Quarterly report Inv Oversight 01_29_07-,
From: City of Dubuque, Investment Oversight Commission
To: MEMBERS of the CITY COUNCIL OF DUBUQUE
Regarding: Quarterly Report
In Accordance with Ordinance No. 50-92 (3) Sec. 2-231, City code, the City of Dubuque
Investment Oversight Commission (IOC) respectfully submits the SSth quarterly report.
The IOC members met on January 24, 2007. The transactions reviewed through December 31,
2006 appear to be in compliance with the Articles in the Investment Policy.
The meeting started with the annual review of the funds managed by Dubuque Bank and Trust
(DB&T) represented by William Zaleski, Kim Grant and Andrew Douglas.
Kim Grant reviewed the current investments that DB&T manages for the City of Dubuque. The
emphasis continues to be the use of government agency bonds and collateralized mortgage
instruments in the portfolio they manage for the City. The overall return for 2006 on funds
manages by DB&T was a positive 4.75% return. Mrs.Grant confirmed that the portfolio managed
by DB&T is in compliance with the City's current investment policy.
Mr. Douglas made a presentation on using two new types of bonds in the City's portfolio. The
first type discussed are AAA-rated, insured Taxable Municipal bonds. Committee members asked
questions about the rating process, insurance on these bonds, liquidity, percentage of portfolio to
be invested in these bonds and the length of maturity and duration of these bonds.
The second new type of investment idea floated before the IOC was the use of an investment
grade corporate bond fund. The advantage would be opportunity for a higher rate of return. The
committee discussed of the risk to principal of this type of investment. There is also greater
volatility in the Corporate Bond market than this the types of investments the managers have
historically utilized to invest City funds in.
A resolution was passed recommending that no more than 10% of the city's funds managed by
DB&T be invested in AAA-rated, insured Taxable Municipal bonds and no funds should be
invested in the Corporate Bond fund.
Ken TeKippe, City Finance Director reviewed the fees schedule of charged by the four
investment managers. There have not been any significant changes in the types of investments
utilized by City funds over the last year. Certificates of Deposits (CD) rates continue increase
and continue to yield more than equivalent maturity US Treasury Bills and Notes
The IOC did not receive any communication or questions from the public.
Respectfully submitted
~auCLassance
Paul Lassance
Chairman
Investment Oversight Commission