Kodiak moves $10 million of city cash into bonds and Treasury bills

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

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

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, raising the firm's score for Kodiak one point to 91. The firm says another $33.5 million could be invested while leaving about $27.5 million in high-yield accounts. Kodiak held about $110.6 million in cash and investments as of Aug. 31. 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.