Subject: Cash Management Report For FY 2025-2026 Second Quarter Ended December 31, 2025 From: Finance Department Recommendation: Receive The Informational Cash Management Report For Fiscal Year 2025-2026 Second Quarter Ended December 31, 2025

The Finance Department's quarterly Cash Management Report for FY 2025-2026 Second Quarter, ending December 31, 2025, details the City's investment portfolios. The City's Operating Pool Portfolio increased from $2.09 billion to $2.17 billion, yielding 3.68%. This growth was primarily driven by $288.62 million in property tax revenues, partially offset by $39.42 million in debt service and $164.41 million in operational expenses. The Successor Agency's Portfolio saw a slight decrease from $16.99 million to $16.98 million, yielding 3.75%. Both portfolios maintain high credit quality and sufficient liquidity, complying with the City’s Investment Policy, and did not utilize leverage or derivatives. The City's portfolio outperformed the 1-year government agency benchmark (3.61%) but underperformed the Local Agency Investment Fund (LAIF) (4.03%). The report also notes a 25 basis point federal funds rate cut and continued economic expansion, though with a mixed labor market and elevated inflation.

This report confirms the City's financial assets are being managed prudently for safety and liquidity, which helps ensure funds are available for essential city services and future projects. Effective cash management contributes to the overall fiscal health and stability of the city, with no direct fiscal impact or cost from this informational item.

high