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CITY OF EUGENE, OREGON <br />Notes to Basic Financial Statements <br />(4) Detailed Notes on All Funds, continued <br />(A) Equity in Pooled Cash and Investments, continued <br />The Oregon State Treasurer maintains the Oregon Short Term Fund (OSTF), of which the Local Government <br />Investment Pool (LGIP) is a part. Participation by local governments is voluntary. The State of Oregon <br />investment policies are governed by statute and the Oregon Investment Council. In accordance with Oregon <br />Statutes, funds are invested as a prudent investor would do, exercising reasonable care, skill and caution. The <br />LGIP was created to offer a short-term investment alternative to Oregon local governments and it is not <br />registered with the U.S. Securities and Exchange Commission. The investments are regulated by the OSTF <br />and approved by the Oregon Investment Council (ORS 294.805 to 294.895). At June 30, 2011, the fair value <br />of the City’s deposits with the LGIP approximates cost. The OSTF financial statements are available at <br />http://www.ost.state.or.us/. <br />The LGIP’s portfolio concentration of credit risk at June 30, 2011 included: Corporate Notes (45.8%), U.S. <br />Treasury and Agency Securities (38.5%), Government Guaranteed Corporate Securities (10.6%), Commercial <br />Paper (2.7%), Bank Notes (1.2%), Certificates of Deposits (0.6%) and Municipal Bonds (0.6%). The credit risk <br />associated with the investments was: AAA rating (48.0%), AA rating (18.2%), A rating (32.5%), BBB rating <br />(0.2%), not rated (0.6%) and ratings withdrawn (0.5%). <br />Concentration of Credit Risk <br />The City’s policy for investing in individual issuers varies depending on the type of investments. Agency <br />securities are restricted to no more than 25% for any one issuer. No more than 25% of the total portfolio of <br />investments may be invested in a single issuer of bankers’ acceptances. Investments in commercial paper or <br />corporate bonds of any one issuer may not exceed 5% of the investment portfolio. Investments in the <br />Temporary Liquidity Guarantee Program (TLGP) are limited to 5% per bank. The combined limit for each bank <br />in certificates of deposits, bankers’ acceptances, corporate indebtedness, and TLGP is 10%. <br />continued <br />51 <br />