Cash & Investments Policy Recommendation

Finance CommitteeJanuary 28, 2014

Overview of discussion

• NC municipal survey

• Governance • NC General Statutes• Local Government Commission

(LGC)

• Policy objectives

Other NC Cities

Cash & Investments Policy

UnitYes, has

formal policy No formal policyCary X Concord X Wilmington X Charlotte XWilson XWinston-Salem X Greenville X

Governance

§ NCGS 159-30

A local government may deposit at interest or invest all or part of the cash balance of any fund.

The investment program shall be so managed that investments and deposits can be converted into cash when needed.

Governance

LGC Policy Manual for local government cash & investments

Objectives of investment activity

Safety - preservation of capital

Liquidity - available when needed

Yield - maximize return subject to othe priorities

Local - invest with local banks, when appropriate

Diversification - balanced portfolio

Priority

Safety

High risk

investments are

not allowed

Safety - preservation of capital

Liquidity - available when needed

Yield - maximize return subject to othe priorities

Local - invest with local banks, when appropriate

Diversification - balanced portfolio

Priority

Liquidity

$15 million of

approximately

$100 million

available to pay

recurring bills

Safety - preservation of capital

Liquidity - available when needed

Yield - maximize return subject to othe priorities

Local - invest with local banks, when appropriate

Diversification - balanced portfolio

Priority

Yield

Challenging in

current rate

environment

Safety - preservation of capital

Liquidity - available when needed

Yield - maximize return subject to othe priorities

Local - invest with local banks, when appropriate

Diversification - balanced portfolio

Priority

Diversification and local investment($ millions)

$4.5

$16.5

$8.6

$7.6

$11.2 $17.5

$0.3

$34.1 CD's

Comm Paper

Fed Farm Credit

Fed Home Loan Bank

Fed Home Loan Mort

Fed National Mort

US Treasury

Liquid funds

* At June 30, 2013