1994 MIN DEC 6 - Laserfiche WebLink

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City of Colton and San Diego Gas & Electric for Capacity and Energy Transactions. Motion by Councilmember Sandoval, seconded by Councilmember Hutton, to approve Consent Calendar except for Items Nos. 4, 5, 6, 8, 9 and the Minutes of November 15, 1994. Unanimous vote. CITY TREASURER'S REPORT AND RECOMMENDATION: City Treasurer Williams submitted the Portfolio Master Summary he prepared for November 30, 1994, stating 86% of the City's portfolio is in the State pool, with current yield of 5.16%, which provides for daily liquidity, and 14% invested in treasury securities, with a value of $7,300,000. Treasurer Williams reviewed an investment summary showing March of 1994 as the highest for 1994, caused by a one-time revenue of half a million dollars which came through a redevelopment bond defeasance and a return of condemnation proceeds relating to TMI property. Councilmember Sanders inquired as to how the City was impacted by the drawdown of commodities, recurring operating losses - both in capital deficiencies, negative cash flows and operating activities. City Treasurer Williams responded there were several concerns: Continued drawdown on investment portfolio does not allow the City to earn money as if the investment held a steady balance or had increasing balances. Another issue is the "growing concern" opinion which impacted the City's credit rating and also some relationships with creditor and banking relationships. For instance, Bank of America has requested that payroll -direct deposit be paid three days in advance, starting with next payroll. Previously, the bank actually credited employee accounts a day before actually taking the money out of the City's account. We will now have to provide 100% of those monies. In response to Councilmember Sandoval's question as to high/low, cyclical balances, City Treasurer Williams stated that the high balances occur in January, April and May, when the County distributes property taxes. The trend, however, is downward. Councilmember Sandoval called attention to conflicting treasurer reports. City Treasurer Williams stated that for the first time in six years he has had to add to his certification statement the fact that "the investment portfolio herein does not provide sufficient cash flow to meet expected cash requirements." There is a question on the City's ability to operate as a going concern in the present format. The financial statement basically outlines a plan or lack of a plan to cure the deficit. The statement also expressed Mr. William's concern, as elected treasurer, of the City's current fiscal problems. Councilmember Sandoval asked if the City Treasurer agreed with the "growing concern" and on what basis. He indicated that in October N� 6 19%