BOARD MEETING DATE: December 5, 2008
AGENDA NO. 19

REPORT:

Investment Oversight Committee

SYNOPSIS:

The Investment Oversight Committee met Friday, November 21, 2008 and discussed various issues detailed in the Committee report. The next Investment Oversight Committee meeting is scheduled for Friday, February 20, 2009 at 12:00 noon in the Executive Office Conference Room.

RECOMMENDED ACTIONS:

Receive and file this report.
 

Michael Antonovich, Chair
Investment Oversight Committee

Attendance: Present at AQMD were Committee members Bill Campbell, David E. Ertel and Paul Sundeen. Michael Antonovich and Michael A. Cacciotti attended by teleconference. Absence was Committee member Gary Burton
 

Investment Committee Action Items:

Quarterly Report of Investments: Reviewed the quarterly investment report to the Governing Board. For the month of September 2008, the AQMD’s weighted average yield on total investments of $380,513,349, from all sources, was 3.33%. The allocation by investment type was 89.5% in the Los Angeles County Pooled Surplus Investment Fund (PSI) and 10.5% in the State of California Local Agency Investment Fund (LAIF). The Committee approved the quarterly report.
 

Investment Committee Discussion Items:

Cash Flow Forecast: Rick Pearce reported on the cash flows for the current year and projected for the next three years. AQMD Investment Policy limits its Special Purpose investments to 75% of the minimum amount of funds available for investment during the Cash Flow Horizon. That limit, which includes all funds (General, MSRC, Clean Fuels), is approximately $207.3 million.

Financial Market Update: Jim Martling provided the Committee with comments on current economic and investment market conditions. In summary, Mr. Martling’s comments stated that California’s unemployment rate has jumped to 8.2% (third highest in the country). Goldman Sachs came out with a cut in the US growth forecast. Best place to be is in fixed income, short duration investments – treasury securities, U.S. Agencies, government pools, short treasuries, a few industrial companies. Most of the state and local pools are in relatively good shape. Recessions are typically, eight to ten months long. Experts believe that this recession can last for a significantly longer time period, well over a year.

Calendar Year 2009 Committee Meeting Dates: For CY 2009, quarterly Investment Oversight Committee meeting dates are Friday, February 20, Friday, May 22, and Friday, November 20. The August quarterly meeting has been cancelled in conjunction with the cancellation of all AQMD Board and Committee meetings during the month of August 2009.
 

Other Business:

Rick Pearce provided a brief report on his activities regarding two AQMD Guaranteed Investment Contracts and he reported that the Los Angeles County Treasury Pool has not experienced an investment loss despite the recent market turbulence and restructuring of the nation’s financial system.
 

Public Comment: None