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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 />Deposits, continued <br />Effective July 1, 2008, House Bill 2901, which was passed during the 2007 Regular Session of the Oregon <br />Legislative Assembly, significantly revises Oregon Revised Statutes 295. The changes streamline the <br />collateralization process for bank depositories and local governments. The changes also create a shared <br />liability structure for participating bank depositories, better protecting public funds though still not guaranteeing <br />that all funds are 100% protected. Barring any exceptions, a bank depository is required to pledge collateral <br />valued at least 10% of their quarter-end public fund deposits if they are well capitalized, 25% of their quarter- <br />end public fund deposits if they are adequately capitalized, or 110% of their quarter-end public fund deposits if <br />they are undercapitalized or assigned to pledge 110% by the Office of State Treasurer. In the event of a bank <br />failure, the entire pool of collateral pledged by all qualified Oregon public funds bank depositories is available to <br />repay deposits of public funds of government entities. <br />Investments <br />As of June 30, 2008, the City held the following investments and maturities: <br />Investment type <br />Corporate securities <br />Local government investment pool <br />Municipal bonds <br />U.S. agency securities <br />U.S. treasury securities <br />Total <br /> Weighted <br /> average % of <br />Carrying maturity investment <br />value in years op rtf0110 <br />$ 11,099,433 0.327 7.0% <br />13,420,322 0.003 8.5% <br />8,096,486 0.350 5.1 <br />120,874,978 0.685 76.7% <br />4,168,209 1.149 2.7% <br />$ 157,659,428 0.597 100.0% <br />The "weighted average maturity in years" calculation assumes that all investments are held <br />until maturity. <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 /> Maximum Maximum <br /> of length <br />Investment type op rtf0110 to maturity <br />Bankers' acceptances 50% 6 months <br />Corporate securities 35% 18 months <br />Local government investment pool 100% 1 day <br />State and local government obligations - 50% 2 years <br />U.S. agency securities 100% 2 years <br />U.S. treasury securities 100% 3 years <br />continued <br />50 <br />