Discussion:
General Fund - March 2022 (see attachment)
This early in the year, the timing of one or two large receipts or payments tend to skew the variances.
Revenue variances (+/- 25.0% target)
- Taxes and special assessment will remain below budget targets until the first half tax settlement is received.
- Licenses and permits are exceeding the budget amount as a result of building permit revenue received through the 1st quarter.
- Miscellaneous includes investment earnings, with rising interest rates in 2022 the City currently has a large unrealized loss which is not reflected. This adjustment occurs at year-end.
Expenditure variances (+/- 25.0% target)
- Total General Fund expenditures are within the normal range and similar to last year's percentage through March. All departments are reasonably in-line with budget expectations.
Community Center/Ice Arena/SandVenture - March 2022 (see attachment)
Similar to the analysis of the City's General Fund, reviewing revenue and expenditures early in the year can be easily skewed depending upon what type of transactions did or did not occur.
Community Center - Revenues are ahead of this time last year.
Ice Arena - Revenues are slightly behind of this time last year.
Quarterly Investment Portfolio Report - Q1, 2022 (See attachment)
Attached is the 1st quarter investment portfolio report including a cover page that provides a comparison of investment results over the past five years. The report provided by Wells Fargo Securities encompasses all city investments.
As required by the investment policy the report provides:
- Total return performance measured against the the three year treasury (Page 6)
- Weighted average yield (Page 3/Page 6)
- A listing of individual securities held at the end of the reporting period listed by maturity date (Pages 14-16)
- The carrying basis, the current calculated accredited basis and the current market value (Page 3)
As a reminder, the city's investment policy is guided by the investment acronym SLY, which stands for Safety, Liquidity and Yield, and in that priority order. Safety of principal is the foremost objective of the investment program. Second, the investment portfolio needs to remain sufficiently liquid to meet day-to-day operational requirements. Lastly, attaining a market yield is the third goal of the investment policy. The first two priorities of safety and liquidity limit the ability of the portfolio to realize comparable private sector earning in those robust years. However, the policy also minimizes the changes of experiencing losses in the down years.