Minutes_Investment Oversight Advisory Commission 10 28 13Masterpiece on the Mississippi
Dubuque
bitell
All- America City
1 I
2007 • 2012 • 2013
TO: Members of City of Dubuque Investment Oversight Advisory Commission
FROM: Paul Lassance, Investment Oversight Advisory Commission
Ken TeKippe, Finance Director
RE: Un- approved Minutes of the October 23, 2013 Meeting of the Investment
Oversight Advisory Commission and Chairman's Quarterly Report
DATE: October 28, 2013
1. Commission members Paul Lassance, Gary Ruden, Brad Chalmers and Rick Runde
were present. Ken TeKippe, Finance Director, and Tami Lansing, Accountant were
also present.
2. The meeting was called to order at 3:00 p.m. in Conference Room II in City Hall
Annex by Paul Lassance. Finance Director Ken TeKippe certified that the meeting
was in compliance with the Iowa open meetings law.
3. Brad Chalmers moved that the minutes of the July 24, 2013, meeting be approved.
The motion was seconded by Gary Runden and approved unanimously
4. Robert Leuty of Dana Investment Advisors provided a handout with information on
the portfolio performance and allocation, index total return comparison, economic
update, bond portfolio observations and list of current holdings. Robert noted the
safety objectives for the fund. The effective bond duration is 0.87 years and the
average months to coupon reset is 6.60 reflect the very conservative nature of fund.
Dana has maintained investing in Treasury Inflation- Protected Securities (TIPS).
20% of portfolio with 53% invested in mortgages bonds. 10% cash investment is
higher than normal due to timing of payments on mortgages. TIPS are government -
issued bonds that provide a hedge against inflation and provide liquidity.
The average annual total returns since inception of account in 1989 is 4.90% versus
the three month Treasury Index returns (3.40 %) and one year Treasury Index
returns (4.18 %), have outperformed benchmarks with low risk.
Robert provided the following comments on the fixed income market: lowest rates in
generation, have a AAA credit rating in bonds, federal fund rates established by Ben
Bernanke to be retained at low levels for awhile, no changes in philosophy should
Janet Yellen replace Bernanke.
Robert confirmed that Dana is in compliance with the City's current investment
policy.
5. Ken distributed investment return information for September 30, 2013, from the four
investment managers: Dubuque Bank and Trust (DB &T), U.S. Bank, Dana
Investment Advisors and First Community Trust. Also distributed a recap of
manager/ custodian annual fees based on September 30, 2013 market values, all
managers currently use same fee schedule. Interest rates for the two high yield
savings accounts were reviewed.
Response from American Trust and Savings Bank relative to maintaining current
custodian fees in lieu of investment managers recently reducing their fees was
discussed.
The Commission reviewed the September 2013 quarterly reports prepared by Tami
Lansing. Ken indicated that the City continues to use a high yield savings account
option versus certificates of deposit. The accounts at DB &T and EDSB continue to
provide rates slightly higher than the six month CD bids. CDs for excess funds of
Dubuque Metropolitan Area Solid Waste Agency are bid. This allows for continued
monitoring of CD rates and also provides investment opportunities to local financial
institutions. Continues to be limited interest by local financial institutions in providing
bids for certificate of deposit (Dubuque Bank and Trust and American Trust and
Savings Bank normally always bid). Approximately $28.6 million unspent bond
proceeds at end of September.
The City recently received $12.4 million from property taxes collected by county in
September and distributed in October. Approximately $4.0 million represents TIF
payments with funds used to pay TIF debt or rebated to property owners.
6. The letter from Dubuque Bank and Trust on their investment strategy was discussed
briefly with plans to address at January 22, 2014 meeting with Dubuque Bank and
Trust representatives scheduled to attend.
7. Tami explained possible options to receiving reports electronically in future months.
Committee members present willing to receive information electronically with hard
copies available for the quarterly meetings. Will review in a few months.
8. There was no communication from the public, commission or staff to report
according to Ken.
9. The next meeting of the Commission is scheduled for Wednesday, January 22 2014,
at 3:00 p.m. in City Hall. A representative from Dubuque Bank and Trust will be
invited to the meeting.
10. Gary Ruden moved that the meeting adjourn. The motion was seconded by Rick
Runde and approved unanimously. The meeting adjourned at 4:10 p.m.