WATER DISTRICT EXPECTS TO GAIN $78K PER MONTH WITH NEW POLICY

A new investment strategy is expected to boost Ramona Municipal Water District’s income by $78,000 each month, with extra earnings arriving as early as February, officials said.

The district’s directors unanimously approved updates to the agency’s investment policy at their meeting Jan. 10. The policy allows staff to open accounts with the California Asset Management Program (CAMP) and the San Diego County Treasurer’s Pooled Money Fund.

Joe Spence, the water district’s CFO, recommended the options, saying the goal is to invest in very safe, liquid funds that can be easily converted to cash while taking advantage of an opportunity to capture a higher rate of return.

The district’s current investment account — the Local Agency Investment Fund — pays a roughly 2 percent rate of return, while the CAMP fund pays a 4 and a half percent rate of return, Spence said.

The rates significantly affect the district’s $37 million pool of funds available for investing, Spence said. This is not considered “extra money,” he said, but funds that are planned to be spent on operating expenses and capital improvement projects as well as reserves needed for emergencies.

The Local Agency Investment Fund had allowed the district to capture roughly $60,000 per month in income, but the gradual shift to the CAMP fund will eventually equate to roughly $138,000 in monthly income for the district, Spence said.

The Local Agency Investment Fund is a major portfolio formed in the 1970s that invests hundreds of millions of dollars using the expertise of the state Treasurer’s Office investment staff.

CAMP is a California Joint Powers Authority established in 1989 to provide state public agencies with professional investment services. The San Diego County Treasurer’s Pooled Money Fund is a local government money fund that ranges from $10.2 billion to $15.9 billion in assets annually.