CASH FLOWS & INVESTMENT STRATEGY Conestoga Valley School District

Cash Flow Projections

Monthly Summary of Cash Receipts, Disbursements

Permissible Investments US Treasury Bills – 1 year or less Obligations of US Agencies – 1 year or less  FHLB, FFCB, FNMA, FHLMC, SLMA Obligations of US Government backed by full faith & credit – short-term or long-term  GNMA (collateralized mortgage obligations) CDs insured by FDIC - $250,000 C0llateralized CDs  102% Market Value Collateral (US Treasury/ Agency Securities only), or Federal Home Loan Bank Irrevocable Letter of Credit

Bank Failures 2000 through 2007 total of 27 bank failures 2008 – 25 bank failures 2009 – 140 bank failures 2010 – 157 bank failures YTD 2011 – 51 bank failures Total since 2000 = 400 bank failures

20 Year History of T-Bill Interest Rates

Current Interest Rates US Treasury Bills – 0.13% Agencies – 0.16% FDIC Individual Bank CDs – 0.25% % Collateralized CDs – 0.20% % Minimal increase in interest rates is projected for

Current Portfolio

CV’s Investment Strategy FDIC Insured CDs – properly rated Collateralized CDs Agencies such as FHLB, FNMA, FHLMC US Treasury Bills if interest rates increase Investment term within 12 months unless rates increase If rates increase, invest longer term with staggering maturities, i.e. 12 month, 15 month, 18 month, 24 month maturities