ADMINISTRATION & FINANCE COMMITTEE Thursday, February 15, 2018 12:00 PM VTA Conference Room B-106 3331 North First Street San Jose, CA AGENDA CALL TO ORDER 1. ROLL CALL 2. PUBLIC PRESENTATIONS: This portion of the agenda is reserved for persons desiring to address the Committee on any matter not on the agenda. Speakers are limited to 2 minutes. The law does not permit Committee action or extended discussion on any item not on the agenda except under special circumstances. If Committee action is requested, the matter can be placed on a subsequent agenda. All statements that require a response will be referred to staff for reply in writing. 3. ORDERS OF THE DAY CONSENT AGENDA 4. ACTION ITEM - Approve the Regular Meeting Minutes of January 18, 2018. REGULAR AGENDA 5. ACTION ITEM -Recommend that the VTA Board of Directors review and accept the Fiscal Year 2018 Statement of Revenues and Expenses for the period ending December 31, 2017. 6. ACTION ITEM -Recommend that the VTA Board of Directors authorize the General Manager to execute a sole source contract with Dellner Inc., in an amount up to $1,795,738 to procure the components needed for the overhaul of 173 couplers on VTA’s fleet of Light Rail Vehicles.
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ADMINISTRATION & FINANCE COMMITTEE
Thursday, February 15, 2018
12:00 PM
VTA Conference Room B-106
3331 North First Street
San Jose, CA
AGENDA
CALL TO ORDER
1. ROLL CALL
2. PUBLIC PRESENTATIONS:
This portion of the agenda is reserved for persons desiring to address the Committee on
any matter not on the agenda. Speakers are limited to 2 minutes. The law does not
permit Committee action or extended discussion on any item not on the agenda except
under special circumstances. If Committee action is requested, the matter can be placed
on a subsequent agenda. All statements that require a response will be referred to staff
for reply in writing.
3. ORDERS OF THE DAY
CONSENT AGENDA
4. ACTION ITEM - Approve the Regular Meeting Minutes of January 18, 2018.
REGULAR AGENDA
5. ACTION ITEM -Recommend that the VTA Board of Directors review and accept the
Fiscal Year 2018 Statement of Revenues and Expenses for the period ending December
31, 2017.
6. ACTION ITEM -Recommend that the VTA Board of Directors authorize the General
Manager to execute a sole source contract with Dellner Inc., in an amount up to
$1,795,738 to procure the components needed for the overhaul of 173 couplers on VTA’s
fleet of Light Rail Vehicles.
Santa Clara Valley Transportation Authority
Administration & Finance Committee February 15, 2018
Page 2
7. ACTION ITEM -Recommend that the VTA Board of Directors authorize the General
Manager to amend the Rail Rehabilitation (Phase 6) and Crossovers & Interlockings
Contract (C16189F) with DMZ Transit (Joint Venture) by an amount of $1,100,000 for
additional signal work, increasing the total contract amount to $9,713,750.
8. ACTION ITEM -Recommend that the VTA Board of Directors authorize the General
Manager to issue competitive developer Request for Proposals (RFP) for Joint
Development (JD) at the Blossom Hill, Ohlone/Chynoweth, and Curtner JD sites,
consistent with VTA’s Joint Development Policy.
9. INFORMATION ITEM -Receive information on future framework for replacement
parking policy.
10. INFORMATION ITEM -Receive the Monthly Investment Report December 2017.
Receive presentations on Actuarial Assumed Discount Rate & implications and
VTA/ATU Pension Plan Portfolio.
11. INFORMATION ITEM -Receive an update on the Metropolitan Transportation
Commission (MTC) Means-Based Fare Study.
OTHER ITEMS
12. Items of Concern and Referral to Administration.
13. Review Committee Work Plan. (Srinath)
14. Committee Staff Report. (Srinath)
15. Chairperson's Report. (O'Neill)
16. Determine Consent Agenda for the March 1, 2018 Board of Directors Meeting.
17. ANNOUNCEMENTS
18. ADJOURN
In accordance with the Americans with Disabilities Act (ADA) and Title VI of the Civil Rights
Act of 1964, VTA will make reasonable arrangements to ensure meaningful access to its
meetings for persons who have disabilities and for persons with limited English proficiency who
need translation and interpretation services. Individuals requiring ADA accommodations should
notify the Board Secretary’s Office at least 48-hours prior to the meeting. Individuals requiring
language assistance should notify the Board Secretary’s Office at least 72-hours prior to the
meeting. The Board Secretary may be contacted at (408) 321-5680 or
10 Transfer From/(To) Operating Balance (20,454) (20,454) (1,578)
11 Ending Operating Reserves 46,205 46,205 65,081
12 Operating Reserve %3 9.4% 9.4% 13.2%
Note: Totals may not be precise due to independent rounding.
1 Adopted Budget approved by the Board on June 1, 2017 2 Staff Projection as of January 23, 2018 3 Line 11 divided by subsequent fiscal year budgeted Operating Expenses
5.a
Date: February 8, 2018
Current Meeting: February 15, 2018
Board Meeting: March 1, 2018
BOARD MEMORANDUM
TO: Santa Clara Valley Transportation Authority
Administration & Finance Committee
THROUGH: General Manager, Nuria I. Fernandez
FROM: Chief Operating Officer, Inez Evans
SUBJECT: Light Rail Coupler Parts Contract
Policy-Related Action: No Government Code Section 84308 Applies: Yes
ACTION ITEM
RECOMMENDATION:
Recommend that the VTA Board of Directors authorize the General Manager to execute a sole
source contract with Dellner Inc., in an amount up to $1,795,738 to procure the components
needed for the overhaul of 173 couplers on VTA’s fleet of Light Rail Vehicles.
BACKGROUND:
VTA owns, operates and maintains a fleet of 99 Light Rail Vehicles (LRVs) manufactured by the
Kinkisharyo Corporation in 2001. The LRVs consist of mechanical, electrical and pneumatic
coupler assemblies (hereinafter, “couplers”) at each end of the LRV that were originally
manufactured by Dellner, Inc. Including spare coupler units, VTA has 208 couplers. VTA has
determined that the couplers, which are in excess of 15 years old, have reached their mid-life
stage and are in need of a complete overhaul and refurbishment, including preventative
replacement of certain components and replacement or refurbishment of parts that may show
damage or excessive wear. The coupler overhaul program seeks to bring the coupler back to like-
new manufacturer specifications and functional performance.
As part of this refurbishment and overhaul, various parts, hardware, and components will be
disassembled, inspected, tested, reassembled, function tested and quality assurance verified as a
complete coupler assembly ready to be installed onto a VTA LRV. VTA has already procured
the necessary parts for the overhaul of 35 of the 208 couplers. This contract is for parts and
fasteners required to overhaul the remaining 173 of VTA’s 208 couplers.
The coupler components in this contract include bearings, and other specialized components that
are only available through Dellner, Inc., the Original Equipment Manufacturer (OEM) of the
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coupler. The coupler is considered a safety-critical component, and purchase of the coupler
components from the OEM is the best course of action to ensure compatibility, reliability and
safety.
DISCUSSION:
The overhaul program is required to protect the large investment VTA has made in the light rail
vehicles so that VTA may continue to provide safe and reliable transportation to our patrons.
VTA is also required to have a comprehensive maintenance program as directed by the
California Public Utilities Commission (CPUC).
All light rail transit systems in the State of California are required to operate their LRVs in
properly maintained and safe working condition as documented in the systems' approved
operating rules and procedures, which includes processes for mid-life rehabilitation of the LRV
fleet. The couplers are included in the mid-life overhaul rehabilitation program.
VTA has adopted the manufacturer’s recommended maintenance program into its internal
procedures. Replacing the key components of the LRV’s coupler system ensures that these
vehicles will operate in optimal condition for the remaining years of their expected useful lives.
Many of the coupler components specified in this contract are manufactured to order. As such,
the lead time from procurement to product delivery may be many months. It is therefore crucial
that this contract is executed in a timely manner to minimize lead times.
ALTERNATIVES:
As these parts are only available through Dellner, Inc., there are no practical alternatives to
purchasing these components from another vendor.
SMALL BUSINESS ENTERPRISE (SBE) PARTICIPATION:
Based on the limited scope of work and no subcontracting opportunities, no specific goal has
been established by the Office of Business Diversity Programs for this contract. Contractor is
encouraged to make reasonable efforts to meet VTA’s SBE overall annual goal of 19 percent in
its procurement of ancillary services and products associated with the performance of this
contract.
FISCAL IMPACT:
This action will authorize up to $1,795,738 to procure parts and fasteners for the coupler
overhaul. Appropriation for this contract is included in the FY18-FY19 Adopted VTA Transit
Fund Operating Budget.
Prepared by: Daniel Hecht
Memo No. 6397
ATTACHMENTS:
6397 - LR Coupler Parts - Gov Code 84308 (PDF)
6
Attachment A
Light Rail Coupler Parts Contract Procurement List of Contractors
Firm Name Name Role Location
Dellner, Inc. Jeron Cain President 8334-H Arrowridge Blvd.
Charlotte, NC 28273
6.a
Date: February 8, 2018
Current Meeting: February 15, 2018
Board Meeting: March 1, 2018
BOARD MEMORANDUM
TO: Santa Clara Valley Transportation Authority
Administration & Finance Committee
THROUGH: General Manager, Nuria I. Fernandez
FROM: Chief Engineering & Program Delivery Officer, Carolyn M. Gonot
SUBJECT: Amend the Rail Rehabilitation (Phase 6) and Crossovers & Interlockings
Contract (C16189F)
Policy-Related Action: No Government Code Section 84308 Applies: Yes
ACTION ITEM
RECOMMENDATION:
Recommend that the VTA Board of Directors authorize the General Manager to amend the Rail
Rehabilitation (Phase 6) and Crossovers & Interlockings Contract (C16189F) with DMZ Transit
(Joint Venture) by an amount of $1,100,000 for additional signal work, increasing the total contract
amount to $9,713,750.
BACKGROUND:
On February 2, 2017, the VTA Board of Directors authorized execution of a contract with DMZ
Transit (Joint Venture) in the amount of $6,891,000 for the construction of the Rail Rehabilitation
(Phase 6) and Crossovers & Interlockings Contract (C16189F). See Exhibit A for a list of sub-
contractors on the DMZ Transit Team.
This contract is part of an ongoing capital rail replacement, rehabilitation, maintenance and
improvement program to ensure that the light rail track infrastructure remains safe and reliable
for continued service. The scope includes track replacement, construction of crossovers, and
installation of related equipment at various locations, including switch machines and signaling
work.
DISCUSSION:
With the expected opening of BART to Berryessa this summer, VTA staff has updated the light
rail operating plan showing increased service to meet the anticipated increased ridership
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demands from BART and the implementation of the Next Network. This plan includes
significant service changes on the Tasman East light rail segment with decreased headways and
increased capacity, especially during event service with the BART connection at the Montague
light rail platform. This operating plan results in the need to increase capacity by performing
specific light rail track improvements prior to the opening of the new BART service.
Two of the most critical improvements needed to increase capacity are;
1. Upgrade the existing signal system on the aerial structure to Automatic Block Signaling
(ABS) to facilitate train movements through the area of congestion and eliminate the
current chokepoint at that location.
2. Upgrade an existing manual switch at Hostetter to automatic power switch to allow more
flexibility for turning trains around and other train movements.
This work is highly specialized and the improvements need to be completed and operational by
mid-June 2018. The DMZ (JV) team is qualified and has the appropriate specialties to perform
this work, in particular the signaling expertise of the joint venture. The team is currently
performing very similar work on the VTA light rail system through this contract and is already
mobilized with the resources to complete this work in time for the BART opening.
The following table summarizes the original and proposed contract terms. For information, the
amounts provided fully utilize the original contract contingency.
SUBJECT: Joint Development Developer RFP’s for San Jose Signature Review Sites
Policy-Related Action: No Government Code Section 84308 Applies: No
ACTION ITEM
RECOMMENDATION:
Recommend that the VTA Board of Directors authorize the General Manager to issue
competitive developer Request for Proposals (RFP) for Joint Development (JD) at the Blossom
Hill, Ohlone/Chynoweth, and Curtner JD sites, consistent with VTA’s Joint Development Policy.
BACKGROUND:
The Blossom Hill, Ohlone/Chynoweth and Curtner JD sites are located in the City of San Jose, within General Plan-designated Urban Villages. The General Plan places them in Horizon 2, which has an undetermined timeframe for implementation. The City of San Jose allows for expedited development of sites within Urban Village Plans through its Signature Review process, and the City’s Planning Department has provided VTA with information on requirements for these sites to be eligible for Signature Review. This would involve an increased amount of ground floor commercial uses to meet the minimum square footage identified by the City, in return the City would allow residential units for the creation of a mixed-use project.
Attachment A details the location of Blossom Hill, Ohlone/Chynoweth and Curtner JD sites in the region and the local area. These sites were originally acquired and constructed to serve as Park and Ride lots for the Guadalupe Corridor project. The Ohlone/Chynoweth Station includes VTA’s first Joint Development Project, done through a long-term ground lease with Eden Housing, Inc. for 194 affordable housing units.
Both Blossom Hill and Curtner Park and Ride lots are significantly underutilized, while the Ohlone/Chynoweth Park and Ride lot has a moderate level of transit rider usage. VTA Staff (staff) will identify and propose Transportation Demand Management strategies for any future JD projects.
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DISCUSSION:
Staff held a series of community meetings in January 2018 for each location to hear from the neighborhood on its future vision for the site. Overall, public feedback was positive toward the idea of TOD in their neighborhoods. Many attendees desire improvements to station access to address safety concerns. Other general items of concern included parking, way finding, and nearby homeless activity. Staff also contacted the City Council member’s office for each of the three sites to discuss the site and potential opportunities and challenges for a JD project.
The developer RFP’s will state that VTA seeks to enter into a long-term ground lease, with payments based on the fair market value of the site. Developers will design, finance, build and operate a Transit-Oriented Development (TOD) consistent with the City of San Jose’s Envision 2040 General Plan and Signature Review/Urban Village Plan framework. The RFP’s will require that any residential use must provide that at least 20 percent of residential units be affordable units, pursuant to VTA’s Affordable Housing Policy set forth in the Joint Development Policy.
The RFP’s would be issued through the spring and summer of 2018 to facilitate marketing the opportunities to the largest potential pool of market-rate and affordable housing developers.
Staff will evaluate RFP submittals and submit a recommendation to the Board of Directors for an Exclusive Negotiations Agreement (ENA) for each site. Staff will then work with the selected developer for each site, the local community, and the City to refine the proposed project to maximize its benefits. This would include the final size of the JD project, its location and site plan, and how the project would support current transit usage and future ridership growth.
The selected developers would be responsible for taking the lead in working with the local community and obtaining final entitlements from the City of San Jose, subject to VTA approval of the application to the City and the final project. Compared to prior JD projects, staff is not seeking to obtain full entitlements prior to RFP issuance and instead intends to use the developer’s expertise in obtaining entitlements. This approach is expected to facilitate more efficient and direct engagement with all parties, and shorten the overall entitlement timeline as well as potentially reduce entitlement costs.
ALTERNATIVES:
The Board could provide additional guidance for RFP’s requirements, or identify another timeframe to issuance of the RFP’s.
FISCAL IMPACT:
Expenses associated with issuance of an RFP will be paid from the Joint Development Fund.
Based on the current fair market value of land in the area, a future JD project pursuant to a
ground lease would be expected to generate substantial new annual revenues.
Prepared by: Ron Golem
Memo No. 6291
ATTACHMENTS:
Memo 6291 Attachment A (PDF)
8
Attachment A
CURTNER
OHLONE/CHYNOWETH
BLOSSOM
HILL
8.a
Blossom Hill:
Curtner:
8.a
Ohlone/Chynoweth:
8.a
Date: January 29, 2018
Current Meeting: February 15, 2018
Board Meeting: N/A
BOARD MEMORANDUM
TO: Santa Clara Valley Transportation Authority
Administration & Finance Committee
THROUGH: General Manager, Nuria I. Fernandez
FROM: Chief Financial Officer, Raj Srinath
SUBJECT: Formulation of a Joint Development Replacement Parking Policy
FOR INFORMATION ONLY
BACKGROUND:
VTA’s Joint Development (JD) Portfolio contains 25 properties that the VTA Board has
designated as priority sites for Transit-Oriented Development (TOD) projects with the goal of
generating revenues, increasing ridership, and catalyzing transit-oriented communities. All of
these sites, except for two, consist of Park and Ride lots, and it is envisioned that JD projects
would be built on a portion of each of these lots, consistent with local plans and zoning.
Parking is a significantly underutilized resource at VTA. VTA has a total of 7,525 parking stalls
located at JD Park and Ride lots. Less than 3,800 of those spaces are actively used as of October
2017. (Attachment A contains a breakdown by station.).
Transit agency experience throughout the US has shown that the cost of 100% replacement of
parking spaces used for JD projects is one of the largest impediments to the feasibility of JD
projects, with the potential to prevent projects and eliminate revenue generation.
Previous committee discussions have highlighted the need for further evaluation of how to create
optimal JD projects that reduce the need for replacement parking, while at the same time
ensuring that VTA maintains sufficient parking to accommodate current and future transit riders.
This includes ensuring that VTA can accommodate future desired growth in rail transit riders.
A VTA replacement parking policy would provide guidance for County residents, local agencies,
developers, transportation planners, and others on how to best manage the dual objectives of
creating JD projects, including affordable housing, while supporting future ridership growth.
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DISCUSSION:
Staff, working with a multi-disciplinary development and transportation planning consultant
team has conducted research to assess both opportunities and constraints to developing JD sites
on a portfolio wide and individual site basis. This includes evaluation of current and future
parking demand and supply. Parking demand is dynamic, and varies by station location, as well
as transit service (e.g. stations where there is both VTA light rail and Caltrain service). Riders of
commuter shuttles are increasingly utilizing VTA Park and Ride lots, which is a consideration
pursuant to the Commuter Shuttle Policy recently adopted by the Board of Directors.
Given these considerations, any replacement parking policy should provide flexibility to
accommodate unique conditions on a site-by-site basis, while at the same time establishing a
consistent process for evaluating parking demand and the parking supply that need to be
provided for transit riders and residents and workers in JD projects.
Another consideration is a generational and cultural shift already underway in individual car
usage, and the impact of Transportation Network Companies (Uber, Lyft, etc.); car sharing
services; and increased uses of other modes of transportation. For example, garage operators in
San Francisco report a decrease of 10% to 25% in parking demand over the past few years due to
these factors.
Research on other agency practices for JD replacement parking and Transportation Demand
Management (TDM), including BART; Portland TriMet; LA Metro; Washington, DC WMATA;
and King County, WA Metro has highlighted a range of best practices and strategies for
replacement parking. These include:
Developing clear station access goals and priorities for all modes of transportation
Shared parking for use by transit riders and occupants of JD projects;
Use of paid parking and parking pricing to shift demand;
Coordination with Transportation Network Company (TNC’s) and car share solutions to
address first and last mile challenges;
Station specific analysis, coordinated with local jurisdictions, to address the specific
station area context, transit ridership goals, and provide cost-benefit analysis;
Encouragement of no parking minimums by local jurisdictions; and
Replacement parking standards established on a site by site basis, with evaluation of
ridership gains from JD projects as well as excess parking capacity, to determine project-
specific replacement parking requirements.
The chart on the following page summarizes how various agencies use different replacement
parking and TDM tools:
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Page 3 of 3
Agencies
Def
ined
Acc
ess
Pri
ori
ties
Sh
are
d P
ark
ing
Paid
Park
ing
TN
C C
oord
inati
on
Loca
l Ju
risd
icti
on
Coord
inati
on
No P
ark
ing
Min
imu
ms
(Ju
risd
icti
on
s)
Sit
e b
y S
ite
Rev
iew
BART
TriMet
LA METRO
WMATA
King County Metro
Staff will provide a presentation at the meeting that provides additional examples and insight into
considerations related to replacement parking, TDM, and provision of parking to meet future
transit needs. Some of the topics for discussion could include:
Station area access priorities (pedestrian, bicycle, carpool, private vehicle, etc.);
Framework for analyzing tradeoffs between JD replacement parking and transit ridership;
Considerations for implementation of paid parking; and
Other policy or local factors that will need to be addressed.
Discussion with the Advisory Committees will be used to inform and shape staff’s preparation of
a draft JD replacement parking policy to be added to VTA’s Joint Development Policy. Such a
draft policy would be presented as an action item to the Advisory and Standing Committees prior
to final consideration by the Board of Directors.
Prepared By: Ron Golem & Jessie O'Malley Solis
Memo No. 6406
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ATTACHMENT A:
PARK & RIDE UTILIZATION
Joint Development Portfolio
Park and Ride Lot Usage October 20171 Station Stalls Occupied Stalls
Almaden 189 37
Alum Rock 110 97
Berryessa/N. San Jose BART Not in Service Not in Service
Blossom Hill 511 220
Branham 271 52
Capitol 951 205
Cerone N/A N/A
Cottle 421 237
Curtner 474 80
Evelyn n/a n/a
Gilroy * 471 282
Hostetter 100 81
Alder 275 92
VTA Block n/a n/a
Milpitas Transit Center (new) Not in Service Not in Service
Morgan Hill* 486 328
Ohlone 549 517
River Oaks N/A N/A
Diridon N/A N/A
San Martin* 167 84
Santa Clara* 321 305
Santa Teresa 1155 251
Snell 430 112
Tamien** 644 771
Total 7,525 3,751
1. Light Rail Park and Ride Lots Usage (Operations, Oct. 2017) * Caltrain Station
**Caltrain and Light Rail Station
Note: limited additional parking surveys indicate that parking by riders of commuter shuttles usage is a factor at some VTA Park and Ride lots. For example, 10% of the occupied parking at Tamien Station is utilized by commuter shuttle riders; at Ohlone/Chynoweth commuter shuttle riders represent approximately 30% of Park and Ride lot usage.
9.a
Date: January 30, 2018
Current Meeting: February 15, 2018
Board Meeting: N/A
BOARD MEMORANDUM
TO: Santa Clara Valley Transportation Authority
Administration & Finance Committee
THROUGH: General Manager, Nuria I. Fernandez
FROM: Chief Financial Officer, Raj Srinath
SUBJECT: Monthly Investment Report - December 2017
FOR INFORMATION ONLY
BACKGROUND:
The investment activities of the Santa Clara Valley Transportation Authority are in compliance
with the Investment of Non-Trust Held Funds Investment Policy, the VTA Retirees’ Other Post-
Employment Benefits Trust Investment Policy and the ATU, Local 265 Pension Plan’s
Investment Policy.
DISCUSSION:
Real gross domestic product (GDP) increased at an annual rate of 2.6 percent in the fourth
quarter of 2017, according to the "advance" estimate released by the Bureau of Economic
Analysis. The increase in real GDP in the fourth quarter reflected positive contributions from
personal consumption expenditures (PCE), nonresidential fixed investment, exports, residential
fixed investment, state, local and federal government spending. In the third quarter, real GDP
increased 3.2 percent.
Headline consumer prices, as measured by the consumer price index (CPI), rose 2.1% year over
year as of December 2017. Core CPI, which excludes volatile food and energy prices increased
at a rate of 1.8% year over year as of December 2017. The Federal Reserve continues to target an
inflation rate of 2.00%.
The unemployment rate in the San Jose-Sunnyvale-Santa Clara MSA was 2.7% in December
2017, unchanged from a revised 2.7% in November 2017, and below the year-ago estimate of
3.4%. This compares with an unadjusted unemployment rate of 4.2% for California and 3.9% for
the nation during the same period.
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Market Watch
The S&P 500 Index returned 1.11% in December 2017. Large cap stocks returned 1.11% and
small cap stocks returned -0.41%. Within the large cap space, growth stocks underperformed
value stocks, returning 0.78% and 1.44%, respectively. The top-performing sectors were
consumer discretionary, energy, and materials & processing. The worst-performing sectors were
technology, health care and utilities.
The Barclays Aggregate index returned 0.46% in December 2017. The current month investment
grade corporate debt returned 0.90% and agency mortgage backed debt returned 0.30%.
In global markets, the United States 10 year government bond yield ended the month at 2.41%,
unchanged from November. The European 10 year government bond yield ended the month at
0.43% and the Japanese 10 year government bond yield finished December at 0.05%.
VTA Enterprise Funds
VTA Enterprise Funds are invested in portfolios managed by Payden & Rygel, the State of
California Local Agency Investment Fund (LAIF) and an interest bearing checking account.
Investment performance for the Payden & Rygel managed accounts are included below.
The Payden & Rygel weighted average composite portfolio outperformed its policy benchmark
in December by 0.04%. The current yield for the Payden long-term portfolio is 1.86%, the mid-
term portfolio is 1.68%, and the short-term portfolio is 1.57%.
At month-end the current yield for funds invested in LAIF was 1.24% and the VTA’s checking
accounts was 0.55%.
Market performance for each Payden & Rygel account is summarized in the following table:
Investment Performance as of December 2017
Asset Class Fund Manager Dec 3 Mo Y-T-D 1 Yr 3 Yr 5 Yr 10 Yr I-T-D
5 Funded April 1, 2009. Prior manager was Brandywine with the same benchmark. 6 Funded December 14, 2007. Prior managers were Putnam and Fidelity with MSCI EAFE as their benchmark. 7 Initially funded June 30, 2016 8 Initially funded July 1, 2010. UBS Realty Investors LLC with NCREIF NFI-ODCE as their benchmark. Report 45 days after quarter ended. 9 Funded January 28, 2016
10 Investment performances by prior managers are included in composite returns and historical policy benchmark returns.
DODGE & COX - The Fixed Income portfolio manager underperformed its benchmark in
December 2017 by 0.04%. The portfolios’ lower exposure to long-term bonds (10+ years) is the
main detractor from relative performance for the month.
BOSTON PARTNERS - The Domestic Large Cap Value Equity manager outperformed its
policy benchmark in December 2017 by 0.60%. Stock selection in the energy and financial
sectors both contributed to outperformance for the month.
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WEDGE - The Domestic Small Cap Value Equity manager outperformed its policy benchmark
in December 2017 by 0.20%. Stock selection in the finance sector and particularly in the bank
and insurance subsectors contributed to the relative outperformance for the month.
MFS - The International Equity manager underperformed its policy benchmark in December
2017 by 0.19%. Stock selection within the basic materials and healthcare sectors both
contributed to the relative underperformance for the month.
LIGHTHOUSE - The Absolute Return manager underperformed its policy benchmark in
December 2017 by 0.30%. Quantitative strategies were the primary driver of relative
underperformance for the month.
SKYBRIDGE - The Absolute Return manager outperformed its policy benchmark by 0.11% in
December 2017. Relative value, event driven and structured credit strategies all contributed to
outperformance for the month.
A 7.00% rate of return assumption is used in the annual actuarial analysis for the ATU Pension
Plan. The results of the actuarial analysis determine VTA’s annual contribution rates. The
annual returns for the ATU Pension Plan portfolio have been equivalent to or exceeded the
7.00% assumed rate of return 11 out of 15 years.
Historic Portfolio Performance (calendar year) for the last fifteen calendar years:
Year Performance Year Performance Year Performance
2003 21.5% 2008 -19.7% 2013 16.5%
2004 12.2% 2009 25.7% 2014 7.2%
2005 7.2% 2010 14.0% 2015 0.5%
2006 14.5% 2011 1.7% 2016 9.2%
2007 5.8% 2012 14.5% 2017 14.65%
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ATU Spousal Medical Trust Fund, Dental, and Vision Plan
Asset allocation for the ATU Spousal Medical Trust Fund (including funds for dental and vision
plans) is provided for in the SCVTA-ATU Pension Plan Investment Policy.
Asset Allocation Range Target Actual
Domestic Fixed Income 30-50% 38% 31%
Domestic Large Cap Index 50-70% 60% 65%
Cash 0-5% 2% 4%
The ATU Spousal Medical Trust Fund composite portfolio outperformed its policy benchmark in
the current month by 0.03%. The current yield for the fixed income portfolio is 3.80% and the
current effective duration is 4.20 years.
Market performance for each money manager is summarized in the following table:
Investment Performance as of November 2017
Asset Class Fund Manager Nov 3 Mo Y-T-D 1 Yr 3 Yr 5 Yr 10 Yr I-T-D