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HomeMy WebLinkAbout98.05-09-2018 Administration Committee Item 6 Attachment - FY 2017-18 Third Quarter Financial Report.pdf ORANGE COUNTY SANITATION DISTRICT Third Quarter Financial Report for the period ended March 31 , 2018 ENIP ,7 Orange County, California Table of Contents ExecutiveSummary...................................................................................................1 Budget Review Section 1 —Consolidated Financial Reports..........................................................................1 Section 2—Operating Budget Review Chart of the Cost per Million Gallons by Department—Budget and Actual..............1 Chart of the Net Expenses by Major Category— Budget and Actual........................1 Divisional Contributions to Cost Per Million Gallons ................................................2 Comparison of Expenses by Department.................................................................3 Summary of Collection, Treatment, and Disposal Expenses by Major Category.....4 Summary of District-Wide Revenues .......................................................................5 Summary of Collection, Treatment and Disposal Revenues....................................5 Summary of Collection, Treatment, and Disposal Expenses by Line Item...............6 Summary of Collection, Treatment, and Disposal Expenses by Process.................8 Chartof Staffing Trends...........................................................................................9 Section 3—Capital Improvement Program Budget Review Capital Improvement Program Graphs by Type and Funding Source......................1 Summary of Capital Improvement Construction Requirements- Current Year........2 Summary of Capital Improvement Construction Requirements - Project Life..........6 Section 4—Capital Assets Schedule & Debt Service Budget Review CapitalAssets Schedule ..........................................................................................1 Debt Service Budget Review....................................................................................1 Section 5—Self Insurance Budget Review General Liability and Property Fund Budget Review................................................1 Workers' Compensation Fund Budget Review.........................................................2 Quarterly Treasurers Repo rt........................................................................................1 QuarterlyCOP Reoort.................................................................................................1 FY 2017-18 Third Quarter Financial Report This Page Intentionally Left Blank Executive Summary Consolidated Financial Reports For the Third Quarter Ended March 31, 2018 Included in this consolidated report are the following quarterly financial reports for the period ended March 31, 2018: • Third Quarter Budget Review: The Consolidated Financial Reports Section provides the Directors, staff, and the general public with a comprehensive overview of the financial results of the Sanitation District through the third quarter ended March 31, 2018. Contained within the Consolidated Financial Reports is the budget-to-actual status of the Collections, Treatment and Disposal Operations, the Capital Improvement Program, the Self-Insurance Program, and Debt Service Outlays. Also included is a Capital Assets Schedule as of March 31, 2018. The chart below provides for a summary of these activities. Third Quarter Results as a Percentage of Budget 90.0% 80.0% $107.91M 65.6M 70.0% $292.3M $1.SM 60.0% $86.6M 50.0% 40.0% 30.0% 20.0% 10.0% 0.0% Oper. Oper Exp Capital Debt Self Ins Rev Outlays Service Outlays Various detail information can be found in this report. Below is a descriptive summary of these activities through March 31st: a) Most major expense categories are anticipated to be at or below budget. b) Total revenues are at 66.5 percent of the $439.3 million budget. Except for IRWD Intra District Sewer Use, IRWD Capital Assessments, Interest Earnings, CNG Sales, and Other Revenues, most major revenue sources are currently tracking close to or exceeding revenue estimates. Overall, total revenues are projected to exceed budget at year-end. More detailed information on District revenues is provided within Section 1 — Pages 3 through 5. Page 1 FY 2017-18 Third Quarter Report c) Collection, Treatment and Disposal Costs: As indicated within the Consolidated Financial Reports Section of this report, the net operating requirements through the third quarter of $107.9 million is currently tracking at 71.1 percent of the $151.9 million budget. In addition, net operating expenses have increased $7.4 million or 7.3 percent in comparison with the same period last year. Overall, staff expects the total operating costs to remain within budget throughout the remainder of the year. More detailed information on District operating expenses is provided within Section 1- Pages 1 through 3. The total cost per million gallons is $2,130 based on flows of 185.0 million gallons per day. This is $120.5 per million gallons, or 5.4 percent lower than the budgeted cost per million gallons per day. A further description of these costs and benchmarking with other agencies is contained within Section 1 — Pages 6 through 8. d) The total projected capital outlay cash flow of the Capital Improvement Program (CIP) for FY 2017-18 has been revised to $124.3 million, or 78.2 percent of the board approved cash outlay of$159.1 million. The actual cash outlay spending through the third quarter is $86.6 million, or 54.4 percent of the total budgeted outlay. More detailed information on the CIP budget review can be found in Section 3. • Quarterly Treasurer's Report This section reports on financial portfolio performance with respect to the Sanitation District's funds. Both Long-Term and Liquid Operating Monies Portfolios are summarized. A performance summary table can be found on page 2 of this section. The report also contains information on the national economic outlook from the Sanitation District's money manager, Chandler Asset Management (Chandler). Chandler notes that although the Long-Term Portfolio quarterly return was negative, the negative return of 33 basis points still outperformed the Bank of America Merrill Lynch 1-5 year AAA-A U.S. Corporate and Government Index negative return of 45 basis points, while the Liquid Operating Monies Portfolio quarterly return matched the three-month Treasury Bill index return benchmark of 35 basis points. Chandler further notes the Federal Open Market Committee (FOMC) raised the Fed funds target rate to a range of 1.50%-1.75% at the March 21 meeting, as expected. The vote was unanimous. In the policy statement, the Fed said economic activity has been "rising at a moderate rate" which was somewhat less bullish than the "solid rate' of growth cited in the January statement. Household and business fixed investment moderated from the fourth quarter. Inflation for items other than food and energy continues to run below 2.0% but the Fed expects inflation to move up in the coming months. The FOMC left its median Fed funds rate forecast unchanged for 2018 at 2.1% which implies two more rate hikes by year-end. Although the forecasted median Fed funds rate for 2018 did not change, Page 2 Executive Summary the dot plot did change with 13 out of 15 FOMC members forecasting two or more rate hikes this year, compared with 10 out of 16 members at the December 2017 meeting. The Fed funds rate targets for 2019 and beyond were revised up slightly. By the end of 2020, the FOMC's median forecast now calls for a Fed funds rate of 3.4%. Overall, the Fed revised their GDP forecasts up slightly, their unemployment forecasts down slightly, and left their inflation projections mostly unchanged. We are forecasting GDP growth of about 2.5%-3.0% in 2018, which is in line with the Fed's forecast and the market consensus. This would equate to an increase over 2017 GDP growth of 2.3%. Overall, economic data remains solid, with the exception of still-sluggish inflation readings. The economy is at or near full employment, consumer confidence is strong, and leading indicators suggest the economy will continue to grow. The Treasury yield curve flattened in March. The 2-year Treasury yield increased slightly to 2.27% from 2.25%, while the 10-year Treasury yield decreased about 12 basis points to 2.86%. At month end, the spread between 2- and 10-year Treasury yields was just 47 basis points; quite flat by historical standards. All else being equal, we believe the Fed's plan to normalize the balance sheet will help promote a steeper yield curve later this year. Tax reform and stronger economic growth may also help drive yields at the long end of the curve higher. However, we believe this is somewhat offset by anticipated ongoing monetary policy normalization by the Fed. Year-over-year, shorter-term Treasury yields have increased more than longer- term Treasury yields. The increase in shorter-term rates has been driven by the Federal Reserve's steady increases in the target Fed funds rate. Meanwhile, longer-term rates (which are more closely tied to inflation expectations and the outlook for economic growth) have remained relatively contained. The Consumer Price Index (CPI) was up 2.4% year-over-year in March, up from 2.2% in February. Core CPI (CPI less food and energy) was up 2.1% year-over- year in March, up from 1.8% in February. The Personal Consumption Expenditures (PCE) index was up 1.8% year-over-year in February versus 1.7% in January. Core PCE (excluding food and energy) was up 1.6% on a year-over-year basis in February versus 1.5% in January. Economic Outlook The fundamental backdrop of the domestic economy remains solid as GDP growth accelerated in the second half of 2017; fourth quarter GDP came in at 2.9% compared to 1.8% in the fourth quarter of 2016. The unemployment rate remains low at 4.1% and non-farm payrolls are robust with the most recent three month and six month moving averages coming in at 202k and 211k through March 2018, respectively. Core inflation has been ticking modestly higher, but importantly the Core PCE on a year-over-year basis remains below the Federal Reserve's 2.0% target, with the most recent reading at 1.6%. The Chandler team is keeping a close eye on wage inflation. Given the aforementioned low unemployment rate the inability of wage inflation on to accelerate comfortably into the 3.25-3.50% range on a year-over-year basis is an anomaly. Changing demographic trends and a still Page 3 FY 2017-18 Third Quarter Report elevated U-6 unemployment rate (8.0% most recently) are contributing factors to the benign wage inflation numbers. Looking out over the next six to twelve months the risk of a recession in the United States is low. Risk assets, on the other hand, experienced heightened volatility and negative price action in the latter two months of the quarter. The magnitude of the price changes on the equity side from a price perspective felt very significant, but on percentage terms less so. The earnings backdrop for US corporations is positive, however there is a growing concern market participants had become too complacent. Throughout 2017 risk markets shrugged off the negative news; the S&P 500 Equity Index moved higher in eleven of twelve months of 2017. The beginning of 2018 started out very strong, but as interest rates moved higher and the lack of continuity in the Trump administration received additional focus, risk assets experienced negative price action. Investors are also processing the implications of global monetary policy turning less accommodative, with the Federal Reserve leading the way in gradually removing accommodation. The annual rotation of voting Federal Reserve Bank Presidents took place in January and Jerome Powell was swom in as the new Fed Chair on February 5th. Historically Powell's voting record is consistent with the prior Chair, Janet Yellen, and market participants are not forecasting a significant change at the Fed related to the new leadership. Monetary policy continued to gradually normalize during the quarter with the Federal Open Market Committee (FOMC) raising the Federal funds rate by 25 basis points to a range of 1.50% to 1.75% at the March 21 meeting. The FOMC also continued the balance sheet normalization program, currently at $20 billion per month ($12 billion in Treasury securities and $8 billion in mortgage backed and agency securities), which is set to increase $30 billion per month in April 2018. The market has thus far absorbed the reduction in the Federal Reserve's balance sheet quite well, however the Chandler team expects the term premium in the Treasury market to ultimately be pressured due to both the greater velocity of balance sheet reduction later in the year and the increased amount of Treasury issuance due to the recently enacted tax reform bill. Similar to the prior quarter, interest rates moved higher across all maturities, with shorter maturity notes continue to lead the way as the Treasury curve continued to experience a flattening bias. Two year Treasury notes increased by 38 basis points to end the quarter at 2.27% and Ten year Treasury notes increased by 33 basis points to end the quarter at 2.74%. Spreads in the investment grade fixed income market also came under pressure partially correlated with the negative price action in equity markets. New issue volume was elevated in January but tailed off in February and March, compared to the prior year, as the negative price action in risk assets kept issuers on the sidelines. • Quarterly Certificates of Participation (COP) Report The report includes a summary of each outstanding debt issuance and a comparative chart illustrating the COP rate history. Page 4 Consolidated Financial Reports Third Quarter Financial Report March 31, 2018 Financial Management is pleased to present the FY 2017-18 third quarter financial report. This report provides a comprehensive overview of the financial condition of the Sanitation District and reports on the status of all capital projects in progress. A summary of the sections contained within this report is provided below. Operating Budget Review., This section reports on collection, treatment and disposal net operating requirements. At March 31, 2018, 71.1 percent, or $107.9 million of the FY 2017-18 net operating budget of $151.9 million has been expended. Net operating expenses increased from the same period last year by $7.4 million, or 7.3 percent, mainly due to an increase of $2.5 million in Repairs and Maintenance, $2.1 million in Salaries and Benefits, $990,000 in Operating Materials and Supplies, $794,000 in Other Operating Supplies, $656,000 in Utilities, $559,000 in Professional Services, $412,000 in Administrative Expenses, $81,000 in Printing and Publication Expenses, $54,000 in Other Non-Operating Expenses, and $48,000 in Research and Monitoring, partially offset by a decrease of $70,000 in Training and Meetings and an increase of $765,000 in indirect costs allocated out to capital projects. These and other variances that factor into this net increase in expenses are discussed in more detail below. Overall, staff expects the total operating costs to remain at or slightly below budget throughout the remainder of the year. Significant operating results as of March 31, 2018 include the following: • Salaries. Wages and Benefits — Personnel costs of$68.7 million are on target at 73.6 percent of budget through the third quarter of FY 2017-18. Although the budget is based on a 5 percent vacancy factor, staffing is 41 full-time equivalents (FTE's), or 6.5 percent below the total 635 FTE's approved in the FY 2017-18 budget. Salary and benefit costs are $2.1 million or 3.1 percent higher than the $66.6 million incurred in the same period last year, mainly due to an increase of$2.2 million in salaries and wages resulting from additional budgeted FTE's of 8 or 1.3 percent, and cost of living adjustments included in the current Memorandums of Understanding for all employee bargaining units. Net operating personnel costs are expected to approximate budget throughout the remainder of the year. • Administrative Expenses — Administrative Expenses totaled $1.6 million, or 77.0 percent of the $2.0 million budget through March 31. These costs are $412,000 or 35.9 percent higher at March 31 in comparison with the prior year mainly due to increases of $261,000 in postage for mailing Prop 218 sewer rate notifications, $85,000 in minor furniture and fixtures for workstation installations and ergonomic chairs, $45,000 in memberships attributable to timing of payments, and $27,000 in purchases of small computer items including tablets and two-way radios. It is anticipated that the administrative costs will approximate budget at year-end. Section 1 - Page 1 FY 2017-18 Third Quarter Report • Printing and Publication Expenses — Printing and Publication Expenses totaled $271,000, or 67.0 percent of the $404,000 budget through March 31. These costs are $81,000 or 42.6 percent higher at March 31 in comparison with the prior year mainly due to an increase of $66,000 in outside printing services, primarily to print Prop 218 notifications for regional sewer service fees, and $11,000 in notices and ads for more job postings to advertise open positions throughout the District. Printing and publication costs are expected to be below budget at year-end. • Training and Meetings — Training and meetings of $554,000 are below target at 44.2 percent of the $1.3 million budget. This account is lower than the proportionate budget due to the timing and need for training throughout the year. These costs have decreased over the same period last year by $70,000 or 11.2 percent, primarily as a result of Total Productive Maintenance Certification Program costs incurred in the prior period. Total training and meeting costs are anticipated to be below budget at year-end. • Operating Materials and Supplies — Operating materials and supplies of $12.0 million is on target at 76.2 percent of the $15.7 million budget through March 31. Operating Materials and Supplies are higher than the prior year by $990,000 or 9.0 percent, primarily due to increases in Odor Control of $513,000, Chemical Coagulants of $251,000, and Safety Equipment of $156,000. The increases are mainly brought about by the proactive treatment of odor control chemicals in the trunk lines as outlined in the odor control action plan, as well as higher chemical unit costs and additional purchases of safety equipment and tools from the prior year. Based on current processes, operating materials and supplies are anticipated to approximate budget at year-end. • Contractual Services — Contractual services is on target at $17.3 million or 70.8 percent of the $24.5 million budget through March 31. Contractual Services is higher by $9,000 or 0.1 percent over the same period last year. Solids Removal costs, budgeted at $15.9 million, comprise the majority of this expense category, and decreased $997,000 or 7.8 percent from the prior year primarily due to the renegotiation of composting contract rates. Solids removal costs totaled $11.8 million, or 74.1 percent of budget at March 31. Temporary Services increased by $739,000 because of position vacancies and Security Services rose by $366,000 as a consequence of heighted security and the addition of armed patrol services at both plants. These increases were offset by a decrease of $70,000 in Other Waste Disposal attributable to a reduction in removal of hazardous waste materials from the same period last year and a decrease in Other Contractual Services of $43,000. County Service Fees totaled only $44,000, or 6.7 percent of the $659,000 budget through the third quarter as the preponderance of these fees are billed by the County in the fourth quarter. Total contractual services costs are anticipated to approximate budget at year-end. • Professional Services — Professional services costs totaled $2.8 million or 54.4 percent of the $5.1 million budget through March 31. Professional service costs, such as Audit and Accounting, Engineering, Environmental Scientific Consulting, Section 1 - Page 2 Consolidated Financial Reports Software Program Consulting, and Other Services, are proportionately low through March 31 due to a variety of factors such as timing of services and re-evaluation of needs for services. These costs are $559,000 or 25.1 percent higher at March 31 in comparison with the prior year, mainly attributable to increases of $397,000 in Engineering as a result of additional engineering services for the Civil Assets Management Program (CAMP) and $134,000 in Legal costs due to additional legal support services incurred. It is anticipated that the costs for this category will be below budget at year-end. • Research and Monitoring — Research and monitoring costs totaled $573,000, or 64.4 percent of the $889,000 budget through March 31. These costs are $48,000, or 9.2 percent higher at March 31 in comparison with the prior year, mainly due to an increase in Environmental Monitoring costs such as vessel services and regional ocean monitoring. Total research and monitoring costs are anticipated to be below budget at year-end. • Repairs and Maintenance — Repair and maintenance costs totaled $12.0 million, or 75.5 percent of the $15.9 million budget through March 31. These costs are $2.5 million, or 26.4 percent higher at March 31 in comparison with the prior year, mainly due to additional repair materials purchased, such as engine components to remedy gas leaks, and an increase in service maintenance agreements resulting from timing of payments. It is anticipated that the costs for this category will approximate budget at year-end. • Utilities — Utilities costs totaled $5.3 million, or 67.6 percent of the $7.9 million budget through March 31. These costs are $656,000 or 14.0 percent higher at March 31 in comparison with the prior year, primarily due to an increase of$549,000 in power charges as a result of higher electricity rates, increased consumption from facility-related demand, and a Plant 2 CenGen shutdown. Telephone costs rose by $105,000 because of Internet upgrades and additional cell phones to improve field staff communication abilities. It is anticipated that the costs will be slightly below budget at year-end. • Other Operating Supplies — Other operating supplies costs totaled $2.6 million, or 79.1 percent of the $3.3 million budget through March 31. Property and General Liability Insurance, budgeted at $2.1 million, comprise the majority of this expense category at $1.6 million. These costs are $750,000 or 90.0 percent higher at March 31 in comparison with the prior year primarily due to an increase in budgeted in-lieu premium charges in order to maintain recommended reserve balances. It is anticipated that other operating supplies costs will approximate budget at year-end. • Revenues — Service Fees and Property Taxes — Through March 31, revenues from service fees are at $190.7 million, or 65.5 percent of budget and property taxes are at $63.3 million, or 67.5 percent of budget. These items comprise the majority of the Sanitation District's revenues and are mostly collected by the County through the property tax roll and distributed to the Sanitation District throughout the Section 1 - Page 3 FY 2017-18 Third Quarter Report year based on a set distribution schedule that begins in November of each year. An increase of $11.3 million or 6.3 percent in service fee revenue over the prior period is due in part to higher sewer service rates, timing of receipts, and a decrease in user fee rebates issued in the current period, partially offset by the transfer of local sewer service fees to East Orange County Water District. An increase of$8.0 million or 14.4 percent in property tax revenues over the prior period is a result of a rise in assessed property values and timing of receipts. These revenues are expected to approximate budget at year-end. • Revenues — Permittee User Fees — Permittee User Fees are at $13.6 million, or 105.0 percent of the $12.9 million budget. The revenues through the third quarter are higher than the same period last year by $4.0 million or 41.8 percent due to higher rates and an increase in the strength of the discharge from the permittees. The number of permittees fluctuates from year to year as businesses are established or close their operations. Permit user fees revenues are expected to exceed budget at year-end. • Revenues — Inter District Sewer Use — SAWPA and SBSD — Inter District Sewer revenues - SAWPA and SBSD are at $2.1 million, or 64.6 percent of the $3.3 million budget. This revenue is derived from charges to the Santa Ana Watershed Protection Agency (SAWPA) and Sunset Beach Sanitary District (SBSD) for treatment of flows. The revenues through the third quarter are lower than the same period last year by $304,000 or 12.6 percent due to a decrease in flows received from these agencies and a resulting reduction in operation and maintenance charges. These revenues are expected to be below budget at year-end. • Revenues — Intra District Sewer Use — IRWD — Intra District Sewer revenues- IRWD are at $1.6 million, or 35.6 percent of the $4.6 million budget. This revenue is derived from charges to the Irvine Ranch Water District (IRWD) for treatment of flows. The revenues through the third quarter are higher than the same period last year by $5.3 million or 144.6 percent, mainly due to a prior year reduction of $6.1 million in pension costs allocated to IRWD as a result of changes to the amortization period of IRWD's proportionate share of the $214.1 million unfunded actuarial liability paydowns made by the District to the Orange County Employees Retirement System, offset by a decrease of $633,000 in operation and maintenance charges to IRWD, primarily due to a reduction in flows received from this agency. These revenues are expected to be below budget at year-end. • Revenues - Sludge Disposal — IRWD — Sludge Disposal fees - IRWD are at $3.4 million, or 58.3 percent of the $5.9 million budget. The revenue is for the handling, treatment and disposal of solids, derived from flows discharged from IRWD to the Sanitation District. The revenues through the third quarter are lower than the same period last year by $8.1 million or 70.3 percent, mainly due to actual cost adjustments as a result of a two-year annual reconciliation and a decreased solids flow received from IRWD. The current fiscal year quarterly billing to IRWD is based on estimates. It is estimated that IRWD sludge disposal revenues will be below budget at year-end. Section 1 - Page 4 Consolidated Financial Reports • Revenues — Capital Assessments — IRWD — Capital Assessments-IRWD are at $2.5 million, or 45.8 percent of the $5.4 million budget. The revenues through the third quarter are higher than the same period last year by $747,000 or 43.6 percent mainly due to an increase in joint capital costs allocable to IRWD. It is estimated that IRWD capital assessments revenues will be below budget at year-end. • Revenues — Capital Facilities Capacity Charges (CFCC) — CFCC are at $11.4 million, or 114.9 percent of the $9.9 million budget. The revenues through the third quarter are higher than the same period last year by $3.3 million or 40.5 percent due to an increase in rates and connection fees collected from cities as well as more supplemental capital facilities capacity charges assessed to industrial dischargers than at this time last year. These revenues are expected to exceed the budget at year-end. • Revenues — Interest Earnings — Interest Earnings are at $884,000 or 10.5 percent of the $8.4 million budget. The revenues through the third quarter are lower than the same period last year by $659,000 or 42.7 percent due to lower yields earned on securities held in the investment portfolios. It is estimated that the interest earnings will be below the budget amount at year-end. • Revenues — CIP Reimbursements — CIP Reimbursements are at $1.6 million or 74.3 percent of the $2.1 million budget. These revenues consist of reimbursements for construction projects received from the Orange County Water District for P2-122 Headworks Modifications at Plant 2 for GWRS Final Expansion and the cities of Fullerton and Anaheim for 2-72B Newhope-Placentia Trunk Replacement, Segment B. No reimbursements were received for these projects during the same period last year. These revenues are expected to approximate budget at year-end. • Revenues — Wastehauler — Wastehauler revenues are at $489,000 or 61.1 percent of the $800,000 budget. This revenue is derived from fees charged to wastehaulers allowing them to dump waste into the Sanitation District's system. The revenues through the third quarter are lower than the same period last year by $228,000 or 31.8 percent due to a reduction in waste dumping. These revenues are expected to approximate budget at year-end. • Revenues — CNG Sales — CNG Sales revenues are at $114,000 or 27.1 percent of the $420,000 budget. This revenue is derived from public sales at the District's Compressed Natural Gas (CNG) fueling station. The revenues through the third quarter are lower than the same period last year by $218,000 or 65.7 percent due to mechanical failures of the public CNG fueling station that resulted in the station being of0ine for several months. These revenues are expected to be below budget at year-end. Section 1 - Page 5 FY 2017-18 Third Quarter Report Comparison of Third Quarter Cost per Million Gallon Results with Budget Last Five Years $2.300 $2,250 $2.200 $2.150 $2.100 $2.050 sz m $2.000 # $1.950 $1.900 $1.850 $1.800 $1,750 $1.700 $1.650 $1.600 $1,550 $1.500 1314 1" 15.15 1617 17-16 3rd Annual 3rd Annual 3rd Annual 3rd Annual 3rd Annual atr Budget atr Budget Qtr Budget Qtr Budget Qtr Budget As demonstrated in the preceding graph for each of the last four fiscal years, the cost per million gallons at the end of the third quarter has been between 1.2 percent higher to 10.0 percent lower than the annual budget. The FY 2017-18 third quarter cost per million gallons of $2,130 is 5.4 percent lower when compared with this year's budget. The increase in cost per million gallons of $179 from the previous year is primarily due to an increase in operating expenses, which are 7.3 percent higher than the same period last year and a decrease in flows, which are 1.7 percent lower than the same period last year. Staff believes that overall operating costs will be below budget at year- end. The total cost per million gallons at March 31 is $2,130 based on flows of 185 million gallons per day. This is $120 per million gallons, or 5.4 percent, lower than the budgeted cost per million gallons of $2,250. There is an inverse relationship between the amount of flows and the cost per unit of collection, treatment, and disposal. Consequently, the lower cost per million gallons is due to net expenses being 5.3 percent less than the proportionate budget through March 31 with flows of 185.0 million gallons per day being equal to the budgeted flow of 185 million gallons per day. More detailed information on operating revenues, costs, and related information is provided within Section 2. Section 1 - Page 6 Consolidated Financial Reports Following are data tables showing the last five years of Single Family Residential User Fees (SFR) and the cost per MG to collect, treat, and dispose of wastewater for OCSD and for similar agencies. The agencies used in the table were determined to be those that most closely resembled OCSD in terms of services provided and treatment levels. The summaries demonstrate that OCSD's SFR and cost per million gallons are each one of the lowest in their respective group. Benchmark Study Five-Year Single Family Residential Rate Rates as of July 2013 2014 2015 2016 2017 Agency SFR SFR SFR SFR SFR Noles San Francisco $ 701 $ 745 $ 784 $ B42 $ 937 City of San Diego $ 573 $ 573 $ 573 $ 573 $ 573 Note 5 Central Contra Costa Sanitary District $ 405 $ 439 $ 471 $ 503 $ 530 City of Los Angeles $ 409 $ 435 $ 464 $ 495 $ 527 Note 1 Vallejo Sanitation/Flood Control District $ 507 $ 520 $ 520 $ 520 $ 520 Sacramento County $ 312 $ 348 $ 384 $ 420 $ 432 Dublin San Raman Services District $ 355 $ 373 $ 382 $ 382 $ 397 Union Sanitary District $ 338 $ 357 $ 377 $ 380 $ 393 East Bay MUD $ 331 $ 358 $ 355 $ 373 $ 391 City of Hayward $ 327 $ 337 $ 347 $ 358 $ 375 Orange County Sanitation District $ 308 $ 316 $ 322 $ 327 $ 331 City of Fresno $ 309 $ 309 $ 309 $ 309 $ 309 Note 4 Irvine Ranch Water District $ 221 $ 246 $ 289 $ 309 $ 309 Note 2 Oro Loma Sanitary District $ 195 $ 200 $ 206 $ 221 $ 238 Los Angeles County $ 150 $ 151 $ 155 $ 159 $ 163 Note 3 Notes: (1)- Data is for the typical SFR customer rate. (2)- Data represents the usage of 10 hundred cubic feet per unit. (3)- Data for 2013 and 2014 has been revised to remove ad valorem monies that were inadvertently include (4)- Data represents the minimum SFR rate not including flow. (5)- Data represents the base sewer fee plus the average usage of 9 hundred cubic feet per month. Section 1 - Page 7 FY 2017-18 Third Quarter Report Benchmark Study Five-Year Cost per MG FY 12-13 FY 13-14 FY 14-15 FY 15-16 FY 16-17 Agency Svc.Trt. Cost/MG CosYMG Cost/MG Cost/MG CostIMG Notes Central Contra Costa Sanitary District B 4 $ 4,622 $ 5,778 $ 6,281 $ 6,454 $ 6,081 San Francisco B 3 $ 5,007 $ 5,400 $ 5,358 $ 5,268 $ 4,916 Note 1 Vallejo Sanitation/Flood Control District B 3 $ 5,435 $ 6,153 $ 5,590 $ 5,396 $ 4,745 Union Sanitary District B 3 $ 3,805 $ 3,832 $ 3,911 $ 3,957 $ 4,039 City of San Diego B 4 $ 3,340 $ 3,156 $ 3,592 $ 3,606 $ 3,834 Dublin San Ramon Services District B 4 $ 2,159 $ 2,507 $ 2,522 $ 2,896 $ 2,961 Sacramento County T 4 $ 2,143 $ 2,375 $ 2,494 $ 2,571 $ 2,752 Note 2 City of Los Angeles B 4 $ 2,062 $ 2,163 $ 2,269 $ 2,452 $ 2,487 East Bay MUD T 3 $ 2,359 $ 2,559 $ 2,728 $ 2,599 $ 2,353 Orange County Sanitation District B 3 $ 1,906 $ 1,935 $ 2,071 $ 2,110 $ 2,055 City of Fresno B 3 $ 1,412 $ 1,552 $ 1,629 $ 1,678 $ 1,796 Los Angeles County B 4 $ 1,008 $ 1,224 $ 1,239 $ 1,371 $ 1,151 Note 3 Legend for Service Provided and Treatment Level: B-Agency operates both collection and treatment facilities T-Agency provides treatment services but not collection 3-Secondary treatment 4-Advanced secondary or secondary with some tertiary treatment Notes: (1)-Beginning in Fiscal Year 2012-13,dataset represents wastewater finis from finalized publicly available audited documents. (2)-Mles of sewers number changed in 2012 to include parallel face main pipes par the 2011 State of the District Report. (3)-Does not include source control or overhead costs. Section 1 - Page 8 Consolidated Financial Reports Capital Outlay Review: $200,000,000 $150,000,000 $100,000,000 $50,000,000 $0 3/31118 Actual Projected 2017-18 2017-18 Capital Outlay Capital Outlay Capital Outlay Cashfiow Budget $86,570,595 $124,333,700 $159,060,657 As depicted by the preceding chart, Capital Outlays totaled $86.6 million or 54.4 percent of the capital outlay cash flow budget for FY 2017-18 as of March 31, 2018. Costs are proportionately low through the third quarter as some projects are still in the design phase or have experienced various delays or deferrals. Examples as of March 31 are Safety Improvements at Plants Nos. 1 and 2, which has a budget of$10.0 million but actual costs of only $1.5 million and Rehabilitation of Western Regional Sewers, which has a budget of $9.5 million but actual costs of only $1.8 million. Overall, the capital outlay costs of the capital improvement program are expected to approximate $124.3 million, or 78.2 percent of the capital outlay cash flow budget at year-end. More detailed information on the capital improvement program is provided within Section 3. Capital Assets Schedule and Debt Service Budget Review: Section 4 is the Capital Assets Schedule and Debt Service Section. This section shows the cost value of the Sanitation District's capital facilities at March 31, 2018, as well as the debt service costs resulting from the need to provide funding for the construction of capital facilities. The majority of principal payments on debt issues are due in August during the first quarter, and in February during the third quarter of each fiscal year. As of March 31, 2018, 81.2 percent of the principal payments have been made through the end of the third quarter, due to Revenue Refunding Certificate Anticipation Notes Series 2016B to be refunded in December 2018. Total principal payments are expected to be below Section 1 - Page 9 FY 2017-18 Third Quarter Report budget at year-end. Interest costs are expensed ratably throughout the fiscal year. Interest expense is anticipated to approximate budget at year-end. Self-Insurance Budget Reviews: Section 5 is the Self-Insurance Section. Through March 31, the Self-Insurance Fund revenues totaled $2.0 million or 74.9 percent of the budget, while expenses were $1.5 million or 63.3 percent of the budget. Separate fund accounting is used for recording the revenue and expenses incurred in managing these liability claims. The revenues to these funds represent charges to operating divisions. Expenses to these funds include actual claims paid, claims administration, and excess loss policies. Section 1 - Page 10 Operating Budget Review Cost per Million Gallons by Department Budget and Actual March 31, 2018 $1,500 $1,400 $1,300 $1,200 $1,100 $1,000 $900 $800 $700 $500 $500 $400 5300 az00 $100 $0 el 'uw Z8 � N j �eutlget �Aclual Collection, Treatment, & Disposal Expenses by Major Category Budget and Actual (in thousands) March 31,2018 $75,000 $70,000 M'000 $00,000 $55,000 $W,000 U5,000 U0,000 $35,000 $30.000 $25,000 $20.000 $15.000 $10,000 $5,000 $o Eu o' 2 8 Meuaeac Nnmai Section 2-Page 1 2017-18 Third Quarter Report Divisional Contributions to Cost Per Million Gallons For the Nine Months Ended March 31,2018 2017-18 3131116 3131117 Annual 3131119 Actual Actual Budget Actual Flow in Million Gallons 50,512.69 51,544.05 67525.00 50,691.86 Flow In Million Gallons per Day 183.68 188.12 185.00 185.00 Executive Management Department General Management Administration $ 30.72 $ 33.41 $ 43.12 $ 34.33 Board Services 7.44 8.08 8.92 9.30 Public Affairs 13.09 14.86 16.42 15.18 Subtotal 51.25 56.35 68.46 58.81 Human Resources Department Human Resources 56.43 50.33 59.81 56.99 Risk Management/Safety l Security 45.35 60.10 95.17 83.97 Subtotal 101.78 110.43 154.98 140.96 Administrative Services Department Administrative Services 8S5 7.36 US T.27 Financial Management 47.50 42.21 56.78 5&W Contacts,Purchasing,&Materials Mgmt. 62.97 61.91 65.49 6T.26 Information Technology 148.83 139.12 156.51 15 L81 Subtotal 267.95 250.60 288.03 262.72 Facilities Support Services Department Facilities Support Administration 16.86 - - - Facilities Support 31.16 - - - Collections Engineering 40.00 - - - NPDES Source Inspection 34.45 - - - Odor and Corrosion Control 98.08 - - - Collection Facilities O&M 56.85 Subtotal 277.40 Environmental Services Department Environmental Services Administration - 11.86 12.23 12.70 Resource Protection - 79.23 85.27 81.92 Laboratory,Monitoring and Compliance 160.62 158.87 159.17 Subtotal 241.71 256.37 253.79 Engineering Department Engineering Administration T.17 6.45 6.49 7.25 Planning 50.28 48.48 46.78 47.03 Project Management Office 36.85 39.58 42.49 37.12 Civil and Mechanical Engineering 141.09 123.56 127.80 124.40 Electrical&Control System Engineering - 61.08 77.54 69.64 Environmental Compliance 9&08 Subtotal 333.47 279.15 301.10 285.44 Operations&Maintenance Department Operations&Maintenance Administration 13.11 6.88 10.89 8.46 Collections Facilities 0&M - 167.47 181.93 191.85 Fleet Services - 29.12 29.10 29.02 Plant No. 1 Operations 485.55 374.65 412.69 382.93 Plant No.20perations 301.91 304.97 287.14 295.68 Plant No. 1 Maintenance 233.22 228.67 216.64 227.12 Maintenance Reliability and Planning - 23.11 114.03 100.99 Plant No.2 Maintenance 167.78 171.25 215.45 184.88 Environmental Laboratory&Ocean Monitoring 12018 Subtotal 1,321.75 1,306.12 1,467.87 1,420.93 Total Operating Expenses 2,353.60 2,244.36 2,536.81 2,442.65 Cost Allocation (285.03) (293.11) (286.81) (313.15) Net Operating Requirements $ 2,068.57 $ 1,9 11.25 $ 2,2 00.00 $ 2,129.50 Section 2-Page 2 Operating Budget Review Comparison of Expenses by Department For the Nine Months Ended March 31,2018 2017-18 M1116 U31117 Year to Date Budget% Department and Division Actual Actual Budget W31/18 Realized Executive Management Department General Management Administration $ 1,551,933 $ 1,721,995 $ 2.911,810 $ 1,740,416 59.77% Board Services 375,805 416,378 602,340 471,458 78.27% Public Affairs 661,151 766,109 11108,900 769,519 69.39% Subtotal 2,588.889 2.904,482 4.623,050 2,981.393 64,49% Human Resources Department Human Resources 2,850.633 2.594,345 4.038,470 2,889.181 71,54% Risk Management/Safety/Security 2,290,593 3,097,847 6,426,070 4,256,740 66.24% Subtotal 5,141.226 5.692,192 10.464,540 7,145.921 68,29% Administrative Services Department Administrative Services 436,875 379,381 624,730 368,6W 59.00% Financial Management 2,399,205 2,175,718 3,833,990 2,705,945 70.58% Contracts,Purchasing,&Materials Mgmt. 3,180,634 3,191,115 4,422,300 3,409,316 77,09% Information Technology 7,517,576 7.170,618 10.568,540 7,847,646 74.25% subtotal 13,534,290 12,916,832 19,449,560 14,331,514 73.69% Facilities Support Services Department Facilities Support Administration 851,413 - - - 0,00% Facilities Support 1,573,934 - - - 0.00% Collections Engineering 2,020,418 - - - 0.00% NPDES Source Inspection 1,739,984 - - - 0.00% Odor and Corrosion Control 4,954,267 - - - 0,00% Collection Facilities 0&M 2,871,400 0.00% subtotal 14,011,416 - - - 0.00% Environmental Services Department Environmental Services Administration - 611,470 825,750 643,868 77.97% Resource Protection - 4,083,835 5,758,120 4,152,905 72.12% Laboratory,Monitoring and Compliance 7763786 10727,570 8,068.630 75.21% Subtotal 12,459,091 17,311,440 12,865,403 74.320 Engineering Department Engineering Administration 362,398 332,514 438,390 367,659 83.87% Planning 2,539,623 2,499,012 3.158,970 2,383.797 75,46% Project Management Office 1,861,190 2,040,356 2.868,900 1,881,871 65.60% CMI and Mechanical Engineering 7,127,049 6,369,027 8,629,930 6,306,084 73.07% Electrical&Control System Engineering - 3,148,377 5,235,710 3,530,274 67.43% Environmental Compliance 4,954,520 0,00% Subtotal 16,844,780 14,389,286 20,331,900 14,469,685 71.17% Operations&Maintenance Department Operations&Maintenance Administration 662,192 384,662 735,030 428,922 58.35% Collections Facilities 0&M - 8,632,002 12,284,740 9,725,442 79,17% Fleet Services - 1.501,172 1.965,050 1,470.972 74.86% Plant No.1 Operations 24,526,402 19,310,893 27,866,660 19,411,327 69.66% Plant No.2 Operation 15,250,445 15,719,496 19,389,450 14,988,780 77.30% Plant No.1 Maintenance 11,780,439 11,786,631 14,628,280 11,513,281 78,71% Maintenance Reliability and Planning - 1.191,251 7,700,130 5,119,490 66.49% Plant No.2 Maintenance 8,474,898 8,827,127 14,548,410 9,371,662 64.42% Environmental Laboratory&Ocean Monitoring 6,071,382 0.00% Subtotal 66,765,758 67,323,234 99,117,750 72,029,876 72.67% Total Operating Expenses 118,886,359 115,685,117 171,298,240 123,823,792 72.29% Cost Allocation (14,397,165) (15,109,885) (19,394,560) (15,875,284) 81.85% Net Operating Requirements $ 104,489,194 $ 100,575,232 $ 151,903,680 $ 107,948,508 71.06% Section 2-Page 3 2017-18 Third Quarter Report Summary of Collection, Treatment, &Disposal Expenses by Major Category For the Nine Months Ended March 31,2018 Expense Expense Increase Increase Percent Budget Through Through (Decrease) (Decrease) Budget Remaining Description 2017-18 3131/18 3131117 $ % Realized Budget Salary&Wages $ 70,883,000 51,624,181 49,447,575 $2,176,606 4.40% 72.83% $ 19.258,819 Employee Benefits 22,478,330 17,061,665 17,145,625 (83,960) -0.49% 75.90% 5,416,665 Administrative Expenses 2,026,550 1,560.596 1,148,500 412,096 35.88% 77.01% 465,954 Printing&Publication 403,900 270,726 189,860 80,866 42.59% 67.03% 133,174 Training&Meetings 1,252,320 553,735 623,323 (69.588) -11.16% 44.22% 698,585 Operating Materials&Supplies 15,724,300 11,981,594 10,991,904 989,690 9.00% 76.20% 3,742,706 Contractual Services 24,489,090 17,329,278 17,320,602 8,676 0.05% 70.76% 7,159,812 Professional Services 5,125,990 2,786,594 2,228,015 558,579 25.07% 54.36% 2,339,396 Research&Monitoring 889,400 572,801 524,509 48,292 9.21% 64.40% 316,599 Repairs&Maintenance 15,945,110 12,037,858 9,524,542 2,513,316 26.39% 75.50% 3,907,252 Utilities 7,898,590 5,339.810 4,683,734 656,076 14.01% 67.60% 2,558,780 Other Materials,Supplies, and Services 4,181,660 2,704,954 1,856,928 848,026 45.67% 64.69% 1,476,706 Net Cost Allocation (19,394,560) (15,875,2114) (15,109,885) (765,399) 5.07% 81.85% (3,519,276) Net Operating Requirements 151,903,680 107,948,508 100,675,232 7,373,276 7.33% 71.06% 43,955,172 Gallonage Flow(MG) 67,525.00 50,691.86 51,544.05 (852.19) -1.65% Gallonage Flow(MGD) 185.00 185.00 188.12 (3.12) -1.66% Gallonage Flow($'a/MG) $2,250000 $2,129.50 $1,951.25 $178.25 9.14% Section 2-Page 4 Operating Budget Review Summary of Revenues For the Nine Months Ended March 31, 2018 Revenue Percent Revenue Increase Increase Budget Through Budget Remaining Through (Decrease) (Decrease) Description 2017-18 3131/18 Realized Budget 3/31/17 $ % Service Fees $291,158,000 $190,727,130 65.51% $100,430,870 $179,469,176 $ 11,257,954 6.27% Permit Fees 12,925,000 13,576,234 105.04% (651,234) 9,576,898 3,999,336 41.76% Inter District Sewer Use-SAWPA&SBSD 3,263,000 2,109,249 64.64% 1,153,751 2,413,258 (304,009) -12.60% Inter District Sewer Use-IRWD 4,552,800 1,622,381 35.63% 2,930,419 (3,640,415) 5,262,796 144.57% Sludge Disposal-IRWD 5,880,000 3,425,171 58.25% 2A54,829 11,516,699 (8,091,528) -70.26% Capital Assessments-IRWD 5,375,000 2,459,944 45.77% 2,915,056 1,712,992 746,952 43.61% Capital Facilities Capacity Charges 9,900,000 11,375,481 114.90% (1,475,481) 8,094,689 3,280,792 40.53% Debt Proceeds - - N/A - 195,083,269 (195,083,269) -100.00% Property Taxes 93,666,000 63,263,299 67,54% 30,402,701 55,307,967 7,955,332 14.38% Interest Earnings 8,398,000 884,423 10.53% 7,513,577 1,543,527 (659,104) 42.70% CIP Reimbursements 2,130,000 1,583,532 74.34% 546,468 - 1,583,532 N/A Wastehauler 800,000 488,944 61A2% 311,056 716,662 (227,718) -31.77% CNG Sales 420,000 113,952 27.13% 306,048 331,711 (217,759) -65.65% Rents&Leases 255,000 351,517 137.85% (96,517) 194,238 157,279 80.97% Other Revenues 475,000 210,660 44.35% 264,340 269,604 (58,944) -21.86% Power Sales 30,000 22,532 75.11% 7,468 37,555 (15,023) 40.00% Other Sales 45,000 67,212 149.36% (22,212) 48,875 18,337 37.52% Total Revenues $439,272,800 $292,281,661 66.54% $146,991,139 $462,676,705 $(170,395,044) -36.83% Section 2-Page 5 2017-18 Third Quarter Report Summary of Collection,Treatment, &Disposal Expenses by Line Item For the Nine Months Ended March 31, 2018 Expense Percent Expense Increase Increase Budget Through Budget Remaining Through (Decrease) (Decrease) Description 2017-18 Y31118 Expensed Budget 3131/17 $ % Salaries.Wages&Benefits Salaries&Wages $ 70,883,000 $ 51,624,181 72.83% $ 19,258,819 $ 49,447,575 $ 2,176,606 4.40% Employee Benefits Retirement 10,792,800 8,415,343 77.97% 2,3T',457 8,573,349 (158,0N) -1.84% Group Insurances 10,421,800 7,601,652 72.94% 2,820,148 7,102,677 498,975 7.03% Tuition&CertlAcation Relmb 102,000 77,427 75.91% 24,573 80,407 (2,980) -3.71% Ed..degrees,Cart.&Lic. 380,700 360,805 N.TT% 19,895 312,062 48,743 15.62% Uniform Rental 110,600 100,326 90.71% 10,274 87,655 12,671 14.46% Workers'Compensation 554,330 415,749 75.00% 138,581 897,226 (481,477) -53.66% Unemployment Insurance 24,700 22,212 89.93% 2,488 14,048 8,164 58.12% EMT Supplemental BenerRe 91,400 68,151 74.56% 23,249 78,201 (10,050) Total Benefits 22,478,330 17,061,665 75.90% 5,416,665 17,145,625 (83,960) Salaries,Wages&Benefits 93,361,330 68,685,846 73.57% 24,675,484 66,593,200 2,092,61 3.14% Mall.Supply,&Services Administrative Expenses Memberships 615,130 528,568 85.93% 86,562 483,474 45,094 9.33% Office Exp-Supplies 66,220 43,393 65.53% 22,827 45,523 (2,130) 4.68% Postage 320,570 289,384 90.27% 31,186 27,969 261,415 934.66% Books&Publications 41,530 21,310 51.31% 20,220 25,754 (4,444) -17.26% Forms 550 190 34.55% San - 190 N/A Smell Computer Items 750,000 521,811 69.57% 228,189 494,526 27,285 5.52% Minor Furniture&Fixtures 232,550 155,940 67.N% 76,610 71,254 84,686 118485% Subtotal 2,026,550 1,560,596 77.01% 465,954 1,14&500 412,096 35.88% Printing&Publication Repro-In-House 243,960 145,077 59.47% 96,883 141,396 3,681 2.60% Pirm ing-Outside 112,560 75,137 66.75% 37,423 8,925 66,212 741.87% Notices&Ads 47,330 50,168 106.00% (2,838) 39,539 10,629 26.88% Photo Processing 50 3" 688.00% (294) 3" N/A Subtotal 403,900 270,726 6703% 133,174 189,860 80,866 42.59% Training&Meetings Meanings 198,620 75,647 38.09% 122,973 79,N4 (4,337) -5.42% Training 1,053,700 478,088 45.37% 575,612 543,339 (65,251) Subtotal 1,252,320 553,735 44.22% 696,585 623,323 (69,588) -11.16% Operating Mal&Supplies Chemical Coagulants 5,225,000 4,078,872 TB.N% 1,146,128 3,827,411 251,461 6.57% Odor Control 7,494,000 5,656,943 75.49% 1,837,057 5,144,367 512,576 9.96% Disinfection 307,600 137,703 44.TT% 169,897 140,780 (3,077) -2.19% Chemicals-Mist&Cogan 342,000 264,612 77.37% TT,388 224,707 39,905 17.76% Gasoline,Diesel&Oil 565,790 338,316 59.80% 227,474 397,487 (59,171) -14.89% Tools 401,500 299,387 74.57% 102,113 219,384 80,003 36.47% Safety equlpmentitools 517,290 598,523 115.70% (81,233) 442,313 156,210 35.32% Soly,Paine,&Jan.Supplies 91,600 69,803 76.20% 21,797 60,178 9,625 15.99% Lab Chemicals&Supplies 587,160 416,232 70.89% 170,928 416,942 (710) -0.17% Other Operating Supplies 18&360 1N,196 55.32% 84,164 117,304 (13,108) -11.17% Property To.Fees 4,000 17,007 425.18% (13,007) 1,031 15,976 1549.561% Subtutal 15,724,300 111981,594 76.20% 3,742,706 10,991,904 989,690 9.00% Contractual Services Solids Removal 15,900,000 11,789,054 74.14% 4,110,946 12,78$999 (996,945) -9.80% Other West.Disposal 9N1040 538,407 54.38% 451,633 609,058 (70,651) -11.60% Groundskeeping 129,720 122,429 94.N% 7,291 115,145 7,284 6.33% Janitorial 36S440 275,945 75.W% 90,495 269,578 6,367 2.36% Outside Lab Services 2N,MO 110,896 44.36% 139,104 86,156 24,740 28.72% Oxygen 375,000 229703 61.25% 145,297 252,460 (22,757) -9.01% County Service Fee 656,700 43,847 6.66% 614,853 45,213 (1,366) -3.02% Temporary Services 1,637,190 1,193,277 77.63% 343,913 454,756 738,521 162.40% Security Services 1,600,000 1,195,235 74.70% 404,765 828,882 366,353 44.20% Other 2,682,000 1.830,485 68.25% 851,515 1,873,355 (42,870) Subtotal 24,489,090 17,329,278 70.76-A 7,159,812 17,320,602 8,676 0.05% (Continued) Section 2-Page 6 Operating Budget Review Summary of Expenses by Line Item For the Nine Months Ended March 31,2018 Expense Percent Expense Increase Increase Budget Through Budget Remaining Through (Decrease) (Decrease) Description 2017-18 Y31118 Expenses! Budget 3131117 $ % Continued: Processional Services Legal 977,000 1,012,052 103S9% (35,052) 877,711 134,341 1&31% Audit&Accounting 259,300 114,632 44.21% id6,668 72,056 42,576 59.09% Engineering 1,758,0W 756,1W 43.01% 1,001,864 359,471 396,665 110.35% Ervin,Scientific Consulting 150,800 68,843 45.65% 81,957 35,674 33,169 92.98% Software PMm Consulting 416,000 195,024 4&88% 220,976 286,540 (91,516) -31.94% Advocacy Efforts 176,000 120,250 68.32% 55,750 122,620 (2,370) -1.93% Industrial Hygiene Services 50,000 53,342 106.68% (3,342) 45,494 7,848 17.25% Labor Negotiation Services 20,000 - 0.00% 20,000 56,350 (56,350) -100.00% Other 1,318,890 466,315 3&36% 862,575 372,099 94,216 25.32% Subtotal 5,125,990 2,786,594 54.36% 2,339,396 2,228,015 558,579 25.07% Research&Monitoring Environmental Monitoring 369,200 251,326 6&07% 117,874 221,577 29,149 13A3% Air Quality Monitoring 95,200 2,725 2.86% 92,475 2,932 (207) -7.06% Research 425,000 318,750 75.00% 105,250 300,000 18,750 625% Subtotal 889,400 572,801 64.40% 316,599 524,509 48,292 921% Repairs&Maintenance Materials&Services 13,078,200 10,012,012 76.55% 3,066,188 7.866,335 2,145,677 27.28% Svc.Mlc.Agreements 2,866,910 2,025,846 70.66% 841,064 1,658,207 367,639 22.17% Subtotal 15,946,110 12,037,80 ]5.50% 3,907,252 9,524,542 2,513,316 2&39% Utilities Telephone 400,000 341,245 85.31% 58,755 236,305 104,940 44.41% Diesel For Generators 14,290 7,148 50.02% 7,142 4,760 2,398 50A8% Natural Gas 780,500 392,705 50.31% 387,795 404,302 (11,597) -2.87% Purser 6,037,0W 4,156,239 68.85% 1,880,761 3.606,859 549,380 15.23% Water 666,800 442,473 66.36% 224,327 431,510 10,955 2.54% Subtotal 7,898,590 6,339,810 87,60% 2,558,780 4,683,734 656,076 14.01% Other Operating Supplies Outside Equip Rental 107,600 93,219 86.63% 14,301 63,779 29,440 46.16% Insurance Premiums 32,000 26,353 82.35% 5,647 31,049 (4,696) -15A2% Prop&Gen Liab Insurance 2,110,870 1,583,154 75.00% 527,716 833,328 749,826 89.98% Freight 71,560 71,269 99.59% 291 53,001 18,268 MA7% Misc.Operating Expense 259,250 196,983 75.98% 62,267 136,754 60,229 44.04% Regulatory Operating Fees 716,900 637,842 89A0% 78,058 696,808 (58,966) -&46% Subtotal 3,297,180 2,608,820 79.12% 688,360 1,814,719 794,101 43.76% General Mgr Contingency &Reappmpriations 665,500 0.00% 665,500 N/A Other NOo-Oper Expense 218,980 96,134 43.90% 122,846 42,209 53,925 127.76% Total Materials, Supplies&Services 77,936,910 55,137,946 70.75% 22,798,964 49,091,917 6,046,029 12.32% Total Expenditures 171,298,240 123,823,792 72.29% 47,474,448 115,685,117 8,138,675 ].D4% Cost Allocation (19,394,560) (15,875,284) 81.85% (3,519,276) (15,109,885) (765,399) &07% Net Operating Requirements $ 151.903,680 $ 107,948,508 71.06% $ 43,955,172 $ 100.575,232 $ 7,373.276 7.33% Section 2-Page 7 2017-18 Third Quarter Report Summary of Collection, Treatment,8 Disposal Expenses by Process For the Nine Months Ended March 31,2018 Increase Increase Actual Actual (Decrease) (Decrease) 3/31/18 3/31/17 $ % Process: Preliminary Treatment $ 4,934,969 $ 5,974,349 $ (1,039,380) -17.40% Primary Treatment 9,173,616 7,561,814 1,611,802 21.32% Secondary Treatment 5,894,986 5,783,658 111,328 1.92% Cryogenic Plant(Plant 2) 445,733 483,506 (37,773) -7.81% Ef0uent Disposal 439,667 463,598 (23,931) -5.16% Solids Handling 32,252,408 33,382,002 (1,129,594) -3.38% Cogeneration 13,944,722 9,586,630 4,358,092 45.46% Utilities 2,437,164 2,182,329 254,835 11.68% Electrical Distribution 1,175,555 1,024,199 151,356 14.78% Miscellaneous Buildings 8,028,368 6,750,270 1,278,098 18.93% External Location 54,019 32,237 21,782 67.57% Nedssa Vessel 174,594 162,216 12,378 7.63% North County Yard - 2,084 (2,084) -100.00% Laboratory 11,915,018 11,317,240 597,778 5.28% Collections 17,077,689 15,869,100 1,208,589 7.62% Net Operating Requirements $ 107,948,508 $ 100,575,232 $ 7,373,276 7.33% Section 2-Page 8 Operating Budget Review Staffing Trends Full Time Equivalents March 31, 2018 700 650 624 624 624 627 635 600 36 52 550 :1 500 450 6/30/14 6130115 6/30/16 6130/17 3/31/18 8Actua1 8Va.a t At March 31, 2018, the total head count was 612 employees, or a full time equivalency of 594. Section 2-Page 9 2017-18 Third Quarter Report This Page Intentionally Left Blank Section 2- Page 10 CIP Budget Review Capital Improvement Program By Type and Funding Source For the Nine Months Ended March 31,2018 MCollectlons Facilll 119% eHeadearks: 07% ePdmary TreamenC 3.3% oSecondary Treatment 06% MSolids Handling&Olgestion: 28 9% GOcean outfall S,W ms: 13.1.0% outility Systeme: 6.4% MProcess Related Special Projecle: 1,8% Mlnlormatlen Management Systems: 3 2% MStrategic&Master Planning: 2.3% Ill Management Projects: 0.1% MResearch: 0.3% OSuppod Faaltlies: 15.3% 'A Mothers: 0.1% MPdor Year Treatment Projects: 0.0% MCapilal Equipment Purchases: 2.0% Total Capital Improvement Outlays-$86,570,595 ReplacemenIlRehabilitation: 51% Improved Treatment: 15% ❑Additional Capacity: 18% ■Support: 16% Total Capital Improvement Outlays-$86,570,595 Section 3- Page 1 FY 2017-18 Third Quarter Report Summary of Capital Improvement Construction Requirements -Current Year For the Nine Months Ended March 31, 2018 2017-18 2017-18 2017-18 Cashflow Actual at Projected Budget 3/31/2018 Outlay Collection System Improvement Projects Collections Facilities Raitt and Bristol Street Sewer Rehab& Extension 68,623 - - Santa Ana River Interceptor(SARI) Realignment 201,407 55,411 55,500 SARI Rock Stabilizers Removal 515,545 207,066 309,400 Newhope-Placentia Trunk Grade Separation Replacements 132,306 17,181 57,500 Newhope-Placentia Trunk Replacement 9,464,252 3,648,894 4,083,700 Lakeview Grade Separation Project 114,950 88,628 88,700 Tustin Rose OCTA Grade Separation Project 64,700 13,574 15,600 Orangethorpe OCTA Grade Separation 12,901 10,796 10,800 Seal Beach Pumping Station Upgrade and Rehabilitation 4,375,967 511,497 1,484,700 Rehabilitation of Western Regional Sewers 9,528,506 1,768,335 4,241,700 Interstate 405 Widening Project Impacts on OCSD Sewers 36,860 46,472 165,000 Newport Force Main Rehabilitation - 109,475 149,400 Bay Bridge Pumping Station Replacement 709,700 257,877 578,500 Newport Beach Pump Stations Odor Control Improvements 67,514 - - District 6 Trunk Sewer Relief 4,616,301 2,914,182 2,921,600 Gisler-Redhill System Improvements, Reach"B" 6,698,851 4,124,455 5,017,600 MacArthur Pumping Station Rehabilitation 41,271 - - Master Facilities Engineering Projects-Collections 3,795,001 581,198 1,462,700 Master Planning Studies-Collections - 912,991 1,473,900 Research Program-Collections - 4,976 36,200 Bay Bridge Pump Station and Force Mains Rehab Study 90,344 56,276 69,000 Additional Charges to CIP Closed at 6/30/17 171,177 171,200 Subtotal-Collections Facilities 40,534,999 15,500,461 22,392,700 Revenue Area 14 Newport Force Main Rehabilitation (2.18%) 2,440 3,400 Subtotal-Revenue Area 14 2,440 3,400 Total Collection System Improvement Projects 40,534,999 15,502,901 22,396,100 (Confined) Section 3-Page 2 CIP Budget Review Summary of Capital Improvement Construction Requirements - Current Year For the Nine Months Ended March 31, 2018 2017-18 2017-18 2017-18 Cashflow, Actual at Projected Budget 3/3112018 Outlay Treatment&Disposal Projects Headworks Headworks Rehabilitation and Expansion at Plant 1 7,229,469 2,986,131 4,116,900 Truck Line Odor Control Improvements P1 35,245 53,809 122,600 Headworks Modifications at P2 for GWRS Final Expansion 1,789,057 1,018,108 2,327,800 Subtotal -Headworks 9,053,771 4,058,048 6,567,300 Primary Treatment Primary Clarifiers Repl & Impr at Plant No. 1 - 133 200 A-Side Primary Clarifiers Repl. at P2 7,038,302 2,851,184 5,096,300 Subtotal-Primary Treatment 7,038,302 2,851,317 5,096,500 Secondary Treatment Return Activated Sludge Piping Replacement Plant No.1 263,483 259,307 512,100 Activated Sludge Aeration Basin Deck Repair at P2 1,638,294 212,135 748,800 Return Activated Sludge Piping Replacement at P2 487,352 71,684 339,600 Subtotal -Secondary Treatment 2,389,129 543,126 1,600,500 Solids Handling& Digestion Digester Rehabilitation at Plant 1 2,306,580 517,027 765,900 Sludge Dewatedng and Odor Control at Plant 1 13,707,858 6,937,280 9,234,300 Solids Thickening and Processing Upgrades 267 83,406 273,000 Plant No.2 Digester Facilities Rehabilitation 159,528 296,495 558,600 Sludge Dewatedng and Odor Control at Plant 2 20,049,153 17,160,068 21,731,800 Interim Food Waste Receiving Facility 440,383 36,011 50,200 Subtotal-Solids Handling &Digestion 36,663,769 25,030,287 32,613,800 Ocean Ouffall Systems Final Effluent Sampler and Building Area Upgrades 541,037 74,780 117,000 Ocean Outfall System Rehabilitation 7,471,473 11,229,846 12,981,600 Subtotal-Ocean Outfall Systems 8,012,510 11,304,626 13,098,600 Utility Systems Cengen Emissions Control Project 251,540 66,118 66,200 Digester Gas Facilities Rehabilitation 733,218 423,204 492,700 Natural Gas Pipelines Repl at Plant No. 1 and 2 88,946 24,890 24,900 Electrical Power Distribution System Improvements - - 48,700 Uninterruptable Power Supply Impr. at P1 45,512 13,294 20,600 Consolidated Demolition&Utility Improvements at P2 11,646,047 5,015,127 10,905,400 Subtotal-Utility Systems 12,765,263 5,542,633 11,558,500 (Confined) Section 3-Page 3 FY 2017-18 Third Quarter Report Summary of Capital Improvement Construction Requirements - Current Year For the Nine Months Ended March 31, 2018 2017-18 2017-18 2017-18 Cashflow Actual at Projected Budget 3/31/2018 Outlay Process Related Special Projects Safety Improvements at Plants Nos. 1 and 2 9,986,488 1,542,339 3,393,200 Subtotal -Process Related Special Projects 9,986,488 1,542,339 3,393,200 Information Management Systems Process Control Systems Upgrades - - - Project Management Information System 1,951,448 414,165 597,200 Power Monitoring &Control Systems at P2 1,764,544 1,195,470 1,313,500 Master Information Technology Capital Program 1,176,832 702,128 1,112,700 Geographic Information System 659,791 188,091 214,100 EAM Software and Process Implementation 658,725 159,152 384,200 PDS2D Software Replacement 83,814 10,625 10,700 Process Control System Upgrades Study 963,277 101,176 497,400 Subtotal-Information Management Systems 7,258,431 2,770,807 4,129,800 Strategic& Master Planning Master Planning Studies 7,004,576 1,994,322 3,567,000 Climate Change Impact Study 147,135 9,064 18,800 Subtotal-Strategic&Master Planning 7,151,711 2,003,386 3,585,800 Water Management Projects GWRS Final Expansion Coordination 86,651 73,173 98,200 Subtotal -Water Management Projects 86,651 73,173 98,200 Research Research Program 1,305,436 247,619 3a4,500 Subtotal-Research 1,305,436 247,619 3a4,500 Support Facilities Master Facilities Engineering Projects- Plant 9,675,530 2,401,279 3,211,800 Pl Fleet Services UST Leak Remediation 1,693,273 74,633 103,200 Master Small Capital Replacement/Rehabilitation 2,308,427 - 40,600 18350 Mt. Langley Property 11,000,000 9,837,936 9,838,000 Title 24 Access Compliance&Building Rehab Project 1,709,156 513,664 1,473,400 Headquarters Complex, Site& Security&Entrance Realign. 5,389,573 416,965 1,157,100 Site and Security Improvements at Plant No.2 10,881 Subtotal-Support Facilities 31,786,840 13,244,477 15,824,100 (Confined) Section 3-Page 4 CIP Budget Review Summary of Capital Improvement Construction Requirements - Current Year For the Nine Months Ended March 31, 2018 2017-18 2017-18 2017.18 Cashflow Actual at Projected Budget 3/31/2018 Outlay Others Interstate 405 Widening Impacts on OCSD Front Entrance 16,451 21,672 21,700 P2 Southwest Perimeter Screening 46,606 24,042 36,400 Capital Improvement Program Mgmt. Services 23,600 23,600 Subtotal -Others 63,057 69,314 81,700 Additional Charges to CIP Completed at 6130/17 25,740 25,800 Total Treatment and Disposal Projects 133,561,358 69,306,892 98,058,300 Capital Equipment Purchases 3,879,300 1,760,802 3,879,300 Total Collection, Treatment and Disposal Projects and Capital Equipment Purchases 177,975,657 86,570,595 124,333,700 Less: CIP Savings and Deferrals (18,915,000) Net Collection,Treatment and Disposal Projects and Capital Equipment Purchases $159,060,657 $ 86,570,595 $124,333,700 Section 3- Page 5 FY 2017-18 Third Quarter Report Summary of Capital Improvement Construction Requirements- Project Life For the Nine Months Ended March 31,2018 Current Total Approved June 30,2017 Year Projected Remaining Project Accumulated Projected Cost at Future Budget Cost Cost June 30,2018 Budget Collection System Improvement Projects Collections Facilities Raiff and Bristol Street Sewer Rehab&Extension 13,622,000 259,075 - 259,075 13,362,925 Santa Ana River Interceptor(SARI)Realignment 11,404,000 5,673,355 55,500 5,728,855 5,675,145 SARI Rock Stabilizers Removal 6,860,000 410,508 309,400 719,908 6,140,092 Taft Branch Sewer Relief 1,928,000 12,083 - 12,083 1,915,917 Newhope-Placentia Trunk Grade Separation Replacements 4,300,000 4,059,157 57,500 4,116,657 183,343 Newhope-Placentia Trunk Replacement 112,000,000 30,442,121 4,083,700 34,525,821 77,474,179 Yoffie Linda Pumping Station Abandonment 7,053,000 - - - 7,053,000 Lakeview Grade Separation Project 330,000 70,262 88,700 158,962 171,038 Tustin Rose OCTA Grade Separation Project 586,000 423,587 15,600 439,187 146,813 Orangethorpe OCTA Grade Separation 1,505,000 1,482,972 10,800 1,493,772 11,228 Beach Trunk/Kaod Interceptor Sewer Relief 118,678,000 - - - 118,678,000 Seal Beach Pumping Station Upgrade and Rehabilitation 54,000,000 3,583,755 1,484,700 5,068,455 48,931,545 Rehabilitation of Western Regional Sewers 217,069,000 7,706,718 4,241,700 11,948,418 205,120,582 Interstate 405 Widening Project Impacts on OCSD Beware 528,000 2,866 165,000 167,866 360,134 Newport Force Main Rehabilitation 58,367,238 58,147,927 149,400 58,297,327 69,911 Crystal Cove Pumping Station Rehabilitation 10,882,000 - - - 10,882,000 Bay Bridge Pumping Station Replacement 64,000,000 217,700 578,500 796,200 63,203,800 Newport Beach Pump Stations Odor Control Improvements 4,066,000 - - - 4,066,000 District 6 Trunk Sewer Relief 7,965,000 1,791,858 2,921,600 4,713,458 3,251,542 Gisler-Redhill System Improvements,Reach"1" 25,213,000 18,093,894 5,017,600 23,111,494 2,101,506 MacArthur Pumping Station Rehabilitation 8762,000 - - - 8,762,000 Main Street Pump Station Rehabilitation 39,219,000 - - - 39,219,000 Gisler Red-Hill Interceptor Rehabilitation 15,300,000 - - - 15,300,000 Edinger/Bolsa Chica Trunk Improvements 5,159,000 - - - 5,159,000 Edinger Pumping Station Rehabilitation 8,880,000 - - - 8,880,000 Slater Avenue Pump Station Rehabilitation 9,729,000 - - - 9,729,000 Master Facilities Engineering Projects-Collections 14,192,000 816,413 1,462,700 2,279,113 11,912,887 Master Planning Studies-Collections 5,046,200 1,533,083 1,473,900 3,006,983 2,039,217 Research Program-Collections 74,000 - 36,200 36,200 37,800 Bay Bridge Pump Station and Force Mains Rehab Study 725,000 505,121 69,000 574,121 150,879 Additional Charges to CIP Closed at 6130117 171,200 171,200 (171,200) Subtotal-Collections Facilities 827,442,438 135,232,455 22,392,700 157,625,155 669,817,283 Revenue Area 14: Newport Force Main Rehabilitation(2.18%) 1,300,762 1,295,875 3,400 1,299,275 1,487 Subtotal-Revenue Area 14 1,300,762 1,295,875 3,400 1,299,275 1,487 Total Collection System Improvement Projects 828743,200 136,528,330 22,396,100 158,924,430 669,818,770 (Continued) Section 3-Page 6 CIP Budget Review Summary of Capital Improvement Construction Requirements- Project Life For the Nine Months Ended March 31,2018 Current Total Approved June 30,2017 Year Projected Remaining Project Accumulated Projected Cost at Future Budget Cost Cost June 30,2018 Budget Treatment&Disposal Projects Headworks Headworks Rehabilitation and Expansion at Plant 1 436,000,000 6,084,545 4,116,900 10,201,445 425,798,555 Truck Line Odor Control Improvements P1 9,299,000 9,035,390 122,600 9,157,990 141,010 Headworks Modifications at P2 for GWRS Final Expansion 54,000,000 229,284 2,327,800 2,557,084 51,442,916 Subtotal-Headworks 499,299,000 15,349,219 6,567,300 21,916,519 477,382,481 Primary Treatment Primary Clarifier&Trickling Filter Odor Control at P1 74,800,000 - - - 74,800,000 Primary Clarifiers Repl&Impr at Plant No.1 112,000,000 520,619 200 520,819 111,479,181 A-Side Primary Clarifiers Repl.at P2 491,000,000 4,817,329 5,096,300 9,913,629 481,086,371 Subtotal-Primary Treatment 677,800,000 5,337,948 5,096,500 10p34,448 667,365,552 Secondary Treatment Return Activated Sludge Piping Replacement Plant No.1 3,979,000 34,632 512,100 546,732 3,432,268 Activated Sludge Aeration Basin Deck Repair at P2 2,800,000 264,277 748,800 1,013,077 1,786,923 Return Activated Sludge Piping Replacement at P2 15,000.000 7,050 339,600 346,650 14,653,350 Subtotal-Secondary Treatment 21,779,000 305,959 1,600,500 1,906,459 19,872,541 Solids Handling&Digestion Digester Rehabilitation at Plant 1 67,150,000 64,908,366 765,900 65,674,266 1,475,734 Sludge Dewatering and Odor Control at Plant 1 188,328,000 165,772,702 9,234,300 175,007,002 13,320,998 Solids Thickening and Processing Upgrades 48,150,000 47,879,175 273,000 48,152,175 (2,175) Plant No.2 Digester Facilifies Rehabilitation 49,220,000 196,634 558,600 755,234 48,464,766 Sludge Dewatering and Odor Control at Plant 2 90,477,000 46,648,765 21,731,800 68,380,565 22,096,435 Interim Food Waste Receiving Facility 5,400,000 - 50,200 50,200 5,349,800 Digester P,Q,R,&S Replacement 158,000,000 1585000,000 Subtotal-Solids Handling&Digestion 606,7255000 325,405,642 32,613,800 358,019,442 2485705,558 Ocean Oulfall Systems Final Effluent Sampler and Building Area Upgrades 16,411,000 15,925,650 117,000 16,042,650 368,350 Ocean Outfall System Rehabilitafion 166,0005000 8,813,199 12,981,600 21,794,799 144,205,201 Subtotal-Ocean Oulfall Systems 182,4115000 24,738,849 13,098,600 37,837,449 144,573,551 Utility Systems Cengen Emissions Control Project 23,820000 22,247,572 66,200 22,313,772 1,506,228 UPS System Upgrades 8,087,000 - - - 8,087,000 Digester Gas Facilities Rehabilitation 96,500,000 181,030 492,700 673,730 95,826,270 Natural Gas Pipelines Repl at Plant No.1 and 2 1,310,000 24,928 24,900 49,828 1,260,172 Electrical Power Distribution System Improvements 34,608,000 - 48,700 48,700 34,559,300 (Cordnued) Section 3-Page 7 FY 2017-18 Third Quarter Report Summary of Capital Improvement Construction Requirements- Project Life For the Nine Months Ended March 31,2018 Current Total Approved June 30,2017 Year Projected Remaining Project Accumulated Projected Cost at Future Budget Cost Cost June 30,2018 Budget Utility Systems(continued) Central Generation Rehab at Plant No. 1 87,000,000 - - - 87,000,000 Unintermptable Power Supply Impr.at P1 4,800,000 3,351 20,600 23,951 4,776,049 Consolidated Demolition&Utility Improvements at P2 30,300,000 5,453,054 10,905,400 16,358,454 13,941,546 Central Generation Rehab at Plant No.2 114,000.000 114,000,000 Subtotal-Utility Systems 400,425.000 27,909,935 11,558,500 39,468,435 360,956,565 Process Related Special Projects Safety Improvements at Plants Nos.l and 2 19,000.000 1,606,938 3,393,200 5,000,138 13,999,862 Subtotal-Process Related Special Projects 19,000.000 1,606,938 3,393,200 5,000,138 13,999,862 Information Management Systems Process Control Systems Upgrades 102,399,000 - - - 102,399,000 Project Management Information System 4,000,000 701 597,200 597,901 3,402,099 Power Monitoring&Control Systems at P2 5,000,000 2,211,062 1,313,500 3,524,562 1,475,438 Master Information Technology Capital Program 10,000,000 573,006 1,112,700 1,685,706 8,314,294 Geographic information System 4,568,000 2,456,512 214,100 2,670,612 1,897,388 EAM Software and Process Implementation 7,500,000 4,765,108 384,200 5,149,308 2,350,692 PDS2D Software Replacement 530,000 352,351 10,700 363,051 166,949 Process Control System Upgrades Study 3,554,000 69,484 497,400 566,884 2,987,116 Subtotal-Information Management Systems 137,551,000 10,428,224 4,129,800 14,558,024 122,992,976 Strategic&Master Planning Master Planning Studies 23,605,800 6,295,834 3,567,000 9,862,834 13742,966 Climate Change Impact Study 590,000 3,919 18,800 22,719 567,281 Subtotal-Strategic It Master Planning 24,195,800 6,299,753 3,585,800 9,885,553 14,310,247 Water Management Projects GWRS Final Expansion Coordination 1,132,000 98,200 98,200 1,033,800 Subtotal-Water Management Projects 1,132,000 - 98,200 98,200 1,033,800 Research Research Program 8,426,000 54,133 384,500 438,633 7,987,367 SCCWRP Nutrient Cycling Sampling 95,000 95,000 95,000 Subtotal-Research 8,521,000 149,133 384,500 533,633 7,987,367 (Continued) Section 3-Page 8 CIP Budget Review Summary of Capital Improvement Construction Requirements- Project Life For the Nine Months Ended March 31, 2018 Current Total Approved June 30,2017 Year Projected Remaining Project Accumulated Projected Cost at Future Budget Cost Cost June 30,2018 Budget Support Facilities Master Facilities Engineering Projects-Plant 28,373,000 6,269,643 3,211,800 9,481,443 18,891,557 P1 Fleet Services LIST Leak Remediation 14,952.000 194,404 103,200 297,604 14,654,396 Master Small Capital ReplacementlRehabilitation 15,622,000 626,765 40,600 667,365 14,954,635 18350 Mt.Langley Property 11,000,000 - 9,838,000 9,838,000 1,162,000 Title 24 Access Compliance&Building Rehab Project 18,400,000 13,852,170 1,473,400 15,325,570 3,074,430 Headquarters Complex,Site&Security&Entrance Realign. 179,067,000 528,437 1,157,100 1,685,537 1]],381,463 Site and Security Improvements at Plant No.2 252,000 236,410 - 236,410 15,590 P2 Warehouse Relocation 9,800,000 - - - 9,800,000 P2 Collections Yam Relocation 1,500,000 - - - 1,500,000 TPAD Digester Facility at P2 419,000,000 419,000,000 Subtotal-Support Facilities 697,966,000 21,707,829 15,824,100 37,531,929 660,434,071 Others Interstate 405 Widening Impacts on OCSD Front Entrance 2,655,000 - 21,700 21,700 2,633,300 Banning Gale Relocation&Grading at Plant No.2 2,931,000 - - - 2,931,000 P2 Southwest Perimeter Screening 2,800,000 - 36,400 36,400 2,763,600 Capital Improvement Program Mgml.Services 300,000 61,180 23,600 84,780 215,220 Subtotal-Others 8,686,000 61,180 81,700 142,880 8,543,120 Additional Charges to CIP Completed at 6130117 25,800 25,800 (25,800) Total Treatment and Disposal Projects 3,285,490,800 439,300,609 98,058,300 537,358,909 2,748,131,891 Capital Equipment Purchases 16,000,000 9,058,965 3,879,300 12,938,265 3,061,735 Total Collection,Treatment and Disposal Projects and Capital Equipment Purchases $4,130,234,000 $584,887,904 $124,333,700 $709,221,604 $3,421,012,396 Section 3-Page 9 FY 2017-18 Third Quarter Report This Page Intentionally Left Blank Section 3- Page 10 Capital Assets Schedule & Debt Service Budget Review Capital Assets Schedule For the Nine Months Ended March 31, 2018 Capital Facilities Budget Review Balance Year-ta-Date Balance 07/01/17 Additions 3131/18 CONSTRUCTION IN PROGRESS: Treatment Plant $ 386,799,209 $ 71,067,694 $ 457,866,903 Collection System 75,034,241 15,502,901 90,537,142 Subtotal 461,833,450 86,570,595 548,404,045 PROPERTY,PLANT&EQUIPMENT(at cost): Land and Property Rights 25,247,046 - 25,247,046 Collection Lines and Pump Stations 830,551,347 - 830,551,347 Treatment Facilities 2,366,129,584 - 2,366,129,584 Effluent disposal facilities 97,014,820 - 97,014,820 Solids disposal facilities 3,463,236 - 3,463,236 General and administrative facilities 246,051,157 - 246,051,157 Excess purchase price over book value on acquired assets 19,979,000 19,979,000 Subtotal 3,588,436,190 3,588,436,190 Total Properly,Plant&Equipment&CIP $ 4,050,269,640 $ 86,570,595 $ 4,136,840,235 Debt Service Budget Review 2017-18 Year-to-Date Remaining Budget Payments %of Budget Budget Principal Payments by Debt Issue: 2009A COP 4,465,000 4,465,000 100.00% - 2010ABABs - - 0.00% - 2010CBABs - - 0.00% - 2011ACOP 20,960,000 20,960,000 100.00% - 2012ACOP - - 0.00% - 2012BCOP - - 0.00% - 2014ACOP 6,715,000 6,715,000 100.00% - 2015ACOP - - 0.00% - 2016ACOP - - 0.00% - 2016BCANs 7,426,217 - 0.00% 7,426,217 2017A COP 0.00% Subtotal Principal Payments 39,566,217 32,140,000 81.23% 7,426,217 Interest Expense by Debt Issue: 2009A COP 457,750 306,150 66.88% 151,600 2010A BABs 2,897,639 2,493,707 86.06% 403,932 2010C BABs 6,523,780 5,614,495 86.06% 909,285 2011ACOP 3,872,350 2,598,650 67.11% 1,273,700 2012A COP 3,735,900 2,802,000 75.00% 933,900 2012E COP 3,187,400 2,390,500 75.00% 796,900 2014A COP 4,254,500 3,134,900 73.68% 1,119,600 2015A COP 6,375,500 4,781,600 75.00% 1,593,900 2016A COP 6,977,300 5,233,000 75.00% 1,744,300 2016B CANs 865,692 1,648,050 190.37% (782,358) 2017A COP 3,318,500 2,489,917 75.03% 828,583 Subtotal Interest Expense 42,466,311 33,492,969 78.87% 5,588,917 Total Debt Service $ 82,032,528 $ 65,632,969 80.01% $ 13,015,134 Section 4- Page 1 2017-18 Third Quarter Report This Page Intentionally Left Blank Section 4 - Page 2 Self Insurance Budget Review General Liability and Property Fund Budget Review For the Nine Months Ended March 31,2018 Percent Actual of Budget Remaining Actual 2017-18 Through Through 2017-18 Through Increase Budget 3/31/18 3131/18 Budget 3/31117 (Decrease) Revenues: In-Lieu Premiums $ 2,110,870 $ 1,583,154 75.00% $ 527,716 $ 833,328 $ 749,826 Miscellaneous Other Revenue - 3,532 N/A - 8,865 (5,333) Service Department Allocations 18,700 14,022 74.98% 4,678 14,022 - Total Revenues 2,129,570 1,600,708 75.17% 532,394 856,215 744,493 Expenses: Benefits/Claims 100,000 2,500 2.50% 97,500 671,865 (669,365) Legal Services 130,000 2,706 2.08% 127,294 77,032 (74,326) Professional Services 25,000 0.00% 25,000 25,976 (25,976) Subtotal 255,000 5,206 2.04% 249,794 774,873 (769,667) Policy Premium Expense 1,080,000 901,583 83.48% 178,417 878,290 23,293 Total Expenses 1,335,000 906,789 67.929/6 428,211 1,653,163 (746,374) Excess Revenue(Expense) 794,570 693,919 $ 104,183 (796,948) 1,490,867 Beginning Reserves 54,205,430 54,445,772 55,252,299 (806,527) Ending Reserves $55A00,000 $55,139,691 $ 54. 555.351 $ 884,340 Section 5-Page 1 FY 2017-18 Third Quarter Report Workers' Compensation Fund Budget Review For the Nine Months Ended March 31,2018 Percent Actual of Budget Remaining Actual 2017-18 Through Through 2017-18 Through Increase Budget 3/31/18 3/31/18 Budget 3131117 (Decrease) Revenues: In-Lieu Premiums $ 554,330 $ 415,747 75.00% $ 138,583 $ 897,225 $ (481,478) Miscellaneous Other Revenue 10,000 - 0.00% 10,000 - - Total Revenues 564,330 415,747 73.67% 148,583 897,225 (481,478) Expenses: Benefits/Claims 600,000 333,693 55.62% 266,307 236,299 97,394 Legal Services 175,000 71,415 40.81% 103,585 29,361 42,054 Professional Services 65,000 45,657 70.24% 19,343 50,307 (4,650) Subtotal 840,000 450,765 53.66% 389,235 315,967 134,798 Policy Premium Expense 200,000 145,184 72.59% 54,816 148,421 (3,237) Total Expenses 1,040,000 595,949 57.30% 444,051 464,388 131,561 Excess Revenue(Expense) (475,670) (180,202) $ (295,468) 432,837 (613,039) Beginning Reserves 2,475,670 2,464,418 1,913,178 551,240 Ending Reserves $ 2,000,000 _L 2.284,216 $ 2.346,015 $ (61,799) Section 5-Page 2 9 bm April 30, 2018 STAFF REPORT Quarterly Treasurer's Report For the Three Months Ended March 31, 2018 SUMMARY Section 15.0 of the District's Investment Policy includes quarterly reporting requirements for the District's two investment portfolios. These two funds, the "Liquid Operating Monies," and the "Long-Term Operating Monies" are managed by Chandler Asset Management, the District's external money manager. The ongoing monitoring of the District's investment program by staff and Callan Associates, the District's independent investment advisor, indicates that the District's investments are in compliance with the District's adopted Investment Policy and the California Government Code, and that overall performance has tracked with benchmark indices. In addition, sufficient liquidity and anticipated revenues are available for the District to meet budgeted expenditures for the next six months. The District's portfolios do not include any reverse repurchase agreements or derivative securities. ADDITIONAL INFORMATION Performance Reports The Quarterly Strategy Review, prepared by Chandler Asset Management, and the Investment Measurement Service Quarterly Review, prepared by Callan Associates, is attached for reference. Also attached are Long-Term and Liquid Operating Monies Summary of Performance Data and Portfolio Statistics charts that depict the performance results, estimated yield and duration, credit quality, and sector diversification of the District's portfolios, as of March 31, 2018. The Liquid Operating Monies portfolio, with an average maturity of 66 days, consists entirely of high quality fixed income investments consistent with the District's investment policy. Portfolio Performance Summary The following table presents a performance summary of the District's portfolios as compared to their benchmarks for the period ended March 31, 2018. OCSD ♦ P.O.Box8127 ♦ Fountain Valley,CA 92]2M12] ♦ (716)%2-2411 Quarterly Treasurer's Report For the Three Months Ended March 31, 2018 Page 2 of 3 Portfolio Performance Summary As of March 31,2018 Liquid Operating Monies(%) Long-Term Operating Monies(%) Total Rate of Total Rate of Return Benchmark(" Realm Benchnmd 01 3 Months 0.35 0.35 -0.33 -0.45 6 Months 0.64 0.64 -0.57 -0.76 9 Months 0.90 0.91 -0.16 -0.39 12 Months 1.11 1.11 0.31 0.09 Annual¢ed Since inception 30 Nov 2014 0.59 0.48 0.88 0.78 Market Value 92aM S412.8M Average Quality "AAA'fAal" "AA-YAa1" Current Yield(%) 1.4 1.9 Estimated Yield to Maturity(%) 1.8 2.4 Quarterly Deposits(Withdmwals) ( 53.0M) 17.5M Estimated Annual Income 1.5M T8.1 M (1) Benchmarks: • Liquid Operating Portfolio: 3-Month Treasury Bill Index • Long-Term Operating Portfolio: Merrill Lynch Corp/Govt. 1-5 Year Bond Index Portfolio Market Values Comparative marked-to-market quarter-end portfolio values are shown in the following table, and in the attached bar chart. Liquid Long-Term Quarter Operating Operating Ending Monies($M) Monies($M) 30 Jun 17 124.4 331.8 30 Sep 17 49.5 333.2 30 Dec 17 145.5 396.6 31 Mar 18 92.9 412.8 District's Investment Account Balances as of March 31,2018 Book Balances Estimated Investment Accounts March 31,2018 Yield(%) State of Calif.LAIF $47,499,172 1.52 Union Bank Checking Account 98,140 0.25 Union Bank Overnight Sweep Account 24,226,838 1.34 Union Bank W/C Checking 33,933 0.25 Union Bank Muller Account 46,603 0.80 Chandler-Short-term Portfolio 92,664,220 1.77 Chandler-Long-term Portfolio 411,064,267 2.42 Petty Cash 3,000 N/A BNY Mellon OCIP Reserve 3,612,420 0.75 TOTAL $579 248 593 2.19 Debt Service Reserves w/Trustees $ B35 Z 1.50 Quarterly Treasurer's Report For the Three Months Ended March 31, 2018 Page 3 of 3 District's Cost of Funds on Debt Issues as of March 31, 2018 Annual Cost of Funds Outstanding Interest Issue Description COP Balance Rate(%) 2009A Fixed S4,690,000 4.72 2010A Fixed 80,000,000 3.68 201 OC Fixed 157,000,000 4.11 2011A Fixed 75,370,000 2.61 2012A Fixed 100,645,000 3.54 2012B Fixed 66,395,000 1.50 2014AFixed 78,375,000 2.34 2015A Fixed 127,510,000 3.30 2016A Fixed 145,880,000 3.02 2016B Fixed 109,875,000 0.87 2017A Fixed 66.370 000 2.55 TOTAL $I 012.11(t01N1 Weighted Avg.Cost of Funds 2.89 ATTACHMENTS 1. Chandler Quarterly Report 2. Summary of Performance Data and Portfolio Statistics — Liquid Operating Monies 3. Summary of Performance Data and Portfolio Statistics— L-T Operating Monies 4. Investment Transactions and Balances in LAIF 5. Asset Summary by Asset Type — Liquid Operating Portfolio 6. Asset Summary by Asset Type — Long Term Portfolio 7. Asset Summary by Asset Type — Owner Controlled Insurance Program Escrow with Liberty Mutual 8. Investment Listing -Yield 9. Asset Detail — Consolidated 10. Custody Transaction History—Consolidated 11. Callan Quarterly Review 12. Chandler Quarterly Review 13. Rating Agency Comparisons C/" CHANDLER ASSET MANAGEMENT March 31, 2018 Mr. Lorenzo Tyner Director of Finance Orange County Sanitation District 10844 Ellis Avenue Fountain Valley CA 92708-7018 Dear Lorenzo, Bond Market Recap The Federal Open Market Committee (FOMC) raised the fed funds target rate to a range of 1.50%-1.75% at the March 21 meeting, as expected. The vote was unanimous. In the policy statement, the Fed said economic activity has been "rising at a moderate rate' which was somewhat less bullish than the "solid rate" of growth cited in the January statement. Household and business fixed investment moderated from the fourth quarter. Inflation for items other than food and energy continues to run below 2.0% but the Fed expects inflation to move up in the coming months. The FOMC left its median fed funds rate forecast unchanged for 2018 at 2.1% which implies two more rate hikes by year-end. Although the forecasted median fed funds rate for 2018 did not change, the dot plot did change with 13 out of 15 FOMC members forecasting two or more rate hikes this year, compared with 10 out of 16 members at the December 2017 meeting. The fed funds rate targets for 2019 and beyond were revised up slightly. By the end of 2020, the FOMC's median forecast now calls for a fed funds rate of 3.4%. Overall, the Fed revised their GDP forecasts up slightly, their unemployment forecasts down slightly, and left their inflation projections mostly unchanged. We are forecasting GDP growth of about 2.5%-3.0% in 2018, which is in line with the Fed's forecast and the market consensus. This would equate to an increase over 2017 GDP growth of 2.3%. Overall, economic data remains solid, with the exception of still-sluggish inflation readings. The economy is at or near full employment, consumer confidence is strong, and leading indicators suggest the economy will continue to grow. The Treasury yield curve flattened in March. The 2-year Treasury yield increased slightly to 2.27%from 2.25%, while the 10-year Treasury yield decreased about 12 basis points to 2.86%. At month end, the spread between 2- and 10-year Treasury yields was just 47 basis points; quite flat by historical standards. All else being equal, we believe the Fed's plan to normalize the balance sheet will help promote a steeper yield curve later this year. Tax reform and stronger economic growth may also help drive yields at the long end of the curve higher. However, we believe this is somewhat offset by anticipated ongoing monetary policy normalization by the Fed. Year-over-year, shorter-term Treasury yields have increased more than longer-term Treasury yields. The increase in shorter-term rates has been driven by the Federal Reserve's steady increases in the target fed funds rate. Meanwhile, longer-term rates (which are more closely tied to inflation expectations and the outlook for economic growth) have remained relatively contained. 1 C/" CHANDLER ASSET MANAGEMENT Consumer Prices The Consumer Price Index (CPI) was up 2.4% year-over-year in March, up from 2.2% in February. Core CPI (CPI less food and energy) was up 2.1% year-over-year in March, up from 1.8% in February. The Personal Consumption Expenditures (PCE) index was up 1.8% year- over-year in February versus 1.7% in January. Core PCE (excluding food and energy) was up 1.6% on a year-over-year basis in February versus 1.5% in January. Retail Sales On a year-over-year basis, retail sales were up 4.0% in February, versus up 3.9% year-over- year in January. On a month-over-month basis, retail sales decreased 0.1% in February (below the consensus forecast of +0.4%). Excluding autos and gas, retail sales were up 0.3% in February, slightly below expectations, following a 0.1% decline in January. Despite ongoing strength in the labor market and a high level of consumer confidence, consumer spending remains modest. Labor Market U.S. payrolls rose by 103,000 in March, well below the consensus forecast of 175,000. January and February payrolls were also revised down by a net total of 50,000. On a trailing 3-month and 6-month basis, payrolls increased by an average of 202,000 and 211,000 per month, respectively. The unemployment rate was unchanged at 4.1%. The labor participation rate edged down to 62.9% from 63.0%. A broader measure of unemployment called the U-6, which includes those who are marginally attached to the labor force and employed part time for economic reasons, declined to 8.0% from 8.2%. Wages rose 0.3% in March, in line with expectations. Wages were up 2.7% on a year-over-year basis in March, versus up 2.6% year- over-year in February. The average workweek was unchanged at 34.5 hours. Housing Starts Total housing starts were weaker than expected in February, down 7.0%. Single-family starts rose 2.9% in January, while multi-family starts fell 26.1%. 2 C/" CHANDLER ASSET MANAGEMENT TREASURYYIELDS 3/3112018 12131/2017 CHANGE 3 Month 1.71 1.38 0.33 2 Year 2.27 1.89 0.40 3 Year 2.38 1.97 0.35 5 Year 2.56 2.21 0.27 7 Year 2.69 2.33 0.16 10 Year 2.74 2.41 0.08 30 Year 2.97 2.74 (0.12) Economic Data Points to Continued Growth ECONOMIC INDICATOR Current Release Prior Release One Year Aga Trade Balance (57.6)$Bln FEB 18 (56.7)$Bln JAN 18 (44A)SBIn FEB 17 GDP 2.9%DEC 17 3.2%SEP 17 1.8%DEC 16 Unemployment Rate 4.1%MAR 18 4.1%FEB 18 4.5%MAR 17 Prime Rate 4.75%MAR 18 4.50%FEB 18 4.00%MAR 17 CRB Index 195.36 MAR 18 193.95 FEB 18 185.88 MAR 17 Oil(West Texas Int.) $64.94 MAR 18 $61.64 FEB 18 $50.60 MAR 17 Consumer Price Index(y/o/y) 2.2%FEB 18 2.1%JAN 18 2.7%FEB 17 Producer Price Index(y/o/y) 2.7%FEB 18 3.0%JAN 18 3.8%FEB 17 Dollar/Euro 1.23 MAR 18 1.22 FEB 18 1.06 MAR 17 S.0 Bloombery 3 C/" CHANDLER ASSET MANAGEMENT Performance Attribution Long-Term Portfolio Similar to the prior quarter the Long-Tenn portfolio outperformed the benchmark on a relative basis but generated negative total returns. The portfolio returned -0.33% versus the -0.45% return for the ICE Bank of America Merrill Lynch 1-5 Year US Corporate and Government AAA- A Index, a positive differential of 0.12%. The drivers of the positive relative return were both the duration positioning of the portfolio, which was lower than the benchmark, and the term structure of the portfolio, with a tactical underweight in the one to three year portion of the maturity distribution relative to the benchmark. The one to three portion of the market underperformed as the Treasury curve continued the bear flattening theme with front end interest rates rising more than longer maturity interest rates. The Chandler team added multiple securities to the portfolio across the Treasury, Agency, Supranational, Asset Backed, Commercial Paper, and Corporate sectors of the market to keep the portfolio positioning in-line with our strategic targets. The purchased securities ranged in maturity from February 2018 to February 2023; the majority of the new holdings in the portfolio were either beyond four years or inside of one year, with less of a focus in the intermediate portion of the maturity distribution where the portfolio remains underweight. The overall duration of the portfolio increased to 2.41; below the benchmark duration of 2.56. The Chandler team will be focusing on adding exposure to the Supranational, Asset Backed, and Corporate sectors of the market in the coming quarter where relative value opportunities are more attractive compared to the more expensive Agency sector. Liquid Portfolio The Liquidity Portfolio matched the return of the ICE Bank of America 3-Month Treasury-Bill Index during the quarter, generating a return of 0.35%. The portfolio experienced positive cash flows totaling $53 million. Many securities were purchased across the Treasury, Agency, Certificate of Deposit, Commercial Paper, and Corporate sectors of the market to keep the portfolio as fully invested as possible. Three securities were called and many matured, including some large positions on March 31, 2018 (a Saturday) which contributed to the large reported money market fund allocation at the end of the reporting period. Due to issuance trends from the US Treasury, the Agency discount note market is trading with yields below that of the US Treasury Bill market, thus the allocation to the Treasury sector is poised to increase until the market dynamic reverses. Consistent with prior quarters, the Chandler team opportunistically allocated to spread product across the maturity spectrum, while utilizing the Treasury and Agency allocation to offset the forecasted liquidity needs of the portfolio. 4 CHANDLER ASSET MANAGEMENT Economic Outlook The fundamental backdrop of the domestic economy remains solid as GDP growth accelerated in the second half of 2017; fourth quarter GDP came in at 2.9% compared to 1.8% in the fourth quarter of 2016. The unemployment rate remains low at 4.1% and non-farm payrolls are robust with the most recent three month and six month moving averages coming in at 202k and 211 k through March 2018, respectively. Core inflation has been ticking modestly higher, but importantly the Core PCE on a year-over-year basis remains below the Federal Reserve's 2.0% target, with the most recent reading at 1.6%. The Chandler team is keeping a close eye on wage inflation. Given the aforementioned low unemployment rate the inability of wage inflation on to accelerate comfortably into the 3.25-3.50% range on a year-over-year basis is an anomaly. Changing demographic trends and a still elevated U-6 unemployment rate (8.0% most recently) are contributing factors to the benign wage inflation numbers. Looking out over the next six to twelve months the risk of a recession in the United States is low. Risk assets, on the other hand, experienced heightened volatility and negative price action in the latter two months of the quarter. The magnitude of the price changes on the equity side from a price perspective felt very significant, but on percentage terms less so. The earnings backdrop for US corporations is positive, however there is a growing concern market participants had become too complacent. Throughout 2017 risk markets shrugged off the negative news; the S&P 500 Equity Index moved higher in eleven of twelve months of 2017. The beginning of 2018 started out very strong, but as interest rates moved higher and the lack of continuity in the Trump administration received additional focus, risk assets experienced negative price action. Investors are also processing the implications of global monetary policy turning less accommodative, with the Federal Reserve leading the way in gradually removing accommodation. The annual rotation of voting Federal Reserve Bank Presidents took place in January and Jerome Powell was sworn in as the new Fed Chair on February 5th. Historically Powell's voting record is consistent with the prior Chair, Janet Yellen, and market participants are not forecasting a significant change at the Fed related to the new leadership. Monetary policy continued to gradually normalize during the quarter with the Federal Open Market Committee (FOMC) raising the federal funds rate by 25 basis points to a range of 1.50% to 1.75% at the March 21 meeting. The FOMC also continued the balance sheet normalization program, currently at $20 billion per month ($12 billion in Treasury securities and $8 billion in mortgage backed and agency securities), which is set to increase $30 billion per month in April 2018. The market has thus far absorbed the reduction in the Federal Reserve's balance sheet quite well, however the Chandler team expects the term premium in the Treasury market to ultimately be pressured due to both the greater velocity of balance sheet reduction later in the year and the increased amount of Treasury issuance due to the recently enacted tax reform bill. Similar to the prior quarter, interest rates moved higher across all maturities, with shorter maturity notes continue to lead the way as the Treasury curve continued to experience a flattening bias. Two year Treasury notes increased by 38 basis points to end the quarter at 2.27% and Ten year Treasury notes increased by 33 basis points to end the quarter at 2.74%. Spreads in the investment grade fixed income market also came under pressure partially correlated with the negative price action in equity markets. New issue volume was elevated in January but tailed off in February and March, compared to the prior year, as the negative price action in risk assets kept issuers on the sidelines. 5 GAL CHANDLER ASSET MANAGEMENT Strategy Strategy highlights for the Long-Term Portfolio in coming months: • Tactically increase the portfolio's exposure to the Corporate sector to 25%; currently 21%. o Credit spreads have become more attractive in certain sectors with risk assets coming under some pressure. o The Chandler team will use a combination of maturing notes in the Credit sector, as well as reducing the portfolios exposure to the Treasury and Agency allocations, to accommodate the new holdings in the portfolio. • The Agency sector continues to profile as expensive in Chandler's judgement and the allocation to the sector will remain modest compared to the historical experience. • Short maturity Asset Backed securities remain attractive on a risk adjusted basis and the team will look to utilize the new issue market to maintain and/or modestly increase exposure to the sector. • Exposure to the Supranational asset class will continue to grow as the spreads available in the sector are superior compared to the Agency sector. • The duration of the portfolio will increase moderately given the large change in interest rates over the past six months. Strategy highlights for the Liquidity Portfolio in coming months: • Continue to ladder the Treasury and Agency exposure to coincide with forecasted liquidity needs. • Opportunistically add Corporate, Negotiable CD, Commercial Paper, and Supranational exposure to the portfolio where the additional spread compensation versus alternative sectors is attractive. • Maintain a dedicated exposure to the Treasury sector on an ongoing basis to ensure ample liquidity in the portfolio at all times. 6 C/" CHANDLER ASSET MANAGEMENT Compliance IssueS CA Orange County Sanitation District Long Term March 31,zole COMPLIANCE WITH INVESTMENT POLICY Assets managed by Charmer-Asset Management are in full compliance wth state lawand will the investmenfpolicy Category Stanall Comment Treaslrylssues Syearemaxmatudy Minimum allocalionof10% Complies' U.S.Agarciea 20%max Issuer, 5"am max maturity Complies Stprerabonal "AA'ratetlorbetlerbya NRSRO; 30%maximum; 5ysammaimatudy USD Complies denominated senior unsecured umubopinated obligations issued or uncontlitionaly uadmissed by BRD IFC or ADD Carol(Ml Watedorbelterion, ermdebtbya NRSRO; 30%maximum5%maxiesuer, 5yeare Complies maxmaldriy, Issued by wrporations organised and operating withinthe U.S.or issued by th.positoryinsfitufflons licensed b the U.S. Mmicipal Sissuri s 'N'mWdorhigharbya NRSRO;10%maximum; 556maxisauer; 5yearemaxmatriy Complies Asset Backadl CMOal Mortgage- 'AA-mtetlorbeCerbya NRERO; W erhigiarisauerratMirya NRSRO; 20%maximum; Complies' backed 5%maxissuer excludi oMa a bs'5 ammaxmaWri Negotiable CDs 'A'rated or better long tens debt bya NRSRO;or-A-1'/highest shorttenn rating by a Complies NRSRO: 30%maximum;5%maxissuer,5 yeam max msh ny Cerdficateaof Deposit 5%maxissuar; 5yearemaxmatuiy. Secured/wImealisetl Complies Bankers Acceptances A-1 rated or equivalent shod term rating by a NRSRO; 40%maximum; 5%max issuer,180 Complies days max maturty Commemlel Paper A-1 noted or aqul silent shod term rating by NRSRO; 'A'or better long tern debt Issuer Complies bya NRSRO; IssmdbyadomestcwMomtonoyanimdaMopamfiMintha USwith AUM>$500million' 25%maximurn' 5%maxissuer, 270daysmaxinalunty Mutual Fund B Morey Mallet Highestnofingor-AAA-hii by WU NRSROs;SEC registered addserwllh AUM>$500 Complies Mutual Furl million all experience greaterthan5 ysars;10%par Ore Mutual Furl; 20%maxper issuaron Mona Market MrWel Funds; 20%maxoftheDistridasempliternaney, Re urctase Agreements 102%collateraliseGon Complies Reverse Re nrehase axi Agreements 5%mmurn,90 days max matuffly, Complies LAF Not it by irnsstrment admaer Complies OCP Not used by imeshnent atlNaer Complies A Duration Noto exceed!80 months - 80%W 120%ofthe benchmark Com Ties Max Per Issuer 5%of articllo exe le ArmnationaIs,U.S.Gogemment,Agenelas,Mutual Fund Com lies Maiddrun-Malunity 15 were maximum mahnity Com lies- Mcree lorem twenty-theeash theadiw wltth steel gaoler fan 5 years-Il lno ors,(1)ADS,kv(4)Carl semnteen(17)MBS had one treasury All secuAOee me,shented fiom the samosa manoser and cemgied at time W Armase. 7 C/" CHANDLER ASSET MANAGEMENT C/" Orange County Sanitation District Liquid March 31,2018 COMPLIANCEPOLICY Assets managed 6y GhantllerAsset Management are in/ull compliance wM state lawand vith Me inveshnentpolicy Category Standard Comment Treasury Issues l yearmexmaturity, Minimum allocation of 10% Complies U.S.Ageocies 20%max issuer; IWar max maturity Complies Supharational 'AA"rated or better by a NRSRO; 30%maximum; 1 War max maturity; USD Complies denominated senior unsecured ureubordirated obligations issued or unconditionall guarninteedb IBM,IFC or ADS Corporate(Ml 'A'hared or betlerlong tern debt bya NRSRO; 30%mavmum;5%maxisswr,, Complies l year max mal Issued by corporations organized and operating wt0in the U.S.or issued by depository depostory institutions licensed by tie U.S. Asset Backed/CMOs 'AA-mtsdorbeUerbya NRSRO; "A"or higher issuer rating bya NRSRO; 20% Complies maximum 5%max issuer; 1 War max maNd Negotiable CDs "A"rated or better long term debt by a NRSRO;or"A-1"/highest shorttenn rating Complies by aNRSRO; 30%mavmum;5%max issuegi War max maturity Certificates of Deposit 5%max issuer;i war max mal Securadleollateralized Complies Banker's Acceptances A mted or equivalent stud term rating by a NRSRO; 40%maximum; 5%max Complies issuer;180 days max maturity Commercial Paper A-1 rated or eguvalent shod tens rating by a NRSRO; "A'or better brig term Complies debt issuer by a NRSRO; asuedbyadomesticcorpomtionorganizedarxl operating in the US with AUM>$500million; 25%mavmum; 5%max issuer, 270 days max maturity Mutual Fund&Morey Market Mutual Fund Highestratingor"AAA"hated bytso NRSROs;SEC registered adviserwith Complies AUM>$500 million and experience greatert an 5 years 10%per one Mutual Fund; 20%maxperissueron Morey Mallet Mutual Fulls; 20%maxotthe Districts surplus mono Repurchase Agreemets 102%collateralieetion Complies Revaree Repurchase Agreements 5%maximum,90 days max meaalty Complies LAIF Not used by investment adviser Complies OCIP Not used by investment adviser Complies Prohibited Municipal Securities Complies Prohibited Mortgage Securities Complies Avg Duration Nottoexceed180days; Maxduratonofl2War Complies Max Per Issuer 5%of portfolio(except Supranatiorals,U.S.Gocemment,Agencies,Mural Fund) Complies Maximum Maturity 1 War mavmum bradurity Complies 8 C/" CHANDLER ASSET MANAGEMENT CA OCSD Lehman Exposure March 31,2018 COMPLIANCE WITH INVESTMENT POLICY Assets managed by Chandler-Asset Management are in full compliance wth state lawand wth the investment policy Category standard Comment Treasurylssues 5 years maximum poll Complies Swonational "AA"or better by I of 3 NRSROs; 30%maximum; 5%max; 5years maturity, Complies Includes only: IADB,BIRD,add IFC per CGC U.S.A encies 20%max issuer; 5 yam maximum maturity Complies U.S.Corporate(MTNs) Wor better long term rating by l of 3 NRSROs; 30%maximum;5%max issuer; 5 Complies• Were max maturity Municipal Securities W or higher by 1 of 3 NRSROQ I0%maximum 5%max issuer; 5 years Complies maximum matunly Asset Bal CMOs/ "AA"or better by l of 3 NRSROs; "A"or higher issuer mfing by l of 3 NRSROs; Complies Mortgage-backed 20%maximum; 5%maxissuer(excluding MB$/govl agency);5 years max mustily Negotiable CDs "A•orbetteron its long farm debtbylof3NRSRCs; "A1/P1"or highest shstwol Complies brings,b 1of 3 NRSROs; 30%maximun;5%max issuer, 5 years max maturity CDSITD$ 5%max issuer, 5warsnaulmarturrifty, Complies Bankers Acceptances A-1,or equiyakrt Ngheat short tens ral by l of3 NRSRO5; 40%maximum; 5% Complies max issuer'180 days max maturity Commercial Paper A-1,or equivalent by l of3 NRSRO3; "A"or better by 1 of3 NRSRCs,if long term Complies debtissued; 25%maximum; 5%max issuer. 270 days max maluri Money Market Ford Highest rating by 2 of 3 NRSROs; 20%maximum;10%max issuer Complies Repurchase A reemerts 102%collateralization Complies Reverse Repurchase 5%maximum,90 days max maturity Complies Agreements monthsLAIF Not used by neesbrent adwser Control as Not to exceed 60 16MMunim Mean, .5 am maximum onaturity I Carl as A—rd Mltls V millm face value(cusip 525ESCOl and$Erin,Wn face value(cusip 525ESCtB])W defaulted LeM1man Bras Hddings that were pumhssed by the pregous manager Comgled er Ome of purrhase. 9 C/" CHANDLER ASSET MANAGEMENT Defaulted Bonds OCSD Lehman Exposure-Account#1028C For the Month Ending 3/3112018 SLHOPRM In 0,PoNion bng 60W149 2 a000vre owovalnam I�u'�°'1 9.Y¢.Y Tobl tammmb Sxt U. NM2N I. I]2]31.w1 N, 52f GIB7 J 66I"110 1.1.2001 90 74 405 2 18]Ph P111,W3]<) CCPA. E 2,011 O10 ICO.. 1156% . AP 1.W.r6WA 1"SUM N.L% Na I SIRNAZ 1pN.6%SI A. O.w 11160.Y9 su roTNP armR O s..L. li6o.As 11 Pow n. NNrN% xR1OXx 1. IS rare.MARREry UE PLUS ACCRUALS 1NpxtN 10 OIL CHANDLER ASSET MANAGEMENT Ratings Orange County Sanitation District Long Term March 31,2018 ve.December 31,2017 mmx mmx iomx ximx lame oms .3ffV[Ote a]n VAn MA M A U MR Owl/18 14.6% 625% 13.3% 01% a9% IMI/17 15.6% 63,6% 116% 11% 73% Orange County Sanitation District Liquid March 31,2018va.December 31,2017 m.m% mm% mm% mm% mm% .aavmla .walaon AM M A l,A MR 03131I18 56.9% 35.2% 8.0% 0.0% 00% 1MI117 32.0% 61.5% 6.1% 0.0% 0.0% Bw,w:88P Foo, 1T C/" CHANDLER ASSET MANAGEMENT OCSD Investment Program Quarter End Portfolio Value $600,000,000 •Liquid Operating Monies $600,000.000 •Long-Term OpereYng Monies 5400,000,000 $300,000,000 $200,000,000 $100,000.000 S- S O°c 4id "cq 1% Oa, 4id rc Se 66 4ie "co Se Q 41 a � 41 O'q, IV 4IV IV �S CIS a7S7S IS �S aI& IS �J ��J �1J HISTORICAL YIELD CURVE 4.00% 3.00% 2.69 �¢ 2.38% 2.56% 2.97°0 2.74% 2.27% 1.92% 2.00% 1% 7 .MARCH 2O18 1A0% -- ------__ - - - - - - - - - - - - - - - - - - �FEBRUARV 2018 .MARCH 2O17 0.00% 701 001, 12 C/" Orange County Sanitation District Liquid Portfolio Summary Account#10282 As of 3/31/2018 PORTFOLIO CHARACTERISTICS ACCOUNTSUMMARY •• 01111110 Beg.Values End Values Issuer %Portfolio Average Duration 0.18 as of 2/28118 as of 3131/18 Government of United States 40.8% Average Coupon 1.44% Market Value 92.555,669 92,748,080 First American Gov(Obligabon 20.6% Average Purchase YTM 1.65% Accrued Interest 189,006 124,180 Federal Home Loan Bank 13.4% Averse Market YTM 1.77% Total Market Value 92,744,674 92,872,260 9 International Finance Corp 2.7 Average S&P/Moody Rating AAA/Aal Income Earned 110,376 126,563 Stale Street Bank 2.3% Average Final Maturity 0.18 yrs Cont/WD 0 Bank of Tokyo-MR UFJ 2.0 Average Life 0.10 yrs Par 92,787,386 92,949,907 Toyota Motor Corp 1.9% Book Value 92,582,480 92,773,869 Deere&Company 1.6 Cost Value 92,514,345 92.676,696 85.3% • - - • • MATURITY DISTRIBUTION US BO% 76.9% AAA (509%) u8 Treasury Corporate (408%) (12.3%) 60% Negotiable Co Commercial (1.1 %) 40% Paper (92%) (2 7%)ational 32.1% (27%) 20% MaE tt% (8.0%) Fund Agency % FI (14.3%) o-.Ps s5-.5 5-1 1-1,5 15 2 2.25 25-3 3* AA (20.6%) Maturity(Yrfl (35.2%) Total Rate of Return J Current Latest Year Annualized Since As of 3/31/2018 Month 3 Months To Date 1 Yr 3 Yra Syria 10 Yra 11130/2014 11/3012014 Orange County Sanitation District Liquid 0.14% 0.35% 0.35% 1.11 % 0.63% N/A N/A 0.59% 1.98% ICE BAML 3-Month US Treasury Bill Index 0.14% 0.35% 0.35% 1.11 % 0.53% N/A N/A 0.48% 1.60% Chandler Asset Management-CONFIDENTIAL Page1 ExecNion Time 201012:30:19M C/" Orange County Sanitation District Long Term Portfolio Summary Account#10268 As of 3/31/2018 PORTFOLIO CHARACTERISTICS ACCOUNTSUMMARY •• aaa� Average Duration 2.41 * Beg.Values End Values Issuer %Portfolio as of 2/28/18 as of 3131/18 Government of United States 31.6% Average Coupon 1.90% Market Value 410,028,408 411,353,114 Federal National Mortgage Assoc 9.6% Average Purchase YTM 1.96% Accrued Interest 1,655,959 1,450,333 Federal Home Loan Bank 8.7% Averse Market YTM 2.42% Total Market Value 411,684,366 412,803,446 9 Federal Home Loan Mortgage Corp 5.3% Average S&P/Moody Rating AA+/Aal Income Earned 615,723 665,393 Inter-American Dev Bank 4.2% Average Final Maturity 2.72 yrs COntIWD 56,798 I First American Gov(Obligabon 2.7% Average Life 2.51 yrs Par 416,214,560 417,366,896 Intl Bank Recon and Development 2.4% Book Value 415,160,505 416,088,322 Bank of Tokyo-Mit UFJ 2.0% I Cost Value 416.061,044 416,484,200 66 3 Y MBS ]0% AA (0.4%) 26.8% (62.5%) US_Carp 25% (19.9%) US Treasury Fa Corp _ (316%) 19.9% %) 20% CP Negotiable CD 15A% (5.1%) (1.4%) 15% 13.5% 3% Mwlcipals Supranational 1D% BBB (1.1%) (7.8%) 7.9% MMF 0.]%) (2.7%) Agency 5% 22% 321 AAA NR CMO (227%) (145%) (8.9%) (0.5%) % A89 o. 11 1s. s 1-1 1 2 1 1 1 1 s s. A Maturity yrs) (13.3%) (6.7%) Total Rate of Return Current Latest Year Annualized Since As of 3/31/2018 Month 3 Months To Date 1 Yr 3 Yrs 5 Yrs 10 Yrs 11/30/2014 11/3012014 Orange County Sanitation District Long Tenn 0.26% -0.33% -0.33% 0.31 % 0.77% N/A N/A 0.88% 2.95% ICE BAML 15 Yr US Carp/Gout Rated AAA-A Index 0.26% -0.45% -0.45% 0.09% 0.66% N/A N/A 0.78% 2.63% ICE BAML US 1-5 Yr US Corp/Govt Rated AAA-BBB Indx 0.23% -0.49% -0.49% 0.22% 0.81 % N/A N/A 0.92% 3.10% Chandler Asset Management-CONFIDENTIAL Paget Execution Time:4 201012:32:59M Orange County Sanitation District Investment Transactions and Balances in the State of California Local Agency Investment Fund March 31, 2018 Par Value Book Value Market Value Rate Yield Balance March 1, 2018 $54,199,172 $54,199,172 $54,199,172 1.52 1.52 Deposits: 3/8/2018 15,700,000 15,700,000 15,700,000 1.52 1.52 Total Deposits 15,700,000 15,700,000 15,700,000 1.52 1.52 Quarterly Interest Distribution 1.52 1.52 Withdrawals: 3/1/2018 (4,900,000) (4,900,000) (4,900,000) 1.52 1.52 3/9/2018 (3,600,000) (3,600,000) (3,600,000) 1.52 1.52 3/14/2018 (1,300,000) (1,300,000) (1,300,000) 1.52 1.52 3/15/2018 (1,900,000) (1,900,000) (1,900,000) 1.52 1.52 3/22/2018 (4,100,000) (4,100,000) (4,100,000) 1.52 1.52 3/27/2018 (800,000) (800,000) (800,000) 1.52 1.52 3/28/2018 (2,500,000) (2,500,000) (2,500,000) 1.52 1.52 3/29/2018 (2,900,000) (2,900,000) (2,900,000) 1.52 1.52 3/30/2018 (400,000) (400,000) (400,000) 1.52 1.52 Total Withdrawals (22,400,000) (22,400,000) (22,400,000) 1.52 1.52 Balance March 31,2018 $47,499,172 $47,499,172 $47,499,172 1.52 1.52 U.S. Bank Asset Summary- Liquid As of 3/31/2018 Industry Name Shares/Units , Cost Basis Market Value Percent of Total Unrealized Gain/Loss Cash Equivalents COMMERCIAL PAPER 7,655,000.0000 7,602,947.58 7,611,404.80 8.21 8,457.22 FIRST AMERICAN SHORT TERM FDS 1,020,282.3900 1,020,282.39 1,020,282.39 1.10 - U. S.GOVERNMENT 15,000,000.0000 14,917,779.86 14,949,600.00 16.13 31,820.14 US AGY-SHORT TERM CASH EQUIV 12,500,000.0000 12,446,623.61 12,462,450.00 13.45 15,826.39 Cash Equivalents Total 36,175,282.3900 35,987,633.44 36,043,737.191 38.901 56,103.75 Fixed Income CONSUMER DISCRETIONARY 1,500,000.0000 1,497,600.00 1,496,895.00 1.62 (705.00) FINANCE 6,899,000.0000 6,913,905.73 6,896,100.16 7.44 (17,805.57) HEALTH CARE 2,000,000.0000 1,996,850.00 1,997,460.00 2.16 610.00 INFORMATION TECHNOLOGY 1,000,000.0000 1,000,150.00 999,230.00 1.08 (920.00) SHORT TERM FUNDS 1,000,000.0000 1,000,000.00 999,030.00 1.08 (970.00) SUPRANATIONAL 2,500,000.0000 2,490,715.00 2,494,450.00 2.69 3,735.00 U. S.GOVERNMENT 41,000,000.0000 40,888,515.64 40,937,470.00 44.18 48,954.36 US AGY-LONG TERM ISSUES 800,000.0000 798,240.00 799,848.00 0.86 1,608.00 Fixed Income Total 56,699,000.0000 56,585,976.37 56,620,483.16 61.10 34,506.79 Grand Total 1 92,874,282.3900 92,573,609.81 92,664,220.351 100.001 90,610.54 1 Of U.S. Bank Asset Summary - Long-Term As of 3/31/2018 Industry Name Shares/UnitsmililL.Cost Basis arket Value Percent of Total Unrealized Gain/Loss Cash Equivalents COMMERCIAL PAPER 21,240,000,0000 21,154,104.50 21,175,762.40 5.15 21,657.90 FIRST AMERICAN SHORT TERM FDS 10,679,606,7200 10,679,606.72 10,679,606.72 2.60 - USAGY-SHORT TERM CASH EOUIV 14,350,000,0000 14,333,607.77 14,338,617.00 3.49 5,009.23 Cash Equivalents Total 46,269,606.7200 46,167,318.98 46,193,986.12 11.24 26,667.13I Fixed Income CONSUMER DISCRETIONARY 4,000,000,0000 4,046,640.00 3,978,440.00 0.97 (68,200.00) ENERGY 8,850,000.0000 8,856,036.90 8,676,201.00 2.11 (179,835.90) FINANCE 46,389,000.0000 46,018,170.07 43,535,593.03 10.59 (2,482,577.04) HEALTH CARE 4,000,000.0000 4,009,675.00 3,981,680.00 0.97 (27,995.00) INDUSTRIAL 5,000,000.0000 5,046,984.00 4,971,400.00 1.21 (75,584.00) INFORMATION TECHNOLOGY 16,710,000.0000 16,706,679.40 16,396,598.35 3.99 (310,081.05) INVESTMENT GRADE-MUNI REVENUE 4,240,000.0000 4,307,633.89 4,427,682.80 1.08 120,D48.91 MTG RELATED SECURITY 27,365,015.2200 27,483,176.09 27,430,327.01 6.67 (52,849.08) SHORT TERM FUNDS 5,825,000.0000 5,825,000.00 5,808,981.25 1.41 (16,018.75) SUPRANATIONAL 37,505,000.0000 37,172,580.25 36,547,887.05 8.89 (624,693.20) U. S.GOVERNMENT 122,308,564.6700 121,124,196.52 119,545,398.63 29.08 (1,578,797.89) U.S. GOVERNMENT TIPS 10,654,584.0000 10,709,864.09 10,604,620.02 2.58 (105,044.07) US AGY-LONG TERM ISSUES 80,365,000,0000 80,096,731.40 78,965,271.60 19.21 (1,131,459.80) Fixed Income Total 373,412,163.8900 371,403,367.61 364,870,280.74 88.76 (6,533.086.87) Grand Total 419,681,770.6100 417,570,686.60 411,064,266.86 100.00 (6,506,419.74) 1 Of >- MELLON slettemMH OP Sod 03/0141/18 TIHOU9R03131IM016 Account OCSQ LIBERTY MUTUAL Statement of Assets Held tows'I Marker Pit co Moroi MI.. AccmJln ecoa, Pal War. Area loweld.. Avarepa Cast Coal Eel Armuatlmcome tYdel YbN RXEDINCOME 3,6W.Ow.W UNITED STATES TREASURY NOTEIEOND 99.97000 3,598,920.00 12,287a6 0.75% CUSIP:WrJa!SN26 99.72266 3,%0,015.63 27,000.00 MATURITY DATE:O<H6i RATE:0.760% MOODY's Au Total FIXED INCOME 3,%8,920.00 12,387.36 0.75% 3,5913,015.63 27,00100 CASH AND SHORT TERM CASH BALANCE 000000 13.500.00 aw 0,00% 0.00000 13.500.00 O.w TOW CASH AND SHORT TERM 13,500A0 0.00 0.0096 13,500.00 aw ACCOUNTTOTALS 3,612,420.00 12,387.36 O.T5% 3,609,615.63 27,000.00 TOW Markel Value Plus TOW Accrued Income 9,624,847.35 Statement of Transactions Tomes m Realised MU 1nwMlen Oawnpllon Inmm. Pxnalya pawl cmnerLc..aa No Transactions This Period TIw Berk OINew Yo Wilonm,utilizesub.1dariea.MelAl'IaiestoprovidewNlwaaWMOWnprotlucNto Me Account. Subatllatlee and affiliates may beoonwhicaMtl for Iher servkpa and products. TDy value of aeouritlpa set pathm this Amount StaNlrNyl we determined by Too Bank of New York Mellon for Corporate Trust an Me basis of market prices and alamatlon aboard by The Banker New YoM Mellon rrom unafllllated INN parties(lrwludir,Independent pdol,vendom)(lhirdperiy rimingparvloo'), The Bankoi New York Mellonhte .Ihi. led eutS.t e1V01W dthn I..Flhntl..Itt. aawra mWilduWccVayoraonehseoriti c. additiveluea market values M Neurtl far In this loRM1 3 mcout Statement maentrelleolnthvalueke mriasand Inormato berto weupon IDeealuofsuyD sear lasho Ina unison the mankel NinesIw secutln or set forth Incols Account badupmaywal oor,the merkelpicasand lad from onim IM party srichng sauced by Mar busucheendster usThe Bank of New York Maim or Its subsidiaries or itsmaffili rkadvaedu wonon Maas peceaaM lnlmmeumrecentmarom forkesof used by,prldnbservss units by eBank rNess orkMess nlls. Gaporete follows. T isNarYork Win loot edby,mrxyl eelllazentmerkelvaluesawedbY,oglerbusinessu of m Bankoi New York Melloror0e Mlmmarlwp Itsdedb th The Benk of New York MellonadfNm In iwanyde win gexpense Incurredsea Mwofor edebl cl . relaletlrotke nlarlst valuesmMwmetlm pwvltletl Dy IMrd pity pdtly9 earvk»e or Ne dlNrelx:Oa In market pricpam Inbmlatlm pwvltlW by MDer ININ pe0y pricing aerAcea. Page 20 2 U.S. Bank Investment Listing -Yield As of 3/31/2018 Asset Category CUSIP Asset Short Name Yield Shares/Units Moody's S&P Rating Price Cost Basis Cash Equivalents 06406XG65 BNY MELLON C P 7106/18 0.0000% 1,000,000.0000 99.39 993,840.00 993,880.00 Cash Equivalents 06538CFD8 BANK OF TOKYO MITSUBIS C P 6/13/18 0.0000% 1,855,000.0000 99.58 1,845,044.83 1,847,134.80 Cash Equivalents 06538CFD8 BANK OF TOKYO MITSUBIS C P 6/13/18 0.0000% 8,240,000.0000 99.58 8,195,778.67 8,205,062.40 Cash Equivalents 21687BJ05 COOPERATIEVE CENTRALE C P 9/24/18 0.0000% 1,500,000.0000 98.82 1,482,252.50 1,482,360.00 Cash Equivalents 313385VE3 F H L B DISC NITS 4106/18 0.0000% 4,350,000.0000 N/A N/A 99.98 4,346,713.33 4,349,217.00 Cash Equivalents 313385VZ6 F H L B DISC NITS 4125/18 0.0000% 2,500,000.0000 N/A N/A 99.89 2,496,723.61 2,497,350.00 Cash Equivalents 313385VZ6 F H L B DISC NITS 4125/18 0.0000% 10,000,000.0000 N/A N/A 99.89 9,986,894.44 9,989,400.00 Cash Equivalents 313385YB6 F H L B DISC NITS 6114/18 0.0000% 10,000,000.0000 N/A N/A 99.65 9,949,900.00 9,965,100.00 Cash Equivalents 31846V567 FIRST AM GOUT OB FD CL Z 1.5358% 1,020,282.3900 100.00 1,020,282.39 1,020,282.39 Cash Equivalents 31846V567 FIRST AM GOVT OB FD CL Z 1.5358% 10,679,606.7200 100.00 10,679,606.72 10,679,606.72 Cash Equivalents 69372BE09 PACCAR FINANCIAL CORP C P 5/24/18 0.0000% 1,500,000.0000 99.721 1,493,293.75 1,495,770.00 Cash Equivalents 69372BE09 PACCAR FINANCIAL CORP C P 5/24/18 0.0000% 5,000,000.0000 99.72 4,977,645.83 4,985,900.00 Cash Equivalents 89233HE75 TOYOTA MOTOR CREDIT CO C P 5/07/18 0.0000% 8,000,000.0000 99.81 7,980,680.00 7,984,800.00 Cash Equivalents 89233HFE9 TOYOTA MOTOR CREDIT CO C P 5/14/18 0.0000% 1,800,000.0000 99.57 1,788,516.50 1,792,260.00 Cash Equivalents 912796PL7 U S TREASURY BILL 6/14/18 1.6443% 15,000,000.0000 N/A N/A 99.66 14,917,779.86 14,949,600.00 Fixed Income 00440EAU1 ACE INA HOLDINGS 2.875% 11/03/22 2.9021% 4,169,000.0000 A3 A 99.07 4,232,453.17 4,130,103.23 Fixed Income 02665WAH4 AMERICAN HONDA MTN 2.250% 8115119 2.2622% 4,000,000.0000 A2 A+ 99.46 4,046,640.00 3,978,440.00 Fixed Income 03215PFN4 AMRESCO 2.8115% 62529 2.9663% 133,143.2900 N/A A+ 94.78 100,432.85 126,761.89 Fixed Income 037833BS8 APPLE INC 2.250% 22321 12.2844%1 4,000,000.0000 AA7 AA+ 98.50 4,050,840.00 3,939,840.00 Fixed Income 06050TMC3 BANK OF AMERICA MTN 1.750% 6/05/18 1.7523 o 1,000,000.0000 AA3 A+ 99.87 999,110.00 998,670.00 Fixed Income 06406HCW7 BANK NY MELLON MTN 2.300% 9/11/19 2.3179% 2,120,000.0000 Al A 99.23 2,142,175.20 2,103,654.80 Fixed Income 06406RAA5 BANK OF NY MTN 2.600% 2/07/22 2.6503% 2,500,000.0000 Al A 98.10 2,504,475.00 2,452,575.00 Fixed Income 06406RAE7 BANK OF NY MTN 2.950% 1/29/23 2.9875% 1,500,000.0000 Al A 98.74 1,486,065.00 1,481,150.00 Fixed Income 06417GXH6 BANK OF NOVA C D 1.570% 8109118 1.5743% 5,825,000.0000 99.73 5,825,000.00 5,808,981.25 Fixed Income 073902CD8 BEAR STEARNS CO INC 4.650% 7/02/18 4.6261% 3,200,000.0000 A3 N/A 100.52 3,523,520.00 3,216,512.00 Fixed Income 084664BEO BERKSHIRE HATH 5.400% 5/15/18 5.3830% 1,000,000.0000 AA2 AA 100.32 1,016,250.00 1,003,150.00 Fixed Income 084664BT7 BERKSHIRE HATHAWAY 3.000% 5/15/22 2.9986% 4,000,000.0000 AA2 AA 100.05 4,131,120.00 4,001,840.00 Fixed Income 166764BG4 CHEVRON CORP 2.100% 5116121 2.1484% 2,500,000.0000 AA2 AA- 97.75 2,485,350.00 2,443,700.00 Fixed Income 17275RAU6 CISCO SYSTEMS INC 1.650% 6115118 1.6513% 1,000,000.0000 Al AA. 99.92 1,000,150.00 999,230.00 Fixed Income 24422ESS9 JOHN DEERE CAP MTN 2.300% 9/16119 2.3132% 5,000,000.0000 A2 A 99.43 5,046,984.00 4,971,400.00 Fixed Income 24422ESX8 JOHN DEERE MTN 1.600% 7113118 1.6033% 1,500,000.0000 A2 A 99.79 1,497,600.00 1,496,895.00 Fixed Income 30231GAV4 EXXON MOBIL 2.222% 3/0121 2.2556% 3,000,000.0000 AAA AA+ 98.51 3,016,097.40 2,955,330.00 Fixed Income 3130A7CV5 F H L B DEB 1.375% 2/18/21 1.4163% 5,365,000.0000 AAA AA+ 97.08 5,343,325.40 5,208,556.60 Fixed Income 3133782M2 F H L B DEB 1.500% 3/08/19 1.5090% 7,500,000.0000 AAA AA+ 99.40 7,589,190.00 7,455,300.00 Fixed Income 313379RB7 F H L B DEB 1.875% 6/11121 t9129% 4,000,000.0000 AAA AA+ 98.02 4,030,160.00 3,920,720.00 Fixed Income 313383HU8 F H L B DEB 1.750% 6112/20 1.7155% 5,000,000.0000 AAA AA+ 98.56 5,008,950.00 4,928,100.00 Fixed Income 3133TCE95 F H L M C MLTCL MTG 3.409% 8/15/32 3.2572% 21,462.6000 104.65 21,485.06 22,462.97 1 of4 U.S. Bank Investment Listing -Yield As of 3/31/2018 Asset Category CUSIP Asset Short Name Yield Shams/Units Moody's S&P Rating Price Cost Basis Market Value Fixed Income 31348SWZ3 F H L M C#786064 3.426% 1/01/28 3.3512% 2,159.2900 N/A N/A 102.23 2,106.72 2,207.46 Fixed Income 3135GOD75 F N M A DEB 1.500% 6/22/20 1.5296% 5,000,000.0000 AAA AA- 98.07 4,955,650.00 4,903,250.00 Fixed Income 3135GOF73 FNMA 1.500% 11/30/20 1.5362% 7,500,000.0000 N/A AA, 97.64 7,370,726.00 7,323,075.00 Fixed Income 3135GOG72 FNMA 1.125% 12/14/18 1.1324% 5,000,000.0000 N/A AA+ 99.35 4,963,950.00 4,967,450.00 Fixed Income 3135GOJ20 F N M A DEB 1.375% 2/26/21 1.4181% 10,000,000.0000 AAA AA, 96.96 10,040,950.00 9,695,900.00 Fixed Income 3135GOS38 FNMA 2.000% 1/0522 2.0415% 3,000,000.0000 AAA AA- 97.97 2,994,570.00 2,938,980.00 Fixed Income 3135GOT45 FNMA 1.875% 4/0522 1.9255% 5,000,000.0000 AAA AA+ 97.38 4,972,500.00 4,868,900.00 Fixed Income 3135GOT94 F N M A DEB 2.375% 1/19/23 2.4052% 3,000,000.0000 AAA AA+ 98.74 2,956,410.00 2,962,290.00 Fixed Income 13137INUC7 F N M A#257179 4.500% 4/01/28 4.2867% 20,414.5200 N/A N/A 104.98 21,590.35 21,430.55 Fixed Income 31376KT22 F N M A#357969 5.000% 9/01/35 4.6304% 129,003.3500 N/A N/A 107.98 138,678.58 139,301.69 Fixed Income 3137EADM8 F H L M C MTN 1.250% 10/02/19 1.2690% 7,500,000.0000 AAA AA+ 98.50 7,399,650.00 7,387,575.00 Fixed Income 3137EAEA3 F H L M C MTN 0.750% 4/09118 0.7501% 800,000.0000 N/A N/R 99.98 798,240.00 799,848.00 Fixed Income 3137EAEK1 F H L M C MTN 1.875% 11/17/20 1.9030% 5,000,000.0000 N/A AA+ 98.53 4,986,225.00 4,926,400.00 Fixed Income 3137EAEL9 F H L M C MTN 2.375% 2/16/21 2.3817% 7,500,000.0000 AAA AA+ 99.72 7,484,475.00 7,478,775.00 Fixed Income 31381PDA3 F N M A#466397 3.51335%11/01/20 3.4601% 349,929.5100 N/A N/A 101.54 12,356.83 355,318.42 Fixed Income 3138EG6FVFN A#AL0869 4.500% 6/01/29 4.2858% 13,828.0600 N/A N/A 105.0014,624.54 14,519.19 Fixed Income 31394JY35 M C MLTCL MTG 6.500% 9/25/43 5.7869% 860,507.7100 N/A N/A 112.32 974,524.97 966,548.08 Fixed Income 31397ORE A GTD REMIC 1.113% 2/25/41 2.5034% 247,845.1500 N/A N/A 101.92 247,767.70 252,603.78 Fixed Income 31398VJ98 M C MLTCL MTG 4.251% 1/25/20 4.1499% 900,000.0000 N/A N/A 102.44 951,046.88 921,915.00 Fixed Income 31403DJZ3 F N M A#745580 5.000% 6/01/36 4.6313% 124,703.4000 N/A N/A 107.96 134,056.17 134,631.04 Fixed Income 31403GXF4 F N M A#748678 5.000%10/01/33 4.6664% 2,826.3200 N/A N/A 107.15 3,038.29 3,028.35 Fixed Income 31406POY8 F N M A#815971 5.000% 3/01/35 4.6300% 217,603.3700 N/A N/A 107.99 233,923.64 234,992.06 Fixed Income 31406XWT5 FNMA#823358 3.484% 2/01/35 3.3320% 130,299.2000 N/A N/A 104.55 129,281.25 136,242.15 Fixed Income 31407BXH7 F N M A#826080 5.000% 7/01/35 4.6286% 23,990.8500 N/A N/A 108.03 25,790.14 25,916.12 Fixed Income 31410F4V4 F N M A#888336 5.000% 7/01/36 4.6315% 241,739.6400 N/A N/A 107.96 259,870.12 260,974.86 Fixed Income 31417YAY3 F N M A#MA0022 4.500% 4/01/29 4.2860% 22,859.8800 N/A N/A 104.99 24,176.55 24,001.50 Fixed Income 36225CAZ9 G N M A 11#080023 3.125%122026 3.0350% 20,803.1500 N/A N/A 102.97 21,146.85 21,419.96 Fixed Income 36225CC20 G N M A 11#080088 2.625% 6/20/27 2.5343% 22,266.2100 N/A N/A 103.58 22,753.30 23,062.67 Fixed Income 36225CN28 G N M A 11#080408 2.625% 5/20/30 2.5346% 67,248.7300 N/A N/A 103.57 66,555.75 69,648.16 Fixed Income 36225CNM4 G N M A 11#080395 2.625% 4/20/30 2.5350% 8,564.6700 N/A N/A 103.55 8,487.03 8,868.63 Fixed Income 36225DCB8 G N M A 11#080965 2.750% 7/20/34 2.6486% 65,741.8100 N/A N/A 103.83 65,700.73 68,258.41 Fixed Income 36962G7MO GENERAL ELEC CA MTN 2.200% 1/09/20 2.2342% 5,000,000.0000 A2 A 98.47 5,014,950.00 4,923,550.00 Fixed Income 3837H4NX9 IG N M A GTD REMIC 2.286% 2/16/30 2.2777% 17,157.3500 N/A N/A 100.37 17,157.35 17,220.15 Fixed Income 404280BF5 HSBC HOLDINGS PLC 2.650% 1/05/22 2.7255% 4,500,000.0000 A2 A 97.23 4,429,980.00 4,375,305.00 Fixed Income 40428HPJ5 HSBC USA INC 2.625% 924118 2.5254% 619,000.0000 A2 A 99.98 620,281.33 618,900.96 Fixed Income 40428HPR7 HSBC USA INC MTN 2.350% 3/05/20 2.3812% 2,500,000.0000 A2 A 98.69 2,472,287.50 2,467,250.00 Fixed Income 43814PAB6 HONDAAUTO 1.570% 1/21/20 1.5778% 985,000.0000 N/A AAA 1 99.51 964,914.21 960,223.25 2 of4 U.S. Bank Investment Listing -Yield As of 3/31/2018 Asset Category CUSIP Asset Short Name Yield Shams/Units Moody's S&P Rating Price Cost Basis Market Val Fixed Income 43814QAC2 HONDAAUTO 1.390% 4/15/20 1.3982% 1,381,783.2100 AAA N/A 99.42 1,381,756.41 1,373,699.78 Fixed Income 43814RACO HONDAAUTO 1.210%12/18/20 1.2261% 2,875,000.0000 N/A AAA 98.69 2,843,442.38 2,837,337.50 Fixed Income 43814TAB8 HONDAAUTO 1.420% 7/22/19 1.4237% 820,760.6600 AAA N/A 99.741 820,741.04 818,651.31 Fixed Income 44932HAH6 IBM CREDIT CORP 3.000% 2/06/23 3.0319% 4,665,000.0000 Al A. 98.95 4,619,258.85 4,615,877.55 Fixed Income 4581XOCS5 INTER AMERICAN DEVEL 1.875% 3/15/21 1.9111% 5,000,000.0000 AAA AAA 98.11 5,059,610.00 4,905,550.00 Fixed Income 4581XOCW6 INTER AMER DEV BK 2.125% 1/18/22 2.1618% 3,000,000.0000 AAA N/A 98.30 2,996,310.00 2,948,880.00 Fixed Income 4581XOCX4 INTER AMER DEV BK 1.625% 5/12/20 1.6492% 3,035,000.0000 AAA AAA 98.54 3,027,807.05 2,990,537.25 Fixed Income 4581XOCZ9 INTER AMER DEV BK 1.750% 9/14/22 1.8199% 6,500,000.0000 N/A N/A 96.16 6,249,655.00 6,250,400.00 Fixed Income 459058FY4 INTL BK 2.000% 12622 2.0516% 10,000,000.0000 AAA N/A 97.48 10,006,350.00 9,748,400.00 Fixed Income 45950KBX7 INTL FINANCE CORP 0.875% 6/15/18 0.8769% 2,500,000.0000 AAA AAA 99.78 2,490,715.00 2,494,450.00 Fixed Income 45950KCJ7 INTL FINANCE CORP 1.125% 7/20/21 1.1802% 2,500,000.0000 AAA AAA 95.32 2,441,600.00 2,383,050.00 Fixed Income 45950KCMO INTL BK M T N 2.250% 1/25/21 2.2685% 2,970,000.0000 AAA AAA 99.18 2,961,268.20 2,945,764.80 Fixed Income 146625HJL5 JPMORGAN CHASE CO 1.625% 5/15/18 1.6267% 1,250,000.0000 A3 A- 99.90 1,249,525.00 1,248,712.50 Fixed Income 46625HKA7 JPMORGAN CHASE CO 2.250% 1/23/20 2.2777% 2,000,000.0000 A3 A- 98.79 1,994,880.00 1,975,700.00 Fixed Income 47787XAB3 JOHN DEERE OWNER 1.500%10/15/19 1.5041% 934,696.1900 AAA N/A 99.73 934,692.45 932,135.12 Fixed Income 47788BABO JOHN DEERE OWNER 1.590% 4/15/20 1.5974% 878,180.8200 AAA N/A 99.54 878,104.51 874,106.06 Fixed Income 47788BAD6 JOHN DEERE OWNER 1.820%10/15/21 1.8480% 675,000.0000 AAA N/A 98.49 674,950.59 664,780.50 Fixed Income 47788CABB JOHN DEERE OWNER 2.420%10/15/20 2.4247% 1,800,000.0000 AAA N/A 99.81 1,796,343.75 1,796,508.00 Fixed Income 47788CAC6 JOHN DEERE OWNER 2.660% 4/18/22 2.6642% 1,340,000.0000 AAA N/A 99.84 1,339,903.65 1,337,869.40 Fixed Income 47788MAC4 JOHN DEERE OWNER 1.360% 4/15/20 1.3678% 1,654,824.6900 AAA N/A 99.43 1,654,564.23 1,645,342.54 Fixed Income 525ESCOY6 LEHMAN BIRTH HLD ESC 0.0000% 2,000,000.0000 1,070,782.46 Fixed Income 525ESCIB7 LEHMAN BIRTH MTN ES 0.00001% 1/24/13 0.0002% 600,000.0000 N/A N/A 4.05 331,903.74 24,300.00 Fixed Income 532457BF4 ELI LILLY CO 1.950% 3/15119 1.9590%1 4,000,000.0000 A2 AA. 99.54 4,009,675.00 3,981,680.00 Fixed Income 58933YAGO MERCK CO INC 1.300% 5/18/18 1.3015% 1,000,000.0000 Al AA 99.88 998,880.00 998,830.00 Fixed Income 594918BP8 MICROSOFT CORP 1.550% 8/08/21 1.6142% 3,045,000.0000 AAA AAA 96.02 3,041,385.15 2,923,930.80 Fixed Income 61747WAL3 MORGAN STANLEY 5.500% 7/28/21 5.1495% 2,800,000.0000 A3 BBB. 106.81 3,200,848.00 2,990,568.00 Fixed Income 64971M5E8 NEWYORKNYCITY 4.075% 11/01/20 3.9331% 1,400,000.0000 AAI AAA 103.61 1,400,000.00 1,450,526.00 Fixed Income 654747ABO NISSAN AUTO 1.470% 1/1520 11.4762% 940,656.5900 AAA N/A 99.58 940,651.79 936,677.61 Fixed Income 65477UAD2 NISSAN AUTO 1.500% 9/1521 11.5111%1 1,800,000.0000 AAA N/A 99.26 1,788,750.00 1,786,752.00 Fixed Income 65478VAD9 NISSAN AUTO 1.320% 1/1521 1.3333% 2,000,000.0000 AAA N/A 99.00 1,983,984.38 1,980,020.00 Fixed Income 65478WAB1 NISSAN AUTO 1.070% 5/15/19 1.0704% 298,556.1100 AAA N/A 99.97 298,544.35 298,451.62 Fixed Income 674599CK9 OCCIDENTAL PETROLEUM 2.600% 4/15/22 2.6578% 3,350,000.0000 A3 A 97.83 3,354,589.50 3,277,171.00 Fixed Income 69353RFB9 IPNC BANK NA MTN 2.625% 211722 2.6843% 1,000,000.0000 A2 A 97.79 974,940.00 977,910.00 Fixed Income 717081DW0 I PFIZER INC 1.200% 6/01/18 1.2016% 1,000,000.0000 Al AA 99.861 997,970.00 998,630.00 Fixed Income 73358WAG9PORT AUTH NY NJ 5.309% 12/01/19 5.0817% 2,440,000.0000 AA3 AA- 104.47 2:507,8333 2,549,118.80 Fixed Income 747525AD5 QUALCOMM INC 2.250% 5/20/20 2.2880% 5,000,000.0000 Al A 98.34 4,995,195.40 4,916,950.00 Fixed Income 78012UAX3 ROYAL BK OF C D 2.320%1127/18 2.3223% 1:000,000.000,0 99.90 1,000,000.00 999,030.00 3 of U.S. Bank Investment Listing -Yield As of 3/31/2018 Asset Category CUSIP Asset Short Name Yield Shares/Units Moody's S&P Rating Price Cost Basis Fixed Income 78445JAA5 5 L M A 2.93114% 4/25/23 2.8720% 29,180.7100 BAA3 AA, 102.06 29,062.32 29,781.25 Fixed Income 808513AJ4 CHARLES SCHWAB CORP 2.200% 7/25/18 2.2007% 930,000.0000 A2 A 99.97 931,841.40 929,711.70 Fixed Income 83162CLJO S B A GTD DEV PART 6.340% 3/01/21 6.1203% 39,115.3600 N/A N/A 103.59 39,115.36 40,519.21 Fixed Income 857477AK9 STATE STREET CORP 1.350% 5/15/18 1.3520% 2,100,000.0000 Al A 99.86 2,096,898.00 2,096,955.00 Fixed Income 89236WAC2 TOYOTA AUTO 1.120% 2/15/19 1.1202% 126,127.4900 AAA AAA 99.98 126,108.42 126,101.00 Fixed Income 89238BAB8 TOYOTA AUTO 2.100% 10/15/20 2.1086% 5,170,000.0000 AAA AAA 99.59 5,169,471.63 5,148,906.40 Fixed Income 90331HNL3 US BANK NA MTN 2.850% 1/23/23 2.8867% 5,000,000.0000 Al AA. 98.73 4,981,600.00 4,936,350.00 Fixed Income 912828833 U $TREASURY NT 1.500% 1/31/19 1.5077% 11,000,000.0000 AAA N/A 99.49 11,042,439.19 10,944,120.00 Fixed Income 912828F39 U S TREASURY NT 1.750% 9/30/19 1.7626% 5,800,000.0000 AAA N/A 99.29 5,873,186.87 5,758,530.00 Fixed Income 912828G61 U $TREASURY NT 1.500% 11/30/19 1.5187% 7,500,000.0000 AAA N/A 98.77 7,449,634.50 7,407,750.00 Fixed Income 912828J76 U S TREASURY NT 1.750% 3/3122 1.8009% 5,000,000.0000 AAA N/A 97.17 4,976,383.94 4,858,600.00 Fixed Income 9128281-24 U S TREASURY NT 1.875% 8/3122 1.9278% 6,000,000.0000 AAA N/A 97.261 5,987,832.601 5,835,720.00 Fixed Income 9128281-57 U S TREASURY NT 1.750% 9/3022 1.8105% 13,000,000.0000 AAA N/A 96.66 12,763,554.69 12,565,800.00 Fixed Income 9128281-99 U S TREASURY NT 1.375% 10/31/20 1.4099% 10,000,000.0000 AAA N/A 97.52 9,850,311.40 9,752,300.00 Fixed Income 912828M80 U S TREASURY NT 2.000% 11/30/22 2.0489% 8,000,000.0000 AAA N/A 97.61 7,907,500.00 7,809,040.00 Fixed Income 912828N30 U S TREASURY NT 2.125% 12/31/22 2.1667% 5,000,000.0000 AAA N/A 98.07 4,926,562.50 4,903,700.00 Fixed Income 912828N89 U S TREASURY NT 1.375% 1/3121 1.4143% 6,000,000.0000 AAA N/A 97.22 5,895,840.41 5,833,380.00 Fixed Income 912828045 U $TREASURY NT 0.875% 3/31/18 0.8750% 13,000,000.0000 W R N/A 100.00 12,981,523.44 13,000,000.00 Fixed Income 912828568 U $TREASURY NT 0.750% 7/31/18 0.7527% 15,000,000.0000 AAA N/A 99.65 14,932,226.57 14,946,750.00 Fixed Income 912828SN1 U $TREASURY NT 1.500% 3/31/19 1.5094% 5,000,000.0000 AAA N/A 99.38 5,016,423.00 4,968,950.00 Fixed Income 912828T34 U S TREASURY NT 1.125% 9/3021 1.1777% 7,000,000.0000 AAA N/A 95.53 6,757,914.08 6,686,890.00 Fixed Income 912828T67 U S TREASURY NT 1.250% 10/31/21 1.3043% 6,000,000.0000 AAA N/A 95.84 5,813,691.98 5,750,400.00 Fixed Income 912828U65 U S TREASURY NT 1.750% 11/30/21 1.7957% 7,000,000.0000 AAA N/A 97.45 6,900,492.20 6,821,710.00 Fixed Income 912828UU2 U $TREASURY NT 0.750% 3131118 0.7500% 5,000,000.0000 WR N/A 100.00 4,991,015.63 5,000,000.00 Fixed Income 912828V72 U S TREASURY NT 1.875% 1/3122 1.9185% 3,000,000.0000 AAA N/A 97.73 3,004,814.74 2,932,020.00 Fixed Income 912828VE7 U $TREASURY NT 1.000% 5/31/18 1.0012% 8,000,000.0000 AAA N/A 99.88 7,983,750.00 7,990,720.00 Fixed Income 912828WS5 U $TREASURY NT 1.625% 6/30/19 1.6362% 2,000,000.0000 AAA N/A 99.32 1,996,861.44 1,986,320.00 Fixed Income 912828WUO U S TREASURY I P S 0.125% 7/15/24 0.1279% 10,854,584.0000 AAA N/A 97.70 10,709,864.09 10,604,820.02 Fixed Income 912828W W U S TREASURY NT 1.625% 7/31/19 1.6373% 5,000,000.0000 AAA N/A 99.25 51012,388.70 41962,500.00 Fixed Income 912828XE5 U S TREASURY NT 1.500% 5/3120 1.5266% 5,000,000.0000 AAA N/A 98.26 4,966,423.00 4,912,900.00 Fixed Income 912828XW 5 U S TREASURY NT 1.750% 6/3022 1.8057% 5,000,000.0000 AAA N/A 96.92 4,973,454.25 4,845,900.00 Fixed Income 913366EJ5 UNIV OF CALIFORNIA 5.035% 5/1521 4.7052% 400,000.0000 AA3 AA. 107.01 400,000.00 428,040.00 Fixed Income 94974BGM6 WELLS FARGO CO MTN 2.600% 72220 2.6251% 5,000,000.0000 A2 A- 99.05 5,001,650.00 4,952,250.00 Fixed Income 95000U2B8 WELLS FARGO MTN 2.625% 72222 2.7138% 3,000,000.0000 A2 A- 96.73 2,954,520.00 2,901,870.00 Total Consolidated I 1 503,728,487.21 4of4 U.S. Bank Asset Detail - Consolidated As of 3/31/2018 CUSIP Asset Short Name Price Shams/Units Cost Basis Market Value Percent of Total Urmalh:ed Galr&oss Cash Equivalents 06406XG65 BNV MELLON C P 7/06I18 99.39 1,000,000,0000 993,840.00 993,880,00 0.20 40,00 06538CFD8 BANK OF TOKYO MITSUBIS C P 6/13/18 99.58 1,855p0O0000 1,845,044.83 1,84T,134.80 0.37 2,089.97 06538CFD8 BANK OF TOKYO MITSUBIS C P 6/13I18 99.58 8,240,000,0000 8,195,]]8.67 8,205,062,40 1.63 9,283.73 216876JO5 COOPERATIEVE CENTRALE C P 9124/18 98.82 1,500,000,0000 1,482,252.50 1,482,36000 0.29 107.50 313385VE3 F H L B DISC NTS 4/06I18 99.98 4,350,000.0000 4,346,713.33 4,349,217,00 0.86 2,503.67 313385VZ6 F H L B DISC NTS 4/25118 99.89 2,500,000.0000 2,496,723.61 2,497,350,00 0.50 626.39 313385VZ6 F H L B DISC NTS 4 5118 99.89 10,000,000,0000 9,986,894.44 9,989,400.00 1.98 2,505.56 313385Y66 F H L B DISC NTS 6/14118 99.65 10,000,000,0000 9,949,900.00 9,965,100.00 1.98 15,200,00 31846V567 FIRST AM GOUT OB FD CL Z 100.00 1,020,282,3900 11020,282.391 11020,282.39 0.20 - 31846V567 FIRST AM GOVT OB FD CL Z 100.00 10,679,60 ,7200 10,6]9,606.]2 10,179,606,72 2.12 - 69372BEO9 PACCAR FINANCIAL CORP C P 5/24I18 99.72 1,500,000.0000 1,493,293]5 1,495,]]0,00 0.30 2,476,25 69372BEO9 PACCAR FINANCIAL CORP C P 5/24I18 99.72 5,000,000,0000 4,977,645.83 4,985,900,00 0.99 8,254.17 89233HE75 IT OVOTA MOTOR CREDIT COCP 5I07/18 99.81 8,000,000.0000 7,980.880.00 7,984,800.00 1.59 4,12000 89233HFE9 TOVOTA MOTOR CREDIT CO C P 6114/18 99.57 1,800p0O0000 1,78' 1,]92,260,00 0.36 ,743.50 99.6 15,000,000.0000 14 8 149912]96PV US TREASURY BILL 6/14118 ,91],]] 9,600.00 2.97 31,820A4 Cash Equivalents Total 82,444,889.1100 82,154,952.43 82,237,723.31 16.33 82,T10.88 Fixed Income ii I00440EAU1 ACE INA HOLDINGS 2.875%11/03/22 99.07 4,169,000.0000 4,232A53.17 4,130,103.23 0.82 (102,349.94) 02665WAH4 AMERICAN HONDA MTN 2.250% 8115119 99.46 4,000p0O0000 4,046,640.00 3,978,440.00 0.79 (68,200,00) 03215PFN4 AMRESCO 2.38996% 6125129 94.78 133,743,2900 100,432.85 126,761.89 0.03 26,329,04 0378336SB APPLE INC 2.250% 2123121 98.50 4,000,000,0000 4,050,840.00 3,939,940.00 0.78 (111,000,00) 06050TMC3 BANK OF AMERICA MTN 1.750% 6105118 99.87 1,000,000,0000 9%,110.00 998,670.00 0.20 (440.00) 06406HCW7 BANK NY MELLON MTN 2.300% 9/11119 99.23 2,120, 0O0000 2.142,175.20 2,103,654.80 0.42 (38,520.40) 06406RAA5 BANK OF NV MTN 2.600% 2/07/22 98.10 2,500,000.0000 2,504,475.00 2,452,575.00 0.49 (51,900.00) 06406RAE7 BANK OF NV MTN 2.950% 1129/23 98.74 1,500p0O0000 1,486,065.00 1,481,160.00 0.29 (4,905.00) 06417GXH6 BANK OF NOVA CD 1.570% 8109/18 99.73 5,825,000.0000 5,825,000.00 5,808,981,25 1.15 (16,018.75) 073902CD8 BEAR STEARNS CO INC 4.650% 7102118 100.52 3,200,000,0000 3,523,520.00 3,216,512,00 064 (307,008.00) 084664BEO BERKSHIRE HATH 5.400% 5/15118 100.32 1,000,000,0000 1,016,250.00 1,003,150,00 0.20 (13,100.00) 084664BT7 BERKSHIRE HATHAWAY 3.000% 5115122 100.05 4,000,000,0000 4,131,120.00 4,001,84000 0.79 (129,280.00) 1667646G4 CHEVRON CORP 2.100% 5/16121 9].]5 2,500,000.0000 2,485,350.00 2,643,700.00 0.49 (41,650.00) 17275RAU6 CISCO SYSTEMS INC 1.650% 6115118 99.92 1,000,000,0000 1,000,150.00 999,230,00 0,20 (920.00) 24422ESS9 JOHN DEERE CAP MTN 2.300% 9116/19 99.43 5,000,000,0000 5,046,984.00 4,971,400,00 0A9 (75,584.00) 24422ESXB JOHN DEERE MTN 1.600% 7113118 99.79 1,500,000,0000 1,497,600.00 1,496,895.00 0.30 (705.00) 30231GAV4 EXXON MOBIL 2.222% 3/01/21 98.51 3,000,000,0000 3,016,097.40 2,955,330.00 0.59 (60,76].40) 3130A7CV5 F H L S DEB 1.375% 2118121 e].08 5,365p0O0000 5,343,325.40 5,208,556.60 1,03 (134,768.80) 3133782M2 F H LB DEB 1.500% 3/08119 99.40 7,500,000.0000 7,589,190.00 ],655,300.00 1 48 (133,890.00) 313379RB7 F H L S DEB 1.875% 6/11121 9802 4,000p0O0000 4,030,160.00 3,920,]20.00 0,78 (109,440.00) 313383HU8 F H LB DEB 1.750% 6/12120 98.56 5,000,000.0000 _5,008,950.00 4,928,100.00 0.98 (80,850.00) 3133TCE95 F H L M C MLTCL MTG 3.409% 8115132 104.66 21,462,6000 21A85.06 22,462.9] 0.00 971.91 313485WZ3 FH LM C M786064 3.426% 1/01128 --lN.231 ,159,2900 2,106.72 2,20].48 0.00 100.74 1 of U.S. Bank Asset Detail - Consolidated As of 3/3 112 01 8 CUSIP I Asset Shod Name Prim Shares/Units Cost Basis Market Value PeruM of Total Unrealized GalnlLoss 3135GOD75 F N M A DEB 1, W% 612220 98.07 5,000,000,0000 4,955,650.00 4,903,250,00 0.97 (52,400.00) 3135GOF73 FNMA 1.500%11130/20 97.64 7,500,000,0000 7,370,726.00 7,323,075,00 1.45 (47,651.00) 3135GOG72 FNMA 1.125%12H4/18 99.35 5,000,000,0000 4,963,950.00 4,967,450,00 0.99 3,500,00 3135GOJ20 F N M A DEB 1.375% 2/26/21 98.96 10,000,000.0000 10,040,950.00 9,695,900,00 1.92 (345,050.00) 3135GOS38 FNMA 2.000% 1/0522 9].9] 3,000,W0,0000 2,994,570.00 2,938,980,00 0.58 (55,590.00) 3135GOT45 FNMA 1.875% 4105/22 97.38 5,000,000.0000 4,972,500.00 4,868,900,00 0.97 (103,600.00) 3135GOT94 FN MA DEB 2.375% 111923 98.74 3,000,00D.0000 2,956,410.00 2,962,290,00 0.59 5,880,00 31371NUC7 FN MA#25]1]9 4.500% 410128 104.98 20,414,5200 21,590.35 21,430.55 0.00 (159.80) 31376KT22 FN MA#357969 5.000% 9101/35 107.96 129,003,3500 138 678 58 139,301.691 0,03 623,11 3137EADMB F H L M C MTN 1.250%10102/19 98.50 7,500,000.0000 7,399:650:00 7,387,575.00 1 47 (12,075.00) 3137EAEA3 F H L M C MTN 0.750% 4109118 99.98 800,000,0000 798,240.00 ]99,848.00 0,16 1,608.00 3137EAEK1 F H L M C MTN 1.875%1111720 98.53 5,000,000,0000 4,9156,225.001 4,928,400,00 0.98 (59,825.00) 3137EAEL9 F H L M C MTN 2.375% 2116121 99.72 7,500,000,0000 7,484,475.00 7,478,775,00 1,48 (5,700.00) 31381PDA3 FN MAN66397 3.51335%11/01/20 101.54 349,929,5100 342,356.83 355,318.42 0.07 12,961.59 3138EG6F6 FN MA#AL0869 4.500% 610129 105.001 13,828,0600 14,624.54 14,519.19 0.00 ( 31394JY35 F H L M C MLTCL MTG 6.500% 9125143 112.32 880,50].]100 974,524.9] 966,548.08 0.19 (7,976.89) 31397OREO FN MA GTD REMIC 1.113% 2125141 101,92 247,845.1500 247,767.70 252,603]8 0.05 4,836,08 31398VJ98 F H L M C MLTCL MTG 4.251% 112520 102.44 900,000,0000 951,046.88 921,915.00 0.18 (29,131.88) 31403DJZ3 FNMA#745580 5.000% 6101/36 107.96 124,703,4000 134,056.17 134,631.04 0,03 5]4,8] 31403GXF4 F N M A#748678 5.000%10/01/33 107.15 2,826,3200 3,038.29 3,028.35 0.00 (9.94) 31406PQYB FN MA#815971 5.000% 3101135 107.99 217,603,3700 233,923.64 234,992.06 0.05 1,068,42 31406MT5 F N M A#823358_3.484% 2/O1/35 104.56 130,299.2000 32n2,753.30 5 136,242.15 0.03 6,960,90 31407BXH7 FN MA#826080 5.000% 7101/35 108.03 23,990.850014 25,916.12 0.01 125,98 3141 OF4V4 FN MA#888336 5.000% 7101/36 107.96 241,739,6400 12 280,974.88 0.05 1,104.74 31411VAV3 F N M A#MA0022 4.500% 4101129 104.99 22,859,880055 24,001.50 0.00 (175.05) 36225CAZ9 G N M A 11#0800233.125%IM0126 102.97 20,803,150085 21,419.98 0.00 273,11 36225CC20 G N M A I 1#080088 2.625% 612027 103.58 22,266.210030 23,%2.6] 0.00 309,3] 36225CN28 GNMA II#08W082.625% 5/20/30 103.5] 67,248,730075 69,648.16 0.01 3,082,41 36225CNM4 GNMA 11#0803952.625% 4120130 103.55 8,564.6]0003 8,868,63 0.00 381,60 36225DCB8 G N M A 11#080965 2.750% 7120/34 103.83 65,741,8100 65,700.73 68,258,41 0.01 2,557,68 36962G7MO GENERAL ELEC CA MTN 2.200% 110920 98.47 5,000p000000 5,014,950.00 4,923,550,00 0.98 (91,400.00) 3837H4NX9 GN MA GTD REMIC 2.286% 2116130 100.37 17,157,3500 17,157.35 17,220.15 0.00 62,80 404280BF5 HSBC HOLDINGS PLC 2.650% 110522 97.23 4,500,000.0000 4,429,980.00 4,375,305,00 0.87 (54,675.00) 40428HPJ5 HSBC USA INC 2.625% 924118 99.98 619,000.0000 620,281.33 618,900,96 0.12 (1,380.37) 40428HPR7 HSBC USA INC MTN 2.350% 310520 98.69 2,500p00.0000 2,472,287.50 2,46],250.00 0.49 (5,037.50) 43814PA38 IHONDAAUTO 1.5]0% 1/2120 99.51 965,000,0000 964,914.21 960,223.25 0.19 (4,690.96) 43814OAC2 HONDAAUTO AUTO 1.390% 411520 99.42 1,381,783,2100 1,381,756.41 1,373,69918 0.27 (8,056.63) 43814RACO HONDAAUTO 1.210%12/18/20 98.69 2,875,000.0000 2,843,442.38 2,837,337,50 0.56 (6,104.88) 43814TABB HONDAAUTO 1.420% 1/22/19 99.74 820,760,6600 820,741.04 818,651,31 0.16 (2,089.73) 44932HAH6 IBM CREDIT CORP 3.000% 2/06123 98.95 4,665,000.0000 4,619,258.85 4,615,8]].55 0.92 (3,381.30) 4581XOCS5 INTER AMERICAN DEVEL 1.875% 311521 98.11 5,000,000,0000 5,059,610.00 4,905,550.00 0.9] (154,060.00) 4581XOCW6 INTER AMER DEV BK 2.125% 1/18122 98.30 3,000,000,0000 2,996,310.00 2,948,880.00 0.59 (47,430.00) 2 oI4 U.S. Bank Asset Detail - Consolidated As of 3/31/2018 CUSIP Asset Short Name Prim Shams/Units Cost Basis Market Value PeruM of Total Unrealized GalnlLoss 4581XOCX4 INTER AMER DEV BK 1.6250A 5/12120 98.54 3,035,000,0000 3,027,807.05 2,990,537,25 0.59 (37,269.80) 4581XOCZ9 INTERAMERDEVBK 1.750% 9/14122 96.16 6,500,000,0000 6,249,655.00 6,250,400,00 1.24 745,00 459058FY4 INTL BK 2.000% 112622 97.48 10,000,000,0000 10,006,350.00 9,748,400,00 1.94 (257,950.00) 45950KBV INTL FINANCE CORP 0.875% 6115118 99.78 2,500,ODD.0000 2,490,715.00 2,494,450.00 0.50 3,735,00 45950KCJ7 INTL FINANCE CORP 1.125% 7I20/21 95.32 2,500p000000 2,441,600.D0 2,383,050.00 0.47 (58,5 .W) 45950KCMO INTL BK MTN 2.250% 1/25/21 99.18 2,970,000,0000 2,961,268.20 2,945,764.80 0.58 (15,503.40) 46625HJL5 JPMORGAN CHASE CO 7.625% 5/15/18 99.90 1,250,0000000 1,249,525.00 1,248,772.50 0.25 (812.50) 46625HKA7 J PMORGAN CHASE CO 2.250% 1/23/20 98.79 2,000,000,0000 1,994,880.00 1,975,700.00 0.39 (19,180.00) 47787XA83 JOHN DEERE OWNER 1.5000/,10/15/19 91.73 934,696.1900 934,692.45 932,135.12 0.19 (2,557.33) 47788BMO JOHN DEERE OWNER 1.590% 4/15/20 99.54 878,180,8200 878,104.51 874,iD6.06 0.17 (3,998.45) 47788BAD6 JOHN DEERE OWNER 1.820%10115/21 98.49 675,000.0000 674,950.59 664,780.50 0.13 (10,170.09) 47788CAB8 JOHN DEERE OWNER 2.420%10115/20 99.81 1,800,ODD.0000 1,796,343.75 1,796,508.00 0.36 164.25 47788CAC6 JOHN DEERE OWNER 2.660% 4/18/22 99.84 1,34QW00000 1,339,903.65 1,337,869.40 0.27 (2,034.25) 47788MAC4 JOHN DEERE OWNER 1.360% 4/15120 99.43 1,654,824,6900 1,654,564.23 1,645,342.54 0.33 (9,221.69) 525ESCOY6 LEHMAN BRTH HLD ESC - 2,000,000,0000 1,070,782.46 - - (1,O70,782.46) 525ESCIB7 LEHMAN BIRTH MTN ES 0.00001% 1/24/13 4.05 600,000,0000 331,903.74 24,300.00 0.00 (307,603.74) 532457BF4 ELI LILLY CO 1.950% 3/15119 99.54 4,000p000000 4,009,6T5.00 3,981,680.00 0.19 (27,995.00) 58933YAGO MERCK CO INC 1.300% 5/18118 99.88 1,000,000,0000 998,880.00 998,830.00 0.20 (50.00) 594918BP8 MICROSOFT CORP 1.550% 81OB121 96.02 3,045p000000 3,041,385.15 2,923,930.80 0.58 (117,454.35) 61747WAL3 MORGAN STANLEY 5.500% 7128121 106.81 2,800,000,0000 3,200,848.00 2,990,568.00 0.59 (210,280.00) 64971M5E8 NEWYORKNYCITY 4.075%11/01/20 103.61 1,400, 000000 1,400,000.00 1,450,526.00 0.29 50,526,00 654747MO NISSAN AUTO 1.470% 1115/20 99.58 940,656,5900 940,651.79 936,677.61 OA9 (3,974A8) 65477UAD2 NISSAN AUTO 1.500% 911521 99.26 1,800,0000000 1,788,750.00 1,786,752,00 0,35 (1,998,00) 65478VAD9 NISSAN AUTO 1.320% 1/1521 99.00 2,000,000,0000 1,983,984.38 1,980,020.00 0.39 (3,964.38) 6547eWA61 NISSAN AUTO 1.070% 5115/19 99.97 298,556,1100 298,544.35 298,451.62 0,06 (92.73) 674599CK9 OCCIDENTAL PETROLEUM 2.600% 4/15122 97.83 3,350,000,0000 3,354,589.50 3,277,171.00 0.65 (77,418.50) 69353RFB9 PNC BANK NA MTN 2.625% 211722 97.79 1,000,000,0000 974,940D0 977,910,00 0,19 2,91000 717081DWO PFIZER INC 1.200% 6/01118 99.86 1,000,000,0000 997,970.00 99_8,630,00 0.20 660,00 73358WAG9 PORT AUTH NY NJ 5.309%12101119 104.47 2,440,000,0000 2,507,633.89 2,549,116,80 0.51 41,482,91 747525AD5 DUALCOMM INC 2.250% 5/20/20 98.34 5,000,000,0000 4,995,195.40 4,916,950.00 0.98 (78,245.40) 78012UAX3 ROYAL SK OF CD 2.320%1127118 99.90 1,000,000,0000 1=,000.00 999,030.00 0.20 (970.00) 78445JAA5 S L M A 2.93114% 425123 102.06 29,180,7100 29,062.32 29,781.25 0.011 718,93 808513AJ4 CHARLES SCHWAB CORP 2.200% 7125118 99.97 930,00,0000 931,841.40 929,711,70 0.18 (2,129.7O) 83162CUO SB A GTD DEV PART 6.340% 3/01121 103.59 39,115,3600 39,115.36 40,519,21 0.01 1,403.85 857477AK9 STATE STREET CORP 1.3500A 5/15118 99.86 2,100,00,0000 2,096,898.00 2,096,95500 0.42 57.00 89236WAC2 TOYOTAAUTO 1.120% D15119 99.98! 126,127,4900 126,108.42 126,101.00 0.03 (Z42) 89238BA68 TOYOTAAUTO 2.100%10/15120 99.59 5,17Op000000 5,169,471.63 5,148,906A0 1.02 (20,565.23) 90331HNL3 US BANK NA MTN 2.850% 123123 98.73 5,000,000,0000 4,981,600.00 4,936,350,00 0.98 (45,250.00) 912828633 US TREASU BY NT 1.500% 1131119 99.49 11,000,W0,0000 11,042,439.19 10,944,120,00 2.17 (98,319.19) 912828F39 US TREASU BY NT 1.750% 9/30119 99.29 5,800,000,0000 5,873,186.87 5,758,530,00 1.14 (114,656.87) 91282BG61 US TREASURY NT 1.500%11130/19 98.77 7,500,000.0000 7,449,634.50 7,407,750,00 1.47 (41,884.50) 912828J76 US TREASURY NT 1.750% 3/31122 97.17 5,000,00D.0000 4,976,383.94 4,858,600,00 0.96 (117,783.94) 3 d 4 U.S. Bank Asset Detail - Consolidated As of 3/3 112 01 8 CUSIP Asset Short Name = Price Shares/Units Cost Basis Market Value Percent of Total Unrealized Gain/Lon 912828124 US TREASURY NT 1.875% 8/31122 97.26 6,000,0000000 5,987,832.60 5,835,720,00 1.16 (152,112.60) 9128281-57 US TREASURY NT 1.750% 9/30122 96.66 13,000,000,0000 12,763,554.69 12,565,800,00 2.49 (19],]54.69) 912828199 US TREASURY NT 1.375%10131/20 97.52 10,000,000,0000 9,850,311.40 9,752,30000 1.94 (98,011.40) 912828MBO US TREASURY NT 2.000%11130122 97.61 8,000,000,0000 7,907,500.00 7,809,W0.00 1.55 (98460.00) 9128281,130 US TREASURY NT 2.125%12131/22 98.07 5,000,000,0000 4,926,562.50 4,903,700,00 0.97 (22,862.50) 912828N89 US TREASURY NT 1.375% 1/31121 97.22 6,000,000,0000 5,895,840.41 51833,380,00 1.16 (62,480.41) 912828045 US TREASURY NT 0.875% 3/31118 100.00 13,000,000,0000 12,%1,523.44 13,000,000.00 2.58 18,4]6.56 912828868 US TREASURY N 5]T 0.750% 7/31118 99.65 15,000,000,0000 14,932,226. 14,946,750,00 2.97 14,523,43 912828SN1 US TREASURY NT 1.500% 3/31119 99.38 5,000,0000000 5,016A23.00 4,968,950,00 0.99 (47,473,00) 912828T34 US TREASURY NT 1.125% 9/30121 95.53 7,000,000,0000 6,757,914.08 6,686,890,00 1.33 (71,024.08) 91282BT67 US TREASURY NT 1.250%10131/21 95.84 6,000,0000000 5,813,691.96 5,750,400,00 1.14 (63,291,98) 912828U65 US TREASURY NT 1.750%11130121 97.45 7,000,000,0000 6,900,492.20 6,821,710,00 1.35 (78,]8220) 912828UU2 US TREASURY NT 0.750% 3/31118 100.00 5,000,0000000 4,991,015.63 5,000,000,00 0.99 8,984.37 912828V]2 US TREASURY NT 1.875% 1/31122 9].]3 3,000,000,0000 3,004,814.74 2,932,020,00 0.58 (72,794.74) 912828VE7 US TREASU RV NT 1.000% 5/31118 99.88 8 00 0,0000000 ],983,]50.00 1,990p20.00 1.59 6,970.00 912828WS5 US TREASU RV NT 1.625% 6/30119 99.32 2,000,000,0000 1,996,861.44 1,986,320,00 0.39 (10,541.44) 912828W U0 U S TREASU RV I IFS 0.125% 7115124 W.]0 10,854,584.0000 10,709,864.09 10,604,820.02 2.11 (105,044.07) 912828WW6 US TREASU RV NT 1.625% 7/31119 99.25 5,000,000,0000 5,012,388.70 4,962,500,00 0.99 (49,888.70) 912828XE5 US TREASU RV NT 1.500% 5/31120 98.26 5,000,000,0000 4,966A23.00 4,912,900.00 0.98 (53,523,00) 912828=5 U S TREASU RV NT 1.750% 6/30122 96.92 5,000,000,0000 4,973AS4.25 4,845,900,00 0.96 (127,554.25) 913366EJ5 UNIV OF CALIFORNIA 5.035% 5/15121 107.01 400,000,0000 400,000.00 428,040.00 0.08 28,040.00 94974BGM6 WELLS FARGO CO MTN 2.600% 7/22120 99.05 5,000,000,0000 5,001,650.00 4,952,250,00 0.98 (49,400.00) 95000U2B8 WELLS FARGO MTN 2.625% 7/22122 96.73 3,000,000,0000 2,954,520.00 2,901,870,00 0.58 (52,650,00) Flied Income Total 430,111,163.8900 427,989,343.98 421,00,763.90 83.67 (6,498,580.0800) Grand Total 512,556,053.0000 510,1",296.41 503,728,487.21 100.00 (6,415,809.20) 4 of U.S. Bank Transaction History 03/01/2018 Thru 03/31/2018 Post Date CUSIP Id Explanation Units Prios Net Cash Amt Cost Gain/Loss ACQUISITIONS 03/01/2018 31846V567 PURCHASED UNITS OF FIRST AM GOVT OB FD CL Z 33,330.0000 1.000000 -33,330,00 33,330.00 0,00 03/01/2018 31846V567 PURCHASED UNITS OF FIRST AM GOUT OB FD CL Z 9,391.5400 1.000000 -9,391.54 9,391.54 0.00 03/02/2018 31846V567 PURCHASED UNITS OF FIRST AM GOVT OB FD CL Z 28,746.2800 1.000000 -28,746.28 28,746.28 0.00 03/05/2018 31846V567 PURCHASED UNITS OF FIRST AM GOVT OB FD CL Z 29,375.0000 1.000000 -29,375.00 29,375.00 0.00 03/07/2018 31846VS67 PURCHASED UNITS OF FIRST AM GOVT OB FD CL Z 5,021.875.0000 1.000000 5,021.875.00 5,021.875.00 0.00 03/08/2018 31846V567 PURCHASED UNITS OF FIRST AM GONT OB FD CL Z 56,250.0000 1.000000 -56.250.00 56.250.00 0.00 03/09/2018 31846V567 PURCHASED UNITS OF FIRST AM GOVT OB FD CL Z 7,551,562.5000 1.000000 -7,551,562.50 7,551,562.50 0.00 03/12/2018 31846V567 PURCHASED UNITS OF FIRST AM GOVT OB FD CL Z 24,380.0000 1.000000 -24,380.00 24,380.00 0.00 03/13/2018 06538CFD8 PURCHASED PAR VALUE OF BANK OF TOKYO MITSUBIS C P 6/131181MUFG UNION 8,240.000.0000 0.994633 -8,195.778.67 8,195.778.67 0.00 BK NA/MMI/PIMS/IPA/8,240,000 PAR VALUE AT 99.46333337% 03/13/2018 31846V567 PURCHASED UNITS OF FIRST AM GOVT OB FD CL Z 2,031,357.4000 1.000000 -2,031,357.40 2,031,357.40 0.00 03/13/2018 44932HAH6 PURCHASED PAR VALUE OF IBM CREDIT CORP 3.000% 2/06123/BARCLAYS 1,680,000.0000 0.990310 -1,663,720.80 1,663,720.80 0.00 CAPITAL INC.FIXED IN/1,680,000 PAR VALUE AT 99.031 % 03/13/2018 44932HAH6 PURCHASED PAR VALUE OF IBM CREDIT CORP 3.000% 2/06123/PERSHING 2.985,000.0000 0.990130 -2,955.538.05 2.955.538.05 0.00 LLC/2,985,000 PAR VALUE AT 99,013% 03/14/2018 31846V567 PURCHASED UNITS OF FIRST AM GOVT OB FD CL Z 56,875.0000 1.000000 -56,875.00 56,875.00 0.00 03/15/2018 31846V567 PURCHASED UNITS OF FIRST AM GOVT OB FD CL Z 157.572.1800 1.000000 -157.572.18 157.572.18 0.00 03/15/2018 31846V567 PURCHASED UNITS OF FIRST AM GONT OB FD CL Z 907,675.5500 1.000000 -907.675.55 907.675.55 0.00 03/16/2018 31846V567 PURCHASED UNITS OF FIRST AM GOVT OB FD CL Z 58,529.5700 1.000000 -58,529.57 58,529.57 0.00 03/19/2018 31846V567 PURCHASED UNITS OF FIRST AM GOVT OB FD CL Z 3,001,500.0000 1.000000 3,001,500.00 3,001,500.00 0.00 03/19/2018 31846V567 PURCHASED UNITS OF FIRST AM GOVT OB FD CL Z 4.161.5000 1.000000 3,161.50 4.161.50 0.00 03/20/2018 4042BOBFS PURCHASED PAR VALUE OF HSBC HOLDINGS PLC 2.650% 1/05/22/PERSHING 1.500,000.0000 0.971560 -1,457.340.00 1,457.340.00 0.00 LLC/1,500,000 PAR VALUE AT 97.156% 03/20/201847788CAB8 PURCHASED PAR VALUE OF JOHN DEERE OWNER 2.420%10/15120/MITSUBISHI 1,800,000.0000 0.997969 -1,796,343.75 1,796,343.75 0.00 UFJ SECURITIES USA/1,800,000 PAR VALUE AT 99.796875% 03/21/2018 313385VE3 PURCHASED PAR VALUE OF F H L B DISC NTS 4/06118/JEFFERIES 4,350,000.0000 0.999244 .4,346.713.33 4.346.713.33 0.00 LLC/4,350,000 PAR VALUE AT 99,92444437% 03/21/2018 31846V567 PURCHASED UNITS OF FIRST AM GOVT OB FD CL Z 5,000,000.0000 1.000000 5,000,000.00 5,000,000.00 0.00 03/22/2018 89233HE75 PURCHASED PAR VALUE OF TOYOTA MOTOR CREDIT CO C P 5/07/18/DBTC 8,000.000.0000 0.997585 -7,980.680.00 7,980.680.00 0.00 AMERICAS/COMMERCIAL PAPER18,000,000 PAR VALUE AT 99.7585% 03/26/2018 31846V567 PURCHASED UNITS OF FIRST AM GOVT OB FD CL Z 3,188.2500 1,000000 -3,188.25 3,188.25 0.00 03/26/2018 31846V567 PURCHASED UNITS OF FIRST AM GOVT OB FD CL Z 28,467.4000 1.000000 -28,467.40 28,467.40 0.00 03/28/2018 313385VZ6 PURCHASED PAR VALUE OF F H L B DISC NTS 4/25/18/GOLDMAN SACHS 8 10,000.000.0000 0.998689 -9,986.894.44 9,986,894.44 0.00 CO.LLC/10,000,000 PAR VALUE AT 99.8689444% 1 of 7 U.S. Bank Transaction History 03/01/2018 Thru 03/31/2018 Post Date CUSIPId Explanation Units Price Net Cash Anat Cost Gain/Loss 03/28/2018 31846V567 PURCHASED UNITS OF FIRST AM GOVT OB FD CL Z 522,070.4200 1.000000 -522,070 42 522,07042 0.00 03/28/2018 69353RFB9 PURCHASED PAR VALUE OF PNC BANK NA MTN 2.625% 2/17/22/GOLDMAN 1,000.000.0000 0.974940 -974,940.00 974.940.00 0.00 SACHS&CO.LLC/1,000,000 PAR VALUE AT 97.494% 03/29/2018 3135GOT94 PURCHASED PAR VALUE OF F N M A DEB 2.375% 1/19/23/J.P.MORGAN 3,000,000.0000 0.985470 -2,956,410.00 2,956,410.00 0.00 SECURITIES LLC/3,000,000 PAR VALUE AT 98.547% 03/29/2018 4581XOCS5 PURCHASED PAR VALUE OF INTER AMERICAN DEVEL 1.875% 3115/21 /BMO 1,500,000.0000 0.979470 -1,469,205,00 1,469,205.00 0,00 CAPITAL MARKETS CORP/BONDS/1,500,000 PAR VALUE AT 97.947% TOTAL ACQUISITIONS 68,581,307.5900 -68,309,871.63 68,309,871.63 0.00 DISPOSITIONS 03/07/2018 3137EADP1 MATURED PAR VALUE OF F H L M C 0,875% 3/07/18 5,000,000 PAR VALUE AT -5,000,000.0000 1.000000 5,000,000.00 -4,974,100.00 25,900.00 100% 03/09/2018 31337BA43 MATURED PAR VALUE OF F H L B DEB 1.375% 3/09118 7,500,000 PAR VALUE AT -7,500,000.0000 1.000000 7,500.000.00 -7,544.850.00 .44,850.00 100% 03/13/2018 06538CCD1 MATURED PAR VALUE OF BANK OF TOKYO MITSUBIS C P 3/13/18 6,665,000 PAR -6,665,000.0000 1.000000 6,631,443.58 -6,631,443.58 0.00 VALUE AT 100% 03/19/2018 025816AY5 MATURED PAR VALUE OF AMERICAN EXPRESS 7.000% 3119/182,900.000 PAR -2,900,000.0000 1.000000 2,900.000.00 -3,377.385.79 477,385.79 VALUE AT 100% 03/21/2018 3133851,144 MATURED PAR VALUE OF F H L B DISC NTS 3/21/18 5,000,000 PAR VALUE AT 5,000,000.0000 1.000000 4,995,722.22 -4,995,722.22 0.00 100% 03/28/2018 313385UV6 MATURED PAR VALUE OF F H L B DISC NTS 3/28118 1,500,000 PAR VALUE AT -1.500.000.0000 1.000000 1,498.223.75 -1,498.223.75 0.00 100% 03/01/2018 83162CLJO PAID DOWN PAR VALUE OF S B A GTD DEV PART 6.340% 3/01/21 -7,901.1200 6.581345 7,901.12 -7,901.12 0.00 03/15/2018 31348SWZ3 PAID DOWN PAR VALUE OF F H L M C#786064 3.426% 1101/28 FEBRUARY FHLMC -15.9200 0.000000 15.92 -15.53 0.39 DUE 3/15118 03/15/2018 3133TCE95 PAID DOWN PAR VALUE OF F H L M C MLTCL MTG 3.391% 8/15/32 -998.4000 0.000000 998.40 -999.44 -1.04 03/15/2018 43814QAC2 PAID DOWN PAR VALUE OF HONDA AUTO 1.390% 4115120 -120,198.7300 5.962096 120,198.73 -120.196.40 2.33 03/15/2018 47788NAB4 PAID DOWN PAR VALUE OF JOHN DEERE OWNER 1.090% 2/15119 CMO FINAL -140,599.4700 0.000000 140,599.47 -140.590.89 8.58 PAYDOWN 03/15/2018 47788MAC4 PAID DOWN PAR VALUE OF JOHN DEERE OWNER 1.360% 4/15120 -153,535.6900 4.667556 153,535.69 -153,511.52 24.17 03/15/201847787XAB3 PAID DOWN PAR VALUE OF JOHN DEERE OWNER 1.500%10/15/19 -114.499.8800 6.258839 114,499.88 -114.499.42 0.46 03/15/2018 47788BABO PAID DOWN PAR VALUE OF JOHN DEERE OWNER 1.590% 4115120 -81.819.1800 8.758782 81,819.18 -81.812.07 7.11 03/15/2018 65478WAB1 PAID DOWN PAR VALUE OF NISSAN AUTO 1.070% 5/15119 -130,358.1600 5.497442 130,358.16 -130,353.02 5.14 03/15/2018 654747ABO PAID DOWN PAR VALUE OF NISSAN AUTO 1.470% 1/15/20 -96,424.3500 7.432110 96,424.35 -96,423.86 0.49 03/15/201889236WAC2 PAID DOWN PAR VALUE OF TOYOTA AUTO 1.120% 2/15/19 -127.480.7100 5.621528 127.480.71 -127.461.43 19.28 03/16/2018 3837144NX9 PAID DOWN PAR VALUE OF G N M A GTD REMIC 2.088% 2/16/30 -997.9800 0.000000 997.98 -997.98 0.00 2 of U.S. Bank Transaction History 03/01/2018 Thru 03/31/2018 Post Date CUSIPId Explanation Units Price Net Cash Anat Cost Gain/Loss 03/20/2018 36225CAZ9 PAID DOWN PAR VALUE OF G N M A I I#OB0023 3.125%12/20/26 FEBRUARY GNMA -195.9000 0.000000 195.90 -199.14 -3 24 DUE 3120118 03/20/2018 36225CC20 PAID DOWN PAR VALUE OF G N M A 119080088 2.625% 6120127 FEBRUARY GNMA -1.035.7600 0.000000 1.035.76 -1.058.42 -22.66 DUE 3120118 03/20/2018 36225CNM4 PAID DOWN PAR VALUE OF G N M A 11#080395 2.625% 4/20130 FEBRUARY GNMA 53.2300 0.000000 53.23 52.75 0.48 DUE 3120118 03/20/2018 36225CN28 PAID DOWN PAR VALUE OF G N M A 119080408 2.625% 5120130 FEBRUARY GNMA -398.4400 0.000000 398.44 -394.39 4.05 DUE 3120118 03/20/2018 36225DCB8 PAID DOWN PAR VALUE OF G N M A 11#080965 2.750% 7/20134 FEBRUARY GNMA -1,256.2000 0.000000 1,256.20 -1,255.41 0.79 DUE 3120118 03/21/2018 43814TAB8 PAID DOWN PAR VALUE OF HONDA AUTO 1.420% 7122119 -143.873.4200 0.000000 143,873.42 -143.869.98 3.44 03/2612018 31394JY35 PAID DOWN PAR VALUE OF F H L M C MLTCL MTG 6.500% 9/25/43 -2,756.8100 0.000000 2,756.81 -3,12.2.09 -365.28 03/26/2018 31371NUC7 PAID DOWN PAR VALUE OF F N M A#257179 4.500% 4/01128 FEBRUARY FNMA -160.2000 0.000000 160.20 -169.43 -9.23 DUE 3125118 03/26/2018 31376KT22 PAID DOWN PAR VALUE OF F N M A#357969 5.000% 9101135 FEBRUARY FNMA -1,812.7400 0.000000 1.812.74 -1.948.70 -135.96 DUE 3125118 03/26/2018 31381 PDA3 PAID DOWN PAR VALUE OF F N M A#466397 3.1733%11/01/20 FEBRUARY FNMA -788.7000 0.000000 788.70 -771.63 17.07 DUE 3125/18 03/26/2018 31403DJZ3 PAID DOWN PAR VALUE OFF N M A#745580 5.000% 6101136 FEBRUARY FNMA -1,994.3100 0.000000 1.994.31 -2.143.88 -149.57 DUE 3125118 03/26/2018 31403GXF4 PAID DOWN PAR VALUE OF F N M A#748678 5.000%10/01/33 FEBRUARY FNMA -15.0700 0.000000 15.07 -16.20 -1.13 DUE 3125/18 03/26/2018 31406PQYB PAID DOWN PAR VALUE OF F N M A#815971 5.000% 3101135 FEBRUARY FNMA -934.7900 0.000000 934.79 -1.004.90 -70.11 DUE 3125118 03/26/2018 31406XWT5 PAID DOWN PAR VALUE OF F N M A#823358 3.484% 2/01135 FEBRUARY FNMA -480.5200 0.000000 480.52 476.77 3.75 DUE 3125118 03/26/2018 31407BXH7 PAID DOWN PAR VALUE OF F N M A#826080 5.000% 7101135 FEBRUARY FNMA .86.9900 0.000000 86.99 -93.51 .6.52 DUE 3125118 03/26/2018 31410F4V4 PAID DOWN PAR VALUE OF F N M A#888336 5.000% 7/01136 FEBRUARY FNMA -4,357.7600 0.000000 4,357.76 -4,684.59 -326.83 DUE 3125118 03/26/2018 3138EG6F6 PAID DOWN PAR VALUE OF F N M A#AL0869 4.500% 6101129 FEBRUARY FNMA -185.9700 0.000000 185.97 -196.68 -10.71 DUE 3125118 03/26/2018 31417YAY3 PAID DOWN PAR VALUE OF F N M A#MA0022 4.500% 4/01/29 FEBRUARY FNMA -257.4300 0.000000 257.43 -272.26 -14.83 DUE 3125118 03/26/2018 31397QREO PAID DOWN PAR VALUE OF F N M A GTD REMIC 1.113% 2125/41 .4.565.1100 0.000000 4.565.11 .4.563.68 1.43 03/13/2018 31846V567 SOLD UNITS OF FIRST AM GOVT OB FD CL Z -8,195,778.6700 1,000000 8,195,778.67 -8,195,778.67 0.00 03/20/2018 31846V567 SOLD UNITS OF FIRST AM GOVT OB FD CL Z -3,261,019.4400 1.000000 3,261,019.44 -3,261,019.44 0.00 03/21/2018 31846V567 SOLD UNITS OF FIRST AM GOVT OB FD CL Z -4,201.698.4300 1.000000 4,201.698.43 -4,201.698.43 0.00 3 of U.S. Bank Transaction History 03/01/2018 Thru 03/31/2018 PostDate CUSIPId Explanation Units Price Net Cash Amt Cost Gain/Loss 03/22/2018 31846V567 SOLD UNITS OF FIRST AM GOVT OB FD CL Z -7,980,680.0000 1,000000 7,980,680.00 -7,980,680,00 0.00 03/28/2018 31846V567 SOLD UNITS OF FIRST AM GOUT OB FD CL Z -9,986,894.4400 1.000000 9,986,894.44 -9,986,894.44 0.00 03/29/2018 31846V567 SOLD UNITS OF FIRSTAM GOVTOB FD CLZ -4,439,771.2500 1.000000 4,439,771.25 -4,439,771.25 0.00 TOTAL DISPOSITIONS -67,770,881.1700 67,731,270.72 -68,228,624.66 497,353.94 OTHER TRANSACTIONS 03/13/2018 912828WUO BOOK VALUE OF U S TREASURY I P S 0.125% 7/15/24 ADJUSTED BY 26416.00 0.0000 0.000000 0.00 0.00 0.00 UNITS INCREASE TO ADJUST FOR CHANGE IN CPI 03/28/2018 912828WUO BOOK VALUE OF U S TREASURY I P S 0.125% 7/15124 ADJUSTED BY 30368.00 0.0000 0.000000 0.00 0.00 0.00 UNITS INCREASE TO ADJUST FOR CHANGE IN CPI 03/13/2018 912828WUO FED BASIS OF U S TREASURY 1 PS 0.125% 7/15/24 ADJUSTED BY 26416.00 UNITS 0.0000 0.000000 0.00 26,416.00 0.00 INCREASE TO ADJUST FOR CHANGE IN CPI 03/28/2018 912828WUO FED BASIS OF U S TREASURY I PS 0.125% 7115124 ADJUSTED BY 30368.00 UNITS 0.0000 0.000000 0.00 30.368.00 0.00 INCREASE TO ADJUST FOR CHANGE IN CPI 03/19/2018 025B16AY5 INTEREST EARNED ON AMERICAN EXPRESS 7.000% 3119/18$1 PV ON 0.0000 0.000000 101,500.00 0.00 0.00 2900000.0000 SHARES DUE 3/19/2018 03/26/2018 03215PFN4 INTEREST EARNED ON AMRESCO 2.38996% 6126/29$1 PV ON 266.3700 0.0000 0.000000 266.37 0.00 0.00 SHARES DUE 3/25/2018$0.00199/PV ON 133,743.29 PV DUE 3/25/18 03/12/2018 06406HCW7 INTEREST EARNED ON BANK NY MELLON MTN 2.300% 9/11/19$1 PV ON 0.0000 0.000000 24,380.00 0.00 0.00 2120000.0000 SHARES DUE 3/11/2018 03/13/2018 06538CCD1 INTEREST EARNED ON BANK OF TOKYO MITSUBIS C P 3113118$1 PV ON 0.0000 0.000000 33.556.42 0.00 0.00 6665000.0000 SHARES DUE 3/13/2018 6,665,000 PAR VALUE AT 100% 03/15/2018 532457BF4 INTEREST EARNED ON ELI LILLY CO 1.950% 3/15119$1 PV ON 4000000.0000 0.0000 0.000000 39,000.00 0.00 0.00 SHARES DUE 3/1 512 01 8 03/01/2018 30231GAV4 INTEREST EARNED ON EXXON MOBIL 2.222% 3/01121 $1 PV ON 3000000.0000 0.0000 0.000000 33.330.00 0.00 0.00 SHARES DUE 3/1/2018 03/09/2018 313378A43 INTEREST EARNED ON F H L B DEB 1.375% 3/09/18$1 PV ON 7500000.0000 0.0000 0.000000 51,562.50 0.00 0.00 SHARES DUE 3/9/2018 03/08/2018 3133782M2 INTEREST EARNED ON F H L B DEB 1.500% 3/08/19$1 PV ON 7500000.0000 0.0000 0.000000 56.250.00 0.00 0.00 SHARES DUE 3/8/2018 03/21/2018 313385UN4 INTEREST EARNED ON F H L B DISC NITS 3/21/18$1 PV ON 5000000.0000 0.0000 0.000000 4,277.78 0.00 0.00 SHARES DUE 3/21/2018 5,000,000 PAR VALUE AT 100% 03/28/2018 313385UV6 INTEREST EARNED ON F H L B DISC NITS 3128/18$1 PV ON 1500000.0000 0.0000 0.000000 1.776.25 0.00 0.00 SHARES DUE 3/28/2018 1,500,000 PAR VALUE AT 100% 03/07/2018 3137EADP1 INTEREST EARNED ON F H L M C 0.875% 3107/18$1 PV ON 5000000.0000 0.0000 0.000000 21,875.00 0.00 0.00 SHARES DUE 377/2018 03/15/2018 31348SWZ3 INTEREST EARNED ON F H L M C#786064 3.426% 1/01128$1 PV ON 6.2100 SHARES 0.0000 0.000000 6.21 0.00 0.00 DUE 3/15/2018 JANUARY FHLMC DUE 3/15/18 4 of U.S. Bank Transaction History 03/01/2018 Thru 03/31/2018 Post Date CUSIPId Explanation Units Price Net Cash Anat Cost Gain/Loss 03/15/2018 3133TCE95 INTEREST EARNED ON F H L M C MLTCL MTG 3.391% 8115/32$1 PV ON 63.4700 0.0000 0.000000 63.47 0.00 0.00 SHARES DUE 3/15/2018$0D0283/PV ON 22,461.00 PV DUE 3115/18 03/26/2018 31398VJ98 INTEREST EARNED ON F H L M C MLTCL MTG 4.251% 1125120$1 PV ON 900000.0000 0.0000 0.000000 3.188.25 0.00 0.00 SHARES DUE 3/2 512 01 8 03/26/2018 31394JY35 INTEREST EARNED ON F H L M C MLTCL MTG 6.500% 9125/43$1 PV ON 4676.0200 0.0000 0.000000 4,676.02 0.00 0.00 SHARES DUE 3/25/2018$0.00542/PV ON 863,264.52 PV DUE 3125/18 03/26/2018 31371NUC7 INTEREST EARNED ON F N M A#257179 4.500% 4/01128$1 PV ON 77.1600 0.0000 0.000000 77.16 0.00 0.00 SHARES DUE 3125/2018 FEBRUARY FNMA DUE 3/25118 03/26/2018 31376KT22 INTEREST EARNED ON F N M A#357969 5.000% 9/01/35$1 PV ON 545.0700 0.0000 0.000000 545.07 0.00 0.00 SHARES DUE 3/2 512 01 8 FEBRUARY FNMA DUE 3125/18 03/26/2018 31381 PDA3 INTEREST EARNED ON F N M A#466397 3.1733%11/01/20$1 PV ON 927.4500 0.0000 0.000000 927.45 0.00 0.00 SHARES DUE 3125/2018 FEBRUARY FNMA DUE 3/25118 03/26/2018 31403DJZ3 INTEREST EARNED ON F N M A#745580 5.000% 6/01/36$1 PV ON 527.9100 0.0000 0.000000 527.91 0.00 0.00 SHARES DUE 312 512 01 8 FEBRUARY FNMA DUE 3125/18 03/26/2018 31403GXF4 INTEREST EARNED ON F N M A#748678 5.000%10/01/33$1 PV ON 11.9400 0.0000 0.000000 11.84 0.00 0.00 SHARES DUE 3125/2018 FEBRUARY FNMA DUE 3/25118 03/26/2018 31406POY8 INTEREST EARNED ON F N M A#815971 5.000% 3/01/35$1 PV ON 910.5800 0.0000 0.000000 910.58 0.00 0.00 SHARES DUE 312 512 01 8 FEBRUARY FNMA DUE 3125/18 03/26/2018 31406XWT5 INTEREST EARNED ON F N M A#823358 3.484% 2/01/35$1 PV ON 379.7000 0.0000 0.000000 379.70 0.00 0.00 SHARES DUE 3125/2018 FEBRUARY FNMA DUE 3125118 03/26/2018 31407BXH7 INTEREST EARNED ON F N M A#826080 5.000% 7/01/35$1 PV ON 100.3200 0.0000 0.000000 100.32 0.00 0.00 SHARES DUE 3/2 512 01 8 FEBRUARY FNMA DUE 3125/18 03/26/2018 31410F4V4 INTEREST EARNED ON F N M A#888336 5.000% 7/01/36$1 PV ON 1025.4100 0.0000 0.000000 1.025.41 0.00 0.00 SHARES DUE 3125/2018 FEBRUARY FNMA DUE 3/25118 03/26/2018 3138EG6F6 INTEREST EARNED ON F N M A#AL0869 4.500% 6/01/29$1 PV ON 52.5500 0.0000 0.000000 52.55 0.00 0.00 SHARES DUE 312 512 01 8 FEBRUARY FNMA DUE 3125/18 03/26/2018 31417YAY3 INTEREST EARNED ON F N M A#MA0022 4.500% 4101129$1 PV ON 86.6900 0.0000 0.000000 86.69 0.00 0.00 SHARES DUE 3125/2018 FEBRUARY FNMA DUE 3/25118 03/26/2018 31397OREO INTEREST EARNED ON F N M A GTD REMIC 1.113% 2/25/41 $1 PV ON 483.9300 0.0000 0.000000 483.93 0.00 0.00 SHARES DUE 3/25/2018$0.00192/PV ON 252,410.26 PV DUE 3125/18 03/01/2018 31846V567 INTEREST EARNED ON FIRST AM GOVT OB FD CL Z UNIT ON 0.0000 SHARES DUE 0.0000 0.000000 28.746.28 0.00 0.00 2/2812018 INTEREST FROM 211/18 TO 2/28118 03/20/2018 36225CAZ9 INTEREST EARNED ON G N M A 11#080023 3.125%12/20126$1 PV ON 54.6900 0.0000 0.000000 54.69 0.00 0.00 SHARES DUE 3/20/2018 FEBRUARY GNMA DUE 3/20/18 03/20/2018 36225CC20 INTEREST EARNED ON G N M A 11#080088 2.625% 6/20/27$1 PV ON 50.9700 0.0000 0.000000 50.97 0.00 0.00 SHARES DUE 3120/2018 FEBRUARY GNMA DUE 3120/18 03/20/2018 36225CNM4 INTEREST EARNED ON G N M A 11#080395 2.625% 4/20/30$1 PV ON 18.8500 0.0000 0.000000 18.85 0.00 0.00 SHARES DUE 3/20/2018 FEBRUARY GNMA DUE 3/20/18 50f7 U.S. Bank Transaction History 03/01/2018 Thru 03/31/2018 Post Date CUSIPId Explanation Units Price Net Cash Anat Cost Gain/Loss 03/20/2018 36225CN28 INTEREST EARNED ON G N M A 11#0804082.625% 5/20/30$1 PV ON 147.9800 0.0000 0.000000 147.98 0.00 0.00 SHARES DUE 3/20/2018 FEBRUARV GNMA DUE 3/20/18 03/20/2018 36225DCBB INTEREST EARNED ON G N M A 11#0809652.750% 7/20134$1 PV ON 153.5400 0.0000 0.000000 153.64 0.00 0.00 SHARES DUE 3120/2018 FEBRUARV GNMA DUE 3120/18 03/16/2018 3837144NX9 INTEREST EARNED ON G N M A GTD REMIC 2.088% 2/16/30$1 PV ON 31.5900 0.0000 0.000000 31.59 0.00 0.00 SHARES DUE 3/16/2018$0.001741PV ON 18,155.33 PV DUE 3116/18 03/19/2018 43814RACO INTEREST EARNED ON HONDA AUTO 1.210%12/18/20$1 PV ON 2875000.0000 0.0000 0.000000 2,898.96 0.00 0.00 SHARES DUE 3/1 BJ2018 31181181NT PVMT 03/15/2018 43814OAC2 INTEREST EARNED ON HONDA AUTO 1.390% 4/15/20$1 PV ON 1739.8000 0.0000 0.000000 1,739.80 0.00 0.00 SHARES DUE 3/15/2018$0.00116/PV ON 1,501,981.94 PV DUE 3115118 03/21/2018 43814TAB8 INTEREST EARNED ON HONDA AUTO 1.420% 7/22119$1 PV ON 1141.4800 0.0000 0.000000 1,141.48 0.00 0.00 SHARES DUE 3121/2018$0.00118/PV ON 964.634.08 PV DUE 3/21/18 03/19/2018 43814PAB6 INTEREST EARNED ON HONDA AUTO 1.570% 1/21/20$1 PV ON 1262.5400 0.0000 0.000000 1,262.54 0.00 0.00 SHARES DUE 3/18/2018$0.00131/PV ON 965,000.00 PV DUE 3118118 03/05/2018 40428HPR7 INTEREST EARNED ON HSBC USA INC 2.350% 3105120$1 PV ON 2500000.0000 0.0000 0.000000 29.375.00 0.00 0.00 SHARES DUE 3/5/2018 03/14/2018 4581XOCZ9 INTEREST EARNED ON INTER AMER DEV BK 1.750% 9/14/22$1 PV ON 0.0000 0.000000 56,875.00 0.00 0.00 6500000.0000 SHARES DUE 3/14/2018 03/15/2018 4581XOCS5 INTEREST EARNED ON INTER AMERICAN DEVEL 1.875% 3/15/21 $1 PV ON 0.0000 0.000000 32,812.50 0.00 0.00 3500000.0000 SHARES DUE 3/1 512 01 8 03/16/2018 24422ESS9 INTEREST EARNED ON JOHN DEERE CAP MTN 2.300% 9/16/19$1 PV ON 0.0000 0.000000 57,500.00 0.00 0.00 5000000.0000 SHARES DUE 3/1612018 03/15/2018 47788NAB4 INTEREST EARNED ON JOHN DEERE OWNER 1.090% 2/15/19$1 PV ON 0.0000 0.000000 127.71 0.00 0.00 140599.4700 SHARES DUE 3/15/2018 03/15/2018 47788MAC4 INTEREST EARNED ON JOHN DEERE OWNER 1.360% 4/15/20$1 PV ON 2049.4800 0.0000 0.000000 2,049.48 0.00 0.00 SHARES DUE 3/15/2018$0.001131PV ON 1.808,360.38 PV DUE 3/15118 03/15/2018 47787XAB3 INTEREST EARNED ON JOHN DEERE OWNER 1.500%10/15/19$1 PV ON 1311.5000 0.0000 0.000000 1,311.50 0.00 0.00 SHARES DUE 3115/2018$0.00125/PV ON 1,049,196.07 PV DUE 3/15118 03/15/2018 47788BABO INTEREST EARNED ON JOHN DEERE OWNER 1.590% 4/15/20$1 PV ON 1272.0000 0.0000 0.000000 1,272.00 0.00 0.00 SHARES DUE 3/1 512 01 8$0.001331PV ON 960,000.00 PV DUE 3115/18 03/15/2018 47788BAD6 INTEREST EARNED ON JOHN DEERE OWNER 1.820%10/15/21 $1 PV ON 0.0000 0.000000 1,023.75 0.00 0.00 675000.0000 SHARES DUE 3/15/2018 03/15/2018 65478WAB1 INTEREST EARNED ON NISSAN AUTO 1.070% 5115/19$1 PV ON 382.4500 0.0000 0.000000 382.45 0.00 0.00 SHARES DUE 3/15/2018$0.00089/PV ON 428,914.27 PV DUE 3115/18 03/15/2018 65478VAD9 INTEREST EARNED ON NISSAN AUTO 1.320% 1/15121 $1 PV ON 2200.0000 0.0000 0.000000 2.200.00 0.00 0.00 SHARES DUE 3115/2018$0.00110/PV ON 2,000,000.00 PV DUE 3/15118 03/15/2018 654747ABO INTEREST EARNED ON NISSAN AUTO 1.470% 1/15/20$1 PV ON 1270.4200 0.0000 0.000000 1,270.42 0.00 0.00 SHARES DUE 3/15/2018$0.00123/PV ON 1,037,080.94 PV DUE 3115118 6 of U.S. Bank Transaction History 03/01/2018 Thru 03/31/2018 Post Date CUSIPId Explanation Units Price Net Cash Anat Cost Gain/Loss 03/15/2018 65477UAD2 INTEREST EARNED ON NISSAN AUTO 1.500% 9/15/21 $1 PV ON 2250.0000 0.0000 0.000000 2,250.00 0.00 0.00 SHARES DUE 3/15/2018$0.00125/PV ON 1,800,000.00 PV DUE 3/15118 03/01/2018 83162CLJO INTEREST EARNED ON S B A GTD DEV PART 6.340% 3/01/21 $1 PV ON 1490.4200 0.0000 0.000000 1.490.42 0.00 0.00 SHARES DUE 311/2018$0.03170/PV ON 47,016.48 PV DUE 3/1/18 03/15/2018 89236WAC2 INTEREST EARNED ON TOYOTA AUTO 1.120% 2/15/19$1 PV ON 236.7000 0.0000 0.000000 236.70 0.00 0.00 SHARES DUE 3/15/2018$0.00093/PV ON 253,608.20 PV DUE 3115118 03/15/2018 89238BAB8 INTEREST EARNED ON TOYOTA AUTO 2.100%10/15/20$1 PV ON 5170000.0000 0.0000 0.000000 13.571.25 0.00 0.00 SHARES DUE 3/15/2018 03/29/2018 3135GOT94 PAID ACCRUED INTEREST ON PURCHASE OF F N M A DEB 2.375% 1/19123 0.0000 0.000000 -13,062.50 0.00 0.00 03/20/2018 40428OBF5 PAID ACCRUED INTEREST ON PURCHASE OF HSBC HOLDINGS PLC 2.650% 0.0000 0.000000 -8.281.25 0.00 0.00 1105122 03/13/2018 44932HAH6 PAID ACCRUED INTEREST ON PURCHASE OF IBM CREDIT CORP 3.000% 2106/23 0.0000 0.000000 5,180.00 0.00 0.00 03/13/2018 44932HAH6 PAID ACCRUED INTEREST ON PURCHASE OF IBM CREDIT CORP 3.000% 2106/23 0.0000 0.000000 -9,203.75 0.00 0.00 03/29/2018 4581XOCS5 PAID ACCRUED INTEREST ON PURCHASE OF INTER AMERICAN REVEL 1.875% 0,0000 0,000000 -1,093.75 0.00 0.00 3/15/21 03/20/2018 47788CAB8 PAID ACCRUED INTEREST ON PURCHASE OF JOHN DEERE OWNER 2.420% 0.0000 0.000000 -2.420.00 0.00 0.00 10/15/20 03/28/2018 69353RFB9 PAID ACCRUED INTEREST ON PURCHASE OF PNC BANK NA MTN 2,625% 2/17122 0.0000 0.000000 -2,989.58 0.00 0.00 03/13/2018 912828W UO PAR VALUE OF U S TREASURY I P S 0.125% 7/15/24 ADJUSTED BY 26416.0000 26.416.0000 0.000000 0.00 0.00 0.00 UNITS INCREASE TO ADJUST FOR CHANGE IN CPI 03/28/2018 912828WUO PAR VALUE OF U S TREASURY I P S 0.125% 7/15124 ADJUSTED BY 30368,0000 30,368,0000 0,000000 0.00 0.00 0.00 UNITS INCREASE TO ADJUST FOR CHANGE IN CPI 03/13/2018 912828W UO STATE COST OF U S TREASURY I P S 0.125% 7115124 ADJUSTED BY 26416.00 0.0000 0.000000 0.00 0.00 0.00 UNITS INCREASE TO ADJUST FOR CHANGE IN CPI 03/28/2018 912828WUO STATE COST OF U S TREASURY I P S 0,125% 7115/24 ADJUSTED BY 30368.00 0.0000 0.000000 0.00 0.00 0,00 UNITS INCREASE TO ADJUST FOR CHANGE IN CPI TOTAL OTHER TRANSACTIONS 56,784.0000 5 1 56,784.00 0.00 7 of Callan March 31, 2818 Orange County Sanitation District Investment Measurement Service Quarterly Review Inbrmatien demanded herein includes confidential,trade secret and pmprietlry Information.Neither this Report nor any specific information contained herein Is to be used other than by the intended recipient for its intended purpose or disseminated to any other personwithout Callan s permission Certain information herei has been compiled by Callan and Is based on information provided by a variety of sources believed to be reliable for which Callan has not necessarily verified the accuracy or completeness of or updated This content may consist of statements of opinion,which are made as of the date they are expressed and are not statements of fad.This content Is for international purposes only and should not be construed as legal or tax advice on any matter.Any decision you make on the basis of this content is your sole responsibility.You should consult with legal and tax advisers before applying any of this Information to your particular situation.Past performance is no guarantee of future results.For further information,please see Appendix for Important Information and Disclosures. Table of Contents March 31, 2018 Capital Markel Review 1 Active Management Overview Market Overview 7 Domestic Fixed Income 8 Asset Allocation Investment Manager Asset Allocation 10 Investment Manager Retums 11 Asset Class Risk and Return 15 Manager Analysis Chandler-Long Term Operating Fund 17 Chandler-Liquid Operating Money 21 Callan Research/Education 23 Definitions 26 Disclosures 31 Callan Orange County Sanitation District Executive Summary for Period Ending March 31, 2018 Asset Allocation March 31, 2018 December 31, 2017 Market Value Welaht Net New In, Inv. Return Markel Value Welaht Danesde Fixed Incm,e Long Teem CpeMing Fund' 412,837,715 81,64% 17,500,000 (1.254,966) 396.592,680 7316% Total Fund EWepO5p08 100.0% $(36,500,000) $198fi,fi08) $542,092,317 100.0% Performance Last Last Last Last Last 3 5 7 Quarter Year Years Years Years Domestic Fixed Income Long Term Operating FundA (0.31%) 0,35% 0,85% 0,66% 1,51% Chandler (0.31%) 0.35% 0.85% - - Blmbg Gmt/Cred 1-5 Year ldx (0.50%) 0.19% 0.77% 0.95% 1.44% ML 1-5 Govt/Corp (0.49%) 0,22% 0,81% 0,99% 1,50% Liquid Operating Monie$A 0.34% 1.10% 0.63% 0.42% 0.35% Chandler 0.34% 1.10% 0,63% - - CltionuD3-Month Treasuiv Bill 0.35% 1.07% 0.49% 0.31% 0.24% Total Fund (0.14%) 0.45% 0.72% 0.58% 1.28% Target' (0.32%) 0.39% 0,75% 0,86% 1.25% Current QuanerTamet=80.0%ML 15 GoWCap and 20.0%Citi 3moTaills AAssets me trendemed in lend to Chandleron 12/1Q014.Previousperrormanoe reflects PIMCO. Recent Developments During the quarter, $17.5 million was added to the Long Term Operating Fund, and $53.0 million was removed from Liquid Operating Monies. Organizational Issues — WA Manager Performance — Optimism quickly vanished in 2018 as investors turned their focus to rising wage pressures, policy uncertainties surrounding the incoming Fed Chair Jerome Powell, and escalating trade tensions between the U.S. and China. At its March meeting, the Fed hiked the Fed Funds target by 25 basis points to 1.50% - 1.75%, the first 25 bps increase of the year.The 10-year U.S. Treasury yield steadily rose to nearly 3% from a low of 2.41% at the start of the year, before declining to close the quarter at 2.74%. The curve flattened slightly during the quarter with the 2-year U.S. Treasury climbing 38 bps to close at 2.27%, and One 30-year U.S. Treasury climbing 23 bps to close at 2.97%. Market wpectations reflect the possibility of four rate hikes in 2018, up from three projected at the end of 2017. CallanOrange County Sanita"on Gs"ti The Bloomberg Aggregate Index fell 1.5% in the first quarter. Longer bonds felt the most pressure from increasing rates as the Bloomberg Long Gov/Credit Index lost 3.6% in the quarter. TIPS (Bloomberg U.S. TIPS Index -0.8%) outperformed nominal treasuries (Bloomberg U.S. Government Index -1.2%) and the 10-year breakeven inflation rate rose to 2.05% from 1.96% at the end of 2017. Outside of investment grade, the ML Figh Yield CP Index fell 0.9%while the CS Leveraged Loan Index, which benefitted from rising rates, rose 1.6%. The Long Term Operating Fund returned-0.31% in the quarter, outperforming the ML U.S. 1- 5 Corp/Gov Index (449%) and ranking "h percentile versus peers. The portfolio maintained a short duration position relative to the benchmark (2.41 versus 2.73 years), which helped relative performance as rates rose in the first quarter.The portfolio generated a lower yield than the benchmark(2.4% vs. 2.6%), which weighed on results. The Long Term Operating Fund had less than 30% invested in credit(21%)and less than the permitted 20% invested in the combination of asset-backed securities (6%), commercial mortgage backed securities(0%),and CMOs(1%)as of March 31,2018(see page 20). The Liquid Operating Portfolio gained 0.30% (after fees) in the quarter, which slightly trailed the return of the 3-month Treasury(+0.35%).The Portfolio returned 0.95%(after fees) for the trailing 12-months and ranked 29"percentile versus peers. Cordially, Gordon M.Weightman, CFA Senior Vice President 2 Capital Market Review Capital Market Overview March 31, 2018 U.S.EQUITY U.S.Equity:Quarterly Returns Volatility returned in the iu quarter of 2018,with the Dow and S&P 500 both ending the quarter down—a first since the 3- Russell 3000 -0.6% . quarter of 2015.After starting strong on the back of solid earnings and tax reform,U.S.equities faltered in the second half over concerns about a more aggressive global trade policy Russel110M -0.7% . and uncertainly over the pace of interest rate hikes.The S&P 500(.0.8%)experienced a marked Increase In volatility,with Russell 1000 Graph - 1.4% six days of movements greater than 2%during the quarter (versus none in 2017).Volatility as measured by the VIX index Russell 1000 Value -2.8% —reached a quarterly high of 116%on Feb.5 when the market sank 4%. S&P 50o 4.8% ■ Small Cap Outperforms Large Cap (Russell 1000:-0.7%;Russell 2000:.0.1%) Russell Midcap -0.5% , - The prospect of a trade war with China weighed on large caps since many of these companies are exposed to Russell 25M -0.2% ' international markets(S&P 500 aggregate is-40%)while small caps were less impacted as they tend to have a higher Russell 20M -0.1% proportion of their revenue exposure from domestic markets (-80-90%)and benefit from a more protectionist policy. - In mid-March,mega-cap Tech firms saw their stock prices drop in the wake of Facebook's Cambridge Analytica U.S.Equity:One-Year Returns scandal,leading to declining trust for the Industry and negative investor sentiment.The market began pricing in the potential for more regulatory oversight for these internet Russell 30M 13.8% companies.Performance for the"FANGS'split during the quarter,with Facebook and Google down while Neff ix and RusseII 1000 — 14.0% Amazon advanced. Value Continued to Trail Growth Russell 1000 Growth 21.3% (Russell 1000 Growth:+1.4%; Russell 1000 Value:-2.8%) Russell 1000 Value 6.9% - Value trailed as the prospect of increased inflation and accelerating interest rates weighed on interest rate-sensitive S&P 500 — 14.0% sectors(Financials:-1.0%,Real Estate:-5.0%,Utilities: Russell Midcap 12.2% - Energy(-5.9%)also took a hit despite a more promising outlook for the sector as the Saudis agreed to continued oil production cuts into 2019;performance for 1Q18 was Russell 25M 12.3% impacted by Exxon Mobil and Chevron missing 4Q17 earnings expectations. Russell 20M 11.8% Russell Sector Returns,Quarter ended March 31,2018 .Russell 1000 eRussell 2000 1A Mo.1.9% r0 -0.9% -1.4% -1.5� Technology Consumer Financial Health Care Producer Utilities Materiels& Energy Consumer Discretionary Services Durables Processing Staples Sources:FTSE Russell,Standard&Poor's Callan Capital Market Overview(continued) March 31, 2018 Defensive Sectors Underperformed Cyclicals Global Equity:Quarterly Returns - Despite the increased volatility and price drop in the broader index,defensive sectors underperformed cyclicals due in MSCI ACWI -1.0% ' large part to the rising interest rate environment.Technology (+3.5%)and Consumer Discretionary(+3.1%)were the only MSCI World -1.3% , two sectors that posted positive returns. - Telecommunications(-7.5%)and Staples(-7.1%)were the MSCI ACWI ex USA -1.2% , two worst-performing sectors. MSCI World ex USA -2.0% NON-U.S./GLOBAL EQUITY MSCI ACWI ex USA Small Cap -0.4% I Non-U.S.developed equity underperformed U.S.as non-U.S. equity markets were spooked by geopolitical tension and MSCI World ex USA Small Cap -0.5% ' market volatility along with fears of rising U.S.interest rates and inflation despite positive economic data.Emerging markets MSCI Europe ex UK -1.2% , continued to outpace developed,fueled by a soft dollar and synchronized global growth;however,fears of Inflation and Its MSCI United Kingdom -3.9% — implication on the trajectory of U.S.monetary policy—as well as a potential trade war with China—weighed on the market. MSCI Pacific ex Japan -3.7% Developed non-U.S.small cap outperformed large cap given the risk-on market environment spurted by synchronized global MSCI Japan ' 0.8% growth. MSCI Emerging Markets , 1.4% Global/Non-U.S.Developed (MSCI EAFE:-1.5%;MSCI Europe:-2.0%;MSCI Japan: MSCI China 1.6% +0.8%:MSCI World ex USA:-2.0%) MSCI Frontier Markets 5.1% - The dollar lost ground to the euro and yen,which buoyed returns for their respective regions. - Euro-zone recovery continued,with GDP growth of 2.7%in Global Equity:One-Year Returns the recent quarter year-over-year driving the currency up 2%—and the pound by nearly 4%—relative to the dollar. - Japan's economy grew by 1.6%fueled by infrastructure MSCI ACWI 14.8% development ahead of the 2020 Olympics,enabling the yen MSCI World 13.6% to surge by 6%relative to the dollar. - The only sectors that posted positive returns were Consumer MSCI ACWI ex USA _ 16.5% Discretionary,Tech,and Utilities. MSCI World ex USA 13.9% - Positive earnings supported the Tech sector(top performer), and Utilities benefited as investors fled to safety amid market MSCI ACWI ex USA Small Cap 20.6% volatility and yield curve flattening in March. - Telecom struggled as competition for wireless services MSCI World ex USA Small Cap 21.2% within the euro-zone eroded profitability,and Staples was MSCI Europe ex UK 15.5% notably challenged due to fears of interest rate normalization and the prospect of beleaguered growth. MSCI United Kingdom - 11.9% - Growth outpaced value and earnings growth and quality factors were in favor as markets were jittery in light of the MSCI Pacific ex Japan ■ 8.4% aforementioned looming risks.As such,high beta cyclical sectors and factors struggled. MSCI Japan _ 19.6% MSCI Emerging Markets — 24.9% MSCI China 38.9% MSCI Frontier Markets 27.3% Souroa:MSCI Callan Capital Market Overview(continued) March 31, 2018 Emerging Markets(MSCI EM:+1.4%) U.S.Fixed Income:Quarterly Returns - Brazil and Russia were among the best performers due to climbing oil prices and improving economic conditions. Blmberg Barclays Gov/Cr 1-3 Yr -0.2% I - China continued to thrive despite U.S.-China trade tension and a slowdown for Chinese Tech companies;China's Blmberg Barclays Intern Gov/Cr -1.0% , supply-side reforms are kicking in and economic growth in retail and home sales exceeded expectations,driving up Blmberg Barclays Aggregate -1.5% ■ returns for the Financials and Real Estate sectors. - Although India announced better-than-expected GDP growth Blmberg Barclays Long Gov/Cr .3.6% _ of 7.2%,the country notably lagged due to poor market sentiment surrounding asset-quality issues at large state-owned banks and relative valuations of Indian equities. Blmberg Barclays Universal -1.4% ■ - Energy was the best performer supported by rising oil prices; CS Leveraged Loans ■ 1.6% conversely,Consumer Discretionary was the worst sector performer,weighed down by India. , - Value and sentiment factorswere in favor as the economic Blmberg Barclays High Yield -0.9% recovery story gained traction and momentum;however, quality factors also added value given the mid-cycle of the Blmberg Barclays TIPS -0.8% recovery. International Small Cap(MSCI World ex USA Small Cap: U.S.Fixed Income:One-Year Returns -0.5%;MSCI EM Small Cap:+0.2%) - Developed non-U.S.small cop outperformed large cap given Blmberg Barclays Gov/Cr 1-3 Yr 10.2% the risk-on market environment spurred by synchronized global growth,although within Emerging Markets,small cap lagged large cap. Blmberg Barclays Intern Gov/Cr ' 0.4% - Growth was favored in both developed and emerging market Blmberg Barclays Aggregate ■ 1.2% small cap as growth-oriented sectors such as Health Care and Consumer Staples outperformed cyclical sectors. Blmberg Barclays Long Gov/Cr 5.1% FIXED INCOME Going into 2018,U.S.markets continued to rally higher due to Blmberg Barclays Universal ■ 1.6% solid economic data,passage of the U.S.tax reform,and rising expectations for corporate earnings growth. However,optimism CS Leveraged Loans 4.6% quickly vanished as investors turned their focus to rising wage pressures,policy uncertainties surrounding the new incoming Blmberg Barclays High Yield 3.8% Fed Chair Jerome Powell,and escalating trade tensions between the U.S.and China.The 10-year U.S.Treasury yield steadily rose to nearly 3%from a low of 2.41%at the start of Blmberg Barclays TIPS 0.9% the year,before declining to close the quarter at 2.74%. Corporate risk premia similarly tightened then widened for both investment grade and high yield corporates.Strong investor U.S.Treasury Yield Curves demand and fewer new corporate issuances compared to the same period last year helped offset some of the declines from March 31,2018 December 31,2017 rising rates and increased spread volatility during the quarter. +Mamh 31,2017 4% The Bloomberg Barclays US Aggregate Bond Index 3% returned-1.5% - Volatility picked up across risk assets as geopolitical 2% uncertainties took center stage;market expectations reflect 1% the possibility of four rate hikes,up from three at the end of 2017. 0% 0 5 10 15 20 25 30 - Interest rates rose-30bps across the U.S.Treasury yield Maturity(Yearn) curve. - The 10-year U.S.Treasury yield rose from 2.41%to 2.74%. Sources:Bloomberg,Bloomberg Barclays,Credit Suisse Callan Capital Market Overview(continued) March 31, 2018 Investment grade corporates returned-2.3%and Global Fixed Income:Quarterly Returns underperformed the Aggregate Index — Investors were fairly sanguine as they reassessed fairly Blmberg Bemlays GI Aggregate , 1.4% healthy balance sheets juxtaposed with fair/rich valuations. — New issuance was down 13%when compared to a similar Blmberg Barclays GI Agg(hdg) -0.1 time period a year ago,yet demand remained strong with 2- 3x oversubscriptions. Blmberg Barclays GI High Yield -0.4% High yield corporates returned-0.9%and outperformed the US Aggregate Index Blmberg Barclays GI Agg ex US 3.6% — Corporate fundamentals remained healthy as earnings growth supported debt coverage. JPM EMBI Global Diversified -1.7% 0 — Default rates remained benign because many companies JPM GBI-EM Global Diversified - d.d% had already reorganized debt in 2016. — Approx.75%of new issuance proceeds were used for JPM EMBI GI Div/JPM GBI-EM GI Div , 1.3% refinancing. — Valuations remained near historical highs. JPM CEMBI -1.2% Bank loans returned+1.4%and outperformed the Aggregate. — Healthy balance sheets,strong demand for CLO formation, Global Fixed Income:One-Year Returns and higher short-term interest rates bode well for the sector this quarter. Blmberg Barclays GI Aggregate = 7.0% — Demand from CLO formation continued to lead to interest in bankloans. Blmberg Barclays GI Agg(hdg) 2.5% EMD returned+4.4%as returns were positive for most countries in local currency terms. Blmberg Barclays GI High Yield = 6.6% — Mexico, 10%by weight of the Index,returned 11%due mostly to strong appreciation of the Mexican peso on Blmberg Barclays GI Agg ex US 11]% speculation that an agreement would be reached on NAFTA. — South Africa,also 10%of the Index,returned 13%from the JPM EMBI Global Diversified ■ 4.3% rend hitting a multi-year high after scandal-ridden President Zuma resigned.Falling rates also supported performance. JPM GBI-EM Global Diversified — 13.0% JPM EMBI GI DIv/JPM GBI-EM GI Div _ 8.6% JPM CEMBI ■ 3.3% Change in 10-Year Global Government Bond Yields 4017 to 1018 U.S.Treasury 33 bps Germany _ ]bps U.K. — 16 bps Canada = 5 bps Japan 0 bps Sources:Bloomberg,Bloomberg Bardays,JP Morgan Callan Active Management Overview Market Overview Active Management vs Index Returns Market Overview The charts below illustrate the range of returns across managers in Callan's Separate Account database over the most recent one quarter and one year time periods. The database is broken down by asset class to illustrate the difference in returns across those asset classes.An appropriate index is also shown for each asset class for comparison purposes.As an example, the 0rsl bar in the upper chart illustrates the range of returns for domestic equity managers over the last quarter. The triangle represents the S&P 500 return. The number next to the triangle represents the ranking of the S&P 500 in the Large Cap Equity manager database. Range of Separate Account Manager Returns by Asset Class One Quarter Ended March 31,2018 8% 8% 4% (34)® E 2% (41) a% (39) (2%) P41 ODD (4%) (6%) large Cap Smell Cep Non-US Domestic Non-US Real Equity Equity Equity Fixed Income Fixed Income Estate s s vs vs S&p SOU Russell 2000 MSCI EAFE Blmbg Aggr Bd Citi Non43S G.A NCREIF Index 10ih Percentile 4.86 553 0.69 (1.10) 4.83 2.60 25M lands i 2.00 305)) ((0.0177 E(1.193) 449 2.15 15M Percentile 1.!34(3.10edian � 12 98) (2.28) (1.55) 2 95 ( 83 0 50) 90ih Percentile Index • (076) (0,08) (1.53) (146) 442 1,80 Range of Separate Account Manager Returns by Asset Class One Year Ended March 31,2018 30% 25% 20% c 1S% (53)• (77)7 K (50) (33)® 10% (47) 5% 0% (85)111� Large Cap Small Cap Non-US Domestic Non-US Real Equity Equity Equity Fixed Income Fixed Income Estate eapao) Russell 2000 MBCIEAFE Blmbg Aggr Bd Giti Non USGo" NCREIF Index 10M Percentile 23.30 2643 23.28 2.16 13.62 11.18 25ih Percentile 20.73 WAS 19.97 1,88 13.17 644 Median 14.82 11.98 11.40 1.65 12.55 6.87 75th Percentile 11.01 168 15.01 143 11.22 4.91 90th Percentile 0.50 4.88 13.14 1.03 10.85 1.66 '� Index • 13.99 11.79 14.80 1.20 12.93 7.22 Callan Crease Comity Sanitation Decoct 7 Domestic Fixed Income Active Management Overview The 10-year U.S. Treasury yield marched steadily higher through most of January and February in response to positive economic data,then equity market weakness and concerns over a looming trade war led to falling yields through March.The new Fed Chair,Jerome Powell,announced his first rate hike(as widely expected)in March,raising the Fed Funds target rate to 1.50% 1.75%. The 10-year U.S. Treasury yield climbed to a peak of nearly 3% during the quarter before closing at 2.74%, 34 bps higher than at year-end.Two-year U.S.Treasury Note yields rose nearly 40 bps to 2.27%, the highest since 2008, and the Note returned-0.1%for the quarter,while the 10-year Treasury returned-2.4% and the 30-year Treasury fell almost 4%. TIPS outperformed nominal Treasuries and the 10-year breakeven inflation rate rose to 2.05% from 1.96% at year-end. The Bloomberg Barclays U.S. Aggregate Index fell 1.5% with corporate and securitized sectors underperforming Treasuries. In a sharp reversal from 2017's relative performance, investment grade corporates underperformed like-duration Treasuries by 80 bps during the quarter and posted a -2.3% return. Outside of investment grade, the Bloomberg Barclays High Yield Index fell 0.9%while the S&P/LSTA Leveraged Loan Index,which includes foaling rate loans and thus benefited from rising rates, rose 1.4%. Separate Account Style Group Median Returns for Quarter Ended March 31,2018 Blmng Aggregate. (1.46%) 3% Blmbg High Yield (086%) Blmbg Long GovlCrad- (358%) 2% 1.39 1% 0% c H%) _________(0.93) 70797 ______________(1. )___(11.20)_ (2%I ____________ (3%) (4%) _______________________­f3ei-)______________ (5%) Defensive Interned Case Core Plus Extended Bank High Yield Band Maturity Loans Separate Account Style Group Median Returns for One Year Ended March 31,2018 Blmhg Aggregate: 1.20% ]% Blmbg High Yield: 3.78% Blmbg Long Gov/Creel 5,09% 6% 5.34 5% ______________________ ____________ d.86 4.24 c4% --______________________ lit N 2.31 2% _______________1.6_5 1% ____y.9g___4-_ 0% Defensive Interned Case Core Plus Extended Bank High Yield Callan Maturity Loans Callancurse,County sanitation District a Asset Allocation Investment Manager Asset Allocation The table below contrasts the distribution of assets across the Fund's investment managers as of March 31, 2018, with the distribution as of December 31,2017.The change in asset distribution is broken down into the dollar change due to Net New Investment and the dollar change due to Investment Return. Asset Distribution Across Investment Managers March 31,2018 December 31,2017 Market Value Weight Net New Inv. Inv.Return Market Value Weight Domestic Filed Income long Term Operating Fund' 412,837,715 81.54% 17,600,000 (1.254.966) 396.592.680 73.16% liquid ODeratina Monies' 92,867,993 18.36% (53.000.000) 368,357 145.499.636 26.04% Total Fund 8505,705,708 100.0% Wsso0,000) S(886,608) $542,092,317 100.0% 'Chandler replaced PIMCO during the 4th Quarter of 2014.Assets were transferred In+lnd as of 1001I2014. Callan coerce county Sandation District 10 Investment Manager Returns The table below details the rates of return for the Fund's investment managers over various time periods ended March 31, 2018. Negative retums are shown in red, positive returns in black. Returns for one year or greater are annualized. The first set of returns for each asset class represents the composite returns for all the fund's accounts for that asset class. Returns for Periods Ended March 31,2018 Last Last Last Last Last 3 5 7 Quarter Year Years Years Years Domestic Fixed Income Long Term Operating FundA (0.31%) 0.35% 0.85% 0.66% 1.51% Chandler (0.31%) 0.35% 0.85% - Blmbg Govl/Cred 1-5 Year Idx (0.50%) 0.19% 0.77% 0.95% 1.44% ML 1-5 Govt/Corp (0.49%) 0.22% 0.81% 0.99% 1.50% Liquid Operating MoniesA 0.34% 1.10% 0.63% 0.42% 0.35% Chandler 0.34% 1.10% 0.63% - - Citigroup 3-Month Treasury Bill 0.35% 1.07% 0.49% 0.31% 0,24% Total Fund (0.14%) 0.45% 0.72% 0.58% 1.28% Target* (0,32%) 0.39% 0.75% 0,86% 1,25% Current Quarter Target=80.0%ML US Corp/Gov:1-5Y and 20.0%Citi 3 Mo T-Bill. ^Assets were transferred in kind to Chandler on 12/112014.Previous performance reflects PIMCO. Callan Onan,Cnmrty Santleann DlsNtl „ Investment Manager Returns The table below details the rates of return for the Fund's investment managers over various time periods ended March 31, 2018. Negative retums are shown in red, positive returns in black. Returns for one year or greater are annualized. The first set of returns for each asset class represents the composite returns for all the fund's accounts for that asset class. Returns for Periods Ended March 31,2018 Last Last Last 10 15 22.1/2 Years Years Years Domestic Fixed Income Long Term Operating FundA 2.33% 2.97% 4.26% Blmbg GovUCred 1-5 Year Idz 2.11% 2.73% 4.07% ML 1-5 Govt/Corp 2.16% 2.75% 4.10% Liquid Operating Monies^ 0.49% 1.42% 2.60% Citigroup 3-Month Treasury Bill 0.31% 1.21% 2.29% Total Fund 1.99% 2.68% 4.00% Target` 1.79% 2.44% 3.74% Current Quarter Target=80.0%MIL US Corp/Gov:1-5Y and 20.0%Citi 3 Mo T-Bill. ^Assets were transferred in kind to Chandler on 12/112014.Previous performance reflects PIMCO. Callan Onar,County Sandarinn Distnd 12 Investment Manager Returns The table below details the rates of return for the Fund's investment managers over various time periods. Negative returns are shown in red, positive returns in black. Returns for one year or greater are annualized. The first set of returns for each asset class represents the composite returns for all the fund's accounts for that asset class. 12/2017- 3/2018 2017 2016 2015 2014 Domestic Fixed Income Long Term Operating Fund^ (0.31%) 1.18% 1.58% 0.85% 1.98% Chandler (0,31%) 1.18% 1.58% 0.85% - Blmbg Govl/Cred 1-5 Year Idx (0.50%) 1.27% 1.56% 0.97% 1.42% ML 1-5 Govt/Com (0.49%) 1.28% 1.62% 1.05% 1.51% Liquid Operating Monies^ 0.34% 0.91% 0.47% 0.22% 0.09% Chandler 0.34% 0.91% 0.47% 0.22% - Citiarouo 3-Month Treasury Bill 0.35% 0.84% 0.27% 0.03% 0.03% Total Fund (0.14%) 1.02% 1.15% 0.80% 1.73% Target* (0.32%) 1.19% 1.35% 0.85% 1.21% *Current Quarter Target=80.0%MIL US Corp/Gov:1-5Y and 20.0%Citi 3 Mo T-Bill. ^Assets were transferred in kind to Chandler on 12/112014.Previous performance reflects PIMCO. Callan 0mr,,e County Santle,Inn mistnd „ Investment Manager Returns The table below details the rates of return for the Fund's investment managers over various time periods. Negative returns are shown in red, positive returns in black. Returns for one year or greater are annualized. The first set of returns for each asset class represents the composite returns for all the fund's accounts for that asset class. 2013 2012 2011 2010 2009 Domestic Fixed Income Long Term Operating Fund^ (1.77%) 3.06% 4.59% 4.42% 5.52% Blmbg Govt/Cred 1-5 Year Idx 0.28% 2.24% 3.14% 4.08% 4,62% ML1-S Govt/Corp 0.32% 2.47% 3.10% 4.17% 4.88% Liquid Operating Monies- 0.13% 0,17% 0.24% 0,25% 0,58% Ciligroup 3-Month Treasury Bill 0.05% 0.07% 0.08% 0.13% 0.16% Total Fund (1.49%) 2.70% 3.70% 3.68% 4.65% Target` 0.26% 1.99% 2.49% 3.36% 3.93% Current Quarter Target=80.0%MIL US Corp/Govl 1-5Y and 20.0%Citi 3 Mo T-Bill. Callan were transferred in kind to Chandler on 12/112014.Previous performance reflects PIMCO. Callan Crarxre County Sandarinn DisNtl 14 Asset Class Risk and Return The charts below show the seven year annualized risk and return for each asset class component of the Total Fund.The first graph contrasts these values with those of the appropriate index for each asset class.The second chart contrasts them with the risk and return of the median portfolio in each of the appropriate CAI comparative databases. In each case, the crosshairs on the chart represent the return and risk of the Total Fund. Seven Year Annualized Risk vs Return Asset Classes vs Benchmark Indices 1.2% 1.0% N K 0.8% 0.6% 0.4% 0.2% �Y'l•1Y�•iyl• 0.0% 0.0% 02% 04% O6% 0.8% 1.0% 1.2% 1.4% Standard Deviation Seven Year Annualized Risk vs Return Asset Classes vs Asset Class Median 18% 16% r. . 1.4% 1.2% 1.0% N K 0.8% 0.6% 0.4% 0.2% 0.0% 0.0% 02% 04% O6% 0.8% 10% 1.2% 1.4% ,.., 1,, Standard Deviation Callan Omrr County Sandation Oisftt 15 Manager Analysis Chandler-Long Term Operating Fund Period Ended March 31, 2018 Investment Philosophy Chandler Asset Management's Short Term Bond strategy is driven by quantitative models and focuses on active duration management,sector selection and term structure.The strategy seeks to achieve consistent above-benchmark returns with low volatility relative to the style's performance benchmark. The firm has a unique focus on high quality fixed income management, and places risk control as a higher objective than return. Assets were transferred in kind to Chandler on 12/l/2014.Previous performance reflects PIMCO. Quarterly Summary and Highlights Quarterly Asset Growth • Long Term Operating Fund's portfolio posted a (0.31)% Beginning Market Value $396,592,680 return for the quarter placing it in the 84 percentile of the Net New Investment $17,500,000 Callan Defensive Fixed Income group for the quarter and in Investment Gains/(Losses) $-1,254,966 the 90 percentile for the last year. • Long Term Operating Fund's portfolio outperformed the ML Ending Market Value $412,837,715 US Corp/Govt 1-5Y by 0.18% for the quarter and outperformed the ML US Corp/Govt 1-5Y for the year by 0.13%. Performance vs Callan Defensive Fixed Income(Gross) 6% 5% (( ) 4% 29)®B(3 ) 3% qq(( pp ( 1% 9 3)®B(8 81®Bl] 5) 6 31)®B(5. �N� B�6 0% 0%) 95) B9 (2%) Last Otr Last Last3 Yrs Chandler Last 5Yrs L•st]Y. L•910Yrs Since RM0155 Yr Incephon 101h Percentile 0.11 154 1,67 1.87 1.66 2.16 3.31 443 25M Peroen111e (005 1.11 1,39 1,59 141 in 257 4.15 Metlien 110.1] 0.86 104 1.18 1.09 1.51 2,17 390 ]51h Percentile 10.28 0.51 0.91 1.038 1091 1.20 1.89 3.69 901h Percentile (0.40 0.35 0.71 0.85 0.]] 0.89 1.28 3.33 Long Term Operating Fund •A (0.31) 0.35 0.85 1.01 offs 1.51 2.33 4.26 Blmbg G.Wcred 1-5 Year Idx •B (050) 0.19 O.n 1,01 0,95 1." 2.11 Corr ML US ComlGon l-S • (0.49) 0.22 0,81 1.06 0.99 1.50 2.16 4.10 Callan Defensive Fixed Income(Gross) Relative Return vs ML US Corp/Govt 1-SY Annualized Seven Year Risk vs Return 2.0% 4.5% 4.0% 3.5% E1.0% 3.0% 05% _ __ __ __ __ __ E2.5% o.o% z.o% 1.0% • - (1.5%) 0.0% 2011 2012 2013 2014 2015 2018 2017 18 0.0 0.5 1.0 1.5 2.0 25 30 3.5 0 Long Term Operating Fund Standard Deviation C/'�,� 1,� allan Omlge County Sanitation DishkA 17 Long Term Operating Fund Return Analysis Summary Return Analysis The graphs below analyze the manager's return on both a risk-adjusted and unadjusted basis.The first chart illustrates the manager's ranking over different periods versus the appropriate style group.The second chart shows the historical quarterly and cumulative manager returns versus the appropriate market benchmark. The last chart illustrates the manager's ranking relative to their style using various risk-adjusted return measures. Assets were transferred in kind to Chandler on 12M/2014. Previous performance reflects PIMCO. Performance vs Callan Defensive Fixed Income(Gross) 14 2fi2 �g0 1 a B �- A g A 2]®B 8 "B((( �1yW*BIOM2�.AI Al assill., ! B 5 A10 ) 4kk 12117-L10 M17 2016 2015 2014 2013 M12 2011 2010 2009 loth Percendle 0.11 2.26 2.82 1.17 150 1.20 4.46 292 471 13.74 25th Pemendle (0.05) 1.74 2.12 1.01 1.27 0.81 2.80 280 4el 8.60 Median (0.17) t31 t58 081 1.11 065 181 185 3.18 5.94 15th Percentile (0.20) 0.93 1.186 075 1087 040 145 165 2J2 2.53 sell Percentile (0.40) O.66 1.03 0 fi4 0.73 0.29 0.92 1.44 241 1.82 Long Term Oavaung Fund *A (0.31) 1.18 158 085 1,98 (177) 306 459 4A2 5.52 Blm GOWCred -5 Year 1& ■B (0.50) 1.27 1.56 0.99 1.42 0.28 2.24 3.14 4cli 4.62 ML US Cor,/GO 15Y ♦ (0.49) 1.28 1.62 105 1.51 0.32 2.47 3.10 4.9 4.00 Cumulative and Quarterly Relative Return vs ML US Corp/Govt 1-SY 5% 4% 3% 2% -- --- - ----- -- u of 1% m 0% m0%) -_ __ - - ---___ - --- --- --- ----- d � (2%) (3%) (4%) 2036 2009 2010 2011 2012 M13 2014 2015 2016 2017 10 Long Term Operebng Fund 0 Blmbg Gn VCral 15 Year Idx Callan Defensive Fix Inc Risk Adjusted Return Measures vs ML US Corp/Gout 1-SY Rankings Against Callan Defensive Fixed Income(Gross) Seven Years Ended March 31,2018 5 20 1.5 1 0 AI95� OS 0.0 B 93 (0.5) B(90) le) (1.5) Alpha Sharpe Exceaa Relum Rat10 Redo 10h Percentlle 1.11 1.90 0.87 25th Percentile 0.79 1.58 0.53 Median 0.39 1.42 0.01 75th Percen118 0.21 1.21 053 Air Percentile 0.03 1.04 0.83 Longg Term Operebng Fund *A 0.05 0.79 0.01 Blmbg GovVCred 1-5 Vear ltlx ■B 0.08 0.95 (0.82) Callan Orarcg County sanitation Distinct 18 Long Term Operating Fund Bond Characteristics Analysis Summary Portfolio Characteristics This graph compares the managers portfolio characteristics with the range of characteristics for the portfolios which make up the manager's style group. This analysis illustrates whether the manager's current holdings are Consistent with other managers employing the same style. Fixed Income Portfolio Characteristics Rankings Against Callan Defensive Fixed Income as of March 31,2018 5 4 3 6) (1)♦ •(4) (��) (75)Lz4(93) (56)® z N a )t 9 (1) Average Eased. Coupon OA Duration 'it. Yield RMe convexity 101h Pemendle 2.16 3.88 3.62 3.03 0.07 250h Pemen0le 1.93 2.32 2.94 208 005 Medlan 1.70 2.00 2.73 2.33 0.03 75th Percenl 1.46 1.T9 2.62 205 ool 9M Pemen0le 0.85 1.09 2.51 1.99 (0.09) Long Term Operating Fund • 2.41 2.51 2.42 1.90 - elmb9 Gov/Cred 1-5 Yr ♦ 2.73 2.87 2.62 2.26 0.10 Sector Allocation and Quality Ratings The first graph compares the managers sector allocation with the average allocation across all the members of the manager's style.The second graph compares the manager's weighted average quality rating with the range of quality ratings for the style. Sector Allocation Quality Ratings March 31,2018 vs Callan Defensive Fixed Income Tray us.I ear �� .i____________ AM s M+ conp—i u.nl (10) a. (44) M- A, rvxeumpua uri A A Weighted Average quality Rating GwR 10M Percentile M, 25m Percentile M cm Median M- 751h Percentile A, 901h Percentile A 0% 10% 20% 30% 60% 50% 60% 70% 80% Long Term Operating Funtl Callan Defensive Fixatl Income Long Term Operating Fund 0 M Callan 0 Blmbg Gw/Cmd 1-5 Yr Blmbg GevlCmd 1-5 Yr ♦ M, Cellar l Orange County Sanitation Distnd 19 Long Term Operating Fund Portfolio Characteristics Summary As of March 31, 2018 Portfolio Structure Comparison The charts below compare the structure of the portfolio to that of the index from the three perspectives that have the greatest influence on return. The first chart compares the two portfolios across sectors. The second chart compares the duration distribution.The last chart compares the distribution across quality ratings. Sector Allocation US Tray US Trey 32% 61% CMOs ABS 1% 6% Other RMBS 14% 23% Cm,h Gov Related 3%< % Tax-Evem%US Muni Cary((ind 144A) Cory(21 lddA) 1% R]% 21% Long Term Operating Fund Blmbg Govt/Credit 1.5 Year Weighted Average: Duration Duration Distribution ■ Long Term Operetlng Fund: 2.41 80% ■ ginning GOWC%dlt l-s Year 2.73 o 70% ____________ ______ ______ 0 60% _________ 59.9 ______ ______ d50% _________ ______ ______ ______ ______ ______ N R 10% o% 0.4 is—--——— —————— —————— <1 1-3 3s s-] 7-10 .10 Years Duration aWelgh�dge: Gaallly Duality Distribution Oyemting Fund:100% Cmdit l-5 Year: M+•80% ______ ___ ___ __ ___ __ _ ___68 B 62L5 60% _ ___ ___ __ ___ __40% _ ___ ___ __ ___ __ _ ___4 20% 0-6i3.313L —TL"S8.9 6] 0% APA PA A BBB Be B CCC CC C 0 NIR Quality Rating Callan OraMre county Sandation District 26 Chandler-Liquid Operating Money Period Ended March 31, 2018 Investment Philosophy Assets were transferred in kind to Chandler on 12/1/2014. Previous performance reflects PIMCO. Quarterly Summary and Highlights Quarterly Asset Growth • Liquid Operating Money Net's portfolio posted a 0,30% Beginning Market Value $145.499,636 return for the quarter placing it in the 28 percentile of the Net New Investment $-53,000,000 Callan Money Market Funds group for the quarter and in the 29 percentile for the last year. Investment Gains/(Losses) $368,357 • Liquid Operating Money Nefs portfolio underperformed the Ending Market Value $92,867,993 Citigroup 3-Month Treasury Bill by 0.05%for the quarter and underperformed the Citigroup 3-Month Treasury Bill for the year by 0.12%. Performance vs Callan Money Market Funds(Net) 2.5% 9)�2.0% 1.5% 1.0% 21) N(29 . % 22) (24 22)P(23 (9) (26 20)6I2e 21t®I26 33) Izs ou% Lwt Utr Leaf Last 3 Ym Chandler Last 5Yrs Last 7Ym LastlOYrs Slnm9nOMS Yr Incepgon 10T Percentile 035 120 0.91 0,87 060 0.38 050 2A6 25M Percentile 0.31 1020 046 0.42 0.28 0.21 0.35 2.33 Median 0.26 080 0,33 0.31 0.20 0.14 0.24 2.16 75th Percentile 020 059 0,22 0,21 0,14 0.10 oA8 205 90T Percentile 0,14 039 0,13 0,12 ow 0.06 0,14 190 Llquld Operating Money Net 0 030 095 047 044 0,27 020 034 2A5 Ciligmup 3-Month Treasury Bill ♦ 0.35 107 049 0.46 0.31 0.24 0.31 2.29 Relative Returns vs Callan Money Market Funds(Net) Citigroup 3-Month Treasury Bill Annualized Seven Year Risk vs Return 0.10% 20% 008% - -- -- -- -- -- -- 18% 0.06% _ __ __ __ __ __ __ 1.6% - 1.4% 0.02% - __ __ __ - __ __ m1.2% e = 1.0% 2000% u � m 0.8% (0.02%) _ 0.6% (0.04%) _ __ __ __ __ __ _ - 04% (0.08%) 0.0% 2011 2012 2013 2014 2015 2016 2017 18 0D 05 10 15 2.0 2.5 /'�,, 1,.. ■L'puia operating Money rvet Standard Deviation Callan Oran,e County Sanitation Oistdct 21 Liquid Operating Money Net Return Analysis Summary Return Analysis The graphs below analyze the manager's return on both a risk-adjusted and unadjusted basis.The first chart illustrates the manager's ranking over different periods versus the appropriate style group.The second chart shows the historical quarterly and cumulative manager returns versus the appropriate market benchmark. The last chart illustrates the manager's ranking relative to their style using various risk-adjusted return measures. Assets were transferred in kind to Chandler on 12M/2014. Previous performance reflects PIMCC. Performance vs Callan Money Market Funds(Net) 6% 4% 1.2% 1.0% 6 0.8% •32 O.fi% OA% 9 28 29 26 •16 0.2% 11 12 P 4T 0.0% 0.2%) 0.4%) 12117 3118 M17 2016 2015 2014 2013 M12 2011 2010 2009 10ah Perwre8e 0.35 1.32 106 026 0.23 0.13 026 0.10 0.17 0.60 25tb Pecentle 031 0.87 032 red 0.02 003 005 003 O.OT 0.31 Median 0.26 0.61 0.13 0.01 0.01 0.01 0.01 0.01 0.02 0.15 75th Pecendle 0.20 0.42 0.04 0.01 0.01 0.01 0.01 0.01 0.01 0.05 Mh Percende 0.14 0.25 001 000 due 0.00 000 000 ace 0.02 Liquid Operating Money Net 01 0.30 0.76 0.32 00] (0.06) (0.02) 0.02 0.09 0.10 0.43 Citi9rwp 3-Mordh Treasury Bill ♦ 0.35 o" 0.27 003 0.03 0.05 0.07 0.08 0.13 0.16 Cumulative and Quarterly Relative Return vs Citigroup 3-Month Treasury Bill o.To% oao% o.so% _______________ 'u 0.1% __ ___ ____________ y 020% _ ___'a 0.10% _ d 0.00% (0.10%) (0.20%) (0.30%) 2000 2009 2010 2011 2012 M13 2014 2015 2016 2017 10 10 Liquid Opened,Money Net 0Callan Monay MaAat Funds Risk Adjusted Return Measures vs Citigroup 3-Month Treasury BIII Rankings Against Callan Money Market Funds(Net) Seven Years Ended March 31,2018 15 10 06 o0 8) (0.5) (1.0) (1.5) (2.0) (2.5) (3.0) (35) /dpha She rye Excess Retum Ratio Ratio 10b Percentile 0.16 0.26 1.00 25tb Percentila 10.02) 0.31) 0.84 Median 0.09 O.ad 1.53 75th Percentile (0.13) 1 ) 1.81 stab Percentile (0.16) (2.T6) 2.10 /'� Liquid Operating Money Net • M 05) (0.36) (0.84) Callan Orange County Sandation Oistdct 2 Callan Research/Education CALLAN Callan INSTITUTE 1st Quarter 2018 Education Research and Educational Programs The Callan Institute provides research to update clients on the latest industry trends and carefully structured educational programs to enhance the knowledge of industry professionals.Visit www.callan.com/library to see all of our publications,and www.callan.com/blog to view our blog"Perspectives."For more information contact Cony Walsh at 312.346.3536/institute@callan.com. New Research from Callan's Experts The Callan Periodic Table of Investment 2018 DC Trends Survey I Callan's 11th Annual DC Trends Survey Returns I We are pleased to offer both our from our Defined Contribution Group highlights plan sponsors'key Classic Periodic Table, depicting annual re- themes from 2017 and expectations for 2018. turns for 10 asset classes ranked from best to worst performance for each calendar year, Periodicals and our Collection,offering 10 additional versions,including real es- Hedge Fund Monitor, list Quarter 20181 Jim McKee explains tate indices, hedge fund strategy indices, and key indices ranked Form ADV changes and how to use them to evaluate advisers. relative to inflation. DC Observer,tat Quarter 2018I Non-qualified deferred romper. Callan's 2018-2027 Capital Market Projections I Callan develops salion plans(NQDCs) may look and sound like qualified defined long-tent capital market projections at the start of each year,detail- contribution (DC) plans, but the two are actually quite different. ing our expectations for return,volatility, and correlation for broad This quarter's commentary explores approaches to designing the asset classes.These projections represent our best thinking regard- NQDC plan investment menu as well as some of the consider- ing a longer-term outlook and are critical for strategic planning as ations around informally funding the liabilities. our investor clients set investment expectations over five-year,ten- year,and longer time horizons. Active vs. Passive Report, 4th Quarter 2017 1 This series of chars maps active managers alongside relevant benchmarks How Callan Categorizes Multi-Asset over the last two decades. Class Strategies I In the wake of the 3D Global Financial Crisis, a new genera- Market Pulse Flipbook, 4th Quarter 2017 1 A quarterly market tion of multi-asset class(MAC)products reference guide covering investment and fund sponsor trends in emerged that emphasized risk manage- the U.S. economy, U.S. and non-U.S. equities and fixed income, ment and expanded their toolkits to include shorting and derivatives. alternatives.and defined contribution. Callan groups these'outcome-oriented"MACS into four broad cate- gories:Risk Parity,Risk Frannie,Absolute Return,and Long Biased. Capital Market Review,4th Quarter 2017 1 This quarterly pub- lication provides analysis and a broad overview of the economy Treasuries for the Long Run I Callan's James Van Haul ana- and public and private market activity each quarter across a wide lyzed whether long-term Treasuries can serve as an effective hedge range of asset classes. against equity losses.He concluded that long-term Treasuries have a mixed record of offseffing equity risk.The potential protection of- Private Markets Trends,Winter 2018 1 This newsletter offers the fered by long-term Treasudes comes with the disk of underperfor- latest data on activity in private equity fundraising, buyouts, ven- mance over some time periods. Other types of bonds, he found, ture capital,and returns for this asset class. may offer less protection,but also have less volatility. The Center for Investment Training Events Educational Sessions Miss out on a Callan conference or workshop? Event summa- The Center for Investment Training, better known as the -Callan des and speakers presentations are available on our websile: College;provides a foundation of knowledge for industry profes- www.callan.com/library/ sionals who are involved in the investment decision-making pro- Callan's June Regional Workshops will be held on June 12 in San cess.It was founded in 1994 to provide clients and non-clients alike Francisco and June 13 in Denver. Please visit our Event page on with basic-to intermediate-level instruction.Our next sessions are: our websile(hRps://w.w+.callan.com/events)for additional infonna- Introduction to Investments lion on these workshops. San Francisco,July 24-25,2018 We've added on-demand webinars to our online research library. Chicago, October 2-3, 2018 Access our library of pre-recorded webinars on specific invest- This program familiarizes fund sponsor trustees, staff, and asset ment-related topics at www.callan.com/ondemandwebinar/. management advisers with basic investment theory,terminology, and practices. It lasts one-and-a-half days and is designed for in- For more information about events, please contact Barb dividuals who have less than two years of experience with asset- Gerraty:415.274.3093/gerraty@callan.eom management oversight and/or support responsibilities.Tuition for the Introductory "Callan College" session is $2,350 per person. Tuition includes instruction, all materials, breakfast and lunch on each day,and dinner on the first evening with the Instructors. Customized Sessions The "Callan College" is equipped to customize a curriculum to meet the training and educational needs of a specific organization. These tailored sessions range from basic to advanced and can take place anywhere even at your office. Learn more at www.callan.com/eventsicallan-college-intro or contact Kathleen Curdle:415.274.3029/cunnie@callan.com Education: By the Numbers 525 Attendees(on average)of the 50+ Unique pieces of research the Institutes annual National Conference Institute generates each year 3 700 Total attendees of the'Callan 1980 Year the Callan Institute I College since 1994 was founded I "Research is the foundation of all we do at Callan, and sharing our best thinking with the investment community is our way of helping to foster dialog to raise the bar across the industry." Greg Alen,CEO and CRO Callan V @CaIIanLLC ID Callan Definitions Risk/Reward Statistics The risk statistics used in this report examine performance characteristics of a manager or a portfolio relative to a benchmark (market indicator) which assumes to represent overall movements in the asset class being considered. The main unit of analysis is the excess return, which is the portfolio return minus the return on a risk free asset (3 month T-Bill). R-Squared indicates the extent to which the variability of the portfolio returns are explained by market action. It can also be thought of as measuring the diversification relative to the appropriate benchmark. An r-squared value of.75 indicates that 75% of the fluctuation in a portfolio return is explained by market action. An r-squared of 1.0 indicates that a portfolio's returns are entirely related to the market and it is not influenced by other factors. An r-squared of zero indicates that no relationship exists between the portfolio's return and the market. Relative Standard Deviation is a simple measure of a managers risk(volatility)relative to a benchmark. It is calculated by dividing the manager's standard deviation of returns by the benchmark's standard deviation of returns. A relative standard deviation of 1.20,for example, means the manager has exhibited 20% more risk than the benchmark over that time period. A ratio of .80 would imply 20% less risk. This ratio is especially useful when analyzing the risk of investment grade fixed-income products where actual historical durations are not available. By using this relative risk measure over rolling time periods one can illustrate the "implied" historical duration patterns of the portfolio versus the benchmark. Residual Portfolio Risk is the unsystematic risk of a fund,the portion of the total risk unique to the fund(manager)itself and not related to the overall market. This reflects the"bets"which the manager places in that particular asset market. These bets may reflect emphasis in particular sectors, maturities (for bonds), or other issue specific factors which the manager considers a good investment opportunity. Diversification of the portfolio will reduce or eliminate the residual risk of that portfolio. Rising and Declining Periods refer to the sub-asset class cycles vis-a-vis the broader asset class. This is determined by evaluating the cumulative relative sub-asset class index performance to that of the broader asset class index. For example, to determine the Growth Style cycle, the S&P 500 Growth Index (sub-asset class) performance is compared to that of the S&P 500 Index(broader asset class). Sharpe Ratio is a commonly used measure of risk-adjusted return. It is calculated by subtracting the "risk-tree" return (usually 3 Month Treasury Bill)from the portfolio return and dividing the resulting"excess return" by the portfolio's risk level (standard deviation).The result is a measure of return gained per unit of risk taken. Sortino Ratio is a downside risk-adjusted measure of value-added. It measures excess return over a benchmark divided by downside risk. The natural appeal is that it identifies value-added per unit of truly bad risk. The danger of interpretation, however, lies in these two areas: (1)the statistical significance of the denominator,and (2) its reliance on the persistence of skewness in return distributions. Standard Deviation is a statistical measure of portfolio risk. It reflects the average deviation of the observations from their sample mean. Standard deviation is used as an estimate of risk since it measures how wide the range of returns typically is. The wider the typical range of returns,the higher the standard deviation of returns,and the higher the portfolio risk. If returns are normally distributed (Is. has a bell shaped curve distribution) then approximately 2/3 of the returns would occur within plus or minus one standard deviation from the sample mean. Total Portfolio Risk is a measure of the volatility of the quarterly excess returns of an asset. Total risk is composed of two measures of risk: market(non-diversifable or systematic)risk and residual(diversifiable or unsystematic) risk. The purpose of portfolio diversification is to reduce the residual risk of the portfolio. Callan 27 Risk/Reward Statistics Tracking Error is a statistical measure of a portfolio's risk relative to an index. It reflects the standard deviation of a portfolio's individual quarterly or monthly returns from the index's returns. Typically,the lower the Tracking Error, the more "Index-like"the portfolio. Traynor Ratio represents the portfolio's average excess return over a specified period divided by the beta relative to its benchmark over that same period. This measure reflects the reward over the risk-free rate relative to the systematic risk assumed. Note:Alpha,Total Risk,and Residual Risk are annualized. Callan 28 Fixed Income Portfolio Characteristics All Portfolio Characteristics are derived by first calculating the characteristics for each security, and then calculating the market value weighted average of these values for the portfolio. Allocation by Sector- Sector allocation is one of the tools which managers often use to add value without impacting the duration of the portfolio. The sector weights exhibit can be used to contrast a portfolio's weights with those of the index to identity any significant sector bets. Average Coupon-The average coupon is the market value weighted average coupon of all securities in the portfolio. The total portfolio coupon payments per year are divided by the total portfolio par value. Average Moody's Rating for Total Portfolio- A measure of the credit quality as determined by the individual security ratings. The ratings for each security, from Moody's Investor Service, are compiled into a composite rating for the whole portfolio. Quality symbols range from Aaa+ (highest investment quality-lowest credit risk)to C (lowest investment quality- highest credit risk). Average Option Adjusted(Effective)Convexity-Convexity is a measure of the portfolio's exposure to interest rate risk. It is a measure of how much the duration of the portfolio will change given a change in interest rates. Generally,securities with negative convexities are considered to be risky in that changes in interest rates will result in disadvantageous changes in duration. When a security's duration changes it indicates that the stream of expected future cash-flows has changed, generally having a significant impact on the value of the security. The option adjusted convexity for each security in the portfolio is calculated using models developed by Lehman Brothers and Salomon Brothers which determine the expected stream of cash-flows for the security based on various interest rate scenarios. Expected cash-flows take into account any put or call options embedded in the security, any expected sinking-fund paydowns or any expected mortgage principal prepayments. Average Option Adjusted(Effective)Duration- Duration is one measure of the portfolio's exposure to interest rate risk. Generally, the higher a portfolio's duration, the more that its value will change in response to interest rate changes. The option adjusted duration for each security in the portfolio is calculated using models developed by Lehman Brothers and Salomon Brothers which determine the expected stream of cash-flows for the security based on various interest rate scenarios. Expected cash-flows take into account any put or call options embedded in the security, any expected sinking-fund paydowns or any expected mortgage principal prepayments. Average Price-The average price is equal to the portfolio market value divided by the number of securities in the portfolio. Portfolios with an average price above par will tend to generate more current income than those with an average price below par. Average Years to Expected Maturity-This is a measure of the market-value-weighted average of the years to expected maturity across all of the securities in the portfolio. Expected years to maturity takes into account any put or call options embedded in the security, any expected sinking-fund paydowns or any expected mortgage principal prepayments. Average Years to Stated Maturity- The average years to stated maturity is the market value weighted average time to stated maturity for all securities in the portfolio. This measure does not take into account imbedded options, sinking fund paydowns,or prepayments. Current Yield-The current yield is the current annual income generated by the total portfolio market value. It is equal to the total portfolio coupon payments per year divided by the current total portfolio market value. Callan 29 Fixed Income Portfolio Characteristics Duration Dispersion- Duration dispersion is the market-value weighted standard deviation of the portfolio's individual security durations around the total portfolio duration. The higher the dispersion, the more variable the security durations relative to the total portfolio duration ('barbellness"), and the smaller the dispersion, the more concentrated the holdings' durations around the overall portfolio's ('bulletness"). The purpose of this statistic is to gauge the 'bulletness' or 'barbellness'of a portfolio relative to its total duration and to that of its benchmark index. Effective Yield-The effective yield is the actual total annualized return that would be realized if all securities in the portfolio were held to their expected maturities. Effective yield is calculated as the internal rate of return, using the current market value and all expected future interest and principal cash flows. This measure incorporates sinking fund paydowns,expected mortgage principal prepayments,and the exercise of any"in-the-money"imbedded put or call options. Weighted Average Life-The weighted average life of a security is the weighted average time to payment of all remaining principal. It is calculated by multiplying each expected future principal payment amount by the time left to the payment. This amount is then divided by the total amount of principal remaining. Weighted average life is commonly used as a measure of the investment life for pass-through security types for comparison to non-pass-through securities. Callan 30 Disclosures Callan 1 Quarterly List as of March 31, 2018 List of Callan's Investment Manager Clients Confidential-For Callan Client Use Only Callan takes its fiduciary and disclosure responsibilities to clients very seriously.We recognize that there are numerous potential words of interest encountered in the investment consulting industry and Mal it is our responsibility to manage those conflicts effectively and in the best interest of our dlents. Al Callan,we employ a robust process to Identify,manage,monitor and disclose potential conflicts on an ongoing basis. The list below is an important component of our conflicts management and disclosure process. It identities those investment managers Mat pay Callan fees for educational,consulting,software,database or reporting products and services. We update the list quarterly because we believe that our fund sponsor clients should know the investment managers Mat do business with Callan,particularly Moss investment manager clients that Me fund sponsor clients may be using or considering using.Please note that if an investment manager receives a product or service on a complimentary heals(e.g. attending and educational event),May are not included in the list below.Callan is committed to ensuring that we do not consider an investment manager's business relationship with Callan,or lack thereof,in performing evaluations for or making suggestions or recommendations to its other clients. Please refer to Callan's ADV Part 2A for a more detailed description of the services and products that Callan makes available to investment manager clients through our lnestutlonal Consulting Group,Independent Adviser Group and Fund Sponsor Consulting Group. Due to the complex corpore[e and organizational ownership structures of many Investment management firms,parent and affiliate firm relationships are not indicated on our list. Fund sponsor dients may request a copy of Me most currently available list at any time.Fund sponsor clients may also request specific information regarding the fees paid on Callan by particular fund manager clients. Per company policy,informal requests regarding fees are handled exclusively by Callan's Compliance Department. Acadian Asset Management LLC Chartwell Investment Partners AEGON USA Investment Management Citi US Pension Investments Affiliated Managers Group,Inc. Cleareddge Investments,LLC Alcentra Cohen&Steers Capital Management,Inc. AllianceBerostein Columbia Management Investment Advisers,LLC Allianz Global Investors Columbus Circle Investors Allianz Life Insurance Company of North America Cove Street Capital LLC American Century Investments Call Suisse Asset Management Apollo Global Management DePrince,Race&Zollo,Inc. AOR Capital Management D.E.Shaw Investment Management,L.L.C. Ares Management LLC Deutsche Asset Management Adel Investments,LLC Diamond Hill Capital Management,Inc. Artisan Holdings Dimensional Fund Advisors LP Atlanta Capital Management Co.,LLC Doubleline Aviva Investors Americas Duff&Phelps Investment Motor Co. AXA Investment Managere EARNEST Per mere,LLC Baillie Gifford Overseas Limited Eaton Vance Management Baird Advisors Epoch Investment Partners,Inc. Bank of America Fayez Sarofim&Company Baron Capital Management,Inc. Federated Inveslo5 Barrow,Hanley,Mewhinney&Strauss,LLC Fidelity Institutional Asset Management BlackRock Fidelity Management&Research BMO Global Asset Management Fees Capital Corporation BNP Paribas Asset Management First Eagle Investment Management,LLC BNV Mellon Asset Management First Hawaiian Bank Wealth Management Division Boston Partners Fisher Investments Broader,Investment Partners,L.P. Franklin Templeton Brandywine Global Investment Management,LLC Franklin Templeton Institutional Brown Brothers Hamman&Company Fred Alger Management,Inc. Gambier Investors,LLC GAM(USA)Inc. Capital Group Geode Capital Management,LLC Canlon Tower Advisers Gibia lax Capital,L.P. CastleArk Management,LLC GMO Causeway Capital Management Goldman Sachs Asset Management Callan I Knowledge.Experience.Integrity. Page 1 of 2 Green Square Capital LLC Pacific Investment Management Company Guggenheim Investments Pathway Capital Management Grind Municipal Bond Management Peregrine Capital Management,Inc. GW&K Investment Management Perkins Investment Management Harbor Capital Group Trust PGIM Hartford Funds PGIM Fixed Income Hartford Investment Management Co. Pier Capital,LLC Hellman LLC PineBridge Investments Henderson Global Investors Pioneer Investments Hotchkis&Wiley Capital Management,LLC PNC Capital Advisors,LLC HSBC Global Asset Management Prodigal Global Investors Income Research t Management,Inc. Private Advisors,LLC Indexl0/Mainstay Putnam Investments,LLC Insight Investment Management Limited OMA Intech Investment Management,LLC BBC Global Asset Management Invesco Regions Financial Corporation Invested Asset Management Rebece Institutional Asset Management,US Inc. Ivy Investments Rockefeller&Co.,Inc. Janus Henderson Investors Rothschild Mast Management,Inc. Jennison Associates LLC Russell Investments Jensen Investment Management S&P Global,Inc. Jobs Peak Advisors Sands Capital Management J P.Morgan Asset Management Santander Global Fadlltles J.P.Morgan Chase&Company Schroder Investment Management North America Inc. Kei Shelton Capital Management Lazard Asset Management Smith Graham&Co.Investment Advisors,L.P. Legal&General Investment Management America Smith Group Asset Management Lincoln Advisors South Texas Money Management,Ltd, Lincoln National Corporation Standard Life Investments Limited LMCG Investments,LLC State Street Global Advisors Longview Partners Stone Harbor Invedg ent Partners,L.P. Loomis,Sayler&Company,L.P. Sun Life Investment Management Lord Abbott&Company T.Rowe Price Associates,Inc. Los Angeles Capital Management The Boston Company Asset Management,LLC LSV Asset Management The Hartford MacKay Shields LLC The London Company Macquarie Investment Management The TCW Group,Inc. Manulife Asset Management Thompson,Siegel&Walmsley LLC Marathon Asset Management Thornburg Investment Management,Inc. McKinley Capital Management,LLC Tr-Star Trust Bank MFS Investment Management UBS Asset Management MidFirst Bank Van Eck Global Variation Investment Partners Limited Velanne Asset Management Ltd. Montag&Caldwell,LLC Versus Capital Group Morgan Stanley Investment Management Victory Capital Management Inc. Mountain Lake Investment Management LLC Vidos Investment Partners,Inc. MUFG Union Bank,N.A. Verri l Asset Management,Inc. Natims Investment Managers Voya Financial Neuberger Berman Voya Investment Management Newton Investment Management WCM Investment Management Nikko Asset Management Co.,Ltd. WEDGE Capital Management NOMam Trust Asset Management Wellington Management Company,LLP Nuveen Investments,Inc. Wells Capital Management OR Global Asset Management Western Asset Management Company Old Mutual Asset Management Westfield Capital Management Company,LP O'Shaughnessy Asset Management,LLC William Blair&Company PIE Investments Callan I Knowledge.Experience.Integrity. Page 2 of 2 March 31,2018 Investment Report Orange County Sanitation District Period Ending March 31 , 2018 Diego,6225 Lusk Blvd San Table of Contents SECTION 1 Economic Update SECTION 2 Account Profile SECTION 3 Consolidated Information SECTION 4 Portfolio Holdings SECTION 5 Transactions Coil SECTION 1 Economic Update IC& I Economic Update ■ The Federal Open Market Committee (FOMC) raised the fed funds target rate to a range of 1.50%-1.75% at the March 21 meeting, as expected. The vote was unanimous. In the policy statement, the Fed said economic activity has been "rising at a moderate rate" which was somewhat less bullish than the "solid rate" of growth cited in the January statement. Household and business fixed investment moderated from the fourth quarter. Inflation for items other than food and energy continues to run below 2.0% but the Fed expects inflation to move up in the coming months. The FOMC left its median fed funds rate forecast unchanged for 2018 at 2.1% which implies two more rate hikes by year- end. Although the forecasted median fed funds rate for 2018 did not change, the dot plot did change with 13 out of 15 FOMC members forecasting two or more rate hikes this year, compared with 10 out of 16 members at the December 2017 meeting. The fed funds rate targets for 2019 and beyond were revised up slightly. By the end of 2020, the FOMC's median forecast now calls for a fed funds rate of 3.4%. Overall, the Fed revised their GDP forecasts up slightly, their unemployment forecasts down slightly, and left their inflation projections mostly unchanged. ■ We are forecasting GDP growth of about 2.5%-3.0% in 2018, which is in line with the Fed's forecast and the market consensus. This would equate to an increase over 2017 GDP growth of 2.3%. Overall, economic data remains solid, with the exception of still-sluggish inflation readings. The economy is at or near full employment, consumer confidence is strong, and leading indicators suggest the economy will continue to grow. ■ The Treasury yield curve flattened in March. The 2-year Treasury yield increased slightly to 2.27% from 2.25%, while the 10-year Treasury yield decreased about 12 basis points to 2.86%. At month end, the spread between 2- and 10- year Treasury yields was just 47 basis points; quite flat by historical standards. Al else being equal, we believe the Fed's plan to normalize the balance sheet will help promote a steeper yield curve later this year. Tax reform and stronger economic growth may also help drive yields at the long end of the curve higher. However, we believe this is somewhat offset by anticipated ongoing monetary policy normalization by the Fed. s C1111 Employment Nonfarm Payroll (000's) Unemployment Rate 350 12.0% 11.0% —Untleremployment Rate(U6) 300 10.0% —Unemployment Rate(U3) N $ 250 8.0% 0 u 200 a 8.0% 7.0% t 150 6.0% U 100 5.0% 4.0% 50 3.0 0 2.0% Ma 41a, �01X `1, 1 4"a a'y, 1o. S".a % , q✓a, seq eft; 4ia� li'' '�sq 1 vs �s �s �s v� ' v� v� 4 v> >g �s 11� �s �s �s >> >> » 04 » 41 o,e Source:US Department of Labor Smooe:US Department of Labor U.S. payrolls rose by 103,000 in March, well below the consensus forecast of 175,000. January and February payrolls were also revised down by a net total of 50,000. On a trailing 3-month and 6-month basis, payrolls increased by an average of 202,000 and 211,000 per month, respectively. The unemployment rate was unchanged at 4.1%. The labor participation rate edged down to 62.9% from 63.0%. A broader measure of unemployment called the U-6, which includes those who are marginally attached to the labor force and employed part time for economic reasons, declined to 8.0%from 8.2%. Wages rose 0.3% in March, in line with expectations. Wages were up 2.7% on a year-over-year basis in March, versus up 2.6% year-over-year in February. The average workweek was unchanged at 34.5 hours. Inflation Consumer Price Index (CPI) Personal Consumption Expenditures 3.5% (PCE) —CPI VOV%Change 3.5% % —PCE Price Deflator VOV%CM1ange 3. —core cal vor%cnanga r 3.0% —PCE Care Deflator VOV%CM1ange ar 2.5% a 2.5% m m c c L 2.0% u V 2.0% 1.5% Y 1.5% O p 1.0% Y 1.0% 0.5% 0.51 0.0% 0.0% Oe, �0s, saq oac; ,; �. 41a1, �a +Ok � Hai, �O� �. 's 's 761 's 71 71 7� 7� 19 's 's '6 's '� 1i '1 » 'd Source:US Department of Labor Source:US Department of Labor The Consumer Price Index(CPI) was up 2.4% year-over-year in March, up from 2.2% in February. Core CPI (CPI less food and energy) was up 2.1% year-over-year in March, up from 1.8% in February. The Personal Consumption Expenditures (PCE) index was up 1.8% year-over-year in February versus 1.7% in January. Core PCE (excluding food and energy) was up 1.6% on a year-over-year basis in February versus 1.5% in January. Although PCE inflation remains below the Fed's 2.0% target, it inched higher in February. Consumer Retail Sales YOY % Change Consumer Confidence 7.0% 135 6.0% 130 25 u 5.0% 120 a 4.0% 115 110 Y3.0% y 105 O c � 2.0% 100 95 1.0% 90 0.0% 85 41 ': me Oa 4�a. tea, o°c 4ia 4, 4, `4�i" `%A '1'ok `Ha. 4i0, Ziah `4Ci1 sq +01 `5a, '1a1,d.10 O.70 A70 G70 lj lj 7> 7> /9 7& 76, C 76' 76. 1) J) )) J 7> 7> 7& JB Sooroe:US Depadmnt of Gomm Sov.:The Conference Boar On a year-over-year basis, retail sales were up 4.5% in March, versus up 4.1% year-over-year in February. On a month-over-month basis, retail sales increased 0.6% in March (above the consensus forecast of +0.4%). Excluding autos and gas, retail sales were up 0.3% in March, below expectations of 0.5%, following a 0.3% increase in February. The Consumer Confidence Index remained robust but eased slightly to 127.7 in March from 130.0 in February. Despite ongoing strength in the labor market and a very high level of consumer confidence, consumer spending remains modest. s URA Economic Activity Leading Economic Indicators (LEI) Chicago Fed National Activity Index oso (C F N AI) 1s% 1.4% 1.2% 0.40 v 1.0% m t 0.8% t8 0.20 0.6% t o.00 0.a% Ao f 02% -azo 0.0% -o.ao aa% 4 -aso T�'S �ah79 76 �ok76' 95'7I 71 Val' �ok71 .C133.7 e A�76 40k76 TB ryOL76 T�71, 410 h71 7 Som The Con/eience Soar Soo Federal Reserve Bank of Chicago The Index of Leading Economic Indicators (LEI) rose 0.6% in February, following a 0.8% increase in January. According to the Conference Board, the index points to robust growth ahead despite the downturn in stock markets and weakness in housing construction in February. The Chicago Fed National Activity Index (CFNAI) increased sharply to 0.37 in February from 0.16 in January, on a 3-month moving average basis. The CFNAI suggests that the economy is gaining strength. Housing Housing Starts S&P/CaseShiller 20 City Composite Home Price Index 1600 7.0% — b 1600 ■Multi Family Housing Starts j ■Single Family Hong Sbr6 6.5% c 1400 1200 u 6.0 m 0 1000 i H 5.5% $ 0 3E 600 p 5.0 m Y u 400 4.5% 200 S p 4.0 ' May' '16 tio1' ' May 9$, tio1' �' �o. s ;�s ,�s Ccr.�s �o.�� 10, "�i,�� cb, .�s s s s s > > > > e Source:US Census Bureau Source:S&P Total housing starts were weaker than expected in February, down 7.0%. Single-family starts rose 2.9% in January, while multi-family starts fell 26.1%. According to the Case-Shiller 20-City home price index, home prices were up 6.4% year-over-year in January, versus up 6.3%year-over-year in December. Pricing remains firm, owing in part to lack of supply. s CA11 Manufacturing Institute of Supply Management Industrial Production Purchasing Manager Index 5.0% 62 Expanding 4.0% 60 58 3.0% ON m 2.0% 56 ej u 1.0% 54 0.0% 52 en y -1.0% 50 -20% 46 &0% Contracting 46 -4.0% q'a,, `�% soµ 106, 1%1, 111*,71 soµ 1001 4101' �66,70 '%,, 10s +61, 11101' 94µ 70 70 Source:In ukute for Supply Management Souce:Fedeml Reserve The Institute for Supply Management (ISM) manufacturing index remained strong at 59.3 in March versus 60.8 in February. February's level was the strongest reading in 14 years. A reading above 50.0 suggests the manufacturing sector is expanding. The Industrial Production index was up 4.4% year-over-year in February versus up 3.5% in January. On a month-over-month basis, the index increased 1.1% in February, exceeding expectations. Overall, the index suggests activity in the factory sector is accelerating. Capacity Utilization increased to 78.1% in February from 77.4% in January, but remained below the long-run average of 79.8%, indicating there is still excess capacity for growth. s Gross Domestic Product (GDP) Gross Domestic Product(GDP) 6.0% Personal Consumption Expenditures 1.3% 2.2% 1.5% 2.8% 5.0% Gross Private Domestic Investment -0.2% 0.6% 1.2% 0.8% 4.0% 3.0% Net Exports and Imports 0.2% 0.2% 0.4% -1.2% 2.0% 1.0% Federal Government Expenditures -0.2% 0.1% 0.1% 0.2% 0.0% IF State and Local (Consumption and Gross -t 0% GDP DOD%Chen,. Investment) 0.1% -0.2% 0.0% 0.3% GDP YOY%Change -20% Total 1.2% 3.1% 3.2% 2.9% OeGJ��.I OeG���l oo4'`��. 6P- �64, �, �e4, � �eG 1 ? 2 J ,3 A kr S Source: US Department of Gommeme Source: US Department o/Commerce Fourth quarter GDP growth was revised up more than expected to 2.9%from the second estimate of 2.5%, driven largely by an upward revision to consumer spending. Consumer spending was very strong in the fourth quarter but net exports and inventories were both a large drag on growth during the fourth quarter. URA Bond Yields US Treasury Note Yields US Treasury Yield Curve 4.0% 4.0% 2-Year �Mer-iB 3.5% s-veer 3.5% Dec-1� 3.0% 16Year 3.0% �Mer-n 2.5% 2.5% a e —° 2.0% 5 2.0% • a -> s 1s% ts% 1.0% 1.0% 0.5% 0.5% 0.0% '4 sa `4i Ss' 00 a,;�s �''s ��a ai"7e °� v� vi » �s Source:Bloomberg Soume:Bloomberg Financial markets experienced increased volatility in recent months. Uncertainty about global trade, inflation, and the pace of monetary policy normalization have all contributed to the volatility. After steepening slightly earlier this year, the yield curve flattened in March and is quite flat by historical standards with the spread between 2-year and 10-year Treasuries just 47 basis points at the end of March. Coil SECTION 2 Account Profile U111 Objectives Investment Objectives The investment objectives of the Orange County Sanitation District are first, to provide safety of principal to ensure the preservation of capital in the overall portfolio; second, to provide sufficient liquidity to meet all operating requirements; and third, to earn a commensurate rate of return consistent with the constraints imposed by the safety and liquidity objectives. Chandler Asset Management Performance Objective Liquid Operating Monies —will be compared to the 3-month T-Bill rate and operate with a maximum maturity of one year. Long-Term Operating Monies — will be compared to the ICE BAML 1-5 Year Corporate Government Rated AAA—A Index. Strategy In order to achieve these objectives, the portfolio invests in high quality fixed income securities consistent with the investment policy and California Government Code. RI Compliance CA` Orange County Sanitation District Long Term March 31,2018 COMPLIANCE • Assets managed by ChandlerAsset Management are in full compliance Kith state lawand Kith the investmentpolicy JIM Standard Comment Treasury Issues 5 years maxmaturity; Minimum allocation of 10% Complies' U.S.Agencies 20%max issuer; 5 years max maturity Complies Supmnational "AA"rated or better by a NRSRO; 30%maximum; 5 years max maturity; USD Complies denominated senior unsecured unsubordinated obligations issued or unconditionally wranteed by BIRD, IFC or IADB Corporate(MTNs) "A"rated or better long tens debt by a NRSRO; 30%maximum;5%max issuer; 5years Complies max maturity, Issued by corporations organized and opemting within the U.S.or issued by depository institutions licensed by the U.S. Municipal Securities "A"rated or higher by a NRSRO; 10%maximum; 5%maxissuer, 5yearsmaxmaturity Complies Asset Backed/CMOs/Mortgage- "AA"rated or better by a NRSRO; "A"or higher issuer rating by a NRSRO; 20%maximum; Complies" backed 5%max issuer(excluding ovta enc /mbs ;5 years max maturity Negobable CDs "A"rated or better long tens debt by a NRSRO;or"A-1"/highest short tens rating by a Complies NRSRO; 30%maximum;5%max issuer,5 years max maturity Certificates of Deposit 5%max issuer; 5 years max matudy, Secured/collateralized Complies Bankers Acceptances A-1 rated or equivalent short tens rating by a NRSRO; 40%maximum; 5%max issuer, 180 Complies days max maturity Commercial Paper A-1 rated or equivalent short term rating by a NRSRO; "A"or better long tens debt issuer Complies bya NRSRO; Issued bya domestic corpomtion organized and operafing in the US with AUM>$500million; 25%maximum; 5%maxissuer; 270 days max maturity Mutual Fund&Money Market Highest rating or"AAA"rated by two NRSROs;SEC registered adviser with AUM>$500 Complies Mutual Fund million and experience greater than 5 years; 10%per one Mutual Fund; 20%maxper issuer on Money Market Mutual Funds; 20%max of the District's surplus money Repurchase A reements 102%collateralization Complies Reverse Repurchase Agreements 5%maximum,90 days max maturty Complies LAIF Not wed by investment adviser Complies OCIP Not used by investment adviser Complies Avg Duration Not to exceed 60 months - (80%to 120%of the benchmark) Complies Max Per Issuer 5%of ortfolio(except Su ranationals,U.S.Government,Agencies,Mutual Fund Com lies Maximum Maturity 5 years maximum maturity Complies* 'The portfolio has twenty-three(23)securities with maturities greater than 5 years including one(1)ABS,four(4)CMOs,seventeen(17)MBS and one(1)treasury. All securities were inherited from the predous manager and complied at time of purchase. GKI Portfolio Characteristics Orange County Sanitation District Long Term 3/31/2018 12/31/2017 Benchmark* Portfolio Portfolio Average Maturity (yrs) 2.69 2.72 2.52 Modified Duration 2.56 2.41 2.26 Average Purchase Yield n/a 1.96% 1.75% Average Market Yield 2.52% 2.42% 1.91% Average Quality" AAA AA+/Aa1 AA+/Aa1 Total Market Value 412,803,448 396,615,728 *ICE BAML 1-5 Yr US Corp/Gov:Rated AAA-A Index **Benchmark is a blended rating of S&P, Moody's, and Fitch. Portfolio is S&P and Moody's respectively. Many securities were purchased across the Treasury, Agency, Supranational, Asset Backed, Commercial Paper and Corporates sectors of the market to keep the portfolio structure consistent with Chandler targets. The purchased securities ranged in maturity from February 2018 to February 2023. Many securities matured and $17.5 million was contributed to the portfolio to facilitate the new holdings. Sector Distribution Orange County Sanitation District Long Term March 31, 2018 December 31, 2017 Foreign Corporate ABS ABS 5.7% 3.2% US Treasury 31.6% US 2.9%Treasury 29% Agency 22.7% Agency 29.5 CMO 0.5% CMO 0.6% Commercial Paper Commercial 5.1% Paper 1.7% Money Market Money Market US Corporate Fund FI US Corporate Fund FI 19.9% 2.7% 19.4°/ 4.0% Supranational Mortgage Pass Supranational 7.8% Municipal Thru 5.9% Municipal Mortgage Pass Negotiable CD Bonds 0.4% Negotiable CD Bonds Thru 1.4% 1.1% 1.5% 1.1% 0.4% The sector allocation changed moderately. Some of the notable changes include the 3.4% increase to the Commercial Paper allocation, the 2.5% increase to the Asset Backed allocation, and the 1.9% increase to the Supranational allocation, somewhat offset by the 6.8% decline to the Agency allocation. 0111 Issuers Orange County Sanitation District Long Term —Account #10268 As of 3/31/2018 Issue Name Investment Type % Portfolio Government of United States US Treasury 31.62% Federal National Mortgage Association Agency 9.16% Federal Home Loan Bank Agency 8.70% Federal Home Loan Mortgage Corp Agency 4.82% Inter-American Dev Bank Supranational 4.15% First American Govt Obligation Fund Class-Z Money Market Fund FI 2.66% Intl Bank Recon and Development Supranational 2.37% Bank of Tokyo-Mit UFJ Commercial Paper 1.99% Toyota Motor Corp Commercial Paper 1.93% Wells Fargo Corp US Corporate 1.91% John Deere ABS ABS 1.76% Bank of New York US Corporate 1.47% Honda ABS ABS 1.45% Bank of Nova Scotia Houston Negotiable CD 1.43% International Finance Corp Supranational 1.30% Toyota ABS ABS 1.28% JP Morgan Chase&Cc US Corporate 1.27% Nissan ABS ABS 1.21% Paccar Financial Commercial Paper 1.21% Deere &Company US Corporate 1.21% US Bancorp US Corporate 1.20% Qualcomm Inc US Corporate 1.20% General Electric Co US Corporate 1.20% IBM Corp US Corporate 1.12% HSBC USA Corp Foreign Corporate 1.07% Chubb Corporation US Corporate 1.01% Berkshire Hathaway US Corporate 0.98% Honda Motor Corporation US Corporate 0.97% Eli Lilly&Cc US Corporate 0.97% Apple Inc US Corporate 0.96% 0111 Issuers Orange County Sanitation District Long Term —Account #10268 As of 3/31/2018 Issue Name Investment Type % Portfolio Occidental Petroleum Corporation US Corporate 0.80% Morgan Stanley US Corporate 0.73% Exxon Mobil Corp US Corporate 0.72% Microsoft US Corporate 0.71% Port Authority of New York and New Jersey Municipal Bonds 0.63% HSBC USA Corp US Corporate 0.60% ChevronTexaco Corp US Corporate 0.60% Federal Home Loan Mortgage Corp CIAO 0.47% New York City Transitional Finance Authority Municipal Bonds 0.36% Federal National Mortgage Association Mortgage Pass Thru 0.33% PNC Financial Services Group US Corporate 0.24% University of California Municipal Bonds 0.11% Federal National Mortgage Association CIAO 0.06% GNMA Mortgage Pass Thru 0.05% AMRESCO Residental Securities Corp Mortgage Pass Thru 0.03% Small Business Administration ABS 0.01% SLIM Corp ABS 0.01% GNMA CMO 0.00% Federal Home Loan Mortgage Corp Mortgage Pass Thru 0.00% Total 100.00% Quality Distribution Orange County Sanitation District Long Term March 31, 2018 vs. December 31, 2017 70.00% 60.00% 50.00% 40.00% 30.00% 20.00% 10.00% 0.00% AAA AA A <A NR •3/31/2018 •12/31/2017 AAA AA A <A NR 03/31/18 14.5% 62.5% 13.3% 0.7% 8.9% 12/31/17 15.5% 63.8% 11.6% 1.7% 7.3% Source:S&P Ratings Duration Distribution Orange County Sanitation District Long Term Portfolio Compared to the Benchmark as of March 31, 2018 35.00% 30.00% 25.00% 20.00% 15.00% 10.00% 5.00% 0.00% 0-0.25 0.25-0.50 0.50- 1 1 -2 2-3 3-4 4-5 5+ •Orange County Sanitation District Long Term .ICE BAML 1-5 Yr US Corp/Gout Rated AAA-A Index 0-0.25 0.25- 0.50 0.50- 1 1 -2 2- 3 3 .4 4- 5 5+ Portfolio 11.6% 3.3% 11.3% 13.1% 24.0% 18.3% 15.8% 2.6% Benchmark' 0.0% 0.0% 1.5% 32.3% 29.2% 22.5% 14.4% 0.0% "ICE BAML 1-5 Yr US Corp/Gout Rated AAA- A Index The duration of the portfolio increased to 2.41 compared to 2.26 at the end of the prior quarter. The Chandler team continues to position the portfolio to have an interest rate sensitivity to be modestly below the benchmark in light of the rising rate environment. AW Investment Performance Orange County Sanitation District Long Term Period Ending March 31, 2018 Total Rate of Return Annualized Since Inception November 30, 2014 1.00% 0.90% 0.80% 0.70% 0.60% 0.50% 0.40% 0.30% 0.20% 0.10% 0.00 12 months 2 years 3 years 5 years 10 years Since Inception •Orange County Sanitation District Long Term Annualized 3 months 12 months 2 years 3 years 5 years 10 years Since IOCephOn Orange County Sanitation District Long Term -0.33% 0.31% 0.38% 0.77% N/A N/A 0.88% ICE BAML 1-5 Yr US Corp/Govt Rated AAA-A Index -0.45% 0.09% 0.15% 0.66% N/A N/A 0.78% Total rate of return: A measure of a portfolio's performance over time. It is the internal rate of return, which equates the beginning value of the portfolio with the ending value; it includes interest earnings, realized and unrealized gains and losses in the portfolio. RI Compliance CA Orange County Sanitation District Liquid March 31,2018 COMPLIANCE • Assets managed by Chandler Asset Management are in full compliance Wth state lawand ulth the investmentpolicy Category Standard lComplies Treasury Issues 1 year max maturity, Minimum allocation of 10% U.S.Agencies 20%max issuer; 1 year max maturity Supranational "AA"rated or better by a NRSRO; 30%maximum; l year max maturity; USD denominated senior unsecured unsubordinated obligations issued or unconditional guaranteed b IBRD, IFC,or LADS Corporate(MTNs) "A"rated or better long tens debt bya NRSRO; 30%maximum;5%max issuer; 1 year max maturity, Issued by corporations organized and operating within the U.S.or issued b depository institutions licensed b the U.S. Asset Backed/CMOs "AA"rated or better bya NRSRO; "A"or higher issuer rating by a NRSRO; 20% maximum; 5%max issuer; 1 year max matunty Negotiable CDs "A"rated or better long term debt bya NRSRO;or"A-1"/highest short term mting Complies by aNRSRO; 30%maximum;5%max issued year max maturity Certificates of Deposit 5%max issuer; 1 year max maturity, Secured/collateralized Complies Banker's Acceptances A-1 rated or equivalent short term rating by a NRSRO; 40°/maximum; 5%max Complies issuer 180 days max matunt Commercial Paper A-1 rated or equivalent short tens rating bya NRSRO; "A"or better long tern Complies debt issuer bya NRSRO; Issued by a domestic corporation organized and operating in the US with AUM>$500million; 25%maximum; 5%max issuer; 270 days max maturity Mutual Fund&Money Market Mutual Fund Highest rating or"AAA"rated by two NRSROs;SEC registered adviser with Complies AUM>$500 million and experience greater than 5 years; 10%per one Mutual Fund; 20%max per issuer on Money Market Mutual Funds; 20%max of the Districfs surplus money Repurchase Agreements 102%collateraliza0on Complies Reverse Repurchase Agreements 5%maximum,90 days max maturity Complies LAIF Not used by investment adviser Complies OCIP Not used by investment adviser Complies Prohibited Municipal Securities Complies Prohibited Mortgage Securities Complies Avg Duration Notto exceed 180 days; Max duration of 1/2 year Complies Max Per Issuer 5%of portfolio(except Supranationals,U.S.Government,Agencies,Mutual Fund) Complies Maximum Maturity 1 year maximum maturity Complies COIL Portfolio Characteristics Orange County Sanitation District Liquid 3/31/2018 12/31/2017 Benchmark* Portfolio Portfolio Average Maturity (yrs) 0.15 0.18 0.16 Modified Duration 0.14 0.18 0.15 Average Purchase Yield n/a 1.65% 1.33% Average Market Yield 1.60% 1.77% 1.37% Average Quality" AAA AAA/Aa1 AA+/Aaa Total Market Value 92,872,260 145,486,316 *ICE BAML 3-Month US Treasury Bill Index **Benchmark is a blended rating of S&P, Moody's, and Fitch. Portfolio is S&P and Moody's respectively. Many securities were purchased across the Treasury, Agency, Certificate of Deposit, Commercial Paper, and Corporate sectors of the market to keep the portfolio as fully invested as possible. Three securities were called and many matured, including some large positions on March 31, 2018 (a Saturday) which contributed to the large reported money market fund allocation at the end of the reporting period. Additionally, a net $53 million was withdrawn from the portfolio during the quarter. Sector Distribution Orange County Sanitation District Liquid March 31, 2018 December 31, 2017 Negotiable CD 1.1% Agency 14.3 US TreasuryAgency 40.8% Commercial 29.0% Paper US Treasury 8.2% 52.7% Commercial Paper Money Market 4.7% Fund FI Money Market 20.6% Fund FI 1.1% 4 Supranational US Corporate Supranational US Corporate 3.8% 12.3% 2.7% 8.9% The sector allocation changed materially as the investment opportunities in the short maturity sector of the market continue to evolve. As previously noted the large money market allocation was related to the $18 million in maturities on March 31, which were subsequently reinvested into the strategy in early April. 0111 Issuers Orange County Sanitation District Liquid —Account #10282 As of 3/31/2018 Issue Name Investment Type % Portfolio Government of United States US Treasury 40.85% First American Govt Obligation Fund Class-Z Money Market Fund FI 20.56% Federal Home Loan Bank Agency 13.42% International Finance Corp Supranational 2.69% State Street Bank US Corporate 2.27% Bank of Tokyo-Mit UFJ Commercial Paper 1.99% Toyota Motor Corp Commercial Paper 1.93% Deere &Company US Corporate 1.62% Paccar Financial Commercial Paper 1.61% Rabobank Nederland NV NY Commercial Paper 1.60% JP Morgan Chase&Co US Corporate 1.35% Berkshire Hathaway US Corporate 1.10% Bank of America Corp US Corporate 1.08% Cisco Systems US Corporate 1.08% Merck&Company US Corporate 1.08% Pfizer Inc. US Corporate 1.08% Royal Bank of Canada Negotiable CD 1.08% Bank of New York Commercial Paper 1.07% Charles Schwab Corp/The US Corporate 1.01% Federal Home Loan Mortgage Corp Agency 0.86% HSBC USA Corp US Corporate 0.67% Total 100.00% Quality Distribution Orange County Sanitation District Liquid March 31, 2018 vs. December 31, 2017 70.00% 60.00% 50.00% 40.00% 30.00% 20.00% 10.00% 0.00% AAA AA A <A NR •3/31/2018 •12/31/2017 AAA AA A <A NR 03/31/18 56.9% 35.2% 8.0% 0.0% 0.0% 12/31/17 32.4% 61.5% 6.1% 0.0% 0.0% Source:S&P Ratings Duration Distribution Orange County Sanitation District Liquid Portfolio Compared to the Benchmark as of March 31, 2018 120.00% 100.00% 80.00% 80.00% 40.00% 20.00% 0.00% 0-0.25 0.25-0.50 0.50-1 1 -1.5 1.5-2 2-2.5 2.5-3 3+ •Orange County Sanitation District Liquid •ICE BAIL 3-Month US Treasury Bill Index 0-0.25 0.25- 0.50 0.50 . 1 1 - 1.5 1.5-2 2 -2.5 2.5- 3 3+ Portfolio 77.9% 21.1% 1.1% 0.0% 0.0% 0.0% 0.0% 0.0% Benchmark' 100.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% "ICE BAML 3-Month US Treasury Bill Index The duration of the portfolio increased marginally, currently 0.18 versus 0.15 at the end of the prior quarter. The Chandler team will look to moderately extend the duration of the portfolio in the coming weeks to correspond with the upcoming liquidity needs of the District. GI Investment Performance Orange County Sanitation District Liquid Period Ending March 31, 2018 Total Rate of Return Annualized Since Inception November 30, 2014 1.20% 1.00% 0.80% 0.60% 0.40% 0.20% 0.00% 12 months 2 years 3 years 5 years 10 years Since Inception •Orange County Sanitation District Liquid .ICE BAML 3-Month US Treasury Bill Index Annualized 3 months 12 months 2 years 3 years 5 years 10 years Since IOCephOn Orange County Sanitation District Liquid 0.35% 1.11% 0.78% 0.63% N/A N/A 0.59% ICE BAML 3-Month US Treasury Bill Index 0.35% 1.11% 0.73% 0.53% N/A N/A 0.48% Total rate of return: A measure of a portfolio's performance over time. It is the internal rate of return, which equates the beginning value of the portfolio with the ending value; it includes interest earnings, realized and unrealized gains and losses in the portfolio. U111 Compliance CA OCSD Lehman Exposure March 31, 2018 COMPLIANCEPOLICY Assets managed by ChandlerAsset Management are in full compliance wth state lawand wth the investment policy Category Standard Comment Treasury Issues 5 years maximum maturity Complies Supranational "AA" or better by 1 of 3 NRSROs; 30% maximum; 5% max; 5 years maturity; Complies Includes only: IADB, BIRD, and IFC per CGC U.S.Agencies 20% max issuer 5 years maximum maturity Complies U.S. Corporate (MTNs) "A" or better long term rating by 1 of 3 NRSROs; 30% maximum; 5% max issuer; 5 Complies` years max maturity Municipal Securities "A" or higher by 1 of 3 NRSROS; 10% maximum; 5% max issuer, 5 years Complies maximum maturity Asset Backed/CMOs/ "AA" or better by 1 of 3 NRSROs; "A" or higher issuer rating by 1 of 3 NRSROs; Complies Mortgage-backed 20% maximum; 5% max issuer(excluding MBS/gout agency); 5 years max maturity Negotiable CDs "A" or better on its long term debt by 1 of 3 NRSROs ; "A1/P1" or highest short term Complies ratings by 1 of 3 NRSROs; 30% maximum; 5% max issuer; 5 years max maturity CDs/TDS 5% max issuer; 5 yearsmax maturity Complies Bankers Acceptances A-1, or equivalent highest short term rating by 1 of 3 NRSROS; 40% maximum; 5% Complies max issuer; 180 days max maturity Commercial Paper A-1, or equivalent by 1 of 3 NRSROS; "A" or better by 1 of 3 NRSROs, if long term Complies debt issued; 25% maximum; 5% max issuer; 270 days max maturity Money Market Fund Highest rating by 2 of 3 NRSROs; 20% maximum; 10% max issuer Complies Repurchase A reements 102% collateralization Complies Reverse Repurchase 5% maximum, 90 days max maturity Complies Agreements LAIF Not used by nvestment adviser Complies Ava Duration Not to exceed 60 months - 80%to 120° of the benchmark Com lies Max mum Maturity 5 years max mum matur tv ComnlAes Account holds $2 million face value(cusip 525ESCOY6)and $600,000 face value(cusip 525ESC1B7)of defaulted Lehman Bros Holdings that were purchased by the preNous manager. Complied at time of purchase. GRI Portfolio Characteristics OCSD Lehman Exposure 3/31/2018 12131/2017 Portfolio Portfolio Average Maturity (yrs) 19.60 20.37 Modified Duration 0.00 0.00 Average Purchase Yield 0.00% 0.00% Average Market Yield 0.00% 0.00% Average Quality NR/NR NR/NR Total Market Value 129,921 145,221 Coil SECTION 3 Consolidated Information CIR� Portfolio Characteristics Orange County Sanitation District Consolidated 3/31/2018 12/31/2017 Portfolio Portfolio Average Maturity (yrs) 2.26 1.89 Modified Duration 2.00 1.70 Average Purchase Yield 1.90% 1.63% Average Market Yield 2.30% 1.76% Average Quality AA+/Aa1 AA+/Aa1 Total Market Value 505,805,628 542,247,265 Sector Distribution Orange County Sanitation District Consolidated March 31, 2018 December 31, 2017 Foreign Corporate ABS ABS 0.9% 4.7% 2.3% US Treasury 33.3% US Treasury Agency 38.2% 21.1% Agency 29.3% CMO 0.4% CMO Commercial 0.4 Paper Commercial 5.7% Paper 2.5% Money Market Money Market US Corporate Fund FI Fund FI 18.5% 5.9% US Corporate 3.2% Supranational Mortgage Pass 16.6% Supranational Mortgage Pass 6.9% Municipal Thru 5.3% Municipal Thm Negotiable CD Bonds 0.3% Negotiable CD Bonds 0.3% 1.4% 0.9% 1.1% 0.8% Coil SECTION 4 Portfolio Holdings Cj'k� Holdings Report Orange County Sanitation District Long Term -Account #10268 For the Month Ending 3/31/2018 Purchase Date Cost Value Mkt Price Market Value %of Pon. MoodyfS&P Maturity CUSIP Security Description ParValue/Units Book Yield Book Value MktYTM Accrued Int. Gairl Fitch Duration MENEM s _ 89236WAC2 Toyota Auto Receivables Owner 2015-A 126.12749 02/24/2015 126,108.42 99,98 126,100,50 0.03% Asa/AAA 0.8a 1.120% Due 02/15/2019 1,13% 126,127.49 528% 62.78 (26.991 NR 0.03 65478WA131 Nissan Auto Receivables Owner 2016-0 A2A 298,556.11 08/02/2016 298,544.35 99.97 29845191 007% Aaa/NR 1.12 1070% Due05/15/2019 1.08% 298,551.34 L56% 141.98 (99.43) AAA 0.07 43814TAB8 Honda Auto Receivables 2017-1 A2 820,76066 03/21/2017 820,74104 99.74 818,653.77 0.20% AaaI NR 1.31 1.420% Due 07/2/2019 143% 820,749.60 2.43% 323.74 (2,095.83) AAA 0.25 4T187XAB3 John Deere Owner Trust 2017-A A2 934,696.19 0212212017 934 692.45 99.73 932,136.99 0.23% Ann/NR 1.54 1.500% Due 10/15QO19 1.50% 934,693.99 2A8% 623.13 (2,557.00) AAA 0.28 654747AB0 Nissan Auto Receivables 2017-A A2A 940,656.59 03/21/2017 940,65179 99.58 9W,681.38 0.23% Aaa/NR 1.79 1.470% Due01/i5Y2020 1.47% 940,653.52 2.61% 614.56 (3,972.14) AM 0.37 43814PAB6 Honda Auto Receivables Owner T 17-3 A2 W5,000.00 W25/2017 %4,914.21 99.51 960,226.15 0.23% NR/AAA 1.81 1.570% Due 01Y2 M20 1.58% W4,932.91 2.47% WAD (4,706.76) AAA 0.55 4n88MAC4 John Deere Owner Trust 2016-A A3 1,654,824.69 02/23/2016 1,654,564.23 99.43 1,645,350.82 0.40% Aai 2.W 1.360% Due04/15/2020 1,37% 1,654,69576 2.61% 1,000.25 (9,344.94) AAA 0.46 438140AC2 Honda Auto Receivables 2016-2 A3 1,381,783.21 05/24/2016 1,381,756,41 99.41 1,373,694.25 0.33% Aai IN 1390% Due04/15/2020 140% 1.381769.10 2.51% 853.63 (18,074.85) AAA 0.52 4n88BAB0 John Deere Owner Trust 2017-B A2A 878,180.82 07/11/2017 878,10,151 99.54 874,104.30 0.21% Aai 2.W 1590% Due 04/15/2020 1.60% 878,124.08 2.56% 620.58 (4,019,78) AAA 0.48 89238BAB8 Toyota Auto Receivables Owner 2018-A A2A 5,170,000.00 01/2W2018 5,169,471.63 99.59 5,148,890.89 1.25% Aaa/AAA 2.55 2.100% Due 10115Q020 2.12% 5,169,503.72 2.55% 4,825.33 (20.612.83) NR 0.94 47188CAB8 John Deere Owener Trust 201&A A2 1,80 ,000.00 03/16/2018 1,796,34335 99.81 1,796,502.60 0.44% Aaa/NR 2.55 2.420% Due 10/15=0 2.59% 1,796,390.43 2.62% 3,751.00 112.17 AAA 1.03 438141RAC0 Honda Auto Receivables 20164 A3 2,875,000.00 02I07I2018 2,843,442.38 98.69 2,837,328.88 0.69% NRIMA 2.72 1.210% Due 12/18/2020 2.5B% 2,844,985.47 2.60% 1,256.22 (7,656.59) AAA 0.95 65478VAD9 NAROT 2016-B A3 2,000,000.00 0211212018 1,983,984.38 99.00 1,980,014.00 0.48% Aai 2.80 1320% Due01/15/2021 1.87% 1,984,675.49 2.61% 293.33 (4,661.491 AM 0.77 83162CUO Small Business Administration 2001-20C 39.115.36 0310612001 39,115.36 103.59 40,519.37 0.01% Aaa/AA+ 2.92 6.340% Due 03/01/2021 6.34% 39,115+36 5.68% 206.66 1,404.01 AAA 1.50 654W7UAD2 NAROT 2015-A4 1,800,000.00 OV0912018 1,788,750.00 99.26 1,786,755.60 0.43% Aaa/NR 3.46 1.5004 Due09/i5Y2021 1.86% 1,789,153.63 2AM 1,200.00 (2,398.03) AAA 0.77 47788BAD6 John Deere Owner Trust 2017-B A3 675,000.00 07/11/2017 674,950.59 98.49 664,178.48 0.16% Aai 3.55 1.820% Due 10/15=1 1.83% 674,95878 2.75% 546.00 (10,180.30) AM 1.64 4A88CAC6 John Deere Owerner Trust 2016-6 A4 1,W,W0.00 02/21/2018 1,339,903+65 99.84 1,337,874.76 0.32% Aaa/NR 4.05 2.660% Due04/182022 2.69% 1,339,905.69 2.75% 3,W9.34 (2,030.93) AAA 2.09 78445JAA5 SLMA 2008-9 A 29,180.71 0812212008 29,062+32 102.06 29,781.10 0.01% Baa3/AAA 5.07 3.241% Due04/25/2023 3.32% 29.139.79 2.91% 173.40 641.31 B 3.37 23,885,101.47 23,587,845.75 5.72% AaeIAAA 2.52 Total ASS 23,728,881.83 1.97% 23,868,126.15 2.58% 20,109.03 (00,280.40) Aaa 0.83 Cj'k� Holdings Report Orange County Sanitation District Long Term -Account #10268 For the Month Ending 3/31/2018 Purchase Date Cost Value Mkt Price Market Value %of Pon. MoodyfS&P Maturity CUSIP Security Description ParValue/Units Book Yield Book Value MMYW Accrued Int. Gam/Loss Fitch Duration Agency 313385VE3 FHLB Discount Note 4,3W,00000 03/21/2018 4.346,713.33 99,98 4,348,972.92 1.05% P-1IA-1+ 0.02 1.700% Due 0410612018 1,72% 4,348,972.92 172% 0.00 0.00 F-1+ 0,02 313385VZ6 FHLB Discount Note 10,W0,000.00 03/28/2018 9.986,814.44 99.89 9988,]6666 2.42% P-1IA-1+ 0.07 1.685% Due04125/2018 171% 9,988,766.66 1J1% 0.00 0.00 F-1+ 0.07 3135GOG72 FNMA Note 5,01)(0,000.00 12/18/2015 4,963,950.00 99.34 4,987,190.00 1.21% Aaa/AA+ 0.91 1.125% Doe12lUnO18 1.37% 4.991492.33 2.07% 16,71875 (24.302.33) AAA 0.69 31337821,12 FHLB Note 7,51)(3,000.00 Various 7,589,190.00 99.41 7,455,472.50 1.81% Aaa/AA+ 0.94 1.500% Doa0310812019 1.14% ],524,3]5A6 2A4% 7,18T50 (68,902.96) AAA 0.92 313]FADMS FHLMC Note 7,50(),000.00 Various 7,399,650.00 98.50 7,387,545.00 1.80% Aaa/AA+ 1.51 1.250% Dne1010212019 1.61% 7,460,397.85 2.27% 48,614.58 (72,852.85) PM 1.47 313383HUB FHLB Note 5,0W,W0.00 M113/2015 5,008,950.00 98.% 4,928,125.00 1.20% Aaa/AA+ 2.20 1.750% Due06/12/2020 1.71% 5,004,074.18 2.43% 26.493.06 (75,949.18) NR 2.13 3135GOD75 FNMA Note 5,OW,000.00 1111612015 4,955,650+00 98.06 4,90,125.00 1.19% Aaa/AA+ 2.23 1.500% Due06/222020 1.70% 4,978,524A9 2.40% 20,625.00 (75,399.99) AAA 2.16 3137EAEKI FHLMC Note 5,000,000.00 Various 4,986,225,00 98.53 4,926,410.00 1.20% Aaa/AA+ 2.64 1.875% Duell/17/2020 1.97% 4,987,698.15 2.46% 36.416.67 (61.288.15) AAA 2.53 3135GOF73 FNMA Note 7,500,000.00 Various 7,370,726.00 97.63 7,321,875.00 1.78% Aaa/AA+ 2.67 1.500% Due 11/30/2020 1,87% 7.430,456+98 2.42% 37,812.50 (108.581,98) AAA 2.58 313]FAEL9 FHLMC Note 7,500,000.00 0212612018 7,484,475.00 99.72 ],4]8,T/5.00 1.82% Aaa/AA+ 2.88 2.375% Due O2116Y 021 2.45% 7,484,947.19 2.48% 22,265.63 (6.172.19) PM 2.75 3130A7CV5 FHLB Note 5,365,000.00 02/17/2016 5,343,325.40 97.09 5,2W,O82.37 1.26% Aaa/AA+ 2.89 1.375% Due02118/2021 1.46% 5,352,495.88 2.43% 8,811.27 (143,413.51) AAA 2.80 3135GOJ20 FNMA Note 10,W0,000.00 Various 10,040,950+00 96.97 9,6%,880.00 2.35% Aaa/AA+ 2.91 1.375% Due0MM021 1.2B% 10,025,951A2 2.46% 13,368.06 (329,071.12) AAA 2.82 313379RB7 FHLB Note 4,000,000.00 0813012017 4,030,160.00 98.03 3,921.252.00 0.96% Ass/AA. 3.20 1.875% Due06/11/2021 1.67% 4,025,504.87 2.52% 22.916.67 (104.252.87) AAA 3.06 3135GOS38 FNMA Note 3,000,000.00 0113012017 2,994,570.00 97.97 2,939,084.00 0.72% Aaa/AA+ 3.77 2.000% Due 01/05/2022 2.W% 2,995,852+08 2.57% 14,333.33 (58788.08) AAA 3.58 3135GOT45 FNMA Note 5,OW,000.00 0510512017 4,972,500.00 97.38 4,868,750.00 1.19% Aaa/AA+ 4.02 1.875% Due04/05c!022 1.99% 4,977,530A7 2.57% 45,833.33 (108780.67) AAA 3.80 3135GOT94 FNMA Note 3,OW,00000 03/28/2018 2,956,410.00 98.75 2,%2,WO.00 072% Aaa/AA+ 4.81 2.375% DUe01119=3 2.70% 2,956,484.43 2.65% 13,458.33 6,015.57 PHA 4.48 94,430,339.17 93,303,785.45 22.68% Aaa IAA+ 2.13 Total Agency 94,715,000.00 172% 94,W3,525.76 2.29% 331,854.68 (1,229,740.31) Are 2.05 31398VJN FHLMC FHMS K006 A2 900,00000 1112312010 951,046.88 102.43 921,912.30 0.22% Act 1AA+ 1.82 4.251% Due01/2512020 3.54% 910,136A0 260% 3,188.25 11,776.20 AAA 1.59 3837114NX9 GNMA Pool#2000-9 17,157.35 01/24/2000 17,157.35 100.45 17,235.07 0.00% Aaa/AA+ 11.89 2.322% Due021162030 2.34% 17,157.36 1.92% 31.57 77.72 AAA 0.03 A= Cj'k� Holdings Report Orange County Sanitation District Long Term -Account #10268 For the Month Ending 3/31/2018 Purchase Date Cast Value Mkt Pric. Market Value %of Pon. MoodyIS&P Maturity CUSIP Security D..cvipti.n Par Value/Units Book Yield Book Value Mkt YTM Accru,d i GainlLoss Fitch Duration 3133TCE95 FHLMC FSPC E3A 21,462.60 03/11/1998 21,485.06 100.00 21,462.60 0.01% Aaa I AA- 14.39 3.445% Due00/15Y2032 3,41% 21,472+01 3.36% 61.62 (9,41) AAA 6.62 31397GREO FNMA FNR 2011-3 FA 247,845.15 12/20/2010 247,767.70 101.93 252.621.13 0.06% Aaa/AA+ 22.92 2.555% Due 02Y5Y2041 2.56% 247,7 1] 2.13% 105.54 4,834.96 AAA 0.13 31394JY35 FHLMC FSPC T-582A 860,W7.71 06/09/2011 974,524.97 112.99 972,304.87 0.24% Aaa/AA+ 25.50 6.500% Due 09Y25Y2043 5.40% 950,514.72 3.27% 932.22 21,790.15 AAA 4.01 2,211,981.96 2,185,535.97 0.0% Asa/AA+ 14.99 Total CMO 2,046,972.81 4.24% 2.147,066.35 2.84% 4,319.20 38,469.62 Aaa 2.53 mereial Pa _ i 89233HE75 Toyota Motor Credit Discount CP 8,000,000.00 03I22I.92% 7,984,880.00 992% ],98g880.00 1 0.0 P-1 /A-1+ 0.10 1.890% Due 05/0]/2018 1.92% ],984,880.00 1.92% 0.00 0.00 NR 0.10 6931 Paccar Financial Discount CP 5,000,00000 02/26/2018 4,9]],645,83 99.73 4,986,381.94 1.21% P-1/A-1 0,15 1.860% Due0524/2018 1.89% 4,986,381.94 1.88% 0.00 0.00 NR 0.15 06538CFDB Bank of Tokyo Mitsubishi NY Discount CP 8,240,000.00 03/13/2018 8,195,778+67 99.57 8,204,911.34 1.99% P-1/A-1 0.20 2.100% Due06/13/2018 2.14% 8.201 2.14% 0.00 0.00 NR 0.20 21,154,104.50 21,176,173.28 5.13% P-1 IA-1 0.15 Total Commercial Paper 21,240,000.00 2.00% 21,176.173.20 2.00% 0.00 0.00 NR 0.15 Foreign Corporate 40428OBF5 HSBC Holdings PLC Note 4,500,000.00 Various 4,429,980+00 97.23 4,375,296.00 10% A2/A 377 2.650% Due 01/05/2022 3.08% 4.431,]46.35 3.44% 28.487.50 (56.450.35) AA- 3.52 4,429,980.00 4,375,298.00 1.07% MIA 3.77 Total Foreign Corporate 4,500,000.00 3.08% 4,431,746.35 3.44% 28,487.50 (56,450.35) AA- 3.52 Money Market Fund FI ill 31846V567 First Amencan Govt Obligation Ml Class-Z 10,964]31.]2 Various 10,964 731 72 1.00 10,964731 72 2.66% Aaa I AAA 0.00 149% 10,964.73172 1.49% 0,00 0.00 AAA 0,00 10,964,731,72 10,964,731.72 2.66% Aaa I AAA 0.00 Total Money Market Fund FI 10,964,731,72 1A9% 10,964,731.72 1.49% 0.00 0.00 Aaa 0.00 dilleellel a Pass Thru 31381PDA3 FNMA FN 466397 349,929,50 12/01/2010 342,356.82 101,54 355,318,06 0.09% Aaa I AA+ 2.59 3400% Due 11/01/2020 3.80% 347,951.56 2,75% 231.34 7,366.50 AAA 2.43 36225CA29 GNMA Pool#G280023 20.803.15 08/08/1997 21,14711 102.96 21,419.94 0.01% Aaa/AA+ 8.73 3.230% Due 12I20/2026 3.12% 20,90563 2.96% 56.00 514.31 AAA 4.00 36225CC20 GNMA Pool#G280088 22,266.20 08/11/1997 22,753.29 103.58 23,062.68 0.01% Aaa/AA+ 9.23 2.720% Due 06/20/2027 2.58% 22,416+79 2.73% 50.47 645.89 AAA 2.79 31348SWM FHLMC PH 78601 2,159.28 02118/2000 2,106.71 102.23 2,207.45 0.00% Aaa/AA+ 9.76 3.447% Due 01/01Q028 3.65% 2,140.87 3.46% 6.20 66.58 AAA 4.54 313]1NUC] FNMA FN 257179 20,414.51 12/05/2011 21,5901 104.98 21.430.50 0.01% Asia/AA+ 10.01 4.500% Due U101Q028 3.72% 21,135.80 2.81% 76.55 294.70 AAA 3.26 Cj'k� Holdings Report Orange County Sanitation District Long Term -Account #10268 For the Month Ending 3/31/2018 Purchase Date Cast Value Mkt Mica Market Value %of Port, MoodyIS&P Maturity CUSIP S..unty D..cvipti.n Par Value/Units Book Yield Book Value Mkt YTM Accrued fint. Gainli-ose Fitch Duratiou 31417YAY3 FNMA Pool#FN MAD022 22,859.87 12/05/2011 24,17654 104.99 24,001.56 0.01% Aso I AA- 11.01 4.500% Due 04/01/2029 3,76% 23,696+96 2.90% 85.72 304.60 AAA 3.42 3138EG6F6 FNMA FN AL0869 13.828.06 12105I2011 14,624.54 105.00 14.519.16 0.00% Aaa/AA+ 11.18 4.500% Due 06/012029 3.77% 14,337.20 2.92% 12.10 181.96 AAA 3.47 03215PFN4 AMRESCO Residential Securities 1999-1 A 133,743.29 05/20/2011 100,432.85 99.87 133,570.76 0.03% NR I A+ 11.24 2.815% Due 06252029 6.54% 113,057.24 3.02% 73.21 20,513.52 BBB 6.59 36225CNW GNMA Pool#G280395 8,5(14.67 03/15/2000 8487.03 103.55 8,868.61 0.00% Aaa/AA+ 12.06 2.720% Due 04202030 2.79% 8,533.38 2.88% 19.41 335.23 AAA 4.32 36225CN28 GNMA Pool#G280408 67,248.77 03/15/2000 66,56518 103.57 69,848.14 0.02% Aaa/AA+ 12.15 2.720% Due 05/20/2030 2.80% 66,972,41 2.74% 152.43 2.675.73 AAA 3.74 31403GXF4 FNMA Pool#FN 748678 2,826.32 06/10/2013 3,038.29 107.15 3,028.35 0.00% Me/AA+ 15.52 5.000% Due 10/01/2033 4,16% 2,988+88 2.99% 11.78 39.47 AAA 4.02 36225DCBB GNMA Pool#G2 SN65 65,241.80 07/19/2004 65,700.72 103.83 68,258.59 0.02% Aaa/AA+ 16.32 2.810% Due OMM034 2.82% 65.719.41 2.69% 153.95 2,539.18 AAA 4.02 31406XWT5 FNMA Pool#FN 823358 130,299.20 01/11/2006 129,28L25 104.56 136,242.28 0.03% Aaa/AA+ 16.85 3.502% Due 021012035 3.57% 129,708.60 3.86% 380.29 6,533.68 AAA 7.40 31406POY8 FNMA Pool#FN 815971 217,603.38 06/10/2013 233,923+65 107.99 234,991.20 0.06% Aaa/AA+ 16.93 5.000% Due 03/012035 4.21% 230,367.86 3.16% 906.68 4,623.34 AAA 4.20 314078XH7 FNMA Pool#FN 826080 23,990.86 0611012013 25,790.16 108.03 25,916.17 0.01% Aso/AA+ 12.26 5.000% Due 071012035 4.22% 25,404.10 3.16% 99.96 512.07 AAA 4.22 31376M2 FNMA FN 357969 129.003.34 0611012013 138,678.57 107.98 139,302.19 0.03% Aaa/AA+ 17.43 5.000% Due 09101/2035 4.U% 136,618+56 3.17% 125.42 2,683.63 AAA 4.0 31403DJZ3 FNMA Pool#745580 124,703.39 OW1012013 134,056.16 107.96 134,630.40 0.03% Aaa/AA+ 18.18 5.000% Due 061012036 4.26% 132,130.10 3.18% 519.60 2,500.30 AAA 4.26 31410F4V4 FNMA Pool#FN BN336 241,739.66 06/10/2013 259,870A6 107.96 260,974.88 0.06% Ass/AA+ 18.27 5.000% Due 07/012036 4.25% 256,149A0 3.17% 1,007.25 4,825.08 AAA 4.24 1,614,580.56 1,677,390.92 0.41% Ass/AA+ 13.10 Total Mangan.Pass Thou 1,597,725.25 4.09% 1,620,235.15 3.07% 3,968.36 57,155.22 Aaa 4.21 niclpal Bonds 73358WAG9 Port Authority of NY B NJ TE-REV 2,440,000.00 Various 2,507,633,89 104.47 2,&19,116.80 063% Aa3/AA- 1.67 5.309% Due 121012019 4.97% 2.450,829.37 2.55% 43,1]9.8] 98,28743 AA- 1.57 64971105E8 New Yet NY TE-REV 1,400,000.00 10/27/2010 1,400,000.00 103.61 1,450,526.00 0.36% Aa1/AAA 2.59 4.075% Due 11N12020 4.08% 1,400,000.00 2.62% 23,T10.83 50,526.00 AAA 2.41 913366EJ5 Jam of California Rgta Mad TE-REV 400,000.00 1110912010 400,000.00 107.01 428,040.00 0.11% Aa3/AA- 3.13 5.035% Due05/152021 5.04% 400.000.00 2.68% 7.608.44 28.040.00 M. 2.85 4,307,633.89 4,427,682.80 1.09% Aa2I AA 2.11 Toni Municipal Bonds 4,240,000.00 4.68% 4,250,829.37 2.0% 74,559.14 176,853.43 AA 1.97 Cj'k� Holdings Report Orange County Sanitation District Long Term -Account #10268 For the Month Ending 3/31/2018 Purchase Date Cost Value Mkt Price Market Value %of Pon. Maori Maturity CUSIP Security Description ParValue/Units Book Yield Book Value Accrued Ind. GainfLoss Fitch Duration Negotiable CD 06411GXH6 Bank of Nova Scotia Yankee CD 5,825,000,00 08/082017 5,825,000.00 100,00 5,825,000,00 1.43% P-1/A-1 0.36 1.570% Due 08/09/2018 1.57% 5,825,000.00 1.57% 59,698.16 0.00 NR 0,36 5,825,000.00 5,825,000.00 1.43% Aaa IAA 0.36 Total Negotiable CD 5,825,000.00 1.57% 5,825,000.00 1.57% 59,698.16 0.00 NR 0.36 upranational 4581XOCX4 Inter AmericanDev Bank Note 3,035,00000 04/05/2017 3,027,807,05 98,53 2,990,531,18 O,73% Aim I AAA 2.12 1.625% Due05/12/2020 1.70% 3,030,068.42 234% 19,042.52 (39,537.24) AAA 2.05 45950KOMO International Finance Corp Note 2,970,000.00 0111812018 2,961,268.20 99.18 2,945,764.80 0.72% A./AAA 2.82 2.250% Due 0112512021 2.35% 2,961,194.02 2S5% 12,251.25 (16,029.22) NR 2.70 4581XOCS5 Inter-American Dev Bank Note 5,000,000.00 Various 5,059,610.00 98.11 4,905,570.00 1.19% Aim/AAA 2.96 1875% Due03115I2021 1.68% 5,026,908,22 2.54% 4.166.67 (121,338.227 AAA 2.85 45950KCJ7 International Finance Corp Note 2,500,000.00 11/09/2016 2,441,600.00 95.32 2,383,050.00 0.58% A./AAA 3.31 1.125% Due07/20/2021 1,64% 2,458,884.76 2.61% 5,546,88 (75,834,76) NR 3.20 4581XOCW6 Inter-American Dev Bank Note 3,000,000.00 01/10/2017 2,996,310.00 98.30 2,948,874.00 0.72% Asia INR 3.81 2.125% Due01118/2022 2.15% 2.997,195.12 2.60% 12,927.08 (48.321.12) AAA 3.60 459058FY4 Intl.Bank Recon&Development Note 10,000,000.00 Various 10,006,350.00 97.48 9,70,400.00 2.37% Aaa/NR 3.83 2.000% Due 0126Y2022 1.99% 10,003,666.90 2.70% W.111.12 (255,266.90) AAA 3.63 4581XOC2) Inter-American Dev Bank Note 6,500,00000 Various 6,249,655.00 96.16 6,20,413.00 1.52% NR/NR 4.46 1.750% Due09/14/2022 2.65% 6,255,947.08 2.67% 5,371.52 (5,534.08) AAA 4.24 32,742,600.25 32,172,602.98 7.02% Aaa I AAA 3.53 Total Supranatlonal 33,005,000.00 2.07% 32,734,464.52 2.61% 95,417.94 (561,861.54) Asa 3.36 US Corporate O3902CDB Bear Stearns Note 3,200,000.00 01/15/2014 3,523,520,00 100,52 3,216,51200 039% AS NR 0,25 4.650% Due O/O2/2018 2.25% 3,218,338.78 2.57% 36,786.67 (1,826.78) A+ 0.25 532457BF4 Eli Lilly&Cc Note 4,9W,000.00 Various 4,009,675.00 91 3,981,672.00 0.97% A2/AA- 0.96 1.950% Due03115/2019 1.89% 4.002.163.53 2.44% 3.466.67 (20.491.53) A 0.94 02665WAH4 American Honda Flnanoe Note 4,000,000.00 Various 4,046,640.00 99.46 3,978,452.00 0.97% A2/A+ 1.38 2250% Du,0811512019 1.93% 4,016,801+10 2.65% 11,500,00 (38,349.10) NR 1.34 06406HCW7 Bank of New York Callable Note Cent SN 112019 2,120,000.00 0211012016 2,142,175.20 99.23 2,103,650.56 0.51% At IA 1.45 2.300% Due09/11Y2o19 1.99% 2.128,61 2.88% 2,708.89 (25.013.81) AA- 1.33 24422ESS9 John Deere Capital Corp Note 5,000,000.00 Various 5,046,984.00 99.43 4,971,405.00 1.21% A2/A 1.46 2.300% Due 09/16Y2019 2.07% 5,015,649.47 2.70% 4,791.67 (44,244.47) A 1.42 36962G7MO General Electric Capital Corp Callable Note lX 5,OO ,WO.00 Various 5,014,950DO 98.47 4,923,535.00 1.20% A2IA 1.78 125/2019 2.13% 5,005,336+17 3.09% 25,055.55 (81,801.17) A+ 1.71 2.200% Due 01109n020 46625HKA7 JP Morgan Chase Callable Note Cont 12/23/2019 2,000,000.00 02/06/2015 1,994,880.00 98.78 1,975,698.00 OA8% A3/A- 1.82 2.260% Due 01Y23Y2020 2.30% 1,998,124.27 2.94% 8.WO.00 (22,426.27) A+ 1.75 40428HPR7 HSBC USA Inc Note 2,500,000.00 Various 2,472,287.50 98.69 2,467,260.00 0.60% A2IA 1.93 2.350% Due 03/0512020 2.64% 2AK657.60 3.05% 4.243.06 (19.397.60) AA- 1.86 Cj'k� Holdings Report Orange County Sanitation District Long Term -Account #10268 For the Month Ending 3/31/2018 Purchase Date Cast Value Mkt P,ic. Market Value %of Port. MoodyfS&P Maturity CUSIP S..unty D..evipti.n Par Value/Units Book Yield Book Value Mkt YTM Accrued Int. Curl Fitch Duration 747525AD5 Oualwmm Inc Note 5,000,000.00 05/19/2015 4,995,195.40 98.34 4,916,930.00 1 20% At I A 2.14 2.250% On.05Y20Y2020 2,27% 4,997,946.53 3.06% 40,937.51 (81,016,53) NR 2.05 94974BGM6 Wells Fargo Corp Note 5,000.000.00 O7/1612015 5,001,650.00 99.05 4,952.270.00 1.21% A2/A- 2.31 2.600% Due 07t2n020 2.59% 5.000,761.33 3.03% 24,916.67 (48.491.33) A+ 2.21 037833BS8 Apple Inc Callable Note Cant 1=021 4,000,000.00 05/23/2016 4,050,840.00 98.50 3,939,840.00 0.96% Aal/AA+ 2.90 2.260% Due 0=021 1.96% 4,030,689.09 2.79% 9,500.00 (9Q849.09) NR 2.77 30231GAV4 Gaon Mobil Corp Callable Note Cont 21112021 3,M,000.00 Various 3,016,097.40 98.51 2,955,318.00 0.72% Aaa/AA- 2.92 2.222% Due 03/01/2021 2.10% 3,009,858.38 236% 5,555.01 (54,540.38) NR 2.80 166764BG4 Chevron Corp Callable Note Cant 4/15/2021 2,500,000.00 0512012016 2.485,350+00 97.75 2,443,697.50 0.60% Aa2/AA- 3.13 2.100% DUe05/16n021 2.23% 2.490.800+41 2.86% 19,687.50 (47.102.91) NR 2.97 61747WAL3 Morgan Stanley Note 2,B00,000.00 0610612014 3,200,848.00 106.81 2,990,559.60 0.73% A3/BBB- 3.33 5.500% Due 07n8/2021 3,24% 2,986,877.68 3.32% 26,950.00 3,681.92 A 3.02 594918BP8 Microsoft Callable Note Cont 718121 3,1NIB.N0.00 Various 3,041,385.15 96.02 2,923,939.94 0.71% Aaa/AAA 3.36 1.550% Due08/OSn021 1.57% 3,042,574.92 2.80% 6,948.52 (118.634.98) AA+ 3.23 06406RA45 Bank of NV Mellon Corp Callable Note Cant 2,50Q000.00 0210812017 2,504,475.00 98.10 2,452,582.50 0.60% Al I A 3.86 1NI20 2.60022 Due 02I07n022 44 2.56% 2,503,4 .42 3.13% 9,750.00 (50,851.92) AA- 3.62 69353RFB9 PNC Bank Callable Note Cont 1/16/2022 1,000,000.00 03/26/2018 974,940.00 97.79 9]],908.00 0.24% A21A 3.89 2.625% Due02117n022 3.32% 975,010A9 3.23% 3,208.33 2,897.51 A+ 3.64 674599CK9 Occidental Petroleum Callable Note Cont 3/15I2022 3,350,000.00 04/25/2017 3,354,589.50 97.83 3,2T/,181.05 0.80% A31 A 4.04 2.600% Due04/15/2022 2.57% 3,353,718.99 3.18% 40,162]8 (76,537.94) A 3.75 084664BT7 Berkshire Hathaway Note 4,M,000.00 0512312017 4,131,120+00 100.05 4,001,832.00 0.98% Aa2/AA 4.13 3.000% Due05/15/2022 2.30% 4.108,T24.85 2.99% 45.333.33 (106.892.85) A+ 3.81 95000U2B8 WELLS FARGO&COMPANY Note 3,000,000.00 Various 2.954,520.00 96.73 2,901,882.00 0.71% A2I A- 4.31 2.625% Due 07n212022 2.99% 2,956,365.34 3.45% 15,093.76 (54,483.34) A+ 4.01 00440EAU1 Chubb INA Holdings Inc Callable Note Cont 4,169,000.00 Various 4,232,453.17 99.07 4,130,103.23 1.01% A31A 4.60 9/3/2022 2.54% 4,227,375.16 3.10% 49,275.26 (97.271.93) A 4.07 2.875% Duell/03n022 90331HNL3 US Bank NA Callable Note Cant 12/23/22 5,00(1,000.00 0112912018 4.981,600.00 98.73 4,936,360.00 1.20% At IAA- 4.82 2.850% Due 01nM023 2,93% 4,982,207.26 3.14% 26,916.67 (45,847,26) AA- 4.43 064061RAE7 Bank of NV Mellon Corp Callable Note Cant 1,50Q000.00 02/26/2018 1,486,065.00 98.74 1,481,152.50 0.36% At/A 4.84 2+950% 22 Due 01n9n023 PA 3.16% 1,486,313.29 3.23% 7,620.83 (5,160.79) M. 4.44 lM9/2 44932HAH6 IBM Credit Corp Note 4,665,000.00 0310912018 4,619,258.85 98.95 4,615,858.89 1.12% At/A+ 4.86 3.000% Due 0V06n023 3.22% 4,619,7"A0 3.24% 21,381.25 (3,885.21) A+ 445 83,281,499.17 81,515,599.77 19.86% Ai/A+ 2.88 Total US Corporate 82,349,000.00 2.41% 82,644,147.53 2.97% 40,289.93 (1,128,547.76) A+ 2.70 S Treasury 912828833 US Treasury Note 11,000,000.00 Various 11,042,439A9 99.49 10,944,142.00 2.66% Aaa/AA+ 0.84 1500% Due01/3112019 1.37% 11,011,427.26 2.11% 27,348.07 (67,285,26) AAA 0.82 912828SN1 US Treasury Note 5,000.000.00 1212812016 5,016,423.00 99.38 4,958,945.00 1.20% Ass/AA+ 1.00 1.500% Due03/31n019 1.35% 5,00],2]2A7 2.13% 204.92 (38.327.47) AAA 0.99 912828WS5 US Treasury Note 2,M,000.00 Various 1,996,861.44 99.32 1,986,328.00 OAS% Aaa/AA+ 1.25 1.625% Due06/30n019 1.66% 1,999,207.33 2.18% 8,169.89 (12,879.33) AAA 1.23 Cj'k� Holdings Report Orange County Sanitation District Long Term -Account #10268 For the Month Ending 3/31/2018 Purchase D:te Cost Value Mkt Price Market Value %of Port, MoodyfS&P Maturity CUSIP Security Description Par Value/Units Book Yi Id Book Veto. Mkt YTM Accrued Int. Gainli-oss Fitch Duratiou 912828WW6 US Treasury Note 5,000,000.00 Various 5,012,388,70 99.25 4,962,499.99 1.21% Ann/AA- 1.33 1.625% Due 07/31/2019 1,57% 5.003,323,98 2.20% 13,466.85 (40,823,99) AAA 1.31 91282BF39 US Treasury Note 5,000,000.00 10127/2014 5,873,186.87 99.29 5,758,541.60 1.40% Aaa/AA+ 1.50 1750% Due 09/3=019 1.48% 5,822,265A2 2.24% 271.33 (63723.82) AAA 1.47 912828G61 US Treasury Note 7,500,000.00 12/19/2014 7,449,634.50 98.17 7,407,712.50 1.80% Aaa/AA+ 1.67 1.500% Due 11/3=019 1.64% 7,483,025.37 2.26% 37,706.04 (75,312.87) AAA 1.63 912828XE5 US Treasury Note 5,M,000.00 1212112016 4,966,423+00 98.26 4,912,890.00 1.20% Aaa/AA- 2.17 1.500% Duel)&312020 1.70% 4,978,853.98 2.33% 25,137.36 (65,963.98) AAA 2.11 9128281-99 US Treasury Note 10,000,000.00 Various 9,850,311.40 97.52 9752,340.00 2.38% Aaa/AA+ 2.59 1.375% Due 10/31/2020 1.81% 9.892,661+02 2.37% 57.734.80 (140.321.02) AAA 2.50 912828N89 US Treasury Note 6,000,000.00 Various 5,895,840.41 97.22 5,833,362.00 1.42% Me/AA+ 2.84 1.375% Do.01/31/2021 1,81% 5,928710+00 2.39% 13,674.03 (95,348,00) AAA 2.75 912828TM US Treasury Note 7,000,000.00 Various 6,757,914.08 95.53 6,686,911.00 1.62% Aaa/AA+ 3.50 1.125% Due09/3=021 1.88% 6,823.669.88 2A7% 215.16 (136758.88) AAA 3.40 912828T67 US Treasury Note SM,000.00 12/13/2016 5,813,691.98 95.84 5,750,388.00 lA0% Aso/AA+ 3.59 1.250% Due 10/31=1 1.92% 5,863,144.11 2.47% 31,49171 (112,756.11) AAA 3.45 912828U65 US Treasury Note 7,M,000.00 12/28/2016 6,900,492+20 97.45 6,821,717.00 1.66% Aaa/AA+ 3.67 1.750% Due11/30/2021 2.06% 6,925,853.68 248% 41,057.69 (104,136.68) AAA 3.50 912828V22 US Treasury Note 3,000,000.00 0212712017 3.004,814.74 97.73 2,932,032.00 0.71% Aaa/AA+ 3A4 1.875% Due 01/31/2022 1.84% 3,003,75L64 2.50% 9.323.20 (71.719.641 AAA 3.66 912828076 US Treasury Note 5,000,000.00 0412512017 4,976,383.94 97.17 4,858,595.00 1.18% Aaa/AA, 4.00 1.750% Due 03/31/2022 1.85% 4.980,8"75 2.50% 239.07 (122,249.75) AAA 3.83 912828M5 US Treasury Note 5,000,000.00 07/2512017 4,973,454.25 96.92 4,845,W0.00 1.18% Aaa/AA+ 4.25 1.750% Due 06130Y2022 1.86% 4,971,126Al 2.52% 21,995.86 (131,226.41) AAA 4.W 912828124 US Treasury Note 6,000,000.00 09/27/2017 5,987,832.60 97.26 5,835.702.00 1A2% Aso/AA+ 4.42 1.875% Due 0W31Y2022 1.92% 5,989,084.53 2.53% 9,782.61 (153,382.53) AAA 4.20 91282BL57 US Treasury Note 13,000,000.00 Various 12,763,554.69 96.66 12,565,826.00 3.04% Aaa/AA+ 4.50 1.750% Due09/3=022 2.15% 12,T/7,557.44 2.54% 621.58 (211,731.44) AAA 4.29 912828MM US Treasury Note 8.000.00000 12/22/2017 7,907,500+00 97.61 7,809,064.00 1.90% Aaa/AA+ 4.67 2000% Due 11/30/2022 2.25% 7.912433.33 2.55% 53,626.37 (103.369.33) AAA 4.39 9128281,130 US Treasury Note 5,000,0000o 0112412018 4,926.562.50 98.07 4,903710.00 1.19% Aaa/AA+ 4.78 2.125% Due 12131/2022 2.44% 4.929,253.71 2.56% 26,709.25 (25,543.71) AAA 4.46 912828WUO US Treasury Inflation Index Note 10,854,584.00 Various 10,740,937.66 97.70 10,604,863.42 2.57% Aaa/AA+ 6.30 0.125% Due07/15P2024 0.23% 10782,809.01 0.50% 2,848.57 (M,945.59) AAA 6.25 131,856,647.15 130,141,469.51 31.62% Aaa/AA+ 3.27 Total US Treasury 133,154,584.00 1.70% 132,092,275.32 2.23% 381,630.36 (1,950,805.81) Aaa 3.15 416,484,199.84 411,30,114.15 100.00% Aa1/AA+ 2.72 TOTAL PORTFOLIO 417,366,895.61 1.97% 416,088,321.50 2.42% 1,45g333.40 (4,735,207.35) Aaa 2.41 TOTAL MARKET VALUE PLUS ACCRUALS 412,803,447.55 Cj'k� Holdings Report Orange County Sanitation District Liquid -Account #10282 For the Month Ending 3/31/2018 Purchase Date Cost Value Mkt Price Market Value %of Pon. Mooi Maturity CUSIP Security Description ParValue/Units Book Yield Book Value MktY`pM Accrued Int. Gaml Fitch Duration Agency 3131EAEA3 FHLMC Note 800,000.00 11/30/2017 798,240.00 99,98 799,844,80 0.86% Aaa/AA- 0.02 0.750% Due 04/09/2018 1,37% 799,890.85 1.62% 2,866.67 (46.051 AAA 0,02 313385VZ6 FHLB Discount Note 2,50Q000.00 03128/2018 2496723.61 99.89 ?49],191.6] 2.69% P-1IA-1+ 0.07 1.685% Dull 171% 2,497,191,67 1J1% 0.00 0.00 F-1+ 0.07 313385YB6 FHLB Discount Note 10.000.000.00 02/26/2018 9,949,900,00 99.66 9,965,672.22 1013% P-1IA-1+ 0.21 1.670% Due06/14/2018 170% 9.965,672.22 1+70% 000 000 F-1+ 0.20 13,244,863.61 13,262,708.69 14.28% Aaa/AAA 0.17 Total Agency 13,300,000.00 1.68% 13,262,754.74 1.70% 2,866.67 (48.05) Aaa 0.17 Pommercial Paper 69372BEO9 Paccar Financial Discount CP 1,500,000.00 0212612018 1.493,293.75 99.73 1,495,914.58 1.61% P-1/A-1 0.15 1.850% Du,0512412018 1.88% 1.495.914.58 1.88% 0.00 0.00 NR 0.15 06538CFDB Bank of Tokyo Mitsubishi NY Discount CP 1,855,000.00 03/13/2018 1,845,044.83 99.57 1,847,100]9 1.99% P-1/A-1 0.20 2.100% Due 01 2.14% 1,847,100.79 2.14% 0.00 0.00 NR 0.20 89233HFE9 Toyota Motor Credit Discount CP 1,800,000.00 01 1,788,516.50 99.60 1,792,859.00 1.93% P-1/A-1+ 0.21 1S30% Due06/14Y2018 1.97% 1.792,859.00 lSi 0.00 0.00 NR 0.20 OM06XG65 Bank of New York Mellon Discount CP 1,m,000.00 03/29/2018 993,840.00 99.40 994,026.67 lDi P-1/A-1+ 0.27 2.240% Dull 2.29% 994,026.67 2.29% 0.00 0.00 F-1+ 0.26 21681 Rabobank Nederland NV NY Discount CP 1,5W,000.00 0312012018 1,482,252+50 98.88 1,481 1.60% P-1/A-1 0.48 2.290% Dull 2.35% 1,481 2.35% 0.00 0.00 NR 0.48 7,602,947.58 7,613,107.71 8.20% P-1 IA-1 0.26 Total Commercial Pacer 7,655,000.00 2.11% 7,613,107.71 2.11% 0.00 0.00 F-1+ 0.25 oney Market Fund FI mu 31846V567 First American Goi Obligation MMKT Class-Z 19,095,907,39 Various 19,095,907,39 1,00 19,095,907,39 20.56% Aaa I AAA 0,00 1.49% 19,095,907,39 1.49% 0.00 0.00 AAA 0.00 19.095,907.39 19,095,907.39 20.m% Aaa/AAA 0.00 Total Money Market Fund FI 19,095,907.39 1.49% 19,095,907.39 1.0% 0.00 0.00 Aaa 0.00 Negotiable Cr IL 78012UAX3 ROYAL BANK OF CANADA Yankee CD 1,M,000.00 02/27/2018 1,000,000+00 100.00 1,000,000.00 1.08% P-1/A-1+ 0.66 2.320% Dull 2.32% 1,000,000.00 2.32% 2,062.22 0.00 F-1+ 0.65 1,000,000.00 1,000,000.00 1.08% Asa/AAA 0.66 Total Negotiable CD 1,000,001 2.32% 1,000,000.00 2.32% 2,062.22 0.00 Aaa 0.65 Supranational 459501 International Finance Corp Note 2,500,000,00 Various 2,490,715.00 9978 2,494,450,00 2.69% Aaa IAAA 021 0.875% Due 06/15/2018 1.61% 2,496,236.76 1.95% 6,440.97 (1,78676) NR 0.20 2,490,715.00 2,494,450.00 2.69% Aaa I AAA 0.21 Total Supranational 2,500,000.00 1.61% 2,496,236.76 1.95% 6,440.97 (1,786.76) NR 0.20 Cj'k� Holdings Report Orange County Sanitation District Liquid -Account #10282 For the Month Ending 3/31/2018 Purchase Date Cost Value Mkt Price Market Value %of Pon. MoodyfS&P Maturity CUSIP Security Description ParValue/Units Book Yield Book Value MMYTIM Accrued Int. Gainfl-obus Fitch Duration US Corporate 084664BEO Berkshire Hathaway Note 1,M,00000 1210412017 1,016,250.00 100,32 1,003,152,00 1.10% Aa21 AA 0.12 5.400% Due05/15/2018 1.71% 1,004,440,99 2,76% 20,400.00 (1,288.991 A+ 0,12 46625HJL5 JP Morgan Chase Note 1,25),000.00 0211612018 1 249,525.00 99.90 1 248710.00 1.35% A31 A- 0.12 1625% Bull 1,78% 1,249,748.19 2.46% 7,673.61 (1,038.19) A+ 0.12 857477AK9 State Street Bank Note 2,100,000.00 Various 2,096,898.00 99.85 2,096,952.90 2.27% At I A 0.12 1.350% Due05115I2018 2.12% 2.098,00724 2.53% 10,71000 (1,054.34) AA- 0.12 58933YAGO Merck 8 Cc Note 1,000,000.00 1210112017 998880.00 99.88 998,830.00 1.08% AllAA 0.13 1.300% Due05/18I2018 1.55% 999,679.02 2.19% 4,80218 (849.02) A 0.13 717081DWO Pfizer Inc. Note 1,000,000.00 01/04/2018 997,970.00 99.86 998,625.00 1.08% All AA 0.17 1.200% Due06/012018 1.71% 999,140.07 2.02% 4,000.00 (515.07) A+ 0.17 OW50TMC3 Bank of America Note 1,000,000.00 02/20/2018 999,110.00 99.87 998,671.00 1.08% Aa3/A+ 0.18 1.750% Dull 2.05% W9,449.05 2.49% 5,638.89 (778.05) A+ 0.18 17215RAU6 Cisco Systems Note 1,0W,000.00 1210112017 1,000,150+00 99.92 999,229.00 1.08% A11AA- 0.21 1.650% Due06/15/2018 1.62% 1,000,058.59 2.02% 4,058.33 (829.59) NR 0.20 24422ESXB John Deere Capital Corp Note 1,50, 000.00 0212212018 1,497,600.00 99.79 1,496,88].50 1.62% A2I A 0.28 1.600% Due0Tl1312018 2.02% 1498,195.62 2.33% 5,200.00 (1,308.12) A 0.28 808513AJ4 Charles Schwab Corp Callable Note Cant 612512018930,000.00 11/29/2017 931,841.40 99.97 929,710]] 1.01% A2IA 0.32 2.200% Due07125/2018 1.89% 930,897+29 2.30% 3751.00 (1,186,52) A 0.23 40428HPJ5 HSBC USA Inc Note 619,000.00 0211312018 620,281.33 99.98 618,899.72 0.67% A2/A 0.48 2.625% Due09Y24Y2018 2.28% 620,020,43 2.66% 315.95 (1,120.71) AA- 0.47 11,408,505.73 11,389,667.89 12.34% At IA+ 0.20 Total US Corporate 11,399,000.00 1.89% 11,399,63649 2.38% 67,350.56 (9,968.60) A+ 0.19 ,US Treasury Ni 912828VE7 US Treasury Note 8,000,000.00 Various 7,98375000 99.88 7,990744.00 8.63% Aaa/AA« 0.17 1000% Due05/31/2018 146% 7,993,948,31 169% 26,813A9 (3,20431) AAA 0.17 912796PV US Treasury Bill 15,000,000.00 Various 14,917,779S6 99.70 14,954,818.89 16A0% P-1IA-1+ 0.21 1.465% Due06/14W8 1.49% 14,954,818.89 1.49% 0.00 0.00 F-1+ 0.20 912828S68 US Treasury Note 15,W0,000.00 Various 14,932,226+57 99.64 14,946,615.00 16.11% Aaa/AA+ 0.33 0.750% Bull 1.61% 14,957,45814 1.81% 18,646.41 (10,783.74) AAA 0.33 37,033,756.43 37,892,237.89 40.85% Asia/AAA 0.25 Total US Treasury 3$000,000.00 1.53% 37,906,225.94 1.68% 45,459.60 (13,988.05) Asia 0.25 92,676,695.74 92,748,079.57 100.00% An1AAA 0.18 TOTAL PORTFOLIO 92,949,907.39 1.65% 92.773,869.03 1.77% 124,10002 (25,I89.48) Asia 0.18 TOTAL MARKET VALUE PLUS ACCRUALS 92,872,259.59 Cj'k� Holdings Report OCSD Lehman Exposure -Account #10284 For the Month Ending 3/31/2018 Purchase Date Cost Value Mkt Price Market Value %of Pon. MoodyIS&P Maturity CUSIP Security Description ParValue/Units Book Yield Book Value MMYTM Accrued Ind. GainfLoss Fitch Duration Common Stock SLHOPNTA4 Lehman Brothers, Inc Open Position Long 60,64149 1l2l2i)14 57842.64 OA2 25,621.03 1972% NR/NR 000 Exposure 0.00% 57,84264 000% 000 (32.22161) NR 0.00 0.000% Due03/392018 57,842.64 25,621.03 19.72% NR/NR 0.00 Total Common Stock 60,641.49 0.00% 57,842.64 0.00% 0.00 (32,221.61) NR 0.00 S Corporate 525ESCIB7 Lehman Brothers Note-Defaulted 600,000.00 09/1912008 331,90374 4.05 24,300.00 18.70% NR/NR 0.82 0.000% Due01Y24Y2019 0.00% 331,901 0.00% 0.00 (307.603.74) NR 0,00 525ESCOY6 Lehman Brothers Note-Defaulted 2,000,000.00 0911812008 1,0701 4.00 50,000.00 61.58% NR/NR 31,58 0.000% Due 10Y22I2049 0.00% 1,070,782.46 0.00% 0.00 (990,782.46) NR 0.00 1,402,686.20 104,300.00 80.28% NR/NR 24.42 Total US Corporate 2,600,000.00 0.00% 1,402,686.20 0.00% 0.00 (1,298,386.20) NR 0.00 1,460,528.84 129,921.03 100.00% NR/NR 19.60 TOTAL PORTFOLIO 2,660,641.49 0.00% 1,460,528.84 0.00% 0.00 (1,330,607.81) NR 0.00 TOTAL MARKET VALUE PLUS ACCRUALS 129,921.03 Coil SECTION 5 Transactions Cj'k� Transaction Ledger Orange County Sanitation District Long Term -Account #10268 December 31, 2017 through March 31, 2018 Transaction Send.an.nor AcqlDisp Interest Ty" Date CUSIP Quantity Security Description Price Yield Amount Pur/Sold Total Amount Gaml ertnn�4 Purchase 01/17/2018 40,12801 3,000,000.00 HSBC Holdings PLC Note 99088 289% 2,972,640.00 2,650.00 2,975,290.00 0.00 2 65%Due:01/05/2022 Purchase 0111912018 313385SUl 1,300,000.00 FHLB Discount Note 99.930 1.34% 1,299,094.33 0.00 1,299,094.33 0.00 1.32%Due:02/0712018 Purchase 0111912018 313385SW7 7,400,000.00 FHLB Discount Note 99.924 1.33% 7,394,345.17 0.00 7,394,345.17 0.00 1.31%Due:0210912018 Purchase 01/1912018 313385TH9 1,100,000.00 FHLB Discount Note 99,881 1.36% 1,098,689.78 0.00 1,098,689.78 0.00 1.34%Due:02120/2018 Purchase 01/2412018 313385TJ5 7,500,000.00 FHLB Discount Note 99.897 1.M% 7,492,311.67 0.00 7,492,311.67 0.00 1.318%Due:0021/2018 Purchase 01/2412018 9501 1,500,000.00 WELLS FARGO&COMPANY Note 98.413 3.01% 1,476,195.00 218.75 1,476,413.75 0.00 2.625%Due:0712M022 Purchase 01/2512018 45950KCMO 2,970,000.00 International Finance Cory Note 99.706 2.35% 2,%1,268.20 0.00 2,961,268.20 0.00 2.25%Due:01125/2021 Purchase 01/25/2018 9128281430 5,000,000.00 US Treasury Note 98.531 2.44% 4,926,562.50 7,337.71 4,933,900.21 0.00 2.125%Due:1213112022 Purchase 0112512018 9501 1,500,000.00 WELLS FARGO&COMPANY Note 98.555 2.97% 1,478,325.00 328.13 1,478,653.13 0.00 2.625%Due:0712212022 Purchase 01130/2018 313385TDB 13,000,000.00 FHLB Discount Nate 99.939 1.32% 12,992,019.44 0.00 12,91 0.00 1.3%Due:02116/2018 Purchase 0113112018 89238BAB8 5,170,000.00 Toyota Auto Receivables Owner 2018-A A2A gg 990 2.12% 5,169,471.63 0.00 5,169,471.63 0.00 2.1%Due: 1011512020 Purchase 0113112018 901 5,000,000.00 US Bank NA Callable Note Cont 12/23/22 99.632 2.93% 4,981,600.00 3,166.67 4,984,766.67 0.00 2.85%Due:01/2312023 Purchase 0210912018 43814RAC0 2,875,000.00 Honda Auto Receivables 20164 A3 98.902 2.58% 2,843,442.38 2,029.27 2,845,471.65 0.00 1.21%Due: 1211812020 Purchase 02/1312018 65477UAD2 1,800,000.00 NAROT 2015-A4 99,375 1.86% 1,788.750.00 2,100.00 1,790,850.00 0.00 1.5%Due:091 Purchase 02/14/2018 65478VAD9 2,000,000.00 NAROT 2016-B A3 99,199 1.87% 1,983,984.38 2,126.67 1,986,111.05 0.00 1.32%Due:0111512021 Cj'k� Transaction Ledger Orange County Sanitation District Long Term -Account #10268 December 31, 2017 through March 31, 2018 Transaction Settlement Acq/Disp Interest Type Date CUSIP Quantity Security Description Price Yield Annot.t Pur/Sold Total Amount Gain/Loss Purchase 02/2612018 69372BEQ9 5,000,000.00 Paccar Financial Discount CP 99.553 1.88% 4,9T1,645.83 0.00 4,97],645.83 0.00 1.85%Due:05/2412018 Purchase 0212712018 313385UN4 5,000,000.00 FHLB Discount Note 99.914 1A2% 4,995,722.22 0.00 4,995,722.22 0.00 1.4%Due:03121/2018 Purchase 0212712018 313385UV6 1,500,000.00 FHLB Discount Note 99.882 lA9% 1,498.223.75 0.00 1,498,223.75 0.00 1.47%Due:0312812018 Purchase 02/2712018 3137EAEL9 7,500,000,00 FHLMC Note 99.793 2AS% 7,484,475.00 5,442.71 7,489,917.71 0.00 2.375%Due:021612021 Bank of NV Mellon Corp Callable Note Court Purchase 02/28/2018 06406RAE7 1,500,000.00 1229/2022 99.071 3.16% 1,486,065.00 3,564.58 1,489,629.58 0.00 2.95%Due:0112912023 Purchase 0212812018 4581%OCZ9 6,000,000.00 Inter-Amancan Day,Bank Note 95.573 2.79% 4,778,650.00 39,861.11 4,818,511.11 0.00 1.75%Due:0911412022 Purchase 0212812018 4T188CAC6 1,340,000.00 John Deere Owener Trust 2016-B A4 99.993 2.68% 1,339,903.65 0.00 1,339,903.65 0.00 2.66%Due:0411812022 Purchase 0311312018 065380FD8 8,240,000.00 Bank of Tokyo Mitsubishi NV Discount CP 99.463 2.14% 8,195P8.67 0.00 8,195,778.67 0.00 2.1%Due:0811312018 Purchase 03/1312018 44932HAH6 1,680,000.00 IBM Credit Corp Note 99,031 3.22% 1,663,720.80 5,180.00 1,668,900.80 0.00 3%Due:02106=3 Purchase 03/13/2018 44932HAH6 2,985,000.00 IBM Credit Corp Note 99.013 3.22% 2,955,538.05 9,203.75 2,964,741.80 0.00 3%Due:0V06=3 Purchase 03/20/2018 404280BF5 1,500,000.00 HSBC Holdings PLC Note 97.156 3.46% 1,457,340.00 8,281.25 1,465,621.25 0.00 2.65%Due:01105/2022 Purchase 03/20/2018 47788CAB8 1,800,000.00 John Deere Onener Trust 2018-A A2 99.797 2.59% 1,796,343.75 2,420.00 1,798,763.75 0.00 2.42%Due: 10/15/2020 Purchase 03/21/2018 313385VE3 4,350,000.00 FHLB Discount Note 99924 172% 4,346,713.33 0.00 4,346,713.33 0.00 1.7%Due:04106/2018 Purchase 03/22/2018 89233HE75 8,000,000.00 Toyota Motor Credit Discount CP 99.759 1.92% 7,980,680.00 0.00 7,980,680.00 0.00 1.89%Due 05/07/2018 Purchase 0312812018 313385VZ6 10,000,000.00 FHLB Discount Note 99.869 1.71% 9,986,894.44 0.00 9,986,894.44 0.00 1.685%Due'0412512018 Purchase 0312812018 69353RFB9 1,000,000.00 PNC Bank Callable Nate Cant 1/18/2022 97.494 3.32% 974,940.00 2,989.58 977,929.58 0.00 2.625%Due:0211712022 Cj'k� Transaction Ledger Orange County Sanitation District Long Term -Account #10268 December 31, 2017 through March 31, 2018 Transaction Settlement Acq/Disp Interest Type Date CUSIP Quantity Security Description Price Yield Amot.t Pur/Sold Total Amount Gain/Loss Purchase 03/2912018 3135GOT94 3,000,000.00 FNMA Nate 98.547 2.70% 2,956,410.00 13,062.50 2,969,472.50 0.00 2,375%Due:01/19/2023 Purchase 0312912018 4581XOCS5 1,500,000.00 Inter-American Day Bank Note 97.947 2.60% 1,469,205.00 1,093.75 1,470,298.75 0.00 1.875%Due:03/15/2021 Subtotal 132,010,000.00 131,202,948.97 111,056.43 131,314,005.40 0.00 Security 0312812018 912828WUD 26,416.00 US Treasury Inflation Index Note 100.000 26.416.00 6.57 26,422.57 0.00 Contribution 0.125%Due:07/15/2024 Security 0313112018 912828WUO 30,368.00 US Treasury Inflation Index Note 100.000 30,368.00 7.86 30,375.86 0.00 Contribution 0.125%Due:07/15/2024 Subtotal 56,784.00 56,784.00 14.43 56,798.43 0.00 TOTAL ACQUISITIONS 132,066,784.00 131259,73297 111,070.86 131,370.803.83 0.00 DISPOSITIONS Maturity 01/11/2018 313385RR9 4,750,000,00 FHLB Discount Note 100,000 4,750,000.00 0.00 4,750,000.00 0.00 1.27%Due:01/11/2018 Maturity 01/1212018 3137EADN6 4,000,000.00 FHLMC Note 100.000 4,000,000.00 0.00 4,000,000.00 0.00 0.75%Due:0111212018 Maturity 01/1612018 40428HPH9 3,000,000.00 HSBC USA Inc Note 100.000 3,000,000.00 0.00 3,000,000.00 0.00 1.625%Due:01/1612018 Maturity 01/1812018 38141 GF04 600,000.00 Goldman Sachs Group Inc Note 100.000 600,000.00 0.00 600,000.00 0.00 5.95%Due:01118/2018 Maturity 01/19/2018 313385RZI 12,100,000.00 FHLB Discount Note 100.000 12,100,000.00 0.00 12,100,000.00 0.00 1.27%Due:01/19/2018 Maturity 0112312018 88059OSD7 8,000,000.00 TVA Dismount Note 100.000 8,000,000.00 0.00 8,000,000.00 0.00 1.27%Due:01/23/2018 Maturity 01124/2018 313385SE7 6,225,000.00 FHLB Discount Note 100.000 6,225,000.00 0.00 6,225,000.00 0.00 1.265%Due:0112412018 Maturity 0210712018 313385SU1 1,300,000.00 FHLB Discount Note 100.000 1,300.000.00 0.00 1,300,000.00 0.00 1.32%Due:02/07/2018 Maturity 0210912018 313385SW7 7,400,000.00 FHLB Discount Note 100.000 7,400.000.00 0.00 7,400,000.00 0.00 1.31%Due:0210912018 Cj'k� Transaction Ledger Orange County Sanitation District Long Term -Account #10268 December 31, 2017 through March 31, 2018 Transaction Settlement Acq/Disp Interest Type Date CUSIP Quantity Security Description Price Yield Arrammt Pur/Sold Total Amount Gain/Loss Maturity 02/1512018 674599CD5 2,000,000.00 Occidental Petroleum Callable Nate Conn 1/15/18 100.000 2p00,000.00 0.00 2,000,000.00 0.00 1.5%Due:02/15/2018 Maturity 0211612018 3133MTDB 13,000,000.00 FHLB Discount None 100.000 13p00,000.00 Dw 13,000,000.00 Dw 1.3%Due:02/16/2018 Maturity 02/20/2018 313385TH9 1,100,000.00 FHLB Discount Note 100.000 1,100,000.00 0.00 1,100,000.00 0.00 1.34%Due:02/2012018 Maturity 0212112018 313385TJ5 7,500,000,00 FHLB Discount Note 100.000 7,500,000.00 0.00 7,500,000.00 0.00 1.318%Due:02/21/2018 Maturity 02/2812018 912828UR9 3,500,000.00 US Treasury Note 100,000 3,500,000.00 0.00 3,500,000.00 0.00 0.75%Due:0212812018 Maturity 03I0712018 3137EADP1 5,000,000.00 FHLMC Note 100.000 5,000,000.00 0.00 5,000,000.00 0.00 0.875%Due:03107/2018 Maturity 03/0912018 31337BA43 7,500,000.00 FHLB Note 100.000 7,W0,000.00 0.00 7,500,0W.W 0.00 1.375%Due:03/09/2018 Maturity 03/13/2018 06538CCD1 6,665,000.00 Bank of Tokyo Mitsubishi NY Discount CP 99497 6,665,000.00 0.00 6,665,0W.W 0.00 1.45%Due:03113/2018 Maturity 03/19/2018 025816AY5 2,900,000.00 American Express Credit Note 100.000 2,900,000.00 0.00 2,900,0W.W 0.00 7%Due:03/19/2018 Maturity 0312112018 313385UN4 5,000,000.00 FHLB Discount Note 100.000 5,000,000.00 0.00 5,000,000.00 0.00 1.4%Due:03/21/2018 Maturity 0312812018 313385UV6 1,500,000.00 FHLB Discount Note 100.000 1,500,000.00 0.00 1,500,000.00 0.00 1.47%Due:0 312 812 01 8 Subtotal 103,040,0W.W 103,040,000.00 0.00 103'"0'000.00 0.00 Security 02/27/2018 912828WUO 6,136.00 US Treasury Inflation Index Note 99768 6,136.00 0.00 6,136.00 41.38 Withdrawal 0.125%Due:07/15/2024 Subtotal 6,136.00 6,136.00 0.00 6,136.00 41.38 TOTAL DISPOSITIONS 107,021,156.55 107.021.156.55 111,796.04 107,132,952.59 41.38 Cj'k� Transaction Ledger Orange County Sanitation District Liquid -Account #10282 December 31, 2017 through March 31, 2018 Type Date CUSIP Quantity Security Description Price Yield Amount Pur/Sold Total Amount GamI ertnrnsrtlnua Purchase 01/08/2018 717081DW0 1,000,000.00 Pfizer Inc. Note 1 2%Due 06/01/2018 gg 7g7 1.71% 997,970.00 1,233.33 999,203.33 0.00 : Purchase 01/17/2018 313385SL1 4,600,000.00 FHLB Discount Note 99.953 1.32% 4,597.840.56 0.00 4,597,840.56 0.00 1.3%Due:01/3012018 Purchase 0112312018 313385SL1 3,300,000.00 FHLB Discount Note 99.975 1.30% 3,299,178.67 0.00 3,299,178.67 0.00 1.28%Due:0113012018 Purchase 01/2412018 313385SK3 15,000,000.00 FHLB Discount Note 99,982 1.32% 14.997,291.67 0.00 14,997,291.67 0.00 1.3%Due:01/29/2018 Purchase 01/3012018 313385TDB 5,000,000.00 FHLB Discount Note 99.939 1.32% 4,996,930.56 0.00 4,996,930.56 0.00 1.3%Due:0211WM18 Purchase 01/30/2018 9127%PL7 10,000,000.00 US Treasury Bill 99.452 1.49% 9,945,231.25 0.00 9,945,231.25 0.00 1.46%Dua:06/14/2018 Purchase 01/30/2018 91282BS68 5,000,000.00 US Treasury Note 99.570 1.61% 4,978,515.63 18,648.10 4,997,163.73 0.00 0.75%Due:07/31/2018 Purchase 01/31/2018 313385TP1 7,500,000.00 FHLB Discount Note 99.905 1.33% 7,492,904.17 0.00 7,492,904.17 0.00 1,31%Due:02/26/2018 Purchase 01/31/2018 912796PL7 5,000,000.00 US Treasury Bill 99.451 1.50% 4,972,548.61 0.00 4,972,548.61 0.00 1.475%Due:06/14/2018 Purchase 01131/2018 912828568 5,000,000.00 US Treasury Note 99.570 1.62% 4,978.515.63 0.00 4,978,515.63 0.00 0.75%Due:07/31/2018 Purchase 02115/2018 4042BHP,5 619.000.00 HSBC USA Inc Note 100.207 2.28% 620,281.33 6,364.09 626,645.42 0.00 2.625%Due:09/24/2018 Purchase 0211512018 89233HFE9 1,800,000.00 Toyota Motor Credit Discount CP 99.362 1.97% 1,788,516.50 0.00 1,788,516.50 0.00 1.93%Due:H/1412018 Purchase 02/20/2018 06050TMC3 1,000,000.00 Bank of America Note 99.911 2.05% 999,110.00 3,645.83 1,002,755.83 0.00 1.75%Due:0610512018 Purchase 02/2112018 46625HJL5 1,250,000.00 JP Morgan Chase Note 99,962 1.78% 1,249.525.00 5,416.67 1,251,9,11.67 0.00 1.625%Due:05/15/2018 Purchase 02/26/2018 24422ESX8 1,500,000.00 John Deere Capital Corp Note 99,840 2.02% 1,497,600.00 2,866.67 1,500,466.67 0.00 1.6%Due:07/13/2018 Cj'k� Transaction Ledger Orange County Sanitation District Liquid -Account #10282 December 31, 2017 through March 31, 2018 Transaction Settlement Acql Interest Type Date CUSIP Quantity Security Description Price Yield Annot.t Pur/Sold Total Amount Gain/Loss Purchase 02/2612018 313385YBB 10,000,000.00 FHLB Discount Note 99499 1.70% 9,949,900.00 0.00 9,949,900.00 0.00 1.67%Due:06/14/2018 Purchase 0212612018 69372BEQ9 1,500,000.00 Paccar Financial Discount OP 99.553 1.88% 1,493,293.75 0.00 1,493,293.75 0.00 1.85%Due:05/2412018 Purchase 0212712018 8574nW9 1,300,000.00 State Street Bank Note 99.866 1.96% 1,298,258.00 4,972.50 1,303,230.50 0.00 1.35%Due:0 5/1 512 01 8 Purchase 0212812018 78012UAX3 1,000,000,00 ROYAL BANK OF CANADA Yankee CD 100.000 2.32% 1,000,000.00 0.00 1,000,000.00 0.00 2.32%Due: 1112 712 01 8 Purchase 03/1312018 065380FD8 1,855,000.00 Bank of Tokyo Mitsubishi NY Discount CP 99,463 2.14% 1,845,044.83 0.00 1,845,044.83 0.00 2.1%Due:0611312018 Purchase 03/16/2018 8574AAK9 800,000.00 State Street Bank Note 99.830 2.38% 79$640.00 3,630.00 802,270.00 0.00 1.35%Due:0511512018 Puchase 03/22/2018 21687BJ05 1,500,000.00 Rabobank Nederland NV NY Discount CP 98.817 2.35% 1,482,252.50 0.00 1,482,252.50 0.00 2.29%Dua:09124/2018 Purchase 03/2812018 313385VZ6 2,500,000.00 FHLB Discount Note 99.869 1.71% 2,496,723.61 0.00 2,4%,723.61 0.00 1.685%Due:04/2512018 Purchase 03/29/2018 OM06XG65 1,000,000.00 Bank of New York Mellon Discount CP 99384 2.29% 91 0.00 993,840.00 0.00 2.24%Due:07/06/2018 Subtotal 89,024,000.00 $8,769,912.27 46,M.19 88,816,689.46 0.00 TOTAL ACQUISITIONS $9,024,000.00 88.769.912.27 46.777.19 88,816,689.46 0.00 DISPOSITIONS Call 01124/2018 69353REJ3 1,000,000.00 PNC Bank Callable Note Cont 1/24/2018 100.000 1.50% 1,000,000.00 6,291.67 1,006,291.67 0.00 1.5%Due:02/23/2018 Call 0210112018 46623EKDO 1,000,000.00 JP Morgan Chase Callable Nate Cont 2/1/2018 100.000 1.69% 1,000,000.00 7,083.30 1,007,083.30 89.28 1.7%Due:0310112018 Call 0210812018 808513AKI 1,000,000.00 Charles Schwab Corp Callable Note Cont 211012018 100.000 1.50% 1,000,000.00 6,166.60 1,006,166.60 -105.77 1.5%Due:03110/2018 Subtotal 3,000,000.00 3,000,000.00 19,541.57 3,019,541.57 -16.49 Maturity 0111112018 313385RR9 4,750,000.00 FHLB Discount Note 100.000 4,750,000.00 0.00 4,750,000.00 0.00 1.27%Due:0111112018 Cj'k� Transaction Ledger Orange County Sanitation District Liquid -Account #10282 December 31, 2017 through March 31, 2018 Transaction Settlement Acqi Interest Type Date CUSIP Quantity Security Description Price Yield Amac.t Pur/Sold Total Amount Gain/Loss Maturity 01/15/2018 46625HGY0 1,000,000.00 3P Morgan Chase Nate 100.000 1p00,000.00 0.00 1,000,000.00 0.00 6%Due:01/15/2018 Maturity 0111512018 912828H37 10,500,000.00 US Treasury Note 100.000 10,500,000.00 0.00 10,500,000.00 0.00 0.875%Due:01/15/2018 Maturity 0111612018 24422EST7 1,000,000.00 John Deere Capital Corp Note 100.000 1,000,000.00 0.00 1,000,000.00 0.00 1.35%Due:01/1612018 Maturity 0111612018 40428HPH9 1,000,000,00 HSBC USA Inc Note 100.000 1,000,000.00 0.00 1,000,000.00 0.00 1.625%Due:01/16/2018 Maturity 01/1712018 313385RX6 1,000,000.00 FHLB Discount Note 100,000 1,000,000.00 0.00 1,000,000.00 0.00 1.28%Due:0111712018 Maturity 01/23/2018 69372BAP5 1,500,000.00 Paccar Financial Discount CP 99.843 1,500,000.00 0.00 1,500,0W.W 0.00 1.45%Due:0112 312 01 8 Maturity 01/23/2018 8801 10,000,000.00 TVA Discount Note 100.000 10,000,000.00 0.00 10,000,0W.W 0.00 1.27%Dua:01123/2018 Maturity 01/2512018 06406HCE7 870,000.00 Bank of New York Callable Note Cont 12125Y2017 100.000 870,000.00 0.00 870,0W.W 0.00 1.3%Due:01/2512018 Maturity 01/29/2018 313385SK3 15,000,000.00 FHLB Discount Note 100.000 15,000,000.00 0.00 15,000,000.00 0.00 1.3%Due:0112912018 Maturity 01I30I2018 313385SL1 11,500,000.00 FHLB Discount Note 100.000 11,500,000.00 0.00 11,500,000.00 0.00 1.29%Due:01/30/2018 Maturity 0113012018 89233HAW4 1,300,000.00 TOyola Motor Credit Discount CP 99.708 1,300,000.00 0.00 1,300,000.00 0.00 1.3%Due:01/30/2018 Maturity 01131/2018 06538CAX9 2,000,000.00 Bank of Tokyo Mitsubishi NY Discount CP 99.818 2p00,000.00 0.00 2,000,000.00 0.00 1.6%Due:01/31/2018 Maturity 0113112018 313385SM9 19,500,000.00 FHLB Discount Note 100.000 19,500,000.00 0.00 19,500,000.00 0.00 1.278%Due:01/31/2018 Maturity 0113112018 91282OP20 35,000,000.00 US Treasury Note 100.000 35,000.000.00 0.00 35,000,000.00 0.00 0.75%Due:0113112018 Maturity 0211612018 313385TD8 5,000,000.00 FHLB Discount Note 100.000 5,000,000.00 0.00 5,000,000.00 0.00 1.3%Due:02/16/2018 Maturity 02/2212018 02N5KSN6 1,000,000.00 American Honda Discount CP 99,724 1,000,000.00 0.00 1,000,000.00 0.00 1.53%Due:02122/2018 Cj'k� Transaction Ledger Orange County Sanitation District Liquid -Account #10282 December 31, 2017 through March 31, 2018 Transaction Settlement Acq/Disp Interest Type Date CUSP Quantity Security Description Price Yield Annati.t Pur/Sold Total Amount Gain/Loss Maturity 02/2612018 313385TP1 7,500,000.00 FHLB Discount Note 100.000 7,W0,000.00 0.00 7,500,000.00 0.00 1.31%Due:02/2612018 Maturity 03I0612018 30231GAL6 1,000,000.00 E.n Mobil Cory Note 100.000 1,OW,WO.00 O.W 1,000,000.00 O.W 1.305%Due:03/06/2018 Maturity 0310712018 3137EADP1 2,500,000.00 FHLMC Note 100.000 2,500,000.00 0.00 2,500,OW.W 0.00 0.875%Due:03/07/2018 Maturity 0311312018 02665WAT8 1,000,000,00 American Honda Finance Note 100.000 1,000,000.00 0.00 1,000,000.00 0.00 1.5%Due:03/13/2018 Maturity 03/1312018 06538CCD1 1,000,000.00 Bank of Tokyo Mitsubishi NV Discount CP 99497 1,000,000.00 0.00 1,000,000.00 0.00 1.45%Due:0311312018 Maturity 03/15/2018 4581XOBZO 3,000,000.00 Inter-American Day,Bank Note 100.000 3,W0,000.00 0.00 3,000,000.00 0.00 0.875%Due:0311512018 Maturity 03/31/2018 912828045 13,W0,WODO US Treasury Note 100.000 13,W0,000.00 0.00 13,000,000.00 0.00 0.875%Due:03/31QO18 Maturity 03/3112018 912828UU2 5,000,000.00 US Treasury Note 100.000 5,W0,000.00 0.00 5,000,0W.W 0.00 0.75%Due:03131/2018 Subtotal 155,920,000.00 155,920,000.00 0.00 155,920,000.00 0.00 TOTAL DISPOSITIONS 158,920,000.00 158.92U no..00 19.541.5] 158.939.541.5] -16.49 IC& I Disclosure 2018 Chandler Asset Management, Inc,An Independent Registered Investment Adviser. Information contained herein is confidential. Prices are provided by IDC, an independent pricing source. In the event IDC does not provide a price or if the price provided is not reflective of fair market value, Chandler will obtain pricing from an alternative approved third party pricing source in accordance with our written valuation policy and procedures. Our valuation procedures are also disclosed in Item 5 of our Form ADV Part 2A. Performance results are presented gross-of-fees and represent the client's Total Return. These results include the reinvestment of dividends and other earnings. Past performance may not be indicative of future results. Therefore, no current or prospective client should assume that future performance of any specific investment or investment strategy will be profitable or equal to past performance levels. All investment strategies have the potential for profit or loss. 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This report is provided for informational purposes only and should not be construed as a specific investment or legal advice. The information contained herein was obtained from sources believed to be reliable as of the date of publication, but may become outdated or superseded at any time without notice. Any opinions or views expressed are based on current market conditions and are subject to change. This report may contain forecasts and forward-looking statements which are inherently limited and should not be relied upon as indicator of future results. Past performance is not indicative of future results. This report is not intended to constitute an offer, solicitation, recommendation or advice regarding any securities or investment strategy and should not be regarded by recipients as a substitute for the exercise of their own judgment. Fixed income investments are subject to interest, credit and market risk. Interest rate risk: the value of fixed income investments will decline as interest rates rise. Credit risk: the possibility that the borrower may not be able to repay interest and principal. Low rated bonds generally have to pay higher interest rates to attract investors willing to take on greater risk. Market risk: the bond market in general could decline due to economic conditions, especially during periods of rising interest rates. Rating Agency Comparisons A summary of investment grade ratings are listed below. More complete descriptions of Moody's and Standard & Poor's ratings are included in the following pages. Quality/Grade Mood 's Standard & Poor's Fitch Best Quality Aaa AAA AAA High Quality Aal AA+ AA+ Aa2 AA AA Aa3 AA- AA- Upper Medium Grade Al A+ A+ A2 A A A3 A- A- Medium Grade Baal BBB+ BBB+ Baa2 BBB BBB Baa3 BBB- BBB1 Moodv's - Investment Grade "Aaa" - Bonds rated Aaa are judged to be of the best quality. They carry the smallest degree of investment risk. Interest payments are protected by a large or by an exceptionally stable margin and principal is secure. While the various protective elements are likely to change, such changes as can be visualized are most unlikely to impair the fundamentally strong position of such issues. "Aa" - Bonds which are rated Aa are judged to be of high quality by all standards. Together with the Aaa group they comprise what are generally known as high grade bonds. They are rated lower than the best bonds because margins of protection may not be as large as in Aaa securities or fluctuation of protective elements may be of greater amplitude or there may be other elements present which make the long-term risks appear somewhat larger than in Aaa securities. "A" - Bonds which are rated A possess many favorable investment attributes and are to be considered as upper medium grade obligations. Factors giving security to principal and interest are considered adequate, but elements may be present which suggest a susceptibility to impairment sometime in the future. Mae" - Bonds which are rated Baa are considered as medium grade obligations; i.e., they are neither highly protected nor poorly secured. Interest payments and principal security appear adequate for the present but certain protective elements may be lacking or may be characteristically unreliable over any great length of time. Such bonds lack outstanding investment characteristics and in fact have speculative characteristics as well. Bonds in the As, A, and Bee are also assigned "1", "2", or "S' based on the strength of the issue within each category. Accordingly, "At" would be the strongest group of A securities and "AY would be the weakest A securities. Be, B, Caa, Ca, and C - Bonds that possess one of these ratings provide questionable protection of interest and principal ("Be" indicates some speculative elements; "B" indicates a general lack of characteristics of desirable investment; "Caa" represents a poor standing; "Ca" represents obligations which are speculative in a high degree; and "C" represents the lowest rated class of bonds). "Caa", "Ca" and "C" bonds may be in default. Standard and Poor's-Investment Grade AAA- Debt rated "AAA" has the highest rating assigned by S&P. Capacity to pay interest and repay principal Is extremely strong. AA - Debt rated "AA" has a very strong capacity to pay interest and repay principal and differs from the highest rated issues only in small degree. A - Debt rated "A" has a strong capacity to pay interest and repay principal although it is somewhat more susceptible to the adverse effects of changes in circumstances and economic conditions than debt in higher rated categories. BBB - Debt rated "BBB" is regarded as having an adequate capacity to pay interest and repay principal. Whereas it normally exhibits adequate protection parameters, adverse economic conditions or changing circumstances are more likely to lead to a weakened capacity to pay interest and repay principal for debt in this category than in higher rated categories. Standard and Poor's - Speculative Grade Retina Debt rated "BB", "B", "CCC", "CC" and "C" is regarded as having predominantly speculative characteristics with respect to capacity to pay interest and repay principal. "BB" indicates the least degree of speculation and "C" the highest. While such debt will likely have some quality and protective characteristics these are outweighed by major uncertainties or major exposures to adverse conditions. BB - Debt rated "BB" has less near-term vulnerability to default than other speculative issues. However, it faces major ongoing uncertainties or exposure to adverse business, financial, or economic conditions which could lead to inadequate capacity to meet timely interest and principal payments. The "BB" rating category is also used for debt subordinated to senior debt that is assigned an actual or implied "BBB" rating. B - Debt rated "B" has a greater vulnerability to default but currently has the capacity to meet interest payments and principal repayments. Adverse business, financial, or economic conditions will likely impair capacity or willingness to pay interest and repay principal. The "B" rating category is also used for debt subordinated to senior debt that is assigned an actual or implied "BB" or"BB" rating. CCC - Debt rated "CCC' has a currently identifiable vulnerability to default, and is dependent upon favorable business, financial, and economic conditions to meet timely payment of interest and repayment of principal. In the event of adverse business, financial, or economic conditions, it is not likely to have the capacity to pay interest and repay principal. The "CCC' rating category is also used for debt subordinated to senior debt that is assigned an actual or implied "B" or"B" rating. CC - The rating "CC' typically is applied to debt subordinated to senior debt that is assigned an actual or implied "CCC' debt rating. C-The rating"C'typically is applied to debt subordinated to senior debt which is assigned an actual or implied "CCC" debt rating. The "C' rating may be used to cover a situation where a bankruptcy petition has been filed, but debt service payments are continued. Cl -The rating "Cl" is reserved for income bonds on which no interest is being paid. D - Debt rated "D" is in payment default. The "D" rating category is used when interest payments or principal payments are not made on the date due even if the applicable grace period has not expired, unless S&P believes that such payments will be made during such grace period. The "D" rating also will be used upon the filing of a bankruptcy petition if debt service payments are jeopardized. Plus (+) or Minus (-) - The ratings from "AA" to "CCC' may be modified by the addition of a plus or minus sign to show relative standing within the major rating categories. NR-Indicates no rating has been requested,that there is insufficient information on which to base a rating, or that S&P does not rate a particular type of obligation as a matter of policy. FY 2017-18 Third Quarter Report This Page Intentionally Left Blank n April 30, 2018 STAFF REPORT Certificates of Participation (COP) Quarterly Report for the Period Ended March 31, 2018 Summary The District began issuing Certificates of Participation (COPs) in 1990. These COPs were a part of our long-term financing plan that included both variable interest rate and traditional fixed rate borrowing. Following are the current outstanding debt issues of the District: In May 2009, the District issued $200 million of fixed rate COPS, Series 2009A at a true interest cost of 4.72 percent for the issue. In May 2010, the District issued $80 million of fixed rate BABs, Series 2010A at a true interest cost of 3.68 percent for the issue. In December 2010, the District issued $157 million of fixed rate BABs, Series 2010C at a true interest cost of 4.11 percent for the issue. In October 2011, the District issued $147.595 million of fixed rate COPS, Series 2011A refunding a portion of the Series 2000 variable rate debt and a portion of the Series 2003 fixed rate debt. The true interest cost for the issue is 2.61 percent. In March 2012, the District issued $100.645 million of fixed rate COPS, Series 2012A refunding the Series 2003 fixed rate debt. The true interest cost for the issue is 3.54 percent. In August 2012, the District issued $66.395 million of fixed rate COPS, Series 2012E refunding the Series 2000 variable rate debt. The true interest cost for the issue is 1.50 percent. With the issuance of Series 2012B, there remains no variable interest rate COPS at the District. OCSD ♦ P.O.Box8127 ♦ Fountain Valley,CA 9272M127 ♦ (714)%2-2411 Quarterly COP Report For the Three Months Ended March 31, 2018 Page 2 of 2 In August 2014, the District issued $85.09 million of fixed rate COPS, Series 2014A, refunding a portion of Series 2007B debt. The true interest cost for the issue is 2.34 percent. In February 2015, the District issued $127.51 million of fixed rate COPS, Series 2015A, refunding $152.99 million of the Series 2007E debt. The true interest cost for the issue is 3.30 percent. In March 2016, the District issued $145.88 million of fixed rate CANS, Series 2016A, refunding $162.78 million of the Series 2009A fixed rate debt. The true interest cost for the issue is 3.02 percent. In November 2016, the District issued $109.875 million of fixed rate CANS, Series 201613, refunding the Series 2014B CANS. The true interest cost for the issue is 0.87 percent. In February 2017, the District issued $66.37 million of fixed rate COPS, Series 2017A, refunding $91.885 million of the Series 2007A debt. The true interest cost for the issue is 2.55 percent. Additional Information The graph entitled, "OCSD COP Rate History Report,' shows the various fixed interest rates of the District's thirteen debt issues. Attachments 1. Graph - OCSD COP Rate History Report Prepared by Finance,4117/2018,10:49 AM OCSD COP RATE HISTORY REPORT MARCH 2O18 5.00 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 4.00 X 3.00 w 2.00 1.00 0.00 q gg QQ DATE —8enee 2011A F'¢M —gene 2010A F'wel —Senee 2010C Flze! Sens 2011A Fimd —Sens 2012A Fed 20128 Rmd —Was 2014A FIxM S.d.a 2015A Flxed —sede52015A FdW swiss 2015e Fixed —Sed.2017A FlxW H:\depAasdMMCommon\Monthly and Quarterly Treasurer's Report\FV 17-18\COP Rate History Report FV 17-18 FY 2017-18 Third Quarter Report This Page Intentionally Left Blank 2 BAXII I p � N i� p0 NI X XE EM ORANGE COUNTY SANITATION DISTRICT FINANCIAL MANAGEMENT DIVISION 10844 Ellis Avenue Fountain Valley, California 92708-7018 714.962.2411 www.ocsd.com 3/31/18