Investment Report for October 2018

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 October 2018.

Total Investment Portfolio

The county’s total holdings at the end of October had a market value of $313.3-million. Excluding cash, the Treasurer’s Office has invested $252.0-million (80.4%) across a variety of fixed income security types. The total portfolio has a Yield-to-Maturity of 2.04% with an average maturity of 2.6 years.

Benchmark Performance

The Will County Treasurer’s Investment Policy sets two benchmarks against which we compare the performance of our investments.

  1. The 90-Day Average of the 1-Year Treasury Bill as quoted by the U.S. Treasury Department
  2. 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.

We see this as a temporary issue related to strong performance in short-term Treasury Bills, having increased ½-percent in the past six months. Based upon investment of the county’s levy (2.45%), we expect yield to return to position where we follow the benchmark. This remains the case when we examine county funds against the three year benchmark.

Projected Cash Flow for FY 2019

In Fiscal Year 2019, the Treasurer’s Office will maintain $248.2-million of investments which generate investment income for the county. Based upon current holdings and actual maturity, we project interest income to be $6,038,708 (2.43%) over the next 12 months. The investment income benefits corporate operation, special use funds, and income from general obligation bond proceeds.

Period Coupon Payments
December 2018 $ 417,536.84
January 2019 $ 740,699.74
February 2019 $ 572,512.13
March 2019 $ 559,631.18
April 2019 $ 683,674.03
May 2019 $ 560,004.83
June 2019 $ 288,745.73
July 2019 $ 644,802.85
August 2019 $ 373,396.37
September 2019 $ 343,490.25
October 2019 $ 504,332.26
November 2019 $ 349,582.00
Cash Flow Projection $ 6,038,708.31

County’s Levy Distribution

The Treasurer’s Office collected and distributed approximately $1.87-billion in real estate property taxes this calendar year. Will County receives a portion of the levy distribution as a taxing body itself.

As we reported in September, our office invested our target of $70-million for cash reserves. We invest in high-quality commercial bonds, municipal bonds, US Treasuries, and negotiable certificates of deposit. Over the next nine months, we will generate $1,731,872 in interest income, a yield of 2.458%.

Diversification Across Brokers

Our office awarded investments to seven (7) different brokers or bank trust departments this year.