Travis County Commissioners Court
July 29, 2008
Item 4
Number 4 is to consider and take appropriate action on order amending chapter 23, investment policy and procedures, of the Travis County code.
>> good morning. Mary mays, asset investment management. I have with with me crystal burton, our senior financial analyst. I'm here to present to you the annual review of the investment policy as required by law. And I do have some recommendations for changes. The first one is that I would like for you to approve investment authority for our senior financial analysts. Over the past several years our portfolio size has almost doubled, and now that we have three pools that takes additional time for the cash management. Crystal's education is excellent. She's working on an mba now. And she's is been here with us for about a year. So she's very qualified and we need her. My second recommendation is to extend the weighted average maturity of the operating vest fort foaleio. Currently and for years and years it has been 365 days, and I would recommend that we extend it to 547 days, which would be approximately 18 months. There are several reasons for this. One is that the operating portfolio contains a reserve, and those reserves do not ordinarily get spent during the year like some of our other funds do. So they can be invested further out. And we have the unallocated reserves, the health management reserve. So all of those represent funds that can be invested longer than one year. In addition I keep error of what our core portfolio is. And the core portfolio is the amount that you get bound to at the lowest point in -- that you get down to at the lowest point in the year. So that could have been invested longer also. And since the year 2000 our core portfolio in operating has increased from 84 million to 224 million. So we've had a big increase there also. And I did do a survey of the five largest urban counties to see what they do. And basically two of them have no portfolio limits at all in their weighted average maturity, but they have above maturity for their investments. The other do have limits, but they have longer limits for other funds. For instance, they don't have their reserves in the operating portfolio and they do have longer limits for their reserves. So we would still be very conservative compared to those. To those other counties. Any questions on that one?
>> do we think we would be able to get the auditor certified additional revenue if we take this action?
>> well, I certainly hope so because it would involve additional revenue. That's part of the reason obviously for doing it. So then the other one, the next one would be to increase the maximum maturity allowed for treasuries and for agencies. We have restrictions on how long they could be. Right now treasuries are at five years, and I'm asking that they be extended to seven years so that I could go out seven years on treasuries. And agencies are restricted to five-year maturities -- to three-year maturities, and I'm asking that we need to go out to five years for that. And this will be would be about 30 basis points right now that we could increase the yield, whenever the yield curve is normal you get more yield the further out you go. And that would represent, oh, say, $30,000 a year on a 10-million-dollar investment. So -- and that would go along with the other requests. And finally, this one is very much a no brainer, but I just gave it to you yesterday. So let me mention that we would make changes in the policy so that we would follow the changes in the public funds investment act, and that would be to change from saying that buying a certificate of deposit from a bank that was dock saled in the -- that was domiciled in the Texas. It now says that as long as that bank has a branch in the state of Texas. So that's what we'd be changing in the policy. Any other questions?
>> judge, I would move approval of all of the recommendations.
>> second.
>> any discussion of the motion? All in favor? Show Commissioners Gomez, Daugherty and yours truly voting in favor. Commissioner Davis abstaining.
>> thank you.
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Last Modified:
Tuesday, July 29, 2008 2:51 PM