Kodiak invests $10 million and uses transfers to shrink $1.7 million General Fund shortfall

The City of Kodiak moved $10 million into Treasury bills, agency securities and corporate bonds in August, according to the City Council's Oct. 8 work session packet. The packet also shows the city needed about $1.6 million in transfers to cut a $1.7 million General Fund shortfall for the year to about $95,000.

The investments are projected to earn 4.22 percent if held to maturity. That's 0.59 to 0.82 percentage points more than the city's liquid accounts at Wells Fargo and at AMLIP, an investment pool run through the Alaska Municipal League.

An analysis by the firm Three+One, using its cashVest cash-management tool, found the city's managed investments grew from $38.5 million to $48.5 million. That raised the firm's score for Kodiak one point, to 91. Kodiak held about $110.6 million in cash and investments as of Aug. 31, and the firm says another $33.5 million could be invested while leaving about $27.5 million in high-yield accounts. The report notes the city lacks a citywide investment policy and urges adopting one.

Finance Director Julie Liew's unaudited report for the year ended June 30 shows $1.1 million of the transfers came from Enhancement Fund earnings above what inflation-proofing required, and $480,000 from unused project money. State fish tax revenue and community revenue sharing both came in lower than expected.

The council is scheduled to review both reports Thursday at 5:30 pm.