Treasurer details county holdings, LAIF exposure and recent yields

Treasury staff presented the county’s pooled cash report and recent interest-income figures, highlighting that school funds (700 series) are major contributors to the county treasury balances and that the Local Agency Investment Fund (LAIF) holds a substantial portion of county cash.

The report indicated almost $40,000,000 in LAIF and that Chandler manages roughly $8,000,000 of county treasury money. Staff described an accounting reclassification tied to the Markleyville Creek Restoration funding (about $1,600,000 moved into its own fund after auditors requested segregation of those monies). Chandler’s representative reported an average purchase yield of 4.04% for the portfolio and an average market yield near 4.35% as of Aug. 31; Chandler’s longer-duration holdings move differently than short-term LAIF holdings in a rising-rate environment.

The treasurer emphasized that school revenues are not budgeted in the county general fund and that some special funds (for example, the Tamarack Fire Recovery Fund) include insurance recoveries and advance funds from Cal OES. Committee members discussed how the inverted yield curve over the past years had made short-term products outperform longer-duration holdings but noted that trend may be shifting as rates rise.

Staff and Chandler recommended retaining designated cash for liquidity while balancing short- and longer-term allocations to capture higher yields without sacrificing required liquidity.