Loading...
HomeMy WebLinkAbout05 QUARTERLY INVESTMENT REPORTDocuSign Envelope ID: 1B402188-3A73-46F1-87CC-E2B36D2F262E 5� Agenda Item Reviewed: Ds AGENDAREPORT City Manager Finance Director MEETING DATE: JUNE 6, 2023 TO: MATTHEW S. WEST, CITY MANAGER FROM: JENNIFER KING, FINANCE DIRECTOR/CITY TREASURER SUBJECT: QUARTERLY INVESTMENT REPORT FOR THE CITY OF TUSTIN AND THE SUCCESSOR AGENCY FOR THE TUSTIN COMMUNITY REDEVELOPMENT AGENCY FOR THE QUARTER ENDING MARCH 31, 2023 SUMMARY: Government Code Section 53646 requires that the Treasurer make an Investment Report to the City Council at least quarterly showing balances by authorized investment and certifying its compliance with the adopted Investment Policy. RECOMMENDATION: Receive and file. CORRELATION TO THE STRATEGIC PLAN: Correlates with the City's Strategic Plan Goal C: Financial Strength, Item 3. This investment report provides evidence of the City's commitment to ensure that investments are in compliance with the adopted investment policy. DISCUSSION: In compliance with Government Code Section 53646, the attached Investment Report for the City of Tustin and the Successor Agency for the Tustin Community Redevelopment Agency for the quarter ending March 31, 2023 is rendered. The City's total cash and investments amounted to approximately $201 million as of March 31, 2023. The weighted average portfolio yield for the investment portfolio was 3.49%, which is 63 basis points higher than the weighted average portfolio yield for the prior quarter. The primary reason for the increase in the weighted average portfolio yield is due to continuing upward movement in shorter - term Treasury yields. After seven rate hikes in 2022, the Federal Open Market Committee (FOMC) raised the federal funds rate by another 0.25% in March 2023 with a continued focus to bring down inflation to their 2% target. At the same time, FOMC also acknowledged the tightening of financial conditions and decelerating growth. As a result, the 2-year Treasury yield decreased to 4.03% by March 2023, compared to a yield of 4.43% in December 2022. The 5-year Treasury yield decreased to 3.58% by March 2023, compared to a yield of 4.01 % in December 2022. DocuSign Envelope ID: 1B402188-3A73-46F1-87CC-E2B36D2F262E Quarterly Investment Report for the Period Ending March 31, 2023 Page 2 of 2 PARS Pension Trust Since 2018, the City has made contributions totaling $9.6 million into a Pension Trust, which is held by Public Agency Retirement Services (PARS). A Pension Trust provides rate stabilization since Pension Trust assets can be used to offset unanticipated increases in CalPERS pension costs. Pension Trust assets are managed in a customized investment strategy that balances risks and return and provides for diversification. Pension Trust Fund assets amounted to $10.7 million at March 31, 2023. The three-year annualized return for the PARS Pension Trust Fund was 7.19%. PARS OPEB Trust The City has also made $3 million in contributions into an Other Post -Employment Benefits (OPEB) Trust, including a contribution of $500,000 in March 2023. The OPEB Trust is held by PARS and includes funds that are set -aside for future retiree healthcare costs. Trust assets are managed in a customized investment strategy that balances risk and return and provides for diversification. OPEB Trust Fund assets amounted to $3.3 million at March 31, 2023. The three-year annualized return for the PARS OPEB Trust Fund was 7.19%. Investment Compliance Certification On April 27, 2023, the Audit Commission verified that the investment portfolio is in compliance with the City's Investment Policy and the California Government Code. In addition, the Treasurer's cash management program and cash flow analysis indicates that sufficient liquidity is on hand to meet estimated operating expenditures for the next twelve (12) months and the projected cash flow needs for the completion of various capital projects, which include, but not limited to traffic and street improvements, water system improvements, park projects, improvements to public facilities and capital projects at the Tustin Legacy. I,L� - Jennifer King Finance Director/City Treasurer Attachments: Investment Report Certification Quarterly Investment Report for the Period Ending March 31, 2023 Restricted Deposits with Fiscal Agents as of March 31, 2023 PARS Trust Statements as of March 31, 2023 DocuSign Envelope ID: 1B402188-3A73-46F1-87CC-E2B36D2F262E FINANCE DEPARTMENT Remembering what connects us. April 27, 2023 Honorable Mayor and Members of the City Council: Re: Investment Report Certification In compliance with California Government Code Section 53646, the attached Investment Report for the Quarter Ending March 31, 2023 is hereby rendered for the City of Tustin and Successor Agency for the Tustin Community Redevelopment Agency (Successor Agency). We certify that this report reflects all City of Tustin and Successor Agency pooled cash and investments subject to the provisions of California Government Code and the City's Investment Policy. It has been verified that the investment portfolio is in compliance with the City's Investment Policy. In addition, the Treasurer's cash management program and cash flow analysis indicates that sufficient liquidity is on hand to meet estimated future expenditures for the next twelve (12) months. Respectfully submitted, Jered Elmore, Chair City of Tustin Audit Commission Jennifer King, Finance Director City of Tustin 300 Centennial Way, Tustin, CA 92780 • 714-573-3060 9 tustinca.org DocuSign Envelope ID: 1B402188-3A73-46F1-87CC-E2B36D2F262E IINVESTMENT REPORT City of Tustin Period Ending March 31, 2023 CHANDLER ASSET MANAGEMENT, INC. 1 800.317.4747 C'CHANDLER ASSET MANAGEMENT www.chandlerasset.com i J DocuSign Envelope ID: 1B402188-3A73-46F1-87CC-E2B36D2F262E Table of Contents SECTION 1 Economic Update SECTION 2 Account Profile SECTION 3 Portfolio Holdings SECTION 4 Transactions As of March 31, 2023 1 Q11 ,CDocuSign Envelope ID: 1B402188-3A73-46F1-87CC-E2B36D2F262E T Section 1 1 Economic Update K40 DocuSign Envelope ID: 1B402188-3A73-46F1-87CC-E2B36D2F262E I Economic Update ■ Economic trends have been decelerating along with tighter fin anciaIcon ditions and restrictive monetary policy. Recent data suggests positive but below trend growth this year. Although the pace of job growth is moderating, labor markets remain solid, and the U.S. consumer has demonstrated resiliency. Market participants and the Federal Reserve are maintaining very divergent views regarding the future trajectory of monetary policy. Given the cumulative effects of tighter monetary policy and stress in the banking sector, we believe the Federal Reserve is likely near a pause in their rate hiking campaign. If moderate growth continues, we believe the Fed will likely maintain the Federal Funds rate in restrictive territory until inflationary pressures subside. At the March meeting, the Federal Open Market Committee voted unanimously to raise the target federal funds rate by 0.25% to a range of 4.75 — 5.00%. Fed Chair Powell reiterated the committee's focus on bringing down inflation to their 2% target; however, the committee softened language about "ongoing increases" in rates in the prior statement to "some additional policy firming may be appropriate". The statement also emphasized that the U.S. banking system is "sound and resilient" and acknowledged the tightening of financial conditions. The Chandler team believes the FOMC is likely near a pause in their rate hiking cycle. In March, the yield curve inversion narrowed. The 2-year Treasury yield plummeted 79 basis points to 4.03%, the 5-year Treasury yield plunged 61 basis points to 3.58%, and the 10-year Treasury yield fell 45 basis points to 3.47%. The inversion between the 2-year Treasury yield and 10-year Treasury yield declined to -56 basis points at March month -end versus -90 basis points at February month -end. There was no spread between the 2-year Treasury and 10-year Treasury yield one year ago — the yields were approximately equal. The inversion between 3-month and 10-year Treasuries widened to -128 in March from -89 basis points in February. The shape of the yield curve indicates that the probability of recession is increasing. 3 CJJJ DocuSign Envelope ID: 1B402188-3A73-46F1-87CC-E2B36D2F262E Employment Nonfarm Payroll (000's) F-01ft 0 700 0 c 600 500 u 400 0 300 Coll' 100 Non -farm Payroll (000's) 3 month average (000's) 0 ✓ S 047 ✓ S O Pe�1 dre��� PPc�� �ar�� Source: US Department of Labor 12.0% 10.0% 8.0% ' 6.0% 4.0% 2.0% 0.0% Unemployment Rate -Underemployment Rate(U6) -Unemployment Rate (U3) ✓ S O 0 10 �1 Pc�1 Source: US Department of Labor ✓ S O The U.S. economy added 236,000 jobs in March, and the prior two months were revised downward by 17,000. Although the pace of job growth is moderating, employment remains strong, with the three-month moving average payrolls at 345,000 and the six-month moving average at 315,000. The private sector reported broad gains, led by leisure and hospitality. The unemployment rate fell to 3.5% due to a sharp rise in the number of people employed, and the participation rate increased to 62.6% from 62.5% in February. The U-6 underemployment rate, which includes those who are marginally attached to the labor force and employed part time for economic reasons, declined to 6.7%from the prior month at 6.8%. Average hourly earnings rose 4.2%year-over-year in March, down from a 4.6% increase in February. Job Openings dipped to 9.9 million, the first drop below 10 million since May of 2021. While the overall pace of hiring is slowing, levels remain consistent with a solid labor market. 4 C11% DocuSign Envelope ID: 1B402188-3A73-46F1-87CC-E2B36D2F262E Inflation 10.0% 9.0 % 8.0 % 7.0 % v 6.0 % r 5.0% 0 4.0% 0 ' 3.0% 2.0 % 1.0 % 0.0 % Consumer Price Index (CPI) CPI YOY % Change Core CPI YOY % Change �06 �a` �4g �oil. �66 �d` �4� �91, �06 Source: US Department of Labor 10.0% 9.0 % 8.0 % 7.0 % v 20 6.0 % M s 5.0% 0 } 4.0% 0 } 3.0% 2.0% 1.0% 0.0% Personal Consumption Expenditures (PCE) .c('6 Source: US Department of Commerce r"l.L r"1 11,C: UICI IQIVI I V I /U I H.. IrC PCE Core Deflator YOY % Change �06�� The Consumer Price Index (CPI) increased in February 0.4% month -over -month and 6.0% year -over -year, down from 6.4% in January. The Core CPI, which excludes volatile food and energy components, rose 0.5% month -over -month and 5.5% year -over -year, decelerating from 5.6% in January. Shelter costs were the primary factor in the headline CPI representing 70% of the increase. Of note, used car prices experienced a significant drop of 13.6% when compared to a year ago, the largest decline since 1960. The Personal Consumption Expenditures (PCE) index rose 5.0% year -over -year in February, improving from a 5.3°% year -over -year gain in January. Core PCE, the Federal Reserve's preferred inflation gauge, increased 4.6% year -over -year in February, the smallest increase since October 2021. Inflationary trends are declining but remain above the Fed's 2%target. 5 C11% DocuSign Envelope ID: 1B402188-3A73-46F1-87CC-E2B36D2F262E IConsumer Retail Sales YOY % Change 60.0% 50.0% 40.0% 0 30.0% 0 20.0% 10.0% 0.0 % APb�1 1 Source: US Department of Commerce Consumer Confidence 140 130 120 a, J 110 x a� = 100 90 80 ti °,c ✓ S G� 06 ark 4/2, e,,1 Source: The Conference Board 00 11 ,3 ',�? Advance Retail Sales fell -0.4% in February, but prior months were revised higher. Retail sales rose 5.4% year -over -year in February, versus January's upwardly revised 7.7% year -over -year gain. The overall report exceeded expectations and points toward the resilience of the U.S. consumer. The Conference Board's Consumer Confidence Index unexpectedly increased to 104.2 in March from 103.4 in February. While high inflation and recession concerns remain top of mind for many consumers, the strong labor market and low unemployment continue to support the strength in Consumer Confidence. 6 c1" DocuSign Envelope ID: 1B402188-3A73-46F1-87CC-E2B36D2F262E IEconomic Activity Leading Economic Indicators (LEI) 1.5 1.0 v ao r 0.5% U -0.5% -1.0% ,cPb�Z �d`� g4g�1 1 Source: The Conference Board Chicago Fed National Activity Index (CFNAI) 1.00 0.75 0.50 �o a 0.25 s c 0.00 M -0.25 -0.50 Source: Federal Reserve Bank of Chicago The Conference Board's Leading Economic Index (LEI) remained in negative territoryfor the eleventh consecutive month at-0.3% in February, unchanged from -0.3% in January. The LEI was down 6.5% year -over -year in February versus down 5.9% year -over -year in January. The consistent decline month -over -month continues to signal future contraction in the economy. The Chicago Fed National Activity Index (CFNAI) declined to -0.19 in February from +0.23 in January. On a 3-month moving average basis, the CFNAI increased to -0.13 in February from -0.27 in January, indicating a rate of growth below the historical average trend. 7 C11% DocuSign Envelope ID: 1B402188-3A73-46F1-87CC-E2B36D2F262E IHousing 2000 7 1800 w 1600 0 1400 c N 1200 3 1000 800 v 600 u 400 5 0 200 0 Housing Starts —= M_0 qm— Multi Family Housing Starts ■ Single Family Housing Starts APb �aG �4� �o� �Pb ��` 14� �% �Pb Source: US Department of Commerce S&P/Case-Shiller 20 City Composite Home Price Index 24.0% 21.0% 18.0% 15.0% c f0 12.0% ; 9.0% 0 } 6.0% 3.0% 0.0% Source: S&P Total housing starts rose 9.8% month -over -month in February to 1,450,000 units and were down 18.4% compared to February 2022. Starts for both single-family and multi -family homes increased as mortgage rates declined from recent peaks. The 30-year fixed rate mortgage fell to an average of 6.24% according to Freddie Mac, down from a peak of 7.08°% in October, but up from 4.67% a year ago. According to the Case-Shiller 20-City Home Price Index, the year -over -year increase continued its declining rate of gain to +2.55% in January from +4.62% in December, clearly displaying the impact of higher mortgage rates year -over -year, which have reduced demand for homebuying as affordability has declined. This is the lowest rate of annual appreciation since December 2019. 8 C11% DocuSign Envelope ID: 1B402188-3A73-46F1-87CC-E2B36D2F262E IManufacturing 66 64 62 60 58 56 54 52 50 48 46 44 42 40 Institute of Supply Management Purchasing Manager Index ✓ S O ✓ S O Source: Institute for Supply Management 20.0% 15.0% 10.0% u 5.0 % 0 } 0.0% -5.0% -10.0% Source: Federal Reserve Industrial Production �oG�1 xPb�d`�� 9���� �oA 06 The Institute for Supply Management (ISM) manufacturing index fell to 46.3 in March from 47.7 in February. This is the fifth consecutive month of readings below 50.0, which is indicative of contraction in the manufacturing sector. All components weakened, including the headline, new orders, employment, and prices. Industrial production was flat in February after an upward revision to +0.3% in January. This equates to a - 0.25% decline from the prior year. Capacity utilization remained at 78.0% in February versus a downwardly revised 78.0% in January and has fallen below the 1972-2021 average of 79.6%. 9 C11% DocuSign Envelope ID: 1B402188-3A73-46F1-87CC-E2B36D2F262E Gross Domestic Product (GDP) ComponentsDP Personal Consumption Expenditures 0.9% 1.4% Gross Private Domestic Investment 1.0% -2.8% Net Exports and Imports -3.1% 1.2% Federal Government Expenditures -0.4% -0.2% State and Local (Consumption and Gross 0.0% -0.1% Investment) Total Source: US Department of Commerce is IM 40.0% 35.0% 30.0% 1.5% 0.7% 25.0% 20.0% 15.0% -1.8% 0.8% 10.0% 5.0 0.0 2.9% 0.4% -5.0% -10.0% 0.2% 0.4% -15.0% -20.0% -25.0% 0.4% 4-35.0% -30.0% -1.6% -0.6% 3.3% 2.6% Gross Domestic Product (GDP) 175 4 4 ,79 19 1-110 "�? Source: US Department of Commerce According to the third estimate, fourth quarter 2022 GDP growth was revised downward to 2.6% from 2.7%. The revision lower was primarily due to weaker growth in personal consumption expenditures and a wider trade gap in net exports. The consensus estimate calls for 1.6% growth in the first quarter and 1.0% growth for the full year 2023. 10 C11% DocuSign Envelope ID: lB402188-3A73-46F1-87CC-E2B36D2F262E Federal Reserve 10,000,000 111 111 J-1911111M 7,000,000 0 E 6,000,000 S 5,000,000 4,000,000 3,000,000 2,000,000 Federal Reserve Balance Sheet Assets Oe O� 6 6 Oe 6 6 Oe O� 6 O� Oe 6 c1 c1 c1 c1 "? c1 c1 c1 c1 c1 c� c,1 c� O 1 � .�' st S 6 � � 9 O 1 � Source: Federal Reserve 5.00% 4.50% 4.00% 3.50% 3.00% 2.50% } 2.00% 1.50% 1.00% 0.50% 0.00% Effective Federal Funds Rate O� O� 0 6 6 6 O� O� 6 6 6 O� O� c1 c1 c1 c1 c1 c1 c1 c? c1 c1 01 " c� c� O 1 �' ,V S 6 8 9 O 1 � Source: Bloomberg At the March meeting, the Federal Open Market Committee voted unanimously to raise the target federal funds rate by 0.25% to a range of 4.75 — 5.00%. Fed Chair Powell reiterated the committee's focus on bringing down inflation to their 2% target; however, the committee softened language about "ongoing increases" in rates in the prior statement to "some additional policy firming may be appropriate". The statement also emphasized that the U.S. banking system is "sound and resilient" and acknowledged the tightening in financial conditions. Powell indicated that the extent of these effects is uncertain but speculated that tighter credit conditions could be equivalent to a rate hike or more. The Summary of Economic Projections was little changed, with the consensus target federal funds rate rising to 5.1% by the end of 2023 (implying one more quarter point hike), falling to 4.3% in 2024 (up from 4.1% previously), and declining to 3.1% by the end of 2025. No rate cuts were in the Fed's base case for this year, contrary to the market consensus. Although projections imply policymakers are winding down interest rate hikes, the statement clearly reflected optionality for the Fed to remain data dependent. The Chandlerteam believes the Fed is likely near a pause in their rate hiking cycle. DocuSign Envelope ID: 1B402188-3A73-46F1-87CC-E2B36D2F262E I Bond Yields 5.0% — 4.5% 4.0% 3.5% 3.0% v 2.5% } 2.0% 1.5% 1.0% 0.5% 0.0% 1 Source: Bloomberg US Treasury Note Yields 2-Year 6.0 % 5.0 % 4.0 % 3.0% v 2.0 % 1.0 % Source: Bloomberg US Treasury Yield Curve Mar-23 Dec-22 • Mar-22 `b yr At the end of March, the 2-year Treasury yield was 169 basis points higher, and the 10-Year Treasury yield was about 113 basis points higher, year -over -year. The inversion between the 2-year Treasury yield and 10-year Treasury yield narrowed to -56 basis points at March month -end versus -90 basis points at February month -end. The average historical spread (since 2003) is about +130 basis points. The inversion between 3- month and 10-year Treasuries widened to -128 in March from -89 basis points in February. The shape of the yield curve indicates that the probability of recession is increasing. 12 C," ,CDocuSign Envelope ID: 1B402188-3A73-46F1-87CC-E2B36D2F262E T Section 2 I Account Profile 13 c►► DocuSign Envelope ID: 1B402188-3A73-46F1-87CC-E2B36D2F262E Objectives Investment Objectives As of March 31, 2023 The investment objectives of the City of Tustin 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 which might be reasonably anticipated; and third, to earn a commensurate rate of return. Chandler Asset Management Performance Objective The performance objective for the accounts is to achieve a rate of return over a market cycle that equals or exceeds the return on a market index of similar duration and sector allocation. Strategy In order to achieve these objectives, the portfolio invests in high quality fixed income securities consistent with the investment policy and California Government Code. 14 cJ" DocuSign Envelope ID: 1B402188-3A73-46F1-87CC-E2B36D2F262E compliance As of March 31, 2023 City of Tustin Consolidated This portfolio is a consolidation of assets managed by Chandler Asset Management and assets managed internally by Client. Chandler relies on Client to provide accurate information for reporting assets and producing this compliance statement. Category Standard Comment U.S. Treasuries No limit; 5 years max maturity Complies Federal Agencies 50% max per issuer; 5 years max maturity Complies Supranational Obligations Municipal Securities (CA, Other States) Corporate Medium Term Notes Agency Mortgage Pass -Through Securities Negotiable Certificates of Deposit (NCD) Certificate of Deposit Placement Service (CDARS) Collateralized Bank Deposits/ Time or Certificates of Deposit Bankers' Acceptances Commercial Paper Money Market Mutual Funds Local Agency Investment Fund (LAIF) "AA" rated or better by a NRSRO; 5% max; 5% max per issuer; 5 years max maturity; USD denominated senior unsecured unsubordinated obligations issued or unconditionally guaranteed by one of the three supranational banking groups: IBRD, IFC, and Complies IADB; Supranational securities will not be purchased until further notice from staff at the City of Tustin. 30% max; 5% max per issuer; 5 years max maturity "A" rating or better by a NRSRO; 30% max; 5% max per issuer; 10% max of any single issuer (combined issuer limitation of a local Complies agency's investments in commercial paper and medium -term notes); 5 years max maturity; Obligations of a domestic corporation or depository institution; If the credit rating of a security is downgraded below the minimum rating level for a new investment of that Complies security, the Treasurer shall evaluate the downgrade on a case -by -case basis to determine if the security should be held or sold. "AA" rated or better by a NRSRO; 20% max; 10% max per issuer; 5 years max maturity; Only invest in mortgage pass -through Complies securities that are guaranteed by U.S. government or a government -sponsored enterprise Any amount above FDIC insured limit must be issued by institutions with "A-1" short-term debt rating or higher by a NRSRO; or "A" Complies long-term rating category or higher by a NRSRO; 30% max; 5% max per issuer; 5 years max maturity 30% max; FDIC insured; The City may utilize these at the discretion of the Treasurer Complies 30% max per issuer; 5 years max maturity; All active (checking/savings accounts) and inactive (time or certificates of deposit) above Complies FDIC insured limits must be collateralized pursuant to California Government Code (CGC) "A" rating or better by Moody's or equivalent rating by a NRSRO; 30% max; 5% max per issuer; 180 days maturity Complies A-1/P-1 rating or equivalent by a NRSRO, plus A long term rating by a NRSRO; 30% max, 5% max per issuer; 10% max of any single issuer (combined issuer limitation of a local agency's investments in commercial paper and medium -term notes); 10% max outstanding from a single issuer; 270 days max maturity; "'Prime" quality commercial paper with the highest rating by a NRSRO; The entity that issues the commercial paper shall meet all conditions in either (A) or (B): (A) 1. Organized and operating in the U.S. as a general corporation; 2. Has total net assets >$500 million; 3. Has debt other than commercial paper, if any, that is "A" rating Complies category or higher by a NRSRO; or (B) 1. Organized within the U.S. as a special purpose corporation, trust, or LLC; 2. Has program wide credit enhancements including, but not limited to, overcollateralization, letters of credit or surety bond; and 3. "A-1" rated or higher by a NRSRO AAA or highest ranking of two of the three highest ranking NRSRO; Retain an investment adviser registered with SEC with > 5 years experience investing assets of at least $500 million; Must invest solely in investments, which the City itself could legally purchase; Complies 20% max; 10% max per Money Market Mutual Fund Max amount limited to the amount as specified by LAIF; Principal amount withdrawal of $10 million or > needs 24-hour notice, and Complies less than $10 million may be withdrawn the same day; Not used by investment adviser 15 Q DocuSign Envelope ID: 1B402188-3A73-46F1-87CC-E2B36D2F262E compliance As of March 31, 2023 City of Tustin Consolidated This portfolio is a consolidation of assets managed by Chandler Asset Management and assets managed internally by Client. Chandler relies on Client to provide accurate information for reporting assets and producing this compliance statement. Category Standard Comment Local Government Investment Pool (LGIP)/ Max amount permitted by County Treasurer; Investment in OCIP is allowable according to guidelines in Government Code; Not used Orange County Investment Pool (OCIP) by investment adviser Complies 50% max per issuer; 5 years max maturity; Shares of beneficial interest issued by a joint powers' authority organized pursuant to Joint Powers Authority (JPA) Investment Section 6509.7 that invests in securities and obligations authorized in subdivisions (a) to (q), inclusive; The JPA must retain an Complies Pools investment advisor that is SEC registered or exempt from registration with Assets > $500 million, and >5 years experience investing in instruments authorized by CGC Repurchase Agreements 30% max; 5% max per issuer; 1 year max maturity; 102% Collateralized; Not used by investment adviser Complies Inverse floaters, range notes, mortgage derived interest -only strips; zero interest accrual if held to maturity; Reverse Repurchase Agreements; Securities on margin, credit, or for other than full cash payment, and shall not be pledged as collateral; Purchase of Prohibited Complies security with a forward settlement date >45 days from the time of investment; Supranational securities will not be purchased until further notice from staff at the City of Tustin. Weighted Average Maturity 36 months max Complies Maximum Maturity 5 years from the date of settlement, unless authorized by City Council Complies The City of Tustin maintains adequate liquidity to cover at least six months of expected disbursements. 16Q DocuSign Envelope ID: 1B402188-3A73-46F1-87CC-E2B36D2F262E Portfolio Characteristics City of Tustin Consolidated Account Average Maturity (yrs) 2.62 0.70 0.66 Average Modified Duration 2.50 0.65 0.61 Average Purchase Yield n/a 3.49% 2.86% Average Market Yield 4.02% 4.24% 3.65% Average Quality" AAA AAA/Aa2 AA+/Aa2 Total Market Value 200,771,679 203,244,523 *ICE BofA 1-5 Yr US Treasury & Agency Index **Benchmark is a blended rating of S&P, Moody's, and Fitch. Portfolio is S&P and Moody's respectively. As of March 31, 2023 17 C," DocuSign Envelope ID: 1B402188-3A73-46F1-87CC-E2B36D2F262E Sector Distribution US Treasury 13.2 % Negotiable CD 0.9 % Money Market 4k Fund 1.9% Local Gov Investment Pool 35.8% March 31, 2023 Commercial Paper Age 1.0% 9 &.(A City of Tustin Consolidated Account ncy 9% Cash 4.1% CMO 0.S% Corporate 15.0% LAI F 17.7% December 31, 2022 US Treasury 11.4% Negotiable CD 0.9 % Money Market Fund 0.1% Local Gov Investment Pool 31.8% Agency 4.5 % As of March 31, 2023 Cash 3.7 % CMO 0.5 % Corporate 14.2 % LAIF 32.9% $19,846,996.66 $8,244,230.32 - $982,950.50 $30,200,947.75 $9,138,069.32 $7,544,324.69 $978,521.60 $28,950,120.79 $35,579,362.27 $71,784,897.98 - $3,776,472.39 - $1,885,422.95 - $66,763,462.36 $64,685,943.61 $152,180.50 - $1,899,130.71 $26,532,691.70 M $1,937,706.66 $23,132,769.78 18 Q DocuSign Envelope ID: 1B402188-3A73-46F1-87CC-E2B36D2F262E Portfolio Allocation As of March 31, 2023 City of Tustin Consolidated Account Local Gov 35.8% Investment Pool 31.8% LAI F Corporate - US Treasury - Agency �011 4.5% Cash 4.1% 3.7% Money Market 1.9% Fund 1 0.1% Commercial M 1.0% Paper 0.0% Negotiable CD M 0.9% 0.9% CIVIC) 0 0.5% 0.5% 17.7% 1S.0% 14.2% - 13.2% 11.4% 9.9 % 32.9% ■ 03/31/23 ■ 12/31/22 19 C11% DocuSign Envelope ID: 1B402188-3A73-46F1-87CC-E2B36D2F262E IIssuers City of Tustin Consolidated Account - Account #10795 As of March 31, 2023 CAMP Local Gov Investment Pool 35.75% Local Agency Investment Fund LAIF 17.72% Government of United States US Treasury 13.22% Federal Home Loan Bank Agency 8.47% Bank Cash Account Cash 4.11% First American Govt Oblig Fund Money Market Fund 1.88% MUFG Bank Ltd/NY Commercial Paper 0.97% 1P Morgan Chase & Co Corporate 0.94% Federal National Mortgage Association Agency 0.92% US Bancorp Corporate 0.65% Morgan Stanley Corporate 0.50% Northern Trust Corp Corporate 0.50% Qualcomm Inc Corporate 0.50% Toyota Motor Corp Corporate 0.49% Federal Farm Credit Bank Agency 0.49% Federal Home Loan Mortgage Corp CMO 0.49% Chubb Corporation Corporate 0.49% Home Depot Corporate 0.49% Paccar Financial Corporate 0.49% Duke Energy Field Services Corporate 0.48% Mass Mutual Insurance Corporate 0.48% Target Corp Corporate 0.48% Salesforce.com Inc Corporate 0.47% National Rural Utilities Corporate 0.47% Deere & Company Corporate 0.47% New York Life Global Funding Corporate 0.47% Bank of Montreal Chicago Corporate 0.47% State Street Bank Corporate 0.47% Bank of America Corp Corporate 0.47% Metlife Inc Corporate 0.47% Bank of New York Corporate 0.47% Pfizer Inc. Corporate 0.46% Caterpillar Inc Corporate 0.46% United Health Group Inc Corporate 0.46% Amazon.com Inc Corporate 0.45% Toronto Dominion Holdings Corporate 0.45% Royal Bank of Canada Corporate 0.45% Charles Schwab Corp/The Corporate 0.44% 20 C1" DocuSign Envelope ID: 1B402188-3A73-46F1-87CC-E2B36D2F262E IIssuers City of Tustin Consolidated Account — Account #10795 As of March 31, 2023 Wal-Mart Stores Corporate 0.40% Northwestern Mutual Glbl Corporate 0.35% MasterCard Inc Corporate 0.24% Colgate-Palmolive Co. Corporate 0.17% Sallie Mae Bank Negotiable CD 0.12% UBS Corp Negotiable CD 0.12% Delaware State Police FCU Negotiable CD 0.12% Capital One Negotiable CD 0.12% Ally Bank Negotiable CD 0.12% Synchrony Financial Negotiable CD 0.12% Discover Financial Services Negotiable CD 0.12% Goldman Sachs Inc. Negotiable CD 0.11% TOTAL 100.00% 21 c1" DocuSign Envelope ID: 1B402188-3A73-46F1-87CC-E2B36D2F262E IMaturity Distribution As of March 31,2023 $140,000,000.00 $120,000,000.00 $100,000,000.00 $80,000,000.00 $60,000,000.00 $40,000,000.00 $20,000,000.00 $0.00 City of Tustin Consolidated Account 0-.25 .25-.5 .5-1 1-2 2-3 3-4 4-5 5+ Maturity (Yrs) 22 Q1 DocuSign Envelope ID: 1B402188-3A73-46F1-87CC-E2B36D2F262E Quality Distribution 50.0% 45.0% 40.0 % 35.0% 30.0% 25.0% 20.0% 15.0% 10.0 % 5.0% 0.0% AAA City of Tustin Consolidated Account March 31, 2023 vs. December 31, 2022 AA A <A ■ March 31, 2023 December 31, 2022 NR As of March 31, 2023 03/31/23 12/31/22 44.9% 19.6% 31.9% 18.6% 12.2% 11.5% 0.0% 23.3 % 0.0% 38.0% Source: S&P Ratings 23 c1" DocuSign Envelope ID: 1B402188-3A73-46F1-87CC-E2B36D2F262E I Duration Distribution 80.0 % 70.0 % 60.0% 50.0% 40.0 % 30.0 % 20.0% 10.0 % 0.0% 0 - 0.25 City of Tustin Consolidated Account March 31, 2023 vs. December 31, 2022 =— 0 1 ■ � � 0.25-0.50 0.50-1 1-2 2-3 3-4 4-5 ■ March 31, 2023 December 31, 2022 5+ As of March 31, 2023 03/31/23 60.3% 3.7% 10.4% 13.9% 8.5% 1.5% 1.6% 0.0% 12/31/22 69.6% 0.9% 4.0% 10.1% 10.2% 4.5% 0.9% 0.0% 24 c1" DocuSign Envelope ID: 1B402188-3A73-46F1-87CC-E2B36D2F262E IInvestment Performance 1.50% 1.00% 0.50% 0.00 % -0.50 % -1.00% -1.50 % -2.00 % City of Tustin Consolidated Account Total Rate of Return Annualized Since Inception November 30, 2020 ■ As of March 31, 2023 0 1 -2.50 % 12 months 2 years 3 years 5 years 10 years Since Inception ■ City of Tustin Consolidated Account ICE BofA 1-5 Yr US Treasury & Agency Index ■ ICE BofA 1-3 Yr US Treasury & Agency Index Annualized TOTAL RATE OF RETURN 3 months 12 months 2 years 3 years 5 years 10 years Since Inception City of Tustin Consolidated Account 0.92% 1.08% 0.29% N/A N/A N/A 0.31% ICE BofA 1-5 Yr US Treasury & Agency Index 1.81% -0.38% -2.06% N/A N/A N/A -1.96% ICE BofA 1-3 Yr US Treasury & Agency Index 1.55% 0.19% -1.33% N/A N/A N/A -1.14% REALIZED RATE OF RETURN 3 months 12 months 2 years 3 years 5 years 10 years Since Inception City of Tustin Consolidated Account 0.77% 2.02% 1.32% N/A N/A N/A 1.30% 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 thE25 C," ending market value; it includes interest earnings, realized and unrealized gains and losses in the portfolio. Realized rate of return: A measure of a portfolio's return overtime. It is the internal rate which equates the beginning book value of the portfolio with the ending book value; it includes interest earnings, realized gains and losses in the portfolio. DocuSign Envelope ID: 1B402188-3A73-46F1-87CC-E2B36D2F262E Section 3 1 Portfolio Holdings 26 C♦' DocuSign Envelope ID: 1B402188-3A73-46F1-87CC-E2B36D2F262E Holdings Report City of Tustin Consolidated Account - Account #10795 As of March 31, 2023 agency 313384NH8 FHLB Discount Note 3,000,000.00 03/29/2023 2,918,801.67 97.31 2,919,195.84 1.45% P-1 / A-1+ 0.56 4.730% Due 10/23/2023 4.92% 2,919,195.84 4.92% 0.00 0.00 F-1+ 0.55 3130ATBLO FHLB Note 2,250,000.00 09/08/2022 2,248,110.00 99.22 2,232,495.00 1.12% Aaa / AA+ 0.69 3.625% Due 12/08/2023 3.70% 2,248,957.38 4.78% 25,601.56 (16,462.38) NR 0.66 313384RB7 FHLB Discount Note 3,000,000.00 03/28/2023 2,894,053.33 96.51 2,895,213.33 1.44% P-1/A-1+ 0.75 4.640% Due 12/28/2023 4.84% 2,895,213.33 4.84% 0.00 0.00 F-1+ 0.73 313384RR2 FHLB Discount Note 3,000,000.00 03/30/2023 2,890,366.67 96.36 2,890,750.00 1.44% P-1 / A-1+ 0.78 4.600% Due 01/11/2024 4.80% 2,890,750.00 4.80% 0.00 0.00 F-1+ 0.77 3133845V2 FHLB Discount Note 2,000,000.00 03/28/2023 1,919,244.44 96.00 1,920,011.11 0.96% P-1/A-1+ 0.86 4.600% Due 02/08/2024 4.81% 1,920,011.11 4.81% 0.00 0.00 F-1+ 0.84 3130ARHG9 FHLB Note 1,250,000.00 03/24/2022 1,248,575.00 97.72 1,221,453.75 0.61% Aaa / AA+ 0.92 2.125% Due 02/28/2024 2.19% 1,249,326.91 4.71% 2,434.90 (27,873.16) NR 0.88 3133ENL40 FFCB Note 1,000,000.00 09/08/2022 997,520.00 98.64 986,442.00 0.49% Aaa / AA+ 1.46 3.500% Due 09/13/2024 3.63% 998,198.52 4.47% 1,750.00 (11,756.52) AAA 1.39 3133XVDG3 FHLB Note 1,000,000.00 09/26/2022 998,060.00 99.78 997,848.00 0.50% Aaa / AA+ 1.46 4.375% Due 09/13/2024 4.48% 998,563.26 4.53% 2,187.50 (715.26) NR 1.39 3130APQ81 FHLB Callable Note Mnthly 12/8/2021 1,000,000.00 08/01/2022 954,220.00 94.76 947,629.00 0.47% Aaa / AA+ 1.61 1.000% Due 11/08/2024 3.11% 967,584.00 4.42% 3,972.22 (19,955.00) NR 1.55 313OAQF40 FHLB Note 1,000,000.00 08/01/2022 955,420.00 94.61 946,096.00 0.47% Aaa / AA+ 1.73 1.000% Due 12/20/2024 2.95% 967,806.18 4.28% 2,805.56 (21,710.18) AAA 1.67 3135G04Z3 FNMA Note 2,000,000.00 04/12/2021 1,982,980.00 92.41 1,848,222.00 0.92% Aaa / AA+ 2.22 0.500% Due 06/17/2025 0.71% 1,990,988.10 4.13% 2,888.89 (142,766.10) AAA 2.15 20,007,351.11 19,805,356.03 9.89% Aaa / AAA 1.04 TOTAL Agency 20,500,000.00 3.88% 20,046,594.63 4.68% 41,640.63 (241,238.60) AAA 1.00 Cash CBGMMF$04 Citizens Business Bank Citizens Business Bank Cash 223,529.36 12/31/2022 223,529.36 1.00 223,529.36 0.11% NR/NR 0.00 0.00% 223,529.36 0.00% 0.00 0.00 NR 0.00 90BOFA$00 Cash BOA Cash Acct 334,924.56 Various 334,924.56 1.00 334,924.56 0.17% NR/NR 0.00 0.25% 334,924.56 0.25% 0.00 0.00 NR 0.00 27 Q11 DocuSign Envelope ID: 1B402188-3A73-46F1-87CC-E2B36D2F262E Holdings Report City of Tustin Consolidated Account - Account #10795 As of March 31, 2023 CBGMMF$03 Citizens Business Bank Citizens Business Bank Cash 7,685,776.40 Various 7,685,776.40 1.00 7,685,776.40 3.83% NR/NR 0.00 0.00% 7,685,776.40 0.00% 0.00 0.00 NR 0.00 8,244,230.32 8,244,230.32 4.11% NR/NR 0.00 TOTAL Cash 8,244,230.32 0.01% 8,244,230.32 0.01% 0.00 0.00 NR 0.00 CMO 3137BDCW4 FHLMC K039 A2 1,000,000.00 04/19/2022 1,007,968.75 98.02 980,198.00 0.49% NR/NR 1.32 3.303% Due 07/25/2024 2.75% 1,004,540.80 4.95% 2,752.50 (24,342.80) AAA 1.09 1,007,968.75 980,198.00 0.49% NR / NR 1.32 TOTAL CMO 1,000,000.00 2.75% 1,004,540.80 4.95% 2,752.50 (24,342.80) AAA 1.09 Commercial Paper 62479MY64 MUFG Bank Ltd/NY Discount CP 2,000,000.00 03/28/2023 1,936,853.33 96.89 1,937,706.66 0.97% P-1 / A-1 0.60 5.120% Due 11/06/2023 5.34% 1,937,706.66 5.34% 0.00 0.00 NR 0.59 1,936,853.33 1,937,706.66 0.97% P-1 / A-1 0.60 TOTAL Commercial Paper 2,000,000.00 5.34% 1,937,706.66 5.34% 0.00 0.00 NR 0.59 Corporate 89236TFNO Toyota Motor Credit Corp Note 1,000,000.00 02/28/2019 1,019,000.00 99.10 991,007.00 0.49% Al / A+ 0.47 3.450% Due 09/20/2023 3.00% 1,001,962.76 5.41% 1,054.17 (10,955.76) A+ 0.46 79466LAG9 Salesforce.com Inc Callable Note Cont 7/15/2022 1,000,000.00 04/25/2022 951,860.00 94.98 949,788.00 0.47% A2 / A+ 1.29 0.625% Due 07/15/2024 2.88% 972,007.48 4.68% 1,319.44 (22,219.48) NR 1.25 59217GEPO Metlife Note 1,000,000.00 01/18/2022 979,170.00 93.88 938,811.00 0.47% Aa3 / AA- 1.50 0.700% Due 09/27/2024 1.49% 988,427.78 5.02% 77.78 (49,616.78) AA- 1.45 24422EVY2 John Deere Capital Corp Note 1,000,000.00 02/04/2022 985,080.00 94.67 946,698.00 0.47% A2 / A 1.78 1.250% Due 01/10/2025 1.78% 990,910.97 4.40% 2,812.50 (44,212.97) A+ 1.72 57629WCG3 Mass Mutual Global funding Note 1,000,000.00 03/23/2022 1,004,360.00 96.55 965,538.00 0.48% Aa3 / AA+ 1.79 2.950% Due 01/11/2025 2.79% 1,002,774.55 5.00% 6,555.56 (37,236.55) AA+ 1.69 64952WEK5 New York Life Global Note 1,000,000.00 01/18/2022 996,780.00 94.47 944,711.00 0.47% Aaa / AA+ 1.79 1.450% Due 01/14/2025 1.56% 998,068.00 4.71% 3,101.39 (53,357.00) AAA 1.72 63743HFC1 National Rural Utilities Note 1,000,000.00 03/23/2022 972,740.00 94.82 948,196.00 0.47% A2 / A- 1.86 1.875% Due 02/07/2025 2.87% 982,397.83 4.83% 2,812.50 (34,201.83) A 1.78 57636QAN4 MasterCard Inc Callable Note 1x 02/03/2025 500,000.00 11/01/2021 515,365.00 95.66 478,312.50 0.24% Aa3 / A+ 1.93 2.000% Due 03/03/2025 1.06% 508,870.25 4.38% 777.78 (30,557.75) NR 1.85 28 Q11 DocuSign Envelope ID: 1B402188-3A73-46F1-87CC-E2B36D2F262E Holdings Report City of Tustin Consolidated Account - Account #10795 As of March 31, 2023 69371RR73 Paccar Financial Corp Note 1,000,000.00 03/31/2022 999,740.00 96.54 965,412.00 0.49% Al / A+ 2.02 2.850% Due 04/07/2025 2.86% 999,825.16 4.67% 13,775.00 (34,413.16) NR 1.90 87612EBL9 Target Corp Callable Note Cont 4/15/25 1,000,000.00 02/04/2022 1,010,340.00 96.08 960,754.00 0.48% A2 / A 2.04 2.250% Due 04/15/2025 1.91% 1,006,629.35 4.28% 10,375.00 (45,875.35) A 1.94 437076CM2 Home Depot Callable Note Cont 3/15/2025 1,000,000.00 03/28/2022 995,620.00 96.69 966,927.00 0.49% A2 / A 2.04 2.700% Due 04/15/2025 2.85% 997,065.56 4.41% 12,450.00 (30,138.56) A 1.93 61747YEQ4 Morgan Stanley Callable Note S/A 4/17/2024 1,000,000.00 06/01/2022 1,000,910.00 98.17 981,677.00 0.50% Al / A- 2.05 3.620% Due 04/17/2025 4.43% 1,000,648.02 5.43% 16,491.11 (18,971.02) A+ 0.99 06406RAN7 Bank of NY Mellon Corp Callable Note Cont 3/24/2025 1,000,000.00 02/04/2022 989,120.00 92.95 929,472.00 0.47% Al / A 2.07 1.600% Due 04/24/2025 1.95% 992,994.43 5.25% 6,977.78 (63,522.43) AA- 1.97 06367WB85 Bank of Montreal Note 1,000,000.00 08/17/2021 1,034,530.00 93.66 936,588.00 0.47% A2 / A- 2.09 1.850% Due 05/01/2025 0.90% 1,019,450.28 5.10% 7,708.33 (82,862.28) AA- 1.99 91159HHZ6 US Bancorp Callable Note Cont 4/11/2025 1,400,000.00 12/23/2021 1,406,818.00 92.08 1,289,145.20 0.65% A2 / A+ 2.12 1.450% Due 05/12/2025 1.30% 1,404,275.79 5.47% 7,838.06 (115,130.59) A+ 2.02 747525AFO Qualcomm Inc Callable Note Cont 2/20/2025 1,000,000.00 03/23/2022 1,018,960.00 98.15 981,547.00 0.50% A2 / A 2.14 3.450% Due 05/20/2025 2.82% 1,012,837.50 4.36% 12,554.17 (31,290.50) NR 2.01 717081EX7 Pfizer Inc. Callable Note Cont 4/28/2025 1,000,000.00 03/23/2022 945,010.00 92.75 927,530.00 0.46% Al / A+ 2.16 0.800% Due 05/28/2025 2.62% 962,644.72 4.35% 2,733.33 (35,114.72) A 2.09 66815L2J7 Northwestern Mutual Glbl Note 700,000.00 06/30/2022 703,738.00 98.53 689,742.90 0.35% Aaa / AA+ 2.25 4.000% Due 07/01/2025 3.81% 702,813.77 4.69% 7,000.00 (13,070.87) AAA 2.10 26442UAA2 Duke Energy Progress LLC Callable Note Cont 5/15/25 1,000,000.00 04/25/2022 1,000,280.00 96.91 969,056.00 0.48% Aaa / A 2.38 3.250% Due 08/15/2025 3.24% 1,000,201.29 4.64% 4,152.78 (31,145.29) NR 2.24 194162AM5 Colgate Palmolive Co. Note 345,000.00 08/01/2022 344,682.60 97.45 336,195.95 0.17% Aaa / AA- 2.38 3.100% Due 08/15/2025 3.13% 344,750.29 4.24% 1,366.58 (8,554.34) NR 2.25 89114QCK2 Toronto Dominion Bank Note 1,000,000.00 08/17/2021 993,000.00 90.15 901,517.00 0.45% Al / A 2.45 0.750% Due 09/11/2025 0.93% 995,783.02 5.09% 416.67 (94,266.02) AA- 2.36 14913R2H9 Caterpillar Financial Service Note 1,000,000.00 04/21/2021 991,780.00 91.24 912,442.00 0.46% A2 / A 2.62 0.800% Due 11/13/2025 0.98% 995,275.35 4.38% 3,066.67 (82,833.35) A 2.53 857477BR3 State Street Bank Callable Note Cont 2/6/2025 1,000,000.00 Various 978,258.70 93.89 938,856.00 0.47% Al / A 2.86 1.746% Due 02/06/2026 3.57% 983,978.48 5.25% 2,667.50 (45,122.48) AA- 1.78 06051GHY8 Bank of America Corp Callable Note Cont 2/13/2025 1,000,000.00 04/20/2021 1,030,470.00 93.69 936,901.00 0.47% A2 / A- 2.88 2.015% Due 02/13/2026 2.13% 1,018,181.47 5.61% 2,686.67 (81,280.47) AA- 1.79 29 Q1 DocuSign Envelope ID: 1B402188-3A73-46F1-87CC-E2B36D2F262E Holdings Report City of Tustin Consolidated Account - Account #10795 As of March 31, 2023 46647PBK1 JP Morgan Chase & Co Callable Note Cont 4/22/2025 2,000,000.00 Various 2,072,110.00 93.57 1,871,464.00 0.94% Al / A- 3.06 2.083% Due 04/22/2026 2.24% 2,046,754.44 5.42% 18,399.84 (175,290.44) AA- 1.95 00440EAV9 Chubb INA Holdings Inc Callable Note Cont 2/3/2026 1,000,000.00 07/23/2021 1,102,780.00 96.72 967,153.00 0.49% A3 / A 3.09 3.350% Due 05/03/2026 1.13% 1,066,591.52 4.50% 13,772.22 (99,438.52) A 2.85 023135BX3 Amazon.com Inc Callable Note Cont 4/12/2026 1,000,000.00 05/12/2021 995,200.00 90.66 906,641.00 0.45% Al / AA 3.12 1.000% Due 05/12/2026 1.10% 997,007.89 4.23% 3,861.11 (90,366.89) AA- 3.00 808513BR5 Charles Schwab Corp Callable Note Cont 4/13/2026 1,000,000.00 07/23/2021 1,007,990.00 87.79 877,887.00 0.44% A2 / A 3.12 1.150% Due 05/13/2026 0.98% 1,005,192.82 5.46% 4,408.33 (127,305.82) A 2.97 91324PEC2 United Health Group Inc Callable Note Cont 4/15/2026 1,000,000.00 07/28/2021 1,007,110.00 90.93 909,250.00 0.46% A3 / A+ 3.13 1.150% Due 05/15/2026 1.00% 1,004,631.66 4.29% 4,344.44 (95,381.66) A 2.99 78016EZT7 Royal Bank of Canada Note 1,000,000.00 07/28/2021 999,090.00 89.67 896,706.00 0.45% Al / A 3.29 1.150% Due 07/14/2026 1.17% 999,396.69 4.57% 2,459.72 (102,690.69) AA- 3.15 931142ERO Wal-Mart Stores Callable Note Cont 08/17/2026 900,000.00 09/22/2021 902,277.00 90.15 811,317.60 0.40% Aa2 / AA 3.47 1.050% Due 09/17/2026 1.00% 901,583.51 4.13% 367.50 (90,265.91) AA 3.33 665859AW4 Northern Trust Company Callable Note Cont 4/10/2027 1,000,000.00 01/30/2023 986,540.00 97.97 979,654.00 0.50% A2 / A+ 4.11 4.000% Due 05/10/2027 4.35% 987,049.39 4.55% 15,666.67 (7,395.39) A+ 3.68 31,940,709.30 30,006,897.15 15.04% Al / A+ 2.37 TOTAL Corporate 31,845,000.00 2.15% 31,890,982.02 4.82% 194,050.60 (1,884,084.87) AA- 2.10 LAW or 90LAIF$00 Local Agency Investment Fund State Pool 35,215,729.34 Various 35,215,729.34 1.00 35,215,729.34 17.72% NR/NR 0.00 2.88% 35,215,729.34 2.88% 363,632.93 0.00 NR 0.00 35,215,729.34 35,215,729.34 17.72% NR/NR 0.00 TOTAL LAIF 35,215,729.34 2.88% 35,215,729.34 2.88% 363,632.93 0.00 NR 0.00 30 Q11 DocuSign Envelope ID: 1B402188-3A73-46F1-87CC-E2B36D2F262E Holdings Report City of Tustin Consolidated Account - Account #10795 Local Gov Investment Pool 90CAMP$00 California Asset Mgmt Program CAMP 71,784,897.98 Various 71,784,897.98 1.00 71,784,897.98 4.92% 71,784,897.98 4.92% 0.00 As of March 31, 2023 35.75% NR/AAA 0.00 0.00 NR 0.00 71,784,897.98 71,784,897.98 35.75% NR / AAA 0.00 TOTAL Local Gov Investment Pool 71,784,897.98 4.92% 71,784,897.98 4.92% 0.00 0.00 NR 0.00 Money Market Fund 31846V203 First American Govt Obligation Fund Class Y 3,534,965.41 Various 3,534,965.41 1.00 3,534,965.41 1.76% Aaa / AAA 0.00 4.32% 3,534,965.41 4.32% 0.00 0.00 AAA 0.00 31846V203 First American Govt Obligation Fund Class Y 241,506.98 Various 241,506.98 1.00 241,506.98 0.12% Aaa / AAA 0.00 4.32% 241,506.98 4.32% 0.00 0.00 AAA 0.00 3,776,472.39 3,776,472.39 1.88% Aaa / AAA 0.00 TOTAL Money Market Fund 3,776,472.39 4.32% 3,776,472.39 4.32% 0.00 0.00 AAA 0.00 Negotiable CD 795450M93 Sallie Mae Bank Negotiable CD 245,000.00 04/18/2018 245,000.00 99.90 244,759.66 0.12% NR/NR 0.05 3.000% Due 04/18/2023 3.00% 245,000.00 4.93% 3,322.60 (240.34) NR 0.05 903481CW8 UBS Bank USA Negotiable CD 248,000.00 06/13/2018 248,000.00 99.65 247,130.51 0.12% NR/NR 0.20 3.250% Due 06/13/2023 3.25% 248,000.00 4.99% 419.56 (869.49) NR 0.20 246399AB5 Delaware State Police FCU Negotiable CD 246,000.00 03/29/2019 246,000.00 97.96 240,973.48 0.12% NR/NR 1.00 3.000% Due 03/29/2024 3.00% 246,000.00 5.13% 60.66 (5,026.52) NR 0.97 14042TJB4 Capital One Bank USA NA Negotiable CD 240,000.00 08/01/2022 239,640.00 96.74 232,183.44 0.12% NR/NR 2.35 3.450% Due 08/04/2025 3.50% 239,719.09 4.93% 1,293.04 (7,535.65) NR 2.21 02007GXF5 Ally Bank Negotiable CD 240,000.00 08/02/2022 239,280.00 96.63 231,920.16 0.12% NR/NR 2.35 3.400% Due 08/04/2025 3.51% 239,437.66 4.93% 1,251.95 (7,517.50) NR 2.21 87165EXE2 Synchrony Bank Negotiable CD 240,000.00 08/01/2022 239,640.00 96.63 231,912.00 0.12% NR/NR 2.35 3.400% Due 08/05/2025 3.45% 239,718.50 4.93% 1,229.59 (7,806.50) NR 2.21 254673P26 Discover Bank Negotiable CD 240,000.00 08/01/2022 239,280.00 96.62 231,887.52 0.12% NR/NR 2.36 3.400% Due 08/08/2025 3.51% 239,435.04 4.93% 1,162.52 (7,547.52) NR 2.22 38149MYS6 Goldman Sachs Bank USA Negotiable CD 245,000.00 08/17/2021 243,775.00 88.03 215,669.58 0.11% NR/NR 3.41 1.050% Due 08/25/2026 1.15% 244,166.79 4.91% 246.68 (28,497.21) NR 3.27 _ 1,940,615.00 1,876,436.35 0.94% NR/NR 1.71 TOTAL Negotiable CD 1,944,000.00 3.04% 1,941,477.08 4.96% 8,986.60 (65,040.73) NR 1.63 31 Q11 DocuSign Envelope ID: 1B402188-3A73-46F1-87CC-E2B36D2F262E Holdings Report As of March 31, 2023 City of Tustin Consolidated Account - Account #10795 US Treasury 9128281369 US Treasury Note 1,250,000.00 03/23/2022 1,248,828.13 99.50 1,243,800.00 0.62% Aaa / AA+ 0.17 1.625% Due 05/31/2023 1.70% 1,249,837.62 4.58% 6,808.04 (6,037.62) AAA 0.17 912828S92 US Treasury Note 1,250,000.00 03/23/2022 1,239,697.27 98.84 1,235,547.50 0.62% Aaa / AA+ 0.33 1.250% Due 07/31/2023 1.87% 1,247,476.46 4.73% 2,589.78 (11,928.96) AAA 0.33 9128282D1 US Treasury Note 1,300,000.00 05/18/2022 1,283,191.41 98.63 1,282,175.70 0.64% Aaa / AA+ 0.42 1.375% Due 08/31/2023 2.40% 1,294,552.44 4.73% 1,554.35 (12,376.74) AAA 0.41 912796CQO US Treasury Bill 4,000,000.00 03/29/2023 3,913,218.67 97.86 3,914,251.78 1.95% P-1 / A-1+ 0.46 4.649% Due 09/14/2023 4.82% 3,914,251.78 4.82% 0.00 0.00 F-1+ 0.45 912828T91 US Treasury Note 1,200,000.00 04/25/2022 1,187,296.88 98.23 1,178,812.80 0.59% Aaa / AA+ 0.59 1.625% Due 10/31/2023 2.34% 1,195,107.12 4.73% 8,187.85 (16,294.32) AAA 0.57 912828U57 US Treasury Note 1,250,000.00 03/23/2022 1,251,416.02 98.32 1,229,003.75 0.62% Aaa / AA+ 0.67 2.125% Due 11/30/2023 2.06% 1,250,558.59 4.71% 8,902.82 (21,554.84) AAA 0.65 912828V80 US Treasury Note 1,250,000.00 03/23/2022 1,252,832.03 97.96 1,224,462.50 0.61% Aaa / AA+ 0.84 2.250% Due 01/31/2024 2.12% 1,251,274.00 4.77% 4,661.60 (26,811.50) AAA 0.81 912828X70 US Treasury Note 1,250,000.00 03/23/2022 1,245,019.53 97.25 1,215,673.75 0.61% Aaa / AA+ 1.08 2.000% Due 04/30/2024 2.19% 1,247,438.43 4.63% 10,497.24 (31,764.68) AAA 1.04 912828WJ5 US Treasury Note 1,000,000.00 04/25/2022 998,593.75 97.80 977,969.00 0.49% Aaa / AA+ 1.13 2.500% Due 05/15/2024 2.57% 999,231.25 4.53% 9,461.33 (21,262.25) AAA 1.08 91282CCL3 US Treasury Note 1,250,000.00 03/23/2022 1,197,802.73 94.98 1,187,305.00 0.59% Aaa / AA+ 1.29 0.375% Due 07/15/2024 2.24% 1,220,870.95 4.41% 984.12 (33,565.95) AAA 1.26 9128282U3 US Treasury Note 1,250,000.00 03/23/2022 1,238,085.94 96.61 1,207,568.75 0.60% Aaa / AA+ 1.42 1.875% Due 08/31/2024 2.28% 1,243,073.53 4.37% 2,038.04 (35,504.78) AAA 1.37 912828YM6 US Treasury Note 1,250,000.00 03/23/2022 1,224,902.34 95.80 1,197,461.25 0.60% Aaa / AA+ 1.59 1.500% Due 10/31/2024 2.30% 1,234,735.77 4.27% 7,872.93 (37,274.52) AAA 1.53 912828YV6 US Treasury Note 1,250,000.00 03/23/2022 1,223,486.33 95.64 1,195,507.50 0.60% Aaa / AA+ 1.67 1.500% Due 11/30/2024 2.32% 1,233,557.20 4.23% 6,284.34 (38,049.70) AAA 1.61 912828YYO US Treasury Note 1,300,000.00 05/18/2022 1,263,335.94 95.94 1,247,187.50 0.62% Aaa / AA+ 1.76 1.750% Due 12/31/2024 2.88% 1,275,480.67 4.18% 5,718.92 (28,293.17) AAA 1.69 91282CBH3 US Treasury Note 2,000,000.00 04/27/2021 1,957,500.00 90.78 1,815,546.00 0.90% Aaa / AA+ 2.84 0.375% Due 01/31/2026 0.83% 1,974,680.85 3.84% 1,243.09 (159,134.85) AAA 2.77 91282CBT7 US Treasury Note 2,000,000.00 04/27/2021 1,989,531.25 91.49 1,829,766.00 0.91% Aaa / AA+ 3.00 0.750% Due 03/31/2026 0.86% 1,993,624.43 3.78% 40.98 (163,858.43) AAA 2.92 91282CFM8 US Treasury Note 1,740,000.00 11/09/2022 1,724,978.91 101.88 1,772,760.72 0.88% Aaa / AA+ 4.50 4.125% Due 09/30/2027 4.32% 1,726,173.87 3.67% 196.11 46,586.85 AAA 4.08 32 Q1 DocuSign Envelope ID: 1B402188-3A73-46F1-87CC-E2B36D2F262E I Holdings Report City of Tustin Consolidated Account - Account #10795 As of March 31, 2023 91282CGH8 US Treasury Note 1,500,000.00 02/23/2023 1,458,281.25 99.48 1,492,149.00 0.75% Aaa / AA+ 4.84 3.500% Due 01/31/2028 4.13% 1,459,023.74 3.62% 8,701.66 33,125.26 AAA 4.39 26,897,998.38 26,446,948.50 13.22% Aaa / AA+ 1.63 TOTAL US Treasury 27,290,000.00 2.65% 27,010,948.70 4.36% 85,743.20 (564,000.20) AAA 1.54 202,752,825.90 200,074,872.72 100.00% Aa2 / AAA 0.70 TOTAL PORTFOLIO 203,600,330.03 3.49% 202,853,579.92 4.24% 696,806.46 (2,778,707.20) AA+ 0.65 TOTAL MARKET VALUE PLUS ACCRUALS 200,771,679.18 33 C1" ,CDocuSign Envelope ID: 1B402188-3A73-46F1-87CC-E2B36D2F262E T Section 4 1 Transactions W40 DocuSign Envelope ID: 1B402188-3A73-46F1-87CC-E2B36D2F262E ITransaction Ledger City of Tustin Consolidated Account - Account #10795 December 31, 2022 through March 31, 2023 As of March 31, 2023 ACQUISITIONS Purchase 01/13/2023 90LAIF$00 350,183.47 Local Agency Investment Fund State Pool 1.000 2.23% 350,183.47 0.00 350,183.47 0.00 Purchase 01/31/2023 90CAMP$00 263,970.84 California Asset Mgmt Program CAMP 1.000 4.56% 263,970.84 0.00 263,970.84 0.00 Purchase 02/01/2023 665859AW4 1,000,000.00 Northern Trust Company Callable Note Cont 98.654 4.35% 986,540.00 9,000.00 995,540.00 0.00 4/10/2027 4% Due:05/10/2027 Purchase 02/28/2023 90CAMP$00 258,672.61 California Asset Mgmt Program CAMP 1.000 4.75% 258,672.61 0.00 258,672.61 0.00 Purchase 02/28/2023 91282CGH8 1,500,000.00 US Treasury Note 97.219 4.13% 1,458,281.25 4,060.77 1,462,342.02 0.00 3.5% Due: 01/31/2028 Purchase 03/29/2023 313384RB7 3,000,000.00 FHLB Discount Note 96.468 4.84% 2,894,053.33 0.00 2,894,053.33 0.00 4.64% Due: 12/28/2023 Purchase 03/29/2023 313384SV2 2,000,000.00 FHLB Discount Note 95.962 4.81% 1,919,244.44 0.00 1,919,244.44 0.00 4.6% Due: 02/08/2024 Purchase 03/29/2023 62479MY64 2,000,000.00 MUFG Bank Ltd/NY Discount CP 96.843 5.34% 1,936,853.33 0.00 1,936,853.33 0.00 5.12% Due: 11/06/2023 Purchase 03/30/2023 912796CQO 4,000,000.00 US Treasury Bill 97.830 4.82% 3,913,218.67 0.00 3,913,218.67 0.00 4.649% Due: 09/14/2023 Purchase 03/31/2023 313384NH8 3,000,000.00 FHLB Discount Note 97.293 4.92% 2,918,801.67 0.00 2,918,801.67 0.00 4.73% Due: 10/23/2023 Purchase 03/31/2023 313384RR2 3,000,000.00 FHLB Discount Note 96.346 4.80% 2,890,366.67 0.00 2,890,366.67 0.00 4.6% Due: 01/11/2024 Purchase 03/31/2023 90CAMP$00 291,310.92 California Asset Mgmt Program CAMP 1.000 4.92% 291,310.92 0.00 291,310.92 0.00 Subtotal 20,664,137.84 20,081,497.20 13,060.77 20,094,557.97 0.00 Security 01/31/2023 90CAMP$00 6,285,000.00 California Asset Mgmt Program CAMP 1.000 6,285,000.00 0.00 6,285,000.00 0.00 Contribution Subtotal 6,285,000.00 6,285,000.00 0.00 6,285,000.00 0.00 TOTAL ACQUISITIONS 26,949,137.84 26,366,497.20 13,060.77 26,379,557.97 0.00 35 C1" DocuSign Envelope ID: 1B402188-3A73-46F1-87CC-E2B36D2F262E ITransaction Ledger City of Tustin Consolidated Account - Account #10795 December 31, 2022 through March 31, 2023 As of March 31, 2023 DISPOSITIONS Maturity 01/31/2023 91282CBG5 1,000,000.00 US Treasury Note 100.000 1,000,000.00 0.00 1,000,000.00 0.00 0.125% Due:01/31/2023 Maturity 02/28/2023 91282CBNO 1,250,000.00 US Treasury Note 100.000 1,250,000.00 0.00 1,250,000.00 0.00 0.125% Due:02/28/2023 Subtotal 2,250,000.00 2,250,000.00 0.00 2,250,000.00 0.00 Security 01/11/2023 90LAIF$00 1,565,000.00 Local Agency Investment Fund State Pool 1.000 1,565,000.00 0.00 1,565,000.00 0.00 Withdrawal Security 01/19/2023 90LAIF$00 2,000,000.00 Local Agency Investment Fund State Pool 1.000 2,000,000.00 0.00 2,000,000.00 0.00 Withdrawal Security 01/20/2023 90LAIF$00 6,000,000.00 Local Agency Investment Fund State Pool 1.000 6,000,000.00 0.00 6,000,000.00 0.00 Withdrawal Security 03/03/2023 90LAIF$00 2,000,000.00 Local Agency Investment Fund State Pool 1.000 2,000,000.00 0.00 2,000,000.00 0.00 Withdrawal Security 03/24/2023 90LAIF$00 9,000,000.00 Local Agency Investment Fund State Pool 1.000 9,000,000.00 0.00 9,000,000.00 0.00 Withdrawal Security 03/27/2023 90LAIF$00 11,000,000.00 Local Agency Investment Fund State Pool 1.000 11,000,000.00 0.00 11,000,000.00 0.00 Withdrawal Subtotal 31,565,000.00 31,565,000.00 0.00 31,565,000.00 0.00 TOTAL DISPOSITIONS 33,815,000.00 33,815,000.00 0.00 33,815,000.00 0.00 36 C11% DocuSign Envelope ID: 1B402188-3A73-46F1-87CC-E2B36D2F262E IImportant Disclosures As of March 31,2O23 2023 Chandler Asset Management, Inc, An Independent Registered Investment Adviser. Information contained herein is confidential. Prices are provided by ICE Data Services Inc ("IDS"), an independent pricing source. In the event IDS 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 use of 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 in, related to, or derived therefrom. Neither ICE data, its affiliates or their respective third party providers guarantee the quality, adequacy, accuracy, timeliness or completeness of the indices or the index data or any component thereof, and the indices and index data and all components thereof are provided on an "as is" basis and licensee's use it at licensee's own risk. ICE data, its affiliates and their respective third party do not sponsor, endorse, or recommend chandler asset management, or any of its products or services. This report is provided for informational purposes only and should not be construed as a specific investment or legal advice. The information contained herein was obtained from sources believed to be reliable as of the date of publication, but may become outdated or superseded at any time without notice. Any opinions or views expressed are based on current market conditions and are subject to change. This report may contain forecasts and forward -looking statements which are inherently limited and should not be relied upon as indicator of future results. Past performance is not indicative of future results. This report is not intended to constitute an offer, solicitation, recommendation or advice regarding any securities or investment strategy and should not be regarded by recipients as a substitute for the exercise of their own judgment. Fixed income investments are subject to interest, credit and market risk. Interest rate risk: the value of fixed income investments will decline as interest rates rise. Credit risk: the possibility that the borrower may not be able to repay interest and principal. Low rated bonds generally have to pay higher interest rates to attract investors willing to take on greater risk. Market risk: the bond market in general could decline due to economic conditions, especially during periods of rising interest rates. 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. 37 cJ" DocuSign Envelope ID: lB402188-3A73-46F1-87CC-E2B36D2F262E Benchmark Disclosures As of March 31,2023 ICE BofA 1-5 Yr 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 1-3 Yr 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. 38 cJT&: , DocuSign Envelope ID: 1B402188-3A73-46F1-87CC-E2B36D2F262E CITY OF TUSTIN Monthly Investment Report March 31, 2023 Restricted Deposits with Fiscal Agents Ill Description / Limits [21 [31 [4] Face Amount Shares YTM@Cost Credit Rating Cost Value+Accrued Interest 151 Market Value 2016 Successor Agency Tax Allocation Bonds, Refunding 1,194.16 N/A 1,194.16 1,194.16 2016 Water Revenue Bonds, Refunding 343,858.73 N/A 343,858.73 343,858.73 2012 Water Revenue Bonds - Refunding 979,790.32 N/A 979,790.32 979,790.32 2020 Water Revenue Bonds 405,680.28 N/A 405,680.28 405,680.28 CFD 04-1 839,976.05 N/A 839,976.05 839,976.05 CFD 06-1 5,087,177.00 N/A 5,087,177.00 5,087,177.00 CFD 07-1 1,399,037.75 N/A 1,399,037.75 1,399,037.75 CFD 14-1 3,117,417.87 N/A 3,117,417.87 3,117,417.87 12,174,132.16 12,174,132.16 12,174,132.16 Restricted Deposits with Fiscal Agents TOTAL 12,174,132.16 12,174,132.16 DocuSign Envelope ID: lB402188-3A73-46F1-87CC-E2B36D2F262E PUBLIC AGENCY RETIREMENT SERVICES PARS CITY OF TUSTIN Account Report for the Period PARS Post -Employment Benefits Trust 3/1/2023 to 3/31/2023 Matthew West City Manager City of Tustin 300 Centennial Way Tustin, CA 92780 Account Summary Balance as of Balance as of Source 3/1/2023 Contributions Earnings Expenses Distributions Transfers 3/31/2023 OPEB $2,785,243.97 $500,000.00 $64,598.88 $1,215.34 $0.00 $0.00 $3,348,627.51 PENSION $8,476,576.25 $2,000,000.00 $206,446.01 $3,698.09 $0.00 $0.00 $10,679,324.17 Totals $11,261,820.22 $2,500,000.00 $271,044.89 $4,913.43 $0.00 $0.00 $14,027,951.68 Investment Selection Source OPEB City of Tustin - OPEB PENSION City of Tustin - Pension Investment Objective Source Individual account based on Moderate Index PLUS. The dual goals of the Moderate Strategy are growth of principal and income. It is expected that OPEB dividend and interest income will comprise a significant portion of total return, although growth through capital appreciation is equally important. The portfolio will be allocated between equity and fixed income investments. Individual account based on Moderate Index PLUS. The dual goals of the Moderate Strategy are growth of principal and income. It is expected that PENSION dividend and interest income will comprise a significant portion of total return, although growth through capital appreciation is equally important. The portfolio will be allocated between equity and fixed income investments. Investment Return Annualized Return Source 1-Month 3-Months 1-Year 3-Years 5-Years 10-Years Plan's Inception Date OPEB 2.02% 4.39% -5.42% 7.19% 6/26/2018 PENSION 2.04% 4.41% -5.40% 7.19% 6/26/2018 Information as provided by US Bank, Trustee for PARS; Not FDIC Insured; No Bank Guarantee; May Lose Value Past performance does not guarantee future results. Performance returns may not reflect the deduction of applicable fees, which could reduce returns. Information is deemed reliable but may be subject to change. Investment Return: Annualized rate of return is the return on an investment over a period other than one year multiplied or divided to give a comparable one-year return. Account balances are inclusive of Trust Administration, Trustee and Investment Management fees Headquarters - 4350 Von Karman Ave., Suite 100, Newport Beach, CA 92660 800.540.6369 Fax 949.250.1250 www.pars.org