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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 />Interest Rate Risk
<br />As a means of limiting its exposure to losses arising from rising interest rates, the City’s investment policy limits
<br />investment as follows:
<br />MaximumMaximum
<br />% oflength
<br />Investment typeportfolioto maturity
<br />Bankers' acceptances25%6 months
<br />Corporate securities35%18 months
<br />Local government investment pool100%1 day
<br />State and local government obligations50%3 years
<br />U.S. agency securities100%3 years
<br />U.S. agency securities - Temporary
<br /> Liquidity Guarantee Program (TGLP)25%December 31, 2012
<br />U.S. treasury securities100%3 years
<br />With the exception of pass-through funds, the maximum amount of pooled investments to be placed in the
<br />Local Government Investment Pool is limited by Oregon Statute to $44,474,164, which will increase
<br />proportionately to the Portland Consumer Price Index. The limit can be temporarily exceeded for ten business
<br />days and does not apply either to pass-through funds or to funds invested on behalf of another governmental
<br />unit.
<br />Credit Risk
<br />The City’s policy, which adheres to State of Oregon law, is to limit its Corporate and Municipal investments as
<br />follows: Issuers within Oregon must be rated “A” (bonds) or A-2 / P-2 (commercial paper) or better by Standard
<br />and Poor’s, Moody’s Investors Service or any other nationally recognized statistical rating organization at time
<br />of purchase. Issuers not in Oregon must be rated AA / Aa (bonds) or A-1 / P-1 (commercial paper) or better at
<br />time of purchase.
<br />At June 30, 2012, the City’s investments were rated as follows:
<br />Highest Rating From
<br />Moody's Investors Service or Standard & Poor's Corporation
<br />Investment typeTotalAaa/AAAa/AAA/ADNot rated
<br />Corporate securities$6,872,81106,872,811000
<br />Local government
<br /> investment pool40,715,441000040,715,441
<br />Municipal bonds32,993,3562,303,77528,597,3401,369,335722,9060
<br />U.S. agency securities91,596,51491,596,5140000
<br />U.S. treasury securities1,999,8401,999,8400000
<br />Total$174,177,96295,900,12935,470,1511,369,335722,90640,715,441
<br />Subsequent to year end, the City received principal payments of $722,906 on the Greater Wenatchee Regional
<br />Events Center Public Facilities District Limited Sales Tax Bond Anticipation Notes, Series 2008. Standard &
<br />Poor’s Rating Services downgraded this security’s rating to “D” following the District’s failure to make scheduled
<br />principal payments on the bond anticipation notes on December 1, 2011.
<br />continued
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