Discussion and possible action to receive and file the Quarterly Investment Report for January through March 2024.

Effective cash management includes investment of available or idle funds. The City of Peoria invests all available funds of the City, taking into consideration anticipated cash flow requirements and the safety and risk of investments. Investments are made in accordance with the City’s Investment Policy, and Arizona Revised Statutes Title 35-321 through 35-329. The primary objective of the City’s investments, in order of priority, is:

Safety – Investments shall be undertaken in a manner that seeks to insure the preservation of capital in the portfolio.

Liquidity – The investment portfolio will remain sufficiently liquid to enable the City to meet all operating requirements which might be reasonably anticipated.

Diversification - Diversification of the portfolio will include diversification by investment type, issuer, maturity and market sector.

Yield – The investment portfolio shall be designed with the objective of attaining a market rate of return throughout budgetary and economic cycles, taking into account the City’s very strict risk constraints.

Public funds may only be invested in authorized and suitable investments such as: US Treasury Obligations, US Agency Obligations, Certificates of Deposits, Commercial Paper rated A-1/P-1, Corporate Notes rated A or better, Repurchase Agreements, Arizona Municipal Bonds rated AA- or better, Money Market Funds and the Arizona State Investment Pool. Investment in stocks, mutual funds, hedge funds, real estate, foreign investments or alternative investments are strictly prohibited.

The Investment Policy imposes certain maturity restrictions on the overall investment portfolio with specific maximum maturities for each type of investment and at least 20% of the portfolio maturing in less than 1 year to ensure liquidity.

The City utilizes PFM Asset Management LLC, an investment advisory firm, to provide advice and assist with managing its investments. All securities are held by a third party custodian in the City's name.

Quarterly investment reports are provided to the City Council to report the investment portfolio holdings, maturity distribution, investment performance and compliance with the Investment Policy.

The October through December of 2023 quarterly report was presented on the consent agenda at the February 6, 2024 Council Meeting.

Receive and file the Quarterly Investment Report.

As of 3/31/24, all of the City's investments were in compliance with the City's Investment Policy. Book value of the investment portfolio at 3/31/2024 was $620,728,398.  This is down $11,299,320 versus 12/31/2023, and up $35,826,768 versus 3/31/2023.  As interest rates continue to hold relatively stable, the market value is $4,953,749 (0.8%) less than the amortized cost of the portfolio.  The market value fluctuates relative to the book value through interest rate cycles and the strategy of maintaining a longer-term investment portfolio continues to add value over the long term. 

Investment income totaled $5,693,430 for the quarter (1/1/2024 to 3/31/2024) compared to $4,521,716 in the prior quarter and $2,784,231 in the same quarter in 2023.

The attached Investment Reports were prepared by PFM Asset Management.