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Home My WebLink AboutAudit Committee-Agenda Packets-08/20/2019City of Colleyville Page 1 City of Colleyville Audit Committee Agenda City Hall 100 Main Street Colleyville, Texas 76034 817.503.1000 www.colleyville.com Tuesday, August 20, 2019 5:00 p.m. City Manager’s Conference Room Third Floor – City Hall 1.CALL TO ORDER 2. APPROVAL OF MINUTES March 5, 2019 May 14, 2019 3.REGULAR AGENDA ITEMS 3a Discuss the Fiscal Year September 30, 2019, audit which will be conducted by the City's audit firm Weaver and Tidwell 3b Presentation of the Quarterly Investment Report for the quarter ended June 30, 2019 4.ADJOURNMENT I hereby certify this agenda was posted on City Hall bulletin boards Friday, August 16, 2019, by 5:00 p.m. Christine Loven, 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. 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 City Hall 100 Main Street Colleyville, Texas 76034 817.503.1000 www.colleyville.com Tuesday, March 5, 2019 4:30 p.m. City Manager’s Conference Room Third Floor – City Hall 1.CALL TO ORDER Chief Financial Officer Shereen Gendy called the Audit Committee to order on March 5, 2019 at 4:31 p.m. ROLL CALL: Committee members present George Dodson, Kathy Wheat, Bobby Lindamood Committee member Susan Mathisen arrived at 5:10 p.m. Also Present: Chief Financial Officer Shereen Gendy, Accounting Manager Karen Hines City Manager Jerry Ducay, Assistant City Manager Mark Wood, and City Secretary Christine Loven 2.APPROVAL OF MINUTES December 4, 2018 Committee member Wheat motioned to approve the minutes, Committee member Dodson seconded, the minutes were unanimously approved. 3.REGULAR AGENDA ITEMS 3a Discussion of the draft Fiscal Year 2018 (FY18) Audit and SAS 114 Letter Chief Financial Offer Shereen Gendy thanked Karen Hines and Jennifer Ripka for working with staff to finalize the audit, stating this was the first year to work with Weaver and Tidwell and there were changes in both staffs and delays in communications from the auditor, and changes to GASB 75. She then introduced Jennifer Ripka, Weaver and Tidwell who reviewed the draft audit and SAS 114. Ms. Ripka began by thanking staff and the committee and reported there are no significant deficiencies. Her presentation highlighted GASB 75 and 87, noted current and upcoming reporting changes, reviewed each of the funds, leases, pension assets, and the debt schedule. There were no questions from the committee who thanked staff and Ms. Ripka for their diligence and good work. City of Colleyville Page 2 Audit Committee Minutes March 5, 2019 3b Quarterly Investment Report for the quarter ended December 31, 2018 Chief Financial Officer Shereen Gendy reviewed the investment report, highlighting the funds in investment pools and the increase in interest revenue yielded from the sweep accounts. There was discussion of the City’s accounts and yields: CDARS, Sweeps, CDs, Pools, and Treasuries. City Manager Jerry Ducay stated the City is looking for options to diversify and receive higher yields. 4.ADJOURNMENT The meeting was adjourned at 5:18 p.m. PASSED BY A VOTE OF _ AYES, _ NAYS, THIS 20TH DAY OF AUGUST, 2019. Minutes taken and prepared by: Christine Loven, TRMC City Secretary City of Colleyville Page 1 City of Colleyville Audit Committee Minutes City Hall 100 Main Street Colleyville, Texas 76034 817.503.1000 www.colleyville.com Tuesday, May 14, 2019 4:00 p.m. City Manager’s Conference Room Third Floor – City Hall 1.CALL TO ORDER Chief Financial Officer Shereen Gendy called the Audit Committee to order on March 5, 2019 at 4:03 p.m. ROLL CALL: Committee members present George Dodson, Kathy Wheat, Bobby Lindamood Absent: Susan Mathisen Also Present: Chief Financial Officer Shereen Gendy, Accounting Manager Karen Hines City Manager Jerry Ducay, Assistant City Manager Mark Wood, and City Secretary Christine Loven 2.REPORTS Quarterly Investment Report for the quarter ended March 31, 2019 Chief Financial Officer Shereen Gendy reviewed the Investment Report, highlighting the continual increase in interest revenue from the Sweep Accounts and the diversity of the portfolio. Committee members stated they were pleased with the report and the quality of reports which are being provided by the Finance department, and thanked staff for all their efforts. 3.ADJOURNMENT The meeting was adjourned at 4:18 p.m. PASSED BY A VOTE OF _ AYES, _ NAYS, THIS 20TH DAY OF AUGUST, 2019. Minutes taken and prepared by: Christine Loven, 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 8/20/2019 Number 3a Type Regular Agenda Items Department City Manager Title Discuss the Fiscal Year September 30, 2019, audit which will be conducted by the City's audit firm Weaver and Tidwell Strategic Plan 1.4 Communicate thoroughly and strategically 2.4 Demonstrate stewardship of public resources Explanation Discuss the Fiscal Year September 30, 2019 audit which will be conducted by the City's audit firm Weaver and Tidwell 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 8/20/2019 Number Type Presentation Department Finance Title Presentation of the Quarterly Investment Report for the quarter ended June 30, 2019 Explanation Investment Summary for period ending June 30, 2019: Cash & Cash Equivalents (Local Government Investment Pools) were $79,744,334. The total funds held by the City of Colleyville equaled $94,642,175 and were allocated as follows: Current as of 6/30/2019 Last Quarter as of 3/31/2019 Cash $7,640,201.64 $5,209,518.86 Sweep 15,175,903.36 15,478,377.10 Commercial Paper Investment Pool 2,450,039.40 2,434,595.00 Government Only Investment Pool 54,478,189.52 54,152,102.00 Government Issuances 11,582,619.46 12,582,619.46 CDARS 2,571,221.46 2,571,221.46 Certificates of Deposit 744,000.00 744,000.00 Total Cash & Investments $94,642,175 $93,172,434 Benchmark 2.13% Investments As of 6/30/2019 Sweep 2.28% LOGIC Commercial Paper Investment Pool Average Quarterly Yield 2.54% TexSTAR Government Only Investment Pool Average Quarterly Yield 2.40% TexPOOL Government Only Investment Pool Average Quarterly Yield 2.41% CLASS Government Only Investment Pool Average Quarterly Yield 2.42% Total Government Only Investment Pool Average Quarterly Yield 2.41% Average Weighted Yield: Agency 1.59% City of Colleyville Page 2 Audit Committee Agenda Briefing 3b Average Weighted Yield: CDARS 1.44% Average Weighted Yield: CD'S 2.53% Interest earnings for the quarter were $501,257 compared to 431,840 last quarter, an increase of 16%. The increase is due to the 24% increase in funds invested in Government only investment pools and switching to a higher yielding sweep account. These percentages are within the guidelines of the City investment policy. Attachments 1.Quarterly Investment Report QUARTERLY INVESTMENT REPORT FOR QUARTER ENDING JUNE 30, 2019 THIS REPORT IS IN COMPLIANCE WITH THE PUBLIC FUNDS INVESTMENT ACT AND ADOPTED INVESTMENT POLICY STRATEGY Karen Hines Portfolio Investment Report for the Quarter Ending June 30, 2019 CONSOLIDATED INVESTMENT REPORT Current Last Quarter As of As of Cash and Investment Balances 6/30/2019 3/31/2019 Cash 7,640,202$ 5,209,519$ Sweep 15,175,903$ 15,478,377$ Commercial Paper Investment Pool 2,450,039$ 2,434,595$ Government Only Investment Pool 54,478,190$ 54,152,102$ Government Issuances 11,582,619$ 12,582,619$ CDARS 2,571,221$ 2,571,221$ Certificates of Deposit 744,000$ 744,000$ Total Cash & Investments 94,642,175$ 93,172,434$ Investment Yields, Maturities, and Interest Current Current As of As of 6/30/2019 3/31/2019 13 Week Treasury Benchmark 2.13%2.44% Sweep 2.28%2.28% LOGIC Commercial Paper Investment Pool Average Quarterly Yield 2.54%2.60% LOGIC Commercial Paper Investment Pool Quarter's Average Weighted Maturity 53 39 TexSTAR Government Only Investment Pool Average Quarterly Yield 2.40%2.40% TexSTAR Government Only Investment Pool Quarter's Average Weighted Maturity 23 41 TexPOOL Government Only Investment Pool Average Quarterly Yield 2.41%2.40% TexPOOL Government Only Investment Pool Quarter's Average Weighted Maturity 34 25 CLASS Government Only Investment Pool Average Quarterly Yield 2.42%2.42% CLASS Government Only Investment Pool Quarter's Average Weighted Maturity 46 47 Total Government Only Investment Pool Average Quarterly Yield 2.41%2.41% Total Government Only Investment Pool Quarter's Average Weighted Maturity 35 38 Average Weighted Yield: Agency 1.59%1.57% Average Weighted Maturity in Days: Agency 133 192 Average Weighted Yield: CDARS 1.44%1.44% Average Weighted Maturity in Days: CDARS 70 161 Average Weighted Yield: CD'S 2.53%2.53% Average Weighted Maturity in Days: CD'S 274 365 Interest Earnings - Quarter 501,257$ 431,840$ Portfolio Investment Report for the Quarter Ending June 30, 2019 CONSOLIDATED INVESTMENT REPORT Cash 8% Sweep 16% Commercial Paper Investment Pool 3% Government Only Investment Pool 57% Government Issuances 12% CDARS 3%Certificates of Deposit 1% CASH & INVESTMENT BALANCES Portfolio Investment Report for the Quarter Ending June 30, 2019 CONSOLIDATED INVESTMENT REPORT Distribution by Maturity Number 1 to 90 days 2 1,500,000$ 12.95%1,497,778.05$ 91 to 180 days 6 7,083,356$ 61.16%7,089,151.74$ 181 to 365 days 3 2,999,263$ 25.89%3,003,634.33$ Over 365 days 0 -$ 0.00%-$ Total 11 11,582,619$ 100%11,590,564$ Distribution by Type of Investment Number Federal Home Loan Bank (FHLB)3 $4,197,834 36%$4,194,455 Federal Farm Credit Bank (FFCB)5 $4,989,916 43%$5,001,249 Federal Home Loan Mortgage Corporation (FHLMC)3 $2,394,870 21%$2,394,860 Total 11 11,582,619$ 100%11,590,564$ Outstanding Security Portfolio Purchase Price Percent (Value)Market Value Outstanding Security Portfolio Purchase Price Percent (Value)Market Value 36%, Federal Home Loan Bank (FHLB) 43%, Federal Farm Credit Bank (FFCB) 21%, Federal Home Loan Mortgage Corporation (FHLMC) INVESTMENT SECURITY DISTRIBUTION BY TYPE ALL FUNDS CASH & INVESTMENT REPORTS 1 CASH & SWEEP CP POOLS GOV. POOLS*INVESTMENTS CDARS CD'S AS OF JUNE 30, 2019 001 GENERAL FUND (955,045) 301,903 12,266,201 1,000,000 1,543,297 744,000 14,900,356 036 STRATEGIC INITIATIVE 129,875 - 389,468 - - - 519,343 004 DEBT SERVICE FUND 849,223 - 35,586 - - - 884,809 003 CAPITAL PROJECTS 9,231,300 826,976 4,749,482 2,289,216 512,577 - 17,609,550 012 PARK LAND DEDICATION 129,920 - 250,171 1,110,308 - - 1,490,399 032 VEHICLE AND CAPITAL REPLACEMENT 25,023 - 1,194,851 364,300 - - 1,584,173 034 COLLEYVILLE TOMORROW 638,659 - 1,901,350 - - - 2,540,009 035 PARKS TOMORROW 267,407 - 801,902 - - - 1,069,309 005 VOLUNTARY PARK FUND 303,347 - 456,771 500,000 - - 1,260,117 007 DONATIONS FUND 42,452 - - - - - 42,452 011 VOLUNTARY LIBRARY FUND 137,955 - 340,169 - - - 478,124 015 POLICE ASSET FORFEITURE 6,038 - 16,922 - - - 22,960 016 GRANTS (ADVANCE PAYMENTS)30,761 - - - - - 30,761 018 TREE PRESERVATION 81,349 - 240,334 - - - 321,683 019 LIBRARY DONATION (39,599) - - - - - (39,599) 020 RECREATIONAL EVENT 21,717 - - - - - 21,717 023 LEOSE 1,894 - - - - - 1,894 027 CRIME DISTRICT 311,344 - 597,203 - - - 908,547 028 KIDSVILLE MAINTENANCE 2,013 - 3,885 - - - 5,898 029 COURT TECHNOLOGY 15,294 - 6,035 - - - 21,328 030 COURT SECURITY 20,424 - 34,145 - - - 54,569 033 PUBLIC ART 2,013 - 6,003 - - - 8,015 037 JUVENILE CASE MANAGER (2,320) - 11,665 - - - 9,345 038 HOTEL / MOTEL FUND 78,902 - 279,290 - - - 358,192 002 UTILITY FUND 1,013,977 - 4,986,600 1,724,471 515,348 - 8,240,396 039 UTILITY CAPITAL PROJECTS FUND 2,872,718 483,086 8,289,644 53,235 - - 11,698,682 017 DRAINAGE FEE 196,174 32,984 332,500 200,000 - - 761,658 041 DRAINAGE CAPITAL PROJECTS FUND 417,299 - 1,300,282 - - - 1,717,581 - 006 SESQUICENTINIAL FUND 18,160 - 3,275 - - - 21,436 008 EMPLOYEE ACTIVITY 2,951 - - - - - 2,951 040 INSURANCE TRUST FUND (ADV PMNT)(58,443) - - - - - (58,443) 026 TIF FUND 4,204,229 805,075 15,984,457 2,839,660 - - 23,833,421 19,997,011 2,450,023 54,478,190 10,081,190 2,571,221 744,000 90,321,635 024 CEDC 2,819,094 16 - 1,501,430 - - 4,320,540 22,816,105 2,450,039 54,478,190 11,582,619 2,571,221 744,000 94,642,175 Cash and cash equivalents are just one aspect of the City’s overall financial status, and it is necessary to look at the complete financial statements/CAFR for a comprehensive assessment. This is a management report prepared not in accordance with GASB DEBT SERVICE FUNDS CAPITAL PROJECT FUNDS SPECIAL REVENUE FUNDS ENTERPRISE FUNDS FIDUCIARY FUNDS GOVERNMENTAL FUNDS COLOR CODE CITY OF COLLEYVILLE ALL FUNDS CASH & INVESTMENT REPORT - TOTAL BY FUND CASH & INVESTMENT ENTERPRISE FUNDS FIDUCIARY FUNDS COMPONENT UNIT COLLEYVILLE ECON DEV CORP GRAND TOTAL 2 Available Available for Approved Restricted AS OF JUNE 30, 2019 Unrestricted Restricted Purpose Projects Unavailable 001 GENERAL FUND 14,780,883 34,560 - 84,913 14,900,356 036 STRATEGIC INITIATIVE 519,343 - - - 519,343 004 DEBT SERVICE FUND - 884,809 - - 884,809 003 CAPITAL PROJECTS 8,715,579 7,365,606 1,377,743 150,623 17,609,550 012 PARKLAND DEDICATION - 1,490,399 - - 1,490,399 032 VEHICLE AND CAPITAL REPLACEMENT - 1,584,173 - - 1,584,173 034 COLLEYVILLE TOMORROW 2,540,009 - - - 2,540,009 035 PARKS TOMORROW 1,069,309 - - - 1,069,309 005 VOLUNTARY PARK FUND - 1,260,117 - - 1,260,117 007 DONATIONS FUND - 42,452 - - 42,452 011 VOLUNTARY LIBRARY FUND - 478,124 - - 478,124 015 POLICE ASSET FORFEITURE 22,960 22,960 016 GRANTS - 30,761 - - 30,761 018 TREE PRESERVATION - 321,683 - - 321,683 019 LIBRARY DONATION - (39,599) - - (39,599) 020 RECREATIONAL EVENT - 21,717 - - 21,717 023 LEOSE - 1,894 - - 1,894 027 CRIME DISTRICT - 908,547 - - 908,547 028 KIDSVILLE MAINTENANCE - 5,898 - - 5,898 029 COURT TECHNOLOGY - 21,328 - - 21,328 030 COURT SECURITY - 54,569 - - 54,569 033 PUBLIC ART - 8,015 - - 8,015 037 JUVENILE CASE MANAGER - 9,345 - - 9,345 038 HOTEL FUND - 358,192 - - 358,192 002 UTILITY FUND 7,754,590 450 - 485,356 8,240,396 039 UTILITY CAPITAL PROJECTS FUND 5,266,039 5,309,422 1,070,991 52,231 11,698,682 017 DRAINAGE FEE 728,674 - - 32,984 761,658 041 DRAINAGE CAPITAL PROJECTS FUND 1,717,581 - - - 1,717,581 006 SESQUICENTENNIAL FUND 3,275 18,160 - - 21,436 008 EMPLOYEE ACTIVITY - - - 2,951 2,951 040 INSURANCE TRUST FUND (58,443) (58,443) 026 TIF FUND 23,083,421 - 750,000 - 23,833,421 66,178,705 20,193,582 3,198,733 750,614 90,321,635 024 CEDC 4,320,540 - - - 4,320,540 GRAND TOTAL 70,499,245 20,193,582 3,198,733 750,614 94,642,175 Cash and cash equivalents are just one aspect of the City’s overall financial status, and it is necessary to look at the complete financial statements/CAFR for a comprehensive assessment. The approved projects column represents the contracts awarded and approved by council. The department heads provide those numbers on a quarterly basis. This is a management report prepared not in accordance with GASB SPECIAL REVENUE FUNDS ENTERPRISE FUNDS FIDUCIARY FUNDS COLORCODE DEBT SERVICE FUNDS CAPITAL PROJECT FUNDS COMPONENT UNIT COLLEYVILLE ECON DEV CORP GOVERNMENTAL FUNDS CITY OF COLLEYVILLE ALL FUNDS CASH & INVESTMENT REPORT - RESTRICTIONS BY FUND CASH & INVESTMENTS ENTERPRISE FUNDS FIDUCIARY FUNDS REVENUE SOURCE PURPOSE/RESTRICTION 001 GENERAL FUND M&O portion of tax rate, sales tax, charges for service, etc.General government purposes 036 STRATEGIC INITIATIVES Transfers from the General Fund Programs/projects linked to the strategic plan; primarily used on eco. dev. incentives 004 DEBT SERVICE Debt (I&S) portion of the tax rate Payments on debt issued 003 CAPITAL PROJECTS Transfers from the General Fund, street impact fees, escrows Capital projects; some funding sources have restricted uses 012 PARK LAND DEDICATION Fees on new residential & commercial development Acquisition of land for new park sites or improvements/expansions of existing parks (no M&O) 032 VEHICLE AND CAPITAL REPLACEMENT Transfers from the General Fund Committed to server, equipment, and vehicle replacements 034 COLLEYVILLE TOMORROW Gas leases on City property Capital purchases/at Council discretion 035 PARKS TOMORROW Gas leases on City park property Parks capital projects 005 VOLUNTARY PARK FUND Donations through utility bills New or existing park capital costs (no M&O) 007 DONATIONS FUND Donations Only restricted if specified by donor 011 VOLUNTARY LIBRARY FUND Donations through utility bills Library activities- primarily purchase of books and materials (no M&O) 015 POLICE ASSET FORFEITURE Seizures Police operations as restricted by law 016 GRANTS Grants Track grant actvity 018 TREE PRESERVATION Tree mitigation fees Tree replanting on city-owned property 019 LIBRARY DONATION Donations Library needs or as specified by donor 020 RECREATIONAL EVENT Event revenue (like sale of tables)Special events expenses 023 LEOSE State of Texas Police training 027 CRIME DISTRICT (CCCPD)0.5 cent sales tax Public safety and crime control activities 028 KIDSVILLE MAINTENANCE Remaining donations Kidsville maintenance 029 COURT TECHNOLOGY Municipal court technology fee Court technology repairs, replacements, and upgrades 030 COURT SECURITY Municipal court building security fee Security-related expenses for the court (Bailiff) 033 PUBLIC ART 2008-9 Transfers from General, Utility, Drainage, CEDC Funds Public Art 037 JUVENILE CASE MANAGER Juvenile case manager fee Staff who handle juvenile defendants and their training 038 HOTEL/MOTEL FUND Hotel/Motel tax Attract "heads in beds"; specific uses outlined in state law 002 UTILITY OPERATING FUND Water and wastewater base rates and volumetric rates Utility operations and payments to TRA 017 DRAINAGE FEE FUND Monthly drainage fee Operations and capital projects related to drainage maintenance and improvement 039 UTILITY CAPITAL PROJECTS FUND Transfers from Utility Operating Fund, impact fees, CIP base rate Utility capital projects; water and wastewater impact fees have restricted uses 041 DRAINAGE- CAPITAL PROJECTS FUND Transfers from Drainage Operating Fund Drainage capital projects 006 SESQUICENTINIAL FUND Currently, sale of the Colleyville History book Created for fund raising for festivities related to 150th anniversary of Texas’ independence from Mexico (1986) 008 EMPLOYEE ACTIVITY Employee contributions Employee luncheons and other employee activities; governed by by-laws 040 INSURANCE TRUST FUND Payroll deductions and city's contributions Pass through trust fund used to account for employee insurance costs. Created cost savings for the city. 026 TIF FUND Incremental A/V revenue in the TIF District Projects in the Project Plan approved by all TIF partners 024 CEDC 0.5 cent sales tax For Library, Parks, and Colleyville Center; max. 10% on promotional expenses and special events 025 CEDC - CAPITAL Bond proceeds Bond projects: Library, City Park, McPherson Park, Colleyville Center capital projects COLOR CODE DEBT SERVICE FUNDS CAPITAL PROJECT FUNDS SPECIAL REVENUE FUNDS ENTERPRISE FUNDS FIDUCIARY FUNDS COLLEYVILLE ECON DEV CORP CITY FUNDS - BACKGROUND GOVERNMENTAL FUNDS ENTERPRISE FUNDS FIDUCIARY FUNDS COMPONENT UNIT LISTING OF INVESTMENTS BY TYPE FUND ALLOCATION AMOUNT PURCHASE DATE MATURITY DATE INTEREST RATE INTEREST EARNED DURING QUARTER UTILITY FUND $515,348 7/27/2017 7/25/2019 0.40%$514 GENERAL FUND $1,543,297 9/19/2018 9/19/2019 2.08%$7,997 CAPITAL PROJECTS $512,577 9/21/2017 9/19/2019 0.58%$741 PURCHASED DURING THIS QUARTER $0 $0 OUTSTANDING CDARS AT THE END OF THE QUARTER $2,571,221 $9,252 MATURED DURING THIS QUARTER $0 CDARS MATURED DURING THE QUARTER $0 $0 GRAND TOTAL 2,571,221 9,252 CDARS CERTIFICATES OF DEPOSIT FUND ALLOCATION AMOUNT PURCHASE DATE MATURITY/ SALE DATE Market Value INTEREST RATE INTEREST EARNED DURING QUARTER GENERAL FUND - CITIBANK $248,000 3/29/2018 3/30/2020 248,588.32 2.50%$1,546 GENERAL FUND - GOLDMAN SACHS BANK $248,000 4/11/2018 4/13/2020 248,715.86 2.55%$1,577 GENERAL FUND - HOPE BANK $248,000 9/14/2018 3/16/2020 248,660.60 2.55%$1,577 PURCHASED DURING THIS QUARTER $0 - $0 OUTSTANDING CD'S AT THE END OF THE QUARTER $744,000 $745,965 $4,699 MATURED/SOLD DURING THIS QUARTER $0 CD'S MATURED DURING THE QUARTER - - GRAND TOTAL 744,000 4,699 CD'S - CERTIFICATES OF DEPOSIT INTEREST CUSIP SECURITY PURCHASE MATURITY PURCHASE PAR MARKET LESS PLUS MARKET YIELD ON INTEREST TO MATURITY DATE DATE PRICE VALUE VALUE MATURITY PERIOD VALUE INVESTMENT 3/31/2019 PROCEEDS PURCHASES 6/30/2019 3133EHP98 FFCB NOTE 11/6/2017 11/6/2019 $1,000,000 $1,000,000 $995,564 $998,381 1.600%$3,989 $32,000 3137EAEH8 FHLMC NOTE 7/31/2017 8/15/2019 $500,000 $500,000 $498,063 $499,467 1.475%$1,839 $15,053 313380FB8 FHLB NOTE 8/29/2017 9/13/2019 $1,000,000 $1,000,000 $995,123 $998,311 1.375%$3,428 $28,065 3137EADM8 FHLMC NOTE 9/14/2017 10/2/2019 $998,788 $1,000,000 $915,842 $997,574.94 1.250%$3,116 $25,616 3137EADM8 FHLMC NOTE 10/13/2017 10/2/2019 $896,082 $900,000 $972,624 $897,817.45 1.250%$2,805 $22,161 3130ACLS1 FHLB NOTE 10/26/2017 10/11/2019 $2,200,000 $2,200,000 $2,189,320 $2,195,729 1.550%$8,501 $66,794 3133EHV75 FFCB NOTE 12/8/2017 11/21/2019 $749,711 $750,000 $747,028 $749,155 1.730%$3,235 $25,346 3133EGJ30 FFCB NOTE 12/29/2017 11/18/2019 $1,238,775 $1,255,000 $1,245,186 $1,250,494 1.100%$3,442 $26,059 3133EJCN7 FFCB NOTE 2/14/2018 2/14/2020 $1,000,000 $1,000,000 $997,245 $1,000,357 2.070%$5,161 $41,400 3130ADN32 FHLB NOTE 3/7/2018 2/11/2020 $997,834 $1,000,000 $997,206 $1,000,415 2.125%$5,298 $41,103 3133EJHL6 FFCB NOTE 4/9/2018 3/27/2020 $1,001,430 $1,000,000 $1,002,069 $1,002,862 2.300%$5,734 $45,244 PURCHASED DURING THIS QUARTER $0 $0 OUTSTANDING SECURITIES AT THE END OF THE QUARTER 11,582,619 11,605,000 11,555,269 - - 11,590,564 46,548 368,841 MATURED DURING THIS QUARTER 3133EHHN6 FFCB NOTE 5/3/2017 5/2/2019 $1,000,000 $1,000,000 $999,131 1.350%$3,366 $26,963 SECURITIES MATURED DURING THE QUARTER 1,000,000 1,000,000 999,131 - - 3,366 26,963 GRAND TOTAL 12,582,619 12,605,000 12,554,400 - - 11,590,564 49,913 395,804 INVESTMENT SECURITIES INVESTMENT FHLMC NOTE FHLB NOTE FHLMC NOTE DATE ACQUIRED 31-Jul-17 29-Aug-17 14-Sep-17 MATURITY DATE 15-Aug-19 13-Sep-19 02-Oct-19 26 WEEK T-BILL AUCTION DISCOUNT/WEEK OF PURCHASE 1.110%1.130%1.170% YIELD TO MATURITY 1.475%1.375%1.250% CUSIP#3137EAEH8 313380FB8 3137EADM8 ACCOUNT ALLOCATION OF INVESTMENT INVESTMENT- G/L TOTAL 001-1172 GENERAL FUND OPERATING $1,000,000.00 002-1172 UTILITY FUND OPERATING $1,283,897.54 11,346.71 002-1178 CUSTOMER DEPOSITS $440,572.99 039-1557 THE RESERVE LIFT STATION $53,235.06 53,235.06 003-1121 INV-PERIMETER FEES $1,965,370.14 712,932.38 998,788.00 003-1307 INV-ROAD RECONSTRUCTION $323,845.40 222,485.85 005-1172 VOLUNTARY PARK FUND $500,000.00 012-1172 PARK LAND DEDICATION FUND $1,110,308.31 017-1172 DRAINAGE FUND OPERATING $200,000.00 024-1172 CEDC OPERATING $1,501,429.87 500,000.00 026-1172 TIF OPERATING $2,839,660.15 032-1519 CAPITAL EQUIPMENT RESERVE $364,300.00 PER GENERAL LEDGER $11,582,619.46 $500,000.00 $1,000,000.00 $998,788.00 MARKET VALUE $11,590,564.12 $499,467.23 $998,310.82 $997,574.94 VALUE AT MATURITY $11,605,000.00 $500,000.00 $1,000,000.00 $1,000,000.00 INVESTMENT DATE ACQUIRED MATURITY DATE 26 WEEK T-BILL AUCTION DISCOUNT/WEEK OF PURCH YIELD TO MATURITY CUSIP# ACCOUNT ALLOCATION OF INVESTMENT 001-1172 GENERAL FUND OPERATING 002-1172 UTILITY FUND OPERATING 002-1178 CUSTOMER DEPOSITS 039-1557 THE RESERVE LIFT STATION 003-1121 INV-PERIMETER FEES 003-1307 INV-ROAD RECONSTRUCTION 005-1172 VOLUNTARY PARK FUND 012-1172 PARK LAND DEDICATION FUND 017-1172 DRAINAGE FUND OPERATING 024-1172 CEDC OPERATING 026-1172 TIF OPERATING 032-1519 CAPITAL EQUIPMENT RESERVE PER GENERAL LEDGER MARKET VALUE VALUE AT MATURITY FHLMC NOTE FHLB FFCB NOTE FFCB NOTE 13-Oct-17 26-Oct-17 06-Nov-17 29-Dec-17 02-Oct-19 11-Oct-19 06-Nov-19 18-Nov-19 1.250%1.260%1.280%1.500% 1.250%1.550%1.600%1.100% 3137EADM8 3130ACLS1 3133EHP98 3133EGJ30 18,422.28 500,000.00 250,985.36 194,005.33 253,649.76 101,359.55 500,000.00 300,000.00 200,000.00 200,000.00 513,360.00 700,000.00 1,238,774.84 364,300.00 $896,082.28 $2,200,000.00 $1,000,000.00 $1,238,774.84 $897,817.45 $2,195,729.23 $998,380.98 $1,250,494.17 $900,000.00 $2,200,000.00 $1,000,000.00 $1,255,000.00 INVESTMENT DATE ACQUIRED MATURITY DATE 26 WEEK T-BILL AUCTION DISCOUNT/WEEK OF PURCH YIELD TO MATURITY CUSIP# ACCOUNT ALLOCATION OF INVESTMENT 001-1172 GENERAL FUND OPERATING 002-1172 UTILITY FUND OPERATING 002-1178 CUSTOMER DEPOSITS 039-1557 THE RESERVE LIFT STATION 003-1121 INV-PERIMETER FEES 003-1307 INV-ROAD RECONSTRUCTION 005-1172 VOLUNTARY PARK FUND 012-1172 PARK LAND DEDICATION FUND 017-1172 DRAINAGE FUND OPERATING 024-1172 CEDC OPERATING 026-1172 TIF OPERATING 032-1519 CAPITAL EQUIPMENT RESERVE PER GENERAL LEDGER MARKET VALUE VALUE AT MATURITY FFCB NOTE FHLB NOTE FFCB NOTE FFCB NOTE 08-Dec-17 07-Mar-18 14-Feb-18 09-Apr-18 21-Nov-19 11-Feb-20 14-Feb-20 27-Mar-20 1.420%1.830%1.770%1.890% 1.730%2.125%2.070%2.300% 3133EHV75 3130ADN32 3133EJCN7 3133EJHL6 0.00 1,000,000.00 503,143.19 246,567.66 610,308.31 1,001,429.87 387,525.31 $749,710.85 $997,833.62 $1,000,000.00 $1,001,429.87 $749,154.97 $1,000,415.40 $1,000,356.60 $1,002,862.33 $750,000.00 $1,000,000.00 $1,000,000.00 $1,000,000.00 DESCRIPTION BALANCE GENERAL FUND LOGIC POOL- OPERATING CASH 301,903.08 UTILITY FUND - CAPITAL PROJECTS LOGIC POOL- WATER IMPACT FEES 148,479.71 LOGIC-RES CASH-UTILITY LINE RE 1,282.10 LOGIC - WW IMPACT FEES 333,323.96 CAPITAL PROJECTS FUND LOGIC POOL-ROADS SA I CASH 23,680.51 LOGIC-CAPITAL PROJ/STREET RESU 803,295.01 DRAINAGE FUND LOGIC- I&S FUND/DRAINAGE 32,984.24 TIF FUND LOGIC POOL- OPERATING CASH 805,074.87 GENERAL DISBURSING LOGIC ACCOUNT 2,450,023.48 CEDC Logic Balance LOGIC POOL- OPERATING CASH 15.92 Total LOGIC Balance 2,450,039.40 INTEREST EARNED 15,443.96 CITY OF COLLEYVILLE - INVESTMENT POOLS DESCRIPTION BALANCE GENERAL FUND TEXPOOL - OPERATING CASH 2,313,261.72 UTILITY FUND TEXPOOL - OPERATING CASH 2,148,275.80 UTILITY FUND - CAPITAL PROJECTS TEXPOOL - WW IMPACT FEES 705,444.32 TEXPOOL - WATER IMPACT FEE 2,345,585.66 TEXPOOL - OPERATING CASH 2,136,181.94 DEBT SERVICE FUND TEXPOOL - OPERATING CASH 35,585.76 DRAINAGE FUND TEXPOOL - OPERATING CASH 332,499.78 TIF FUND TEXPOOL - OPERATING CASH 10,894,508.93 CCCPD FUND TEXPOOL - OPERATING CASH 597,203.02 CAPITAL EQUIPMENT REPLACEMENT FUND TEXPOOL - OPERATING CASH 86,027.06 COLLEYVILLE TOMORROW FUND TEXPOOL - OPERATING CASH 1,752,776.38 PARKS TOMORROW FUND TEXPOOL - OPERATING CASH 801,901.90 STRATEGIC INITIATIVES FUND TEXPOOL - OPERATING CASH 389,468.48 DRAINAGE CAPITAL PROJECTS FUND TEXPOOL - OPERATING CASH 1,005,092.12 Total TexPool Balance 25,543,812.87 INTEREST EARNED 152,571.87 DESCRIPTION BALANCE GENERAL FUND TEXAS CLASS 6,369,453.71 CAPITAL PROJECTS FUND TEXAS CLASS 4,749,482.19 UTILITY FUND - CAPITAL PROJECTS TEXAS CLASS 3,102,432.03 TIF FUND TEXAS CLASS 4,076,995.56 Total Texas CLASS Balance 18,298,363.49 INTEREST EARNED 110,057.99 DESCRIPTION BALANCE GENERAL FUND TEXSTAR - OPERATING CASH 3,583,486.03 UTILITY FUND TEXSTAR - OPERATING CASH 2,838,324.35 VOLUNTARY PARK FUND TEXSTAR - OPERATING CASH 456,770.61 SESQUICENTINIAL FUND TEXSTAR - OPERATING CASH 3,275.48 VOLUNTARY LIBRARY FUND TEXSTAR - OPERATING CASH 340,169.21 PARK LAND DEDICATION FUND TEXSTAR - OPERATING CASH 250,170.56 POLICE ASSET FORFEITURE FUND TEXSTAR - OPERATING CASH 16,921.57 TREE PRESERVATION FUND TEXSTAR - OPERATING CASH 240,333.52 TIF FUND TEXSTAR - OPERATING CASH 1,012,952.66 KIDSVILLE MAINTENANCE FUND TEXSTAR - OPERATING CASH 3,884.97 COURT TECHNOLOGY FUND TEXSTAR - OPERATING CASH 6,034.90 COURT SECURITY FUND TEXSTAR - OPERATING CASH 34,145.12 VEHICLE AND CAPITAL REPLACEMENT FUND TEXSTAR - OPERATING CASH 1,108,823.52 PUBLIC ART FUND TEXSTAR - OPERATING CASH 6,002.64 COLLEYVILLE TOMORROW FUND TEXSTAR - OPERATING CASH 148,573.52 JUVENILE CASE MANAGER FUND TEXSTAR - OPERATING CASH 11,664.60 HOTEL/MOTEL FUND FUND TEXSTAR - OPERATING CASH 279,290.20 DRAINAGE- CAPITAL PROJECTS FUND TEXSTAR - OPERATING CASH 295,189.70 Total TexSTAR Balance 10,636,013.16 INTEREST EARNED 63,457.28 NewsPerformanceNew Participants We would like to welcome the following entities who joined the LOGIC program in June: Wilmer Economic Development Corporation A Wilmer Economic Development Corporation B Conferences Texas Association of State Senior College and University Business Ofﬁ cers Summer Conference, July 7-9, San Antonio County Treasurers Association of Texas Annual Conference, Sep 9-12, Tyler Texas Association of School Administrators/Texas Association of School Boards Annual Conference, Sep 20-22, Dallas LOGIC Newsletter June 2019 Economic Commentary It was all going so well. The Fed had decided early in the year to end three years of tightening, taking pressure off the markets. Other major central banks validated this by tilting dovishly. The markets rejoiced by drifting higher: yields moved lower, credit spreads narrowed, and other asset classes drafted off the stability in the bond market and central banking. Nevertheless, for the last 18 months, our primary concerns have been about the trade negotiations between the U.S. and China and then between the U.S. and the rest of the world. Quite simply, we feared tariff escalation would reduce trade, which would negatively affect GDP and, ultimately, bring forward the probability of recession. In May, our fears became reality and forced us to make a call on what is effectively a binary outcome: either both a trade compromise and the extension of a recovery or an all-out trade war bringing us a step closer to recession. The use of tariffs not just to normalize a structural trade disadvantage but to achieve policies and agreements is worrisome. Markets are hopeful that the tailwind of a coordinated central bank response will somewhat offset the headwind of a trade war. The reaction function of the major central banks has shifted, and it is now evident that policymakers are aiming to be ahead of the curve. This was corroborated on June 19, when Fed Chairman Jerome Powell quoted the axiom “an ounce of prevention is worth a pound of cure” in reference to his current monetary policy mindset. Recent US data prints have been mixed to negative—though, importantly, central bankers have indicated that they will ease policy even against a stable data backdrop, given the trade-related uncertainty. The G20 summit at the end of June provided a welcomed truce in the U.S.-China trade war, with negotiations to restart at an undeﬁ ned date. While maintaining the tariffs already in place, the U.S. agreed to delay implementing the next round of tariffs on approximately $300bn of imports. Despite this positive news, the latest survey of businesses suggests growth momentum continues to slide. It therefore appears likely that the sustained period of U.S. economic and monetary policy divergence versus the rest of the world is coming to an end. With no date in sight for the start of renewed negotiations, we believe the trade war will linger on. Amid this uncertainty, we expect the Fed to ease two to three times in 2019 starting in July. This information is an excerpt from an economic report dated June 2019 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, 2019 Current Invested Balance $6,678,845,642.86 Weighted Average Maturity (1)* 52 Days Weighted Average Maturity (2)* 80 Days Net Asset Value 1.000187 Total Number of Participants 603 Management Fee on Invested Balance 0.0975% Interest Distributed $14,497,464.15 Management Fee Collected $546,238.67 % of Portfolio Invested Beyond 1 Year 0.00% Standard & Poor’s Current Rating AAAm June Averages: Average Invested Balance $6,809,258,662.27 Average Monthly Yield, on a simple basis 2.4927% Average Weighted Average Maturity (1)* 53 Days Average Weighted Average Maturity (2)* 83 Days Distribution of Participants by Type As of June31, 2011 Portfolio by Maturity As of June31, 2011 Information at a Glance HistoryHistorical Program Information Average Book Market Net Number of Month Rate Value Value Asset Value WAM (1)* WAM (2)* Participants Jun 19 2.4927% $6,678,845,642.86 $6,680,097,200.26 1.000187 53 83 603 May 19 2.5410% 6,902,363,717.50 6,902,977,310.94 1.000010 55 85 601 Apr 19 2.5838% 7,102,256,313.78 7,102,595,058.50 1.000047 50 77 598 Mar 19 2.6015% 7,337,871,011.97 7,337,944,552.70 1.000010 39 70 595 Feb 19 2.6090% 7,628,880,062.17 7,629,799,651.08 1.000120 43 74 590 Jan 19 2.5949% 7,520,879,084.28 7,521,195,255.96 1.000042 36 61 588 Dec 18 2.4805% 6,949,078,936.52 6,948,456,687.31 0.999870 38 62 586 Nov 18 2.4072% 6,560,982,375.72 6,560,576,218.42 0.999938 45 78 583 Oct 18 2.3320% 6,022,652,132.65 6,022,591,550.03 0.999989 46 87 581 Sep 18 2.2112% 6,222,015,405.64 6,222,101,273.25 1.000013 34 69 576 Aug 18 2.1843% 6,457,668,295.78 6,458,782,262.06 1.000073 34 66 574 Jul 18 2.1750% 6,693,358,601.72 6,694,255,228.51 1.000133 30 59 573 Assets Book Value Market Value Uninvested Balance $ 44.14 $ 44.14 Accrual of Interest Income 6,243,994.56 6,243,994.56 Interest and Management Fees Payable (14,590,978.12) (14,590,978.12) Payable for Investment Purchased 0.00 0.00 Receivable for Investment Sold 0.00 0.00 Repurchase Agreements 857,954,999.91 857,954,999.91 Commercial Paper 5,729,908,671.01 5,731,076,903.77 Government Securities 99,328,911.36 99,412,236.00 Total $6,678,845,642.86 $ 6,680,097,200.26 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, 2019 Repurchase Agreements 12.83% 8 to 30 days 17.60% 1 to 7 days 31.57% 31 to 90 days 27.38% Utility District 16.58% Other 7.97% School District 34.49% Health Care 1.66% County 9.78% Higher Education 2.65% City 26.87% Distribution of Participants by Type As of June 30, 2019 Portfolio by Type of Investment As of June 30, 2019 Portfolio by Maturity As of June 30, 2019 91 to 180 days 19.33% Commercial Paper 85.68% 180+ days 4.12% Treasuries 1.49% Mny Mkt Fund Daily Allocation LOGIC Invested Market Value WAM WAM Date Equiv. [SEC Std.] Factor Balance Per Share Days (1)* Days (2)* 6/1/2019 2.5325% 0.000069383 $6,902,363,717.50 1.000010 51 83 6/2/2019 2.5325% 0.000069383 $6,902,363,717.50 1.000010 51 83 6/3/2019 2.5095% 0.000068754 $6,896,126,192.90 1.000077 53 85 6/4/2019 2.5082% 0.000068718 $6,887,509,126.49 1.000112 54 85 6/5/2019 2.5067% 0.000068678 $6,890,757,675.65 1.000127 53 84 6/6/2019 2.5067% 0.000068676 $6,885,418,953.01 1.000123 52 84 6/7/2019 2.4998% 0.000068489 $6,868,511,554.64 1.000094 55 86 6/8/2019 2.4998% 0.000068489 $6,868,511,554.64 1.000094 55 86 6/9/2019 2.4998% 0.000068489 $6,868,511,554.64 1.000094 55 86 6/10/2019 2.4959% 0.000068382 $6,877,000,254.51 1.000185 55 85 6/11/2019 2.4942% 0.000068333 $6,938,730,480.75 1.000179 54 83 6/12/2019 2.4916% 0.000068263 $6,957,430,083.08 1.000174 53 82 6/13/2019 2.4914% 0.000068257 $6,894,267,904.44 1.000184 53 82 6/14/2019 2.4859% 0.000068106 $6,853,728,354.50 1.000116 50 80 6/15/2019 2.4859% 0.000068106 $6,853,728,354.50 1.000116 50 80 6/16/2019 2.4859% 0.000068106 $6,853,728,354.50 1.000116 50 80 6/17/2019 2.4942% 0.000068333 $6,803,766,744.77 1.000205 50 80 6/18/2019 2.4900% 0.000068220 $6,775,428,347.94 1.000214 56 85 6/19/2019 2.4822% 0.000068006 $6,759,321,740.12 1.000184 55 85 6/20/2019 2.4804% 0.000067956 $6,729,862,007.13 1.000222 57 86 6/21/2019 2.4737% 0.000067773 $6,712,527,894.13 1.000139 55 84 6/22/2019 2.4737% 0.000067773 $6,712,527,894.13 1.000139 55 84 6/23/2019 2.4737% 0.000067773 $6,712,527,894.13 1.000139 55 84 6/24/2019 2.4761% 0.000067837 $6,689,352,766.54 1.000221 55 83 6/25/2019 2.4772% 0.000067868 $6,759,883,381.67 1.000248 54 82 6/26/2019 2.4808% 0.000067968 $6,705,866,941.85 1.000248 53 82 6/27/2019 2.4782% 0.000067896 $6,681,469,493.88 1.000250 54 82 6/28/2019 2.4910% 0.000068247 $6,678,845,642.86 1.000187 52 80 6/29/2019 2.4910% 0.000068247 $6,678,845,642.86 1.000187 52 80 6/30/2019 2.4910% 0.000068247 $6,678,845,642.86 1.000187 52 80 Average 2.4927% 0.000068292 $6,809,258,662.27 53 83 Daily RatesDaily Summary for June 2019 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 may 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. The LOGIC yield is calculated in accordance with regulations governing the registration of open-end management investment companies under the Investment Company Act of 1940 as promulgated from time to time by the federal Securities and Exchange Commission.Daily RatesDaily Summary0.00 0.25 0.50 0.75 1.00 1.25 1.50 1.75 2.00 2.25 2.50 2.75 90 Day T-BILL Rate LOGIC Rate ContactsFor more information, please contact LOGIC Participant Services 1201 Elm Street, Suite 3500 Dallas, Texas 75270 1-800-895-6442 www.logic.orgLOGIC BoardLOGIC Board Members Philip G. Roberson Arlington ISD Governing Board President Sandra Newby Tarrant Regional Water District Governing Board Vice President Greg Jordan City of Grapevine Governing Board Secretary Erik Felthous North Texas Municipal Water District Governing Board Treasurer David Rastellini Northside ISD Advisory Board Eric Cannon City of Allen/ Qualiﬁ ed Non-Participant Advisory Board The material provided to LOGIC from J.P. Morgan Asset Management, Inc., the investment manager of the LOGIC pool, is for informational and educational purposes only, as of the date of writing and may change at any time based on market or other conditions and may not come to pass. While we believe the information presented is reliable, we cannot guarantee its accuracy. HilltopSecurities is a wholly owned subsidiary of Hilltop Holdings, Inc. (NYSE: HTH) located at 1201 Elm Street, Suite 3500, Dallas, Texas 75270, (214) 859-1800. Member NYSE/FINRA/ SIPC. Past performance is no guarantee of future results. Investment Management Services are offered through J.P. Morgan Asset Management Inc. and/or its afﬁ liates. Marketing and Enrollment duties are offered through HilltopSecurities and/or its afﬁ liates. HilltopSecurities and J.P. Morgan Asset Management Inc. are separate entities. Monthly Newsletter — June 2019 For more information about TexSTAR, please visit our web site at www.texstar.org. Performance As of June 30, 2019 Current Invested Balance $8,072,061,682.23 Weighted Average Maturity (1) 15 Days Weighted Average Maturity (2) 97 Days Net Asset Value 1.000019 Total Number of Participants 906 Management Fee on Invested Balance 0.06%* Interest Distributed $16,376,931.59 Management Fee Collected $402,887.10 % of Portfolio Invested Beyond 1 Year 11.38% Standard & Poor’s Current Rating AAAm Rates reflect historical information and are not an indication of future performance. June Averages Average Invested Balance $8,169,346,653.88 Average Monthly Yield, on a simple basis 2.3790% Average Weighted Average Maturity (1)* 19 Days Average Weighted Average Maturity (2)* 103 Days 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. * The maximum management fee authorized for the TexSTAR Cash Reserve Fund is 12 basis points. This fee may be waived in full or in part in the discretion of the TexSTAR co-administrators at any time as provided for in the TexSTAR Information Statement. Economic Commentary The Fed kept rates unchanged at 2.25%-2.50% at its June Federal Open Market Committee meeting, a move that was widely anticipated, but the decision in aggregate was dovish. The committee highlighted recent headwinds, such as rising trade uncertainty combined with muted inﬂ ation and softer global growth as reasons to closely monitor data in the second half of the year, and indicated that the FOMC would act as necessary to sustain the expansion. It was all going so well. The Fed had decided early in the year to end three years of tightening, taking pressure off the markets. Other major central banks validated this by tilting dovishly. The markets rejoiced by drifting higher: yields moved lower, credit spreads narrowed, and other asset classes drafted off the stability in the bond market and central banking. Nevertheless, for the last 18 months, our primary concerns have been about the trade negotiations between the U.S. and China and then between the U.S. and the rest of the world. Quite simply, we feared tariff escalation would reduce trade, which would negatively affect GDP and, ultimately, bring forward the probability of recession. In May, our fears became reality and forced us to make a call on what is effectively a binary outcome: either both a trade compromise and the extension of a recovery or an all-out trade war bringing us a step closer to recession. The use of tariffs not just to normalize a structural trade disadvantage but to achieve policies and agreements is worrisome. Markets are hopeful that the tailwind of a coordinated central bank response will somewhat offset the headwind of a trade war. The reaction function of the major central banks has shifted, and it is now evident that policymakers are aiming to be ahead of the curve. This was corroborated on June 19, when Fed Chairman Jerome Powell quoted the axiom “an ounce of prevention is worth a pound of cure” in reference to his current monetary policy mindset. Recent US data prints have been mixed to negative—though, importantly, central bankers have indicated that they will ease policy even against a stable data backdrop, given the trade-related uncertainty. The G20 summit at the end of June provided a welcomed truce in the U.S.-China trade war, with negotiations to restart at an undeﬁ ned date. While maintaining the tariffs already in place, the U.S. agreed to delay implementing the next round of tariffs on approximately $300bn of imports. Despite this positive news, the latest survey of businesses suggests growth momentum continues to slide. It therefore appears likely that the sustained period of U.S. economic and monetary policy divergence versus the rest of the world is coming to an end. With no date in sight for the start of renewed negotiations, we believe the trade war will linger on. Amid this uncertainty, we expect the Fed to ease two to three times in 2019 starting in July. This information is an excerpt from an economic report dated June 2019 provided to TexSTAR by JP Morgan Asset Management, Inc., the investment manager of the TexSTAR pool. New Participants We would like to welcome the following entities who joined the TexSTAR program in June: Harris County MUD No. 358 Montgomery County MUD No. 107 Wilmer Economic Development Corporation AWilmer Economic Development Corporation B Distribution of Participants by Type As of June 30, 2019 Portfolio by Type of Investment As of June 30, 2019 Book Value Market Value Uninvested Balance $ 364.52 $ 364.52 Accrual of Interest Income 11,090,143.62 11,090,143.62 Interest and Management Fees Payable (16,412,379.87) (16,412,379.87) Payable for Investment Purchased 0.00 0.00 Repurchase Agreement 3,419,281,999.78 3,419,281,999.78 Government Securities 4,658,101,554.18 4,658,261,899.68 Total $ 8,072,061,682.23 $ 8,072,222,027.73 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 TexSTAR. The only source of payment to the Participants are the assets of TexSTAR. 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 TexSTAR Participant Services. Information at a Glance Portfolio Asset Summary as of June 30, 2019 Average Book Market Net Number of Month Rate Value Value Asset Value WAM (1)* WAM (2)* Participants Jun 19 2.3790% $ 8,072,061,682.23 $8,072,222,027.73 1.000019 19 103 906 May 19 2.4048% 8,251,300,232.20 8,251,929,597.00 1.000042 25 105 902 Apr 19 2.4243% 8,464,290,753.69 8,464,331,283.11 1.000004 26 101 895 Mar 19 2.4112% 8,378,300,782.34 8,378,032,817.90 0.999968 41 106 893 Feb 19 2.4001% 9,198,012,187.60 9,197,689,206.82 0.999964 45 99 891 Jan 19 2.3937% 8,624,044,987.80 8,623,938,284.28 0.999987 37 82 890 Dec 18 2.3069% 7,738,483,374.11 7,738,245,287.60 0.999940 40 95 888 Nov 18 2.2176% 6,683,233,268.87 6,682,898,473.43 0.999949 41 102 886 Oct 18 2.1615% 6,581,942,899.40 6,581,269,831.00 0.999897 41 101 884 Sep 18 1.9995% 6,458,418,968.50 6,458,002,746.78 0.999935 30 96 883 Aug 18 1.9225% 6,701,017,159.16 6,701,228,119.73 0.999971 24 91 879 Jul 18 1.8965% 6,837,425,331.68 6,837,427,966.67 1.000000 19 84 877 Agencies 46.22% 1 to 7 days 62.29% 31 to 90 days 20.41% 8 to 30 days 14.84% City 25.83% Health Care 3.09% County 6.07% Other 8.17% Historical Program Information Portfolio by Maturity As of June 30, 2019 Repurchase Agreements 42.33% Treasuries 11.45% School District 30.35% Higher Education 2.76% Utility District 23.73% 91 to 180 days 2.46% 0.00 0.25 0.50 0.75 1.00 1.25 1.50 1.75 2.00 2.25 2.50 2.75 TexSTAR Rate 90 Day T-BILL Rate TexSTAR versus 90-Day Treasury Bill Mny Mkt Fund Daily Allocation TexSTAR Invested Market Value WAM WAM Date Equiv. [SEC Std.] Factor Balance Per Share Days (1)* Days (2)* 6/1/2019 2.4394% 0.000066832 $8,251,300,232.20 1.000042 22 105 6/2/2019 2.4394% 0.000066832 $8,251,300,232.20 1.000042 22 105 6/3/2019 2.3941% 0.000065591 $8,260,084,465.02 1.000041 23 108 6/4/2019 2.3844% 0.000065327 $8,245,076,040.48 1.000068 23 108 6/5/2019 2.3799% 0.000065203 $8,219,067,761.86 1.000054 22 108 6/6/2019 2.3850% 0.000065342 $8,177,925,281.26 1.000063 22 107 6/7/2019 2.3848% 0.000065336 $8,148,823,587.34 1.000062 21 106 6/8/2019 2.3848% 0.000065336 $8,148,823,587.34 1.000062 21 106 6/9/2019 2.3848% 0.000065336 $8,148,823,587.34 1.000062 21 106 6/10/2019 2.3824% 0.000065271 $8,113,362,050.17 1.000066 21 107 6/11/2019 2.3753% 0.000065076 $8,081,872,285.75 1.000061 21 107 6/12/2019 2.3743% 0.000065048 $8,111,223,170.94 1.000055 20 106 6/13/2019 2.3638% 0.000064762 $8,058,026,269.40 1.000055 20 105 6/14/2019 2.3494% 0.000064367 $8,193,538,635.92 1.000048 20 104 6/15/2019 2.3494% 0.000064367 $8,193,538,635.92 1.000048 20 104 6/16/2019 2.3494% 0.000064367 $8,193,538,635.92 1.000048 20 104 6/17/2019 2.3754% 0.000065080 $8,181,487,957.21 1.000058 19 103 6/18/2019 2.3675% 0.000064864 $8,242,546,064.81 1.000056 19 102 6/19/2019 2.3521% 0.000064441 $8,212,112,336.33 1.000088 19 102 6/20/2019 2.3477% 0.000064321 $8,214,418,888.24 1.000042 18 101 6/21/2019 2.3567% 0.000064568 $8,192,871,842.63 1.000042 17 100 6/22/2019 2.3567% 0.000064568 $8,192,871,842.63 1.000042 17 100 6/23/2019 2.3567% 0.000064568 $8,192,871,842.63 1.000042 17 100 6/24/2019 2.3706% 0.000064948 $8,158,145,581.42 1.000042 17 99 6/25/2019 2.3732% 0.000065019 $8,163,996,395.27 1.000029 17 99 6/26/2019 2.3861% 0.000065373 $8,122,498,000.55 1.000023 16 99 6/27/2019 2.3716% 0.000064974 $8,194,069,359.01 1.000013 16 97 6/28/2019 2.4121% 0.000066086 $8,072,061,682.23 1.000019 15 97 6/29/2019 2.4121% 0.000066086 $8,072,061,682.23 1.000019 15 97 6/30/2019 2.4121% 0.000066086 $8,072,061,682.23 1.000019 15 97 Average 2.3790% 0.000065179 $8,169,346,653.88 19 103 Daily Summary for June 2019 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 may be subject to change. The TexSTAR management fee may be waived in full or in part at the discretion of the TexSTAR co- administrators and the TexSTAR 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 TexSTAR pool to the T-Bill Yield, you should know that the TexSTAR 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. The TexSTAR yield is calculated in accordance with regulations governing the registration of open-end management investment companies under the Investment Company Act of 1940 as promulgated from time to time by the federal Securities and Exchange Commission. TexSTAR Board Members William Chapman Central Texas Regional Mobility Authority Governing Board President Nell Lange City of Frisco Governing Board Vice President Eric Cannon City of Allen Governing Board Treasurer David Medanich Hilltop Securities Governing Board Secretary Jennifer Novak J.P. Morgan Asset Management Governing Board Asst. Sec./Treas. Monte Mercer North Central TX Council of Government Advisory Board Becky Brooks City of Grand Prairie Advisory Board Nicole Conley Austin ISD Advisory Board David Pate Richardson ISD Advisory Board James Mauldin University of North Texas System Advisory Board Sandra Newby Tarrant Regional Water District/Non-Participant Advisory Board Ron Whitehead Qualiﬁ ed Non-Participant Advisory Board TexSTAR Participant Services 1201 Elm Street, Suite 3500 Dallas, TX 75270 1-800-839-7827 The material provided to TexSTAR from J.P. Morgan Asset Management, Inc., the investment manager of the TexSTAR pool, is for informational and educational purposes only, as of the date of writing and may change at any time based on market or other conditions and may not come to pass. While we believe the information presented is reliable, we cannot guarantee its accuracy.HilltopSecurities is a wholly owned subsidiary of Hilltop Holdings, Inc. (NYSE: HTH) located at 1201 Elm Street, Suite 3500, Dallas, Texas 75270, (214) 859-1800. Member NYSE/ FINRA/SIPC. Past performance is no guarantee of future results. Investment Management Services are offered through J.P. Morgan Asset Management Inc. and/or its afﬁ liates. Marketing and Enrollment duties are offered through HilltopSecurities and/ or its afﬁ liates. HilltopSecurities and J.P. Morgan Asset Management Inc. are separate entities. June 2019 Portfolio Characteristics -Texa s CLASS Page I of 13 Texas CLASS Portfolio Characteristics The following i nformation is provid ed in accordance with Te x as State Statute 2256 .0016 . ~ Print As of June 30, 2019: Municipalit y 20.33% Participant Breakdown by Balance Money Market Funds 1.13% U.S. Treasury Securities 4 .10% Commercial Paper A-1/P-1 4 3.50% Repurchase A~reements 1.100/o Government Obligation 0 .110/a Commerci al Paper A-1+/P-1 50.06% Texas CLASS Portfolio Breakdown Special District _ 37.45% . Othe r _, 6 .57% Participant Breakdown by Entity Type U.S. Treasury Securities 53.84% Texas CLASS Government Portfolio Breakdown https://www.texasc lass.com/june-2019-portfolio -characteristics/ 2.80% :.:::~ 1.30% 0 .80% 0 .30% Jun-18 Sep-18 Dec-18 Mar-19 Jun -19 -Texas CLASS S&P LGIP 30D -Te xas CLASS Go vernment -S&.P LGIPG30N Performance vs. Benchmark S&P AAA/AA GIP * (Average Monthly Yields) 100 Jun -18 Sep-18 Dec-18 Mar-19 Jun-19 - -Te xas CLASS (WAM to Reset) - -Texas CLASS Government (WAM to Reset ) -Te xas CLASS (WAM to Final ) Texas CLASS Government (WAM to Final) Weighted Average Maturity (In Days) 7/26 /2019 June 2019 Po rtfolio Characteristics -Texas CLASS Page 2of13 Texas CLASS Prior Month Comparison Month End Apr-19 Average Yield** 2.58% Month Ending Assets $10,698,896,336 Share Balance $10,699,366,237 Market Value $10,844,981,754 Amortized Cost $10,845,451,655 NAV 1.00 WAM (Reset)*** 44 WAM (Final)*** 71 Month End May-19 Average Yield ** 2.56% Month Ending Assets $10,398,675,974 Share Balance $10,398,857,986 Market Value $10,444,278, 7 64 Amortized Cost $10,444,460, 777 NAV 1.00 WAM (Reset)*** 47 WAM (Final)*** 79 https://www.texasclass .com/j une-2019-portfoli o-characteristics/ 7/26/2019 June 2019 Portfolio Characteristics -Texas CLASS Page 3of13 Month End Jun-19 Average Yield** 2.51% Month Ending Assets $9,686,681,281 Share Balance $ 9 ,685,608,842 Market Value $9,683,490,806 Amortized Cost $9,682,418,367 NAV 1.00 WAM {Reset)*** 51 WAM {Final)*** 76 **Average monthly yield ***As of the end of the last day of the month http s://www.texasc la ss .com/j une-2019-portfolio-characte ri stics/ 7/26 /20 19 June 2019 Portfolio Characteristics -Texas CLASS Page 4of13 Texas CLASS Government Prior Month Comparison Month End Apr-19 Average Yield ** 2.45% Month Ending Assets $625,745,746 Share Balance $625,746,419 Market Value $625,569,522 Amortized Cost $625,570,195 NAV 1.00 WAM (Reset)*** 43 WAM (Final)*** 63 Month End May-19 Average Yield ** 2.42% Month Ending Assets $630,253,844 Share Balance $630,260,379 Market Value $630,023,096 Amortized Cost $630,029,632 NAV 1.00 WAM (Reset)*** 39 WAM (Final)*** 65 https ://www.texasc lass .com/j une-2019-portfol i o-characteristics/ 7/26/2019 June 20 19 Portfolio Characteristics -Te xa s CLASS Page 5of13 Month End Jun-19 Average Yield** 2.39% Month Ending Assets $628, 904, 980 Share Balance $628,810,151 Market Value $631,167,601 Amortized Cost $631,072, 773 NAV 1.00 WAM {Reset)*** 57 WAM {Final)*** 80 **Average monthly yield ***As of the end of the last day of the month 2018-19 Texas CLASS Average Monthly Yields Month End August Average Yield ** 2018 Month Ending Assets 2 .2432% Share Balance Market Value August Amortized Cost 2018 NAV 1.9671% https ://www .texasclass .com/june-2019-portfolio -characteristics/ 7/26 /2019 June 2019 Portfolio Characteristics -Texas CLASS Page 6of13 Month End September Average Yield ** 2018 Month Ending Assets 2.2647% Share Balance Market Value September Amortized Cost 2018 NAV 2.0142% Month End October Average Yield ** 2018 Month Ending Assets 2.3422% Share Balance Market Value October Amortized Cost 2018 NAV 2.1443% https://www.texasclass .com/june-2019-portfolio-characteristics/ 7/26 /2019 June 2019 Portfolio Characteristics -Texas CLASS Page 7of13 Month End November Average Yield ** 2018 Month Ending Assets 2.4244% Share Balance Market Value November Amortized Cost 2018 NAV 2 .2645% Month End December Average Yield ** 2018 Month Ending A ss et s 2.5045% Share Balance Market Value December Amortized Cost 2018 NAV 2.3379% https://www. texasclass.corn/j une-2019-portfolio-characteristics/ 7/26/2019 June 2019 Portfolio Characteristics -Texas CLASS Page 8of13 Month End January Average Yield ** 2019 Month Ending Assets 2.6240% Share Balance Market Value January Amortized Cost 2019 NAV 2.4211% Month End February Average Yield ** 2019 Month Ending Assets 2.6340% Share Balance Market Value February Amortized Cost 2019 NAV 2.4116% https://www.texasclass .com/june-2019-portfolio-c haracteristics / 7/26/2019 June 2019 Portfolio Characte ri sti cs -Texas CLA S S Page 9of13 Month End March Average Yield ** 2019 Month Ending Assets 2.6113 % Share Balance Market Value March Amortized Cost 2019 NAV 2.4258 % Month End April Average Yield ** 2019 Month Ending Assets 2.5831% Share Balance Market Value April Amortized Cost 2019 NAV 2.4481% https ://www.texascl ass .co m/j un e -2 019 -portfolio-characteri sti cs / 7/26/2019 June 20 19 Portfolio Characteristics -Texas CLASS Page 10of13 Month End May Average Yield** 2019 Month Ending Assets 2.5565% Share Balance Market Value May Amortized Cost 2019 NAV 2.4195% Month End June Average Yield ** 2019 Month Ending Assets 2.5050% Share Balance Market Value June Amortized Cost 2019 NAV 2.3921% https://www. texasclass.corn/june-2019-portfolio-characteristics/ 7/26 /20 19 Jun e 2 01 9 Portfoli o C haracter ist ics -Texas CLASS Page 11 of 13 Fund Highlights as of June 30, 2019 (Unaudited) For the month of June 2019, the Program Administrator accrued fees of $798,404.14 and had average shares outstanding of 10,126,574,358.06 for Texas CLASS. For Texas CLASS Government, the Program Administrator accrued fees of $4,390.47 and had average shares outstanding of 627,709,168.94. The fees for both Texas CLASS and Texas CLASS Government are accrued on a daily basis by multiplying the investment property value by the applicable fee rate , and divided by 365 or 366 days in the event of a leap year. The investment property value shall be based on the current day's shares outstanding. For weekend days and holidays , the shares outstanding for the previous business day will be utilized for the calculation of fees. The applicable fee rate is located in Exhibit F of the Eighth Amended and Restated Trust Agreement. The Program Administrator reserves the right to abate fees listed in the Eighth Amended and Restated Trust Agreement. The monthly fee is the sum of all daily fee accruals for the month of June. The fees are paid monthly upon notification to the custodian bank. As of June 30, 2019, the fee for Texas CLASS was 10 basis points and the fee for Texas CLASS Government was 1 basis point. • Both funds are rated 'AAAm ' by S&P Global Ratings . • Net Asset Value for both funds from June 1 to June 30, 2019 is equal to $1.00. • The final maturity dates of all securities were less than one year. • The custodian bank for Texas CLASS is Wells Fargo Bank, N.A. • Total number of Participants is 761. • There are currently no investments that have a stated maturity greater than one year. • The portfolio managers for Texas CLASS are Randy Palomba , CFA and Neil Waud , CFA. • All sources of payment are the underlying assets of the local government investment pool at market value . • The Eighth Amended and Restated Trust Agreement was adopted by the Board of Trustees on April 8 , 2019. You can access your copy of the Eighth Amended and Restated Trust Agreement by clicking here (https:Uwww.texasclass.com/wp- http s://www.texasc lass.com/j un e -20 19-portfo li o-c haracte ri stics / 7/26 /20 19 June 20 19 Portfolio Characteristics -Texas CLASS Page 12of13 content/uploads/2019 /04/Eighth-Amended-and-Restated-T exas-CLASS-Trust- Agreement-Website.pdf). To view the current members of the Texas CLASS Board of Trustees and Advisory Board, please click here (https:ljwww.texasclass.com/boa rds/). Prior Months' Portfolio Characteristics May31,2019 View (https:Uwww.texasclass.com/may-2019-portfol io-characteristics/) April 30, 2019 View (https :Uwww.texasclass.com/apri 1-2 019-portfol i a-characteristics/) March 31, 2019 View (https:Uwww.texasclass.com/march -2 019-p ortfol i a-characteristics/) February 28, 2019 View (https:Uwww.texasclass.com/february-2 019-portfol io-characteristics/) January 31, 2019 View (https :Uwww.texasclass.com/j anuary -2019-portfol io -cha racteristics/) December 31, 2018 View (https:Uwww.texasclass.com/ decem ber-2018-p ortfol io-characteristics/) https://www.texasclass.com/june-20 19-portfolio-characteristics/ 7/26/2019 June 2019 Portfolio Characteri sti cs -Texas C LASS Pa ge 13of13 Data unaudited. Charts may not equal 100% due to rounding. Performance results for Texas CLASS are shown net of all fees and expenses and reflect the reinvestment of dividends and other earnings. Many factors affect performance including changes in market conditions and interest rates and in response to other economic, political , or financial developments. Investment involves risk including the possible loss of principal. No assurance can be given that the performance objectives of a given strategy will be achieved. All comments and discussion presented are purely based on opinion and assumptions, not fact. These assumptions may or may not be correct based on foreseen and unforeseen events. The information presented should not be used in making any investment decisions. This material is not a recommendation to buy, sell , implement, or change any securities or investment strategy, function, or process. Any financial and/or investment decision should be made only after considerable research , consideration, and involvement with an experienced professional engaged for the specific purpose. Past performance is not an indication of future performance. Any financial and/or investment decision may incur losses. A 'AAAm' rating by S&P Global Ratings is obtained after S&P evaluates a number of factors including credit quality, market price exposure, and management. Rati ngs are subject to change and do not remove credit risk. *The benchmark, the S&P US AAA &AA Rated GIP All 30 Day Net Yield (LGIP30D) is a performance indicator of rated GIPs that maintain a stable net asset value of $1.00 per share and is an unmanaged market index representative of the LGIP universe. The S&P benchmark utilized in this comparison is a composite of all rated stable net asset value pools. GIPs in the index include only those rated based on S&P's money market criteria. Pools rated 'AAAm' provide excellent safety and a superior capacity to maintain principal value while those rated 'AAm' offer very good safety and a strong capacity to maintain principal value (Source : S&P Global Ratings' website). The comparison between this index and the portfolio may differ in hold i ngs, duration, fees , and percentage composition of each holding. Such differences may account for variances in yield. *The benchmark, the S&P AAA & AA Rated GIP Govt 30 Day Net Yield (LGIPG30N) is a performance indicator of rated GIPs that maintain a stable net asset value of $1.00 per share and is an unmanaged market index representative of the LGIP universe. The S&P benchmark utilized in this comparison is comprised of pools that invest in U.S. Government securities, U.S. Treasury securities, Repurchase agreements collateralized by U.S. government and treasury securities or any combination of the above. GIPs in the i ndex include only those rated based on S&P's money market cri teria. Pools rated 'AAAm' provide excellent safety and a superi or capacity to maintain principal value while those rated 'AAm' offer very good safety and a strong capacity to maintain principal value (Source: S&P Global Ratings ' website). The comparison between this index and the portfolio may differ in holdi ngs, duration, fees, and percentage composition of each holding. Such differences may account for variances in yield . Calculation methodology for the LGIP30D a nd LGIPG30N is the monthly av erage of the each week's seven day average rate as provided by Bloomberg. http s ://www. texasclass .co rn/june -2 01 9 -p ortfo I io-c haracte ri sti cs/ 7/2 6/201 9 (continued page 6) ANNOUNCEMENTS Economic and Market Commentary: Investors shouldn’t go looking for trouble June 1, 2019 As you learn in Economics 101, fi nancial markets tend to act irrationally. Of course, the emphasis is on high-fl ying equities, not the grounded Treasury market. But lately, you can make a strong case that investors at the short end of the yield curve are not using common sense. In May the yield curve fl attened, briefl y twisted (3-month and 1-year Treasury yields dipping below 1-month) and then fl attened again, but with the 1-year lower. These days, it appears that the 1-year is joining the larger inversion out the curve. Perhaps irrational is too strong a word, but recent investor behavior is—to use fi nancial jargon instead of academic textbooks—overdone. The fl attener is simply not justifi ed by the domestic economic data that, while moderating, is still strong. We are among the many who think the U.S. is not likely headed to a recession anytime soon. While signifi cant, all of the geopolitical issues circling, such as trade confl icts, central bank easing and Brexit, hardly justify this overreaction. Nor does the likelihood of the Federal Reserve being on hold for the remainder of 2019. The issue seems to be a case of investing via group think. But some investors may be overthinking. One of the reasons for the recent fl attening is a misread, in our view, of a very technical maneuver by the Fed that investors shouldn’t TexPool Participant Services Managed and 1001 Texas Avenue, Suite 1400 ●Houston, TX 77002 Serviced by ee eratdd Phone: 1-866-TEXPOOL (839-7665) ●Fax: 1-866-839-3291 ●TexPool.com G35884-24 (6/19) We welcome the following entities who joined TexPool in May 2019: TexPool Montgomery County MUD 137 Bastrop County WCID 2 Belvedere MUD Lakeside WCID 2A Lakeside WCID 2B Lakeside WCID 2C Lakeside WCID 2D West Williamson County MUD 2 TexPool Prime Dripping Springs Community Library Johnson County Montgomery County MUD 60 International Leadership of Texas Montgomery County MUD 6 Montgomery County MUD 7 Montgomery County MUD 36 Montgomery County MUD 39 Montgomery County MUD 46 Montgomery County MUD 47 Montgomery County MUD 67 The Woodlands MUD 1 Upcoming Events Jun 13, 2019 - Jun 15, 2019 Fort Worth Convention Center, Fort Worth AWBD Annual Conference Jun 17, 2019 - Jun 19, 2019, Allen TASBO Summer Conference Jun 17, 2019 - Jun 21, 2019, San Antonio TACCBO Annual Meeting and Conference Jul 07, 2019 - Jun 09, 2019, San Antonio TASSCUBO Summer Conference TexPool Advisory Board Members David Garcia Jerry Dale Patrick Krishock David Landeros Belinda Weaver Sharon Matthews Deborah Laudermilk Vivian Wood Overseen by the State of Texas Comptroller of Public Accounts Glenn Hegar. Operated under the supervision of the Texas Treasury Safekeeping Trust Company Monthly Newsletter: June 2019 Performance as of May 31, 2019 TexPool TexPool Prime Current Invested Balance $21,351,858,377.08 $6,845,429,589.36 Weighted Average Maturity** 38 43 Weighted Average Life** 103 68 Net Asset Value 1.00008 1.00008 Total Number of Participants 2564 393 Management Fee on Invested Balance 0.0450% 0.0550% Interest Distributed $44,863,334.27 $14,949,539.69 Management Fee Collected $779,871.22 $290,681.83 Standard & Poor's Current Rating AAAm AAAm Month Averages Average Invested Balance $22,024,057,945.01 $6,911,896,658.31 Average Monthly Rate* 2.40% 2.55% Average Weighted Average Maturity** 35 45 Average Weighted Average Life** 97 68 *This average monthly rate for TexPool Prime for each date may refl ect a waiver of some portion or all of each of the management fees. **See page 2 for defi nitions. Past performance is no guarantee of future results. Pg: 2 Portfolio by Maturity (%) As of May 31, 2019 ■ 1-7 days 60.1 ■ 8-30 days 11.7 ■ 31-90 days 15.1 ■ 91-180 days 8.6 ■ 181+ days 4.5 Portfolio by Type of Investment (%) As of May 31, 2019 ■ Repurchase Agreements 44.2 ■ Agencies 42.1 ■ Treasurys 10.3 ■ Money Market Funds 3.4 Portfolio Asset Summary as of May 31, 2019 Book Value Market Value Uninvested Balance 1,080,301.72 1,080,301.72 Receivable for Investments Sold 0.00 0.00 Accrual of Interest Income 20,924,149.85 20,924,149.85 Interest and Management Fees Payable -44,863,403.71 -44,863,403.71 Payable for Investments Purchased -150,000,000.00 -150,000,000.00 Accrued Expenses & Taxes -24,451.01 -24,451.01 Repurchase Agreements 9,523,560,000.00 9,523,560,000.00 Mutual Fund Investments 736,074,000.00 736,074,000.00 Government Securities 9,050,304,612.13 9,050,932,869.72 U.S. Treasury Infl ation Protected Securities 1,194,960,743.91 1,195,396,736.30 US Treasury Bills 539,334,585.79 539,787,890.01 US Treasury Notes 480,507,838.40 480,706,122.73 Total $21,351,858,377.08 $21,353,574,215.60 Market value of collateral supporting the Repurchase Agreements is at least 102% of the Book Value. The portfolio is managed by Federated Investment Counseling and the assets are safe kept in a separate custodial account at State Street Bank in the name of TexPool. The only source of payment to the Participants is the assets of TexPool. There is no secondary source of payment for the pool such as insurance or State guarantee. Should you require a copy of the portfolio, please contact TexPool Participant Services. Participant Summary Number of Participants Balance School District 595 $7,268,520,589.15 Higher Education 59 $919,884,368.06 Healthcare 84 $871,955,600.70 Utility District 819 $3,008,038,824.57 City 471 $4,872,404,873.37 County 186 $2,299,690,780.26 Other 350 $2,109,511,566.99 **Defi nition of Weighted Average Maturity and Weighted Average Life WAM is the mean average of the periods of time remaining until the securities held in TexPool (a) are scheduled to be repaid, (b) would be repaid upon a demand by TexPool, or (c) are scheduled to have their interest rate readjusted to refl ect current market rates. Securities with adjustable rates payable upon demand are treated as maturing on the earlier of the two dates set forth in (b) and (c) if their scheduled maturity is 397 days or less; and the later of the two dates set forth in (b) and (c) if their scheduled maturity is more than 397 days. The mean is weighted based on the percentage of the amortized cost of the portfolio invested in each period. WAL is calculated in the same manner as WAM, but is based solely on the periods of time remaining until the securities held in TexPool (a) are scheduled to be repaid or (b) would be repaid upon a demand by TexPool, without reference to when interest rates of securities within TexPool are scheduled to be readjusted. Monthly Newsletter: June 2019 Pg: 3 Daily Summary Date Money Mkt. Fund Equiv. (SEC Std.) Dividend Factor TexPool Invested Balance NAV WAM Days WAL Days 5/1 2.4671% 0.000067592 $22,524,980,475.42 0.99998 34 95 5/2 2.4410% 0.000066877 $22,523,987,241.99 1.00000 34 95 5/3 2.4198% 0.000066297 $22,441,848,617.30 1.00000 34 96 5/4 2.4198% 0.000066297 $22,441,848,617.30 1.00000 34 96 5/5 2.4198% 0.000066297 $22,441,848,617.30 1.00000 34 96 5/6 2.4062% 0.000065922 $22,408,059,440.18 1.00001 32 94 5/7 2.4118% 0.000066076 $22,364,212,471.34 1.00001 34 95 5/8 2.4098% 0.000066021 $22,313,769,468.39 1.00001 35 96 5/9 2.4009% 0.000065779 $22,263,198,443.85 1.00001 35 96 5/10 2.3913% 0.000065515 $22,390,571,361.41 1.00001 35 95 5/11 2.3913% 0.000065515 $22,390,571,361.41 1.00001 35 95 5/12 2.3913% 0.000065515 $22,390,571,361.41 1.00001 35 95 5/13 2.3832% 0.000065293 $22,349,784,859.31 1.00002 33 95 5/14 2.3836% 0.000065305 $22,227,508,418.14 1.00002 34 96 5/15 2.4173% 0.000066227 $22,005,010,767.34 1.00002 34 96 5/16 2.4097% 0.000066019 $21,918,027,883.87 1.00002 34 97 5/17 2.4024% 0.000065820 $21,879,849,169.92 1.00003 35 97 5/18 2.4024% 0.000065820 $21,879,849,169.92 1.00003 35 97 5/19 2.4024% 0.000065820 $21,879,849,169.92 1.00003 35 97 5/20 2.3841% 0.000065318 $21,797,419,009.88 1.00003 33 95 5/21 2.3827% 0.000065279 $21,812,280,996.46 1.00003 36 96 5/22 2.3780% 0.000065150 $21,707,500,540.91 1.00003 37 98 5/23 2.3761% 0.000065098 $21,649,789,857.12 1.00005 37 98 5/24 2.3757% 0.000065088 $21,714,472,886.34 1.00004 37 97 5/25 2.3757% 0.000065088 $21,714,472,886.34 1.00004 37 97 5/26 2.3757% 0.000065088 $21,714,472,886.34 1.00004 37 97 5/27 2.3757% 0.000065088 $21,714,472,886.34 1.00004 37 97 5/28 2.3898% 0.000065474 $21,603,586,878.94 1.00004 37 97 5/29 2.3962% 0.000065650 $21,517,311,104.99 1.00005 37 100 5/30 2.4005% 0.000065766 $21,412,811,068.88 1.00004 37 100 5/31 2.4334% 0.000066669 $21,351,858,377.08 1.00008 38 103 Average: 2.4005% 0.000065767 $22,024,057,945.01 1.00002 35 97 Pg: 4 TEXPOOL PRIME Monthly Newsletter: June 2019 Portfolio by Maturity (%) As of May 31, 2019 ■ 1-7 days 47.7 ■ 8-30 days 20.3 ■ 31-90 days 8.8 ■ 91-180 days 19.1 ■ 181+ days 4.1 Portfolio by Type of Investment (%) As of May 31, 2019 ■ Commercial Paper 44.3 ■ Variable Rate Notes 23.8 ■ Repurchase Agreements 23.7 ■ Money Market Funds 8.2 Portfolio Asset Summary as of May 31, 2019 Book Value Market Value Uninvested Balance 1,746.52 1,746.52 Receivable for Investments Sold 0.00 0.00 Accrual of Interest Income 4,317,606.27 4,317,606.27 Interest and Management Fees Payable -14,949,541.77 -14,949,541.77 Payable for Investments Purchased -114,714,166.66 -114,714,166.66 Accrued Expenses & Taxes -9,273.70 -9,273.70 Repurchase Agreements 1,650,440,000.00 1,650,440,000.00 Commercial Paper 3,085,717,208.88 3,085,955,007.30 Bank Instruments 0.00 0.00 Mutual Fund Investments 572,127,190.50 572,052,003.75 Government Securities 0.00 0.00 Variable Rate Notes 1,662,498,819.32 1,662,867,500.80 Total $6,845,429,589.36 $6,845,960,882.51 Market value of collateral supporting the Repurchase Agreements is at least 102% of the Book Value. The portfolio is managed by Federated Investment Counseling and the assets are safe kept in a separate custodial account at State Street Bank in the name of TexPool Prime. The assets of TexPool Prime are the only source of payments to the Participants. There is no secondary source of payment for the pool such as insurance or State guarantee. Should you require a copy of the portfolio, please contact TexPool Participant Services Participant Summary Number of Participants Balance School District 124 $2,883,117,423.03 Higher Education 18 $641,853,630.51 Healthcare 16 $405,413,614.82 Utility District 44 $331,317,210.19 City 77 $1,099,982,804.17 County 40 $612,984,480.95 Other 74 $870,715,302.72 Pg: 5 TEXPOOL PRIME Daily Summary Date Money Mkt. Fund Equiv. (SEC Std.) Dividend Factor TexPool Prime Invested Balance NAV WAM Days WAL Days 5/1 2.6164% 0.000071682 $6,937,101,400.82 1.00006 42 62 5/2 2.5851% 0.000070825 $6,913,740,117.58 1.00006 44 64 5/3 2.5719% 0.000070464 $6,926,594,107.44 1.00000 44 65 5/4 2.5719% 0.000070464 $6,926,594,107.44 1.00000 44 65 5/5 2.5719% 0.000070464 $6,926,594,107.44 1.00000 44 65 5/6 2.5628% 0.000070213 $6,891,360,657.47 1.00005 43 64 5/7 2.5680% 0.000070356 $6,920,416,517.85 1.00005 42 63 5/8 2.5607% 0.000070156 $6,927,240,653.97 1.00005 42 62 5/9 2.5554% 0.000070011 $6,937,392,460.05 1.00006 43 66 5/10 2.5485% 0.000069823 $7,054,257,203.08 0.99999 46 68 5/11 2.5485% 0.000069823 $7,054,257,203.08 0.99999 46 68 5/12 2.5485% 0.000069823 $7,054,257,203.08 0.99999 46 68 5/13 2.5437% 0.000069691 $7,064,985,926.76 1.00005 48 71 5/14 2.5452% 0.000069732 $6,979,327,239.35 1.00006 48 71 5/15 2.5667% 0.000070321 $6,872,975,318.67 1.00006 48 72 5/16 2.5574% 0.000070067 $6,841,568,686.61 1.00006 48 71 5/17 2.5538% 0.000069966 $6,791,764,276.98 1.00000 48 72 5/18 2.5538% 0.000069966 $6,791,764,276.98 1.00000 48 72 5/19 2.5538% 0.000069966 $6,791,764,276.98 1.00000 48 72 5/20 2.5364% 0.000069490 $6,794,706,726.94 1.00007 46 70 5/21 2.5379% 0.000069532 $6,821,330,260.93 1.00007 45 69 5/22 2.5474% 0.000069792 $6,775,788,830.97 1.00008 45 69 5/23 2.5124% 0.000068833 $6,874,784,601.36 1.00009 44 67 5/24 2.4936% 0.000068319 $6,945,312,493.11 0.99999 44 67 5/25 2.4936% 0.000068319 $6,945,312,493.11 0.99999 44 67 5/26 2.4936% 0.000068319 $6,945,312,493.11 0.99999 44 67 5/27 2.4936% 0.000068319 $6,945,312,493.11 0.99999 44 67 5/28 2.5205% 0.000069055 $6,932,409,637.19 1.00008 42 64 5/29 2.5379% 0.000069531 $6,903,499,021.63 1.00009 43 67 5/30 2.5374% 0.000069517 $6,935,642,025.13 1.00009 42 67 5/31 2.5620% 0.000070193 $6,845,429,589.36 1.00008 43 68 Average: 2.5468% 0.000069775 $6,911,896,658.31 1.00004 45 68 be tracking anyway: interest on excessive reserves (IOER). The story goes like this: by cutting the interest the Fed pays banks on the money they keep in their Fed accounts, policymakers have surreptitiously lowered rates. Hmmm. People seem to have forgotten that the Fed has lowered IOER twice within the last six months without any market consternation. The only diff erence is that they were raising the fed funds target rate at the time. With rates on hold, the market seems to be perceiving the reduction as a proxy for a rate cut— the easing that so many have already forecast. But the fact is that the Fed tightened IOER to give it more control over monetary policy from a federal funds perspective, and also to incentivize banks to move funds into the marketplace. It isn’t easing. The good news for cash managers is that liquidity products remain attractive in this environment—especially prime portfolios that use the London interbank off ered rate (Libor) that has not inverted—compared to Treasuries and bank deposits, whose rates are falling and weren’t great to begin. One-, 3- and 6-month Treasuries all ended May at 2.3%. London interbank off ered rates (Libor) fi nished the month at 2.43%, 2.50% and 2.52%, respectively. The weighted average maturity (WAM) at month-end was 38 days for TexPool and 43 days for TexPool Prime. Participant Services 1001 Texas Ave. 14th Floor Houston, TX 77002 90-Day Treasury Bill is a short-term debt instrument backed by the national government. These are used to collect immediate cash to meet outstanding obligations. Any private investor can invest in a Treasury bill. The 90-Day Treasury Bill is a weighted average rate of the weekly auctions of 90-Day Treasury Bills. Past performance is no guarantee of future results. TexPool Prime Rate TexPool & TexPool Prime vs. 90-Day Treasury Bill 90-Day T-Bill Rate TexPool Rate 2.1% 2.2% 2.3% 2.4% 2.5% 2.6% 2.7% 2.8% 5/315/154/304/153/313/15 ECONOMIC HIGHLIGHTS Federal Reserve Bank of Dallas Dallas-Fort Worth Economic Indicators | June 25, 2019 Page 1 of 4 Federal Reserve Bank of Dallas Dallas-Fort Worth Economic Indicators | June 25, 2019 Page 2 of 4 Federal Reserve Bank of Dallas Dallas-Fort Worth Economic Indicators | June 25, 2019 Page 3 of 4 Federal Reserve Bank of Dallas Dallas-Fort Worth Economic Indicators | June 25, 2019 Page 4 of 4 Federal Reserve Bank of Dallas Texas Economic Indicators | June 25, 2019 Page 1 of 4 Federal Reserve Bank of Dallas Texas Economic Indicators | June 25, 2019 Page 2 of 4 Federal Reserve Bank of Dallas Texas Economic Indicators | June 25, 2019 Page 3 of 4 Federal Reserve Bank of Dallas Texas Economic Indicators | June 25, 2019 Page 4 of 4