0.5640% $4,098,495,182.80 $4,099,137,783.02 1.000156 38 54 493 May 16 0.5496% 4,112,196,457.64 4,112,970,867.25 1.000188 41 61 490 Apr 16 0.5439% 4,225,726,061.33 4,226,329,499.91 1.000129 35 57 489 Mar 16 0.5206% 4,641,892,583.12 4,642,690,932.90 1.000171 38 59 488 Feb 16 0.4823% 4,916,962,940.50 4,917,463,027.96 1.000101 43 64 486 Jan 16 0.3922% 4,658,046,995.69 4,658,236,771.04 1.000040 41 59 486 Dec 15 0.2331% 3,937,397,581.06 3,937,328,740.05 0.999960 37 48 486 Nov 15 0.1637% 3,408,876,009.37 3,408,877,369.21 1.000000 41 55 485 Oct 15 0.1635% 3,299,010,020.32 3,299,149,338.22 1.000037 45 60 483 Sep 15 0.1354% 3,298,434,843.78 3,298,608,218.16 1.000052 37 48 482 Aug 15 0.1354% 3,481,714,713.30 3,481,787,250.61 1.000020 41 43 482 Jul 15 0.1265% 3,695,302,543.37 3,695,464,092.30 1.000035 45 47 482 As s e t s Book Value Market Value Uninvested Balance $ 1,902,842.35 $ 1,902,842.35 Accrual of Interest Income 327,930.94 327,930.94 Interest and Management Fees Payable (2,217,734.52) (2,217,734.52) Payable for Investment Purchased 0.00 0.00 Receivable for Investment Sold 0.00 0.00 Repurchase Agreements 522,705,999.89 522,705,999.89 Commercial Paper 3,515,783,301.63 3,516,452,544.36 Government Securities 59,992,842.51 59,966,200.00 Total $ 4,098,495,182.80 $ 4,099,137,783.02 Market value of collateral supporting the Repurchase Agreements is at least 102% of the Book Value. The portfolio is managed by J.P. Morgan Chase & Co. and the assets are safekept in a separate custodial account at the Federal Reserve Bank in the name of LOGIC. The only source of payment to the Participants are the assets of LOGIC. There is no secondary source of payment for the pool such as insurance or guarantee. Should you require a copy of the portfolio, please contact LOGIC Participant Services. Portfolio Asset Summary as of June 30, 2016 Commercial Paper 85.79% Repurchase Agreements 12.75% 8 to 30 days 32.76 1 to 7 days 26.16% 181+ days 0.73% 31 to 90 days 30.95%Utility District 10.55% Other 6.69% School District 38.74%Health Care 1.62% County 10.55% Higher Education 2.84% City 29.01% Distribution of Participants by Type As of June 30, 2016 Portfolio by Type of Investment As of June 30, 2016 Portfolio by Maturity As of June 30, 2016 91 to 180 days 9.40% Agencies 1.46% Mny Mkt Fund Daily Allocation LOGIC Invested Market Value WAM WAM Date Equiv. [SEC Std.] Factor Balance Per Share Days (1)* Days (2)* 6/1/2016 0.5519% 0.000015121 $4,117,383,368.24 1.000176 41 59 6/2/2016 0.5491% 0.000015043 $4,111,998,023.23 1.000173 40 58 6/3/2016 0.5559% 0.000015229 $4,063,781,851.22 1.000144 41 60 6/4/2016 0.5559% 0.000015229 $4,063,781,851.22 1.000144 41 60 6/5/2016 0.5559% 0.000015229 $4,063,781,851.22 1.000144 41 60 6/6/2016 0.5496% 0.000015057 $4,061,350,935.52 1.000175 40 58 6/7/2016 0.5520% 0.000015124 $4,044,252,858.89 1.000178 41 58 6/8/2016 0.5474% 0.000014997 $4,067,526,340.15 1.000184 41 57 6/9/2016 0.5498% 0.000015063 $4,039,641,325.19 1.000185 41 59 6/10/2016 0.5550% 0.000015206 $4,054,176,511.58 1.000157 41 57 6/11/2016 0.5550% 0.000015206 $4,054,176,511.58 1.000157 41 57 6/12/2016 0.5550% 0.000015206 $4,054,176,511.58 1.000157 41 57 6/13/2016 0.5524% 0.000015135 $4,090,054,318.54 1.000181 40 56 6/14/2016 0.5606% 0.000015359 $4,104,788,636.85 1.000175 40 55 6/15/2016 0.5732% 0.000015705 $3,938,636,982.67 1.000182 40 57 6/16/2016 0.5715% 0.000015658 $3,944,786,029.88 1.000190 40 56 6/17/2016 0.5730% 0.000015699 $3,930,251,559.77 1.000166 37 54 6/18/2016 0.5730% 0.000015699 $3,930,251,559.77 1.000166 37 54 6/19/2016 0.5730% 0.000015699 $3,930,251,559.77 1.000166 37 54 6/20/2016 0.5713% 0.000015651 $3,944,876,797.49 1.000192 36 52 6/21/2016 0.5671% 0.000015536 $3,996,870,149.94 1.000188 35 51 6/22/2016 0.5672% 0.000015541 $3,993,037,212.86 1.000184 34 50 6/23/2016 0.5681% 0.000015565 $3,994,224,770.58 1.000174 34 49 6/24/2016 0.5752% 0.000015758 $4,020,382,013.37 1.000147 32 47 6/25/2016 0.5752% 0.000015758 $4,020,382,013.37 1.000147 32 47 6/26/2016 0.5752% 0.000015758 $4,020,382,013.37 1.000147 32 47 6/27/2016 0.5789% 0.000015861 $3,979,041,207.89 1.000169 32 47 6/28/2016 0.5789% 0.000015861 $4,088,067,286.71 1.000160 34 48 6/29/2016 0.5770% 0.000015809 $4,081,723,319.61 1.000162 34 49 6/30/2016 0.5764% 0.000015791 $4,098,495,182.80 1.000156 33 48 Average 0.5640% 0.000015452 $4,030,084,351.83 38 54 Da i l y R a t e s Daily Summary for June 2016 LOGIC versus 90-Day Treasury Bill This material is for information purposes only. This information does not represent an offer to buy or sell a security. The above rate information is obtained from sources that are believed to be reliable; however, its accuracy or completeness June be subject to change. The LOGIC management fee may be waived in full or in part at the discretion of the LOGIC co-administrators and the LOGIC rate for the period shown reﬂ ects waiver of fees. This table represents historical investment performance/return to the customer, net of fees, and is not an indication of future performance. An investment in the security is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. Although the issuer seeks to preserve the value of an investment at $1.00 per share, it is possible to lose money by investing in the security. Information about these and other program details are in the fund’s Information Statement which should be read carefully before investing. The yield on the 90-Day Treasury Bill (“T-Bill Yield”) is shown for comparative purposes only. When comparing the investment returns of the LOGIC pool to the T-Bill Yield, you should know that the LOGIC pool consist of allocations of speciﬁ c diversiﬁ ed securities as detailed in the respective Information Statements. The T-Bill Yield is taken from Bloomberg Finance L.P. and represents the daily closing yield on the then current 90-day T-Bill. Da i l y R a t e s Da i l y S u m m a r y 0.02 0.08 0.14 0.20 0.26 0.32 0.38 0.44 0.50 0.56 0.62 90 Day T-BILL Rate LOGIC Rate Co n t a c t s For more information contact LOGIC Participant Services  1-800-895-6442  www.logic.org LO G I C B o a r d LOGIC Board Members Philip G. Roberson Arlington ISD Board President Fred L. Werner Municipal Finance Director Board Vice President Judd R. Sanderson North Texas Municipal Water District Board Treasurer / Investment Ofﬁ cer Sandra Newby Tarrant Regional Water District Board Member Greg Jordan City of Grapevine Board Member L O G I C P a r t i c i p a n t S e r v i c e s F i r s t S o u t h w e s t , A D i v i s i o n o f H i l l t o p S e c u r i t i e s 1 2 0 1 E l m S t r e e t , S u i t e 3 5 0 0 D a l l a s , T X 7 5 2 7 0 The Dallas–Fort Worth economy continued to expand in May. Year to date through May, DFW employment grew an annualized 2.7 percent, twice as fast as the nation’s 1.3 percent rate. DFW home prices continued to climb in the first quarter, and sales were up in April. New-home construction was solid, and multifamily construction, although elevated, appears to be slowing. Unemployment remained near multiyear lows, suggesting continued tightness in the labor market. The Dallas Fed business- cycle indexes indicate continued growth for the metroplex. Summary � DFW payroll employment grew at an annualized 3.1 percent pace in May, an addition of 8,800 jobs. Job gains were robust in Dallas at an annual 4.1 percent but sluggish in Fort Worth at 0.6 percent. Year to date, job growth in Dallas has outperformed Fort Worth, which is witnessing slow job gains likely due to its higher dependence on the energy and manufacturing sectors. � The top three contributors to year-to-date growth remain the financial services, education and health services, and trade, transportation and utilities sec- tors, which added a combined 28,400 jobs. Losses in construction and mining continued, and year-to- date payrolls in the sector are down an annualized 4.7 percent (4,000 jobs). � In May, the unemployment rate fell to 3.5 percent in Dallas and held steady at 3.8 percent in Fort Worth and 4.4 percent in Texas. All three figures remain lower than the U.S. rate, which fell to 4.7 per- cent. Unemployment in both Dallas and Fort Worth is at multiyear lows. FEDERAL RESERVE BANK OF DALLAS • JUNE 21, 2016 Month/month percent change, annualized Employment SOURCES: Bureau of Labor Statistics; Texas Workforce Commission; seasonal and other adjustments by the Dallas Fed. NOTES: Data show seasonally adjusted and annualized percentage growth by industry supersector for December 2015–May 2016. Numbers in parentheses represent shares of total Dallas–Fort Worth nonfarm employment and may not sum to 100 due to rounding. SOURCES: Bureau of Labor Statistics; Texas Workforce Commission; seasonal and other adjustments by the Dallas Fed. Employment Growth by Sector Employment Growth DFW Economic Indicators DALLASFED Index, January 2009 = 100* *Monthly, seasonally adjusted. SOURCE: Dallas Fed. -4 -2 0 2 4 6 8 2010 2011 2012 2013 2014 2015 2016 Dallas–Fort Worth Texas � Overall economic growth was robust in Dallas but slowed in Fort Worth, according to the Dallas Fed’s metro business-cycle indexes. The Dallas index rose an annualized 6.6 percent in May follow- ing a 6.6 percent increase in April. The Fort Worth index climbed 2.3 percent in May after posting a 4.6 percent increase in April. Year over year, the Dallas index was up 6.4 percent, while the Fort Worth index was 3.0 percent higher as a result of continued job creation and low unemployment. Business-Cycle Indexes 90 100 110 120 130 140 150 2009 2010 2011 2012 2013 2014 2015 2016 Dallas Fort Worth 0.7 -0.6 -4.7 1.9 6.4 1.0 3.4 4.6 2.2 4.3 2.6 2.7 Information (2.3%) Other services (3.4%) Construction & mining (5.7%) Manufacturing (7.5%) Financial activities (8.2%) Leisure & hospitality (10.3%) Government (12.0%) Education & health services (12.3%) Professional & business services (16.6%) Trade, transportation & utilities (21.7%) Private (88%) Total NOTE: Data may not match previously published numbers due to revisions. Questions can be addressed to Laila Assanie at laila.assanie@dal.frb.org. More Dallas Fed economic updates: www.dallasfed.org/research/update/ Percent �The DFW housing market remains healthy, and home prices continue to trend upward. Home prices rose 3.1 percent in Dallas and 1.1 percent in Fort Worth in the first quarter, according to the Federal Housing Finance Agency purchase-only house price index. On a year-over-year basis, prices were up 11.0 percent in Dallas and 7.3 percent in Fort Worth—both higher than in Texas (7.1 percent) and the nation (5.7 percent). U.S. home prices have finally surpassed the highs seen during the housing boom, while prices in the metroplex are well above their prehousing bust peak, in part due to low inven- tories and continued strong demand. Home price appreciation will likely moderate this year. �In April, existing-home inventories were at 2.2 months of supply in Dallas and 2.3 months in Fort Worth. Inventories in both metros have consistently been below the six-month level since early 2012, which indicates a balanced housing market. �Existing-home sales climbed 2.7 percent in Dallas and 6.4 percent in Fort Worth in April. Year-over- year sales in April were up 11.5 percent in Dallas and 16.9 percent in Fort Worth, far outpacing the 8.0 percent increase for Texas. Even new-home sales remain healthy in the metroplex and are strongest for low- to mid-priced homes, according to Dallas Fed business contacts. Continued solid job growth is buoying DFW housing demand. �Rapidly rising home prices have reduced afford- ability in the metroplex. The National Association of Home Builders/Wells Fargo Housing Opportu- nity Index (HOI) for Dallas was 55.9 in first quarter 2016, suggesting that about 56 percent of the homes sold during the quarter were affordable to median- income families. The HOI for Fort Worth came in at 70.8 during the same period. Affordability in Dallas is lower than the U.S., where 65 percent of homes sold during the quarter were affordable to median- income families. �Apartment building in North Texas remains el- evated in the first quarter, with just over 43,000 units under construction, according to MPF Research. However, we have seen a pullback in permits issued—a forward-looking indicator, with total multifamily permits down 9.3 percent through April compared with the same period last year. �DFW has overtaken Houston as the top U.S. market in terms of annual new-home starts as of first quarter 2016, according to Metrostudy. DFW had 28,878 annual starts ending in the first quarter, a year-over-year increase of more than 5,300 starts. Although starts are up, single-family permitting appears to have slowed slightly, with total single- family permits down 2 percent through April versus the same period last year. Index, January 2009 = 100* *Five-month moving average; seasonally adjusted. SOURCE: Census Bureau. SOURCE: National Association of Home Builders/Wells Fargo Housing Opportunity Indexes. Index, first quarter 1991 = 100* Housing *Quarterly, seasonally adjusted. SOURCE: Federal Housing Finance Agency. 100 120 140 160 180 200 220 240 260 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 Dallas U.S. Fort Worth 20 30 40 50 60 70 80 90 100 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 Fort Worth U.S. Dallas 0 50 100 150 200 250 300 350 400 2009 2010 2011 2012 2013 2014 2015 2016 Multifamily permits Single-family permits Residential Construction Home Prices Home Affordability 2015 PFIA Legislative Changes Two Legislative bills were passed that will impact the Texas Public Funds Investment Act 2256 effective September 1, 2015: HB 870 Reduces the amount of Public Funds Investment Act (Chapter 2256.008, Texas Government Code) training hours for city and school district finance and investment officers from ten hours every two years to eight hours every two years. City and school district finance and investment officers must still initially receive ten hours of training within 12 months after taking office or assuming investment duties. Effective September 1, 2015. HB 1148 Provides that a city finance or investment officer must take only the initial 10 hour training under the Public Funds Investment Act (Chapter 2256.008, Texas Government Code) but no continuing investment training if the city: (1) does not invest city funds; or (2) only deposits city funds in interest‐bearing deposit accounts or certificates of deposit. Effective September 1, 2015. Since the phrase “does not invest city funds” is not defined in the bill, any city finance or investment officer desiring to forgo investment training under this bill may want to provide a definition of this phrase in the city’s approved investment policy, which is still a requirement under the Public Funds Investment Act. Additionally, it is recommended that any city finance or investment officer desiring to forgo investment training under this bill may want to confirm the applicability of the training hour changes with their local attorney/auditor.