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City of Redwood City
<br />Notes to the Basic Financial Statements
<br />For the fiscal year ended June 30, 2017
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<br />NOTE 2 – CASH AND INVESTMENTS (CONTINUED)
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<br />Investment Valuation, Continued
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<br />Investment Type Fair Value Level 1 Level 2 Level 3
<br />Investments subject to levels
<br />Commercial paper/Bank acceptance 4,732,460$ 4,732,460$
<br />Corporate Notes 10,407,496 10,407,496
<br />Federal Farm Credit Bank 2,982,810 2,982,810
<br />Federal Home Loan Bank 7,972,210 7,972,210
<br />Federal Home Loan Mortgage Corporation 26,139,172 26,139,172
<br />Federal National Mortgage Association 28,713,410 28,713,410
<br />Money Market 105,369 105,369
<br />US Treasury Notes 58,483,915 58,483,915
<br />Total investments subject to levels 139,536,842 58,483,915 81,052,927
<br />Investment not subject to levels
<br />San Mateo County Pool 45,476,002
<br />Local Agency Investment Fund 77,966,510
<br />Total investments 262,979,354$ 58,483,915$ 81,052,927$
<br />Fair Value Measurement Using
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<br />Treasury securities categorized as Level 1 are valued based on prices quoted in active markets for those
<br />securities. Federal Farm Credit Bank Bonds, Federal Home Loan Banks, Federal Home Loan Mortgage
<br />Corporate Notes, Federal National Mortgage Association Notes and Corporate Notes categorized as Level
<br />2 are valued based on matrix pricing which use observable market inputs such as yield curves and market
<br />indices that are derived principally from or corroborated by observable market data by correlation to
<br />other means.
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<br />C. Restricted Cash
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<br />The City’s restricted cash consisted of $7,904,047 in cash and investments as of June 30, 2017 held by
<br />trustees or fiscal agents. The City had $12,829,042 in restricted cash and investments held by the City.
<br />This restricted cash is pledged for the payment or security of certain bonds, certificates of participation,
<br />and lease obligations. The California government code provides that these monies, in the absence of
<br />specific statutory provisions governing the issuance of bonds, certificates, or leases, may be invested in
<br />accordance with the ordinance, resolutions, or indentures specifying the types of investments its
<br />trustees or fiscal agents may make. In some situations, these investments differ from those permitted by
<br />the City investment policy. Included in these investments at June 30, 2017 is a guaranteed investment
<br />contract with a maturity date in fiscal year 2035 authorized in the bond indenture and by City Council
<br />prior to purchase.
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<br />6.1.E. - Page 73
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