Information #2 04-18-2022 - Laserfiche WebLink

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Information City � Memorandum To: MayTor and CityT Council From: Lori Ziemer, Finance Director Date: Apri118, 2022 SubjeCt: QuarterlyT Investment Report �anuaryT — March 2022) Introduction The purpose of this report is to update the CityT Council on the status of the various investments the cit�r maintains as of March 31, 2022. Background The investment policy complies �uith state statutes and generallyT follo�us the Government Finance Officers Associarion (GFOA) model. The investment goals for the Cit�T of Elk River are passive in nature due to the allowable investments permitted under state statutes. The cityT has four objectives for investing, in order of importance, they are: 1) safetyT of principal, 2) liquidityT, 3) return on investment, and 4) maintaining the public trust This means we aYe focused on not losing on the original investment, having sufficient funds on hand to meet ongoing operating cash needs, getting a market rate of return, and not purchasing speculative investments. State statutes limit the city's ability to invest in many risky types of investments. The city is generally limited to federal and state government obligations or agencies backed b�T them, rated debt of local governments, short-term highlyT rated commercial paper, certificates of deposit, and moneyT market accounts (with collateYalization if in excess of FDIC insurance amounts). The cityT intends to hold investments until maturityT, which means we will get the rate of return for which we invest our funds. The finance staff makes sure the cityr is sufficiently liquid byr continually updating our forecast on the anticipated cash flo`v needs over the next five-�rear time horizon. We anticipate two large tax settlements each year along with the regularly-scheduled debt service pa�rments. We also build in a reserve balance maintained in money market accounts in case of unexpected expenditures.