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 August 2012.

Total Investment Portfolio

The county’s total holdings at the end of August had a market value of $335.8-million, an increase of $6-million from July. The office invested $5-million of property tax levy distributions and reserved $5-million in our Money Market holdings.

The Treasurer’s Office has invested $190.2-million (58.4%) across a variety of fixed income security types. The total portfolio has a Yield-to-Maturity of 71.9 basis points (0.719 %) with an average maturity of 1,214 days (3.3 years).

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 August 31, 2012, the market value of the Corporate Class C Fund was $138.8-million, an increase of $5.9-million from June. Excluding cash, yield in the Corporate Class C Fund was 80.2 basis points.

Our office has invested $64.8-million of the county’s property tax distribution as of this report. These investments will mature beginning in December and provide a consistent revenue stream through the end of May 2013. The total levy investment has a yield of 87.5 basis points (0.875%), which is greater than our goal of beating the Six Month U.S. Treasury by ½-percent.

This is the second year for using a “ladder” structure in our investment portfolio, and it has greatly improved our ability to manage the county’s cash requirements. When Treasurer Weber entered office in December 2010, the county’s investment portfolio had no predictability for when individual investments matured. Today, we have a predictable amount of money maturing to cover expenses.

Our office will have approximately $20-million in “excess” levy funds once active collection ends. We define “excess” as money not needed for our investment ladder during non-collection. It does not mean that the county has more money than is necessary to operate.

In September, we will ask our banking partners to propose a managed investment product for a maximum of $10-million in the Corporate Class C Fund. We envision the investment to have an average maturity between three and five years, and be in addition to $25-million that Fifth Third Asset Management currently manages in a similar assignment.

By placing a total of $35-million in intermediate-term investments, the Treasurer’s Office will replicate the budgetary reserves maintained by the County’s Finance Department.

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, automation funds, and other revenue.

As of August 31, 2012, the market value of the Treasurer’s Class C Fund was $196.9-million, unchanged month-over-month. Excluding cash, yield in the Treasurer’s Class C Fund was 3.22%.

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 September 4, 2012, 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. The yields reported for Benchmark Tests include cash holdings.

September 4, 2012 Corporate Class C Treasurer’s Class C
7-Day Net Simple 0.0200 % 0.8020 % (Exceed) 1.5030 % (Exceed)
90-Day Treasury Bill 0.1000 % 0.8020 % (Exceed) 1.5030 % (Exceed)
12-Month Treasury 0.1600 % 0.8020 % (Exceed) 1.5030 % (Exceed)
52-Week CDAR 0.2500 % 0.8020 % (Exceed) 1.5030 % (Exceed)
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