The Vanderburgh County Council held a special meeting on the 25th day of August, 1999 in room 301 of the Civic Center Complex. The meeting was called to order at 3:25 p.m. by County Council President Curt Wortman.

President Wortman: The Vanderburgh County Council is now in session for the special meeting August 25th at 3:15, a little late, 3:25. All Councilmembers have a highlighted copy of the ordinance being considered. The public hearing for this ordinance will be held September 1st which is next Wednesday at our regular County Council meeting. The Treasurer should be present for any questions. Now this is the first reading today and next will be the final reading, September 1st. So I will open the meeting with attendance on the roll call please, Madam Secretary.
 

(Councilmember Sutton arrived shortly after roll call)

President Wortman: Okay, would everybody stand and pledge allegiance to the flag please?

(Pledge of Allegiance was given)
 

ORDINANCE AUTHORIZING AND APPROVING THE INVESTMENT OF PUBLIC FUNDS IN MONEY MARKET MUTUAL FUNDS

President Wortman: Okay, the business here now is the ordinance authorizing and approving the investment of public funds in money market mutual funds. This is a first reading and I'll entertain a motion and a second and then we'll have discussion because the County Treasurer is here. 

Councilmember Hoy: So moved for passage.

Councilmember Lloyd: Second.

President Wortman: Mr. Hoy makes a motion and Mr. Lloyd seconded it. Any discussion? Mrs. Jayne Berry-Bland, would you step forward please with your name and where you are from.

Jayne Berry-Bland: Jayne Berry-Bland, Vanderburgh County Treasurer. I apologize for being late. I was told 3:15 but I thought they misunderstood. There has been a little bit of mixup on this, I think. I think today was just the first reading and I think the questions, hopefully, will come next week. I have made arrangements for a professional person from a bank to come and explain plus answer any questions next week, so I am hoping that it can be held off as far as questions. But the basic idea of this is to earn the county more interest, of course. And what it is, it's strictly backed by the government, which I think you all are aware that that's the only way we can do investments. It just gives me a little more room to make investments not knowing when we are going to need the money. In other words, if I make an investment for 30 days but we need the money in ten days, they won't penalize me. I will still draw the interest on however many days I had that money sitting there.

President Wortman: Yeah, if the way I read it and understand it, you can only invest 50 percent of your holdings thats available to invest and say, normally what is a figure would you throw out say, are we talking $10,000,000 or $5,000,000?

Jayne Berry-Bland: Not at all nearly that much, Mr. Wortman. Most of the time, I try to keep as much invested, I think you can see on my investment reports, I do try to give us some leeway anywhere between $100,000 to $400,000 that I have sitting there in the bank and we certainly would want to draw more like five percent than the two and a half that we're drawing now on it.

President Wortman: You're only drawing two and a half?

Jayne Berry-Bland: Yeah. It's a sweep account. It's under our cash management contract and prior to this cash management, we drew absolutely zero. So governments, they always treat us differently it seems like on everything we go to do. And the banking industry, what had happened all these years were, we would get free accounts but we never drew any interest on the money sitting there. Well, you well know that the Auditor may write checks on Friday but they actually may not be mailed or even sent out until maybe the following Monday that they all would get mailed, so it kind of gives that leeway that we don't have to have all that money sitting there in the bank waiting for payments to be made. We can go ahead and invest it and if we run short or something big would come up that we need to pay, we can pull that money out and get it and not lose any of the interest. 

President Wortman: Yeah, that gives you flexibility and you won't be penalized. Now how much guarantee or risk, whatever words you want to use, is there when investing in a money market mutual fund, which is not the stock market type thing.

Jayne Berry-Bland: I am glad you pointed that out. There is absolutely no risk. Any time you're dealing with government funds, it has to be backed by the U. S. Government. So the only mutual funds that we actually are going to be able to invest in are something that you may be familiar with, it's something like a Fannie Mae, some of those types of things that are strictly backed by the government. There is zero risk in these types of investments.

President Wortman: Okay, now the state legislators passed this law, is that correct?

Jayne Berry-Bland: Yes, and what it means is, all 92 counties are going to be able to pool their money together and get a better interest rate because the amount is going to be so much more than individual counties trying to invest their money, that we should be able to get a better interest rate also on that money. 

President Wortman: Now, would you do purchases more so twice a year after you receive tax money, is that very apt to happen more so than any other time of year?

Jayne Berry-Bland: Well, it's -- in the law, I think they've kind of avoided during the heavy tax time, they're not going to hold me to that 50 percent. But honestly, I think more, I would probably invest in more throughout the year than right at that time because I normally take that money every day and so something with it when we're collecting in our heavy season.

President Wortman: And you anticipate possibly five percent, maybe? Is that a possibility?

Jayne Berry-Bland: I would think so.

President Wortman: Would you go through a bank broker?

Jayne Berry-Bland: Something is better -- you know, an increase is -- something is better than nothing. And you know, until we do this for about a year, it's really difficult to estimate what revenues this is going to generate in addition to what we already do. 

President Wortman: How would you go about this now? Are you going to go through a broker in a bank or how are you going to --

Jayne Berry-Bland: We do have to go through a bank because our county is one of only a handful that is involved in a cash management system with the bank, so we will be dealing with a bank.

President Wortman: Okay, fine. Now anybody else got any questions? Mr. Lloyd?

Councilmember Lloyd: Was this law effective this year?

Jayne Berry-Bland: Yes sir.

Councilmember Lloyd: And then what you're mainly talking about is like cash on hand that is very short term because you would probably invest some of this money in like longer term?

Jayne Berry-Bland: Exactly, and the Auditor's Office tries to keep me very well informed on the particular funds. It primarily would be General Fund money because most of the other funds, we try to keep a pretty good handle on and talk to the parties that are involved and invest it accordingly to how we think the payout is going to go, especially on the larger projects like the Burkhardt construction.

Councilmember Lloyd: Right.

Jayne Berry-Bland: We have done that over almost like a year two period. The investments just kind of keep coming in at different times, anticipating payments, and sometimes we haven't had to pay, so I take that money and just reinvest it back. So on the actual funds we try to keep a pretty close hand on those. It would be more the General Fund money that we're not quite sure from week to week what is going to go out.

Councilmember Lloyd: Okay.

President Wortman: Let me ask you this -- would bridge money, Local Roads & Streets, all that, it takes effect, too?

Jayne Berry-Bland: Yes. Any of it can be invested this way. If I have $100,000 sitting in bridge money, we don't have to leave that sitting there in bridge money. We can invest it for 20 days or 30 days or whatever we think it will be before we have to make another payment. And it will mean probably a lot of work as far as keeping in touch with everyone and trying to keep the money invested just every day that we possibly can.

President Wortman: That's fine. You'll have a full time job here maybe. Okay, anybody else?

Councilmember Lloyd: So you had indicated right now that this money is like in a sweep account where the bank sweeps it out and you're getting about two and a half percent?

Jayne Berry-Bland: Yes, it's pretty minimal.

Councilmember Lloyd: Yeah, one thing, talking about these money market funds, they'll offer higher rates, maybe the banks will look at giving you a better rate, too, to keep the money.

Jayne Berry-Bland: I know the last time I spoke up here, I think, in regards to this I made some comment about yes, I hope the interest rates go up and everybody is going, oh my goodness! I am one of the few, but simply for the county, because we have dealt the last couple of years with a pretty low interest rate. So I think anything that we can do to make a few more dollars, we need to look at. So we have been trying to get this law passed, the Treasurers' Association, for several years, and it took a while because the local banks are afraid that it's going to take business away from them. Well, certainly we do want to do business with our local banks, but we also want to look out for the county and if we can make more money elsewhere doing it some other way, then that's what we want to do. But I do still have to do these investments with the designated depositories that are set by the state of Indiana. 

Councilmember Lloyd: So the state has to approve the depository?

Jayne Berry-Bland: And they already have. They approve those depositories once a year.

President Wortman: Yeah, I can recall, I think, 15 years ago where interest rates was getting the Treasurer 15 percent, I believe. One time I believe it was 17, if I recall. And I wanted to put everything in there, but they didn't want to.

Jayne Berry-Bland: That's right.

Councilmember Lloyd: Well, and I talked to a banker today, and they said rates are going up or the Federal Reserve raised one of their rates yesterday, so yeah, you may be getting a better return here shortly. 

Jayne Berry-Bland: Right, we've already seen that one improvement where they just raised them recently, so we are getting a little over five percent now on our investments.

President Wortman: Any other Councilmen have any questions?

Councilmember Lloyd: I can just offer a comment. Reading the law, they limit it to they have to be rated AAA or better which pretty well is very safe and if you recall, Orange County, California was the one that got into a tremendous amount of problems because they were investing in really junk bond stuff and it ended up costing the county millions of dollars.

Jayne Berry-Bland: We also had a Treasurer here in Indiana that did the same thing a couple of years ago.

Councilmember Lloyd: So I think it looks like the law was written to try to avoid that kind of a problem.

Jayne Berry-Bland: Right.

President Wortman: Okay, well, our local banker is here now. Mr. Sutton, would you have any questions for our Treasurer about investments here on the money market mutual fund? 

Jayne Berry-Bland: I did explain that I will have a banking person that actually deals with this on a day to day basis and is very familiar with this law to be here for the second reading and when you really ask probably the more detailed questions and I am sure that they will be able to answer questions much better than myself. 

Councilmember Sutton: Well, because I am running behind it wouldn't be fair for me to ask a litany of questions. I will get with her since we aren't taking final action today. So I will get a chance to talk with you, Jayne.

President Wortman: Yeah, the final reading, hearing, will be next Wednesday at the regular Council meeting, see. And this is just a preliminary. Remember, we postponed it last month because she was told she could go on vacation, see. 

Jayne Berry-Bland: Well, and I was told that it would just be the first reading and I didn't need to be here. So there was some kind of a miscommunication and I apologize very much for that.

President Wortman: You was told that. Okay, if there isn't any other discussion, why I think we will excuse you --

Jayne Berry-Bland: Thank you.

President Wortman: Let's see, I guess we'd better call for a vote, that's right. Almost forgot that, so call the roll please, all those in favor of this ordinance authorizing approval of the investment of public funds in money market mutual funds.

Teri Lukeman: Councilmember Smith?

Councilmember Smith: Yes.

Teri Lukeman: Councilmember Sutton?

Councilmember Sutton: Yes.

Teri Lukeman: Councilmember Bassemier?

Councilmember Bassemier: Yes.

Teri Lukeman: Councilmember Hoy?

Councilmember Hoy: Yes.

Teri Lukeman: Councilmember Raben?

Councilmember Lloyd: Yes...Councilmember Lloyd. Yes.

Teri Lukeman: President Wortman?

President Wortman: Yes. 

(Motion unanimously approved 6-0)

President Wortman: Okay, thank you. If there's no other business on this short meeting, I am going to adjourn this meeting and we'll start in to the next meeting. Meeting is adjourned.

Meeting adjourned at 3:37 pm.
 
 

_____________________________ ____________________________
President Curt Wortman                         Vice President Russell Lloyd, Jr.
 

_____________________________ ____________________________
Councilmember James Raben              Councilmember Phil Hoy

_____________________________ ____________________________
Councilmember Ed Bassemier             Councilmember Royce Sutton
 

______________________________
Councilmember Betty Knight-Smith
 
 

Recorded and transcribed by Teri Lukeman