Audit and Finance Committee

REGULAR MEETING OF THE AUDIT AND FINANCE COMMITTEE DATE: MONDAY, OCTOBER 7, 2019 – 5:30 p.m. MEETING TO BE HELD AT THE JUSTICE CENTER 200 HIGHLANDS BOULEVARD DRIVE 2nd floor AGENDA 1. Call to Order: 2. Roll Call and Statement of Quorum 3. Establishment of Order of Items on the Agenda A. Approval of the August 5, 2019 Minutes B. City Administrator Larry Perney will provide an overview of the 2020 Budget. The Committee is not required to review, discuss or provide questions regarding the budget but are encouraged to. Tentative public meetings with the Board of Alderman and staff are scheduled for Tuesday October 22, 2019 and Thursday October 24, 2019 at 7 pm at the Parks Meeting Room, 359 Old Meramec Station Road, Manchester MO 63021. You are encouraged to attend. C. Liquidation report of remaining investments in TIF Reserve with maturities past 5-1- 2020 and Investment Report-holdings at September 30, 2019. A reserve account is not required for the 2019 refunding bonds and therefore the current reserve needs to be liquid to go towards paying off the 2010 bonds in November 2019. D. Update on Tax Increment and Transportation Refunding Revenue Bonds (Highway 141/Manchester Road Project), Series 2010. E. Schedule future meeting for Monday November 4, 2019 4. Adjournment  MINUTES OF THE AUDIT AND FINANCE COMMITTEE MEETING FOR MONDAY, AUGUST 5, 2019 AT THE JUSTICE CENTER 200 HIGHLANDS BOULEVARD DRIVE 1. CALL TO ORDER Chairman Bill Ward called the Audit and Finance Committee meeting to order at 5:31 pm. 2. ROLL CALL AND STATEMENT OF QUORUM Roll call showed those present were Peter Bitzer, Juli K. Van Hook, Alderman Baumann, Alderman Toben and Chairman Bill Ward. A quorum was present. Also in attendance were Ex-officio members Mayor Clement and City Administrator Larry Perney, Alderman Huether, and support staff Director of Finance Donald Yucuis. 3. ESTABLISHMENT OF ORDER OF ITEMS ON THE AGENDA Chairman Ward made the motion to approve the order of items on the agenda. The motion was seconded by Alderman Baumann and approved unanimously. A. Chairman Ward made a motion to approve the June 10, 2019 Audit & Finance Committee meeting Minutes, seconded by Peter Bitzer and approved unanimously. B. Director of Finance Yucuis and City Administrator Larry Perney presented and reviewed the 2019 six month report through June 30, 2019. General Fund is the main operating fund of the City and six months revenue was 55.5% of budget and expenses were 49.4% of budget which are both positive indicators. A summary of the other eight funds were presented and discussed with the Committee and all were in line with their budgets. C. A draft Internal Controls Policy was presented by Director of Finance Yucuis and discussed with the Committee. The policies were part of the 2018 audit and submitted to Stop and Vanhoy on May 3, 2019 for review. The Committee was instructed to get back with Director of Finance Yucuis with any suggested changes within two weeks. The Internal Control Policy would then become part of the September 3, 2019 Board of Alderman Agenda for formal action and approval. D. The Investment Report holdings with UMB Bank at July 31, 2019 for the Tax Increment Financing (TIF) Fund Reserve was presented and reviewed. The upcoming TIF re-financing may require the reserve to be 100% liquid. After discussion, Chairman Ward made a motion, seconded by Alderman Toben to request that Commerce Bank liquidate investments with Page 1  maturities past September 30, 2023 (listed as items 11 through 18. Motion carried unanimously by individual voice vote. E. City Administrator Perney updated the Committee on the status of the TIF Refunding and stated it was moving forward fairly quickly with Joy Howard soliciting a Request for Proposal to refund the bonds. F. The next meeting is scheduled for Monday October 7, 2019 at 5:30 pm at the Justice Center 200 Highlands Boulevard. 4. ADJOURNMENT At 6:45 p.m., there being no further business, Peter Bitzer made a motion to adjourn, seconded by Chairman Ward and approved unanimously. Respectfully submitted, Donald J. Yucuis Director of Finance Note: This is a journal of the Audit and Finance Committee meeting of Monday, August 5, 2019 (summary); not a verbatim transcript. Page 2 October 7, 2019 Agenda Item 3 C Below is the summary of the liquidation of the remaining investments by Commerce Bank with maturities past 5-01-2020. The investments were required to be liquidated due to the upcoming Tax Increment Financing (TIF) bond issue and refunding of the 2010 TIF Bonds. The new 2019 TIF Bond Issue does not require a reserve fund. The current reserve fund will be used to pay of the 2010 TIF bond issue. The liquidation settlement dates were 09/26/2019 and 09/27/2019. "Holdings for (Manchester TIFTDD Series 2010 136106)"As of Date 09/19/2019Created 09/19/2019 11:57:24 AM EST % of Security Market Maturity Asset Commerce Description Identifier Value Date Class Rate bid Sale Amount Loss Federal National Mortgage Pool DTD 5/1/2013 1.7500% 5/1/2020 3138L3ZG3 136106 49,804.69 05/01/2020 0.98% 1.75 99.0000 49,306.64 Federal Home Loan Mortgage Corp Pool DTD 9/1/2006 5.5000% 9/1/2021 3128PEZM3 136106 16,566.57 09/01/2021 0.33% 5.50 100.6750 16,678.39 Freddie Mac DTD 10/1/2010 1.5000% 10/15/2022 3137GAUY1 136106 54,073.33 10/15/2022 1.06% 1.50 97.9560 52,968.07 Freddie Mac DTD 10/1/2010 2.0000% 3/15/2025 3137GASP3 136106 6,328.22 03/15/2025 0.12% 2.00 98.2500 6,217.48 Fannie Mae DTD 11/1/2010 3.5000% 8/25/2025 31398SUH4 136106 1,539.54 08/25/2025 0.44% 3.50 99.2500 1,527.99 Federal National Mortgage Assn DTD 11/1/2011 3.0000% 12/25/2025 3136A2F24 136106 6,860.15 12/25/2025 0.13% 3.00 99.4000 6,818.99 Federal National Mortgage Association DTD 7/1/2011 3.5000% 3/25/2026 3136A0TK3 136106 21,363.95 03/25/2026 0.42% 3.50 99.6000 21,278.49 Federal National Mortgage Pool DTD 8/1/2011 3.5000% 8/1/2026 31416Y2W7 136106 42,015.96 08/01/2026 0.83% 3.50 101.8625 42,798.51 198,552.41 197,594.57 (957.84) JP Morgan Chase Bank DTD 9/30/2013 0.000% Ser CD 9/30/2023 48124J4N5 136106 183,620.00 09/30/2023 ###### 0.00 90.3500 165,900.67 Citibank NA DTD 5/30/2013 0.000% 5/30/2033 172986GH8 136106 160,920.00 05/30/2033 ###### 0.00 65.2500 105,000.30 Market Value at 9/19/2019 344,540.00 270,900.97 (73,639.03) 543,092.41 468,495.54 (74,596.87) Agenda Item 3 C City of Manchester TIF Reserve Holdings at 9-30-19 "Holdings for (Manchester TIFTDD Series 2010 136106)"As of Date 09/30/2019Created 10/04/2019 03:33:45 PM EST Sub Asset Class Description % of Yield Market Value Maturity Date Government & Agency Bonds Federal Home Loan Bank Disc Nts DTD 10/15/2018 0.000% 10/15/2019 1.94% $ 4,648,604.04 10/15/2019 Government & Agency Bonds Federal Home Loan Mortgage Corp DTD 10/3/2012 1.500% 10/3/2019 1.50% $ 149,994.00 10/03/2019 Government & Agency Bonds Federal National Mortgage Assoc Pool DTD 10/1/2014 2.5900% 10/1/2019 2.59% $ 93,635.81 10/01/2019 Government & Agency Bonds Resolution Fdg Fed Bk Cpn St DTD 10/15/1989 10/15/2019 1.49% $ 8,992.71 10/15/2019 Money Market Funds MSILF Govt #8352 0.00% $ 3,840,576.93 Total Portfolio $ 8,741,803.49 Agenda Item 3 C City of Manchester TIF Reserve Holdings at 9‐30‐19 "Holdings for (Manchester TIFTDD Series 2010 136106)"As of Date 09/30/2019Created 10/04/2019 03:33:45 PM EST Sub Asset Class Description % of Yield Market Value Maturity Date Government & Agency Bonds Federal Home Loan Bank Disc Nts DTD 10/15/2018 0.000% 10/15/2019 1.94% $ 4,648,604.04 10/15/2019 Government & Agency Bonds Federal Home Loan Mortgage Corp DTD 10/3/2012 1.500% 10/3/2019 1.50% $ 149,994.00 10/03/2019 Government & Agency Bonds Federal National Mortgage Assoc Pool DTD 10/1/2014 2.5900% 10/1/2019 2.59% $ 93,635.81 10/01/2019 Government & Agency Bonds Resolution Fdg Fed Bk Cpn St DTD 10/15/1989 10/15/2019 1.49% $ 8,992.71 10/15/2019 Money Market Funds MSILF Govt #8352 0.00% $ 3,840,576.93 Total Portfolio $ 8,741,803.49 Oct 7, 2019 Audit and Finance