Consider action on approval of the Quarterly Investment Report for the period ending June 30, 2026

Staff Report & Agenda Item Details

The Quarterly Investment Report for the period ending June 30, 2026 is attached for Council review and approval.  <br><br>The City is required to comply with Chapter 2256 of the Government Code, otherwise known as the Public Funds Investment Act. Provisions of that act require quarterly reporting, at a minimum.  The accompanying Quarterly Investment Report lists, in summary form and in detail, the investment position of the City of Watauga's investment portfolios as of June 30, 2026.  The overall strategy of running the City’s investment portfolios is governed by the City’s Investment Policy and overseen by the City’s investment committee.  All investments are governed by state law and the City’s Investment Policy, which dictates the following investment objectives, in order of priority:<br><br>Safety of Principal<br>Liquidity<br>Return on Investments<br><br>As of June 30, 2026, the City held money market accounts and investments with a combined book value of $57,626,936.  The City's fund portfolio consists of operating funds, construction funds, and debt service funds. The City’s portfolio has averaged a yield of 3.82% for the third quarter of Fiscal Year 2026 and investment earnings for the quarter were $553,125.  The Federal Open Market Committee (FOMC) kept the Fed Funds target range at 3.50% - 3.75%.  There are no expectations for rate cuts through 2026.  The City Portfolio distribution is 6% in Certificates of Deposit, 58% in money market accounts, and 36% in pooled investment accounts.    <br><br>The investment committee reviewed the Quarterly Investment Report.  The Committee finds the report to be in compliance with the Public Funds Investment Act and recommends that the City Council receive and accept the report, as presented.

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