Steamboat Springs If the financial markets have the typical investor's stomach tied in knots, consider Jeanne Whiddon's situation she's charged with managing a $31.5 million portfolio.
Fortunately, or perhaps unfortunately, for Whiddon, it's not her money. It's your money.
As Routt County treasurer, a part of Whiddon's statutory obligation is to safely invest the county's portfolio.
The $31.5 million essentially represents Routt County's general fund. County government is continually spending the money, but it's essential to manage it for a return in the meantime. Not to worry, Whiddon isn't day trading with the county's money she couldn't if she wanted to.
"We have a responsibility to the public that we really take seriously," Whiddon said. "We don't just go for the highest yield. First we take safety into account, then liquidity and third, we look at yield."
State law limits Whiddon to investing in conservative, safe investments. Her tendency is to maintain a portfolio that is even one level more conservative than what the government requires, she said.
During 1999, Whiddon's first year in office, she enlisted the help of other county officials in creating a written county investment policy for the first time. In addition, a local oversight committee, including finance director Dan Strnad, one of the three county commissioners and County Attorney John Merrill, reviews county investments regularly.
Additionally, the county retains a firm called MBIAA to help manage its portfolio and choose investments.
"MBIAA checks on our compliance with state statutes on a daily basis," Whiddon said.
MBIAA also helps Strnad continually evaluate the portfolio to manage liquidity so the county's cash flow needs are met. It's a balancing act between realizing a return and ensuring the cash will be there when it's needed.
For the six months that concluded in June, the county's annualized return on investments was 2.85 percent.
"I used to get 5.5 to 7 percent," Whiddon said. "Now I'm lucky to get 3 percent."
Of the total, about $17 million is in cash and "equivalents" including money market accounts and two government pools that permit liquidity on a 24-hour notice. There is also $1.5 million in certificates of deposit, spread amongst every bank in Routt County. About $5 million is invested in U.S. Treasury notes.
Another big chunk is invested in instruments backed by the federal government like Fannie Mae and Freddie Mac real estate funds.