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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, 2012, 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, 2012 included: Corporate Notes (46.9%), U.S. <br />Treasury and Agency Securities (41.1%), Government Guaranteed Corporate Securities (5.7%), Commercial <br />Paper (3.3%), Municipal Bonds (1.3%), Certificates of Deposits (0.9%), and Non-US Government Debt (0.8%). <br />The credit risk associated with the investments was: AA rating (36.3%), A rating (33.9%), BBB rating (7.1%), <br />and not rated (22.7%). <br />Concentration of Credit Risk <br />The City’s policy for investing in individual issuers varies depending on the type of investments. U.S. <br />Government Agency Securities are restricted to no more than 25% for any one issuer. No more than 25% of <br />the total portfolio of investments may be invested in a single issuer of bankers’ acceptances or repurchase <br />agreements. Investments in commercial paper or corporate bonds may not exceed more than 35% of the <br />portfolio and investments in 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 name and may not exceed more <br />than 25% of the investment portfolio. The combined limit for each bank in certificates of deposits, bankers’ <br />acceptances, corporate indebtedness, and TLGP is 10%. <br />continued <br />51 <br />