HomeMy WebLinkAboutFinance Committee - May 12, 2022CITY OF NEWPORT BEACH
FINANCE COMMITTEE AGENDA - Final
100 Civic Center Drive - Community Room
Thursday, May 12, 2022 - 3:00 PM
Finance Committee Members:
Will O'Neill, Chair
Noah Blom, Mayor Pro Tem
Brad Avery, Council Member
William Collopy, Committee Member
John Reed, Committee Member
Nancy Scarbrough, Committee Member
Joe Stapleton, Committee Member
Staff Members:
Grace K. Leung, City Manager
Scott Catlett, Finance Director/Treasurer
Michael Gomez, Deputy Finance Director
Marlene Burns, Administrative Specialist to the Finance Director
NOTICE REGARDING PRESENTATIONS REQUIRING USE OF CITY EQUIPMENT
Any presentation requiring the use of the City of Newport Beach’s equipment must be submitted to the Finance
Director/Treasurer 24 hours prior to the scheduled Finance Committee meeting.
NOTICE REGARDING PUBLIC PARTICIPATION
Questions and comments may also be submitted in writing for the Finance Committee’s consideration by sending them
to Scott Catlett Finance Director/Treasurer, at scatlett@newportbeachca.gov. To give the Finance Committee adequate
time to review your questions and comments, please submit your written comments by no later than 5 p.m. the day
prior to the Finance Committee meeting. All correspondence will be made part of the record.
NOTICE TO THE PUBLIC
The Finance Committee meeting is subject to the Ralph M. Brown Act. Among other things, the Brown Act requires that
the Finance Committee agenda be posted at least seventy two (72) hours in advance of each regular meeting and that
the public be allowed to comment on agenda items before the Committee and items not on the agenda but are within
the subject matter jurisdiction of the Finance Committee. The Chair may limit public comments to a reasonable amount
of time, generally three (3) minutes per person.
It is the intention of the City of Newport Beach to comply with the Americans with Disabilities Act (“ADA”) in all respects.
If, as an attendee or a participant at this meeting, you will need special assistance beyond what is normally provided, the
City of Newport Beach will attempt to accommodate you in every reasonable manner. If requested, this agenda will be
made available in appropriate alternative formats to persons with a disability, as required by Section 202 of the
Americans with Disabilities Act of 1990 (42 U.S.C. Sec. 12132), and the federal rules and regulations adopted in
implementation thereof. Please contact the City Clerk’s Office at least forty-eight (48) hours prior to the meeting to
inform us of your particular needs and to determine if accommodation is feasible at (949) 644-3127 or
scatlett@newportbeachca.gov.
I.CALL MEETING TO ORDER
II.ROLL CALL
III.PUBLIC COMMENTS
Public comments are invited on agenda and non-agenda items generally considered to be
within the subject matter jurisdiction of the Finance Committee. Speakers must limit comments
to three (3) minutes. Before speaking, we invite, but do not require, you to state your name for
the record. The Finance Committee has the discretion to extend or shorten the speakers’ time
limit on agenda or non-agenda items, provided the time limit adjustment is applied equally to all
speakers. As a courtesy, please turn cell phones off or set them in the silent mode.
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IV.CONSENT CALENDAR
MINUTES OF APRIL 14, 2022A.
Recommended Action:
Approve and file.
DRAFT MINUTES 04142022
V.CURRENT BUSINESS
REVIEW OF INVESTMENT PORTFOLIO STRATEGY AND BENCHMARKA.
Summary:
Staff will provide the Committee with an overview of the City's current investment
strategy and several possible alternatives to determine if a change in strategy is
appropriate at this time.
Recommended Action:
Provide feedback to staff regarding changing investment strategies.
STAFF REPORT
THIRD QUARTER BUDGET UPDATEB.
Summary:
Staff will provide a presentation regarding the year-to-date and projected Fiscal Year
2021-22 budget performance.
Recommended Action:
Receive and file.
STAFF REPORT
FOLLOW-UP DISCUSSION OF PROPOSED FISCAL YEAR 2022-23 BUDGETC.
Summary:
Staff will provide the Committee with a copy of the Fiscal Year 2022-23 proposed
budget document. Should the Committee wish to continue April's discussion of the
Fiscal Year 2022-23 budget, this is also an opportunity to do so.
Recommended Action:
Receive and file.
ATTACHMENT A - PROPOSED BUDGET FY 2022-23
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INTERNAL AUDIT PROGRAM UPDATED.
Summary:
Bi-monthly progress update on the internal audit program.
Recommended Action:
Receive and file.
STAFF REPORT
WORK PLAN REVIEWE.
Summary:
Staff and Finance Committee to review the proposed work plan and identify matters
that members would like placed on a future Agenda for discussion, action, or report.
Recommended Action:
Receive and file.
ATTACHMENT A
VI.ADJOURNMENT
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CITY OF NEWPORT BEACH
FINANCE COMMITTEE
APRIL 14, 2022 MEETING MINUTES
I. CALL MEETING TO ORDER
The meeting was called to order at 3:00 p.m., in the Civic Center Community Room.
II. ROLL CALL
PRESENT: Chair Will O’Neill, Mayor Pro Tem Noah Blom, Council Member Brad
Avery, Committee Member William Collopy, Committee Member John
Reed, Committee Member Nancy Scarbrough and Committee Member
Joe Stapleton
ABSENT: None
STAFF PRESENT: City Manager Grace K. Leung, Finance Director/Treasurer Scott Catlett,
Administrative Specialist to the Finance Director Marlene Burns, Utilities
Director Mark Vukojevic, Public Works Director David Webb, Community
Development Director Seimone Jurjis, Fire Administrative Manager Mary
Locey, Management Assistant Lili Melero, Senior Budget Analyst Amber
Haston, Purchasing And Contracts Administrator Sander Huang, Public
Works Finance/Administrative Manager Theresa Schweitzer, and Budget
Manager Shelby Burguan
MEMBERS OF THE
PUBLIC: Charles Klobe and Jim Mosher
III. PUBLIC COMMENTS
Jim Mosher reported he reviewed the changes to the fee schedule and subsidy policies that were
presented to the City Council. He noted staff had recommended refunding appeal fees if the
applicant was successful but noted there was some reluctance to extend that to Planning Division
until the matter could be studied. He explained the cost of studying the fees is probably greater
than the amount of money in question. He reported there were 17 appeals in the last 12 years with
four of them being in the last year. He believes there may be the possibility of one refund per year
and encouraged the Finance Committee to keep that in mind.
Chair O’Neill recommended City Manager Grace Leung agendize the item for the Planning
Commission to review as a matter of policy.
IV. CONSENT CALENDAR
MINUTES OF MARCH 10, 2022
Recommended Action:
Approve and file.
Jim Mosher suggested minor changes to the minutes.
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MOTION: Committee Member Collopy moved to approve the minutes, as amended, seconded
by Committee Member Stapleton. The motion carried 7 ayes – 0 noes.
V. CURRENT BUSINESS
A. PROPOSED FISCAL YEAR 2022-23 BUDGET OVERVIEW
Summary:
Staff will provide the Committee with an overview of the expenditure budget for Fiscal Year
2022-23 that will be presented to the City Council in May.
Recommended Action:
Receive and file.
Finance Director/Treasurer Catlett provided a brief overview of the guiding principles of the
budget, additional areas of focus for this year, and the budget development timeline.
Budget Manager Shelby Burguan provided a brief status update on the current year’s budget.
She advised a $15.9 million increase in projected revenue and noted that $10 million came
from Property Tax, Sales Tax, and Transient Occupancy Tax (TOT). She reported staff
anticipates ending the year with $15.2 million in Unrestricted Funds after the $31 million
appropriation by the City Council from the Fiscal Year 2020-21 Surplus. She advised staff will
be returning next month to present the 3rd Quarter budget update to the Finance Committee
and also anticipates an increase in the year-end projected surplus.
Budget Manager Burguan reported a 12.5% growth in the Fiscal Year 2022-23 proposed
operating budget, primarily due to the Tidelands Fund presentation format change, the increase
in proposed CalPERS UAL payment to $40 million, the higher Internal Service Fund charges
based on a recent project to review rates, and adjustments to Police Department and Fire
Department overtime budgets. Finance Director/Treasurer Catlett clarified there will be no
additional overtime spending and noted this is simply an accounting change. Budget Manager
Burguan explained the increase also includes an additional $5 million CalPERS UAL payment,
a possibility that was discussed at the City Council’s January Planning Session.
Budget Manager Burguan provided a brief overview of Fiscal Year 2022-23 expenditures by
fund. She reported growth in the General Fund was 8.1% and Wastewater Fund growth was
23.4%. She noted the Wastewater Fund growth was due to the improved insurance Internal
Service Fund (ISF) allocation methodology and updated administrative charge calculations that
better apportion costs between the Water and Wastewater Funds.
Utilities Director Mark Vukojevic provided a brief overview of the anticipated impact of ongoing
inflation on the City’s Water and Wastewater Funds. He explained that capital & maintenance
projects and materials have been greatly impacted by inflation. He advised brief higher inflation
is manageable in the short-term, especially if it stabilizes, but sustained higher inflation or a
prolonged drought could lead to future rate implications.
Chair O’Neill inquired about the definition of a prolonged drought. Utilities Director Vukojevic
advised it is a drought that lasts longer than 1.5 years. He noted the drought would require the
City to cut back more than 15% of its water usage. He explained that the impact of not
responding to prolonged inflation through an upward rate adjustment would be future
reductions in capital spending, reduced reserves, and a more dramatic rate increase in future
years. He provided a brief overview of the concept of pass-thru rates for water supply costs
and detailed how other cities are utilizing them. City Manager Leung confirmed a Wastewater
Rate Study will be conducted next year. Utilities Director Vukojevic advised the rates for
wastewater will increase by 2% in January.
Committee Member Collopy inquired if an assumed rate of inflation was baked into the rates
since 2019. Utilities Director Vukojevic confirmed they were baked into the rates. Committee
Member Collopy recommended accelerating the next rate study by one year.
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Budget Manager Burguan provided a brief overview of the Capital Improvement Program (CIP)
Budget over the last five years and noted the proposed CIP for Fiscal Year 2022-23 is $71
million.
Budget Manager Burguan provided a brief overview of the General Fund Budget and reported
General Fund Revenues are projected to surpass staff expectations and pre-pandemic
projections. She advised the City’s Sales Tax consultant has projected an increase of $1.2
million in Sales Tax. She reported Salaries and Benefits are the largest General Expenditure
at $163.4 million.
Finance Director/Treasurer Catlett provided an overview of the staff’s efforts to enhance
budgeting accuracy.
Chair O’Neill inquired why the City has seen significant revenue and expenditure growth year
after year considering it has not increased the Transient Occupancy Tax (TOT), Sales Tax, or
Property Tax rates as many other jurisdictions have. Finance Director/Treasurer Catlett
explained that a good portion of the expenditure growth in excess of other jurisdictions is due
to the City’s significant increased contribution to CalPERS to pay down the City’s UAL. He
noted he believes revenue is growing at an accelerated rate due to significantly increased
coastal property values, an uptick in business activity combined with the City’s role as a
regional retail center, and an increase in the prevalence of short-term rentals and higher
occupancy and dates for both short-term rentals and hotels.
Council Member Avery noted this is a housing market that has historically not been seen and
the City is a safe place to invest when buying a home.
Finance Director/Treasurer Catlett noted the City was able to taper the use of discretionary
funds during the pandemic, which provided flexibility to avoid any service level reductions.
Council Member Avery inquired about the risk of a downturn impacting property tax revenues.
Finance Director/Treasurer Catlett noted that due to the growth seen from reassessed
properties, even if sales decline these often significant reassessments result in rising property
tax revenues.
Committee Member Scarbrough inquired if the City is tracking Sales Tax revenue trends due
to increasing inflation. Finance Director/Treasurer Catlett advised staff meets quarterly with its
Sales Tax consultant and the impact of inflation has been a topic of conversation at the most
recent meetings.
Committee Member Collopy noted the City has a robust increase in expenditures. Finance
Director/Treasurer Catlett explained the operating budget growth is primarily driven by the
proposed increased UAL payment, increased transfers to ISFs, removal of the vacancy factor,
and budget accuracy-related adjustments that will be discussed in more detail later in the
presentation.
Committee Member Collopy noted there was $4.4 million in expenditure savings and advised
it should be a City Council decision to budget to full employment or probable employment.
Chair O’Neill advised City Council has been working through that policy since 2015 and noted
when the budget is tight the City Council can budget towards probable employment and budget
to full employment when the budget is full.
Finance Director/Treasurer Catlett clarified the $4.4 million in expenditure savings includes
$2.4 million in salary savings, $2.1 million in contracts, and the remainder in miscellaneous
expenditures. He clarified the only new spending included in the budget is for the Program
Enhancements and the Be Well OC contract continuation. He presented an overview of
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General Fund Expenditures by Department and General Fund Transfers. He highlighted the
addition of the Tidelands subsidy transfer per a recent Finance Committee discussion and the
transfer to the Fire Equipment Fund for a program enhancement.
Finance Director/Treasurer Catlett provided a brief overview of the General Fund Internal
Service Fund Charges and explained the insurance charges are increasing due to increasing
excess insurance premiums and the elimination of the fund balance drawdown included in last
fiscal year’s budget. He reported the budget as proposed has a $9.7 million structural surplus.
He advised the current year's projected surplus of $15.8 million will need to be partially
allocated to maintain the contingency reserve at 25%. In response to Committee Member
Collopy’s inquiry, he explained how the surplus funds accumulated from fiscal year to fiscal
year. He advised that any surplus funds would be allocated to neighborhood enhancements
and paying down long-term obligations as per Council Policy F-5. He noted that $8.6 million
could be used to fully fund the remaining components of the Balboa Island drainage project or
$5.7 million could be used to eliminate the City’s unfunded Other Post-Employment Benefits
(OPEB) liability. He noted the City Council would determine how to spend the funds.
Chair O’Neill noted this is General Fund money that can be used on anything and advised the
City has never had this option before.
Committee Member Scarbrough recommended using the funds towards affordable housing to
get the State off of the City’s back.
Committee Member Collopy recommended reducing taxes. Chair O’Neill advised the City
Council cannot reduce Property or Sales Taxes because the City does not currently have any
add-on taxes above the minimum rate set by the State.
Committee Member Collopy suggested a moratorium on the new recycling fee for residents.
Chair O’Neill recommended the Finance Committee go through the budget and identify
targeted revenue reductions that may benefit residents.
Committee Member Reed encouraged the Finance Committee to set aside the CIP funding
until construction materials are less expensive. Chair O’Neill concurred. Mayor Pro Tem Blom
noted this is not the time to spend and there will be long-term costs.
Finance Director/Treasurer Catlett provided a brief overview of program enhancements and
staffing changes. He advised this includes funding the Police Department body-worn camera
program, taser replacement program, enhanced internal service fund allocations, and one
additional Community Services Officer position. He noted that $1 million will be used for
addressing homelessness.
Finance Director/Treasurer Catlett provided a brief overview of Capital purchases and other
material miscellaneous enhancements recommended by staff.
Committee Member Scarbrough inquired how surplus vehicles are determined. Finance
Director/Treasurer Catlett explained the process.
Finance Director/Treasurer Catlett provided a brief overview of changes in full-time staffing
from 2009 through 2020. He advised total staffing levels, including part-time employees, in the
City remain 7.4% below the 15-year peak in 2009. He explained some part-time employees
become eligible for CalPERS membership but are not eligible for the same benefits as full-time
employees, which then creates recruitment and retention challenges. He advised staff is
proposing a limited program to convert part-time positions to full-time positions and provided a
list of those positions.
City Manager Leung explained the current labor market is very challenging and competitive.
She noted there are currently 50 open recruitments. She explained some of the positions have
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become a training ground where the staff member can get trained and move to another agency
full-time which is creating challenges.
Committee Member Stapleton inquired if any full-time staff was being added to the Harbor
Department. City Manager Leung advised the Harbormaster has asked for additional positions
and noted a staffing study was being conducted to determine what makes sense for the long
term.
Committee Member Reed inquired what the cost is to the City of staff members who are leaving
after being trained. City Manager Leung advised she has not quantified those numbers.
Community Development Director Seimone Jurjis explained they are struggling with the talent
pool. He noted training for an Inspector requires over one year.
Mayor Pro Tem Blom noted the current goal is employee retention.
Committee Member Collopy inquired if 50 vacancies mean the City is understaffed by 50
positions. City Manager Leung concurred and noted the City has average recruitment for 30
positions at any given time.
Finance Director/Treasurer Catlett provided a brief overview of proposed additional staffing,
new positions, and reclassifications. He advised the program enhancements total $4.2 million
of which $4.1 million is from the General Fund.
Finance Director/Treasurer Catlett provided a brief update on the City’s Unfunded Pension
Liability. He reported the 21.3% investment return in Fiscal Year 2020-21 has significantly
reduced the City’s unfunded liability. He noted the City is approaching 50% of employees being
covered by the Public Employees' Pension Reform Act (PEPRA) pension formulas, which has
also been helpful. He explained the Finance Committee endorsed a $35 million base
contribution to the unfunded liability. He advised that given the City’s recent revenue growth,
staff recommends maintaining a $40 million per year payment from the baseline budget until
the unfunded liability is eliminated. He noted this change would fully fund the liability in 2029,
or 2028 if the payment was increased to $45 million through continued allocations of $5 million
from year-end surplus.
Committee Member Collopy noted a 6.8% discount rate is aggressive after the 21.3%
investment return. He also noted it is not an additional $5 million at the end of 2023 but an
additional $10 million due to City Council policy because a $20 million surplus is anticipated.
Finance Director/Treasurer Catlett advised last year the City Council waived the surplus
utilization policy and allocated additional funds to the Facilities Financial Plan (FFP) in lieu of
an additional contribution to CalPERS.
Chair O’Neill noted a $20 million surplus assumes the City Council will not allocate the $9.7
million. He referenced some projects that could be accelerated. He believes the City Council
will allocate the $9.7 million.
Committee Member Collopy recommended the Finance Committee keep in mind that the
largest capital expense for the City in the future is the police station. He recommended using
some of the surplus funds to fund that expense.
Finance Director/Treasurer Catlett advised the police station is fully funded in the FFP but could
be impacted by inflation. Chair O’Neill confirmed the City is looking to buy a parcel for the police
station.
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Committee Member Scarbrough suggested the Finance Committee keep in mind that they do
not know how affordable housing changes such as Accessory Dwelling Units and Senate Bill
9 will impact the City.
Finance Director/Treasurer Catlett reported the General Fund budget is balanced with
increased accuracy and results in a $9.7 million surplus.
Committee Member Scarbrough inquired if there has been any discussion of a program from
CalPERS to assist jurisdictions with reducing their UALs. Finance Director/Treasurer Catlett
advised he had not heard of such a program but believes that if such a program is created
there would likely be some socio-economic criteria for which agencies would be eligible for that
program that would likely result in the City not being eligible for participation.
Chair O’Neill opened public comments.
Charles Klobe inquired about the 31% increase in expenditures for the City Manager’s Office
and the 8.2% for the City Council. Finance Director/Treasurer Catlett explained the City
Manager increase is for Be Well OC program and the City Council is for the ISF charges.
Mr. Mosher inquired if the fire station's early warning system includes an early warning
earthquake system. He expressed surprise that vehicles are being auctioned as soon as they
reach the end of their useful life and thought they would be assessed at the end of their useful
life. He asked for clarification if the Be Well OC program is funded by a grant program and
inquired about the anticipated time the budget book will be posted on the City’s website.
Chair O’Neill closed public comments.
Finance Director/Treasurer Catlett confirmed the City Council increase was due to the increase
in ISF charges.
Chair O’Neill clarified the Fire Department did not move forward with the early warning
earthquake system.
Finance Director/Treasurer Catlett clarified vehicles are kept longer if they are not used
regularly and noted there are vehicles in the fleet that are five years beyond their useful life
date. He confirmed the City did receive some grant funding for the Be Well OC Program but
clarified that $400,000 to $500,000 was from the General Fund. He explained the City will fund
100% of the cost moving forward from the General Fund. He advised the budget book will be
made available on the City’s website at the same time it is provided to the Finance Committee.
Committee Member Collopy requested the Finance Committee receive their budget book
before the May 12 meeting for review.
The item was received and filed.
B. OPEB ACTUARIAL VALUATION REPORT UPDATE
Summary:
Staff will provide the Committee with an overview of the latest actuarial valuation report
prepared by the City's actuary.
Recommended Action:
Receive and file.
Finance Director/Treasurer Catlett presented the OPEB Actuarial Valuation Report Update to
the Finance Committee. He explained there is no requirement to pre-fund long-term OPEB
costs, but the City has voluntarily chosen to do so as is a best practice under sound financial
management principles. He advised City Council Reserve Policy F-2 includes a requirement to
pre-fund the explicit portion of the Actuarial Accrued Liability (AAL) over a 20-year amortization
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period or less. He provided a brief recap of the January 2020 Finance Committee discussion
where the staff recommendation was to lower the discount rate from 6.5% to 5.5%
Finance Director/Treasurer Catlett reported the California Employers' Retiree Benefit Trust
(CERBT) Strategy 1 earned returns of 27.43% in Fiscal Year 2020-21. He provided a brief
overview of the OPEB Benefit Plan.
Committee Member Collopy inquired if the discount rate was 5.5%. Finance Director/Treasurer
Catlett explained the rate recommended by the City’s actuary and utilized to calculate the
unfunded liability is 6.5%, but the rate was artificially reduced to 5.5% for purposes of
calculating the required contribution. Staff is recommending it go back to 6.5% for funding
purposes.
Finance Director/Treasurer Catlett provided a brief overview of the CERBT program including
an overview of the historical performance of the City’s Trust Account.
Committee Member Collopy inquired if the City could contribute a larger amount to OPEB in a
single year than what is recommended by the actuary. Finance Director/Treasurer Catlett
confirmed the City can contribute as much as it would like, and the City Council could choose
to eliminate the unfunded liability at any time.
Finance Director/Treasurer Catlett reported the Actuarially Determined Contribution (ADC) is
increasing by 5.7% or $235,000. He presented a projection of the future amortization of the
unfunded liability and noted the City’s actuary projects that the unfunded OPEB liability will be
eliminated by Fiscal Year 2028-29. He explained staff’s recommendation is to put the discount
rate back to 6.5% and to consider contributions from surplus funds under City Council Policy
F-5 to eliminate the liability.
Finance Director/Treasurer Catlett provided a brief overview of explicit and implicit subsidies.
He explained upon implementation of GASB Statement No. 75, the Governmental Accounting
Standards Board required that the future value of the implicit subsidy be included in the City’s
OPEB liability. He indicated that the implicit subsidy is imbedded in the City’s insurance rates
for active employees and that it is unnecessary to prefund for these operating costs related to
employees’ current service. He advised staff’s recommendation is to contribute toward the
unfunded liability up to an amount equal to the total explicit liability, while leaving the implicit
subsidy liability unfunded. He also advised the downside of leaving the $8 million implicit
subsidy liability unfunded is that this amount will remain on the City’s balance sheet
permanently.
Committee Member Collopy inquired why the $8 million would remain on the City’s balance
sheet. Finance Director/Treasurer Catlett explained staff recommends funding to $40 million
not $50 million. Since funding the additional portion of the liability would result in the need to
routinely draw down funds from the trust to pay current costs for active employees’ health
insurance. He requested the Finance Committee’s guidance on whether it is preferred to target
funding at 100% of the explicit subsidy liability or 100% of the total OPEB liability. He explained
that following City Council Policy F-2 would result in the implicit subsidy liability remaining on
the City’s statement of net position.
Finance Director/Treasurer Catlett summarized that staff recommends returning the discount
rate from 5.5% to 6.5%, remaining in CERBT Strategy 1, based on the Finance Committee’s
feedback either setting the target funding level equal to the explicit subsidy liability or the total
OPEB liability with an amendment to City Council Policy F-2, remitting the net $525,000
balance on hand in the OPEB ISFs to CERBT as a one-time additional contribution, and
returning to the Finance Committee annually with an OPEB Update.
Committee Member Collopy inquired if moving the discount rate from 5.5% to 6.5% impacts
the numbers of years until full funding will be reached. Finance Director/Treasurer Catlett
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assumes that is the case but will confirm with the Actuary. He further explained that the City
Council under Policy F-5 may still contribute additional resources to the unfunded OPEB
liability, which would reduce the time until full funding is reached.
Committee Member Collopy inquired if the City could do both.
Chair O’Neill noted the OPEB liability is not a large debt for the City because it is a closed
system. He noted no one will understand OPEB. He noted the Finance Committee could
recommend paying it off completely. He recommended keeping the course of moving the
discount rate from 5.5% to 6.5%.
Finance Director/Treasurer Catlett provided a brief overview of current and proposed OPEB
accounting. He advised the staff recommends remitting the $500,000 to CERBT as a one-time
additional contribution.
Chair O’Neil opened public comments.
Mr. Klobe recommended the City pay off OPEB and no longer spend time on it at the Finance
Committee.
Chair O’Neill closed public comments.
Finance Director/Treasurer Catlett requested guidance from the Finance Committee that it
makes sense to target funding the explicit liability only. The dais concurred.
The item was received and filed.
C. BUDGET AMENDMENTS FOR QUARTER ENDING MARCH 31, 2022
Summary:
Staff will report on the budget amendments from the prior quarter.
Recommended Action:
Receive and file.
Committee Member Collopy inquired about the rationale behind Budget Amendment Nos. 36
– 38. Finance Director/Treasurer Catlett explained the City has a long-standing policy of not
presuming the results of negotiations with contracts and noted lump-sum payments were
included in those agreements. He advised they were not included in the adopted budget as the
Cost of Living Adjustment (COLA) amounts for the agreements were not known at the time.
Committee Member Scarbrough inquired why this item did not come up on the City Council’s
consent calendar. City Manager Leung explained the budget amendments are included in the
approval of the labor contracts and are attached to the related staff reports.
Chair O’Neill called for public comments and hearing none, closed public comments.
The item was received and filed.
D. WORK PLAN REVIEW
Summary:
Staff and Finance Committee to review the proposed work plan and identify matters that
members would like placed on a future Agenda for discussion, action, or report.
Recommended Action:
Receive and file.
Chair O’Neill reported the meeting on May 12, 2022, will include a follow-up discussion on the
budget and is also the date the Finance Committee will receive their budget books.
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Finance Director/Treasurer Catlett explained there is a billing issue with Recycle Only bills and
Sewer Only bills. He advised staff will be bringing forward an item to change the strategy to
place those charges on the Property Tax roll.
City Manager Leung advised the City is spending a lot of money trying to collect the funds and
it makes sense to move it to the Property Tax bill. The dais agreed it did not need to come to
the Finance Committee.
Chair O’Neill advised the joint City Council-Finance Committee Study Session will be held on
May 24, 2022, at 4:00 p.m. He noted the Finance Committee will meet on May 26, 2022, to
make its final recommendation to the City Council on the budget.
Committee Member Collopy inquired if the City Council will be able to see budget data before
May 24, 2022. Chair O’Neill advised the City Council will be able to review the proposed budget
online. Committee Member Collopy recommended the Finance Committee make the City
Council aware the budget book is available for review.
Chair O’Neill called for public comments and hearing none, closed public comments.
The item was received and filed.
VI. ADJOURNMENT
The Finance Committee adjourned at 5:09 p.m. to the next regular meeting of the Finance
Committee.
The agenda for the Regular Meeting was posted on April 8, 2022, at 4:18 p.m., in the binder and
on the City Hall Electronic Board located in the entrance of the Council Chambers at 100 Civic
Center Drive.
Attest:
___________________________________ _____________________
Will O’Neill, Chair Date
Finance Committee
12
CITY OF NEWPORT BEACH
FINANCE COMMITTEE
STAFF REPORT
Agenda Item No. 5A
May 12, 2022
TO: HONORABLE CHAIRMAN AND MEMBERS OF THE COMMITTEE
FROM: Finance Department
Scott Catlett, Finance Director/Treasurer
949-644-3123, scatlett@newportbeachca.gov
SUBJECT: REVIEW OF INVESTMENT PORTFOLIO STRATEGY AND
BENCHMARK
SUMMARY:
The City has employed the same investment strategy for its externally managed
investment portfolio since inception in 1993. This report provides options for implementing
alternative investment strategies that will result in additional investment income for the
City with minimal additional risk.
RECOMMENDED ACTION:
Provide feedback to staff regarding changing investment strategies.
DISCUSSION:
In November 2017, the City consolidated its investment management services with a
single investment advisory firm – Chandler Asset Management (Chandler). Chandler had
been one of the City’s advisors under the prior investment management contracts and
has served the City for decades. Chandler is currently responsible for managing both the
City’s marketable securities portfolio and its targeted maturities portfolio. As of March 31,
2022, the City’s investment portfolio included the following components:
Portfolio Component Managed By Amount
Cash in Banks City Staff $ 14,719,000
Local Agency Investment Fund (LAIF) City Staff 31,092,000
Targeted Maturities Portfolio Chandler 23,978,000
Marketable Securities Chandler 271,675,000
Total $ 341,464,000
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Review of Investment Portfolio Strategy and Benchmark
May 12, 2022
Page 2
As can be seen in the table, the majority of the City’s funds are managed by Chandler.
City staff analyze cash flows and maintain adequate funds between bank accounts and
LAIF to meet liquidity needs. Funds that will be needed for liquidity purposes, but not for
some time, are invested in the Targeted Maturities Portfolio, which is very short-term in
nature but has a higher yield than LAIF. This investment option is, for example, utilized
when the City receives the two larger property tax payments in December and April and
then draws down those funds for operations in subsequent months. The remaining $272
million managed by Chandler and invested in marketable securities is rarely if ever
accessed by the City and over time has continued to grow as the City’s various savings
programs such as the Facilities Financing Plan and Harbor and Beaches Master Plan
were implemented and funded. While there will be an occasional need to access the
marketable securities portfolio over time for specific situations such as large capital
projects, those events are rare and can be anticipated via the City’s cashflow analysis
process so that funds can be moved out of the marketable securities portfolio to LAIF as
individual securities mature. Only in the very unlikely event of the City’s response to an
unanticipated natural disaster requiring a sizable draw on the contingency reserve would
there be a need to access these funds with little notice.
The California Government Code, as well as the City's Investment Policy and benchmark
selection, set the parameters within which Chandler must operate when investing the
City's funds. Upon initially contracting with Chandler, a one to three-year benchmark was
selected against which to measure the performance of the Chandler-managed portfolio.
This selection was made based on the desire for a very conservative investment strategy
in the aftermath of the Orange County bankruptcy. Chandler currently terms this strategy
its “Limited Maturity” strategy, which has an average duration (a measure of interest rate
risk) of 1.77 and a yield to maturity (the rate of return if the securities are held until
maturity) of 2.10% as of the first quarter of 2022. Key facts about this strategy are
illustrated in the below charts.
This strategy utilizes the ICE Bank of America 1-3 Year US Treasury Index as its
benchmark and is designed to invest primarily in US Treasuries, federal agencies, and
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Review of Investment Portfolio Strategy and Benchmark
May 12, 2022
Page 3
investment grade corporate bonds rated “A” or above, with 71% of the current portfolio
composition in US Treasury and agency securities and 18% in corporate bonds. Only
11% of the securities in the strategy have a maturity of more than three years.
As an alternative to the current strategy, Chandler offers an investment strategy tied to a
one to five-year benchmark that they term their “Short Term Bond” strategy. This strategy
is still conservative and fully compliant with the City’s investment policy and the limitations
prescribed in the California Government Code, but has an average duration of 2.48 and
a yield to maturity of 2.36% as of the first quarter of 2022. Key facts about this strategy
are illustrated in the below charts.
This strategy utilizes the ICE Bank of America 1-5 Year US Treasury and Agency Index
as its benchmark and is designed to invest primarily in US Treasuries, federal agencies,
and investment grade corporate bonds rated “A” or above, with 56% of the current
portfolio composition in US Treasury and agency securities and 25% in corporate bonds.
Nearly 38% of the securities in this strategy have a maturity between three and five years.
While the current difference between the yield to maturity of these strategies is 0.26%,
this differential can fluctuate depending on market conditions. At the current differential,
changing investment strategies would yield an additional $706,000 of annual investment
income for the City. It should also be noted that Chandler offers a strategy that blends
the Limited Maturity and Short-Term Bond strategies with a duration and yield somewhere
in the middle of the two strategies for clients whose risk tolerance lies somewhere
between the two strategies.
Making a change in the City's investment strategy and benchmark is within the authority
delegated to the City Treasurer by the City Council and selection of an alternative strategy
would be fully compliant with the existing City Council-approved Investment Policy F-1.
However, this change in strategy does come with some caveats that should be evaluated
before a change is made. Specifically, certain liquidity, market volatility, and interest
income considerations must be understood prior to making such a decision. Staff,
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Review of Investment Portfolio Strategy and Benchmark
May 12, 2022
Page 4
therefore, brought this item to the Finance Committee for their feedback on and
concurrence with the change prior to moving forward.
Analysis
Beyond just serving as a method to measure performance against, a benchmark guides
Chandler's investment strategy as they try to match the composition of the benchmark in
the City's portfolio. The benchmark, therefore, serves as an objective standard against
which to measure and evaluate the relative performance of the City's investment portfolio.
The selection of a benchmark must take into consideration the City's liquidity needs, its
tolerance for short-term reductions to the market value of the investment portfolio, and its
tolerance for swings in paper interest income (as opposed to actual cash interest
earnings) from year to year. It should also be noted that there is no one investment
strategy that will provide the best performance under all market conditions. However, in
the long-term, investing against a longer-term benchmark has the potential to increase
investment earnings and is a strategy that is employed by many of Chandler’s clients, in
particular clients like the City who have robust cashflow management programs in place
that minimize the likelihood of needing to sell securities prior to maturity.
If yield is the only criteria, then a one to five-year investment strategy would make the
most sense. However, there is a noteworthy aspect to the longer-term investment strategy
that if not properly understood could be a cause for concern. Switching to this strategy
can result in more sizable drops in the book value of the City's investment portfolio and
paper losses ("total returns") that are more significantly negative when interest rates rise.
These are then offset by paper gains and increases in the market value of the portfolio
that are also more significantly positive when interest rates decline. The key concept to
understand is that these paper losses and gains are irrelevant, provided that the City
holds its investments until maturity (or until an opportunity for a trade that makes
economic sense presents itself). In the event that the City ever had to sell securities prior
to maturity due to unanticipated liquidity needs, the real losses (or gains) would be larger
than they would be with a one to three-year strategy due to the longer-term nature of the
investments. However, it is important to recognize that such losses would exist in either
scenario.
In addition to the liquidity concern, the other concern is that accounting guidance requires
that the paper losses and gains be booked each year. Therefore, there will be years in
which the City records higher or lower investment earnings in its financial statements than
the actual cash earnings received. This is the case now with the one to three-year
benchmark, but the effect will be more pronounced with a one to five-year benchmark.
These variances eventually net out, and the higher cash earnings under the one to five-
year benchmark eventually are recorded in the City's financial statements and will yield
higher long-term earnings as described earlier in this report. If interest revenue was a
significant component of the City's revenue budget, this could be a cause for concern.
However, interest revenue makes up less than 1% of the General Fund revenue budget
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May 12, 2022
Page 5
and staff believes that it is worth weathering these variances with the higher long-term
interest earnings in mind.
Based upon all of these considerations, it is staff's recommendation to move to a one to
five-year investment benchmark. Over the long-term, the potential for additional
investment earnings is significant, which can be utilized to provide additional services to
the City's residents, pay down unfunded liabilities, and/or fund capital projects.
Prepared and Submitted by:
/s/ Scott Catlett
_____________________________
Scott Catlett
Finance Director/Treasurer
17
1
CHANDLER ASSET MANAGEMENT, INC. | 800.317.4747 | www.chandlerasset.com
INVESTMENT REPORT
Period Ending April 30, 2022
City of Newport Beach
SECTION 1 Transitioning to a Longer Strategy
SECTION 2Economic Update
SECTION 3Account Profile
SECTION 4 Consolidated Information
SECTION 5 Portfolio Holdings
SECTION 6 Transactions
Table of Contents As of April 30, 2022
1
1
2
2
SECTION |Section 1 |Transitioning to a Longer
Strategy
Transitioning to a Longer Investment Strategy
Opportunity
•The recent increase in interest rates provides the City with an opportunity to increase future
earnings by transitioning to a longer strategy.
•Longer duration strategy returns have historically had higher returns than shorter duration
strategies but with higher volatility.
Transition
•We would transition the portfolio over the next six months. This approach would allow the
City to use upcoming maturities to purchase longer term securities and align the portfolio
with the new strategy targets.
Index As of April 30, 2022 Duration Yield
ICE BofA 1‐3 Year US Treasury & Agency Index 1.77 2.58%
ICE BofA 0‐5 Year US Treasury Index 2.03 2.38%
ICE BofA 1‐5 Year US Treasury & Agency Index 2.50 2.71%
3
3
4
3
Historical Yields of the Indices
0
0.5
1
1.5
2
2.5
3
3.5
ICE BofA 1‐3 Yr US Treasury & Agency Index
ICE BofA 0‐5 Yr US Treasury Index
ICE BofA 1‐5 Yr US Treasury & Agency Index
Source: Bank of America Merrill Lynch Indices
4
Adding Value and Controlling Risks
Positioning securities along the yield curve to capture value across
maturities
PortfolioDuration
SectorAllocation
Term Structure
Security
Selection
Constraining portfolio duration relative to benchmark duration
Strategic allocations to key sectors, with value‐based rotation
Selecting bonds that we believe are undervalued and offer the
greatest potential for risk‐adjusted return
Four Key Elements of Our Approach
5
5
6
4
Consistent, Stable, Risk‐Adjusted Returns
Tightly controlled duration, sector allocation, term structure and security selection
As of April 30, 2022 One
Year
Three
Years
Five
Years
Ten
Years
ICE BofA 1‐3 Year US Treasury & Agency Index ‐3.34% 0.65% 0.95% 0.79%
ICE BofA 0‐5 Year US Treasury Index ‐3.73% 0.66% 0.99% 0.87%
ICE BofA 1‐5 Year US Treasury & Agency Index ‐4.68% 0.58% 0.92% 0.91%
Performance
Source: Bank of America Merrill Lynch Indices
6
Understanding Risk and Return for Select Strategies
Annual Benchmark Study
Period Ending December 31, 2021
ICE BofA 1‐3 Yr
US Treasury & Agency Index
ICE BofA 0‐5 Yr
US Treasury Index
ICE BofA 1‐5 Yr
US Treasury & Agency Index
0‐6 months 9.49%
6‐12 months 11.97%
1‐3 years 100.00%48.85%62.17%
3‐5 years 29.68% 37.84%
5‐10 years
Treasury 96.64% 100.00% 96.58%
Agency 3.36% 3.42%
Corporate
Modified Duration 12/31/2021 1.82 2.11 2.57
10 Year Annualized Total Return 1.10% 1.22% 1.35%
10 Year Standard Deviation 1.28% 1.47% 1.68%
Sharpe Ratio 0.22 0.27 0.32
Qualitative Risk Objective 12/31/2002 ‐12/31/2021 12/31/2005 ‐12/31/2021 12/31/2001 ‐12/31/2021
Negative Quarterly Return Occurrences 14 16 19
2 Consecutive Negative Quarterly Return
Occurrences 322
Negative Return For Year Occurrences 122
Worst Year Total Return ‐0.55%‐0.85% ‐1.09%
Source: ICE BofA Indices. Index returns assume reinvestment of all distributions. Historical performance results for investment indexes generally do not reflect the deduction of transaction and/or custodial
charges or the deduction of an investment management fee, the incurrence of which would have the effect of decreasing historical performance results. It is not possible to invest directly in an index. Pleasesee disclosures at the end of this presentation.
7
7
8
5
Benchmark Comparison
Source: Bank of America Merrill Lynch Indices
$1.00
$1.02
$1.04
$1.06
$1.08
$1.10
$1.12
$1.14
$1.16
$1.18
$1.20
GrowthICE BofA 1‐3 Year US Treasury & Agency Index
ICE BofA 0‐5 Year US Treasury Index
ICE BofA 1‐5 Year US Treasury & Agency Index
3/31/2022
ICE BofA 1‐3 Year US Treasury & Agency Index $272,401,928 0.86%
ICE BofA 0‐5 Year US Treasury Index $275,502,742 0.98%
ICE BofA 1‐5 Year US Treasury & Agency Index $277,182,187 1.04%
Value on 3/31/2022 of $250 million invested 3/31/2012
Annualized Return
8
Section 2|SECTION |Section 2 |Economic Update
9
10
6
Economic Update
Financial markets are experiencing heightened volatility and tighter conditions as central banks employ more restrictive
monetary policies to combat persistent inflation. Risk assets have sold off, and bond returns have been negatively
impacted by the dramatic rise in rates. The conflict between Russia and Ukraine has exacerbated inflationary pressures,
particularly with energy and commodities, and shows no sign of abating in the short run. Additionally, strict COVID
lockdowns in China are intensifying distressed supply chains. While labor markets and consumer spending remain strong,
we believe the risk of an economic slowdown later this year has increased. Although we expect the Fed to continue to
tighten monetary policy, the FOMC has very little margin for error as it attempts to combat inflation without pushing the
economyinto arecession. Overthe near‐term, we expect financial market volatility to remain intensified and conditions to
remain tighter with persistent inflation, geopolitical risk, supply chain bottlenecks, and the Fed's shift to a more hawkish
monetary policy.
As expected at theMay meeting,the Federal Open MarketCommittee (FOMC)announced itwould raisethe federal funds
rate by 0.50% to a range of 0.75%‐1.00% and begin shrinking its $9 trillionbalance sheetstarting June 1st. Federal Reserve
Chair Powell indicated that a 75 basis point increase is not currently under consideration, and the Treasury yield curve
steepened after the announcement. We are anticipating additional rate hikes by the Fed in the near term, but we do not
believe thatmonetary policy is notonapre‐setcourse and the timingandmagnitude of rate hikes in the second half of this
year will be dependent on how economic and geopolitical conditions continue to transpire.
In April, yields continuedto rise and the curve steepened. The 2‐yearTreasury yieldincreased 38basis points to 2.72%, the
5‐year Treasury yield increased 50basis points to 2.96%, and the 10‐year Treasury yield increased60 basis points to2.94%.
The spreadbetweenthe 2‐yearand 10‐yearTreasury yieldincreased to22 basispoints atApril month‐endversus zerobasis
points at March month‐end, but down from 147 basis points one year ago. While the flat yield curve bears watching over
the longer run, the spread between 3‐month and 10‐yeartreasuries isstill steepat about210basispoints, whichindicates
likely economic growth in the coming year.
10
Source: US Department of Labor Source: US Department of Labor
Employment
The U.S. economy added 428,000jobs in April, with downward revisions from the prior months totalling39,000. Trends in employment remain
strong, with the three‐month moving average payrolls at 535,000and the six‐month moving average at 558,000. Job gains were broad based in
April, led by leisure and hospitality, manufacturing, and transportation and warehousing. The unemployment rate remained unchanged at
3.6%, and average hourly earnings rose 5.5% year‐over‐year inApril, slightlylower thanthe 5.6%reading inMarch. Thelabor participationrate
fell to 62.2% in April from 62.4% in March as labor shortages continue and workers remain on the sidelines.
‐22,000
‐18,000
‐14,000
‐10,000
‐6,000
‐2,000
2,000
6,000
MOM Change In (000's)Nonfarm Payroll (000's)
Non‐farm Payroll (000's)
3 month average (000's)
0.0%
4.0%
8.0%
12.0%
16.0%
20.0%
24.0%
Unemployment Rate
Underemployment Rate (U6)
Unemployment Rate (U3)Rate (%)11
11
12
7
Source: US Department of Labor Source: US Department of Commerce
Inflation
AlthoughU.S.consumerpricesroselessthanexpectedinMarch,inflationremainedelevatedata40‐yearhigh. The ConsumerPrice Index (CPI)
was up 8.5% year‐over‐year in March, versus up 7.9% year‐over‐year in February. Core CPI (CPI less food and energy) was up 6.5% year‐over‐
year in March, versus up 6.4% year‐over‐year in February. Gasoline costs drove about half of the monthly increase, while food was also a
sizablecontributor. Usedvehicle pricesdeclined (althoughremaining firm),resulting inlower thanforecast coreincreases forthe month.The
Personal ConsumptionExpenditures (PCE) index was up6.6% year‐over‐yearin March, up from 6.3% year‐over‐yearin February. Core PCEwas
up 5.2% year‐over‐yearinMarch, versus up5.3% inFebruary. Currentinflation readings continue torun well above the Fed’s longer‐run target
of around 2.0%. Accelerating labor costs and healthy consumer spending continue to drive inflationary pressures. Additionally, the Russia‐
Ukraine war and COVID lockdowns in China continue to exacerbate commodity prices and supply chain challenges.
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
7.0%
8.0%
9.0%
Personal Consumption Expenditures (PCE)
PCE Price Deflator YOY % Change
PCE Core Deflator YOY % Change
YOY( %) Change0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
7.0%
8.0%
9.0%
Consumer Price Index (CPI)
CPI YOY % Change
Core CPI YOY % Change
YOY( %) Change12
Retail sales edged higher in March, butthere are signs thathigher gasprices are impacting discretionary spending. Ona year‐over‐yearbasis,
retail sales were up 6.9% in March versus up 18.2% in February. On a month‐over‐month basis, retail sales moderated, rising 0.5% in March
versus anupwardly revised increase of 0.8% inFebruary. Excludingvehiclesand gas, retail sales were upjust 0.2% month‐over‐month. Gains in
March were driven primarily by gasoline purchases, while e‐commerce and vehicle sales declined. Although inflation threatens to put a dent in
expected growth, we believe highlevels of consumer savingsalong with improvement inthe health situation and continued improvementin
the labormarketshould provide a healthy tailwind forconsumer spending. The ConsumerConfidence index fell slightly to 107.3in April from
an upwardly revised 107.6 in March. While consumers’ evaluations of the present situation weakened, future expectations picked up.
Source: US Department of Commerce Source: The Conference Board
‐30.0%
‐20.0%
‐10.0%
0.0%
10.0%
20.0%
30.0%
40.0%
50.0%
60.0%
Retail Sales YOY % Change
YOY (%) Change80
90
100
110
120
130
140
Index LevelConsumer Confidence
Consumer
13
13
14
8
Source: The Conference Board Source: Federal Reserve Bank of Chicago
Economic Activity
The Conference Board’sLeadingEconomicIndex (LEI) increased 0.3% month‐over‐month inMarch, followinga 0.6% upwardly revisedincrease
in February. On a year‐over‐yearbasis, the LEI wasup 6.4% in Marchversus up7.3% inFebruary. Resultsindicated broad‐based improvement,
pointing toward US growth throughout 2022 in spite of the headwinds of the war, weakening consumer and business sentiment, and market
volatility. Meanwhile, the Chicago Fed National Activity Index (CFNAI) fell to 0.44 in March from 0.54 in February. On a 3‐month moving
average basis, the CFNAI rose to 0.57 in March, while February was revised upward to 0.43.
‐8.00
‐6.00
‐4.00
‐2.00
0.00
2.00
4.00
6.00
Chicago Fed National Activity Index (CFNAI)3 Month Average‐8.0%
‐6.0%
‐4.0%
‐2.0%
0.0%
2.0%
4.0%
Leading Economic Indicators (LEI)MOM ( %) Change14
Source: US Department of Commerce Source: S&P
Housing
0
200
400
600
800
1000
1200
1400
1600
1800
2000
MOM Change (In Thousands of Units)Housing Starts
Multi Family Housing Starts
Single Family Housing Starts
0.0%
3.0%
6.0%
9.0%
12.0%
15.0%
18.0%
21.0%
24.0%
S&P/Case‐Shiller 20 City Composite Home Price Index YOY( %) ChangeTotal housing starts rose 0.3% to an annual rate of 1,793,000 in March. Single‐family starts fell by ‐1.7% and multi‐family starts rose 4.6%,
month‐over‐month. On ayear‐over‐yearbasis, total housingstartsincreased 3.9%, drivenby multi‐family. Accordingtothe Case‐Shiller20‐City
home price index, home prices were up 20.2% year‐over‐year inFebruary versusup 18.9% in January, setting anew record. While tightsupply
has continued to support prices, rising mortgage rates and affordability could be headwinds to further price growth.
15
15
16
9
Source: Institute for Supply Management Source: Federal Reserve
Manufacturing
The Institute for Supply Management (ISM) manufacturing index fell unexpectedly to 55.4 in April from 57.1 in March, hampered by labor
shortages and lingering supply chain constraints. Growth in orders, production and employment softened, indicating a shift in consumer
spendingfrommerchandise toservices. Readingsabove 50.0are indicative of expansionin the manufacturing sector. On amonth‐over‐month
basis, the Industrial Productionindex rose 0.9% inMarch, followingan upwardly revised 0.9% increase inFebruary. Capacity utilization roseto
78.3% inMarch, upfrom77.7% inFebruary. Althoughcapacity utilizationremains below itslonger‐runaverage of 79.6%, itisrunning above the
pre‐pandemic level of 76.3%.
‐20.0%
‐15.0%
‐10.0%
‐5.0%
0.0%
5.0%
10.0%
15.0%
20.0%
Industrial Production
YOY( %) Change16
Source: US Department of Commerce Source: US Department of Commerce
6/21 9/21 12/21 3/22
7.9% 1.4% 1.8% 1.8%
‐0.7% 2.1% 5.8% 0.4%
‐0.2%‐1.3%‐0.2%‐3.2%
‐0.4%‐0.4%‐0.3%‐0.4%
0.0% 0.5%‐0.2%‐0.1%
6.7% 2.3% 6.9%‐1.4%
Gross Private Domestic Investment
Personal Consumption Expenditures
Components of GDP
Federal Government Expenditures
State and Local (Consumption and Gross
Investment)
Net Exports and Imports
Total
‐35.0%
‐30.0%
‐25.0%
‐20.0%
‐15.0%
‐10.0%
‐5.0%
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
30.0%
35.0%
Gross Domestic Product (GDP)
GDP QOQ % Change
GDP YOY % Change
Gross Domestic Product (GDP)
According to the advance estimate, first quarter 2022GDP unexpectedly contracted at an annualizedrate of 1.4%, followingfourth quarter2021
growth of 6.9%. The most significant contributors to the decline were a widening of the trade deficit and slower inventory build. Personal
consumptionexpenditures increasedatahealthy pace, reflecting ashift inconsumer demandfrom goods to services. The consensus estimate
calls for 3.0% growth in the current quarter and 3.2% growth for 2022.
17
17
18
10
Federal Reserve
Source: Federal Reserve Source: Bloomberg
As expected at the May meeting, the Federal Open Market Committee (FOMC) announcedit wouldraise the federal fundsrate by 0.50% toa
range of 0.75%‐1.00% and begin shrinking its $9trillion balance sheet starting June 1st. The FOMC will initially reduce its balance sheet by
$47.5 billion per month, increasing to $95billion per month after three months with a combination of US Treasury, agency debt, and agency
mortgage‐backedsecurities. Federal Reserve ChairPowell indicatedthata75basis pointincrease is notcurrently underconsideration, andthe
Treasury yield curvesteepened afterthe announcement.We areanticipating additional rate hikesby theFed inthe nearterm, butwe donot
believe that monetary policy is not on a pre‐set course and the timing and magnitude of rate hikes in the second half of this year will be
dependent on how economic and geopolitical conditions continue to transpire.
0.00%
0.25%
0.50%
0.75%
1.00%
1.25%
1.50%
1.75%
2.00%
2.25%
2.50%
2.75%
Effective Federal Funds Rate
Yield (%)2,000,000
3,000,000
4,000,000
5,000,000
6,000,000
7,000,000
8,000,000
9,000,000
10,000,000
Federal Reserve Balance Sheet Assets
In $ millions18
Source: Bloomberg Source: Bloomberg
0.0%
0.5%
1.0%
1.5%
2.0%
2.5%
3.0%
3.5%
US Treasury Note Yields
2‐Year
5‐Year
10‐Year
Yield (%)0.0%
0.5%
1.0%
1.5%
2.0%
2.5%
3.0%
3.5%
US Treasury Yield Curve
Apr‐22
Jan‐22
Apr‐21Yield (%)Bond Yields
Atthe endof April,the2‐yearTreasury yield was 256basis points higher, and the 10‐YearTreasury yieldwas about131basis points higher, year‐
over‐year. The spreadbetweenthe 2‐yearTreasuryyieldand10‐yearTreasury yieldwas 22basis points at April month‐end, upfrom zerobasis
points at the end of March, but narrow compared to the average historical spread (since 2003) of about 130 basis points. While the flat yield
curve bears watching over the longer run, the spread between 3‐month and 10‐year treasuries is still steep at about 210 basis points, which
indicates likely economic growth in the coming year.
19
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11
SECTION |Section 3 |Account Profile
Objectives
Chandler Asset Management Performance Objective
The performance objective for the City of Newport Beach is to earn a return that equals or exceeds the
return on an index of 1‐3 Year Treasury notes.
Investment Objectives
The investment objectives of the City of Newport Beach are first, to provide safety of principal to ensure
the preservation of capital in the overall portfolio; second, to provide adequate liquidity to meet all
requirements that may be reasonably anticipated; and third, to earn a commensurate rate of return.
Strategy
In order to achieve these objectives, we invest in high quality fixed income securities consistent with the
City’s investment policy and California Government Code.
As of April 30, 2022
21
21
22
12
Category Standard Comment
Treasury Issues No Limitation Complies
Federal Agencies No Limitation; Federal instrumentality (U.S. government‐sponsored enterprises); Federal Agency Obligations Complies
Supranationals
"AA" rating category or higher by a Nationally Recognized Statistical Rating Organization ("NRSRO"); 20% maximum; 10% max per issuer; USD denominated
senior unsecured unsubordinated obligations; Issued or unconditionally guaranteed by International Bank for Reconstruction and Development (IBRD),
International Finance Corporation (IFC), or Inter‐American Development Bank (IADB)
Complies
Municipal Securities
"A" rating category or equivalent by a NRSRO; 30% maximum; 5% max per issuer; Include bonds issued by the City of Newport Beach, State of California,
local agency within the State of California; Registered bonds of any of the other 49 states in addition to California, including bonds payable solely out of the
revenues from a revenue‐producing property owned, controlled, or operated by a state, or department, board, agency, or authority of any of the other 49
states, in addition to California.
Complies
Banker’s Acceptances "A‐1" rated or equivalent by a NRSRO; "A" rating category or equivalent by a NRSRO, if the bank has senior debt outstanding; 40% maximum; 5% max per
issuer; 180 days max maturity Complies
Commercial Paper
"A‐1" rated or equivalent by a NRSRO; "A" rated issuer or equivalent by a NRSRO, if any long‐term debt; 25% maximum; 5% max per issuer; 270 days max
maturity; Entity that issues the commercial paper shall either i: (1) be organized and operating in the U.S. as a general corporation, (2) have assets >$500
million, and (3) have debt other than commercial paper, if any, that is rated "A" category or equivalent by a NRSRO; or ii. (1) be organized within U.S. as a
special purpose corporation, trust, or limited liability company, (2) have program wide credit enhancements, including, but not limited to, over
collateralization, letters of credit or surety bond and (3) have commercial paper that is rated "A‐1" or equivalent by a NRSRO.
Complies
Negotiable Certificates of Deposit
(NCD)
"A" long‐term debt rating category or equivalent by a NRSRO; or "A‐1" short‐term debt rated or equivalent by a NRSRO; and having assets in excess of $10
billion; 30% maximum (combined NCDs, CDs); 5% max per issuer; 2 years max maturity Complies
Non‐Negotiable Certificates of Deposit 30% maximum (combined NCDs, CDs); 5% max per issuer; FDIC Insured; or Secured pursuant to California Government Code; 2 years max maturity Complies
Medium Term Notes "A" rating category or equivalent by a NRSRO; 30% maximum; 5% max per issuer; Issued by corporations organized and operating within the U.S. or by
depository institutions licensed by the U.S. or any state and operating within the U.S.Complies
Asset‐Backed Securities, Mortgage‐
Backed Securities, Collateralized
Mortgage Obligations
"AAA" rated or equivalent by a NRSRO; 20% maximum (combined mortgage‐backed, asset‐backed securities, CMOs); 5% max per issuer; From issuers not
defined in sections (a) US Treasuries, (b) Federal Instrumentalities, (c) Federal Agency Obligations.Complies
Money Market Mutual Funds and
Mutual Funds
Highest rating or "AAA" rated by two NRSROs; or SEC registered adviser with AUM >$500 million and experience greater than 5 years; 10% per one Mutual
Fund; 20% maximum in Money Market Mutual Funds; 20% maximum combined of total portfolio in these securities Complies
Repurchase Agreements; Reverse
Repurchase Agreements
"A‐1" or equivalent short term rating; or "A" long term rating or equivalent; 10% maximum for reverse repurchase agreements; 30 days max maturity;
Collateralized by U.S. Treasuries or Federal Instrumentalities; Not used by Investment Adviser Complies
Local Agency Investment Fund (LAIF) Pursuant to California Govt Code Section 16429.1; Not used by Investment Adviser Complies
County Investment Funds 5% maximum; Los Angeles County Pool; Not used by Investment Adviser Complies
Prohibited Derivative structures such as Range Notes, Dual Index Notes, Inverse floaters, Leveraged or de‐leveraged floating rate notes; Interest‐only strips from
mortgaged backed securities; Zero interest accrual securities; Orange County Pool Complies
Credit Quality In the event a security held by the City is the subject of a rating downgrade which brings it below accepted minimums, or the security is place on negative
credit watch, where downgrade could result in a rate drop below acceptable levels, the investment adviser will immediately notify the Finance Director.Complies
Max Per Issuer 5% of portfolio, except Governmental issuers, Supranationals, Investment pools, Mutual Funds, and Money Market Funds, or unless otherwise specified in the
investment policy. Restriction does not apply to any type of Federal Instrumentality or Federal Agency Security Complies
Maximum maturity 5 years Complies
Assets managed by Chandler Asset Management are in full compliance with state law and the Client's investment policy.
City of Newport Beach, California Consolidated
Compliance As of April 30, 2022
22
Portfolio Characteristics
City of Newport Beach, California
04/30/22 01/31/22
Benchmark* Portfolio Portfolio
Average Maturity (yrs)1.83 1.92 2.01
Average Modified Duration 1.77 1.72 1.83
Average Purchase Yield n/a 1.19% 1.14%
Average Market Yield 2.58% 2.58% 1.13%
Average Quality**AAA AA/Aa1 AA+/Aa1
Total Market Value 266,983,537 266,495,010
*ICE BofA 1‐3 Yr US Treasury Index
**Benchmark is a blended rating of S&P, Moody’s, and Fitch. Portfolio is S&P and Moody’s respectively.
As of April 30, 2022
23
23
24
13
City of Newport Beach, California
Sector Distribution
ABS
8.7%
Agency
32.3%
CMO
1.8%
Corporate
23.2%
Money Market
Fund
0.1%
Municipal Bonds
0.7%
Supranational
4.5%
US Treasury
28.7%
April 30, 2022 January 31, 2022
ABS
8.3%
Agency
32.5%
CMO
1.6%
Corporate
19.5%
Money Market
Fund
0.0%
Municipal Bonds
0.8%
Supranational
4.6%
US Treasury
32.8%
As of April 30, 2022
24
Duration Allocation As of April 30, 2022
City of Newport Beach, California
0 ‐0.25 0.25 ‐0.50 0.50 ‐11 ‐22 ‐33 ‐44 ‐55+
04/30/22 1.4% 7.6% 10.3% 42.1% 33.6% 5.0% 0.0% 0.0%
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
0 ‐ 0.25 Years 0.25 ‐ 0.5 Years 0.5 ‐ 1 Years 1 ‐ 2 Years 2 ‐ 3 Years 3 ‐ 4 Years 4 ‐ 5 Years 5+ Years
ABS
Agency
CMO
Corporate
Money Market Fund
Municipal Bonds
Supranational
US Treasury
25
25
26
14
Portfolio Allocation & Duration Changes
City of Newport Beach, California
As of April 30, 2022
Benchmark: ICE BofA 1‐3 Yr US Treasury Index
97.0%101.9%98.1%98.7%100.7%99.2%
95.6%96.0%
80.0%
85.0%
90.0%
95.0%
100.0%
105.0%
110.0%
04/30/2201/31/2210/31/2107/31/2104/30/2101/31/2110/31/2007/31/20
Duration as a % of the Benchmark
0.0%
0.8%
1.6%
4.6%
8.3%
19.5%
32.8%
32.5%
0.1%
0.7%
1.8%
4.5%
8.7%
23.3%
28.7%
32.3%
Money Market
Fund
Municipal Bonds
CMO
Supranational
ABS
Corporate
US Treasury
Agency
Portfolio Allocation
04/30/22
01/31/22
26
Issue Name Investment Type % Portfolio
Government of United States US Treasury 28.69%
Federal Home Loan Bank Agency 10.28%
Federal Farm Credit Bank Agency 9.93%
Federal National Mortgage Association Agency 6.11%
Federal Home Loan Mortgage Corp Agency 5.99%
Intl Bank Recon and Development Supranational 2.17%
Federal Home Loan Mortgage Corp CMO 1.79%
Deere & Company Corporate 1.48%
Inter‐American Dev Bank Supranational 1.40%
John Deere ABS ABS 1.40%
Paccar Financial Corporate 1.38%
Hyundai Auto Receivables ABS 1.32%
GM Financial Automobile Leasing Trust ABS 1.29%
New York Life Global Funding Corporate 1.17%
JP Morgan Chase & Co Corporate 1.10%
MasterCard Inc Corporate 1.10%
Target Corp Corporate 1.09%
Toyota Motor Corp Corporate 1.08%
Caterpillar Inc Corporate 1.04%
Bank of America Corp Corporate 0.95%
Bank of New York Corporate 0.93%
Royal Bank of Canada Corporate 0.92%
Duke Energy Field Services Corporate 0.91%
Hyundai Auto Lease Securitization ABS 0.91%
International Finance Corp Supranational 0.91%
Metlife Inc Corporate 0.90%
Honda ABS ABS 0.90%
Toyota Lease Owner Trust ABS 0.86%
National Rural Utilities Corporate 0.86%
Charles Schwab Corp/The Corporate 0.80%
Wal‐Mart Stores Corporate 0.77%
US Bancorp Corporate 0.76%
Toronto Dominion Holdings Corporate 0.75%
Apple Inc Corporate 0.75%
State of New York Municipal Bonds 0.74%
Mass Mutual Insurance Corporate 0.74%
Bank of Montreal Chicago Corporate 0.71%
Amazon.com Inc Corporate 0.66%
Issuers
City of Newport Beach, California – Account #10
As of April 30, 2022
27
27
28
15
Issue Name Investment Type % Portfolio
BMW Vehicle Lease Trust ABS 0.60%
Prudential Financial Inc Corporate 0.59%
GM Financial Securitized Term Auto Trust ABS 0.44%
Mercedes‐Benz Auto Lease Trust ABS 0.42%
United Health Group Inc Corporate 0.41%
Visa Inc Corporate 0.38%
Berkshire Hathaway Corporate 0.38%
State Street Bank Corporate 0.32%
Toyota ABS ABS 0.29%
Nissan ABS ABS 0.27%
Honda Motor Corporation Corporate 0.19%
Salesforce.com Inc Corporate 0.17%
Federated GOVT Obligation MMF Money Market Fund 0.05%
TOTAL 100.00%
Issuers
City of Newport Beach, California – Account #10
As of April 30, 2022
28
AAA AA A <A NR
04/30/22 10.6% 68.1% 16.9% 0.0% 4.4%
01/31/22 10.8% 72.1% 13.4% 0.0% 3.7%
Source: S&P Ratings
April 30, 2022 vs. January 31, 2022
0.0%
10.0%
20.0%
30.0%
40.0%
50.0%
60.0%
70.0%
80.0%
AAA AA A <A NR
April 30, 2022 January 31, 2022
Quality Distribution
City of Newport Beach, California
As of April 30, 2022
29
29
30
16
0.0%
10.0%
20.0%
30.0%
40.0%
50.0%
60.0%
70.0%
0 ‐ 0.25 0.25 ‐ 0.50 0.50 ‐ 11 ‐ 22 ‐ 33 ‐ 44 ‐ 55+
City of Newport Beach, California ICE BofA 1‐3 Yr US Treasury Index
Portfolio Compared to the Benchmark
0 ‐0.25 0.25 ‐0.50 0.50 ‐11 ‐22 ‐33 ‐44 ‐55+
Portfolio 1.4% 7.6% 10.3% 42.1% 33.6% 5.0% 0.0% 0.0%
Benchmark* 0.0% 0.0% 3.1% 57.5% 39.4% 0.0% 0.0% 0.0%
*ICE BofA 1‐3 Yr US Treasury Index
Duration Distribution
City of Newport Beach, California
As of April 30, 2022
30
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
30.0%
35.0%
40.0%
45.0%
0 ‐ 0.25 0.25 ‐ 0.50 0.50 ‐ 11 ‐ 22 ‐ 33 ‐ 44 ‐ 55+
April 30, 2022 January 31, 2022
April 30, 2022 vs. January 31, 2022
0 ‐0.25 0.25 ‐0.50 0.50 ‐11 ‐22 ‐33 ‐44 ‐55+
04/30/22 1.4% 7.6% 10.3% 42.1% 33.6% 5.0% 0.0% 0.0%
01/31/22 1.2% 3.8% 14.9% 38.7% 35.1% 6.3% 0.0% 0.0%
City of Newport Beach, California
Duration Distribution As of April 30, 2022
31
31
32
17
‐4.00%
‐3.00%
‐2.00%
‐1.00%
0.00%
1.00%
2.00%
3.00%
4.00%
5.00%
12 months 2 years 3 years 5 years 10 years Since Inception
City of Newport Beach, California ICE BofA 1‐3 Yr US Treasury Index
Total Rate of Return Annualized Since Inception March 31, 1991
Annualized
TOTAL RATE OF RETURN 3 months 12 months 2 years 3 years 5 years 10 years Since
Inception
City of Newport Beach, California ‐2.04%‐3.13%‐1.19% 0.87% 1.22% 1.04% 3.81%
ICE BofA 1‐3 Yr US Treasury Index ‐2.17%‐3.35%‐1.57% 0.65% 0.95% 0.79% 3.53%
Total rate of return: A measure of a portfolio’s performance over time. It is the internal rate of return, which equates the beginning value of the portfolio with the
ending value; it includes interest earnings, realized and unrealized gains and losses in the portfolio.
Investment Performance
City of Newport Beach, California
As of April 30, 2022
32
Portfolio Characteristics
City of Newport Beach, California ‐Short Term
04/30/22
Portfolio
01/31/22
Portfolio
Average Maturity (yrs)0.33 0.51
Modified Duration 0.33 0.51
Average Purchase Yield 0.67% 0.39%
Average Market Yield 0.94% 0.43%
Average Quality*AA+/Aaa AA+/Aaa
Total Market Value 33,997,683 19,001,951
*Portfolio is S&P and Moody’s, respectively.
As of April 30, 2022
33
33
34
18
City of Newport Beach, California ‐Short Term
Sector Distribution
Commercial
Paper
40.3%
Money Market
Fund
0.3%Negotiable CD
6.5%
US Treasury
53.0%
April 30, 2022 January 31, 2022
Commercial
Paper
72.0%
Money Market
Fund
0.5%
Negotiable CD
11.6%
US Treasury
16.0%
As of April 30, 2022
34
Issue Name Investment Type % Portfolio
Government of United States US Treasury 53.00%
Rabobank Nederland NV NY Commercial Paper 14.70%
MUFG Bank Ltd/NY Commercial Paper 14.69%
Toronto Dominion Holdings Negotiable CD 6.45%
Toyota Motor Corp Commercial Paper 5.57%
Royal Bank of Canada NY Commercial Paper 5.29%
Goldman Sachs Financial Square Funds ‐Treasury Obligations Fund Money Market Fund 0.29%
TOTAL 100.00%
Issuers
City of Newport Beach, California ‐Short Term – Account #12
As of April 30, 2022
35
35
36
19
AAA AA A <A NR
04/30/22 17.6% 82.4% 0.0% 0.0% 0.0%
01/31/22 31.5% 68.5% 0.0% 0.0% 0.0%
Source: S&P Ratings
April 30, 2022 vs. January 31, 2022
0.0%
10.0%
20.0%
30.0%
40.0%
50.0%
60.0%
70.0%
80.0%
90.0%
AAA AA A <A NR
April 30, 2022 January 31, 2022
Quality Distribution
City of Newport Beach, California ‐Short Term
As of April 30, 2022
36
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
30.0%
35.0%
40.0%
45.0%
50.0%
55.0%
60.0%
65.0%
70.0%
75.0%
80.0%
85.0%
0 ‐ 0.25 0.25 ‐ 0.50 0.50 ‐ 11 ‐ 22 ‐ 33 ‐ 44 ‐ 55+
April 30, 2022 January 31, 2022
April 30, 2022 vs. January 31, 2022
0 ‐0.25 0.25 ‐0.50 0.50 ‐11 ‐22 ‐33 ‐44 ‐55+
04/30/22 20.3% 79.7% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
01/31/22 0.5% 35.7% 63.8% 0.0% 0.0% 0.0% 0.0% 0.0%
City of Newport Beach, California ‐Short Term
Duration Distribution As of April 30, 2022
37
37
38
20
‐0.20%
0.00%
0.20%
0.40%
0.60%
0.80%
1.00%
1.20%
1.40%
12 months 2 years 3 years 5 years 10 years Since Inception
City of Newport Beach, California ‐ Short Term
Total Rate of Return Annualized Since Inception December 31, 2015
Annualized
TOTAL RATE OF RETURN 3 months 12 months 2 years 3 years 5 years 10 years Since
Inception
City of Newport Beach, California ‐Short Term ‐0.02%‐0.01% 0.16% 0.91% 1.30% N/A 1.18%
Total rate of return: A measure of a portfolio’s performance over time. It is the internal rate of return, which equates the beginning value of the portfolio with the
ending value; it includes interest earnings, realized and unrealized gains and losses in the portfolio.
Investment Performance
City of Newport Beach, California ‐Short Term
As of April 30, 2022
38
SECTION |Section 4 |Consolidated Information
39
40
21
Portfolio Characteristics
City of Newport Beach, California Consolidated
04/30/22 01/31/22
Portfolio Portfolio
Average Maturity (yrs)1.74 1.91
Modified Duration 1.56 1.74
Average Purchase Yield 1.13% 1.09%
Average Market Yield 2.39% 1.08%
Average Quality*AA+/Aa1 AA+/Aa1
Total Market Value 300,981,220 285,496,961
* Portfolio is S&P and Moody’s respectively.
As of April 30, 2022
40
City of Newport Beach, California Consolidated
Sector Distribution
ABS
7.7%
Agency
28.7%
CMO
1.6%
Commercial
Paper
4.5%
Corporate
20.6%
Money Market
Fund
0.1%
Municipal Bonds
0.7%
Negotiable CD
0.7%
Supranational
4.0%
US Treasury
31.4%
April 30, 2022 January 31, 2022
ABS
7.7%
Agency
30.3%
CMO
1.5%
Commercial
Paper
4.8%
Corporate
18.2%
Money Market
Fund
0.1%
Municipal Bonds
0.7%
Negotiable CD
0.8%
Supranational
4.3%
US Treasury
31.6%
As of April 30, 2022
41
41
42
22
Issue Name Investment Type % Portfolio
Government of United States US Treasury 31.44%
Federal Home Loan Bank Agency 9.12%
Federal Farm Credit Bank Agency 8.81%
Federal National Mortgage Association Agency 5.42%
Federal Home Loan Mortgage Corp Agency 5.31%
Intl Bank Recon and Development Supranational 1.92%
Rabobank Nederland NV NY Commercial Paper 1.66%
MUFG Bank Ltd/NY Commercial Paper 1.66%
Federal Home Loan Mortgage Corp CMO 1.59%
Deere & Company Corporate 1.31%
Inter‐American Dev Bank Supranational 1.24%
John Deere ABS ABS 1.24%
Paccar Financial Corporate 1.22%
Hyundai Auto Receivables ABS 1.18%
GM Financial Automobile Leasing Trust ABS 1.14%
New York Life Global Funding Corporate 1.04%
JP Morgan Chase & Co Corporate 0.98%
MasterCard Inc Corporate 0.97%
Target Corp Corporate 0.97%
Toyota Motor Corp Corporate 0.95%
Caterpillar Inc Corporate 0.92%
Bank of America Corp Corporate 0.85%
Bank of New York Corporate 0.82%
Royal Bank of Canada Corporate 0.82%
Duke Energy Field Services Corporate 0.81%
Hyundai Auto Lease Securitization ABS 0.80%
International Finance Corp Supranational 0.80%
Metlife Inc Corporate 0.80%
Honda ABS ABS 0.80%
Toyota Lease Owner Trust ABS 0.76%
National Rural Utilities Corporate 0.76%
Toronto Dominion Holdings Negotiable CD 0.73%
Charles Schwab Corp/The Corporate 0.71%
Wal‐Mart Stores Corporate 0.68%
US Bancorp Corporate 0.67%
Toronto Dominion Holdings Corporate 0.66%
Apple Inc Corporate 0.66%
State of New York Municipal Bonds 0.66%
Issuers
City of Newport Beach, California Consolidated – Account #13
As of April 30, 2022
42
Issue Name Investment Type % Portfolio
Mass Mutual Insurance Corporate 0.65%
Toyota Motor Corp Commercial Paper 0.63%
Bank of Montreal Chicago Corporate 0.63%
Royal Bank of Canada NY Commercial Paper 0.60%
Amazon.com Inc Corporate 0.58%
BMW Vehicle Lease Trust ABS 0.53%
Prudential Financial Inc Corporate 0.52%
GM Financial Securitized Term Auto Trust ABS 0.39%
Mercedes‐Benz Auto Lease Trust ABS 0.37%
United Health Group Inc Corporate 0.36%
Visa Inc Corporate 0.34%
Berkshire Hathaway Corporate 0.33%
State Street Bank Corporate 0.29%
Toyota ABS ABS 0.26%
Nissan ABS ABS 0.24%
Honda Motor Corporation Corporate 0.17%
Salesforce.com Inc Corporate 0.15%
Federated GOVT Obligation MMF Money Market Fund 0.04%
Goldman Sachs Financial Square Funds ‐Treasury Obligations Fund Money Market Fund 0.03%
TOTAL 100.00%
Issuers
City of Newport Beach, California Consolidated – Account #13
As of April 30, 2022
43
43
44
23
SECTION |Section 5 |Portfolio Holdings
Holdings Report
City of Newport Beach, California ‐Account #10
CUSIP Security Description Par Value/Units Purchase Date
Book Yield
Cost Value
Book Value
Mkt Price
Mkt YTM
Market Value
Accrued Int.
% of Port.
Gain/Loss
Moody/S&P
Fitch
Maturity
Duration
ABS
43815NAC8 Honda Auto Receivables Trust 2019‐3 A3
1.780% Due 08/15/2023
470,380.08 08/20/2019
1.79%
470,376.17
470,379.60
100.06
1.56%
470,645.37
372.12
0.18%
265.77
Aaa / AAA
NR
1.29
0.24
477870AC3 John Deere Owner Trust 2019‐B A3
2.210% Due 12/15/2023
167,909.99 07/16/2019
2.23%
167,874.35
167,896.82
100.19
1.49%
168,236.74
164.92
0.06%
339.92
Aaa / NR
AAA
1.63
0.27
43813RAC1 Honda Auto Receivables 2020‐1 A31.610% Due 04/22/2024 1,098,651.65 02/19/20201.62%1,098,436.321,098,549.17 99.77 2.09%1,096,085.20 491.34 0.41% (2,463.97)Aaa / NRAAA 1.980.49
89238EAC0 Toyota Lease Owner Trust 2021‐A A3
0.390% Due 04/22/2024
1,235,000.00 04/13/2021
0.40%
1,234,855.88
1,234,917.16
97.90
2.67%
1,209,047.71
147.17
0.45%
(25,869.45)
Aaa / AAA
NR
1.98
0.93
44891VAC5 Hyundai Auto Lease Trust 2021‐B A3
0.330% Due 06/17/2024
1,435,000.00 06/08/2021
0.34%
1,434,784.75
1,434,868.39
97.59
2.73%
1,400,453.81
210.47
0.52%
(34,414.58)
Aaa / AAA
NR
2.13
1.01
65479JAD5 Nissan Auto Receivables Owner 2019‐C A31.930% Due 07/15/2024 728,689.67 10/16/20191.94%728,651.20728,671.72 99.99 1.97%728,600.77 625.05 0.27% (70.95)Aaa / AAANR 2.210.35
47789KAC7 John Deere Owner Trust 2020‐A A3
1.100% Due 08/15/2024
798,191.05 03/04/2020
1.11%
798,142.30
798,165.83
99.51
2.09%
794,267.14
390.23
0.30%
(3,898.69)
Aaa / NR
AAA
2.30
0.49
89239CAC3 Toyota Lease Owner Trust 2021‐B A3
0.420% Due 10/21/2024
1,125,000.00 07/27/2021
0.42%
1,124,984.81
1,124,989.40
96.74
2.92%
1,088,365.50
144.38
0.41%
(36,623.90)
Aaa / NR
AAA
2.48
1.31
36262XAC8 GM Financial Auto Lease Trust 2021‐3 A20.390% Due 10/21/2024 1,690,000.00 08/10/20210.39%1,689,977.021,689,983.67 96.87 2.93%1,637,086.10 201.39 0.61% (52,897.57)NR / AAAAAA 2.481.24
58769KAD6 Mercedes‐Benz Auto Lease Trust 2021‐B A3
0.400% Due 11/15/2024
1,145,000.00 06/22/2021
0.40%
1,144,913.55
1,144,941.99
97.09
2.91%
1,111,631.27
203.56
0.42%
(33,310.72)
NR / AAA
AAA
2.55
1.17
09690AAC7 BMW Vehicle Lease Trust 2021‐2 A3
0.330% Due 12/26/2024
765,000.00 09/08/2021
0.34%
764,921.05
764,942.71
97.37
2.71%
744,908.04
42.08
0.28%
(20,034.67)
Aaa / NR
AAA
2.66
1.11
44891WAC3 Hyundai Auto Lease Trust 2022‐A A3
1.160% Due 01/15/2025
1,050,000.00 01/11/2022
1.16%
1,049,976.80
1,049,979.70
97.23
2.97%
1,020,870.90
541.33
0.38%
(29,108.80)
Aaa / AAA
NR
2.72
1.55
36265MAC9 GM Financial Auto Lease Trust 2022‐1 A3
1.900% Due 03/20/2025
1,835,000.00 02/15/2022
1.91%
1,834,984.22
1,834,985.56
98.06
3.07%
1,799,432.20
1,065.32
0.67%
(35,553.36)
Aaa / NR
AAA
2.89
1.68
05601XAC3 BMW Vehicle Lease Trust 2022‐1 A3
1.100% Due 03/25/2025
870,000.00 01/11/2022
1.11%
869,869.94
869,886.61
97.40
2.91%
847,403.49
159.50
0.32%
(22,483.12)
NR / AAA
AAA
2.90
1.45
47788UAC6 John Deere Owner Trust 2021‐A A3
0.360% Due 09/15/2025
765,000.00 03/02/2021
0.37%
764,852.97
764,899.59
96.53
3.15%
738,466.74
122.40
0.28%
(26,432.85)
Aaa / NR
AAA
3.38
1.25
44933LAC7 Hyundai Auto Receivables Trust 2021‐A A3
0.380% Due 09/15/2025
925,000.00 04/20/2021
0.38%
924,902.69
924,934.86
97.12
2.86%
898,405.33
156.22
0.34%
(26,529.53)
NR / AAA
AAA
3.38
1.16
44934KAC8 Hyundai Auto Receivables Trust 2021‐B A3
0.380% Due 01/15/2026
2,130,000.00 07/20/2021
0.39%
2,129,529.91
2,129,643.63
96.20
3.12%
2,049,115.38
359.73
0.77%
(80,528.25)
NR / AAA
AAA
3.72
1.40
As of April 30, 2022
45
45
46
24
Holdings Report
City of Newport Beach, California ‐Account #10
CUSIP Security Description Par Value/Units Purchase Date
Book Yield
Cost Value
Book Value
Mkt Price
Mkt YTM
Market Value
Accrued Int.
% of Port.
Gain/Loss
Moody/S&P
Fitch
Maturity
Duration
43815GAC3 Honda Auto Receivables Trust 2021‐4 A3
0.880% Due 01/21/2026
860,000.00 11/16/2021
0.89%
859,818.71
859,842.88
96.22
3.03%
827,454.16
210.22
0.31%
(32,388.72)
Aaa / NR
AAA
3.73
1.78
47789QAC4 John Deere Owner Trust 2021‐B A3
0.520% Due 03/16/2026
1,000,000.00 07/13/2021
0.52%
999,910.80
999,929.80
95.26
3.28%
952,600.00
231.11
0.36%
(47,329.80)
Aaa / NR
AAA
3.88
1.74
89238JAC9 Toyota Auto Receivables Trust 2021‐D A3
0.710% Due 04/15/2026
800,000.00 11/09/2021
0.71%
799,982.96
799,985.36
96.23
2.97%
769,870.40
252.44
0.29%
(30,114.96)
NR / AAA
AAA
3.96
1.69
44935FAD6 Hyundai Auto Receivables Trust 2021‐C A3
0.740% Due 05/15/2026
615,000.00 11/09/2021
0.75%
614,862.73
614,882.34
95.80
3.18%
589,172.46
202.27
0.22%
(25,709.88)
NR / AAA
AAA
4.04
1.75
362554AC1 GM Financial Securitized Term 2021‐4 A3
0.680% Due 09/16/2026
640,000.00 10/13/2021
0.68%
639,983.68
639,986.20
96.12
3.10%
615,168.00
181.33
0.23%
(24,818.20)
Aaa / AAA
NR
4.38
1.63
47787JAC2 John Deere Owner Trust 2022‐A A3
2.320% Due 09/16/2026
1,110,000.00 03/10/2022
2.34%
1,109,754.47
1,109,763.30
97.78
3.57%
1,085,344.68
1,144.53
0.41%
(24,418.62)
Aaa / NR
AAA
4.38
1.81
380146AC4 GM Financial Auto Receivables 2022‐1 A3
1.260% Due 11/16/2026
575,000.00 01/11/2022
1.27%
574,950.03
574,954.23
96.07
4.65%
552,405.95
301.88
0.21%
(22,548.28)
NR / AAA
AAA
4.55
1.17
TOTAL ABS 23,833,822.44 0.90%
23,831,297.31
23,831,980.52 2.89%
23,195,037.34
7,920.99
8.69%
(636,943.18)
Aaa / AAA
Aaa
2.98
1.26
Agency
3130AEBM1 FHLB Note
2.750% Due 06/10/2022
3,000,000.00 Various
2.86%
2,987,747.50
2,999,658.61
100.22
0.73%
3,006,708.00
32,312.50
1.14%
7,049.39
Aaa / AA+
NR
0.11
0.11
313383WD9 FHLB Note
3.125% Due 09/09/2022
3,750,000.00 09/25/2018
3.01%
3,765,750.00
3,751,428.84
100.66
1.26%
3,774,903.75
16,927.08
1.42%
23,474.91
Aaa / AA+
AAA
0.36
0.36
3133EKHN9 FFCB Note2.330% Due 10/18/2022 2,500,000.00 05/02/20192.37%2,496,400.002,499,515.82 100.41 1.44%2,510,322.50 2,103.47 0.94% 10,806.68 Aaa / AA+AAA 0.470.46
3135G0T94 FNMA Note
2.375% Due 01/19/2023
1,600,000.00 10/04/2018
3.10%
1,554,000.00
1,592,279.51
100.41
1.80%
1,606,497.60
10,766.67
0.61%
14,218.09
Aaa / AA+
AAA
0.72
0.71
3133EKUA2 FFCB Note
1.850% Due 02/01/2023
4,000,000.00 07/23/2019
1.87%
3,997,160.00
3,999,391.43
100.11
1.70%
4,004,488.00
18,500.00
1.51%
5,096.57
Aaa / AA+
AAA
0.76
0.74
3133ELNW0 FFCB Note
1.450% Due 02/21/2023
2,290,000.00 02/19/2020
1.45%
2,290,274.80
2,290,074.22
99.58
1.98%
2,280,340.78
6,456.53
0.86%
(9,733.44)
Aaa / AA+
AAA
0.81
0.80
3130ADRG9 FHLB Note
2.750% Due 03/10/2023
4,800,000.00 01/18/2019
2.75%
4,800,576.00
4,800,119.55
100.61
2.03%
4,829,265.60
18,700.00
1.82%
29,146.05
Aaa / AA+
NR
0.86
0.85
3135G04Q3 FNMA Note
0.250% Due 05/22/2023
4,000,000.00 08/11/2020
0.25%
3,999,920.00
3,999,969.52
97.94
2.22%
3,917,744.00
4,416.67
1.47%
(82,225.52)
Aaa / AA+
AAA
1.06
1.05
3133834G3 FHLB Note
2.125% Due 06/09/2023
3,900,000.00 Various
2.13%
3,899,157.00
3,899,808.16
99.85
2.26%
3,894,150.00
32,689.58
1.47%
(5,658.16)
Aaa / AA+
NR
1.11
1.08
As of April 30, 2022
46
Holdings Report
City of Newport Beach, California ‐Account #10
CUSIP Security Description Par Value/Units Purchase Date
Book Yield
Cost Value
Book Value
Mkt Price
Mkt YTM
Market Value
Accrued Int.
% of Port.
Gain/Loss
Moody/S&P
Fitch
Maturity
Duration
3133EKSN7 FFCB Note
1.770% Due 06/26/2023
4,000,000.00 06/21/2019
1.89%
3,981,400.00
3,994,640.25
99.38
2.31%
3,975,296.00
24,583.33
1.50%
(19,344.25)
Aaa / AA+
AAA
1.16
1.13
3135G05G4 FNMA Note
0.250% Due 07/10/2023
4,000,000.00 09/28/2020
0.23%
4,001,920.00
4,000,824.48
97.55
2.34%
3,902,148.00
3,083.33
1.46%
(98,676.48)
Aaa / AA+
AAA
1.19
1.18
3133EKZK5 FFCB Note1.600% Due 08/14/2023 2,000,000.00 08/09/20191.63%1,997,420.001,999,170.02 99.08 2.33%1,981,606.00 6,844.44 0.74% (17,564.02)Aaa / AA+AAA 1.291.26
3133EL3V4 FFCB Note
0.200% Due 08/14/2023
4,000,000.00 08/12/2020
0.27%
3,991,680.00
3,996,415.77
97.31
2.33%
3,892,516.00
1,711.11
1.46%
(103,899.77)
Aaa / AA+
AAA
1.29
1.27
3137EAEV7 FHLMC Note
0.250% Due 08/24/2023
4,000,000.00 09/23/2020
0.24%
4,000,960.00
4,000,433.08
97.23
2.40%
3,889,024.00
1,861.11
1.46%
(111,409.08)
Aaa / AA+
AAA
1.32
1.30
313383YJ4 FHLB Note3.375% Due 09/08/2023 1,600,000.00 04/05/20192.37%1,666,896.001,620,516.43 101.22 2.45%1,619,574.40 7,950.00 0.61% (942.03)Aaa / AA+NR 1.361.31
3137EAEY1 FHLMC Note
0.125% Due 10/16/2023
5,180,000.00 Various
0.25%
5,160,792.60
5,170,638.20
96.76
2.39%
5,012,349.30
269.79
1.88%
(158,288.90)
Aaa / AA+
AAA
1.46
1.44
3137EAEZ8 FHLMC Note
0.250% Due 11/06/2023
4,275,000.00 11/03/2020
0.28%
4,271,152.50
4,273,055.19
96.63
2.53%
4,130,868.38
5,195.31
1.55%
(142,186.81)
Aaa / AA+
AAA
1.52
1.49
3135G06H1 FNMA Note0.250% Due 11/27/2023 3,775,000.00 11/23/20200.29%3,770,696.503,772,744.29 96.49 2.54%3,642,569.23 4,037.15 1.37% (130,175.06)Aaa / AA+AAA 1.581.55
3137EAFA2 FHLMC Note
0.250% Due 12/04/2023
3,050,000.00 12/02/2020
0.28%
3,046,980.50
3,048,395.12
96.36
2.59%
2,939,019.65
3,113.54
1.10%
(109,375.47)
Aaa / AA+
AAA
1.60
1.57
3130A0F70 FHLB Note
3.375% Due 12/08/2023
4,000,000.00 12/21/2018
2.84%
4,098,680.00
4,031,948.33
101.22
2.60%
4,048,680.00
53,625.00
1.54%
16,731.67
Aaa / AA+
AAA
1.61
1.54
3133EKMX1 FFCB Note
2.230% Due 02/23/2024
2,000,000.00 07/30/2019
1.91%
2,027,800.00
2,011,050.00
99.55
2.49%
1,990,904.00
8,424.44
0.75%
(20,146.00)
Aaa / AA+
AAA
1.82
1.76
3130A7PH2 FHLB Note
1.875% Due 03/08/2024
4,000,000.00 03/03/2020
0.85%
4,161,400.00
4,074,585.53
98.59
2.66%
3,943,756.00
11,041.67
1.48%
(130,829.53)
Aaa / AA+
NR
1.86
1.80
3130AQF40 FHLB Note
1.000% Due 12/20/2024
2,250,000.00 12/21/2021
1.03%
2,248,020.00
2,248,255.28
95.38
2.83%
2,145,984.75
8,062.50
0.81%
(102,270.53)
Aaa / AA+
AAA
2.64
2.56
3133ENKS8 FFCB Note
1.125% Due 01/06/2025
2,000,000.00 01/06/2022
1.20%
1,995,500.00
1,995,953.71
95.57
2.85%
1,911,474.00
6,875.00
0.72%
(84,479.71)
Aaa / AA+
AAA
2.69
2.60
3133ENPY0 FFCB Note
1.750% Due 02/25/2025
4,000,000.00 03/03/2022
1.76%
3,999,280.00
3,999,318.35
96.99
2.87%
3,879,460.00
12,833.33
1.46%
(119,858.35)
Aaa / AA+
AAA
2.83
2.71
As of April 30, 2022
47
47
48
25
Holdings Report
City of Newport Beach, California ‐Account #10
CUSIP Security Description Par Value/Units Purchase Date
Book Yield
Cost Value
Book Value
Mkt Price
Mkt YTM
Market Value
Accrued Int.
% of Port.
Gain/Loss
Moody/S&P
Fitch
Maturity
Duration
3135G05X7 FNMA Note
0.375% Due 08/25/2025
3,500,000.00 12/02/2021
1.15%
3,401,720.00
3,412,479.53
92.03
2.91%
3,221,221.50
2,406.25
1.21%
(191,258.03)
Aaa / AA+
AAA
3.32
3.25
TOTAL Agency 87,470,000.00 1.38%
87,613,283.40
87,482,669.22 2.26%
85,950,871.44
304,789.80
32.31%
(1,531,797.78)
Aaa / AA+
Aaa
1.39
1.36
CMO
3137B7YY9 FHLMC K037 A2
3.490% Due 01/25/2024
1,600,000.00 11/05/2021
0.58%
1,687,062.50
1,668,398.54
100.67
2.90%
1,610,769.60
4,653.33
0.61%
(57,628.94)
NR / AAA
NR
1.74
1.48
3137BFE98 FHLMC K041 A2
3.171% Due 10/25/2024
700,000.00 04/21/2022
2.96%
702,242.19
702,229.58
100.15
3.03%
701,029.70
1,849.75
0.26%
(1,199.88)
Aaa / AAA
AAA
2.49
2.27
3137BFXT3 FHLMC K042 A22.670% Due 12/25/2024 2,500,000.00 08/19/20210.62%2,653,906.252,621,606.53 98.91 3.07%2,472,672.50 1,112.50 0.93% (148,934.03)Aaa / NRNR 2.662.40
TOTAL CMO 4,800,000.00 0.93%
5,043,210.94
4,992,234.65 3.01%
4,784,471.80
7,615.58
1.79%
(207,762.85)
Aaa / AAA
Aaa
2.32
2.07
Corporate
92826CAC6 Visa Inc Callable Note Cont 10/14/2022
2.800% Due 12/14/2022
1,000,000.00 12/20/2018
3.28%
982,250.00
997,223.12
100.47
1.76%
1,004,717.00
10,655.56
0.38%
7,493.88
Aa3 / AA‐
NR
0.62
0.45
24422EUA5 John Deere Capital Corp Note
2.700% Due 01/06/2023
1,500,000.00 07/24/2018
3.38%
1,458,270.00
1,493,580.00
100.56
1.86%
1,508,452.50
12,937.50
0.57%
14,872.50
A2 / A
A
0.69
0.67
89236TEL5 Toyota Motor Credit Corp Note
2.700% Due 01/11/2023
1,000,000.00 09/07/2018
3.33%
974,710.00
995,926.12
100.24
2.35%
1,002,401.00
8,250.00
0.38%
6,474.88
A1 / A+
A+
0.70
0.68
69371RQ41 Paccar Financial Corp Note
1.900% Due 02/07/2023
1,000,000.00 10/31/2019
1.90%
999,950.00
999,988.13
99.74
2.24%
997,394.00
4,433.33
0.38%
(2,594.13)
A1 / A+
NR
0.78
0.76
084670BR8 Berkshire Hathaway Callable Note Cont 1/15/2023
2.750% Due 03/15/2023
1,000,000.00 12/20/2018
3.40%
974,780.00
994,798.99
100.43
2.14%
1,004,287.00
3,513.89
0.38%
9,488.01
Aa2 / AA
A+
0.87
0.70
037833AK6 Apple Inc Note
2.400% Due 05/03/2023
1,000,000.00 04/11/2019
2.70%
988,520.00
997,151.35
100.11
2.29%
1,001,089.00
11,866.67
0.38%
3,937.65
Aaa / AA+
NR
1.01
0.98
57629WCU2 Mass Mutual Global funding Note
0.850% Due 06/09/2023
2,000,000.00 12/15/2021
0.73%
2,003,660.00
2,002,743.30
97.93
2.76%
1,958,610.00
6,705.56
0.74%
(44,133.30)
Aa3 / AA+
AA+
1.11
1.09
931142EK5 Wal‐Mart Stores Callable Note Cont 5/26/2023
3.400% Due 06/26/2023
2,000,000.00 04/29/2019
2.67%
2,055,840.00
2,014,645.33
101.11
2.35%
2,022,116.00
23,611.11
0.77%
7,470.67
Aa2 / AA
AA
1.16
1.04
06406FAD5 Bank of NY Mellon Corp Callable Note Cont 6/16/20232.200% Due 08/16/2023 1,000,000.00 03/27/20192.78%976,220.00992,989.28 99.17 2.86%991,691.00 4,583.33 0.37% (1,298.28)A1 / AAA‐1.301.26
As of April 30, 2022
48
Holdings Report
City of Newport Beach, California ‐Account #10
CUSIP Security Description Par Value/Units Purchase Date
Book Yield
Cost Value
Book Value
Mkt Price
Mkt YTM
Market Value
Accrued Int.
% of Port.
Gain/Loss
Moody/S&P
Fitch
Maturity
Duration
89236TFS9 Toyota Motor Credit Corp Note
3.350% Due 01/08/2024
1,000,000.00 06/14/2019
2.41%
1,040,490.00
1,015,004.40
100.58
2.99%
1,005,818.00
10,515.28
0.38%
(9,186.40)
A1 / A+
A+
1.69
1.62
02665WCT6 American Honda Finance Note
3.550% Due 01/12/2024
500,000.00 01/13/2020
2.06%
528,405.00
512,098.43
100.77
3.08%
503,863.00
5,374.31
0.19%
(8,235.43)
A3 / A‐
A
1.70
1.62
24422EVN6 John Deere Capital Corp Note0.450% Due 01/17/2024 1,850,000.00 03/01/20210.47%1,848,686.501,849,216.16 96.08 2.81%1,777,509.60 2,405.00 0.67% (71,706.56)A2 / AA 1.721.68
91159HHV5 US Bancorp Callable Note Cont 1/5/2024
3.375% Due 02/05/2024
2,000,000.00 Various
2.63%
2,064,710.00
2,023,469.85
100.41
3.12%
2,008,256.00
16,125.00
0.76%
(15,213.85)
A2 / A+
A+
1.77
1.61
637432NL5 National Rural Utilities Callable Note Cont 12/7/2023
2.950% Due 02/07/2024
1,317,000.00 04/06/2022
2.77%
1,320,871.98
1,320,725.51
99.72
3.11%
1,313,361.13
9,065.35
0.50%
(7,364.38)
A1 / A‐
A+
1.78
1.70
06051GHF9 Bank of America Corp Callable Note 1X 3/5/20233.550% Due 03/05/2024 1,565,000.00 04/26/20210.64%1,648,852.701,603,205.08 100.08 2.80%1,566,244.18 8,642.28 0.59% (36,960.90)A2 / A‐AA‐1.851.77
808513BN4 Charles Schwab Corp Callable Note Cont 2/18/2024
0.750% Due 03/18/2024
2,230,000.00 Various
0.71%
2,232,745.00
2,231,696.31
95.79
3.07%
2,136,034.49
1,997.71
0.80%
(95,661.82)
A2 / A
A
1.88
1.84
023135BW5 Amazon.com Inc Note
0.450% Due 05/12/2024
1,835,000.00 05/10/2021
0.50%
1,832,320.90
1,833,186.23
95.50
2.74%
1,752,401.15
3,876.44
0.66%
(80,785.08)
A1 / AA
AA‐
2.04
1.99
91324PEB4 United Health Group Inc Callable Note Cont 5/15/20220.550% Due 05/15/2024 1,135,000.00 11/08/20210.78%1,128,485.101,129,707.09 95.23 2.97%1,080,907.03 2,878.49 0.41% (48,800.06)A3 / A+A 2.042.00
14913R2L0 Caterpillar Financial Service Note
0.450% Due 05/17/2024
2,910,000.00 05/10/2021
0.50%
2,906,100.60
2,907,342.29
95.00
2.99%
2,764,386.51
5,965.50
1.04%
(142,955.78)
A2 / A
A
2.05
2.01
89114QCA4 Toronto Dominion Bank Note
2.650% Due 06/12/2024
2,000,000.00 04/23/2021
0.63%
2,124,500.00
2,084,271.89
98.90
3.19%
1,977,920.00
20,463.89
0.75%
(106,351.89)
A1 / A
AA‐
2.12
2.02
06051GJY6 Bank of America Corp Callable Note Cont 6/14/2023
0.523% Due 06/14/2024
1,000,000.00 06/10/2021
0.52%
1,000,060.00
1,000,033.62
96.72
2.20%
967,155.00
1,990.31
0.36%
(32,878.62)
A2 / A‐
AA‐
2.13
2.08
89236TJH9 Toyota Motor Credit Corp Note
0.500% Due 06/18/2024
890,000.00 06/15/2021
0.54%
888,940.90
889,247.23
94.67
3.10%
842,584.36
1,644.03
0.32%
(46,662.87)
A1 / A+
A+
2.14
2.09
06367TQW3 Bank of Montreal Note
0.625% Due 07/09/2024
2,000,000.00 09/10/2021
0.65%
1,998,380.00
1,998,740.52
94.16
3.41%
1,883,256.00
3,888.89
0.71%
(115,484.52)
A2 / A‐
AA‐
2.19
2.14
79466LAG9 Salesforce.com Inc Callable Note Cont 7/15/2022
0.625% Due 07/15/2024
470,000.00 06/29/2021
0.64%
469,760.30
469,824.21
94.78
3.09%
445,473.52
864.93
0.17%
(24,350.69)
A2 / A+
NR
2.21
2.16
69371RR40 Paccar Financial Corp Note
0.500% Due 08/09/2024
700,000.00 08/05/2021
0.52%
699,555.00
699,662.59
94.31
3.11%
660,135.00
797.22
0.25%
(39,527.59)
A1 / A+
NR
2.28
2.23
As of April 30, 2022
49
49
50
26
Holdings Report
City of Newport Beach, California ‐Account #10
CUSIP Security Description Par Value/Units Purchase Date
Book Yield
Cost Value
Book Value
Mkt Price
Mkt YTM
Market Value
Accrued Int.
% of Port.
Gain/Loss
Moody/S&P
Fitch
Maturity
Duration
037833DM9 Apple Inc Callable Note Cont 8/11/2024
1.800% Due 09/11/2024
1,000,000.00 08/18/2021
0.58%
1,035,810.00
1,027,442.25
97.75
2.79%
977,506.00
2,500.00
0.37%
(49,936.25)
Aaa / AA+
NR
2.37
2.29
59217GEP0 Metlife Note
0.700% Due 09/27/2024
1,555,000.00 Various
0.85%
1,548,375.40
1,549,399.44
93.81
3.40%
1,458,673.97
1,028.03
0.55%
(90,725.47)
Aa3 / AA‐
AA‐
2.41
2.35
78015K7C2 Royal Bank of Canada Note
2.250% Due 11/01/2024
2,500,000.00 05/19/2021
0.74%
2,628,225.00
2,593,115.77
97.05
3.49%
2,426,220.00
28,125.00
0.92%
(166,895.77)
A1 / A
AA‐
2.51
2.38
69371RR57 Paccar Financial Corp Note
0.900% Due 11/08/2024
2,120,000.00 11/02/2021
0.90%
2,119,872.80
2,119,892.99
94.92
3.01%
2,012,301.88
9,169.00
0.76%
(107,591.11)
A1 / A+
NR
2.53
2.45
74153WCQ0 Pricoa Global Funding Note
1.150% Due 12/06/2024
1,655,000.00 12/01/2021
1.19%
1,653,295.35
1,653,519.73
94.72
3.29%
1,567,599.45
7,560.13
0.59%
(85,920.28)
Aa3 / AA‐
AA‐
2.61
2.51
64952WEK5 New York Life Global Note
1.450% Due 01/14/2025
3,255,000.00 01/11/2022
1.49%
3,251,484.60
3,251,827.80
95.29
3.28%
3,101,601.62
14,028.15
1.17%
(150,226.18)
Aaa / AA+
AAA
2.71
2.61
63743HFC1 National Rural Utilities Note
1.875% Due 02/07/2025
1,000,000.00 03/18/2022
2.76%
975,700.00
976,623.08
95.73
3.51%
957,255.00
4,375.00
0.36%
(19,368.08)
A2 / A‐
A
2.78
2.65
46647PAH9 JP Morgan Chase & Co Callable Note 2X 3/1/20243.220% Due 03/01/2025 2,000,000.00 04/23/20210.89%2,130,820.002,084,359.38 99.15 3.28%1,983,012.00 10,733.33 0.75% (101,347.38)A2 / A‐AA‐2.842.67
57636QAN4 MasterCard Inc Callable Note 1x 02/03/2025
2.000% Due 03/03/2025
3,000,000.00 10/28/2021
1.04%
3,091,470.00
3,077,557.34
97.22
3.03%
2,916,528.00
9,666.67
1.10%
(161,029.34)
A1 / A+
NR
2.84
2.73
24422EWB1 John Deere Capital Corp Note
2.125% Due 03/07/2025
670,000.00 03/02/2022
2.14%
669,711.90
669,726.36
97.01
3.23%
649,986.43
2,135.63
0.24%
(19,739.93)
A2 / A
A
2.85
2.73
59217GEW5 Metlife Note2.800% Due 03/21/2025 970,000.00 03/14/20222.83%969,136.70969,168.99 98.03 3.52%950,916.22 3,017.78 0.36% (18,252.77)Aa3 / AA‐AA‐2.892.74
87612EBL9 Target Corp Callable Note Cont 4/15/25
2.250% Due 04/15/2025
3,000,000.00 03/15/2022
2.53%
2,975,610.00
2,976,585.60
97.14
3.27%
2,914,164.00
3,000.00
1.09%
(62,421.60)
A2 / A
A
2.96
2.83
06406RBC0 Bank of NY Mellon Corp Callable Note Cont 3/25/2025
3.350% Due 04/25/2025
1,475,000.00 04/19/2022
3.35%
1,474,793.50
1,474,794.44
99.86
3.40%
1,472,942.38
686.28
0.55%
(1,852.06)
A1 / A
AA‐
2.99
2.82
46647PCH7 JP Morgan Chase & Co Callable Note Cont 6/1/20240.824% Due 06/01/2025 1,000,000.00 05/26/20210.75%1,002,160.001,001,501.75 94.12 2.83%941,222.00 3,433.33 0.35% (60,279.75)A2 / A‐AA‐3.093.00
26442UAA2 Duke Energy Progress LLC Callable Note Cont 5/15/25
3.250% Due 08/15/2025
2,422,000.00 Various
3.25%
2,421,770.62
2,421,756.98
99.38
3.45%
2,406,886.72
16,617.61
0.91%
(14,870.26)
Aa3 / A
NR
3.30
3.07
As of April 30, 2022
50
Holdings Report
City of Newport Beach, California ‐Account #10
CUSIP Security Description Par Value/Units Purchase Date
Book Yield
Cost Value
Book Value
Mkt Price
Mkt YTM
Market Value
Accrued Int.
% of Port.
Gain/Loss
Moody/S&P
Fitch
Maturity
Duration
857477BR3 State Street Bank Callable Note Cont 2/6/2025
1.746% Due 02/06/2026
900,000.00 02/02/2022
1.75%
900,000.00
900,000.00
95.27
3.17%
857,401.20
3,666.60
0.32%
(42,598.80)
A1 / A
AA‐
3.78
3.58
TOTAL Corporate 63,424,000.00 1.56%
63,995,299.85
63,803,748.93 2.99%
61,770,279.34
302,794.12
23.25%
(2,033,469.59)
A1 / A+
AA‐
2.16
2.06
Money Market Fund
60934N104 Federated Investors Government Obligations Fund 134,194.55 Various
0.20%
134,194.55
134,194.55
1.00
0.20%
134,194.55
0.00
0.05%
0.00
Aaa / AAA
AAA
0.00
0.00
TOTAL Money Market Fund 134,194.55 0.20%
134,194.55
134,194.55 0.20%
134,194.55
0.00
0.05%
0.00
Aaa / AAA
Aaa
0.00
0.00
Municipal Bonds
649791PP9 New York St Taxable‐GO
2.010% Due 02/15/2024
2,000,000.00 10/29/2019
2.01%
2,000,000.00
2,000,000.00
98.55
2.84%
1,971,040.00
8,486.67
0.74%
(28,960.00)
Aa1 / AA+
AA+
1.80
1.74
TOTAL Municipal Bonds 2,000,000.00 2.01%
2,000,000.00
2,000,000.00 2.84%
1,971,040.00
8,486.67
0.74%
(28,960.00)
Aa1 / AA+
AA+
1.80
1.74
Supranational
459058JM6 Intl. Bank Recon & Development Note0.250% Due 11/24/2023 3,565,000.00 Various0.28%3,562,215.253,563,558.30 96.39 2.62%3,436,267.85 3,886.84 1.29% (127,290.45)Aaa / AAAAAA 1.571.54
459058GQ0 Intl. Bank Recon & Development Note
2.500% Due 03/19/2024
2,350,000.00 01/26/2021
0.26%
2,514,359.00
2,448,672.77
99.60
2.72%
2,340,642.30
6,854.17
0.88%
(108,030.47)
Aaa / AAA
AAA
1.89
1.82
4581X0DZ8 Inter‐American Dev Bank Note
0.500% Due 09/23/2024
3,955,000.00 09/15/2021
0.52%
3,952,073.30
3,952,660.78
94.60
2.85%
3,741,390.45
2,087.36
1.40%
(211,270.33)
Aaa / AAA
NR
2.40
2.35
45950KCR9 International Finance Corp Note
1.375% Due 10/16/2024
2,500,000.00 07/12/2021
0.54%
2,567,250.00
2,550,804.83
96.62
2.80%
2,415,580.00
1,432.29
0.91%
(135,224.83)
Aaa / AAA
NR
2.47
2.39
TOTAL Supranational 12,370,000.00 0.41%
12,595,897.55
12,515,696.68 2.75%
11,933,880.60
14,260.66
4.48%
(581,816.08)
Aaa / AAA
Aaa
2.07
2.02
US Treasury
9128282P4 US Treasury Note
1.875% Due 07/31/2022
5,000,000.00 12/23/2019
1.68%
5,024,609.38
5,002,357.32
100.23
0.96%
5,011,525.00
23,308.01
1.89%
9,167.68
Aaa / AA+
AAA
0.25
0.25
912828YA2 US Treasury Note
1.500% Due 08/15/2022
5,000,000.00 12/24/2019
1.69%
4,975,976.56
4,997,355.68
100.13
1.05%
5,006,640.00
15,538.67
1.88%
9,284.32
Aaa / AA+
AAA
0.29
0.29
As of April 30, 2022
51
51
52
27
Holdings Report
City of Newport Beach, California ‐Account #10
CUSIP Security Description Par Value/Units Purchase Date
Book Yield
Cost Value
Book Value
Mkt Price
Mkt YTM
Market Value
Accrued Int.
% of Port.
Gain/Loss
Moody/S&P
Fitch
Maturity
Duration
912828M80 US Treasury Note
2.000% Due 11/30/2022
4,000,000.00 Various
1.66%
4,040,390.63
4,007,804.29
100.23
1.60%
4,009,220.00
33,406.60
1.51%
1,415.71
Aaa / AA+
AAA
0.59
0.58
912828R28 US Treasury Note
1.625% Due 04/30/2023
4,000,000.00 12/04/2019
1.60%
4,003,593.75
4,001,053.24
99.48
2.15%
3,979,220.00
176.63
1.49%
(21,833.24)
Aaa / AA+
AAA
1.00
0.99
912828R69 US Treasury Note
1.625% Due 05/31/2023
2,400,000.00 04/11/2019
2.30%
2,336,250.00
2,383,290.48
99.36
2.23%
2,384,532.00
16,285.71
0.90%
1,241.52
Aaa / AA+
AAA
1.08
1.06
91282CBA8 US Treasury Note
0.125% Due 12/15/2023
2,300,000.00 01/08/2021
0.22%
2,293,441.41
2,296,358.39
96.14
2.57%
2,211,144.10
1,082.07
0.83%
(85,214.29)
Aaa / AA+
AAA
1.63
1.60
91282CBE0 US Treasury Note
0.125% Due 01/15/2024
4,000,000.00 01/12/2021
0.24%
3,985,781.25
3,991,897.26
95.88
2.60%
3,835,156.00
1,464.09
1.44%
(156,741.26)
Aaa / AA+
AAA
1.71
1.69
91282CBV2 US Treasury Note
0.375% Due 04/15/2024
5,000,000.00 04/23/2021
0.32%
5,008,398.44
5,005,534.46
95.60
2.70%
4,780,080.00
819.67
1.79%
(225,454.46)
Aaa / AA+
AAA
1.96
1.93
91282CCC3 US Treasury Note
0.250% Due 05/15/2024
3,000,000.00 05/26/2021
0.30%
2,995,312.50
2,996,778.42
95.13
2.72%
2,853,867.00
3,459.94
1.07%
(142,911.42)
Aaa / AA+
AAA
2.04
2.01
91282CCL3 US Treasury Note0.375% Due 07/15/2024 3,500,000.00 07/13/20210.46%3,490,703.133,493,163.07 94.92 2.76%3,322,266.50 3,843.23 1.25% (170,896.57)Aaa / AA+AAA 2.212.17
912828YE4 US Treasury Note
1.250% Due 08/31/2024
4,000,000.00 02/24/2021
0.33%
4,128,125.00
4,085,183.65
96.52
2.80%
3,860,624.00
8,423.91
1.45%
(224,559.65)
Aaa / AA+
AAA
2.34
2.27
91282CCX7 US Treasury Note
0.375% Due 09/15/2024
5,000,000.00 09/08/2021
0.44%
4,990,234.38
4,992,265.91
94.42
2.82%
4,720,900.00
2,394.70
1.77%
(271,365.91)
Aaa / AA+
AAA
2.38
2.33
91282CDB4 US Treasury Note0.625% Due 10/15/2024 1,800,000.00 12/29/20210.94%1,784,460.941,786,319.53 94.82 2.82%1,706,835.60 491.80 0.64% (79,483.93)Aaa / AA+AAA 2.462.41
912828YM6 US Treasury Note
1.500% Due 10/31/2024
4,500,000.00 08/05/2021
0.42%
4,655,917.97
4,620,566.01
96.80
2.84%
4,355,860.50
183.42
1.63%
(264,705.51)
Aaa / AA+
AAA
2.51
2.43
91282CDH1 US Treasury Note
0.750% Due 11/15/2024
5,000,000.00 11/17/2021
0.85%
4,985,156.25
4,987,383.49
94.89
2.85%
4,744,530.00
17,299.72
1.78%
(242,853.49)
Aaa / AA+
AAA
2.55
2.48
912828Z52 US Treasury Note1.375% Due 01/31/2025 3,000,000.00 02/16/20210.37%3,117,656.253,081,968.27 96.09 2.86%2,882,577.00 10,255.52 1.08% (199,391.27)Aaa / AA+AAA 2.762.66
912828ZC7 US Treasury Note
1.125% Due 02/28/2025
2,700,000.00 01/26/2022
1.42%
2,676,058.59
2,678,053.71
95.32
2.86%
2,573,542.80
5,117.53
0.97%
(104,510.91)
Aaa / AA+
AAA
2.84
2.75
912828ZF0 US Treasury Note
0.500% Due 03/31/2025
2,900,000.00 03/17/2021
0.64%
2,884,140.63
2,888,541.23
93.42
2.87%
2,709,235.10
1,228.14
1.02%
(179,306.13)
Aaa / AA+
AAA
2.92
2.86
912828ZL7 US Treasury Note0.375% Due 04/30/2025 5,000,000.00 Various0.50%4,974,296.884,980,901.34 92.87 2.87%4,643,360.00 50.95 1.74% (337,541.34)Aaa / AA+AAA 3.002.94
912828ZT0 US Treasury Note
0.250% Due 05/31/2025
5,000,000.00 10/05/2021
0.70%
4,919,335.94
4,931,862.17
92.25
2.89%
4,612,695.00
5,219.78
1.73%
(319,167.17)
Aaa / AA+
AAA
3.09
3.03
As of April 30, 2022
52
Holdings Report
City of Newport Beach, California ‐Account #10
CUSIP Security Description Par Value/Units Purchase Date
Book Yield
Cost Value
Book Value
Mkt Price
Mkt YTM
Market Value
Accrued Int.
% of Port.
Gain/Loss
Moody/S&P
Fitch
Maturity
Duration
912828K74 US Treasury Note
2.000% Due 08/15/2025
2,300,000.00 04/05/2022
2.77%
2,243,218.75
2,244,375.66
97.15
2.91%
2,234,502.90
9,530.39
0.84%
(9,872.76)
Aaa / AA+
AAA
3.30
3.15
TOTAL US Treasury 79,400,000.00 0.90%
79,513,058.63
79,453,013.58 2.45%
76,438,313.50
159,580.48
28.69%
(3,014,700.08)
Aaa / AA+
Aaa
1.97
1.92
TOTAL PORTFOLIO 273,432,016.99 1.19%
274,726,242.23
274,213,538.13 2.58%
266,178,088.57
805,448.30
100.00%
(8,035,449.56)
Aa1 / AA
Aaa
1.92
1.72
TOTAL MARKET VALUE PLUS ACCRUALS 266,983,536.87
As of April 30, 2022
53
53
54
28
Holdings Report
City of Newport Beach, California ‐Short Term ‐Account #12
CUSIP Security Description Par Value/Units Purchase Date
Book Yield
Cost Value
Book Value
Mkt Price
Mkt YTM
Market Value
Accrued Int.
% of Port.
Gain/Loss
Moody/S&P
Fitch
Maturity
Duration
Commercial Paper
21687BFN6 Rabobank Nederland NV NY Discount CP
0.310% Due 06/22/2022
5,000,000.00 12/21/2021
0.31%
4,992,163.89
4,992,163.89
99.84
0.31%
4,992,163.89
5,597.22
14.70%
0.00
P‐1 / A‐1
NR
0.15
0.14
78015DG61 Royal Bank of Canada NY Discount CP
0.330% Due 07/06/2022
1,800,000.00 12/22/2021
0.34%
1,796,782.50
1,796,782.50
99.82
0.34%
1,796,782.50
2,128.50
5.29%
0.00
P‐1 / A‐1+
NR
0.18
0.18
62479MH48 MUFG Bank Ltd/NY Discount CP
0.340% Due 08/04/2022
5,000,000.00 12/22/2021
0.35%
4,989,375.00
4,989,375.00
99.79
0.35%
4,989,375.00
6,138.89
14.69%
0.00
P‐1 / A‐1
NR
0.26
0.26
89233HJW5 Toyota Motor Credit Discount CP
0.690% Due 09/30/2022
1,900,000.00 01/28/2022
0.70%
1,891,077.92
1,891,077.92
99.53
0.70%
1,891,077.92
3,386.75
5.57%
0.00
P‐1 / A‐1+
F‐1
0.42
0.42
TOTAL Commercial Paper 13,700,000.00 0.38%
13,669,399.31
13,669,399.31 0.38%
13,669,399.31
17,251.36
40.26%
0.00
P‐1 / A‐1
F‐1
0.23
0.23
Money Market Fund
38141W323 Goldman Sachs Financial Square Treasury Obligation
Fund
97,119.59 Various
0.28%
97,119.59
97,119.59
1.00
0.28%
97,119.59
0.00
0.29%
0.00
Aaa / AAA
NR
0.00
0.00
TOTAL Money Market Fund 97,119.59 0.28%
97,119.59
97,119.59 0.28%
97,119.59
0.00
0.29%
0.00
Aaa / AAA
NR
0.00
0.00
Negotiable CD
89114WNP6 Toronto Dominion Yankee CD
0.350% Due 08/29/2022
2,200,000.00 12/23/2021
0.35%
2,200,000.00
2,200,000.00
99.60
1.53%
2,191,299.00
2,759.17
6.45%
(8,701.00)
P‐1 / A‐1+
F‐1+
0.33
0.33
TOTAL Negotiable CD 2,200,000.00 0.35%
2,200,000.00
2,200,000.00 1.53%
2,191,299.00
2,759.17
6.45%
(8,701.00)
Aaa / AAA
Aaa
0.33
0.33
US Treasury
91282CAG6 US Treasury Note
0.125% Due 08/31/2022
5,000,000.00 04/27/2022
1.09%
4,983,593.75
4,983,987.50
99.66
1.16%
4,982,810.00
1,052.99
14.66%
(1,177.50)
Aaa / AA+
AAA
0.34
0.33
912828YF1 US Treasury Note
1.500% Due 09/15/2022
3,000,000.00 01/27/2022
0.49%
3,018,984.38
3,011,308.09
100.10
1.23%
3,003,048.00
5,747.28
8.85%
(8,260.09)
Aaa / AA+
AAA
0.38
0.37
912828L57 US Treasury Note
1.750% Due 09/30/2022
5,000,000.00 04/05/2022
1.12%
5,015,039.06
5,012,914.90
100.18
1.33%
5,008,790.00
7,411.20
14.75%
(4,124.90)
Aaa / AA+
AAA
0.42
0.42
As of April 30, 2022
54
Holdings Report
City of Newport Beach, California ‐Short Term ‐Account #12
CUSIP Security Description Par Value/Units Purchase Date
Book Yield
Cost Value
Book Value
Mkt Price
Mkt YTM
Market Value
Accrued Int.
% of Port.
Gain/Loss
Moody/S&P
Fitch
Maturity
Duration
912828M49 US Treasury Note
1.875% Due 10/31/2022
5,000,000.00 03/02/2022
0.82%
5,034,765.63
5,026,289.71
100.21
1.44%
5,010,740.00
254.76
14.74%
(15,549.71)
Aaa / AA+
AAA
0.50
0.50
TOTAL US Treasury 18,000,000.00 0.92%
18,052,382.82
18,034,500.20 1.29%
18,005,388.00
14,466.23
53.00%
(29,112.20)
Aaa / AA+
Aaa
0.41
0.41
TOTAL PORTFOLIO 33,997,119.59 0.67%
34,018,901.72
34,001,019.10 0.94%
33,963,205.90
34,476.76
100.00%
(37,813.20)
Aaa / AA+
Aaa
0.33
0.33
TOTAL MARKET VALUE PLUS ACCRUALS 33,997,682.66
As of April 30, 2022
55
55
56
29
Holdings Report
City of Newport Beach, California Consolidated ‐Account #13
CUSIP Security Description Par Value/Units Purchase Date
Book Yield
Cost Value
Book Value
Mkt Price
Mkt YTM
Market Value
Accrued Int.
% of Port.
Gain/Loss
Moody/S&P
Fitch
Maturity
Duration
ABS
43815NAC8 Honda Auto Receivables Trust 2019‐3 A3
1.780% Due 08/15/2023
470,380.08 08/20/2019
1.79%
470,376.17
470,379.60
100.06
1.56%
470,645.37
372.12
0.16%
265.77
Aaa / AAA
NR
1.29
0.24
477870AC3 John Deere Owner Trust 2019‐B A3
2.210% Due 12/15/2023
167,909.99 07/16/2019
2.23%
167,874.35
167,896.82
100.19
1.49%
168,236.74
164.92
0.06%
339.92
Aaa / NR
AAA
1.63
0.27
43813RAC1 Honda Auto Receivables 2020‐1 A3
1.610% Due 04/22/2024
1,098,651.65 02/19/2020
1.62%
1,098,436.32
1,098,549.17
99.77
2.09%
1,096,085.20
491.34
0.36%
(2,463.97)
Aaa / NR
AAA
1.98
0.49
89238EAC0 Toyota Lease Owner Trust 2021‐A A3
0.390% Due 04/22/2024
1,235,000.00 04/13/2021
0.40%
1,234,855.88
1,234,917.16
97.90
2.67%
1,209,047.71
147.17
0.40%
(25,869.45)
Aaa / AAA
NR
1.98
0.93
44891VAC5 Hyundai Auto Lease Trust 2021‐B A3
0.330% Due 06/17/2024
1,435,000.00 06/08/2021
0.34%
1,434,784.75
1,434,868.39
97.59
2.73%
1,400,453.81
210.47
0.47%
(34,414.58)
Aaa / AAA
NR
2.13
1.01
65479JAD5 Nissan Auto Receivables Owner 2019‐C A3
1.930% Due 07/15/2024
728,689.67 10/16/2019
1.94%
728,651.20
728,671.72
99.99
1.97%
728,600.77
625.05
0.24%
(70.95)
Aaa / AAA
NR
2.21
0.35
47789KAC7 John Deere Owner Trust 2020‐A A3
1.100% Due 08/15/2024
798,191.05 03/04/2020
1.11%
798,142.30
798,165.83
99.51
2.09%
794,267.14
390.23
0.26%
(3,898.69)
Aaa / NR
AAA
2.30
0.49
89239CAC3 Toyota Lease Owner Trust 2021‐B A30.420% Due 10/21/2024 1,125,000.00 07/27/20210.42%1,124,984.811,124,989.40 96.74 2.92%1,088,365.50 144.38 0.36% (36,623.90)Aaa / NRAAA 2.481.31
36262XAC8 GM Financial Auto Lease Trust 2021‐3 A2
0.390% Due 10/21/2024
1,690,000.00 08/10/2021
0.39%
1,689,977.02
1,689,983.67
96.87
2.93%
1,637,086.10
201.39
0.54%
(52,897.57)
NR / AAA
AAA
2.48
1.24
58769KAD6 Mercedes‐Benz Auto Lease Trust 2021‐B A3
0.400% Due 11/15/2024
1,145,000.00 06/22/2021
0.40%
1,144,913.55
1,144,941.99
97.09
2.91%
1,111,631.27
203.56
0.37%
(33,310.72)
NR / AAA
AAA
2.55
1.17
09690AAC7 BMW Vehicle Lease Trust 2021‐2 A30.330% Due 12/26/2024 765,000.00 09/08/20210.34%764,921.05764,942.71 97.37 2.71%744,908.04 42.08 0.25% (20,034.67)Aaa / NRAAA 2.661.11
44891WAC3 Hyundai Auto Lease Trust 2022‐A A3
1.160% Due 01/15/2025
1,050,000.00 01/11/2022
1.16%
1,049,976.80
1,049,979.70
97.23
2.97%
1,020,870.90
541.33
0.34%
(29,108.80)
Aaa / AAA
NR
2.72
1.55
36265MAC9 GM Financial Auto Lease Trust 2022‐1 A3
1.900% Due 03/20/2025
1,835,000.00 02/15/2022
1.91%
1,834,984.22
1,834,985.56
98.06
3.07%
1,799,432.20
1,065.32
0.60%
(35,553.36)
Aaa / NR
AAA
2.89
1.68
05601XAC3 BMW Vehicle Lease Trust 2022‐1 A31.100% Due 03/25/2025 870,000.00 01/11/20221.11%869,869.94869,886.61 97.40 2.91%847,403.49 159.50 0.28% (22,483.12)NR / AAAAAA 2.901.45
47788UAC6 John Deere Owner Trust 2021‐A A3
0.360% Due 09/15/2025
765,000.00 03/02/2021
0.37%
764,852.97
764,899.59
96.53
3.15%
738,466.74
122.40
0.25%
(26,432.85)
Aaa / NR
AAA
3.38
1.25
44933LAC7 Hyundai Auto Receivables Trust 2021‐A A3
0.380% Due 09/15/2025
925,000.00 04/20/2021
0.38%
924,902.69
924,934.86
97.12
2.86%
898,405.33
156.22
0.30%
(26,529.53)
NR / AAA
AAA
3.38
1.16
44934KAC8 Hyundai Auto Receivables Trust 2021‐B A30.380% Due 01/15/2026 2,130,000.00 07/20/20210.39%2,129,529.912,129,643.63 96.20 3.12%2,049,115.38 359.73 0.68% (80,528.25)NR / AAAAAA 3.721.40
As of April 30, 2022
56
Holdings Report
City of Newport Beach, California Consolidated ‐Account #13
CUSIP Security Description Par Value/Units Purchase Date
Book Yield
Cost Value
Book Value
Mkt Price
Mkt YTM
Market Value
Accrued Int.
% of Port.
Gain/Loss
Moody/S&P
Fitch
Maturity
Duration
43815GAC3 Honda Auto Receivables Trust 2021‐4 A3
0.880% Due 01/21/2026
860,000.00 11/16/2021
0.89%
859,818.71
859,842.88
96.22
3.03%
827,454.16
210.22
0.27%
(32,388.72)
Aaa / NR
AAA
3.73
1.78
47789QAC4 John Deere Owner Trust 2021‐B A3
0.520% Due 03/16/2026
1,000,000.00 07/13/2021
0.52%
999,910.80
999,929.80
95.26
3.28%
952,600.00
231.11
0.32%
(47,329.80)
Aaa / NR
AAA
3.88
1.74
89238JAC9 Toyota Auto Receivables Trust 2021‐D A30.710% Due 04/15/2026 800,000.00 11/09/20210.71%799,982.96799,985.36 96.23 2.97%769,870.40 252.44 0.26% (30,114.96)NR / AAAAAA 3.961.69
44935FAD6 Hyundai Auto Receivables Trust 2021‐C A3
0.740% Due 05/15/2026
615,000.00 11/09/2021
0.75%
614,862.73
614,882.34
95.80
3.18%
589,172.46
202.27
0.20%
(25,709.88)
NR / AAA
AAA
4.04
1.75
362554AC1 GM Financial Securitized Term 2021‐4 A3
0.680% Due 09/16/2026
640,000.00 10/13/2021
0.68%
639,983.68
639,986.20
96.12
3.10%
615,168.00
181.33
0.20%
(24,818.20)
Aaa / AAA
NR
4.38
1.63
47787JAC2 John Deere Owner Trust 2022‐A A32.320% Due 09/16/2026 1,110,000.00 03/10/20222.34%1,109,754.471,109,763.30 97.78 3.57%1,085,344.68 1,144.53 0.36% (24,418.62)Aaa / NRAAA 4.381.81
380146AC4 GM Financial Auto Receivables 2022‐1 A3
1.260% Due 11/16/2026
575,000.00 01/11/2022
1.27%
574,950.03
574,954.23
96.07
4.65%
552,405.95
301.88
0.18%
(22,548.28)
NR / AAA
AAA
4.55
1.17
TOTAL ABS 23,833,822.44 0.90%
23,831,297.31
23,831,980.52 2.89%
23,195,037.34
7,920.99
7.71%
(636,943.18)
Aaa / AAA
Aaa
2.98
1.26
Agency
3130AEBM1 FHLB Note
2.750% Due 06/10/2022
3,000,000.00 Various
2.86%
2,987,747.50
2,999,658.61
100.22
0.73%
3,006,708.00
32,312.50
1.01%
7,049.39
Aaa / AA+
NR
0.11
0.11
313383WD9 FHLB Note
3.125% Due 09/09/2022
3,750,000.00 09/25/2018
3.01%
3,765,750.00
3,751,428.84
100.66
1.26%
3,774,903.75
16,927.08
1.26%
23,474.91
Aaa / AA+
AAA
0.36
0.36
3133EKHN9 FFCB Note
2.330% Due 10/18/2022
2,500,000.00 05/02/2019
2.37%
2,496,400.00
2,499,515.82
100.41
1.44%
2,510,322.50
2,103.47
0.83%
10,806.68
Aaa / AA+
AAA
0.47
0.46
3135G0T94 FNMA Note
2.375% Due 01/19/2023
1,600,000.00 10/04/2018
3.10%
1,554,000.00
1,592,279.51
100.41
1.80%
1,606,497.60
10,766.67
0.54%
14,218.09
Aaa / AA+
AAA
0.72
0.71
3133EKUA2 FFCB Note1.850% Due 02/01/2023 4,000,000.00 07/23/20191.87%3,997,160.003,999,391.43 100.11 1.70%4,004,488.00 18,500.00 1.34% 5,096.57 Aaa / AA+AAA 0.760.74
3133ELNW0 FFCB Note
1.450% Due 02/21/2023
2,290,000.00 02/19/2020
1.45%
2,290,274.80
2,290,074.22
99.58
1.98%
2,280,340.78
6,456.53
0.76%
(9,733.44)
Aaa / AA+
AAA
0.81
0.80
3130ADRG9 FHLB Note
2.750% Due 03/10/2023
4,800,000.00 01/18/2019
2.75%
4,800,576.00
4,800,119.55
100.61
2.03%
4,829,265.60
18,700.00
1.61%
29,146.05
Aaa / AA+
NR
0.86
0.85
3135G04Q3 FNMA Note0.250% Due 05/22/2023 4,000,000.00 08/11/20200.25%3,999,920.003,999,969.52 97.94 2.22%3,917,744.00 4,416.67 1.30% (82,225.52)Aaa / AA+AAA 1.061.05
3133834G3 FHLB Note
2.125% Due 06/09/2023
3,900,000.00 Various
2.13%
3,899,157.00
3,899,808.16
99.85
2.26%
3,894,150.00
32,689.58
1.30%
(5,658.16)
Aaa / AA+
NR
1.11
1.08
As of April 30, 2022
57
57
58
30
Holdings Report
City of Newport Beach, California Consolidated ‐Account #13
CUSIP Security Description Par Value/Units Purchase Date
Book Yield
Cost Value
Book Value
Mkt Price
Mkt YTM
Market Value
Accrued Int.
% of Port.
Gain/Loss
Moody/S&P
Fitch
Maturity
Duration
3133EKSN7 FFCB Note
1.770% Due 06/26/2023
4,000,000.00 06/21/2019
1.89%
3,981,400.00
3,994,640.25
99.38
2.31%
3,975,296.00
24,583.33
1.33%
(19,344.25)
Aaa / AA+
AAA
1.16
1.13
3135G05G4 FNMA Note
0.250% Due 07/10/2023
4,000,000.00 09/28/2020
0.23%
4,001,920.00
4,000,824.48
97.55
2.34%
3,902,148.00
3,083.33
1.30%
(98,676.48)
Aaa / AA+
AAA
1.19
1.18
3133EKZK5 FFCB Note
1.600% Due 08/14/2023
2,000,000.00 08/09/2019
1.63%
1,997,420.00
1,999,170.02
99.08
2.33%
1,981,606.00
6,844.44
0.66%
(17,564.02)
Aaa / AA+
AAA
1.29
1.26
3133EL3V4 FFCB Note
0.200% Due 08/14/2023
4,000,000.00 08/12/2020
0.27%
3,991,680.00
3,996,415.77
97.31
2.33%
3,892,516.00
1,711.11
1.29%
(103,899.77)
Aaa / AA+
AAA
1.29
1.27
3137EAEV7 FHLMC Note
0.250% Due 08/24/2023
4,000,000.00 09/23/2020
0.24%
4,000,960.00
4,000,433.08
97.23
2.40%
3,889,024.00
1,861.11
1.29%
(111,409.08)
Aaa / AA+
AAA
1.32
1.30
313383YJ4 FHLB Note
3.375% Due 09/08/2023
1,600,000.00 04/05/2019
2.37%
1,666,896.00
1,620,516.43
101.22
2.45%
1,619,574.40
7,950.00
0.54%
(942.03)
Aaa / AA+
NR
1.36
1.31
3137EAEY1 FHLMC Note
0.125% Due 10/16/2023
5,180,000.00 Various
0.25%
5,160,792.60
5,170,638.20
96.76
2.39%
5,012,349.30
269.79
1.67%
(158,288.90)
Aaa / AA+
AAA
1.46
1.44
3137EAEZ8 FHLMC Note0.250% Due 11/06/2023 4,275,000.00 11/03/20200.28%4,271,152.504,273,055.19 96.63 2.53%4,130,868.38 5,195.31 1.37% (142,186.81)Aaa / AA+AAA 1.521.49
3135G06H1 FNMA Note
0.250% Due 11/27/2023
3,775,000.00 11/23/2020
0.29%
3,770,696.50
3,772,744.29
96.49
2.54%
3,642,569.23
4,037.15
1.21%
(130,175.06)
Aaa / AA+
AAA
1.58
1.55
3137EAFA2 FHLMC Note
0.250% Due 12/04/2023
3,050,000.00 12/02/2020
0.28%
3,046,980.50
3,048,395.12
96.36
2.59%
2,939,019.65
3,113.54
0.98%
(109,375.47)
Aaa / AA+
AAA
1.60
1.57
3130A0F70 FHLB Note3.375% Due 12/08/2023 4,000,000.00 12/21/20182.84%4,098,680.004,031,948.33 101.22 2.60%4,048,680.00 53,625.00 1.36% 16,731.67 Aaa / AA+AAA 1.611.54
3133EKMX1 FFCB Note
2.230% Due 02/23/2024
2,000,000.00 07/30/2019
1.91%
2,027,800.00
2,011,050.00
99.55
2.49%
1,990,904.00
8,424.44
0.66%
(20,146.00)
Aaa / AA+
AAA
1.82
1.76
3130A7PH2 FHLB Note
1.875% Due 03/08/2024
4,000,000.00 03/03/2020
0.85%
4,161,400.00
4,074,585.53
98.59
2.66%
3,943,756.00
11,041.67
1.31%
(130,829.53)
Aaa / AA+
NR
1.86
1.80
3130AQF40 FHLB Note1.000% Due 12/20/2024 2,250,000.00 12/21/20211.03%2,248,020.002,248,255.28 95.38 2.83%2,145,984.75 8,062.50 0.72% (102,270.53)Aaa / AA+AAA 2.642.56
3133ENKS8 FFCB Note
1.125% Due 01/06/2025
2,000,000.00 01/06/2022
1.20%
1,995,500.00
1,995,953.71
95.57
2.85%
1,911,474.00
6,875.00
0.64%
(84,479.71)
Aaa / AA+
AAA
2.69
2.60
3133ENPY0 FFCB Note
1.750% Due 02/25/2025
4,000,000.00 03/03/2022
1.76%
3,999,280.00
3,999,318.35
96.99
2.87%
3,879,460.00
12,833.33
1.29%
(119,858.35)
Aaa / AA+
AAA
2.83
2.71
As of April 30, 2022
58
Holdings Report
City of Newport Beach, California Consolidated ‐Account #13
CUSIP Security Description Par Value/Units Purchase Date
Book Yield
Cost Value
Book Value
Mkt Price
Mkt YTM
Market Value
Accrued Int.
% of Port.
Gain/Loss
Moody/S&P
Fitch
Maturity
Duration
3135G05X7 FNMA Note
0.375% Due 08/25/2025
3,500,000.00 12/02/2021
1.15%
3,401,720.00
3,412,479.53
92.03
2.91%
3,221,221.50
2,406.25
1.07%
(191,258.03)
Aaa / AA+
AAA
3.32
3.25
TOTAL Agency 87,470,000.00 1.38%
87,613,283.40
87,482,669.22 2.26%
85,950,871.44
304,789.80
28.66%
(1,531,797.78)
Aaa / AA+
Aaa
1.39
1.36
CMO
3137B7YY9 FHLMC K037 A2
3.490% Due 01/25/2024
1,600,000.00 11/05/2021
0.58%
1,687,062.50
1,668,398.54
100.67
2.90%
1,610,769.60
4,653.33
0.54%
(57,628.94)
NR / AAA
NR
1.74
1.48
3137BFE98 FHLMC K041 A2
3.171% Due 10/25/2024
700,000.00 04/21/2022
2.96%
702,242.19
702,229.58
100.15
3.03%
701,029.70
1,849.75
0.23%
(1,199.88)
Aaa / AAA
AAA
2.49
2.27
3137BFXT3 FHLMC K042 A2
2.670% Due 12/25/2024
2,500,000.00 08/19/2021
0.62%
2,653,906.25
2,621,606.53
98.91
3.07%
2,472,672.50
1,112.50
0.82%
(148,934.03)
Aaa / NR
NR
2.66
2.40
TOTAL CMO 4,800,000.00 0.93%
5,043,210.94
4,992,234.65 3.01%
4,784,471.80
7,615.58
1.59%
(207,762.85)
Aaa / AAA
Aaa
2.32
2.07
Commercial Paper
21687BFN6 Rabobank Nederland NV NY Discount CP0.310% Due 06/22/2022 5,000,000.00 12/21/20210.31%4,992,163.894,992,163.89 99.84 0.31%4,992,163.89 5,597.22 1.66% 0.00 P‐1 / A‐1NR 0.150.14
78015DG61 Royal Bank of Canada NY Discount CP
0.330% Due 07/06/2022
1,800,000.00 12/22/2021
0.34%
1,796,782.50
1,796,782.50
99.82
0.34%
1,796,782.50
2,128.50
0.60%
0.00
P‐1 / A‐1+
NR
0.18
0.18
62479MH48 MUFG Bank Ltd/NY Discount CP
0.340% Due 08/04/2022
5,000,000.00 12/22/2021
0.35%
4,989,375.00
4,989,375.00
99.79
0.35%
4,989,375.00
6,138.89
1.66%
0.00
P‐1 / A‐1
NR
0.26
0.26
89233HJW5 Toyota Motor Credit Discount CP0.690% Due 09/30/2022 1,900,000.00 01/28/20220.70%1,891,077.921,891,077.92 99.53 0.70%1,891,077.92 3,386.75 0.63% 0.00 P‐1 / A‐1+F‐1 0.420.42
TOTAL Commercial Paper 13,700,000.00 0.38%
13,669,399.31
13,669,399.31 0.38%
13,669,399.31
17,251.36
4.55%
0.00
P‐1 / A‐1
F‐1
0.23
0.23
Corporate
92826CAC6 Visa Inc Callable Note Cont 10/14/2022
2.800% Due 12/14/2022
1,000,000.00 12/20/2018
3.28%
982,250.00
997,223.12
100.47
1.76%
1,004,717.00
10,655.56
0.34%
7,493.88
Aa3 / AA‐
NR
0.62
0.45
24422EUA5 John Deere Capital Corp Note
2.700% Due 01/06/2023
1,500,000.00 07/24/2018
3.38%
1,458,270.00
1,493,580.00
100.56
1.86%
1,508,452.50
12,937.50
0.51%
14,872.50
A2 / A
A
0.69
0.67
89236TEL5 Toyota Motor Credit Corp Note
2.700% Due 01/11/2023
1,000,000.00 09/07/2018
3.33%
974,710.00
995,926.12
100.24
2.35%
1,002,401.00
8,250.00
0.34%
6,474.88
A1 / A+
A+
0.70
0.68
As of April 30, 2022
59
59
60
31
Holdings Report
City of Newport Beach, California Consolidated ‐Account #13
CUSIP Security Description Par Value/Units Purchase Date
Book Yield
Cost Value
Book Value
Mkt Price
Mkt YTM
Market Value
Accrued Int.
% of Port.
Gain/Loss
Moody/S&P
Fitch
Maturity
Duration
69371RQ41 Paccar Financial Corp Note
1.900% Due 02/07/2023
1,000,000.00 10/31/2019
1.90%
999,950.00
999,988.13
99.74
2.24%
997,394.00
4,433.33
0.33%
(2,594.13)
A1 / A+
NR
0.78
0.76
084670BR8 Berkshire Hathaway Callable Note Cont 1/15/2023
2.750% Due 03/15/2023
1,000,000.00 12/20/2018
3.40%
974,780.00
994,798.99
100.43
2.14%
1,004,287.00
3,513.89
0.33%
9,488.01
Aa2 / AA
A+
0.87
0.70
037833AK6 Apple Inc Note
2.400% Due 05/03/2023
1,000,000.00 04/11/2019
2.70%
988,520.00
997,151.35
100.11
2.29%
1,001,089.00
11,866.67
0.34%
3,937.65
Aaa / AA+
NR
1.01
0.98
57629WCU2 Mass Mutual Global funding Note
0.850% Due 06/09/2023
2,000,000.00 12/15/2021
0.73%
2,003,660.00
2,002,743.30
97.93
2.76%
1,958,610.00
6,705.56
0.65%
(44,133.30)
Aa3 / AA+
AA+
1.11
1.09
931142EK5 Wal‐Mart Stores Callable Note Cont 5/26/2023
3.400% Due 06/26/2023
2,000,000.00 04/29/2019
2.67%
2,055,840.00
2,014,645.33
101.11
2.35%
2,022,116.00
23,611.11
0.68%
7,470.67
Aa2 / AA
AA
1.16
1.04
06406FAD5 Bank of NY Mellon Corp Callable Note Cont 6/16/2023
2.200% Due 08/16/2023
1,000,000.00 03/27/2019
2.78%
976,220.00
992,989.28
99.17
2.86%
991,691.00
4,583.33
0.33%
(1,298.28)
A1 / A
AA‐
1.30
1.26
89236TFS9 Toyota Motor Credit Corp Note
3.350% Due 01/08/2024
1,000,000.00 06/14/2019
2.41%
1,040,490.00
1,015,004.40
100.58
2.99%
1,005,818.00
10,515.28
0.34%
(9,186.40)
A1 / A+
A+
1.69
1.62
02665WCT6 American Honda Finance Note3.550% Due 01/12/2024 500,000.00 01/13/20202.06%528,405.00512,098.43 100.77 3.08%503,863.00 5,374.31 0.17% (8,235.43)A3 / A‐A 1.701.62
24422EVN6 John Deere Capital Corp Note
0.450% Due 01/17/2024
1,850,000.00 03/01/2021
0.47%
1,848,686.50
1,849,216.16
96.08
2.81%
1,777,509.60
2,405.00
0.59%
(71,706.56)
A2 / A
A
1.72
1.68
91159HHV5 US Bancorp Callable Note Cont 1/5/2024
3.375% Due 02/05/2024
2,000,000.00 Various
2.63%
2,064,710.00
2,023,469.85
100.41
3.12%
2,008,256.00
16,125.00
0.67%
(15,213.85)
A2 / A+
A+
1.77
1.61
637432NL5 National Rural Utilities Callable Note Cont 12/7/20232.950% Due 02/07/2024 1,317,000.00 04/06/20222.77%1,320,871.981,320,725.51 99.72 3.11%1,313,361.13 9,065.35 0.44% (7,364.38)A1 / A‐A+1.781.70
06051GHF9 Bank of America Corp Callable Note 1X 3/5/2023
3.550% Due 03/05/2024
1,565,000.00 04/26/2021
0.64%
1,648,852.70
1,603,205.08
100.08
2.80%
1,566,244.18
8,642.28
0.52%
(36,960.90)
A2 / A‐
AA‐
1.85
1.77
808513BN4 Charles Schwab Corp Callable Note Cont 2/18/2024
0.750% Due 03/18/2024
2,230,000.00 Various
0.71%
2,232,745.00
2,231,696.31
95.79
3.07%
2,136,034.49
1,997.71
0.71%
(95,661.82)
A2 / A
A
1.88
1.84
023135BW5 Amazon.com Inc Note0.450% Due 05/12/2024 1,835,000.00 05/10/20210.50%1,832,320.901,833,186.23 95.50 2.74%1,752,401.15 3,876.44 0.58% (80,785.08)A1 / AAAA‐2.041.99
91324PEB4 United Health Group Inc Callable Note Cont 5/15/2022
0.550% Due 05/15/2024
1,135,000.00 11/08/2021
0.78%
1,128,485.10
1,129,707.09
95.23
2.97%
1,080,907.03
2,878.49
0.36%
(48,800.06)
A3 / A+
A
2.04
2.00
14913R2L0 Caterpillar Financial Service Note
0.450% Due 05/17/2024
2,910,000.00 05/10/2021
0.50%
2,906,100.60
2,907,342.29
95.00
2.99%
2,764,386.51
5,965.50
0.92%
(142,955.78)
A2 / A
A
2.05
2.01
As of April 30, 2022
60
Holdings Report
City of Newport Beach, California Consolidated ‐Account #13
CUSIP Security Description Par Value/Units Purchase Date
Book Yield
Cost Value
Book Value
Mkt Price
Mkt YTM
Market Value
Accrued Int.
% of Port.
Gain/Loss
Moody/S&P
Fitch
Maturity
Duration
89114QCA4 Toronto Dominion Bank Note
2.650% Due 06/12/2024
2,000,000.00 04/23/2021
0.63%
2,124,500.00
2,084,271.89
98.90
3.19%
1,977,920.00
20,463.89
0.66%
(106,351.89)
A1 / A
AA‐
2.12
2.02
06051GJY6 Bank of America Corp Callable Note Cont 6/14/2023
0.523% Due 06/14/2024
1,000,000.00 06/10/2021
0.52%
1,000,060.00
1,000,033.62
96.72
2.20%
967,155.00
1,990.31
0.32%
(32,878.62)
A2 / A‐
AA‐
2.13
2.08
89236TJH9 Toyota Motor Credit Corp Note0.500% Due 06/18/2024 890,000.00 06/15/20210.54%888,940.90889,247.23 94.67 3.10%842,584.36 1,644.03 0.28% (46,662.87)A1 / A+A+2.142.09
06367TQW3 Bank of Montreal Note
0.625% Due 07/09/2024
2,000,000.00 09/10/2021
0.65%
1,998,380.00
1,998,740.52
94.16
3.41%
1,883,256.00
3,888.89
0.63%
(115,484.52)
A2 / A‐
AA‐
2.19
2.14
79466LAG9 Salesforce.com Inc Callable Note Cont 7/15/2022
0.625% Due 07/15/2024
470,000.00 06/29/2021
0.64%
469,760.30
469,824.21
94.78
3.09%
445,473.52
864.93
0.15%
(24,350.69)
A2 / A+
NR
2.21
2.16
69371RR40 Paccar Financial Corp Note0.500% Due 08/09/2024 700,000.00 08/05/20210.52%699,555.00699,662.59 94.31 3.11%660,135.00 797.22 0.22% (39,527.59)A1 / A+NR 2.282.23
037833DM9 Apple Inc Callable Note Cont 8/11/2024
1.800% Due 09/11/2024
1,000,000.00 08/18/2021
0.58%
1,035,810.00
1,027,442.25
97.75
2.79%
977,506.00
2,500.00
0.33%
(49,936.25)
Aaa / AA+
NR
2.37
2.29
59217GEP0 Metlife Note
0.700% Due 09/27/2024
1,555,000.00 Various
0.85%
1,548,375.40
1,549,399.44
93.81
3.40%
1,458,673.97
1,028.03
0.48%
(90,725.47)
Aa3 / AA‐
AA‐
2.41
2.35
78015K7C2 Royal Bank of Canada Note2.250% Due 11/01/2024 2,500,000.00 05/19/20210.74%2,628,225.002,593,115.77 97.05 3.49%2,426,220.00 28,125.00 0.82% (166,895.77)A1 / AAA‐2.512.38
69371RR57 Paccar Financial Corp Note
0.900% Due 11/08/2024
2,120,000.00 11/02/2021
0.90%
2,119,872.80
2,119,892.99
94.92
3.01%
2,012,301.88
9,169.00
0.67%
(107,591.11)
A1 / A+
NR
2.53
2.45
74153WCQ0 Pricoa Global Funding Note
1.150% Due 12/06/2024
1,655,000.00 12/01/2021
1.19%
1,653,295.35
1,653,519.73
94.72
3.29%
1,567,599.45
7,560.13
0.52%
(85,920.28)
Aa3 / AA‐
AA‐
2.61
2.51
64952WEK5 New York Life Global Note
1.450% Due 01/14/2025
3,255,000.00 01/11/2022
1.49%
3,251,484.60
3,251,827.80
95.29
3.28%
3,101,601.62
14,028.15
1.04%
(150,226.18)
Aaa / AA+
AAA
2.71
2.61
63743HFC1 National Rural Utilities Note
1.875% Due 02/07/2025
1,000,000.00 03/18/2022
2.76%
975,700.00
976,623.08
95.73
3.51%
957,255.00
4,375.00
0.32%
(19,368.08)
A2 / A‐
A
2.78
2.65
46647PAH9 JP Morgan Chase & Co Callable Note 2X 3/1/2024
3.220% Due 03/01/2025
2,000,000.00 04/23/2021
0.89%
2,130,820.00
2,084,359.38
99.15
3.28%
1,983,012.00
10,733.33
0.66%
(101,347.38)
A2 / A‐
AA‐
2.84
2.67
57636QAN4 MasterCard Inc Callable Note 1x 02/03/2025
2.000% Due 03/03/2025
3,000,000.00 10/28/2021
1.04%
3,091,470.00
3,077,557.34
97.22
3.03%
2,916,528.00
9,666.67
0.97%
(161,029.34)
A1 / A+
NR
2.84
2.73
24422EWB1 John Deere Capital Corp Note
2.125% Due 03/07/2025
670,000.00 03/02/2022
2.14%
669,711.90
669,726.36
97.01
3.23%
649,986.43
2,135.63
0.22%
(19,739.93)
A2 / A
A
2.85
2.73
59217GEW5 Metlife Note
2.800% Due 03/21/2025
970,000.00 03/14/2022
2.83%
969,136.70
969,168.99
98.03
3.52%
950,916.22
3,017.78
0.32%
(18,252.77)
Aa3 / AA‐
AA‐
2.89
2.74
As of April 30, 2022
61
61
62
32
Holdings Report
City of Newport Beach, California Consolidated ‐Account #13
CUSIP Security Description Par Value/Units Purchase Date
Book Yield
Cost Value
Book Value
Mkt Price
Mkt YTM
Market Value
Accrued Int.
% of Port.
Gain/Loss
Moody/S&P
Fitch
Maturity
Duration
87612EBL9 Target Corp Callable Note Cont 4/15/25
2.250% Due 04/15/2025
3,000,000.00 03/15/2022
2.53%
2,975,610.00
2,976,585.60
97.14
3.27%
2,914,164.00
3,000.00
0.97%
(62,421.60)
A2 / A
A
2.96
2.83
06406RBC0 Bank of NY Mellon Corp Callable Note Cont 3/25/2025
3.350% Due 04/25/2025
1,475,000.00 04/19/2022
3.35%
1,474,793.50
1,474,794.44
99.86
3.40%
1,472,942.38
686.28
0.49%
(1,852.06)
A1 / A
AA‐
2.99
2.82
46647PCH7 JP Morgan Chase & Co Callable Note Cont 6/1/2024
0.824% Due 06/01/2025
1,000,000.00 05/26/2021
0.75%
1,002,160.00
1,001,501.75
94.12
2.83%
941,222.00
3,433.33
0.31%
(60,279.75)
A2 / A‐
AA‐
3.09
3.00
26442UAA2 Duke Energy Progress LLC Callable Note Cont 5/15/25
3.250% Due 08/15/2025
2,422,000.00 Various
3.25%
2,421,770.62
2,421,756.98
99.38
3.45%
2,406,886.72
16,617.61
0.81%
(14,870.26)
Aa3 / A
NR
3.30
3.07
857477BR3 State Street Bank Callable Note Cont 2/6/2025
1.746% Due 02/06/2026
900,000.00 02/02/2022
1.75%
900,000.00
900,000.00
95.27
3.17%
857,401.20
3,666.60
0.29%
(42,598.80)
A1 / A
AA‐
3.78
3.58
TOTAL Corporate 63,424,000.00 1.56%
63,995,299.85
63,803,748.93 2.99%
61,770,279.34
302,794.12
20.62%
(2,033,469.59)
A1 / A+
AA‐
2.16
2.06
Money Market Fund
60934N104 Federated Investors Government Obligations Fund 134,194.55 Various
0.20%
134,194.55
134,194.55
1.00
0.20%
134,194.55
0.00
0.04%
0.00
Aaa / AAA
AAA
0.00
0.00
38141W323 Goldman Sachs Financial Square Treasury Obligation Fund 97,119.59 Various0.28%97,119.5997,119.59 1.00 0.28%97,119.59 0.00 0.03% 0.00 Aaa / AAANR 0.000.00
TOTAL Money Market Fund 231,314.14 0.23%
231,314.14
231,314.14 0.23%
231,314.14
0.00
0.08%
0.00
Aaa / AAA
Aaa
0.00
0.00
Municipal Bonds
649791PP9 New York St Taxable‐GO
2.010% Due 02/15/2024
2,000,000.00 10/29/2019
2.01%
2,000,000.00
2,000,000.00
98.55
2.84%
1,971,040.00
8,486.67
0.66%
(28,960.00)
Aa1 / AA+
AA+
1.80
1.74
TOTAL Municipal Bonds 2,000,000.00 2.01%
2,000,000.00
2,000,000.00 2.84%
1,971,040.00
8,486.67
0.66%
(28,960.00)
Aa1 / AA+
AA+
1.80
1.74
As of April 30, 2022
62
Holdings Report
City of Newport Beach, California Consolidated ‐Account #13
CUSIP Security Description Par Value/Units Purchase Date
Book Yield
Cost Value
Book Value
Mkt Price
Mkt YTM
Market Value
Accrued Int.
% of Port.
Gain/Loss
Moody/S&P
Fitch
Maturity
Duration
Negotiable CD
89114WNP6 Toronto Dominion Yankee CD
0.350% Due 08/29/2022
2,200,000.00 12/23/2021
0.35%
2,200,000.00
2,200,000.00
99.60
1.53%
2,191,299.00
2,759.17
0.73%
(8,701.00)
P‐1 / A‐1+
F‐1+
0.33
0.33
TOTAL Negotiable CD 2,200,000.00 0.35%
2,200,000.00
2,200,000.00 1.53%
2,191,299.00
2,759.17
0.73%
(8,701.00)
Aaa / AAA
Aaa
0.33
0.33
Supranational
459058JM6 Intl. Bank Recon & Development Note
0.250% Due 11/24/2023
3,565,000.00 Various
0.28%
3,562,215.25
3,563,558.30
96.39
2.62%
3,436,267.85
3,886.84
1.14%
(127,290.45)
Aaa / AAA
AAA
1.57
1.54
459058GQ0 Intl. Bank Recon & Development Note
2.500% Due 03/19/2024
2,350,000.00 01/26/2021
0.26%
2,514,359.00
2,448,672.77
99.60
2.72%
2,340,642.30
6,854.17
0.78%
(108,030.47)
Aaa / AAA
AAA
1.89
1.82
4581X0DZ8 Inter‐American Dev Bank Note
0.500% Due 09/23/2024
3,955,000.00 09/15/2021
0.52%
3,952,073.30
3,952,660.78
94.60
2.85%
3,741,390.45
2,087.36
1.24%
(211,270.33)
Aaa / AAA
NR
2.40
2.35
45950KCR9 International Finance Corp Note
1.375% Due 10/16/2024
2,500,000.00 07/12/2021
0.54%
2,567,250.00
2,550,804.83
96.62
2.80%
2,415,580.00
1,432.29
0.80%
(135,224.83)
Aaa / AAA
NR
2.47
2.39
TOTAL Supranational 12,370,000.00 0.41%
12,595,897.55
12,515,696.68 2.75%
11,933,880.60
14,260.66
3.97%
(581,816.08)
Aaa / AAA
Aaa
2.07
2.02
US Treasury
9128282P4 US Treasury Note
1.875% Due 07/31/2022
5,000,000.00 12/23/2019
1.68%
5,024,609.38
5,002,357.32
100.23
0.96%
5,011,525.00
23,308.01
1.67%
9,167.68
Aaa / AA+
AAA
0.25
0.25
912828YA2 US Treasury Note
1.500% Due 08/15/2022
5,000,000.00 12/24/2019
1.69%
4,975,976.56
4,997,355.68
100.13
1.05%
5,006,640.00
15,538.67
1.67%
9,284.32
Aaa / AA+
AAA
0.29
0.29
91282CAG6 US Treasury Note0.125% Due 08/31/2022 5,000,000.00 04/27/20221.09%4,983,593.754,983,987.50 99.66 1.16%4,982,810.00 1,052.99 1.66% (1,177.50)Aaa / AA+AAA 0.340.33
912828YF1 US Treasury Note
1.500% Due 09/15/2022
3,000,000.00 01/27/2022
0.49%
3,018,984.38
3,011,308.09
100.10
1.23%
3,003,048.00
5,747.28
1.00%
(8,260.09)
Aaa / AA+
AAA
0.38
0.37
912828L57 US Treasury Note
1.750% Due 09/30/2022
5,000,000.00 04/05/2022
1.12%
5,015,039.06
5,012,914.90
100.18
1.33%
5,008,790.00
7,411.20
1.67%
(4,124.90)
Aaa / AA+
AAA
0.42
0.42
912828M49 US Treasury Note1.875% Due 10/31/2022 5,000,000.00 03/02/20220.82%5,034,765.635,026,289.71 100.21 1.44%5,010,740.00 254.76 1.66% (15,549.71)Aaa / AA+AAA 0.500.50
912828M80 US Treasury Note
2.000% Due 11/30/2022
4,000,000.00 Various
1.66%
4,040,390.63
4,007,804.29
100.23
1.60%
4,009,220.00
33,406.60
1.34%
1,415.71
Aaa / AA+
AAA
0.59
0.58
912828R28 US Treasury Note
1.625% Due 04/30/2023
4,000,000.00 12/04/2019
1.60%
4,003,593.75
4,001,053.24
99.48
2.15%
3,979,220.00
176.63
1.32%
(21,833.24)
Aaa / AA+
AAA
1.00
0.99
As of April 30, 2022
63
63
64
33
Holdings Report
City of Newport Beach, California Consolidated ‐Account #13
CUSIP Security Description Par Value/Units Purchase Date
Book Yield
Cost Value
Book Value
Mkt Price
Mkt YTM
Market Value
Accrued Int.
% of Port.
Gain/Loss
Moody/S&P
Fitch
Maturity
Duration
912828R69 US Treasury Note
1.625% Due 05/31/2023
2,400,000.00 04/11/2019
2.30%
2,336,250.00
2,383,290.48
99.36
2.23%
2,384,532.00
16,285.71
0.80%
1,241.52
Aaa / AA+
AAA
1.08
1.06
91282CBA8 US Treasury Note
0.125% Due 12/15/2023
2,300,000.00 01/08/2021
0.22%
2,293,441.41
2,296,358.39
96.14
2.57%
2,211,144.10
1,082.07
0.74%
(85,214.29)
Aaa / AA+
AAA
1.63
1.60
91282CBE0 US Treasury Note
0.125% Due 01/15/2024
4,000,000.00 01/12/2021
0.24%
3,985,781.25
3,991,897.26
95.88
2.60%
3,835,156.00
1,464.09
1.27%
(156,741.26)
Aaa / AA+
AAA
1.71
1.69
91282CBV2 US Treasury Note
0.375% Due 04/15/2024
5,000,000.00 04/23/2021
0.32%
5,008,398.44
5,005,534.46
95.60
2.70%
4,780,080.00
819.67
1.59%
(225,454.46)
Aaa / AA+
AAA
1.96
1.93
91282CCC3 US Treasury Note
0.250% Due 05/15/2024
3,000,000.00 05/26/2021
0.30%
2,995,312.50
2,996,778.42
95.13
2.72%
2,853,867.00
3,459.94
0.95%
(142,911.42)
Aaa / AA+
AAA
2.04
2.01
91282CCL3 US Treasury Note
0.375% Due 07/15/2024
3,500,000.00 07/13/2021
0.46%
3,490,703.13
3,493,163.07
94.92
2.76%
3,322,266.50
3,843.23
1.11%
(170,896.57)
Aaa / AA+
AAA
2.21
2.17
912828YE4 US Treasury Note
1.250% Due 08/31/2024
4,000,000.00 02/24/2021
0.33%
4,128,125.00
4,085,183.65
96.52
2.80%
3,860,624.00
8,423.91
1.29%
(224,559.65)
Aaa / AA+
AAA
2.34
2.27
91282CCX7 US Treasury Note0.375% Due 09/15/2024 5,000,000.00 09/08/20210.44%4,990,234.384,992,265.91 94.42 2.82%4,720,900.00 2,394.70 1.57% (271,365.91)Aaa / AA+AAA 2.382.33
91282CDB4 US Treasury Note
0.625% Due 10/15/2024
1,800,000.00 12/29/2021
0.94%
1,784,460.94
1,786,319.53
94.82
2.82%
1,706,835.60
491.80
0.57%
(79,483.93)
Aaa / AA+
AAA
2.46
2.41
912828YM6 US Treasury Note
1.500% Due 10/31/2024
4,500,000.00 08/05/2021
0.42%
4,655,917.97
4,620,566.01
96.80
2.84%
4,355,860.50
183.42
1.45%
(264,705.51)
Aaa / AA+
AAA
2.51
2.43
91282CDH1 US Treasury Note0.750% Due 11/15/2024 5,000,000.00 11/17/20210.85%4,985,156.254,987,383.49 94.89 2.85%4,744,530.00 17,299.72 1.58% (242,853.49)Aaa / AA+AAA 2.552.48
912828Z52 US Treasury Note
1.375% Due 01/31/2025
3,000,000.00 02/16/2021
0.37%
3,117,656.25
3,081,968.27
96.09
2.86%
2,882,577.00
10,255.52
0.96%
(199,391.27)
Aaa / AA+
AAA
2.76
2.66
912828ZC7 US Treasury Note
1.125% Due 02/28/2025
2,700,000.00 01/26/2022
1.42%
2,676,058.59
2,678,053.71
95.32
2.86%
2,573,542.80
5,117.53
0.86%
(104,510.91)
Aaa / AA+
AAA
2.84
2.75
912828ZF0 US Treasury Note0.500% Due 03/31/2025 2,900,000.00 03/17/20210.64%2,884,140.632,888,541.23 93.42 2.87%2,709,235.10 1,228.14 0.90% (179,306.13)Aaa / AA+AAA 2.922.86
912828ZL7 US Treasury Note
0.375% Due 04/30/2025
5,000,000.00 Various
0.50%
4,974,296.88
4,980,901.34
92.87
2.87%
4,643,360.00
50.95
1.54%
(337,541.34)
Aaa / AA+
AAA
3.00
2.94
912828ZT0 US Treasury Note
0.250% Due 05/31/2025
5,000,000.00 10/05/2021
0.70%
4,919,335.94
4,931,862.17
92.25
2.89%
4,612,695.00
5,219.78
1.53%
(319,167.17)
Aaa / AA+
AAA
3.09
3.03
As of April 30, 2022
64
Holdings Report
City of Newport Beach, California Consolidated ‐Account #13
CUSIP Security Description Par Value/Units Purchase Date
Book Yield
Cost Value
Book Value
Mkt Price
Mkt YTM
Market Value
Accrued Int.
% of Port.
Gain/Loss
Moody/S&P
Fitch
Maturity
Duration
912828K74 US Treasury Note
2.000% Due 08/15/2025
2,300,000.00 04/05/2022
2.77%
2,243,218.75
2,244,375.66
97.15
2.91%
2,234,502.90
9,530.39
0.75%
(9,872.76)
Aaa / AA+
AAA
3.30
3.15
TOTAL US Treasury 97,400,000.00 0.90%
97,565,441.45
97,487,513.78 2.23%
94,443,701.50
174,046.71
31.44%
(3,043,812.28)
Aaa / AA+
Aaa
1.67
1.63
TOTAL PORTFOLIO 307,429,136.58 1.13%
308,745,143.95
308,214,557.23 2.39%
300,141,294.47
839,925.06
100.00%
(8,073,262.76)
Aa1 / AA+
Aaa
1.74
1.56
TOTAL MARKET VALUE PLUS ACCRUALS 300,981,219.53
As of April 30, 2022
65
65
66
34
Holdings Report
Newport Beach 10B Cops Lease Pymt ‐Account #10543
CUSIP Security Description Par Value/Units Purchase Date
Book Yield
Cost Value
Book Value
Mkt Price
Mkt YTM
Market Value
Accrued Int.
% of Port.
Gain/Loss
Moody/S&P
Fitch
Maturity
Duration
Money Market Fund
60934N872 Federated Investors US Treasury Cash Reserves 632 2,855.14 Various
0.01%
2,855.14
2,855.14
1.00
0.01%
2,855.14
0.00
0.26%
0.00
Aaa / AAA
NR
0.00
0.00
TOTAL Money Market Fund 2,855.14 0.01%
2,855.14
2,855.14 0.01%
2,855.14
0.00
0.26%
0.00
Aaa / AAA
NR
0.00
0.00
US Treasury
912796Q36 US Treasury Bill
0.160% Due 05/26/2022
1,095,000.00 01/12/2022
0.16%
1,094,354.76
1,094,354.76
99.94
0.16%
1,094,354.76
523.95
99.74%
0.00
P‐1 / A‐1+
F‐1+
0.07
0.07
TOTAL US Treasury 1,095,000.00 0.16%
1,094,354.76
1,094,354.76 0.16%
1,094,354.76
523.95
99.74%
0.00
Aaa / AAA
Aaa
0.07
0.07
TOTAL PORTFOLIO 1,097,855.14 0.16%
1,097,209.90
1,097,209.90 0.16%
1,097,209.90
523.95
100.00%
0.00
Aaa / AAA
Aaa
0.07
0.07
TOTAL MARKET VALUE PLUS ACCRUALS 1,097,733.85
As of April 30, 2022
66
Holdings Report
Newport Beach AD 117 Reserve FD ‐Account #10627
CUSIP Security Description Par Value/Units Purchase Date
Book Yield
Cost Value
Book Value
Mkt Price
Mkt YTM
Market Value
Accrued Int.
% of Port.
Gain/Loss
Moody/S&P
Fitch
Maturity
Duration
Money Market Fund
31846V302 First American Treasury MMF Class D 710.30 Various
0.01%
710.30
710.30
1.00
0.01%
710.30
0.00
0.54%
0.00
Aaa / AAA
AAA
0.00
0.00
TOTAL Money Market Fund 710.30 0.01%
710.30
710.30 0.01%
710.30
0.00
0.54%
0.00
Aaa / AAA
Aaa
0.00
0.00
US Treasury
912796K57 US Treasury Bill
0.483% Due 07/14/2022
65,000.00 02/09/2022
0.49%
64,865.84
64,865.84
99.79
0.49%
64,865.84
69.69
49.65%
0.00
P‐1 / A‐1+
F‐1+
0.21
0.20
912828Z29 US Treasury Note
1.500% Due 01/15/2023
65,000.00 02/09/2022
0.90%
65,358.01
65,273.52
99.79
1.79%
64,865.45
285.50
49.81%
(408.07)
Aaa / AA+
AAA
0.71
0.70
TOTAL US Treasury 130,000.00 0.70%
130,223.85
130,139.36 1.14%
129,731.29
355.19
99.46%
(408.07)
Aaa / AAA
Aaa
0.46
0.45
TOTAL PORTFOLIO 130,710.30 0.69%
130,934.15
130,849.66 1.14%
130,441.59
355.19
100.00%
(408.07)
Aaa / AAA
Aaa
0.46
0.45
TOTAL MARKET VALUE PLUS ACCRUALS 130,796.78
As of April 30, 2022
67
67
68
35
SECTION |Section 6 | Transactions
Transaction Ledger
City of Newport Beach, California Consolidated ‐Account #13
Transaction
Type
Settlement
Date CUSIP Quantity Security Description Price
Acq/Disp
Yield Amount Interest
Pur/Sold Total Amount Gain/Loss
ACQUISITIONS
Purchase 02/07/2022 857477BR3 900,000.00 State Street Bank Callable Note Cont 2/6/2025
1.746% Due: 02/06/2026
100.000 1.75% 900,000.00 0.00 900,000.00 0.00
Purchase 02/23/2022 36265MAC9 1,835,000.00 GM Financial Auto Lease Trust 2022‐1 A3
1.9% Due: 03/20/2025
99.999 1.91% 1,834,984.22 0.00 1,834,984.22 0.00
Purchase 03/03/2022 912828M49 5,000,000.00 US Treasury Note
1.875% Due: 10/31/2022
100.695 0.82% 5,034,765.63 31,854.28 5,066,619.91 0.00
Purchase 03/04/2022 3133ENPY0 4,000,000.00 FFCB Note
1.75% Due: 02/25/2025
99.982 1.76% 3,999,280.00 1,750.00 4,001,030.00 0.00
Purchase 03/07/2022 24422EWB1 670,000.00 John Deere Capital Corp Note
2.125% Due: 03/07/2025
99.957 2.14% 669,711.90 0.00 669,711.90 0.00
Purchase 03/16/2022 47787JAC2 1,110,000.00 John Deere Owner Trust 2022‐A A3
2.32% Due: 09/16/2026
99.978 2.34% 1,109,754.47 0.00 1,109,754.47 0.00
Purchase 03/17/2022 87612EBL9 3,000,000.00 Target Corp Callable Note Cont 4/15/25
2.25% Due: 04/15/2025
99.187 2.53% 2,975,610.00 28,500.00 3,004,110.00 0.00
Purchase 03/21/2022 59217GEW5 970,000.00 Metlife Note
2.8% Due: 03/21/2025
99.911 2.83% 969,136.70 0.00 969,136.70 0.00
Purchase 03/22/2022 63743HFC1 1,000,000.00 National Rural Utilities Note
1.875% Due: 02/07/2025
97.570 2.76% 975,700.00 2,343.75 978,043.75 0.00
Purchase 04/06/2022 912828K74 2,300,000.00 US Treasury Note
2% Due: 08/15/2025
97.531 2.77% 2,243,218.75 6,353.59 2,249,572.34 0.00
Purchase 04/06/2022 912828L57 5,000,000.00 US Treasury Note
1.75% Due: 09/30/2022
100.301 1.12% 5,015,039.06 1,434.43 5,016,473.49 0.00
Purchase 04/08/2022 637432NL5 1,317,000.00 National Rural Utilities Callable Note Cont
12/7/2023
2.95% Due: 02/07/2024
100.294 2.77% 1,320,871.98 6,583.17 1,327,455.15 0.00
Purchase 04/20/2022 26442UAA2 1,422,000.00 Duke Energy Progress LLC Callable Note Cont
5/15/25
3.25% Due: 08/15/2025
100.121 3.21% 1,423,720.62 8,344.38 1,432,065.00 0.00
Purchase 04/26/2022 06406RBC0 1,475,000.00 Bank of NY Mellon Corp Callable Note Cont
3/25/2025
3.35% Due: 04/25/2025
99.986 3.35% 1,474,793.50 0.00 1,474,793.50 0.00
January 31, 2022 through April 30, 2022
As of April 30, 2022
69
69
70
36
Transaction Ledger
City of Newport Beach, California Consolidated ‐Account #13
Transaction
Type
Settlement
Date CUSIP Quantity Security Description Price
Acq/Disp
Yield Amount Interest
Pur/Sold Total Amount Gain/Loss
Purchase 04/26/2022 3137BFE98 700,000.00 FHLMC K041 A2
3.171% Due: 10/25/2024
100.320 2.96% 702,242.19 1,541.46 703,783.65 0.00
Purchase 04/28/2022 91282CAG6 5,000,000.00 US Treasury Note
0.125% Due: 08/31/2022
99.672 1.09% 4,983,593.75 1,002.04 4,984,595.79 0.00
Purchase 04/29/2022 26442UAA2 1,000,000.00 Duke Energy Progress LLC Callable Note Cont
5/15/25
3.25% Due: 08/15/2025
99.805 3.31% 998,050.00 6,680.56 1,004,730.56 0.00
Subtotal 36,699,000.00 36,630,472.77 96,387.66 36,726,860.43 0.00
TOTAL ACQUISITIONS 36,699,000.00 36,630,472.77 96,387.66 36,726,860.43 0.00
DISPOSITIONS
Sale 03/04/2022 912828W89 3,000,000.00 US Treasury Note
1.875% Due: 03/31/2022
100.129 2.20% 3,003,867.19 23,952.61 3,027,819.80 4,559.46
Sale 03/14/2022 912828YK0 5,000,000.00 US Treasury Note
1.375% Due: 10/15/2022
100.297 1.57% 5,014,843.75 28,331.04 5,043,174.79 20,585.20
Sale 04/07/2022 912828L24 2,800,000.00 US Treasury Note
1.875% Due: 08/31/2022
100.340 2.92% 2,809,515.63 5,421.20 2,814,936.83 20,475.44
Sale 04/21/2022 3130AFE78 2,500,000.00 FHLB Note
3% Due: 12/09/2022
100.925 2.77% 2,523,125.00 27,500.00 2,550,625.00 19,650.60
Subtotal 13,300,000.00 13,351,351.57 85,204.85 13,436,556.42 65,270.70
TOTAL DISPOSITIONS 13,300,000.00 13,351,351.57 85,204.85 13,436,556.42 65,270.70
January 31, 2022 through April 30, 2022
As of April 30, 2022
70
Important Disclosures
2022 Chandler Asset Management, Inc, An Independent Registered Investment Adviser.
Information contained herein is confidential. Prices are provided by IDC, an independent pricing source. In the event IDC does not provide a price or if the price provided is not reflective of fair market
value, Chandler will obtain pricing from an alternative approved third party pricing source in accordance with our written valuation policy and procedures. Our valuation procedures are also disclosed in
Item 5 of our Form ADV Part 2A.
Performance results are presented gross‐of‐advisory fees and represent the client’s Total Return. The deduction of advisory fees lowers performance results. These results include the reinvestment of
dividends and other earnings. Past performance may not be indicative of future results. Therefore, clients should not assume that future performance of any specific investment or investment strategy
will be profitable or equal to past performance levels. All investment strategies have the potential for profit or loss. Economic factors, market conditions or changes in investment strategies,
contributions or withdrawals may materially alter the performance and results of your portfolio.
Index returns assume reinvestment of all distributions. Historical performance results for investment indexes generally do not reflect the deduction of transaction and/or custodial charges or the
deduction of an investment management fee, the incurrence of which would have the effect of decreasing historical performance results. It is not possible to invest directly in an index.
Source ice Data Indices, LLC ("ICE"), used with permission. ICE permits useof the ICE indices and related data on an "as is" basis; ICE, its affiliates and their respective third party suppliers disclaim any and
all warranties and representations, express and/or implied, including any warranties of merchantability or fitness for a particular purpose or use, including the indices, index data and any data included
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Ratings information have been provided by Moody’s, S&P and Fitch through data feeds we believe to be reliable as of the date of this statement, however we cannot guarantee its accuracy.
Security level ratings for U.S. Agency issued mortgage‐backed securities (“MBS”) reflect the issuer rating because the securities themselves are not rated. The issuing U.S. Agency guarantees the full and
timely payment of both principal and interest and carries a AA+/Aaa/AAA by S&P, Moody’s and Fitch respectively.
As of April 30, 2022
71
71
72
37
Benchmark Disclosures
ICE BofA 1‐3 Yr US Treasury Index
The ICE BofA 1‐3 Year US Treasury Index tracks the performance of US dollar‐denominated sovereign debt publicly issued by the US government in its domestic market. Qualifying securities must have at
least one year remaining term to final maturity and less than three years remaining term to final maturity, a fixed coupon schedule, and a minimum amount outstanding of $1 billion. Qualifying securities
must haveat least 18 months to final maturity at the time of issuance.
ICE BofA 1‐3 Yr AAA‐A US Corp & Govt Index
The ICE BofA 1‐3AAA‐A Year US Corporate & Government Index tracks the performance of US dollar denominated investment grade debt publicly issued in the US domestic market, including US Treasury,
US agency, foreign government, supranational, and corporate securities. Qualifying securities must be rated AAA through A3 (based on an average of Moody’s, S&P and Fitch). In addition, qualifying
securities must have at least one year remaining term to final maturity and less than three years remaining term to final maturity, at least 18 months tofinal maturity at point of issuance, a fixed coupon
schedule, and a minimum amount outstanding of $1 billion for US Treasuries and $250million for all other securities.
As of April 30, 2022
ICE BofA 1‐3 Year US Treasury & Agency Index
The ICE BofA 1‐3 Year US Treasury & Agency Index tracks the performance of US dollar denominated US Treasury and nonsubordinated US agency debt issued in the US domestic market. Qualifying
securities must have an investment grade rating (based on an average of Moody’s, S&P and Fitch). Qualifying securities must have at least one year remaining term to final maturity and less than three
years remaining term to final maturity, at least 18 months to maturity at time of issuance, a fixed coupon schedule, and a minimum amount outstanding of $1 billion for sovereigns and $250 million for
agencies.
ICE BofA 1‐5 Year US Treasury & Agency Index
The ICE BofA 1‐5 Year US Treasury & Agency Index tracks the performance of US dollar denominated US Treasury and nonsubordinated US agency debt issued in the US domestic market. Qualifying
securities must have an investment grade rating (based on an average of Moody’s, S&P and Fitch). Qualifying securities must have at least one year remaining term to final maturity and less than five
years remaining term to final maturity, at least 18 months to maturity at time of issuance, a fixed coupon schedule, and a minimum amount outstanding of $1 billion for sovereigns and $250 million for
agencies.
ICE BofA 0‐5 Year US Treasury Index
The ICE BofA 0‐5 Year US Treasury Index tracks the performance of US Dollar denominated Sovereign debt publicly issued by the US government in its domestic market with maturities less than five years.
Qualifying securities must have at least 18 months to maturity at point of issuance, at least one month and less than five years remaining term to final maturity, a fixed coupon schedule and a minimum
amount outstanding of $1billion.
72
73
CITY OF NEWPORT BEACH
FINANCE COMMITTEE
STAFF REPORT
Agenda Item No. 5B
May 12, 2022
TO: HONORABLE CHAIRMAN AND MEMBERS OF THE COMMITTEE
FROM: Finance Department
Scott Catlett, Finance Director/ Treasurer
949-644-3123, scatlett@newportbeachca.gov
SUBJECT: THIRD QUARTER BUDGET UPDATE
SUMMARY:
The Finance Department prepares quarterly financial reports to review in detail the status
of revenues and expenditures for the City’s General Fund and to identify any concerning
budgetary trends in other City funds. This report contains information on revenues,
expenditures, and estimated fund balance for the third quarter of Fiscal Year 2021-22.
This third financial report of Fiscal Year 2021-22 provides an analysis of the financial
activity of the City from the months of July 2021 through March 2022. Based on
information available at the end of the third quarter, staff has made positive adjustments
to year-end projected revenues and preliminary expenditure savings have been identified
that should result in a healthy year-end budget surplus. Year-to-date expenditure budget
adjustments are fully offset by the additional projected revenues.
RECOMMENDED ACTION:
Review and discuss this report and provide any recommendations for consideration by
the City Manager and City Council.
DISCUSSION:
Economic Overview
Key economic indicators such as unemployment, taxable sales, and assessed property
values continue to improve, which is indicative of the recent robust improvement to the
economy. While recent trends in inflation have caused concern in the broader economy
and financial markets, the City is well-positioned to weather any short-term increase in
inflation thanks to the related increase in many of the City’s revenues such as sales tax
18
Third Quarter Budget Update
May 12, 2022
Page 2
and transient occupancy tax as prices increase and having long-term labor contracts in
place with most of the City’s employee associations.
The economy is expected to continue to grow through the remainder of the fiscal year.
However, it is likely that the hardest hit industries will continue to see the strongest
recovery as a return to normal consumer behavior spurs further growth in sales
associated with restaurants, hotels, and general consumer goods purchased in brick-and-
mortar establishments.
General Fund Revenues
Overall General Fund revenue growth has outpaced projections generated by the City’s
consultants and staff that were incorporated into the adopted Fiscal Year 2021-22 budget.
Growth in sales tax and transient occupancy tax has been the most pronounced, but
growth in many other areas has contributed to a significant projected increase in General
Fund revenues of $19.2 million versus the adopted budget. Of note, sales tax in the
categories hardest hit by the pandemic (brick-and-mortar businesses and restaurants &
hotels) has now surpassed the record high levels seen just prior to the pandemic’s onset,
and transient occupancy tax is now projected to exceed the pre-pandemic high by year-
end.
The following table summarizes the changes to projected General Fund revenues versus
the adopted budget for Fiscal Year 2021-22. Details follow highlighting the reasons for
the material variances.
Fiscal Year 2021-22 Projected General Fund Revenues
A B C = B-A D = C/A
Revenues by Category PY Actual
Adopted
Budget
Projected
Actual Variance % Variance
Property Taxes 119,157,540$ 122,229,980$ 123,449,469$ 1,219,489$ 1.0%
Sales Tax 38,956,275 40,275,670 45,392,567 5,116,897 12.7%
Transient Occupancy Tax 16,886,197 19,027,493 25,573,145 6,545,652 34.4%
Other Taxes 12,849,340 10,815,117 12,824,996 2,009,879 18.6%
Service Fees & Charges 18,264,952 19,046,329 20,010,449 964,120 5.1%
Parking Revenue 7,074,853 5,681,942 5,989,448 307,506 5.4%
Licenses and Permits 5,133,399 5,106,646 5,106,646 - 0.0%
Property Income 5,115,255 5,044,403 5,922,927 878,524 17.4%
Fines & Penalties 4,012,568 3,292,102 3,379,886 87,784 2.7%
Intergovernmental 5,175,738 1,760,934 3,574,265 1,813,331 103.0%
Investment Earnings 1,598,624 1,112,200 1,112,200 - 0.0%
Misc Revenues 1,359,034 734,148 1,034,151 300,003 40.9%
Total Revenues 235,583,776$ 234,126,964$ 253,370,149$ 19,243,185$ 8.1%
19
Third Quarter Budget Update
May 12, 2022
Page 3
Property Tax - Property taxes are the City’s single largest General Fund revenue and
represent approximately 50% of all General Fund revenues. As these revenues are
primarily dependent on the assessed valuation established in January of 2021, there is
typically very little variance seen from the original budget as the year progresses. The
growth rate for Fiscal Year 2021-22 was smaller than what has been seen in recent years,
primarily due to the lower 1.036% CPI factor. For Fiscal Year 2020-21, secured property
tax payments came in strong, $1.2 million over budget, which is an indication of timely
property tax payments and higher valuations. Based on the higher prior year revenues
and the most recent data shared by the City’s property tax consultant, staff has increased
the property tax revenue estimate for Fiscal Year 2021-22 by $1.2 million to $123.4
million.
Projections for Fiscal Year 2022-23 property tax revenues from the City’s property tax
consultant reflect a 6.5% increase in assessed values in the year ahead. This strong
growth is a result of the CPI factor returning to the maximum 2.0% allowed and adding
$1.2 billion to the assessed valuation, as well as continued strong property sales activity
and price appreciation adding $2.8 billion to the assessed valuation. The City’s total
assessed valuation for Fiscal Year 2022-23 is now projected to grow from $64.8 billion to
$69.0 billion.
Sales Tax - The second largest funding source for the General Fund is sales tax revenue,
making up more than 15% of General Fund revenues. The City’s sales tax base is largely
generated from three industry categories – autos and transportation, general consumer
goods, and restaurants/hotels. Most of these industries are also heavily impacted by
tourism.
Because sales tax revenues are remitted to the City by the State several months after
they are paid by consumers, information on which to report on for the third quarter reflects
actual receipts through the end of the December 2021. However, based on the strong
growth seen in recent quarters and the latest projections from the City’s sales tax
consultants, staff has increased the sales tax revenue estimate for Fiscal Year 2021-22
by $5.1 million to $45.4 million, an increase of 12.7%.
This increase results from two primary drivers. First, while auto sales have slowed due
to inventory shortages, price increases have more than offset this decline and have
resulted in strong growth in this category of sales tax revenues of 13.3% on a quarter
over prior year quarter basis in the October through December quarter. Second,
revenues from brick-and-mortar retail establishments and restaurants & hotels have now
surpassed the pre-pandemic high as consumer behavior has largely returned to normal.
These revenues grew at rates of 35.8% and 53.9%, respectively, versus the same prior
year quarter. Also factoring into the strong growth is revenue from fuel and service
stations, with 54.9% growth versus the same prior year quarter due to higher fuel prices
and higher demand. Overall revenue was up 19.6% versus the same prior year quarter,
leading to a year-end projection of 14.3% growth for the full fiscal year versus the prior
fiscal year.
20
Third Quarter Budget Update
May 12, 2022
Page 4
The outlook for sales tax revenues remains positive despite supply chain, pricing, and
labor concerns, and the City expects to see continued growth in the years ahead.
Transient Occupancy Tax – The City has seen a steady rebound and comeback for
TOT revenues as the effects of the pandemic receded. Initially, the TOT budget for the
current fiscal year was developed in anticipation of full recovery of TOT revenues not
occurring until the end of Fiscal Year 2022-23. However, staff’s revised projection in the
second quarter budget update estimated an increase in the budgeted revenues of $6.5
million to $25.6 million, an increase of 34.4%. Staff’s analysis has confirmed the projection
provided with the second quarter report and there is no further update to this projection
at this time.
Two factors are causing this significant increase in the projection. First, revenue from
short-term lodging businesses, which grew throughout the pandemic, is at a record high
level. Second, many hotel properties are reporting record high TOT receipts and have
been doing so for multiple consecutive months. While occupancy levels have not
returned to pre-pandemic levels, they are slowly increasing. This lag in occupancy levels
has been largely offset by higher daily room rates, resulting in hotel TOT revenues that
are projected to approach the pre-pandemic high this fiscal year. When taken together,
the strong growth in residential TOT makes up for the slightly lower hotel TOT projection
and the two in total are now projected to result in a record year for TOT revenues for the
City. The year-end projected revenues would exceed the prior year by 51.4% and the
Fiscal Year 2018-19 record by $876,000.
Data provided by Visit Newport Beach illustrates these very positive trends:
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Third Quarter Budget Update
May 12, 2022
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While the Marriot remains under renovation through the end of the month, it has now
reopened as VEA Newport Beach with expanded meeting space, higher room rates, and
a full complement of rooms available that have not been usable during the renovation
process this past year. Staff has conservatively not included an impact in the TOT
revenue projection from the changes to the hotel, which should result in a positive
variance beyond the current projection once the hotel is fully open. The Fashion Island
Hotel remains closed, but is expected to reopen in the Summer of 2023 following a sale
and renovation as the Pendry Newport Beach. Similarly, because the timing of the
Pendry’s opening is uncertain, staff has not included any revenue from the hotel in the
projection. These reopening’s, combined with the expected return of more business
travelers, are anticipated to have additional positive impact on the City’s TOT revenues.
The outlook for TOT revenues continues to exceed expectations, and the reopening of
the VEA and Pendry hotels with significant renovations and higher room rates presents
further opportunity for growth. Projections anticipate 8.7% growth in the fiscal year ahead
as the effects of the pandemic recede and trends return to more normal behavior.
All Other Revenue – This category includes all other revenue sources other than the top
three (property tax, sales tax, and TOT). All Other Revenue is made up of the following:
Other Taxes – real property transfer taxes, business license taxes, marine charter
taxes, and franchise fees.
Service Fees and Charges – plan check fees, recreation classes, emergency
medical services fees, and numerous other cost-of-service fees.
Parking Revenue – all General Fund related metered parking fees that are
assessed throughout the various parking zones of the City.
Licenses and Permits – fees charged to process building related permits, street
closure permits, dog licenses, and police tow franchise fees.
Property Income – City owned and managed income producing properties, long-
term ground leases to concessions, restaurants, hotels and other businesses and
22
Third Quarter Budget Update
May 12, 2022
Page 6
organizations, and rental of City facilities to the public.
Fines and Penalties – parking citation fines collected by the City, administrative
citation fines, fines remitted to the City from the County for vehicle code violations,
and false alarm penalties.
Intergovernmental Revenues – federal, state, and local grant revenues, which
includes, but is not limited to, the City’s portion of the ½ cent sales tax revenue
paid to the County for public safety, state mandate reimbursements,
reimbursement for strike teams sent to assist with fires, and revenue sharing with
the County of Orange under the Waste Disposal Agreement (WDA).
Investment Earnings – revenue generated from the investment of City funds.
Miscellaneous Revenues – restricted revenue, damage to City property, bad debt,
donations and contributions, non-operating revenues such as proceeds from the
sale of materials and equipment, and other miscellaneous revenues.
Growth in other revenues as a whole is projected to be $5.6 million above the adopted
budget or 10.7%. Primary drivers of this growth include:
Service fees and charges revenues are projected to exceed the adopted budget
by $1.0 million primarily due to increased revenue received from recreation fee-
based classes and the Junior Lifeguard program as discussed in more detail in the
prior quarter’s financial report.
Property income revenues are projected to exceed the adopted budget by $0.9
million, primarily due to increased percentage-based rent revenues from the Lido
House Hotel lease due to the hotel’s increased revenues.
Intergovernmental revenues are projected to exceed the adopted budget by $1.8
million, primarily due to adjustments related to Fire Department mutual aid
reimbursements and SB-2 Permanent Local Housing Allocation grant funds, as
discussed in the first quarter’s financial report in more detail.
Property transfer tax revenues are projected to exceed the adopted budget by $2.0
million due to the strong sales activity discussed earlier in this report.
Governmental accounting standards require the City to adjust the value of the City’s
investments to market value. Because the City normally holds investments to maturity
and receives the full value of securities regardless of market value fluctuations, these are
paper-only gains and losses that net to $0 over time. The impact of the gains and losses
associated with the change in the value of the City’s investments is recorded at year-end
as an addition to or subtraction from investment income. Because of the current volatile
and rising interest rate environment, staff anticipates a significant negative adjustment at
June 30, 2022, to reflect the fair value of the City’s investments. If staff recorded the entry
on April 30, 2022, a $2.9 million negative revenue would be recorded in the General Fund
to record the fair value adjustment. Staff does not yet know what the required adjustment
23
Third Quarter Budget Update
May 12, 2022
Page 7
will be as of June 30, 2022, which could be higher or lower than the April 30 amount.
Staff will advise the Committee in the fourth quarter report of the final amount of the
adjustment, but it seemed appropriate to mention it now as it will likely be material and
will reduce the projected surplus as reported later in this report.
General Fund Expenditures
The Fiscal Year 2021-22 General Fund revised expenditure budget totals $238.9 million.
The year-to-date spending trends in the current fiscal year are generally consistent with
prior years and do not indicate any cause for concern. Existing appropriations are on
target to fund all current operational expenditures and staff are currently projecting sizable
year-end budget savings comparable to what has been generated in prior fiscal years.
The table below summarizes the year-to-date changes to the adopted expenditure budget
for Fiscal Year 2021-22, as well as projected expenditure savings by budget category.
Details follow highlighting the reasons for the material variances. As promised in the
second quarter report, budget savings has been analyzed and revised based on new
information. Based on trends seen in prior years, additional budget savings are
anticipated to materialize as the fiscal year progresses.
Fiscal Year 2021-22 Projected General Fund Expenditures
Significant expenditure budget variances are as follows:
The revised salary and benefits budget totals $159.4 million, an increase of $7.7
million over the adopted budget. The increase is primarily due to the appropriation
of $5.0 million from Fiscal Year 2020-21 year-end budget surplus as an additional
discretionary payment to CalPERS to further reduce the City’s unfunded pension
A B C = A-B D = C/A
Expenditures by
Category
Adopted
Budget
Revised
Budget
Projected
Actual
Savings
(Overage)% Variance
Salary & Benefits 151,713,101$ 159,393,983$ 155,078,233$ 4,315,751$ 2.7%
Contract Services 24,702,901 27,262,619 26,026,031 1,236,587 4.5%
Grant Operating 600,000 926,490 926,490 - 0.0%
Utilities 3,011,315 3,219,168 3,806,096 (586,928) -18.2%
Supplies & Materials 3,739,730 4,425,598 4,345,944 79,654 1.8%
Maintenance & Repair 12,640,923 13,497,005 13,108,890 388,115 2.9%
Travel & Training 814,868 833,079 687,180 145,899 17.5%
General Expenses 2,130,552 2,303,168 2,332,914 (29,746) -1.3%
Internal Svc Charge 25,078,890 25,093,732 25,093,732 - 0.0%
Risk Management 750,915 750,915 750,915 - 0.0%
Capital Expenditures 780,438 1,145,810 1,145,810 - 0.0%
Total Expenditures 225,963,632$ 238,851,567$ 233,302,236$ 5,549,331$ 2.3%
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Third Quarter Budget Update
May 12, 2022
Page 8
liability. The remaining $2.7 million relates to recently approved contracts with the
majority of the City’s employee associations. The City does not budget for
unknown labor costs, which requires mid-year appropriations for negotiated salary
and benefit increases in the year in which new labor contracts are negotiated.
While the budget for the current year did include a $2.0 million vacancy factor,
additional salary and benefit savings beyond the vacancy factor of $4.3 million are
currently projected.
Increases to the contract services budget relate to a variety of routine mid-year
adjustments previously approved by the City Council, including $0.6 million added
to the contract instructors’ budget for Recreation and Senior Services that is fully
offset by higher revenues, $0.4 million for the Be Well OC program, $0.3 million
for the Medical IGT Program that is fully offset by higher revenues, and
appropriations offsetting several donations. Based on staff’s most recent budget
meetings with City Departments, contract services savings of $1.2 million are
currently projected.
Staff identified and reported on an issue with the City’s recent budgeting for
utilities. A portion of this issue was addressed with a budget amendment approved
by the City Council in the first quarter. However, additional overages are now
apparent. Staff is evaluating this issue and will be making adjustments in the Fiscal
Year 2022-23 budget to address it. As budget savings in other expenditure
categories are anticipated to fully offset the projected $0.6 million overage, staff is
not recommending a further adjustment to the utilities budget at this time.
Due to inflated prices for gasoline, the category titled General Expenses is
projected to go over budget by just under $30,000. As budget savings in other
categories offset this overage, staff is not recommending an adjustment to the fuel
budgets at this time.
Staff will also be including a budget amendment with this report when it is provided to the
City Council to obtain authorization for increasing revenues and expenditures related to
overtime associated with mutual aid to other organizations for fire strike teams.
On October 26, 2021, the City Council approved $31.0 million of recommended
appropriations from prior year unrestricted General Fund resources as follows:
1. CalPERS Unfunded Liability – $5.0 million to bring the City’s annual unfunded
liability contribution to CalPERS up from $35 million to $40 million, consistent with
recent years and the recommendation of the Finance Committee.
2. Facilities and Infrastructure Replacement Liabilities – $10.5 million toward
additional contributions to long-term infrastructure liabilities within the Facilities
Financial Plan and Harbor and Beaches CIP. Funds were set aside, with specific
allocations being recommended as part of the upcoming Fiscal Year 2022-23
budget process.
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Third Quarter Budget Update
May 12, 2022
Page 9
3. CIP and Neighborhood Enhancements – $15.5 million toward the Fiscal Year
2022-23 capital improvement program, to include neighborhood enhancement
projects. Funds were set aside with specific allocations being recommended as
part of the upcoming Fiscal Year 2022-23 budget process.
Other than the previously discussed appropriation toward the City’s CalPERS unfunded
liability, the remainder of these appropriations are reflected in the budget as transfers out
of the General Fund.
General Fund Sources, Uses, and Projected Surplus
As a result of the strong revenue growth seen year-to-date and projected continued strong
revenue growth through the end of the fiscal year, a budget surplus is anticipated based
on the additional revenues alone. Projected expenditure savings, which based on prior
year trends will likely exceed what is currently projected, will add to that surplus. While
this is all good news, the year is only 75% complete and staff remain cautious. Staff will
continue to revise these projections as the year progresses, with a final update to be
provided to the Finance Committee and City Council following the conclusion of the fiscal
year.
The table below illustrates the prior year sources and uses of funds as compared to the
adopted budget, the revised budget, and the projected year-end results:
Fiscal Year 2021-22 Projected General Sources, Uses, and Budget Surplus
As can be seen in the table above, even with the sizable appropriations earlier this year
that allocated three prior years’ budget surpluses, current projections now reflect a $17.9
A B C=B-A D=C/A
FY 2020-21 FY 2021-22 FY 2021-22 FY 2021-22 Variance % Variance
Actual Adopted Revised Projected
BEGINNING UNRESTRICTED FUND BALANCE 24,081,225$ 31,036,884$ 31,178,957$ 31,178,957$ 142,073$ 0.5%
SOURCES:
Operating Revenues 235,934,635 234,126,964 253,370,149 253,370,149 19,243,185 8.2%
Less: Restricted Revenues (957,206) (1,128,513) (1,128,513) (1,128,513) - 0.0%
Prior Year Resources Carried Forward 2,075,632 - 3,072,666 3,072,666 3,072,666 ---
Release of Restricted Funds 2,403,303 1,220,000 1,220,000 1,220,000 - 0.0%
Transfers In from Other Funds 21,526,628 11,977,157 11,977,157 10,492,133 (1,485,024) -12.4%
TOTAL SOURCES 260,982,992 246,195,608 268,511,459 267,026,435 20,830,827 8.5%
USES:
Operating Expenditures 220,647,754 225,963,632 238,851,567 233,302,236 7,338,604 3.2%
Transfers Out 27,467,575 20,200,000 47,030,300 47,030,300 26,830,300 132.8%
Resources Carried Forward to FY 2021-22 3,072,666 - - - - ---
Addition to 25% Contingency Reserve 2,697,265 - - - - ---
TOTAL USES 253,885,260 246,163,632 285,881,867 280,332,536 34,168,904 13.9%
ENDING UNRESTRICTED FUND BALANCE 31,178,957$ 31,068,860$ 13,808,549$ 17,872,856$ (13,196,004)$ -42.5%
CHANGE IN FUND BALANCE 7,097,732$ 31,976$ (17,370,408)$ (13,306,101)$ (13,338,077)$
Category
26
Third Quarter Budget Update
May 12, 2022
Page 10
million budget surplus for the current fiscal year. As discussed in prior quarterly reports,
it is quite possible that additional budget savings will be identified in the final quarter of
the year that may increase the surplus. However, it should again be noted that the City’s
financial situation can change based on economic forces outside of our control. Prudence
is therefore dictated until the year is complete and the actual budget surplus is calculated.
One item of note in the above table, is that the transfers in from other funds has decreased
by $1.5 million. This is due to an updated projection of the activity in the Tidelands
Operating Fund, which will require a higher subsidy from the General Fund than was
anticipated when the budget was developed. In January, staff brought a report to the
Committee to recommend changing the budget presentation format for the Tidelands
Operating Fund. That change has been incorporated into the FY 2022-23 Proposed
Budget, but the current year’s budget retains the old format reflecting the difference
between the cost allocation plan charges and the subsidy revenue to the Tidelands
Operating Fund as a net transfer into the General Fund. The primary reasons for the
projected $1.5 million reduction to the transfer in are that 1) the historical methodology
for calculating the subsidy when the budget was presented to the City Council did not
properly take into account planned capital expenditures from the Tidelands Operating
Fund or accurately project available fund balance and 2) the historical methodology
utilized in these quarterly reports did not include the impact of Tidelands Operating Fund
budget amendments in the current fiscal year that draw from unappropriated fund
balance, which must be backfilled by the General Fund. Staff has identified these issues
as part of the ongoing Fiscal Year 2022-23 budget process and has implemented
revisions to the budget process and the quarterly reporting process to properly account
for these variables in the Tidelands Operating Fund that indirectly impact the General
Fund through an increase in the subsidy required. While these variances were realized
at year-end in prior fiscal years, they will now be accounted for and recognized on a
timelier basis. The projection of the year-end surplus for the General Fund will therefore
be more accurate in the future as it relates to these Tidelands issues.
Lastly, as discussed in the revenues section of this report, the impact from adjusting the
value of the City’s investments to fair value is anticipated to negatively impact revenues
by a currently unknown amount. As of April 30, 2022, this amount is $2.9 million, so the
actual surplus is likely to be reduced to $15.0 million based on current information.
Other Funds
Staff have evaluated the fiscal condition of the City’s other major operating funds
(Tidelands, Water, and Wastewater). An analysis of the budget performance for the
Water and Wastewater funds through the third quarter of this fiscal year indicates that no
budget adjustments are necessary and variances between budgeted and actual amounts
are within reason.
An analysis of the Tidelands fund has demonstrated that a higher than budgeted subsidy
will be necessary to fund the current activity in the fund. There is no budgetary impact
due to the current presentation format of the Tidelands Fund, but this is reflected in the
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Third Quarter Budget Update
May 12, 2022
Page 11
General Fund sources and uses as a reduced transfer in as previously discussed.
Conclusion
As a result of conservative budgeting and sound financial policies, the City remains well
positioned to continue delivering a high level of service to the community while targeting
surplus resources to key priorities at year-end as has been the case for a number of
consecutive years. Staff recommends that the Finance Committee review and discuss
this report and provide any recommendations for City Manager and City Council
consideration prior to the May 24, 2022, City Council meeting, at which time this report
will be presented.
Prepared and Submitted by:
/s/ Shelby Burguan
____________________________
Shelby Burguan
Budget Manager
Tidelands Operating Fund Activity
FY 2021-22
Projected
Available Beginning Fund Balance 2,390,852
Projected Revenues 12,691,599
Total Sources 15,082,451
Operational Expenses (3,237,680)
Capital Improvement Projects (3,887,269)
Cost Allocation Plan (17,300,724)
Total Uses (24,425,672)
Deficit (Subsidy)(9,343,221)
Projected Net Increase to GF (CAP less Subsidy)7,957,503
Budgeted Net Increase to GF (CAP less Subsidy)9,442,529
Impact on General Fund (1,485,026)
28
05/12/2022
1
2021‐22
Third Quarter Financial Report
Finance
Committee
May 12, 2022
City of Newport Beach –Finance Department 2
Projected General Fund Revenues
Adopted Budget $ 234.1 million
First Quarter Projection $ 237.9 million
Second Quarter Projection $ 250.0 million
Third Quarter Projection $253.4 million
•$19.2 million of pr0jected positive variance
•Primary variances from adopted budget
•Property Tax + $1.2 million
•Sales Tax + $5.1 million
•Transient Occupancy Tax + $6.5 million
•Property Transfer Tax + $2.0 million
$‐
$50
$100
$150
$200
$250
$300
Adopted First
Quarter
Second
Quarter
Third
QuarterMillions
Property Tax Sales Tax TOT Other
1
2
05/12/2022
2
City of Newport Beach –Finance Department 3
Property Tax
•Represents approximately 50% of
General Fund revenues
•On track to exceed the adopted
budget based on strong assessed
value growth reflected in the final
tax roll
•Staff does not anticipate further
revisions to the projection for
secured property tax
•6.5% growth projected for FY
2022‐23, including the full 2.0%
allowable CPI factor
$97
$102
$108
$113
$119
$123
$90
$95
$100
$105
$110
$115
$120
$125
$130
2016‐17
Actual
2017‐18
Actual
2018‐19
Actual
2019‐20
Actual
2020‐21
Actual
2021‐22
ProjectedMillions+4.8%
+6.7%
+4.6%
+5.2%
+3.6%
City of Newport Beach –Finance Department 4
Sales Tax
•FY 2020‐21 was a record year for
sales tax revenues
•Growth is continuing, but
expected to moderate after this
fiscal year
•Auto sales remain strong, with
inventory declines offset by price
increases
•Restaurant/hotel and brick &
mortar retail receipts have now
exceeded pre‐pandemic levels
$34 $35
$39
$36
$39
$45
$30
$34
$38
$42
$46
2016‐17
Actual
2017‐18
Actual
2018‐19
Actual
2019‐20
Actual
2020‐21
Actual
2021‐22
ProjectedMillions+4.0%
+9.9%‐5.9%
+7.5%
+16.5%
3
4
05/12/2022
3
City of Newport Beach –Finance Department 5
Transient Occupancy Tax
•Revenue is now projected to exceed pre‐
pandemic levels this fiscal year
•Hotel TOT revenues are projected to
exceed pre‐pandemic levels next fiscal
year and residential TOT revenues are at
a record high level and growing
•Multiple hotel properties are reporting
record TOT collections with room rates
consistently higher than in prior years
•Projections do not account for any
impact from VEA Newport Beach
returning to full occupancy this month or
the opening of the Pendry (anticipated in
FY 2023‐24)
$22 $23
$25
$21
$17
$26
$14
$18
$22
$26
$30
2016‐17
Actual
2017‐18
Actual
2018‐19
Actual
2019‐20
Actual
2020‐21
Actual
2021‐22
ProjectedMillions+2.4%
+8.2%
‐15.6%
‐19.0%
+51.4%
City of Newport Beach –Finance Department 6
Transient Occupancy Tax Revenue Components
•Hotel‐related TOT revenues through the third quarter of the current fiscal year are still trailing 2019 by 8.6%
•However, excluding VEA and the Pendry hotel‐related TOT revenues are up 13.7% versus 2019
•Occupancy rates are still 25% below 2019 levels, but rates continue to climb ‐up 12% year‐to‐date
•Residential TOT is more than offsetting the lagging hotel TOT revenues, with an 86.4% rate of growth in the last three
fiscal years that has generated an additional $3.2 million versus FY 2018‐19 this fiscal year to date
$16.7 M
$8.3 M
$14.6 M$14.7 M
$17.5 M
$8.9 M
$18.8M$19.2 M
$‐
$5,000,000
$10,000,000
$15,000,000
$20,000,000
$25,000,000
FY 2021‐22FY 2020‐21FY 2019‐20FY 2018‐19
Hotel Only TOT Revenue Through
Third Quarter of Fiscal Year
No VEA or Pendry All Hotels
+ 13.7%
$‐
$2,000,000
$4,000,000
$6,000,000
$8,000,000
FY 2021‐22FY 2020‐21FY 2019‐20FY 2018‐19
Residential TOT Revenue Through
Third Quarter of Fiscal Year
STR Agents STR Owners
$3.7 M
$4.5 M
$6.9 M
$5.0 M
+ 86.4%
5
6
05/12/2022
4
City of Newport Beach –Finance Department 7
Historical General Fund Revenues
$235 $241 $251
$219
$200 $204
$217
$230 $230 $236
$253
$190
$200
$210
$220
$230
$240
$250
$260
2016‐17
Actual
2017‐18
Actual
2018‐19
Actual
2019‐20
Actual
2020‐21
Actual
2021‐22
ProjectedMillions
Pre‐COVID Projection Initial Post‐COVID Projection Actual and Current Projection
City of Newport Beach –Finance Department 8
Other General Fund Revenues
•Other revenues are projected to exceed the adopted budget by $6.4 million
or 12.1%
•Service fees and charges + $1.0 million primarily due to increased
revenues from recreation classes
•Property income + $0.9 million primarily due to increased percentage‐
based rent revenues
•Intergovernmental revenues + $1.8 million from mutual aid
reimbursements and SB‐2 Permanent Local Housing Allocation funds
•Property transfer tax + $2.0 million
7
8
05/12/2022
5
City of Newport Beach –Finance Department 9
Projected General Fund Expenditures
Adopted Budget $ 226.0 million
Revised Budget $ 238.8 million
Third Quarter Projection $ 233.3 million
•$5.0 million additional payment to CalPERS included in revised budget
•$3.1 million of budget carryovers
•Budget amendments for various purposes, most notably
•Implementation of new labor agreements
•Engineering costs for Balboa Island undergrounding district
•Budget savings of $5.5 million projected, which will likely increase
City of Newport Beach –Finance Department 10
General Fund Sources and Uses
•Increase in transfers out reflects
the use of prior year surplus for
FFP and CIP transfers
•Decrease in transfers in due to
comprehensive Tidelands
Operating Fund analysis
•Current projection of $17.9 million
surplus
•Budget savings will likely increase
later in the year
•Staff are monitoring inflation
trends, consumer spending, and
the financial markets for signs of
slowing economic growth
ABC=B‐AD=C/A
FY 2020-21 FY 2021-22 FY 2021-22 FY 2021-22 Variance % Variance
Actual Adopted Revised Projected
BEGINNING UNRESTRICTED FUND BALANCE 24,081,225$ 31,036,884$ 31,178,957$ 31,178,957$ 142,073$ 0.5%
SOURCES:
Operating Revenues 235,934,635 234,126,964 253,370,149 253,370,149 19,243,185 8.2%
Less: Restricted Revenues (957,206) (1,128,513) (1,128,513) (1,128,513) - 0.0%
Prior Year Resources Carried Forward 2,075,632 - 3,072,666 3,072,666 3,072,666 ---
Release of Restricted Funds 2,403,303 1,220,000 1,220,000 1,220,000 - 0.0%
Transfers In from Other Funds 21,526,628 11,977,157 11,977,157 10,492,133 (1,485,024) -12.4%
TOTAL SOURCES 260,982,992 246,195,608 268,511,459 267,026,435 20,830,827 8.5%
USES:
Operating Expenditures 220,647,754 225,963,632 238,851,567 233,302,236 7,338,604 3.2%
Transfers Out 27,467,575 20,200,000 47,030,300 47,030,300 26,830,300 132.8%
Resources Carried Forward to FY 2021-22 3,072,666 - - - - ---
Addition to 25% Contingency Reserve 2,697,265 - - - - ---
TOTAL USES 253,885,260 246,163,632 285,881,867 280,332,536 34,168,904 13.9%
ENDING UNRESTRICTED FUND BALANCE 31,178,957$ 31,068,860$ 13,808,549$ 17,872,856$ (13,196,004)$ -42.5%
CHANGE IN FUND BALANCE 7,097,732$ 31,976$ (17,370,408)$ (13,306,101)$ (13,338,077)$
Category
9
10
05/12/2022
6
City of Newport Beach –Finance Department 11
Other Major Funds
•Water and Wastewater funds are within budget, with
no adjustments required
•Tidelands Operating Fund will need a higher than
budgeted subsidy of $1.5 million
•Shown in the current budget presentation format
as a net transfer into the General Fund (cost
allocations to Tidelands, less subsidy)
•Additional subsidy necessary for two primary reasons:
1. Capital expenditures not properly accounted for
when the subsidy was initially calculated
2. Mid‐year budget adjustments that draw from
unappropriated Tidelands fund balance must be
backfilled by the General Fund
Tidelands Operating Fund Activity
FY 2021‐22
Projected
Available Beginning Fund Balance 2,390,852
Projected Revenues 12,691,599
Total Sources 15,082,451
Operational Expenses (3,237,680)
Capital Improvement Projects (3,887,269)
Cost Allocation Plan (17,300,724)
Total Uses (24,425,672)
Deficit (Subsidy) (9,343,221)
Projected Net Increase to GF (CAP less Subsidy) 7,957,503
Budgeted Net Increase to GF (CAP less Subsidy) 9,442,529
Impact on General Fund (1,485,026)
City of Newport Beach –Finance Department 12
Likely Year‐End Fair Value of Investments Adjustment
•Governmental accounting standards require the City to adjust the value of the City’s investments
to market value
•The City normally holds investments to maturity, so these are paper‐only gains and losses
•These adjustments happen every year, but they are normally not material and not
specifically discussed in year‐end reporting
•Due to current rising interest rates, staff anticipates a significant negative adjustment at year
end
•As of April 30, 2022, a $2.9 million adjustment would be required
•The fourth quarter report will incorporate a downward adjustment to General Fund revenue
equal to the final calculated amount
•This will reduce the otherwise available year‐end surplus
11
12
05/12/2022
7
City of Newport Beach –Finance Department 13
Recommended Action
Staff recommends that the Finance Committee:
•Review and discuss this report
•Provide any recommendations for consideration by the
City Manager and the City Council
City of Newport Beach –Finance Department 14
Questions?
13
14
ATTACHMENT A
PROPOSED BUDGET FISCAL YEAR 2022-23
AVAILABLE AT CITY HALL AND POSTED ON WEBSITE AT THE FOLLOWING LINK: http://www.newportbeachca.gov/budget
Proposed Budget Fiscal Year 2022-23
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05/12/2022
1
FY 2022-23 Proposed Budget
Additional Information
Finance
Committee
Meeting
May 12, 2022
City of Newport Beach – Finance Department 2
Revised General Fund Sources and Uses
• Updated with FY 2021-22 third quarter
starting fund balance projection
• As discussed during the prior presentation,
staff has revised the process for forecasting
fund balance for the Tidelands Fund
• Requires an additional $1.9 million transfer
to the Tidelands Fund for the projected FY
2022-23 subsidy
• The structural budget surplus has been
reduced by the same amount from $9.7
million to $7.8 million
• Because the current year surplus projection
has increased, the two-year total has
increased by $0.7 million to $22.2 million
FY 2022-23 FY 2022-23
Proposed Revised
BEGINNING UNRESTRICTED FUND BALANCE 11,794,742$ 14,421,264 2,626,522$
SOURCES:
Operating Revenues 265,030,502 265,030,502 -
Transfers In from Other Funds 18,550,724 18,550,724 -
TOTAL SOURCES 283,581,226 283,581,226 -
USES:
Operating Expenditures 244,186,089 244,186,089 -
Transfers Out 29,647,341 31,597,269 1,949,928
TOTAL USES 273,833,430 275,783,358 1,949,928
ENDING UNRESTRICTED FUND BALANCE 21,542,539 22,219,132 676,593$
CHANGE IN FUND BALANCE 9,747,797 7,797,868 (1,949,929)$
Category Change
1
2
05/12/2022
2
City of Newport Beach – Finance Department 3
Remaining Structural General Fund Surplus
• The budget as proposed reflects a $7.8 million structural surplus
• This amount is in addition to the projected FY 2021-22 unallocated surplus of $14.4 million
• Total available is expected to equal or exceed $22.2 million
• Several smaller employee bargaining groups have yet to conclude negotiations, which once
concluded will reduce this number by a total amount estimated to be well under $1.0 million
• The structural surplus could be utilized to address additional City Council priorities in a manner
comparable to the direction under City Council Policy F-5
• Staff recommends allocating the $7.8 million of structural surplus funds as follows:
• $5.0 million to prefund the typical year-end CalPERS UAL additional payment for FY 2021-22
• $1.0 million to establish an initial fund balance for the Recreation Facilities Financing Plan
• $1.8 million set aside for FY 2023-24 CIP
• Staff recommends allocating the full $14.4 million projected FY 2021-22 year-end surplus to FY 2023-24
CIP projects, and waiving the 50/50 requirement in City Council Policy F-5, as was done last fiscal year
City of Newport Beach – Finance Department 4
Request Finance Committee Action
• Endorse or modify staff’s recommended uses for the $22.2 million
of surplus funds for consideration by the City Council at its May 24th
meeting
3
4
CITY OF NEWPORT BEACH
FINANCE COMMITTEE
STAFF REPORT
Agenda Item No. 5D
May 12, 2022
TO: HONORABLE CHAIRMAN AND MEMBERS OF THE COMMITTEE
FROM: Finance Department
Scott Catlett, Finance Director/Treasurer
949-644-3123, scatlett@newportbeachca.gov
SUBJECT: INTERNAL AUDIT PROGRAM UPDATE
SUMMARY:
In the spirit of continuous improvement and with support and direction from the City
Manager’s Office, the Finance Department has been charged to develop a
comprehensive internal audit program. This report provides an update for internal audit
activities to date.
RECOMMENDED ACTION:
Receive and file.
DISCUSSION:
Background
In October 2019, Moss Adams was selected to assess internal controls, conduct
performance audits, and provide management consulting services where appropriate. In
September 2020, Moss Adams provided Enterprise Risk Assessment and Internal
Controls Review reports for the Committee’s review. From these reports, 13 internal audit
projects were identified, which are being addressed incrementally as part of each fiscal
year’s ongoing internal audit work plan.
In December 2021, the City issued RFP 22-27 - Internal Control Assessment and Test
work, Performance Audits, and Management Consulting Services. From the received
proposals, staff has selected four vendors to complete the remaining internal audit
projects identified by Moss Adams and additional audit projects identified by the Finance
Committee and/or staff in the future. Staff anticipate City Council approval of the award
of the contracts in the next 30 days.
30
Internal Audit Program Update
May 12, 2022
Page 2
Between January and February 2022, the first five internal audit project reports were
completed and presented to the Finance Committee. The reports were as follows:
1. Procurement Operational Review and Internal Control Testing
2. Policy Inventory and Implementation Plan
3. Inventory Management Internal Controls Testing
4. Information Technology
5. Cash, Billing, Collection, and Accounts Receivable
Current Progress
Staff has begun planning, meeting, coordinating, and working to implement key findings
from the five internal audit reports. Responding to the key findings requires different types
of work to be completed, including revisions to internal department procedures, intra-
department policy revisions, new policy development, and training coordination. This
work is underway, and staff will provide a brief verbal update to the Committee on
progress to date.
The remaining eight focus areas identified in the Moss Adams report will be reviewed in
the year ahead or in future years’ internal audit programs. The focus areas and the
anticipated fiscal year for their inclusion in the internal audit work plan are as follows:
1. Accounts Payable and Disbursement (Fiscal Year 2022-23)
2. Payroll (Fiscal Year 2022-23)
3. Fixed Asset Management (Fiscal Year 2022-23)
4. Police Property and Evidence Internal Controls Testing (Fiscal Year 2022-23)
5. Financial Reporting (TBD)
6. Budgeting (TBD)
7. Business Continuity and Disaster Planning Assessment (TBD)
8. Finance Customer Service Operational Review (TBD)
As discussed with the Finance Committee when the current fiscal year’s work plan was
approved, staff anticipates including other topics in future work plans as identified by staff
or the Committee as the topics listed in the original Moss Adams report are addressed.
Staff will return in three months with another update on activities for the five completed
reports, as well as an update on progress for the four focus areas to be studied in Fiscal
Year 2022-23.
Prepared and Submitted by:
/s/ Michael Gomez
_____________________________
Michael Gomez
Deputy Finance Director
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FY 2021‐22
Internal Audit Program Update
Finance
Committee
May 12, 2022
City of Newport Beach –Finance Department 2
Background
The City’s internal audit program was initiated in 2020
Goal to continuously review various areas of City operations with both
financial and operational reviews
Five topics were identified for review in FY 2020-21
No. Topic Progress Task Resource
1 Procurement Operational Review and Internal Controls Testing Complete MGO
2 Cash Handling Internal Controls Testing Complete Moss Adams
3 Information Technology Operational Review and Internal Controls Testing Complete Moss Adams
4 Fiscal Policy Inventory and Implementation Plan Complete Moss Adams
5 Inventory Management Internal Controls Testing Complete City Manager’s Office
1
2
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2
City of Newport Beach –Finance Department 3
Procurement Policies Review Status
Remaining Findings
Update procurement and contracting policies and procedures to be consistent with one another
Increase the purchasing thresholds
Updates
Staff have meet multiple times with a contract working group to review, and gather recommendations and revisions for the policy
The working group includes department end users of the purchasing and contracting process
The policy will include a review by Finance Management and the City Attorney’s Office
It is anticipated policy recommendation will be brought to the Finance Committee for consideration in September 2022
Purchasing thresholds reviews have not begun
Will be reviewed as part of procurement and contracting policy revisions
City of Newport Beach –Finance Department 4
Cash Handling Review Status
Remaining Findings
Establish citywide requirements for training all cash handlers
Develop citywide policies and require each site to develop specific supporting procedures
Develop minimum citywide policy that identifies the frequency cash is transferred to the Revenue
Division for deposit
Establish more effective controls and education on key controls over performing daily cash
reconciliations, and implement rotating cash audits at the Central Library
Updates
Staff have completed planning activities, including identifying required tasks to address the finding, information gathering from various sources, developing a timeline for task completion,
and communication to affected departments
Draft policies have been written
3
4
05/12/2022
3
City of Newport Beach –Finance Department 5
Information Technology Review Status
Remaining Findings
Review, update, and finalize the policies and procedures related to systems access, to ensure all
significant functions are addressed
Define the specific requirements for how role and permission changes must be requested,
approved, documented, and processed, and enforce compliance with those requirements
Formally document the process for handling terminated employee and contractor systems access removal to define related roles and responsibilities, documentation requirements, and controls to ensure removals of access are processed on or before the employee’s or contractor’s
departure
Updates
Staff is working collaboratively with HR to draft an administrative policy, prepared procedures, and develop a workflow
Staff is reviewing Contractor onboarding and offboarding procedures for consistency
City of Newport Beach –Finance Department 6
Inventory Management Review Status
Remaining Findings
Conduct a full inventory of auto parts and reconciliation against the inventory management
system, and purge unused or infrequently used parts
Updates
The inventory count and reconciliation is an ongoing process, and it is anticipated to be complete by the end of the current fiscal year
Old and/or unused items are being identified and will be disposed
5
6
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4
City of Newport Beach –Finance Department 7
Fiscal Policies Review Status
Remaining Findings
There are fourteen policies that will be reviewed and revised as part of the internal audit program
Updates
The highest priority policies are in the planning and drafting stages
It is anticipated that all policy revisions will be completed within twelve months
The drafting of the remaining entirely new policies is anticipated to be completed within twenty-four months
As part of this effort, staff will be evaluating all City Council F- policies for any required revisions,
as well as looking at whether any existing policies should be consolidated or split into multiple
policies
City of Newport Beach –Finance Department 8
Fiscal Policies Review Status
Policy New/Existing Planning Staff Drafting Policy
ManagementReview Complete
Inventory New X
Procurement Existing X X
Revenue and Accounts Receivable New X
Accounts Payable New X
Cash Management New X X
Debt Management Existing X
Fixed Asset Management Existing X
Grant Management Existing X
7
8
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5
City of Newport Beach –Finance Department 9
Questions?
9
5/5/22
Scheduled Date Agenda Title Report Type Agenda Description
Thursday, May 12, 2022 Third Quarter Budget Update Presentation Staff will provide a presentation regarding the year-to-date and projected Fiscal Year 2021-22 budget performance.
Follow-Up Discussion of Proposed FY 2022-23 Budget Discussion
Staff will provide the Committee with a copy of the Fiscal Year 2022-23
proposed budget document. Should the Committee wish to continue April's discussion of the Fiscal Year 2022-23 budget, this is also an opportunity to do so.
New Item Review of Investment Portfolio Strategy and Benchmark Presentation Staff will provide the Committee with an overview of the City's current investment strategy and several possible alternatives to determine if a change in strategy is appropriate at this time.
Internal Audit Program Update Presentation Bi-monthly progress update on the internal audit program.
Tuesday, May 24, 2022 Joint City Council and Finance Committee Study Session Presentation Staff will present the FY 2022-23 proposed budget to the City Council and
Finance Committee.
Thursday, May 26, 2022 Financial Statement Auditor's Communication with the Finance Committee acting
as the City's Audit Committee Presentation
The City's external auditors, Davis Farr LLP, will provide an overview
presentation regarding the audit process and request feedback from the
Committee regarding any information that may assist them in their audit of the
City's financial statements.
Committee Recommendation to Council for the FY 2022-23 Budget Discussion Discussion of the Study Session earlier in the week and formulation of any recommendations to be presented to the City Council at the budget public
hearing in June.
Newport Beach Finance Committee Work Plan
June 2022
May 2022
Committee Recess
August 2022
Committee Recess
Committee Recess
July 2022
I:\Users\FIN\Shared\Admin\Finance Committee\WORK PLAN\2022\WORK PLAN 2021-22 - 5-2-2022 1
32
5/5/22
Scheduled Date Agenda Title Report Type Agenda Description
Newport Beach Finance Committee Work Plan
Thursday, September 15, 2022 Annual Review of Investment Performance Presentation
The City's investment advisor, Chandler Asset Management, will report on the
performance of the City's investment portfolio for the fiscal year ending June 30, 2022.
Annual Review of Investment Policy Presentation
Staff will provide a presentation regarding any changes proposed to the City's
Investment Policy by staff or the City's investment advisor prior to the
Investment Policy being approved by the City Council.
Overview of Police Department Budget Presentation Staff will provide the Committee with a presentation covering the budget for the
Police Department.
Recommended Changes to Purchasing Policies Presentation Staff will provide on overview of recommended changes to the City's purchasing policies for the Committee's consideration, in follow-up to the Internal Audit Program report presented to the Committee in January.
Internal Audit Program Update Presentation Bi-monthly progress update on the internal audit program.
Budget Amendments for Quarter Ending June 30, 2022 Receive and File Staff will report on the budget amendments from the prior quarter.
Thursday, October 20, 2022 Year-End Budget Results Presentation Staff will provide a presentation regarding the year-end budget results for FY
2021-22.
Revenue Audit Program Update Presentation Staff will provide an update on audits conducted by the Revenue Division to verify transient occupancy tax (hotels, agents and residential owners), charter boat company, waste hauler, etc. revenue collections.
Budget Amendments for Quarter Ending September 30, 2022 Receive and File Staff will report on the budget amendments from the prior quarter.
Thursday, November 10, 2022 CalPERS Update Presentation Staff will provide the Committee with an overview of the data from the latest actuarial reports from CalPERS as well as their impact on prior projections of the paydown of the City's unfunded pension liability.
First Quarter Budget Update Presentation Staff will provide a presentation regarding the year-to-date and projected FY
2022-23 budget performance.
Long Range Financial Forecast (LRFF) Update Presentation Staff will brief the Committee regarding the results of the updated LRFF analysis.
Internal Audit Program Update Presentation Bi-monthly progress update on the internal audit program.
September 2022
November 2022
December 2022
Committee Recess
October 2022
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5/5/22
Scheduled Date Agenda Title Report Type Agenda Description
Newport Beach Finance Committee Work Plan
Thursday, January 12, 2023 Financial Statement Audit Results and Related Communication Presentation The City’s external auditors will meet with the Finance Committee to discuss the results of their audit for the fiscal year ending June 30, 2022.
Internal Audit Program Reports Presentation Presentation of reports, findings, and recommendations from the FY 2021-22
audit program.
Internal Audit Program Work Plan Review Presentation Selection of audit topics for the FY 2022-23 audit program.
Budget Amendments for Quarter Ending December 31, 2022 Receive and File Staff will report on the budget amendments from the prior quarter.
Thursday, February 16, 2023 Capital Improvement Program (CIP) Update Presentation Staff from Public Works will provide an update on what is planned for inclusion in the FY 2023-24 CIP.
Facilities Financial Plan (FFP) and Harbor & Beaches Master Plan Presentation
Staff will provide an update on the current status of FFP and Harbor & Beaches
Master Plan funding. Staff will also highlight changes to the development fee
funding projection methodology for the FFP.
Second Quarter Budget Update Presentation Staff will provide a presentation regarding the year-to-date and projected FY 2022-23 budget performance.
Thursday, March 16, 2023 Fiscal Year 2022-23 Fee Study Update Presentation Staff will present the Master Fee Schedule to the Finance Committee prior to presenting it to the City Council.
Overview of Revenue Projections Presentation Staff will provide the Committee with an overview of the assumptions utilized to prepare revenue projections for the City's major funds as part of the FY 2023-24 budget preparation process.
Internal Audit Program Update Presentation Bi-monthly progress update on the internal audit program.
Thursday, April 13, 2023 Proposed FY 2023-24 Budget Overview Presentation Staff will provide the Committee with an overview of the expenditure budget for FY 2023-24 that will be presented to the City Council in May.
OPEB Actuarial Valuation Report Update Presentation Staff will provide the Committee with an overview of the latest actuarial
valuation report prepared by the City's actuary.
Budget Amendments for Quarter Ending March 31, 2023 Receive and File Staff will report on the budget amendments from the prior quarter.
April 2023
February 2023
January 2023
March 2023
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05/12/2022
1
FY 2022-23 Proposed Budget
Additional Information
Finance
Committee
Meeting
May 12, 2022
City of Newport Beach – Finance Department 2
Revised General Fund Sources and Uses
• Updated with FY 2021-22 third quarter
starting fund balance projection
• As discussed during the prior presentation,
staff has revised the process for forecasting
fund balance for the Tidelands Fund
• Requires an additional $1.9 million transfer
to the Tidelands Fund for the projected FY
2022-23 subsidy
• The structural budget surplus has been
reduced by the same amount from $9.7
million to $7.8 million
• Because the current year surplus projection
has increased, the two-year total has
increased by $0.7 million to $22.2 million
FY 2022-23 FY 2022-23
Proposed Revised
BEGINNING UNRESTRICTED FUND BALANCE 11,794,742$ 14,421,264 2,626,522$
SOURCES:
Operating Revenues 265,030,502 265,030,502 -
Transfers In from Other Funds 18,550,724 18,550,724 -
TOTAL SOURCES 283,581,226 283,581,226 -
USES:
Operating Expenditures 244,186,089 244,186,089 -
Transfers Out 29,647,341 31,597,269 1,949,928
TOTAL USES 273,833,430 275,783,358 1,949,928
ENDING UNRESTRICTED FUND BALANCE 21,542,539 22,219,132 676,593$
CHANGE IN FUND BALANCE 9,747,797 7,797,868 (1,949,929)$
Category Change
1
2
05/12/2022
2
City of Newport Beach – Finance Department 3
Remaining Structural General Fund Surplus
• The budget as proposed reflects a $7.8 million structural surplus
• This amount is in addition to the projected FY 2021-22 unallocated surplus of $14.4 million
• Total available is expected to equal or exceed $22.2 million
• Several smaller employee bargaining groups have yet to conclude negotiations, which once
concluded will reduce this number by a total amount estimated to be well under $1.0 million
• The structural surplus could be utilized to address additional City Council priorities in a manner
comparable to the direction under City Council Policy F-5
• Staff recommends allocating the $7.8 million of structural surplus funds as follows:
• $5.0 million to prefund the typical year-end CalPERS UAL additional payment for FY 2021-22
• $1.0 million to establish an initial fund balance for the Recreation Facilities Financing Plan
• $1.8 million set aside for FY 2023-24 CIP
• Staff recommends allocating the full $14.4 million projected FY 2021-22 year-end surplus to FY 2023-24
CIP projects, and waiving the 50/50 requirement in City Council Policy F-5, as was done last fiscal year
City of Newport Beach – Finance Department 4
Request Finance Committee Action
• Endorse or modify staff’s recommended uses for the $22.2 million
of surplus funds for consideration by the City Council at its May 24th
meeting
3
4