HomeMy WebLinkAboutBUDGET & FINANCE AGENDA 06-02-08
Central Contra Costa Sanitary District
5019 Imhoff Place, Maltlllez, CA 94553-4392 (925) 228-9500 . wwwcentralsan,org
BUDGET AND FINANCE COMMITTEE
Chair McGill
Member Nejedly
Monday, June 2, 2008
3:00 p.m.
Executive Conference Room
5019 Imhoff Place
Martinez, California
1. CALL MEETING TO ORDER
2. PUBLIC COMMENTS
3. OLD BUSINESS
4. CLAIMS MANAGEMENT
a. Discuss May 20,2008 meeting with homeowner McBride at 79 Lorna
Vista, Orinda.
5. REPORTS/ANNOUNCEMENTS
a. Review and consider recommending Position Paper on conducting public
hearings to establish the Sewer Service Charge rate for 2008-09 and
approving the FY 2008-09 O&M, Debt Service, and Self-Insurance
Budgets. (Item 5.b. in Board Binder)
b. Review and consider recommending Position Paper regarding the annual
renewal of the District's insurance policies. (Item 4.s. in Board Binder)
*c. Receive draft GASB 45 Trust Investment Policies that will be reviewed in
detail at the June 16, 2008 Committee meeting.
*d. Review of draft Position Paper and Policy on Board Conference and
Meeting Attendance.
6. REVIEW FINANCIAL STATEMENTS
a. Review April 2008 Financial Statements (Item 4.b. in Board Binder)
A
", Recycled Paper
S.c.
Central Contra Costa Sanitary District
June 2, 2008
FROM:
BUDGET AND FINANCE COMMITTEE
JAMES M. KELLY, GENERAL MANAGER fAZ-
RANDALL M. MUSGRAVES, DIRECTOR OF ADMINISTRATION ~i^
DEBBIE RATCLIFF, CONTROLLER /fJ~
TO:
VIA:
SUBJECT:
OPTIONS FOR GASB 45 TRUST FUND INVESTMENTS
At the May 12, 2008 Budget and Finance Committee meeting, staff was directed to work
with Mr. Andrew Brown of HighMark Capital Investment Group (associated with PARS)
to develop investment policies for a moderate and moderate aggressive investment
strategy. Attached are the draft policies for your review. In addition, there are three
basic investment strategy options to consider (see below). They range from
conservative (security) to aggressive (yield). In addition, the transfer of funds to the
trust can be altered to allow more time to evaluate the return on investment. Due to the
volatility of stocks and the stock market, staff would like to review the options with the
Committee at the June 2, 2008 Committee meeting.
Investment Implementation
The Board could invest the funds set aside for GASB 45 over time on all at once.
For example, the District could Place $2,000,000 every other month (or $1,000,000 per
month) from LAIF into
the GASB 45 Trust. This would provide approximately ten months to transfer the
full amount and allow additional time to monitor the stock market. The amount
and frequency can be altered by the performance of the stock market. Or, the
Committee could recommend to place the full $10,000,000 into the trust upon
creation.
Option 1 - Conservative
Place funds into the conservative investments as defined by HighMark
Capital Management Group. The funds can be moved to any investment
strategy within three working days.
Option 2 - Moderate
Place funds into moderate investments as defined by HighMark
Capital Management Group. The funds can be moved to any investment
strategy within three working days.
Option 3 - Moderate Aggressive
Place funds into moderate aggressive investments as defined by
HighMark Capital Management Group. The funds can be moved to any
Investment strategy within three working days.
Central Contra Costa Sanitary District
May 30,2008
TO: BUDGET AND FINANCE COMMITTEE
VIA:
JAMES KELLY, GENERAL MANAGER r k::-
DEBBIE RATCLIFF ,t7;e
RANDALL MUSGRAVES {(/HI/\.
SUBJECT: GASB 45 TRUST INVESTMENT POLICY
FROM:
At the May 12, 2008 Budget and Finance Committee meeting, Andrew Brown,
Investment Advisor with HighMark Capital, presented various investment strategies for
the District to consider for monies that will be deposited into a GASB 45 trust. Four
investment strategies were discussed: conservative, moderately conservative,
moderate, and moderately aggressive. The Committee asked that an investment
guideline document be drafted for both the moderate and moderately aggressive
strategy and brought back for Committee review.
An investment guideline document for each of the two strategies is attached. Behind
each guideline document is a sample portfolio of potential investments. Also attached
are a copy of the District's current investment policy, a list of investments for LAIF as of
April 2008, and a list of permitted asset classes and security types that are approved by
HighMark for use in client portfolios. The yellow highlights on that list signify
investments that are common to LAIF as well. All the others are additional investment
vehicles.
The attached documents will be reviewed in detail at the June 16, 2008 Budget and
Finance Committee meeting and are being distributed early to allow time for Committee
review. After the Committee review is completed, staff has been asked to schedule a
special workshop with the full Board to discuss the two investment strategies and to
provide staff with direction.
H:\GASB 45 Investment Guidelines.doc
INVESTMENT GUIDELINES DOCUMENT
Central Contra Costa Sanitary District
Central Contra Costa Sanitary District Investment Guidelines May 2008
1
Central Contra Costa Sanitary District
Investment Guidelines Document
In response to the Government Accounting Standards Board (GASB) Statement Number 45
disclosure requirements for Other Post-Employment Benefit (OPEB) Plans, the Central Contra Costa
Sanitary District has adopted a Section 115 Trust and Plan that seeks to satisfy these liabilities for
certain eligible employees
Executive Summary
Client Name:
Central Contra Costa Sanitary District
Investment Authority: Full Investment Authority
Account Number(s): To be determined
Current Assets: $ 10 million (est. May 2008)
Risk Tolerance: Moderate Objective
Time Horizon: Long-Term
Investment Objective: The primary objective is to maximize total Plan return,
subject to the risk and quality constraints set forth below. The Plan's targeted rate of
return is 7.0%. The Investment objective the District has selected is the Moderate
Objective. The asset allocation ranges for this objective are listed below:
Strategic Ranges:
o - 20% Cash
40 - 60% Fixed Income
40 - 60% Equity
Communication Schedule:
Committee meetings quarterly. Monthly statements.
HCM Portfolio Manager:
Andrew Brown, CFA 415-705-7605
Andrew. Brown@Uboc.com
HCM Back up -Portfolio Manager:
Delbert Chang CFA 415-705-7603
Delbert. Chana@Uboc.com
UBOC Administrative Officer:
John Fulton, 415-273-2508
John.Fulton@Uboc.com
The managing director for HighMark Capital Management is Kevin Rogers, he can be reached at 949-553-2580
Central Contra Costa Sanitary District
Investment Guidelines
May 2008
2
Portfolio Constraints
Income Needs/Cash Flow Required: Annual cost estimated to be at $2.2 million.
Unique Needs and Circumstances: None
Client(s) Signature: Date:
HCM Portfolio Manager: Date:
UBOC Administrative Officer: Date:
Detailed Information for
Central Contra Costa Sanitary District
Investment Guidelines
May 2008
3
Investment Guidelines Document
Overview
The purpose of this Investment Guidelines document (/GD) is to assist you and your Portfolio
Manager in effectively supervising, monitoring and evaluating the investment of your portfolio.
Your investment program is defined in the various sections of the IGD by:
1. Stating in a written document your attitudes, expectations, objectives and guidelines for
the investment of all assets.
2. Setting forth an investment structure for managing your portfolio. This structure includes
various asset classes, investment management styles, asset allocation and acceptable
ranges that, in total, are expected to produce an appropriate level of overall diversification
and total investment return over the investment time horizon.
3. Encouraging effective communications between you and your Portfolio Manager.
4. Complying with all applicable fiduciary, prudence and due diligence requirements
experienced investment professionals would utilize, and with all applicable laws, rules
and regulations from various local, state, and federal entities that may impact your assets
Diversification
Your Portfolio Manager is responsible for maintaining the balance between fixed income and
equity securities based on the asset allocation. The following parameters shall be adhered to in
managing the portfolio:
Fixed Income
· The long-term fixed income investments (greater than seven-years in maturity)
shall constitute no more than 25%, and as little as 0% of the total Plan assets.
· The intermediate-term fixed income investments (between three-seven years in
maturity) shall constitute no more than 60%, nor less than 25% of the total Plan
assets.
· The high-yield portion of the Plan shall constitute no more than 10%, and as little
as 0% of the total Plan assets.
· The convertible bond exposure shall constitute no more than 10%, and as little as
0% of the total Plan assets.
· The short-term fixed income investments (between one-three years in maturity)
shall constitute no more than 25%, and as little as 0% of the total Plan assets.
Equity
· The domestic large cap equity investments of the Plan shall constitute no more
than 45% nor less than 15% of the total Plan assets.
· The domestic mid-capitalization equity investments of the Plan shall constitute no
more than 10%, and as little as 0% of the total Plan assets.
· The domestic small capitalization equity investments of the Plan shall constitute no
more than 15% nor less than 0% of the total Plan assets.
· The international equity investments of the Plan shall constitute no more than 15%
and as little as 0% of the total Plan assets.
Central Contra Costa Sanitary District
Investment Guidelines
May 2008
4
· The real estate investments of the Plan shall constitute no more than 10% and as
little as 0% of the total Plan assets.
Permitted Asset Classes and Security Tvpes
The following asset classes and security types have been approved by HighMark for use in client
portfolios:
Asset Classes
· Fixed Income
o Domestic Bonds
o Non-U.S. Bonds
. Equities
o Domestic
o Non-U.S.
o Emerging Markets
o Real Estate Investment Trust (REITs)
· Cash and Cash Equivalents
Security Types
· Equity Securities
o Domestic listed and unlisted securities
o Equity and equity-related securities of non~US corporations, in the form of
American Depository Receipts ("ADRs")
. Equity Mutual Funds
o Large Cap Growth and Value
o Mid Cap Core
o Small Cap Growth and Value
o International and Emerging Markets
o REITs
· Exchange Traded Funds (ETFs)
. Fixed Income Securities
o Government/Agencies
o Mortgage Backed Bonds
o Corporate Bonds and Notes
· Fixed Income Mutual Funds
o Corporate
o Government
o High Yield
o International and Emerging Market
o Convertible
o Preferred
. Closed end funds
· Cash and Cash Equivalents
o Money Market Mutual Fund
o Commercial Paper
o CDs and Bankers Acceptance
Prohibited assets
· Precious metals
· Venture Capital
· Short sales
Central Contra Costa Sanitary District
Investment Guidelines
May 2008
5
· Purchases of Letter Stock, Private Placements, or direct payments
· Leveraged Transactions
· Commodities Transactions Puts, calls, straddles, or other option strategies,
· Purchases of real estate, with the exception of REITs
· Derivatives, with exception of ETFs
Rebalancina Procedures
From time to time, market conditions may cause your asset allocation to vary from the
established target. To remain consistent with the asset allocation guidelines established by this
Investment Guidelines document, your Portfolio Manager will rebalance the portfolio on a
quarterly basis.
Duties of Responsibilities of Portfolio Manaaer
Your portfolio manager is expected to manage your portfolio in a manner consistent with this
Investment Guidelines document and in accordance with State and Federal law and the Uniform
Prudent Investor Act. HighMark Capital Management is a registered investment advisor and shall
act as such until you decide otherwise.
Your portfolio manager shall be responsible for:
1. Designing, recommending and implementing an appropriate asset allocation
consistent with the investment objectives, time horizon, risk profile, guidelines and
constraints outlined in this statement.
2. Advising the committee about the selection of and the allocation of asset categories.
3. Identifying specific assets and investment managers within each asset category.
4. Monitoring the performance of all selected assets.
5. Recommending changes to any of the above.
6. Periodically reviewing the suitability of the investments, being available to meet with
the committee at least once each year, and being available at such other times within
reason at your request.
7. Preparing and presenting appropriate reports.
8. Informing the committee if changes occur in personnel that are responsible for
portfolio management or research.
You shall be responsible for:
1. The oversight of the investment portfolio.
2. Providing your portfolio manager with all relevant information on the Plan, and shall
notify him or her promptly of any changes to this information.
3. Advising your portfolio manager of any change in the Plan's circumstances, such as
a change in the actuarial assumptions, which could possibly necessitate a change to
your overall risk tolerance, time horizon or liquidity requirements; and thus would
dictate a change to your overall investment objective and goals for the portfolio.
4. Monitoring performance by means of regular reviews to assure that objectives are
being met and that the policy and guidelines are being followed.
Communication
As a matter of course, your portfolio manager shall keep you apprised of any material changes in
HighMark Capital's outlook, recommended investment policy and tactics. In addition, your
Central Contra Costa Sanitary District
Investment Guidelines
May 2008
6
,......~..__"__..______..______~_...__.,_.,_."",._.___.___,._,__,._.____........~.._u
portfolio manager shall meet with you no less than annually to review and explain the portfolio's
investment results and any related issues. Your portfolio manager shall also be available on a
reasonable basis for telephone communication when needed.
Any material event that affects the ownership of HighMark Capital Management or the
management of the portfolio must be reported immediately to you.
Disclosures
Union Bank of California, N.A. and HighMark Capital Management, Inc. are wholly owned
subsidiaries of UnionBanCal Corporation. Investments are not deposits or bank obligations, are
not guaranteed by any government agency, and involve risk, including loss of principal.
Central Contra Costa Sanitary District
Investment Guidelines
May 2008
7
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INVESTMENT GUIDELINES DOCUMENT
Central Contra Costa Sanitary District
Central Contra Costa Sanitary District Investment Guidelines May 2008
1
Central Contra Costa Sanitary District
Investment Guidelines Document
In response to the Government Accounting Standards Board (GASB) Statement Number 45
disclosure requirements for Other Post-Employment Benefit (OPEB) Plans, the Central Contra Costa
Sanitary District has adopted a Section 115 Trust and Plan that seeks to satisfy these liabilities for
certain eligible employees
Executive Summary
Client Name:
Central Contra Costa Sanitary District
Investment Authority: Full Investment Authority
Account Number(s): To be determined
Current Assets: $ 10 million (est. May 2008)
Risk Tolerance: Moderately Aggressive Objective
Time Horizon: Long-Term
Investment Objective: The primary objective is to maximize total Plan return,
subject to the risk and quality constraints set forth below. The Plan's targeted rate of
return is 8.0%. The Investment objective the District has selected is the Moderately
Aggressive Objective. The asset allocation ranges for this objective are listed below:
Strategic Ranges:
o - 20% Cash
30 - 50% Fixed Income
50 - 70% Equity
Communication Schedule:
Committee meetings quarterly. Monthly statements.
HCM Portfolio Manager:
Andrew Brown, CFA 415-705-7605
Andrew. BrownCCUUboe.eom
HCM Back up -Portfolio Manager:
Delbert Chang CFA 415-705-7603
Delbert. ChanqCCUU boe.eom
UBOC Administrative Officer:
John Fulton, 415-273-2508
John. FultonCCUU boc.eom
The managing director for HighMark Capital Management is Kevin Rogers, he can be reached at 949-553-2580
Central Contra Costa Sanitary District
Investment Guidelines
May 2008
2
Portfolio Constraints
Income Needs/Cash Flow Required: Annual cost estimated to be at $2.2 million.
Unique Needs and Circumstances: None
Client(s) Signature: Date:
HCM Portfolio Manager: Date:
UBOC Administrative Officer: Date:
Central Contra Costa Sanitary District
Investment Guidelines
May 2008
3
Detailed Information for
Investment Guidelines Document
Overview
The purpose of this Investment Guidelines document (IGD) is to assist you and your Portfolio
Manager in effectively supervising, monitoring and evaluating the investment of your portfolio.
Your investment program is defined in the various sections of the IGD by:
1. Stating in a written document your attitudes, expectations, objectives and guidelines for
the investment of all assets.
2. Setting forth an investment structure for managing your portfolio. This structure includes
various asset classes, investment management styles, asset allocation and acceptable
ranges that, in total, are expected to produce an appropriate level of overall diversification
and total investment return over the investment time horizon.
3. Encouraging effective communications between you and your Portfolio Manager.
4. Complying with all applicable fiduciary, prudence and due diligence requirements
experienced investment professionals would utilize, and with all applicable laws, rules
and regulations from various local, state, and federal entities that may impact your assets
Diversification
Your Portfolio Manager is responsible for maintaining the balance between fixed income and
equity securities based on the asset allocation. The following parameters shall be adhered to in
managing the portfolio:
Fixed Income
· The long-term fixed income investments (greater than seven-years in maturity)
shall constitute no more than 20%, and as little as 0% of the total Plan assets.
· The intermediate-term fixed income investments (between three-seven years in
maturity) shall constitute no more than 50%, nor less than 15% of the total Plan
assets.
· The high-yield portion of the Plan shall constitute no more than 10%, and as little
as 0% of the total Plan assets.
· The convertible bond exposure shall constitute no more than 10%, and as little as
0% of the total Plan assets.
· The short-term fixed income investments (between one-three years in maturity)
shall constitute no more than 20%, and as little as 0% of the total Plan assets.
Equity
· The domestic large cap equity investments of the Plan shall constitute no more
than 50% nor less than 30% of the total Plan assets.
· The domestic mid-capitalization equity investments of the Plan shall constitute no
more than 15%, and as little as 0% of the total Plan assets.
Central Contra Costa Sanitary District
Investment Guidelines
May 2008
4
· The domestic small capitalization equity investments of the Plan shall constitute no
more than 20% nor less than 0% of the total Plan assets.
· The international equity investments of the Plan shall constitute no more than 20%
and as little as 0% of the total Plan assets.
· The real estate investments of the Plan shall constitute no more than 10% and as
little as 0% of the total Plan assets.
Permitted Asset Classes and Security TVDes
The following asset classes and security types have been approved by HighMark for use in client
portfolios:
Asset Classes
· Fixed Income
o Domestic Bonds
o Non-U.S. Bonds
. Equities
o Domestic
o Non-U.S.
o Emerging Markets
o Real Estate Investment Trust (REITs)
· Cash and Cash Equivalents
Security Types
· Equity Securities
o Domestic listed and unlisted securities
o Equity and equity-related securities of non-US corporations, in the form of
American Depository Receipts ("ADRs")
· Equity Mutual Funds
o Large Cap Growth and Value
o Mid Cap Core
o Small Cap Growth and Value
o International and Emerging Markets
o REITs
· Exchange Traded Funds (ETFs)
· Fixed Income Securities
o GovernmenVAgencies
o Mortgage Backed Bonds
o Corporate Bonds and Notes
· Fixed Income Mutual Funds
o Corporate
o Government
o High Yield
o International and Emerging Market
o Convertible
o Preferred
· Closed end funds
· Cash and Cash Equivalents
o Money Market Mutual Fund
o Commercial Paper
o CDs and Bankers Acceptance
Central Contra Costa Sanitary District
Investment Guidelines
May 2008
5
Prohibited assets
· Precious metals
· Venture Capital
· Short sales
· Purchases of Letter Stock, Private Placements, or direct payments
· Leveraged Transactions
· Commodities Transactions Puts, calls, straddles, or other option strategies,
· Purchases of real estate, with the exception of REITs
· Derivatives, with exception of ETFs
Rebalancing Procedures
From time to time, market conditions may cause your asset allocation to vary from the
established target. To remain consistent with the asset allocation guidelines established by this
Investment Guidelines document, your Portfolio Manager will rebalance the portfolio on a
quarterly basis.
Duties of Responsibilities of Portfolio Manager
Your portfolio manager is expected to manage your portfolio in a manner consistent with this
Investment Guidelines document and in accordance with State and Federal law and the Uniform
Prudent Investor Act. HighMark Capital Management is a registered investment advisor and shall
act as such until you decide otherwise.
Your portfolio manager shall be responsible for:
1. Designing, recommending and implementing an appropriate asset allocation
consistent with the investment objectives, time horizon, risk profile, guidelines and
constraints outlined in this statement.
2. Advising the committee about the selection of and the allocation of asset categories.
3. Identifying specific assets and investment managers within each asset category.
4. Monitoring the performance of all selected assets.
5. Recommending changes to any of the above.
6. Periodically reviewing the suitability of the investments, being available to meet with
the committee at least once each year, and being available at such other times within
reason at your request.
7. Preparing and presenting appropriate reports.
8. Informing the committee if changes occur in personnel that are responsible for
portfolio management or research.
You shall be responsible for:
1. The oversight of the investment portfolio.
2. Providing your portfOliO manager with all relevant information on the Plan, and shall
notify him or her promptly of any changes to this information.
3. Advising your portfolio manager of any change in the Plan's circumstances, such as
a change in the actuarial assumptions, which could possibly necessitate a change to
your overall risk tolerance, time horizon or liquidity requirements; and thus would
dictate a change to your overall investment objective and goals for the portfolio.
4. Monitoring performance by means of regular reviews to assure that objectives are
being met and that the policy and guidelines are being followed.
Central Contra Costa Sanitary District
Investment Guidelines
May 2008
6
Communication
As a matter of course, your portfolio manager shall keep you apprised of any material changes in
HighMark Capital's outlook, recommended investment policy and tactics. In addition, your
portfolio manager shall meet with you no less than annually to review and explain the portfolio's
investment results and any related issues. Your portfolio manager shall also be available on a
reasonable basis for telephone communication when needed.
Any material event that affects the ownership of HighMark Capital Management or the
management of the portfolio must be reported immediately to you.
Disclosures
Union Bank of California, NA and HighMark Capital Management, Inc. are wholly owned
subsidiaries of UnionBanCal Corporation. Investments are not deposits or bank obligations, are
not guaranteed by any government agency, and involve risk, including loss of principal.
Central Contra Costa Sanitary District
Investment Guidelines
May 2008
7
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Attachment
CENTRAL CONTRA COSTA SANITARY DISTRICT
STATEMENT OF INVESTMENT POLICY
The investment policy of the Central Contra Costa Sanitary District is embodied in the
following eleven sections:
I. Statement of Objectives
The temporary investment portfolio of the District will be managed to ensure
that normal cash needs, as well as scheduled extraordinary cash needs can
be met. Therefore, adequate liquidity will be the first priority. Second priority
will be the safety of the portfolio ensuring that the investments could be
readily converted to cash if needed without causing a material change in the
value of the portfolio. Lastly, the portfolio will be invested to attain a market
average rate of return, after meeting the first two previously stated objectives.
II. Permissible Investments
Within the constraints prescribed by the Government Code of the State of
California for permissible investments, the District's investment portfolio will
only be invested in the following instruments:
· United States Treasury Bills and Notes, and obligations of government
agencies for which the full faith and credit of the United States are
pledged.
· Bankers Acceptances, drawn on and accepted by a commercial bank,
which are eligible for purchase by the Federal Reserve System.
· Collateralized Certificates of Deposit issued by a Federal or State
chartered bank or a Federal or State chartered savings and loan
association.
· Negotiable Certificates of Deposit issued by a Federal or State chartered
bank or a Federal or State chartered savings and loan association.
· Commercial Paper of prime quality limited to corporations with assets over
$500,000,000.
· Medium Term Notes of a maximum of five years maturity issued by U. S.
corporations or any Federal or State despository institution.
· Local Agency Investment Fund of the State of California.
· Investment Trust of California (CaITRUST)
N:\AOMINSUP\AOMIN\POSPAPER\Approve Investment Policy 09-06-07.doc
Page 3 of 5
III. Bank and Dealers
The District will use the services of the Treasurer's Office of the County of
Contra Costa which will transact the District's investment decisions in
compliance with the requirements described in this investment policy. The
County Treasurer's Office will execute the District's investments through such
brokers, dealers and financial institutions as are approved by the County
Treasurer, and through the State Treasurer's Office for investment in the
Local Agency Investment Fund.
IV. Maturities
The maximum maturity for investments of the District is one year. Prior
approval of the Board of Directors must be obtained to acquire investments
with maturities beyond one year. However, investments in Treasury Notes
and the Local Agency Investment Fund would not be subject to the one year
maximum maturity.
V. Diversification
To minimize the risk of loss through default, the total amount invested in a
single issuer will not be greater than 15 percent of the District's investment
portfolio value, except that the 15 percent limitation will not apply to United
States Treasury Bills and Notes and investment in the Local Agency
Investment Fund and CaITRUST.
VI. Risk
Credit and market risks will be minimized through adherence to the list of
permissible investments, a limit on maximum maturities, and the limitation on
the total investment in a single issuer.
VII. Delegation and Authority
The District Controller will be responsible for investment transactions which
should be made in accordance with this investment policy and within the
internal controls described in Section IX.
VIII. Prudence
Prudent judgment must be exercised by the District Controller responsible for
investment transactions undertaken in accordance with this investment
policy.
N:\ADMINSUP\ADMIN\POSPAPER\Approve Investment Policy 09-06-07.doc
Page 4 of 5
IX. Controls
The District Controller will establish subsidiary accounting records of each
investment which will enable the determination of income earned monthly and
through maturity, and the balancing of the principal amounts to a control
account in the general ledger. Internal control procedures will require the
countersignature of the Director of Administration for all transactions, which
are initiated by the Controller. The dollar limit of the Director of
Administration will be $5 million. Investment transactions which exceed $5
million will require the additional approval of the General Manager. Such
internal controls are to be reviewed by the District's independent auditors
annually.
X. Reporting
The District Controller will annually render a statement of investment policy to
the Board of Directors. The Controller will submit a monthly report to the
District's General Manager, Board of Directors and internal auditor showing
the type of investment, issuer, date of maturity, par (or face), dollar amount
invested, current market value of all securities, and the source of this same
valuation, and a statement of compliance of the portfolio with the investment
policy.
XI. Performance Evaluation
A performance evaluation will be completed by the District's independent
auditors every year, commencing with the 2004-2005 fiscal year, to
determine whether the investment objective of achieving a market-average
rate of return is being realized. In determining the market-average rate of
return, the average return of three month U.S. Treasury Bills will be used as a
comparison. The weighted average of the portfolio will be calculated each
month and compiled to determine the annual yield. Results of the
comparison between the District's portfolio and the three month T -Bill
benchmark will be reported to the Board annually.
N:\AOMINSUP\AOMIN\POSPAPER\Approve Investment Policy 09-06-07.doc
Page 5 of 5
State of California
Pooled Money Investment Account
Market Valuation
4/30/2008
Carrying Cost Plus
Description Accrued Interest Purch. Fair Value Accrued Interest
United States Treasury:
Bills $ 1,340,973,555.57 $ 1,348,010,500.00 NA
Notes $ 3,065,700,460.48 $ 3,051,270,000.00 $ 51,527,480.00
Federal Aqencv:
SBA $ 568,397,310.76 $ 565,211,249.98 $ 4,290,861.89
MBS-REMICs $ 1,146,978,163.95 $ 1,154,037,010.07 $ 5,441,591.88
Debentures $ 4,647,025,827.35 $ 4,670,904,514.00 $ 103,623,599.45
Debentures FR $ 5,654,292,973.62 $ 5,648,697,880.00 $ 25,325,650.30
Discount Notes $ 14,773,012,394.4 7 $ 14,991,588,900.00 NA
FHLMC PC $ 109,789.72 $ 112,146.77 $ 1,812.11
GNMA $ 168,807.65 $ 190,657.83 $ 1,673.74
CDs and YCDs FR $ 200,000,000.00 $ 200,000,000.00 $ 1,664,690.00
Bank Notes $ 1,105,000,000.00 $ 1,104,492,118.80 $ 4,636,325.00
CDs and YCDs $ 15,110,071,761.72 $ 15,109,154,519.80 $ 82,730,750.68
Commercial Paper $ 6,900,380,488.96 $ 6,914,033,997.80 NA
Corporate:
Bonds FR $ 129,081,571.14 $ 127,179,284.00 $ 518,206.38
Bonds $ 123,534,783.58 $ 125,156,881.48 $ 977,885.40
Repurchase Aqreements $ - NA
Reverse Repurchase $ - $ - $ -
Time Deposits $ 9,625,500,000.00 $ 9,625,500,000.00 NA
AB 55 & GF Loans $ 9,098,005,325.60 $ 9,098,005,325.60 NA
TOTAL $ 73,488,233,214.57 $ 73,733,544,986.13 $ 280,740,526.83
Fair Value Including Accrued Interest
$
74,014,285,512.96
Repurchase Agreements, Time Deposits, AB 55 & General Fund loans, and
Reverse Repurchase agreements are carried at portfolio book value (carrying cost).
Permitted Asset Classes and Security Types
The following asset classes and security types have been approved by HighMark for use in client
portfolios:
Asset Classes
. Fixed Income
o Domestic Bonds
o Non-U.S. Bonds
. Equities
o Domestic
o Non-U.S.
o Emerging Markets
o Real Estate Investment Trust (REITs)
. Cash and Cash Equivalents
Security Types
. Equity Securities
o Domestic listed and unlisted securities
o Equity and equity-related securities of non-US corporations, in the form of
American Depository Receipts (UADRsU)
. Equity Mutual Funds
o Large Cap Growth and Value
o Mid Cap Core
o Small Cap Growth and Value
o International and Emerging Markets
o REITs
. Exchange Traded Funds (ETFs)
. Fixed Income Securities
o Government/Agencies
o Mortgage Backed Bonds
o Corporate Bonds and Notes
. Fixed Income Mutual Funds
o Corporate
o Government
o High Yield
o International and Emerging Market
o Convertible
o Preferred
. Cash and Cash Equivalents
o Money Market Mutual Fund
o Commercial Paper
o CDs and Bankers Acceptance
Central Contra Costa Sanitary District
Investment Guidelines
May 2008
2
~
Central Contra Costa Sanitary District
BOARD OF DIRECTORS ~ DRAFT
POSITION PAPER
Board Meeting Date: June 19, 2008
No.:
5. d..
Type of Action:
Subject: BOARD MEMBER CONFERENCE AND MEETING ATTENDANCE
APPROVAL PROCESS
Submitted By:
Initiating Dept./Div.:
REVIEWED AND RECOMMENDED FOR BOARD ACTION:
James M. Kelly,
General Manager
E. Boehme
Secretary of the
District
K.Alm
District Counsel
ISSUE: Board Members requested that the current process for Board approval of Board
Member conference attendance and attendance at other meetings be reviewed to ensure
transparency for the public and to comply with AB 1234, and to determine if revisions are
appropriate. The Budget and Finance Committee reviewed the process on May 12 and
made recommendations for Board consideration.
RECOMMENDATION: Consider the current process and adopt the attached resolution and
policy which sets forth the process for approval and reporting of Board Member
conference/meeting attendance.
FINANCIAL IMPACTS: $44,000 has been budgeted for fiscal year 2008-09 for Board
Member conference attendance at California Association of Sanitation Agencies (CASA),
California Special Districts Association (CSDA), Water Environment Federation Technical
Conference (WEFTEC), and other miscellaneous conferences that may be requested and
approved throughout the year. It also includes reimbursement for attendance at local
meetings. Reimbursement will be in accordance with adopted Board policies.
ALTERNATIVES/CONSIDERATIONS: Do not revise the current practice, or consider a
greater degree of advance notification prior to attendance.
BACKGROUND: It has been suggested that, to improve transparency, a more visible
process be established for approval of Board Member conference and meeting attendance.
The Board Budget and Finance Committee (McGiII/Nejedly) reviewed the current process
on May 12, 2008 with that in mind.
Currently, Board Member conference attendance is included and approved in the District
budget, and Board Members report out at a Board Meeting upon their return from the
conference, in compliance with AB 1234. They also report out at a Board Meeting following
their attendance at other local meetings for which they receive a stipend or reimbursement.
POSITION PAPER
Board Meeting Date: June 19, 2008
Subject: BOARD MEMBER CONFERENCE AND MEETING ATTENDANCE
APPROVAL PROCESS
$44,000 has been budgeted for Board Member conference and meeting attendance for
fiscal year 2008-09. Each conference can cost up to approximately $2,000.
Following a review of the current policy and consideration of various options provided by
staff, the Budget and Finance Committee recommended that two changes be made to the
current process:
(1) In addition to inclusion in the budget, Board Member conference/meeting
attendance and the dollar amount budgeted will be highlighted as part of the
budget process and presentation.
(2) Board Members will announce at a Board Meeting, in advance, their
attendance at any upcoming conferences that have been approved in the
budget. Any additional conferences a Board Member may wish to attend that
were not listed in the budget will need separate Board approval in advance.
Board Members will also, when timing permits, announce in advance their
attendance at local business meetings, including but not limited to Contra
Costa Mayors' Conference meetings and Contra Costa Council events.
Each Board Member will continue providing reports at a Board Meeting following the event
on his or her conference/meeting attendance, in compliance with AB 1234.
For fiscal year 2008-09, Board Members indicated interest in attending the following
conferences:
August 20-23, 2008, Monterey
CASA
Barbara Hockett (stipend for 2 Exec Board meetings)
Mike McGill
January 7-10,2009, Indian Wells
Barbara Hockett (stipend for 2 Exec Board meetings)
Mike McGill
March 2009, Washington, DC
April 29 - May 2, 2009, Napa
Barbara Hockett
Jerry Lucey
Barbara Hockett (stipend for 2 Exec Board meetings)
Mike McGill
POSITION PAPER
Board Meeting Date: June 19,2008
Subject: BOARD MEMBER CONFERENCE AND MEETING ATTENDANCE
APPROVAL PROCESS
California Special Districts Association
September 22-25, 2008, Irvine
Mike McGill (stipend for each day attended)
Water Environment Federation Technical Conference
October 18-22, 2008, Chicago
Barbara Hockett
Mike McGill
This totals 11 individual conference attendances, each of which can cost up to
approximately $2,000. Additional money has been budgeted in the event that Board
Members may ask to attend other conferences throughout the year.
RECOMMENDED BOARD ACTION: Approve the revisions to the current process for
Board Member conference/meeting attendance, as recommended by the Budget and
Finance Committee. Adopt the Resolution and Exhibit A.
RESOLUTION NO. 2008-?
A RESOLUTION SETTING FORTH PROCEDURES FOR APPOINTMENT TO AND
ESTABLISHMENT OF BOARD COMMITTEES AND MEETING COMPENSATION
REQUIREMENTS FOR BOARD MEMBERS
WHEREAS, Section 6489 of the California Health and Safety Code provides that
compensation be paid to Board Members for each day's attendance at meetings of the
Board or for each day's service rendered as a Director by request of the Board; and
WHEREAS, in accordance with the Health and Safety Code and the California
Water Code Sections 20200 et seq., Ordinance 241 was adopted on February 15, 2006,
setting the Board compensation at $221 per approved meeting, not to exceed more
than one meeting per day and six meetings per calendar month; and
WHEREAS, in accordance with Section 2.04.020 of the District Code, when the
Board considers it necessary for the efficient transaction of business, it may approve the
creation of a committee for the purpose of reviewing, investigating, and recommending
with reference to a particular matter; and the President shall appoint the members of
said committee and shall have the authority to appoint an ad hoc committee or
representative to similarly act pending a Board Meeting; and
WHEREAS, the President may name an alternate to serve in the absence of an
appointed Committee Member or District representative, and such alternate shall
receive the compensation previously set forth; and
WHEREAS, the Board has deemed it necessary for the efficient operation of the
District to appoint Board Members to represent the District on various commissions,
committees and joint powers authorities, and to act as liaisons to cities and the County;
and
WHEREAS, in accordance with AB 1234, the Board hereby adopts the attached
policy (Exhibit A) which sets forth meeting compensation, reimbursement and reporting
requirements and approval process for Board Member attendance at meetings and
conferences; and
WHEREAS, in accordance with AB 1234 and to encourage participation and
attendance at conferences and organizations which serve the interests of and provide
benefit to the District, the Board has determined that Board Members may be
compensated for each day's attendance at conferences and meetings listed in Exhibit
A, Section 2; and
WHEREAS, compensation may be approved for attendance at a meeting or
conference not covered in Exhibit A to this Resolution if approved in advance by the
Board; and
-- - - --~--~------~--,-_.",~-~--'--"-"---'----'---'--"-----,-~-----,--"-~---""""--"-'--'----"-'-"--~'-'",_._.._~-,....._-,.,._,-...- ._--_.__._.._--_._~
WHEREAS, travel days to and from meetings or conferences are not
compensable.
NOW, THEREFORE, BE IT RESOLVED, that the President of the Board of
Directors adopts Exhibit A as the Board Member conference and meeting attendance
policy, and shall appoint Board Members to the standing committees and other
appointments as listed in Exhibit A, Section 2.
BE IT FURTHER RESOLVED, that meeting attendance slips for Board Members
for the meetings listed above and for regular Board Meetings shall be approved by the
Board President or, in his or her absence, the President Pro Tern. Meeting attendance
slips for the Board President shall be approved by the President Pro Tern, or, in his or
her absence, a Board Member designee.
PASSED AND ADOPTED this 19th day of June, 2008, by the following vote:
AYES:
NOES:
ABSTAIN:
Members:
Members:
Members:
President of the District Board of the
Central Contra Costa Sanitary District,
County of Contra Costa, State of California
COUNTERSIGNED:
Secretary of the Central Contra Costa
Sanitary District, County of Contra
Costa, State of California
Approved as to Form:
Kenton L. Aim
District Counsel
EXHIBIT A
This policy sets forth the requirements and approvals for conference and meeting
attendance, and reporting requirements, in compliance with AB 1234.
1. Definitions
Stipend (also referred to as compensation) - this is the compensation Board
Members receive for attendance at meetings approved by the Board. The
stipend is set forth by District ordinance in accordance with the Health and Safety
Code and the California Water Code Sections 20200 et seq. Ordinance 241 was
adopted on February 15, 2006, setting the Board compensation at $221 per
approved meeting, not to exceed more than one meeting per day and six
meetings per calendar month.
Reimbursement - this is where the District either reimburses after the fact or
may pay in advance for Board Member attendance at conferences or business
meetings. It is separate from the stipend. Reimbursement covers such items as
mileage, registration, meals and other travel-related expenses incurred to attend
the meeting or conference, in accordance with the District's Travel Policy. For
certain meetings, Board Members may receive both the stipend and receive
reimbursement for travel and other expenses.
2. Meetinas for which the Stipend (Compensation) is received
Board Members are hereby authorized to receive the stipend and appropriate
reimbursement for attending the following meetings. Representatives are
appointed each year by the Board President.
i
Budget and Finance Committee
Capital Projects Committee
Human Resources Committee
Outreach Committee
Recycled Water Committee
Household Hazardous Waste Committee
Real Estate Committee
Ad Hoc Committees
Board Liaison to Cities and County
California Special Districts Association - Contra Costa Chapter
Friends of the San Francisco Estuary
Sanitation and Water Agencies of Contra Costa County
In addition, the stipend and appropriate reimbursement will be paid for each
day's attendance at the following:
Meetings of the California Association of Sanitation Agencies (CASA)
Executive Board, if serving as a member of the Executive Board;
California Special Districts Association Conferences
(Appropriate reimbursement refers to the reimbursement of mileage, parking,
registration, meals, etc.)
3. Meetinas for which Reimbursement is received
Board Members will receive reimbursement for attending meetings at which
their attendance is of benefit to the District. These include but are not limited to
Contra Costa Mayors' Conference meetings, Contra Costa Council events, local
Chamber events within the District, meetings with Cities within the District, and
other meetings where the topic or purpose is of benefit or interest to the District,
or promotes inter-agency co-operation and partnerships.
4. Approval Process
Meetinos for which Stipend is received
Approval for attendance at these meetings is listed above in Section 2.
Conferences
Board Members will indicate which conferences they wish to attend in advance of
each fiscal year. These will be included and highlighted clearly during the budget
process and approved as part of the budget. Any conferences not included and
approved in the budget must be approved by the Board in advance, as required
by AB 1234.
Meetinos
This policy sets forth the approval that Board Members may attend meetings as
described above.
5. Reportina Process
Board Members will announce, in advance, when timing permits, their
attendance at upcoming conferences or other meetings for which they receive
the stipend and/or reimbursement. Board Members will also provide a brief
report at the meeting following their return on their meeting or conference
attendance, in compliance with AB 1234.
Expenditure Summary
SELF INSURANCE FUND
$4,471.15 Block Environmental Services, Inc. 003-0000-991.14-22
$991.25
$1,441.25
$1,060.40
$978.25
003-0000-991.14-22 $894.45
003-0000-991.14-20 $600.00
003-0000-991.14-22 $500.00
003-0000-991.14-22 $3,026.25
003-0000-991.14-20 $316,334.07
003-0000-991.14-20 $803.27
003-0000-991.14-22 $3,136.87
003-0000-991.14-22 $599.00
003-0000-991.14-20 $4,803.50
003-0000-991.14-22 $1,244.00
003-0000-991.14-22 $3,502.56
003-0000-991.14-22 $230.00
2 102870 $894.45 Blue Sky Cleaners
3 102871 $600.00 Janet Murray
4 102872 $500.00 Perfect Service, Inc.
5 102873 $3,026.25 Restoration Management Co.
6 102874 $316,334.07 Kaiser Foundation Hospital
7 102875 $803.27 Miracle Auto Painting
8 102876 $3,136.87 Restoration Management Co.
9 102877 $599.00 Rota-Rooter Sewer Service
10 102878 $4,803.50 U.S. Bank Corp Payment
11 102879 $1,244.00 Hunter Plumbing Consulting, Inc.
12 102880 $3,502.56 Restoration Management Co.
13 102881 $230.00 Tom's Piano Moving Co.
RUNNING EXPENSE FUND
CL# - Claim Log Number
GL - General Liability Claims
P - Property Claims
AC - Auto Claims
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