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Home My WebLink About2025 Board of Finance Annual Investment ReportANNUAL INVESTMENT REPORT to the CITY OF SOUTH BEND BOARD OF FINANCE For the Year Ended December 31, 2025 Report Date: Report Distribution: Submitted By: January 26, 2026 South Bend Common Council Members Mayor Deputy Chief of Staff City Clerk Common Council Attorney Corporation Counsel State Board of Accounts (local office) City Controller (pursuant to I.C. 5-13-7-7) TABLE OF CONTENTS Investment Officers, Advisors, Authorized Investments .............................................................3 Investment Review Meetings .............................................................................................................4 Investment Report (12/31/25) ................................................................................................5 – 20 Year-End Cash Report (12/31/25 – preliminary) .............................................................. 21 – 23 Cash Management & Investment Policies ........................................................................... 24 – 32 INVESTMENT OFFICERS City Controller: Director of Treasury: Kyle J. Willis Rosa Tomas INVESTMENT ADVISORS (1ST SOURCE BANK) Paul W. Gifford, Jr., CFA Senior Vice President & Chief Investment Officer Erik Clapsaddle, CFA, CFP ® Vice President & Sr. Fixed Income Portfolio Manager Delia Salazar Nicholls Trust Officer AUTHORIZED INVESTMENT AMOUNT Portfolio of $200 million in investments with 1st Source Bank 3 INVESTMENT REVIEW MEETINGS QUARTER DATE TIME 1ST Quarter 10:00 A.M. 2ND Quarter 10:00 A.M. 3RD Quarter 10:00 A.M. 4TH Quarter 04/15/2026 07/15/2026 10/15/2026 01/15/2027 10:00 A.M. Investment Review Meetings will be held virtually via Microsoft Teams until further notice. 4 INVESTMENT REPORT (12/31/2025) 5 Investment Review for City of South Bend Corporate AgencyPrepared by Paul Gifford The Consumer & Manufacturing Data as of: January 6, 2026 Labor & Economic Growth Data as of: January 6, 2026 Source: Bureau of Labor Statistics •Real GDP grew at an annualized 4.3% in Q3 2025, supported by strong consumer spending, exports, and government outlays. For Q4 2025, the Atlanta Fed projects growth of 2.7% as of January 5, 2026, reflecting slower momentum amid weaker consumption and investment forecasts. •PCE totaled $21.1 trillion in Q3 2025, rising from Q2 and driven by robust services spending, including healthcare, housing, and recreation. For Q4 2025, real PCE was forecast to grow at an annualized 2.7% according to the Atlanta Fed, indicating continued but moderating consumer activity. •Federal government consumption and gross investment reached $1.99 trillion in Q3 2025, up from Q2, with national defense spending contributing notably to the increase. Federal spending growth was expected to moderate, consistent with broader forecasts showing cooling economic momentum toward year-end. •The largest drag on Q4 2025 GDP is projected to come from reduced personal consumption and private investment, as early forecasts showed declines in both categories following the government shutdown and weakening demand conditions. Interest Rates & Inflation Data as of: January 6, 2026 Account SummaryCity of South Bend Corporate Agency (619062011)As of December 31, 2025Asset AllocationTop Holdings % ofMarket ValueMkt ValCash$92,226,68945.7%Fixed Income$109,578,04154.3%Total$201,804,730100.0%UnrealizedAnnual% ofPriceTotal CostMarket ValueAccrualGain/LossIncomeMkt ValUnited States Treasury Bill Zero 16 Apr 202698.98213,798,946.5013,857,480.00.0058,533.50.006.9Federated Hermes Government Obligations Fund1.00013,369,471.1713,369,471.1776,369.33.00506,836.656.7United States Treasury Note/Bond 4.625% 30 Sep 202102.82810,178,064.7110,282,800.00118,166.20104,735.29462,500.005.1United States Treasury Note/Bond 4.375% 15 Dec 202100.78410,046,864.0810,078,400.0020,432.7031,535.92437,500.005.0United States Treasury Note/Bond 4.625% 28 Feb 202100.1309,998,828.1310,013,000.00157,147.8014,171.87462,500.005.0United States Treasury Note/Bond 2.375% 30 Apr 20299.6269,926,317.859,962,600.0040,676.8036,282.15237,500.005.0Wells Fargo Bank NA 4.25% 29 May 2026100.1919,500,000.009,518,145.00238,931.4618,145.00403,750.004.8Federal Home Loan Banks 4% 09 Oct 203099.9817,398,050.007,398,594.0067,422.21544.00296,000.003.7United States Treasury Note/Bond 4.25% 15 Mar 2027100.8487,015,468.747,059,360.0088,756.9243,891.26297,500.003.5United States Treasury Note/Bond 3.75% 15 Aug 2027100.4147,006,132.027,028,980.0099,150.8022,847.98262,500.003.5Bank of America NA 3.7% 22 Oct 2026100.0817,000,000.007,005,670.0050,380.825,670.00259,000.003.5All Others94,170,898.3294,501,893.36770,901.06330,995.043,409,819.2547.2Total199,409,041.52200,076,393.531,728,336.10667,352.017,035,405.90100.0 Activity SummaryCity of South Bend Corporate AgencyAs of December 31, 2025Annual Ending Market ValuesHistory of Asset GrowthMarket Value ReconciliationYearto Date(1 Year)1 Year2 Years3 Years5 YearsBeginning Portfolio Value202,036,541.85202,036,541.85198,874,676.88193,128,084.84185,909,481.55 Net Contributions/Withdrawals-9,105,261.56-9,105,261.56-15,999,147.69-19,421,776.24-7,112,592.52 Fees Deducted-181,711.72-181,711.72-361,670.85-536,972.33-887,709.13 Income Earned8,167,426.568,167,426.5615,232,384.5619,543,464.0522,971,475.11 Market Appreciation887,734.50887,734.504,058,486.739,091,929.31924,074.62Ending Portfolio Value201,804,729.63201,804,729.63201,804,729.63201,804,729.63201,804,729.63 Holdings DetailCity of South Bend Corporate Agency (619062011)As of December 31, 2025UnrealizedAnnualCurrent% ofUnitsTotal CostMarket ValueAccrualGain/LossIncome YieldMkt ValCash Money Market Federated Hermes Government 13,369,471.17013,369,471.1713,369,471.1776,369.33.00506,836.653.7916.7Obligations FundTotal: Money Market13,369,471.1713,369,471.1776,369.33.00506,836.653.7916.7 Treasury Bills United States Treasury Bill Zero 14,000,000.00013,798,946.5013,857,480.00.0058,533.50.00.0006.916 Apr 2026United States Treasury Bill Zero 7,000,000.0006,829,316.676,986,210.00.00156,893.33.00.0003.522 Jan 2026Total: Treasury Bills20,628,263.1720,843,690.00.00215,426.83.00.00010.4 Short Term and CDs American Commercial Bank & 250,000.000250,000.00253,640.00127.403,640.0011,625.004.583.1Trust National AssociatBMW Bank North America 5.15% 250,000.000250,000.00251,347.501,587.331,347.5012,875.005.122.118 May 202026Bank of America NA 3.7% 14 Jun 470,000.000471,006.51470,423.00952.88-583.5117,390.003.697.22027Bank of America NA 3.7% 22 Oct 7,000,000.0007,000,000.007,005,670.0050,380.825,670.00259,000.003.6973.52026Bank of America NA 4.45% 07 750,000.000750,000.00753,375.0013,441.443,375.0033,375.004.430.4Aug 2026Bank of America NA 4.6% 09 Feb 1,000,000.0001,000,000.001,000,840.0018,526.03840.0046,000.004.596.52026Bank of America NA 4.8% 06 Apr 2,000,000.0002,000,000.002,005,200.0023,408.225,200.0096,000.004.7881.02026Bank of America NA 4.85% 30 1,000,000.0001,000,000.001,002,500.0012,623.292,500.0048,500.004.838.5Mar 2026 Holdings DetailCity of South Bend Corporate Agency (619062011)As of December 31, 2025UnrealizedAnnualCurrent% ofUnitsTotal CostMarket ValueAccrualGain/LossIncome YieldMkt ValBank of America NA 5.05% 08 4,000,000.0004,000,000.004,023,840.0014,389.0423,840.00202,000.005.0202.0Jun 2026Bank of America NA 5.05% 22 3,000,000.0003,000,000.003,019,860.004,980.8119,860.00151,500.005.0171.5Jun 2026City National Bank Los Angeles 250,000.000250,000.00250,092.504,767.1292.5010,875.004.348.1California CertificFirst Merchants Bank/Muncie IN 4,000,000.0004,000,000.004,009,800.0069,643.849,800.00164,000.004.0902.04.1% 30 Jul 2026Flagstar Bank NA 4.6% 09 Feb 2,000,000.0002,000,000.002,001,680.0036,800.001,680.0092,000.004.5961.02026Goldman Sachs Bank USA/New 250,000.000250,000.00250,455.003,513.70455.009,500.003.793.1York NY 3.8% 19 Aug 202JPMorgan Chase Bank NA 3.8% 525,000.000526,044.75525,304.50491.92-740.2519,950.003.798.323 Mar 2027Medallion Bank/Salt Lake City UT 250,000.000250,000.00253,957.50357.883,957.5011,875.004.676.14.75% 21 Jun 2027Merrick Bank Corp/South Jordan 250,000.000249,500.00250,545.00364.381,045.009,500.003.792.1UT 3.8% 18 Aug 2027Morgan Stanley Bank NA 4.85% 250,000.000250,000.00253,702.503,089.383,702.5012,125.004.779.130 Mar 2027Morgan Stanley Private Bank NA 250,000.000250,000.00253,702.503,089.383,702.5012,125.004.779.14.85% 30 Mar 2027PNC Bank NA 4.05% 04 Mar 20265,000,000.0005,000,000.005,001,750.0066,020.551,750.00202,500.004.0492.5Sallie Mae Bank 3.75% 18 Dec 250,000.000250,000.00249,825.00385.28-175.009,375.003.753.12028TriState Capital Bank 5% 30 Mar 250,000.000250,000.00250,717.503,184.93717.5012,500.004.986.12026UBS Bank USA 4.35% 20 Jan 250,000.000250,000.00250,075.00387.3375.0010,875.004.349.12026United Fidelity Bank FSB 4.6% 29 2,000,000.0002,000,000.002,019,700.00756.1619,700.0092,000.004.5551.0Dec 2026 Holdings DetailCity of South Bend Corporate Agency (619062011)As of December 31, 2025UnrealizedAnnualCurrent% ofUnitsTotal CostMarket ValueAccrualGain/LossIncome YieldMkt ValUnited Fidelity Bank FSB 4.9% 30 500,000.000500,000.00507,810.00134.257,810.0024,500.004.825.3Mar 2027Valley National Bank/Wayne NJ 250,000.000250,000.00254,142.50394.524,142.5012,000.004.722.14.8% 21 Jun 2027Wells Fargo Bank NA 3.75% 27 4,000,000.0004,000,000.004,005,760.0013,972.605,760.00150,000.003.7452.0Nov 2026Wells Fargo Bank NA 4.25% 05 5,000,000.0005,000,000.005,036,850.0015,719.2036,850.00212,500.004.2192.5Mar 2027Wells Fargo Bank NA 4.25% 29 9,500,000.0009,500,000.009,518,145.00238,931.4618,145.00403,750.004.2424.8May 2026Wells Fargo Bank NA 4.3% 09 2,100,000.0002,100,000.002,102,163.0050,963.832,163.0090,300.004.2961.1Jun 2026Western Alliance Bank 3.8% 17 250,000.000250,000.00250,510.00390.41510.009,500.003.792.1Dec 2026Total: Short Term and CDs57,096,551.2657,283,383.00653,775.38186,831.742,450,015.004.27728.4 Total: Cash91,094,285.6091,496,544.17730,144.71402,258.572,956,851.653.23245.5 Fixed Income US Treasury & Agencies Federal Farm Credit Banks 1,000,000.0001,000,000.00987,930.00400.00-12,070.009,000.00.911.5Funding Corp .9% 15 JunFederal Farm Credit Banks 1,778,000.0001,786,285.481,785,236.4624,496.89-1,049.0271,120.003.984.9Funding Corp 4% 27 Aug 2Federal Home Loan Banks 1% 12 5,000,000.0005,000,000.004,920,050.0019,305.55-79,950.0050,000.001.0162.5Aug 2026Federal Home Loan Banks 3.81% 2,900,000.0002,900,000.002,903,277.0030,077.843,277.00110,490.003.8061.523 Sep 2030Federal Home Loan Banks 4% 03 4,000,000.0004,000,000.003,996,640.0048,444.44-3,360.00160,000.004.0032.0Sep 2027 Holdings DetailCity of South Bend Corporate Agency (619062011)As of December 31, 2025UnrealizedAnnualCurrent% ofUnitsTotal CostMarket ValueAccrualGain/LossIncome YieldMkt ValFederal Home Loan Banks 4% 09 7,400,000.0007,398,050.007,398,594.0067,422.21544.00296,000.004.0013.7Oct 2030Federal Home Loan Banks 2,000,000.0002,021,158.842,020,480.0025,437.50-678.8482,500.004.0831.04.125% 10 Sep 2027Federal Home Loan Banks 4.2% 5,000,000.0005,000,000.004,984,300.0065,333.35-15,700.00210,000.004.2132.509 Sep 2030Federal Home Loan Banks 3,000,000.0003,000,000.003,003,300.0038,927.073,300.00138,750.004.6201.54.625% 20 Mar 2030Federal Home Loan Banks 5% 20 500,000.000500,000.00501,345.007,013.891,345.0025,000.004.987.3Mar 2029Federal Home Loan Mortgage 310,000.000310,000.00309,897.70258.33-102.3011,625.003.751.2Corp 3.75% 23 Dec 2027Federal Home Loan Mortgage 5,000,000.0005,000,000.004,988,350.0011,250.00-11,650.00202,500.004.0592.5Corp 4.05% 11 Dec 2028Federal National Mortgage 4,000,000.0004,000,000.004,000,760.0036,444.44760.00160,000.003.9992.0Association 4% 09 Jul 20Federal National Mortgage 1,879,000.0001,879,000.001,878,624.2017,228.08-375.8076,569.254.076.9Association 4.075% 10 OcUnited States Treasury Note/Bond 6,000,000.0005,852,902.485,917,020.0050,991.8464,117.52135,000.002.2823.02.25% 15 Feb 2027United States Treasury Note/Bond 10,000,000.0009,926,317.859,962,600.0040,676.8036,282.15237,500.002.3845.02.375% 30 Apr 202United States Treasury Note/Bond 7,000,000.0007,006,132.027,028,980.0099,150.8022,847.98262,500.003.7353.53.75% 15 Aug 2027United States Treasury Note/Bond 4,500,000.0004,495,683.594,558,905.0030,828.7463,221.41180,000.003.9482.34% 31 Oct 2029United States Treasury Note/Bond 7,000,000.0007,015,468.747,059,360.0088,756.9243,891.26297,500.004.2143.54.25% 15 Mar 2027United States Treasury Note/Bond 10,000,000.00010,046,864.0810,078,400.0020,432.7031,535.92437,500.004.3415.04.375% 15 Dec 202United States Treasury Note/Bond 10,000,000.0009,998,828.1310,013,000.00157,147.8014,171.87462,500.004.6195.04.625% 28 Feb 202 Holdings DetailCity of South Bend Corporate Agency (619062011)As of December 31, 2025Unrealized Annual Current % ofUnits Total Cost Market Value Accrual Gain/Loss Income Yield Mkt ValUnited States Treasury Note/Bond 10,000,000.000 10,178,064.71 10,282,800.00 118,166.20 104,735.29 462,500.00 4.498 5.14.625% 30 Sep 202Total: US Treasury & Agencies108,314,755.92 108,579,849.36 998,191.39 265,093.44 4,078,554.25 3.756 54.4Total: Fixed Income108,314,755.92 108,579,849.36 998,191.39 265,093.44 4,078,554.25 3.756 54.4Total199,409,041.52 200,076,393.53 1,728,336.10 667,352.01 7,035,405.90 3.516 100.0 ACR Performance Summary Total NetCity of South Bend Corporate Agency (619062011)As of December 31, 2025Return DetailsYearto DateMarket Value (1 Year) 1 Year 3 Years 5 YearsTotal Fd Net Fee201,804,730 4.50 4.50 4.81 2.32Cash92,226,689 4.39 4.39 4.72 2.76Fixed Income109,578,041 4.74 4.74 4.86 2.36Total Managed201,804,730 4.59 4.59 4.91 2.41 Benchmark BOA Treasury 1-3 year5.09 5.09 4.48 1.79 12/31/2025 CASH REPORT 14 City of South Bend Report of Changes in Cash Balance January 1, 2025 through December 31, 2025 Ending Cash 1/1 Beginning 2025 YTD 2025 YTD Surplus Cash Balance Reserve Cash Balance Revenue Expenditures (Deficit)12/31/2025 Requirement Variance City Controlled Funds101 General Fund $91,331,532.92 $107,118,811.57 $117,797,411.11 ($10,678,599.54)$80,652,933.38 $58,898,705.56 21,754,227.83 Special Revenue Funds 102 Rainy Day 11,836,259.16 521,820.72 -521,820.72 12,358,079.88 $ 4,885,264.29 7,472,815.59 201 Parks & Recreation 11,969,237.01 24,340,381.64 30,339,710.94 (5,999,329.30)5,969,907.71 7,584,927.74 (1,615,020.03) 202 Motor Vehicle Highway 5,370,282.69 13,042,637.99 16,527,176.90 (3,484,538.91)1,885,743.78 4,131,794.23 (2,246,050.45) 209 Studebaker-Oliver Revitalizing Grants 639,405.61 27,411.74 101,948.10 (74,536.36)564,869.25 - 564,869.25 210 Economic Development State Grants (66,902.58)---(66,902.58)- (66,902.58) 211 Dept of Community Investment Operating 613,117.51 3,924,844.40 4,532,463.64 (607,619.24)5,498.27 - 5,498.27 212 Dept of Community Investment Grants 262,754.72 3,923,621.92 4,271,423.21 (347,801.29)(85,046.57)- (85,046.57) 216 Police State Seizures 306,471.24 102,418.39 -102,418.39 408,889.63 - 408,889.63 217 Gift, Donation, Bequest 2,825,418.16 197,188.39 823,486.08 (626,297.69)2,199,120.47 - 2,199,120.47 219 Unsafe Building 1,007,689.69 152,770.96 24,212.26 128,558.70 1,136,248.39 - 1,136,248.39 220 Law Enforcement Continuing Education 874,488.30 429,858.10 1,104,275.37 (674,417.27)200,071.03 276,068.84 (75,997.81) 221 Rental Units Regulation 397,457.93 208,379.13 6,564.65 201,814.48 599,272.41 - 599,272.41 227 Loss Recovery 3,123,867.72 481,837.31 -481,837.31 3,605,705.03 - 3,605,705.03 230 Code Enforcement 1,717.52 5,882,528.00 5,877,328.60 5,199.40 6,916.92 - 6,916.92 249 Local Income Tax - Public Safety 6,470,681.15 12,473,795.04 13,878,633.00 (1,404,837.96)5,065,843.19 - 5,065,843.19 251 Local Road & Street 478,515.43 2,263,080.25 2,091,102.99 171,977.26 650,492.69 522,775.75 127,716.94 257 LOIT Special Distribution 65,733.94 1,554.97 34,534.74 (32,979.77)32,754.17 - 32,754.17 258 Human Rights Federal Grants 310,825.45 181,110.48 301,738.81 (120,628.33)190,197.12 - 190,197.12 263 American Rescue Plan 980,781.88 42,520.52 23,274.10 19,246.42 1,000,028.30 - 1,000,028.30 264 COVID-19 Response -4,166.21 4,166.21 --- - 265 Local Road & Bridge Grant 338,404.76 2,257,203.87 2,595,523.93 (338,320.06)84.70 - 84.70 266 MVH Restricted 1,180,552.96 3,349,301.75 3,121,201.28 228,100.47 1,408,653.43 - 1,408,653.43 289 Haz-Mat 42,190.37 53,498.99 -53,498.99 95,689.36 - 95,689.36 291 Indiana River Rescue 567,227.50 146,663.84 54,921.64 91,742.20 658,969.70 13,730.41 645,239.29 295 COPS MORE Grant 20,876.46 ---20,876.46 20,876.46 299 Police Federal Drug Enforcement 294,113.71 40,875.19 32,043.35 8,831.84 302,945.55 8,010.84 294,934.71 404 Local Income Tax - Certified Shares 786,839.32 11,707.17 1,046,461.75 (1,034,754.58)(247,915.26)- (247,915.26) 408 Local Income Tax - Economic Development 30,701,333.37 18,540,126.03 24,119,813.04 (5,579,687.01)25,121,646.36 12,059,906.52 13,061,739.84 410 Urban Development Action Grant 71,914.18 3,170.44 -3,170.44 75,084.62 - 75,084.62 725 Morris / Palais Box Office 1,233,154.44 ---1,233,154.44 1,233,154.44 - 730 City Cemetery 32,783.58 1,445.31 -1,445.31 34,228.89 - 34,228.89 731 Bowman Cemetery 515,724.14 22,736.53 -22,736.53 538,460.67 400,000.00 138,460.67 754 Industrial Revolving Fund 4,853,400.05 97,738.32 151,895.57 (54,157.25)4,799,242.80 - 4,799,242.80 Total Special Revenue Funds $88,106,317.37 $92,726,393.60 $111,063,900.16 ($18,337,506.56)$69,768,810.81 $31,115,633.05 $38,653,177.76 Debt Service Funds 312 2017 Parks Bond Debt Service 169,828.70 1,166,784.26 1,181,215.00 (14,430.74)155,397.96 - 155,397.96 350 2018 Fire Station #9 Debt Service 0.72 344,656.26 344,656.28 (0.02)0.70 - 0.70 672 Century Center Energy Conservation Debt Service 152,073.92 374,112.43 388,753.52 (14,641.09)137,432.83 - 137,432.83 752 South Bend Redevelopment Authority 5,167,209.28 9,822,618.26 13,562,191.02 (3,739,572.76)1,427,636.52 1,427,636.52 - 755 South Bend Building Corporation 249,383.52 1,447,990.70 1,429,955.00 18,035.70 267,419.22 267,419.22 - 756 2015 Smart Streets Bond Debt Service Reserve 1,757,416.90 1,713,592.09 1,712,493.76 1,098.33 1,758,515.23 1,758,515.23 - 757 2015 Parks Bond Debt Service 594,294.91 348,025.82 381,031.26 (33,005.44)561,289.47 561,289.47 - 760 2017 Eddy Street Commons Bond Debt Service 3,669,174.05 1,955,312.88 1,955,125.00 187.88 3,669,361.93 2,500.00 3,666,861.93 Total Debt Service Funds $11,759,382.00 $17,173,092.70 $20,955,420.84 ($3,782,328.14)$7,977,053.86 $4,017,360.44 $3,959,693.42 Capital Funds 287 Fire Department Capital 2,843,653.42 2,647,125.83 5,193,983.50 (2,546,857.67)296,795.75 - 296,795.75 401 Coveleski Stadium Capital 210.23 835.45 -835.45 1,045.68 - 1,045.68 406 Cumulative Capital Development 364,286.11 768,424.45 500,000.00 268,424.45 632,710.56 - 632,710.56 407 Cumulative Capital Improvement 382,646.55 170,987.52 75,000.00 95,987.52 478,634.07 - 478,634.07 412 Major Moves Construction 925,625.59 157,160.28 482,898.69 (325,738.41)599,887.18 - 599,887.18 413 Professional Sports Convention Development Area 2,574,203.16 6,074,852.94 157,922.95 5,916,929.99 8,491,133.15 - 8,491,133.15 416 Morris Performing Arts Center Capital 6,037,555.69 123,593.91 6,692,657.62 (6,569,063.71)(531,508.02)- (531,508.02) 450 Palais Royale Historic Preservation 149,562.76 24,600.01 -24,600.01 174,162.77 - 174,162.77 451 2018 Fire Station #9 Bond Capital 342,923.25 15,118.35 -15,118.35 358,041.60 - 358,041.60 455 2021 Infrastructure Bond Capital 673,591.43 22,327.35 399,500.00 (377,172.65)296,418.78 - 296,418.78 458 2024 RDA Bond Proceeds (Four Winds)44,187,441.36 911,611.24 24,185,073.82 (23,273,462.58)20,913,978.78 - 20,913,978.78 471 2017 Parks Bond Capital 854,407.59 30,396.56 295,334.39 (264,937.83)589,469.76 - 589,469.76 759 2017 Eddy Street Commons Bond Capital 25,766.86 1.31 -1.31 25,768.17 - 25,768.17 Total Capital Funds $59,361,874.00 $10,947,035.20 $37,982,370.97 ($27,035,335.77)$32,326,538.23 -$32,326,538.23 City of South Bend Report of Changes in Cash Balance January 1, 2025 through December 31, 2025 Plus/ (Minus)Ending Cash 1/1 Beginning 2025 YTD 2025 YTD Accrual Surplus Cash Balance Reserve Cash Balance Revenue Expenditures Adjustments (Deficit)12/31/2025 Requirement Variance Enterprise Funds - 600 Consolidated Building 3,247,209.44 3,428,999.45 3,894,793.34 854.74 (465,793.89)2,781,415.55 973,698.34 1,807,717.22 601 Parking Garages 368,341.31 1,316,654.41 1,868,503.51 43,089.91 (551,849.10)(183,507.79)467,125.88 (650,633.67) 602 Morris Performing Arts Center Operations 126,112.62 2,006,154.57 1,744,316.74 (28,180.95)261,837.83 387,950.45 174,431.67 213,518.78 610 Solid Waste Operations 1,277,908.74 8,678,321.86 8,142,972.20 (47,378.04)535,349.66 1,813,258.40 814,297.22 998,961.18 611 Solid Waste Capital 2,043,183.20 1,227,319.20 3,270,240.22 -(2,042,921.02)262.18 - 262.18 620 Water Works Operations 12,675,922.77 22,933,676.39 18,586,829.33 77,951.81 4,346,847.06 17,022,769.83 929,341.47 16,093,428.36 622 Water Works Capital 15,820,437.90 8,413,341.13 8,010,510.33 65,578.98 402,830.80 16,223,268.70 - 16,223,268.70 624 Water Works Customer Deposit 1,401,816.94 61,752.72 -3,646.29 61,752.72 1,463,569.66 1,463,569.66 - 625 Water Works Sinking (Debt Service)2,039,158.28 168,623.63 541,857.66 (522,358.09)(373,234.03)1,665,924.25 - 1,665,924.25 626 Water Works Bond Reserve 1,613,195.01 211,934.31 --211,934.31 1,825,129.32 1,825,129.32 - 629 Water Works Operations & Maintenance Reserve 3,163,288.89 139,458.72 --139,458.72 3,302,747.61 3,098,424.45 204,323.16 640 Sewer Repair Insurance 1,580,380.89 774,353.17 1,083,679.59 3,148.61 (309,326.42)1,271,054.47 270,919.90 1,000,134.57 641 Sewage Works Operations 33,871,023.07 47,713,162.69 38,034,031.33 447,454.96 9,679,131.36 43,550,154.43 1,901,701.57 41,648,452.86 642 Sewage Works Capital 9,382,326.60 770,938.23 9,479,992.65 269,310.39 (8,709,054.42)673,272.18 - 673,272.18 643 Sewage Works Operations & Maintenance Reserve 5,996,959.49 264,385.71 --264,385.71 6,261,345.20 6,340,273.02 (78,927.82) 649 Sewage Sinking (Debt Service)12,888.16 8,065,505.38 8,078,144.10 -(12,638.72)249.44 - 249.44 653 Sewage Debt Service Reserve 4,534,268.50 573,155.96 --573,155.96 5,107,424.46 5,107,424.46 - 654 Sewage Works Customer Deposit 1,546,815.43 70,368.51 -131,168.47 70,368.51 1,617,183.94 1,617,183.94 - 655 Project Releaf 542,450.27 482,272.11 382,555.64 721.16 99,716.47 642,166.74 95,638.91 546,527.83 667 Storm Sewer 1,680,385.13 1,452,949.73 773,723.73 (11,445.15)679,226.00 2,359,611.13 - 2,359,611.13 670 Century Center 972,619.60 2,903,462.57 4,490,987.63 32,322.74 (1,587,525.06)(614,905.46)1,122,746.91 (1,737,652.37) 671 Century Center Capital 1,053,192.01 563,759.41 79,010.67 -484,748.74 1,537,940.75 800,000.00 737,940.75 Total Enterprise Funds $104,949,884.25 $112,220,549.86 $108,462,148.67 $465,885.83 $3,758,401.19 $108,708,285.44 $27,001,906.71 $81,706,378.73 Internal Service Funds222 Central Services 136,948.25 10,170,948.71 10,344,992.61 (136,887.24)(174,043.90)(37,095.65)- (37,095.65) 226 Liability Insurance 7,397,474.55 4,018,915.27 3,296,902.95 (4,359.05)722,012.32 8,119,486.87 1,648,451.48 6,471,035.40 278 Take Home Vehicle Police 941,096.68 117,565.93 --117,565.93 1,058,662.61 750,000.00 308,662.61 279 IT / Innovation / 311 Call Center 6,398,925.50 15,466,999.56 14,813,832.29 179,138.06 653,167.27 7,052,092.77 - 7,052,092.77 711 Self-Funded Employee Benefits 9,856,763.48 19,122,671.72 22,234,768.21 (7,784.10)(3,112,096.49)6,744,666.99 5,558,692.05 1,185,974.94 713 Unemployment Compensation 392.09 16,119.42 92,938.69 -(76,819.27)(76,427.18)23,234.67 (99,661.85) 714 Parental Leave 878,197.68 358,016.39 117,790.20 -240,226.19 1,118,423.87 9,423.22 1,109,000.65 Total Internal Service Funds $25,609,798.23 $49,271,237.00 $50,901,224.95 $30,107.67 ($1,629,987.95)$23,979,810.28 $7,989,801.42 $15,990,008.86 Fiduciary Funds 701 Fire Pension 342,385.46 3,940,695.73 4,251,624.08 -(310,928.35)31,457.11 425,162.41 (393,705.30) 702 Police Pension 537,964.30 6,085,028.97 6,092,335.78 -(7,306.81)530,657.49 609,233.58 (78,576.09) 709 Payroll Clearing (40,536.61)--(3,084,733.88)-(40,536.61)- (40,536.61) 718 State Tax Withholding Fund 338,475.32 --3,096,402.98 -338,475.32 338,475.32 - 726 Police Distributions Payable 824,098.89 --7,264.94 -824,098.89 824,098.89 - Total Fiduciary Funds $2,002,387.36 $10,025,724.70 $10,343,959.86 $18,934.04 ($318,235.16)$1,684,152.20 2,196,970.20 (512,818.00) Total City Controlled Funds $383,121,176.13 $399,482,844.63 $457,506,436.56 ($201,268,436.27)($58,023,591.93)$325,097,584.20 $131,220,377.36 $193,877,206.84 Redevelopment Commission Controlled Funds Tax Increment Financing Funds 324 TIF - River West Development Area 28,107,757.61 30,150,609.47 21,173,523.41 137,123.87 8,977,086.06 37,084,843.67 - - 422 TIF - West Washington 1,346,604.12 583,762.25 174,380.03 -409,382.22 1,755,986.34 - - 429 TIF - River East Development Area (NE Dev)21,696,391.94 9,111,070.20 7,622,272.81 (933,402.16)1,488,797.39 23,185,189.33 - - 430 TIF - Southside Development Area #1 8,620,393.44 3,802,188.49 3,010,997.61 (10,355.00)791,190.88 9,411,584.32 - - 435 TIF - Douglas Road 980,537.03 319,808.57 348,433.60 -(28,625.03)951,912.00 - - 436 TIF - River East Residential Area (NE Res)10,131,627.61 7,790,144.58 4,945,322.29 -2,844,822.29 12,976,449.90 - - Total Tax Increment Financing Funds $70,883,311.75 $51,757,583.56 $37,274,929.75 ($806,633.29)$14,482,653.81 $85,365,965.56 - - Redevelopment Funds 433 Redevelopment General 3,445,064.08 2,733,774.74 2,060,201.71 (11,700.76)673,573.03 4,118,637.11 515,050.43 3,603,586.68 439 Certified Technology Park 12,091.35 533.05 --533.05 12,624.40 - - 452 2018 TIF Park Bond Capital 172,745.66 5,180.40 76,675.85 -(71,495.45)101,250.21 - - 454 Airport Urban Enterprise Zone 445,232.38 19,628.76 --19,628.76 464,861.14 - - 456 2023 RDA Lease Rental Revenue Bond Series A 23,307,349.80 662,425.52 5,407,229.10 -(4,744,803.58)18,562,546.22 - - 457 2024 RDA Lease Rental Revenue Bond Series B 17,448,598.47 418,798.66 2,446,518.12 (14,570.00)(2,027,719.46)15,420,879.01 - - Total Redevelopment Funds $44,831,081.74 $3,840,341.13 $9,990,624.78 ($26,270.76)($6,150,283.65)$38,680,798.09 $515,050.43 $3,603,586.68 Debt Service Funds 315 Airport 2003 Debt Reserve 83,629.50 9,024.64 --9,024.64 92,654.14 92,654.14 - 328 SBCDA 2003 Debt Reserve 139,815.83 15,087.81 --15,087.81 154,903.64 154,903.64 - 351 2018 TIF Park Bond Debt Service Reserve 1,123,677.04 49,539.13 --49,539.13 1,173,216.17 1,173,216.17 - 352 2019 South Shore Double Tracking Debt Service 25,452.34 1,035,503.98 1,030,125.00 -5,378.98 30,831.32 - - 353 2020 TIF Library Bond Debt Service Reserve 326,968.84 16.34 --16.34 326,985.18 326,985.18 - Total Debt Service Funds $1,699,543.55 $1,109,171.90 $1,030,125.00 -$79,046.90 $1,778,590.45 $1,747,759.13 - Total Redevelopment Commission Funds $117,413,937.04 $56,707,096.59 $48,295,679.53 ($832,904.05)$8,411,417.06 $125,825,354.10 2,262,809.56 $3,603,586.68 Grand Total $500,535,113.17 $456,189,941.22 $505,802,116.09 ($202,101,340.32)($49,612,174.87)$450,922,938.30 $133,483,186.92 $197,480,793.52 CASH MANAGEMENT & INVESTMENT POLICIES 24 ADMINISTRATION & FINANCE POLICIES City of South Bend Cash Management and Investments Policy Section 1. Authority The City Controller (the “Controller”) of the City of South Bend, Indiana (the “City”) adopts this statement of policy (this “Policy”) pursuant to the Controller’s authority as the head of the Administration and Finance Department (the “Department”) under South Bend Municipal Code Section 2-21(b). Section 2. Background and Purposes The purpose of this Policy and the accompanying supplements is to set forth policies and procedures related to the City’s management of cash and investments. The City is permitted to invest funds in accordance with Indiana Code 5-13-9. Maintaining adequate access to liquid assets (cash and investments) is of paramount importance to the City. The City’s liquidity is a major component of its overall fiscal health. The ability to access adequate cash reserves when needed is important for maintaining service levels during periods of lowered tax revenue or for ensuring that non-discretionary expenses (such as debt service) are adequately funded. Additionally, maintaining strong cash reserves is one of the foundations of the City’s General Obligation Bond Rating, which is currently one of the highest in the state. In addition to the importance of maintaining strong liquidity, it is important that the City strive to increase its investment and interest income, within the confines of Indiana law and prudent financial management. Indiana law strictly limits the types of investments that the City is permitted to hold, which constrains income opportunity but also reduces risk of investment loss. This Policy will define the City’s investment philosophy and procedures designed to ensure compliance with all applicable laws and regulations. The City recognizes that cash management procedures (including receipt, deposit, and reconciliation) carry inherent risk that must be mitigated with appropriate internal control procedures. This Policy will outline these internal controls that must be followed to protect employees and ensure that the City remains a good steward of taxpayer dollars. The City’s financial system is Microsoft Dynamics 365 for Finance and Operations (“DFO”). DFO serves as the sole record of cash balances, cash receipts, and cash payments in the City. Any cash receipts that are initially recorded in a separate system must also be recorded in DFO. See the City of South Bend Revenue Recognition Policy for more information. Section 3. Roles and Responsibilities Controller The Controller is responsible for the overall cash management and investment strategy for the City. It is the Controller’s responsibility to define acceptable cash reserve requirements and enforce corrective actions (as prescribed in this Policy) when cash reserve requirements are not met. Additionally, it is the Controller’s responsibility to oversee the City’s investments, including hiring and providing oversight to outside investment management consultants. Finally, the Controller is responsible for designing cash management procedures (including cash receipt and reconciliation) that mitigate inherent risks of cash handling through strong internal control. In fulfilling the Controller’s responsibilities under this Policy, the Controller is assisted by the Deputy City Controller and may delegate all appropriate authority to the Deputy City Controller to achieve the purposes of this Policy. 25 Director of Treasury Under the direction of the Controller, the City’s Director of Treasury is responsible for the day-to-day management of the City’s cash and investment portfolio. This includes performing all bank reconciliations and resolving discrepancies, as well as serving as the point of contact for City employees, bank representatives, or investment management professionals on matters of cash handling, cash management, or investment management. The Director of Treasury is also responsible for ensuring that correct cash handling procedures are followed. Directors of Department Finance Directors of Department Finance are responsible for ensuring that cash receipts are correctly entered into DFO as they are received by various members of their assigned departments. Additionally, Directors of Department Finance work with the Director of Treasury to ensure that proper cash handling procedures are followed in each department and to identify cash receipts that are received by the Director of Treasury (especially those received via wire transfer or automated clearing house (ACH)). Section 4. Establishment of Procedures Except as otherwise provided, it is the Controller’s responsibility to establish, direct, modify, and otherwise maintain, from time to time as the Controller may determine in the Controller’s discretion, the procedures for carrying out the administrative and financial activities associated with the subject matter of this Policy. Due to the fundamental importance of maintaining strong cash reserves and the inherent risks associated with handling cash reserves, the Controller has established, both within and without DFO, certain rules and procedures for all divisions of the City to protect the City’s financial position and safeguard the City’s assets, including appropriate internal control measures in accordance with the City of South Bend Internal Control Policy and its supplemental materials. Those rules and procedures are included as supplements to this Policy and may be amended, supplemented, or eliminated from time to time as the Controller may deem appropriate, without the need for further approval of the Mayor or amendment to this Policy. Section 5. Effective Date and Approval This Policy is effective on May 1, 2021, and supersedes all prior policies addressing the same subject matter. 26 ADMINISTRATION & FINANCE POLICIES Supplement 202 – Investments The City shall invest excess cash in various investment vehicles as allowed by Indiana law. The City shall make all investments, in both Deposit and Investment Accounts, in accordance with the terms and limitations of Indiana Code 5-13-9. The current authorization for the City to engage in these investment activities comes from Ordinance No. 10993-23. The City's practice is to obtain authorization via an ordinance on an annual basis, so as to maintain the maximum investment flexibility under Indiana Code 5-13-9. Board of Finance The local Board of Finance (as defined in Indiana Code 5-13-7) will review the investment policy and will receive an investment report on an annual basis coincident with the Annual Meeting of the Board of Finance, held after the 1st Monday in January and before January 31st. Valuation of Investments Currently, the total amount invested is $200 million. On a monthly basis, the City’s investment custodian (currently 1st Source) transfers any gain in market value over $200 million or direct dividends paid from investments into the City’s depository bank account. This investment income is allocated using the procedures described in Supplement 203. The City will not track the current fair market value of investments on a monthly basis in DFO. Rather, the City's books will be adjusted for FMV of investments on an annual basis only. 27 ADMINISTRATION & FINANCE POLICIES Supplement 208 - Cash Reserve Requirements The City of South Bend has established the following cash reserve guidelines to ensure adequate liquidity. Cash reserves are defined as cash balances on hand less outstanding encumbrances. “Annual expenditures” in each fund do not include capital expenditures. Fund Fund Name Cash Reserve Policy 101 General Fund 50% of annual expenditures 102 Rainy Day 3% of prior year operational expenditures in Civil City funds, excluding interfund transfers 201 Parks & Recreation 25% of annual expenditures 202 Motor Vehicle Highway 25% of annual expenditures 209 Studebaker/Oliver Reverting Grants No reserve requirement - Grant fund - spend down to zero 210 Department of Community Investment State Grants No reserve requirement - Grant fund - spend down to zero 211 Department of Community Investment Operating No reserve requirement 212 Department of Community Investment Grants No reserve requirement - Grant fund - spend down to zero 216 Police State Seizures 25% of annual expenditures 217 Gift, Donation, Bequest No reserve requirement 219 Unsafe Building No reserve requirement 220 Law Enforcement Continuing Education 25% of annual expenditures 221 Rental Units Regulation No reserve requirement 222 Central Services No reserve requirement 226 Liability Insurance 50% of annual expenditures 227 Loss Recovery No reserve requirement 230 Code Enforcement No reserve requirement 249 Local Income Tax - Public Safety No reserve requirement 28 Fund Fund Name Cash Reserve Policy 251 Local Road & Street 25% of annual expenditures 257 LOIT 2016 Special Distribution No reserve requirement 258 Human Rights Federal Grants No reserve requirement - Grant fund - spend down to zero 263 American Rescue Plan No reserve requirement - Grant fund - spend down to zero 264 COVID-19 Response No reserve requirement 265 Local Road & Bridge Matching Grant No reserve requirement - Grant fund - spend down to zero 266 MVH Restricted No reserve requirement 278 Police Take Home Vehicle $750,000 minimum 279 IT / Innovation / 311 Call Center No reserve requirement 287 Fire Department Capital No reserve requirement - Capital fund - spend down to zero 289 Haz-Mat 25% of annual expenditures 291 Indiana River Rescue 25% of annual expenditures 299 Police Federal Drug Enforcement 25% of annual expenditures 312 2017 Parks Bond Debt Service No reserve requirement 315 Airport 2003 Debt Reserve 100% of debt service reserve per bond covenants 324 TIF - River West Development Area No reserve requirement 328 SBCDA 2003 Debt Reserve 100% debt service reserve per bond covenants 350 2018 Fire Station #9 Bond Debt Service No reserve requirement 351 2018 TIF Parks Bond Debt Service 100% debt service reserve per bond covenants 352 2019 South Shore Double Tracking Debt Service No reserve requirement 353 2020 TIF Library Bond Debt Service Reserve 100% debt service reserve per bond covenants 401 Coveleski Stadium Capital No reserve requirement - Capital fund - spend down to zero 29 Fund Fund Name Cash Reserve Policy 404 Local Income Tax - Certified Shares 50% of annual expenditures 406 Cumulative Capital Development No reserve requirement - Capital fund - spend down to zero 407 Cumulative Capital Improvement No reserve requirement - Capital fund - spend down to zero 408 Local Income Tax - Economic Development 50% of annual expenditures 410 Urban Development Action Grant (UDAG) No reserve requirement - Grant fund - spend down to zero 412 Major Moves Construction No reserve requirement - Capital fund - spend down to zero 413 Professional Sports Convention Development Area (PSCDA) No reserve requirement - Capital fund - spend down to zero 416 Morris Performing Arts Center Capital No reserve requirement - Capital fund - spend down to zero 422 TIF - West Washington No reserve requirement 429 TIF - River East Development Area (NE Dev) No reserve requirement 430 TIF - Southside Development Area #1 No reserve requirement 433 Redevelopment General 25% of annual expenditures 435 TIF - Douglas Road No reserve requirement 436 TIF - River East Residential (NE Res) No reserve requirement 439 Certified Technology Park No reserve requirement 450 Palais Royale Historic Preservation No reserve requirement 451 2018 Fire Station #9 Bond Capital No reserve requirement - Bond capital fund - spend down to zero 452 2018 TIF Parks Bond Capital No reserve requirement - Bond capital fund - spend down to zero 453 Zoo Bond Capital No reserve requirement - Bond capital fund - spend down to zero 454 Airport Urban Enterprise Zone No reserve requirement 455 2021 Infrastructure Bond Capital No reserve requirement - Bond capital fund - spend down to zero 30 Fund Fund Name Cash Reserve Policy 456 2023 RDA Bond Series A (Neighborhood Infrastructure) No reserve requirement - Bond capital fund - spend down to zero 457 2024 RDA Bond Series B (Madison Lifestyle) No reserve requirement - Bond capital fund - spend down to zero 458 2024 RDA Bond Series A (Four Winds Field Project) No reserve requirement - Bond capital fund - spend down to zero 471 2017 Parks Bond Capital No reserve requirement - Bond capital fund - spend down to zero 600 Consolidated Building Department 25% of annual expenditures 601 Parking Garages 25% of annual expenditures 602 Morris Performing Arts Center Operations 10% of annual expenditures 610 Solid Waste Operations 10% of annual expenditures 611 Solid Waste Capital No reserve requirement - Capital fund - spend down to zero 620 Water Works Operations 5% of annual expenditures 622 Water Works Capital No reserve requirement - Capital fund - spend down to zero 624 Water Works Customer Deposit 100% cash reserves for customer deposits 625 Water Works Sinking (Debt Service) No reserve requirement 626 Water Works Bond Reserve 100% cash reserves per bond covenants 629 Water Works Operations & Maintenance Reserve 16.67% of annual operating expenses in fund 620, net of transfers 640 Sewer Repair Insurance 25% of annual expenditures 641 Sewage Works Operations 5% of annual expenditures 642 Sewage Works Capital No reserve requirement - Capital fund - spend down to zero 643 Sewage Works Operations & Maintenance Reserve 16.67% of annual operating expenses in fund 641, net of transfers 649 Sewage Works Sinking (Debt Service) No reserve requirement 653 Sewage Works Debt Service Reserve 100% cash reserves per bond covenants 654 Sewage Works Customer Deposit 100% cash reserves for customer deposits Fund Fund Name Cash Reserve Policy 655 Project ReLeaf (Leaf Pickup and Removal) 25% of annual expenditures 667 Storm Sewer No reserve requirement - Capital fund - spend down to zero 670 Century Center Operations 25% of annual expenditures 671 Century Center Capital $800,000 minimum 672 Century Center Energy Conservation Bond No reserve requirement 701 Firefighters Pension 10% of annual expenditures 702 Police Pension 10% of annual expenditures 709 Payroll Clearing No reserve requirement – clearing fund 711 Self-Funded Employee Benefits 25% of annual expenditures 713 Unemployment Compensation 25% of annual expenditures 714 Parental Leave 8% of annual expenditures – 1 month of expenditures 718 State Tax Withholding Fund 100% cash reserves 725 Morris / Palais Box Office 100% cash reserves 726 Police Distributions Payable 100% cash reserves 730 City Cemetery 25% of annual expenditures 731 Bowman Cemetery $400,000 minimum 750 Equipment/Vehicle Leasing No reserve requirement - Capital lease fund - spend down to zero 752 South Bend Redevelopment Authority 100% cash reserves per bond covenants 754 Industrial Revolving Fund No City reserve requirement; there are program requirements 755 South Bend Building Corporation 100% cash reserves per bond covenants 756 2015 Smart Streets Bond Debt Service 100% cash reserves per bond covenants 757 2015 Parks Bond Debt Service 100% cash reserves per bond covenants 759 2017 Eddy Street Commons Bond Capital No reserve requirement - Bond capital fund - spend down to zero Fund Fund Name Cash Reserve Policy 760 2017 Eddy Street Commons Bond Debt Service $2,500,000 minimum per bond covenant 32