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HomeMy WebLinkAbout01-28-08 Board of Finance Minutes,'~ .~. ~ ., Board of Finance City of South Bend, Indiana 2008 Meeting Minutes South Bend Common Council President Timothy A. Rouse called to order the January 28, 2008 Board of Finance at 3:00 p.m. in the Council Informal Meeting Room. Persons in attendance included: Council Members Dieter, Henry Davis, LaFountain, Puzzello, Varner, Rouse and White; Mayor Stephen Luecke, Interim City Controller John Murphy, City Clerk John Voorde, City Attorney Charles Leone, Tom Price, Ann Kolata, Don Inks, Elizabeth Leonard, Rita Kopola, Martha Lewis, Nancy Sulok of the South Bend Tribune, and Council Attorney Kathleen Cekanski-Farrand. Council President Rouse noted that the Board of Finance meeting was called pursuant to the Meeting Notice of January 24, 2008 (copy attached) governed by the state law requirements of Indiana Code § 5-13-7-1-, et seq. Election of Board of Finance Officers: Council President Rouse stated that the first item of business was the election of the Board of Finance offices for the positions of President and Secretary. Council Member Dieter made a motion, seconded by Council Member Puzzello that 3`d District Council Member Thomas LaFountain serve as the Board's President. There were no further motions for President. The motion passed. Council Member Dieter made a motion, seconded by Council Member White that 4~' District Council Member Ann Puzzello serve as the Board's Secretary. There were no further motions for President. The motion passed. Council President Rouse then turned the meeting over to Board President LaFountain. Review of the Annual Investment Report for Calendar Year 2007: Board President LaFountain then called for a review of the written report of the Investment Officer (City Controller) which summarizes the City of South Bend's investments during the 2007 calendar year and a review of the City of South Bend's overall investment policies. Interim City Controller John H. Murphy then distributed to the Board a 42-page document entitled "Boazd of Finance of the City of South Bend, Indiana Annual Investment Report for the Year Ended December 31, 2007" (copy attached). South Bend, Indiana Board of Finance Meeting Minutes January 28, 20098 Page 2 Mr. Murphy then highlighted selected pages of the report, noting in part that: • 2007 interest earnings were $6,954,739, an increase of $1,932,172 over 2006 interest earned • Reasons for the increase in 2007 interest included the inclusion of the Major Moves monies and the contract with ls` Source Bank guaranteeing a S.S% interest rate on the City's checking account • City of South bend seeks bids on its investments from ten (10) financial institutions • City of South bend will obtain Annual Reports for each of these ten (10) financial institutions as part of its due diligence review • For 2008, interest "will likely be reduced as interest rates have declined this past year. The current interest rate on a 60-day Certificate of Deposit is approximately 3.11%". In response to questions from Dr. Varner, Mr. Murphy noted that selection is based on the "best interest rate", and that the City budgets conservatively. Mr. Murphy stated that he would provide to the Board further information on the specific terms. He noted that Liz Rower developed the "Rate Quotation Sheet" set forth on page 5. In response to questions raised by Council Member White, Mr. Murphy noted that a verbal process is used where calls are made at 8 am with information to be provided by each financial institution by 11 am that same day. Calls are made 2-3 days before the maturity date. Mr. Murphy gave the example that he may take a $90 million amount and break it into two (2) amounts of $30 million and $60 million respectively so that smaller financial institutions may participate. He noted that the sweep account is the City's bank account. Mayor Luecke noted that this process takes place periodically throughout the year. Mr. Murphy then highlighted the City of South Bend's Investment Policy set forth on pages 29- 31. He noted in response to a question from the Council Attorney that he is not recommending any changes to this policy. The Council Attorney noted that the current Investment Policy has been in effect since 2005 when the Board of Finance approved that policy. In response to questions from Dr. Varner, Mr. Murphy noted that the city basically has one big bank account which is the "Depository Account", as well as a "Accounts Payable Account". Each are operated under business banking principals and bank account reconciliation. Every fund has to have money in the ledger account. In response to questions raised by Council President Rouse, Mr. Murphy highlighted interest earned and deposited as set forth on page 18 of the Annual Investment Report. South Bend, Indiana Board of Finance Meeting Minutes January 28, 20098 Page 3 In response to questions from Dr. Varner, Mr. Murphy noted that $700,000 has been budgeted in the General Fund for interest last year which was exceeded; and that $500,000 to $600,000 is projected for this year. Mr. Murphy also noted that if the property tax distribution had been made earlier, the City would have been able to earn more interest and save the costs incurred by the city for the tax anticipation warrants. Mr. Murphy noted that the savings account is with 1St Source Bank through January 31, 2009. Board President LaFountain thanked Mr. Murphy and the Mayor for the information presented. He requested an update to the Board on the first rate of re-investment which will soon be taking place. He noted that additional meetings of the Board of Finance may be called if necessary. There being no further business to come before the Board of Finance, Board President Thomas LaFountain mourned the n~~ing~at 3:23 p.m. [Hbf~iber Thomas LaFountain of Finance President Council Member Ann Puzzello Board of Finance Secretary Attachments Office of the City Clerk John ~oorde, City Clerk BOARD OF FINANCE OF THE CITY OF SOUTH BEND, INDIANA MEETING NOTICE TO: MEMBERS OF THE SOUTH BEND COMMON COUNCIL FROM: JOHN VOORDE, CITY CLERK DATE: JANUARY 24, 2008 RE: BOARD OF FINANCE MEETING The annual meeting of the Board of Finance of the City of South Bend, Indiana will take place in the Council Informal Meeting Room, 4~' Floor County-City Building, 227 W. Jefferson Blvd., South Bend, Indiana, 46601, on Monday January 28. 2008 at 3:00 p.m. This meeting is being called to do the following: Election of Board of Finance Officers for President and Secretary 2. Receive and review the written report from the Investment Officer (City Controller) Summarizing the City of South Bend's investments during the previous calendar year 3. Review the City's overall investment policies 4. Review miscellaneous financial information from the City Controller This meeting is governed by I.C. 5-13-7-7 et seq. cc: Mayor Stephen J. Luecke John Murphy, City Controller Charles S. Leone, City Attorney News Media 455 County-City Building •227 W. Jefferson Blvd •South Bend, Indiana 46601 •574/235-9221 •Fax 574/235-9173 • TDD 574/235-55G7 Mary Beth Wisniewslci JaniceTalboom Winona Hays Chief Deputy Deputy Ordinance Violation Clerk