This report examines the performance of the public funds currently invested by the Will County Treasurer’s Office. This narrative covers investment activity and performance in June 2011.

Corporate Class C Fund

The Corporate Class C Fund is the principal operating account for the county. The Treasurer’s Office uses this fund to pay employees, vendors, and other operating liabilities.

As of June 30, 2011, Corporate Class C Fund had a total balance of $128,776,306. Of this total, we have invested 50.1% in certificates, commercial paper, CDARs, and municipal bonds ($64.5-million).

The Treasurer’s Office purchased $17.2-million worth of investments for the Corporate Class C Fund in June. We purchased these investments using money from the county’s portion of the real estate levy as well as cash on hand.

As we discussed in May, our investment strategy focuses on building an investment ladder to fund the county’s payroll. We have built the ladder through the end of March 2012 as of this report.

From the chart below, you can see that the majority of Corporate Class C Funds will mature within six to nine months. This duration correlates with the investment ladder we have built so far. Our target is to see a portfolio maturity of about 270 days. As of June 30, 2011, it was 211 days (γ=0.78).

Treasurer’s Class C Fund

The Treasurer’s Class C Fund is the county’s capital improvements fund. The Treasurer’s Office holds proceeds from the county and township motor fuel tax, statutory proceeds, automation funds, and other department revenue.

As of June 30, 2011, Treasurer’s Class C had a total balance of $157,579,952. Of this total, we invested 30.2 % in certificates, CDARs, and commercial paper ($47.6-million).

At the end of June, the Treasurer’s Office sold a $10-million security at a premium, earning the county more interest than if we held the investment to maturity. As a result, our cash position increased. Our over-concentration in cash is a temporary condition, as we will invest approximately $85-million during the month of July.

In our May report, we discussed our goal to keep at least 85% of our fund invested in a mixture of treasury and agency bonds, certificates, and short-term commercial obligations. We are prepared to pay the expenses related to Highway Department construction this summer and will reserve cash for this purpose.

Benchmark Tests

The Will County Treasurer’s Investment Policy sets two benchmarks to which we will compare investment performance:

  1. The 3-month average of the 90-day Treasury Bill as quoted by Bloomberg LP
  2. The Money Funds Report of all taxable 7-day simple yield as reported on www.IMoneyNet.com

As of July 1, 2011, both the Corporate Class C Fund and Treasurer’s Class C Fund exceed our policy benchmarks. The funds also exceed informal benchmarks against the 12-Month Treasury and 52-Week CDAR. We continue to improve fund performance by investing some of our money at longer durations.

As of July 1, 2011 Corporate Class C Treasurer’s Class C
7-Day Net Simple 0.0200 % 0.2853 % (Exceed) 0.3563 % (Exceed)
90-Day Treasury Bill 0.0200 % 0.2853 % (Exceed) 0.3563 % (Exceed)
12-Month Treasury 0.1900 % 0.2853 % (Exceed) 0.3563 % (Exceed)
52-Week CDAR 0.2700 % 0.2853 % (Exceed) 0.3563 % (Exceed)

Summary

The Treasurer’s Office continues to rebalance our two main public fund pools in order to capture higher yield while keeping money safe and liquid. As tax collection slows during July, our office will focus on investing our large cash position in the Treasurer’s Class C Fund.

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