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TO: Members of City of Dubuque Investment Oversight Advisory Commission
FROM: Kenneth J. TeKippe, Finance Director - C~ ~`
RE: Un-approved Minutes of the April 22, 2009 Meeting of the Investment
Oversight Advisory Commission
DATE: April 29, 2009
Commission members Paul Lassance, Steve Reisdorf, Hiram Melendez, Virgil Blocker
and Gary Ruden were present. Ken TeKippe, Finance Director, and Jean Nachtman,
Assistant Finance Director, were also present.
1. The meeting was called to order at 3:00 p.m. in Conference Room A in City Hall by
Chairperson Paul Lassance. Finance Director Ken TeKippe, certified that the
meeting was in compliance. with the Iowa open meetings law.
2. Virgil Blocker moved that the minutes of the January 28, 2009 meeting be
approved. The motion was seconded by Hiram Melendez and approved
unanimously.
3. Mr. Nick Zimmerman, Vice President Relationship Manager and Michael Maloney,
Senior Portfolio Manager of US Bank provided a handout which provided
information on performance, maturity distribution and fixed income market outlook.
Michael stressed the high quality assets in our portfolio (AAA) and that there are
no safety worries. Thoughts include: do not want to buy long-term at this time,
believe treasurers' and agencies rates will improve, economy will turn around, but
not sure of the price, may take a few years for returns to increase, everyone wants
safety, period of deflation with housing prices going down.
Michael Maloney confirmed that lJS Bank is in compliance with the City's current
investment policy.
4. Ken distributed investment return information for March 31, 2009, from_the four
investment managers: Dubuque Bank and Trust, U.S. Bank, Dana Investment
Advisors and First Community Trust. Also distributed a recap of manager/
custodian annual fees based on March 31, 2009, market values.
5. The Commission reviewed the March 2009 quarterly investment reports prepared
by Jean Nachtman. Recent interest rates for certificates of deposit acquired have
been extremely low recently, less than 1 %. A summary of 51 investment quotes
for certificates of deposit bids in the current fiscal year was distributed. U.S. Bank
has recently not been bidding on certificates of deposit due to amount of
government funds held by their bank statewide. The City recently received $8.0
million of property tax revenue that provided a source of funds to invest. The City
continues to spend escrow and bond funds relative to parking facility adjacent to
the Diamond Jo Casino in the Port of Dubuque. Additional drawdowns on
borrowings via the State Revolvirig Loan Fund (SRF) continue for water,
stormwater and sanitary sewer projects.
6. Committee discussed FDIC insured corporate bonds issued under the Temporary
Liquidity Guarantee Program (TLGP}. Manager's position is that the TLGP bonds,
while issued by corporations, are more appropriately classified as government
securities and provided a letter supporting their position. Committee decided to
inform manager to liquidate corporate bonds without incurring investment loss:
Committee still recognizes these investments as corporate bonds prohibited by city
investment policy.
7. Discussed the issue of custodian misclassifying some securities and that one
manager offered to provide custodian services free for assets they manage and
two basis points for others. Also, reviewed the possibility of current custodian
preparing monthly return information for four managers. The possibility of issuing
an RFP for custodial services was discussed.
8. Ken received a call on April 21, 2009 from Jill Lucida, Chairperson of Investment
Policy Certification Program for Association of Public Treasurers of the United
States & Canada that our policy was recertified. A formal written letter will be sent
to City.
9. Paul Lassance.and Hiram Melendez terms on commission expire July 1, 2009. A
form to reapply for the commission was provided to each.
10. There was no communication from the public, commission or staff to report
according to Ken.
11. The next meeting of the Commission is scheduled for Wednesday, July 22, 2009,
at 3:00 p.m. in City Hall. A representative from First Community Trust will be
invited to the meeting.
12. Gary Ruden moved that the meeting adjourn. The motion was seconded by Virgil
Blocker and approved unanimously. The meeting adjourned at 4:15 p.m.