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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 July 2015.
Total Investment Portfolio
The county’s total holdings at the end of July had a market value of $235.5-million. The Treasurer’s Office has invested $171.4-million (72.7%) across a variety of fixed income security types (excluding cash). The total portfolio (including cash) has a Yield-to-Maturity of 96.6 basis points with an average maturity of 1,401 days (3.8 years).
The Treasurer’s Office will collect and distribute approximately $1.72-billion in real estate property taxes this calendar year. As a taxing body itself, Will County also will receive property taxes. The Treasurer’s Office will invest approximately $70-million of the county’s levy in order to have a cash reserve during non-levy collection months between December and next May.
To date, the Treasurer’s Office has invested $35-million into a structured “ladder” where funds mature every two weeks to coincide with payroll and accounts payable operations. The investments are high-quality commercial paper, commercial bonds, and municipal bonds.
Our objective for these investments is to earn ½-percent more interest than the Six Months Treasury Bill, which would be about 55 basis points, or 0.55%. We currently are above our goal at 63 basis points.
For the past 24 months, the Will County Treasurer’s Investment Policy sets two benchmarks against which we compare the performance of our investments.
- The 90-Day Average of the 1-Year Jumbo Deposit National Rate as quoted by the FDIC
- The 90-Day Average of the 3-Year Treasury Note as quoted by the U.S. Treasury Department
We use these two benchmarks because they closely relate to the length of time we hold an investment.
Maturity is the period of time for which an investment remains outstanding. Upon maturity, the bond issuer will pay back the full amount, plus any applicable interest to the county. This is how our office makes money for the county through our investment activities.
The Treasurer’s Office looks at the maturity of an investment with great interest because it must match our cash flow needs in order to pay outstanding bills and obligations. We invest operating cash into instruments with maturities of less than one year. Any money not needed to pay obligations within 12 months will be invested in longer term investments up to 10 years. The average maturity of our portfolio is 1,401 days (3.8 years) as of this report.