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CITY OF LINO LAKES, MINNESOTA <br />NOTES TO FINANCIAL STATEMENTS <br />December 31, 2005 <br />Note 2 DEPOSITS AND INVESTMENTS (CONTINUED) <br />The Minnesota Municipal Money Market Fund Trust is a common law trust organized in <br />accordance with the Minnesota Joint Powers Act, which invests only in investment instruments <br />allowable under Minnesota statutes as described on the previous page. Its investments are valued <br />at amortized cost, which approximates fair value in accordance with Rule 2a -7 of the Investment <br />Company Act of 1940. The amortized cost method of valuation values a security at its cost on the <br />date of purchase and thereafter assumes a constant amortization to maturity of any discount or <br />premium, regardless of the impact of fluctuating interest rates on the market value of instruments. <br />Credit Risk — The Minnesota Municipal Money Market Trust Fund does not have its own credit <br />rating. MBIA, Inc., who administers the Minnesota Municipal Money Market Fund Trust holds an <br />organization credit rating of Aa2. <br />Concentration of Credit Risk. <br />The City places no limit on the amount that it may invest in any one issuer. The following is a list <br />of investments which individually comprise more than 5 percent of the City's total investments: <br />Type Amount Percentage <br />Federal Home Loan Bank $ 6,254,544 22.88% <br />Federal National Mortgage Association 3,046,531 11.14% <br />General Electric Capital Commercial Paper 6,363,903 23.28% <br />Rhineland Funding Commercial Paper 5,034,315 18.42% <br />43 <br />