The County treasury investment portfolio is summarized in Attachment A (Investment Summary), and includes the Treasurer's Investment Pool and the investment accounts managed by the Treasury that are not pooled together for investment returns. The pooled portfolio includes County funds, deposits from special districts, and school districts totaling $510 million as of December 31, 2018. The portfolio consisted of 4.4% ($22.3 million) in cash at bank, 47.4% ($241.9 million) in short term investments in government investment pools such as the Local Agency Investment Find (LAIF) and the California Asset Management Program (CAMP), and 48.2% ($245.6 million) in an investment pool that is actively managed by professional investment advisor PFM Asset Management, LLP (PFM). These investments consist mostly of fixed income securities as authorized by government code, such as: U.S. Treasuries; securities issued by federal agencies such as Fannie Mae, Freddie Mac and Federal Home Loan Bank; corporate notes; commercial papers; and certificates of deposit. The detail of investments in the Pooled Portfolio is shown in Attachment B (PFM Performance Report).
The non-pooled portfolio of $71.2 million consists of specific investments for various entities and programs. These include $27.6 million in government medium-term funds (LAIF and CAMP) for various districts, $31.3 million in investments managed by PFM for various county programs (Landfill Closure, Lease Revenue Bonds, etc.), $12.2 million in section 115 trusts held by PARS for County OPEB and pension purposes, and $40 thousand in cash in bank. The non-pooled investment holdings are shown in Attachment C (Non-Pooled Holdings). In their quarterly investment review for the 4th quarter of calendar year 2018, PFM believes the path of future Fed rate hikes is less clear than in recent years, they expect future tightening (additional Fed rate hikes) to be modest. Further, political gridlock adds additional uncertainty moving into calendar year 2019. As a result, PFM plans to seek to increase portfolio duration to be more in line with (neutral to) the County's benchmark.
CASH BALANCES
Attachment D (Cash Balances) depicts the cash balances of the three major operation funds of the County, and their combined balance. On December 31, 2018, this unaudited balance was $51.6 million, which increased $12.9 million from the prior quarter due to normal operating expenditures and additional revenue collection of property tax payments installments due in December.
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