Montgomery County Treasurer John McManus pointed to historic interest rate hikes from the Federal Reserve, reinvestment of county revenue, and repositioning of monies from lower interest rate streams into those earning a higher rate of return as factors that drove the fund’s growth.
“Despite coming out of COVID’s historically low interest rate environment, our team succeeded last year well beyond where we even hoped we would be by the end of the year,” said McManus in a press release.
This year, the treasurer’s office expects to earn over $17 million in interest payments for Montgomery County, more than doubling last year’s investment revenue.
The portfolio has earned about $13.6 million so far this year.
Investment portfolios managed by county treasurers, in collaboration with an investment advisory committee, are an important factor in revenue needs for county governments across Ohio, the treasurer’s office said.
State law provides Ohio counties with the ability to invest certain monies deemed inactive and held by county treasurers for investment in order to earn interest income. Most of the income earned by county investment portfolios is then directed to the county’s general fund for use.
“County treasurers are charged with managing these funds in a way that protects public dollars while also meeting the county’s expected cash needs,” said McManus.
County investment portfolios are highly regulated by state law and tightly restricted in terms of possible investment options.
Nearly three quarters of Montgomery County’s investment holdings are in bonds issued by the United States Treasury and other federal agencies. The remaining funds are divided up amongst the state’s investment pool, known as STAR Ohio, as well as select corporate bonds and municipal investments, as well as other smaller investment options.
The Montgomery County treasurer employs two full-time employees to manage the fund.
Darren Andrews, the office’s director of finance and investments, said “our investment team remains focused on optimizing returns and maintaining a diversified, well-balanced portfolio that serves the best interests of the county and its residents. We are proud of our results so far and are committed to delivering continued financial success.”
In addition to treasurer’s office staff, the office has also partnered with the financial advisory firm of Boyd Watterson Asset Management since the 1980s.
“The more money we can earn, the more Montgomery County can dedicate towards programs that help the residents of this county,” said McManus. “These earnings not only help to put Montgomery County government in a strong fiscal position, but they fund important community programs that are changing lives. I’m proud of that.”