Butler’s city investment account raises $1.5 million in first 7 months
Butler may have bit off a lot of projects this year, but it doesn’t seem to be more than the city can chew.
City Council learned during its forum meeting Thursday, Oct. 9, that the city’s $32.5 million investment account with NexTier Wealth Management had grown by $1.5 million since February — a 4.47% increase.
Council also voted unanimously to approve four motions to help pay off some of the city’s debt service and making first payments toward three ongoing projects.
Thursday’s payments, which totaled over $600,000, included $225,000 to the county for debt service for the 2019 Butler County Infrastructure Loan; $100,000 to Troy Jay Construction for the Farmers’ Market project; nearly $200,000 to Hiles Excavating for the parking lot improvement project as well as $90,000 for the Father Marinaro Park project.
The payment on the infrastructure loan was due Nov. 1, but Councilman Don Shearer said it is one of the city’s debts council is looking to erase in the near future. The initial infrastructure loan was for just over $1 million.
The payments represent a portion of total costs, with parking expected to cost around $650,000, Father Marino Park to cost $388,000 and the farmers’ market to cost $515,000 out of pocket.
Each project was outlined in the city’s long-range plan for the legacy fund — the $90 million received from the sale of Butler Area Sewer Authority.
About $15 million of the fund was set aside in a five-year long-range plan for immediate needs, $50 million was placed into a trust with PNC, and the remaining $25 million was placed in an investment account with NexTier Bank.
Since the amount will be spent over time, $7.5 million of the $15 million allocated for the long-range plan also was placed in the investment account, raising the total to $32.5 million.
At Thursday’s meeting, Tony Pratt and Will Baker from NexTier Wealth Management gave City Council an update on the investment account. The funds are invested entirely in U.S. Treasury and U.S. government agency bonds.
As of Sept. 30, they said the account now holds almost $1.5 million more than it did when it was deposited in February.
“So, you are getting better than money market rates, you can’t expect to get a whole lot more than that. These are U.S. Treasuries, mostly. So there’s nothing rough. We’re not buying any stocks or anything like that,” Pratt said.
According to the representatives, the investment portfolio, now worth just under $34 million, is expected to produce an additional $1.2 million over the next 12 months.
Representatives from PNC, who oversee the $50 million legacy trust, are expected to present at city council’s next meeting at 7 p.m. Oct. 23.
