Government continued to see returns coming in from its $138 million
investment of the sale principal of the Porter Memorial Hospital in its
third quarterly report, but they were not as impressive as the first two
From Oct. 1 to Dec.
31, the investments made a gain of $345,575, according to Amanda Black of
Capital Cities LLC, the investment advisor chosen for the Porter County
Government Nonprofit Charitable Foundation.
That is notably
lower than the previous quarter’s earnings of $4,034,315, and $1,561,660 in
the quarter before that.
The new increase
did however push the Foundation .3 percent closer to its overall goal of
earning 5 percent interest for one year of investment. The rate now is an
average of 4.7 percent.
“That is strong for
that nine-month period,” Black said at Tuesday’s Foundation meeting.
Market value of
investment ended at $151,807,705 in the Foundation’s portfolio in the
quarter ending Dec. 31.
The main reason for
“modest return” had to do with complications in the fixed income market as
the Federal Reserve raised its benchmark interest rate for the second time
in three months, Black said. There is better opportunity however for the
Foundation to earn more on cash returns.
allocation is about 60 percent in the fixed income market and 40 percent in
equity. U.S. equity returns are currently performing well and exceeding
affecting the investment market that Black mentioned include Britain’s
withdrawal from the European Union and the U.S. election of President Donald
“There are some
policies that could be favorable to markets and some that could be negative.
Everything from lower regulation and lower taxes to immigration policies,
those things could cause a wide range of effects on markets,” Black said.
Foundation continues to outpace its peer groups as it has used more flexible
fixed income strategies, Black said, and the 2017 outlook is positive for
the market as the economy keeps improving,
“It looks like we
have a pretty strong showing for an uncertain, weird time,” said County
Council member Dan Whitten, D-at large.
The County Council
and Board of Commissioners formed the Foundation about two years ago when
legislation was passed to allow Indiana counties to have more investment
options on large assets. Use of interest earned has been advocated by some
to bridge funding gaps in the County budget, while others have talked about
distributing funds to nonprofits in the county.
Any interest earned
past the rate of 5 percent is to be added to the investment amount.
presentation the board undertook housekeeping duties, electing its officers
Mike Jessen, R-4th, and Whitten were named president and vice-president of
the Foundation, respectively.
To do that, the
Foundation voted unanimously on a change to the bylaws. The bylaws had
stated that the president and vice-president had to be representatives of
different boards. Council Attorney Harold Harper said there was talk days
ago by Foundation members of having Whitten be vice-president so he prepared
an amendment that changed the requirement that the two officers be from
different boards and instead require they be of opposite political parties.
The change is so
the leaders of the Foundation can be the most qualified members.
Council member Jeff
Larson, R-at large, made the vice-chair nomination for Whitten as a sign of
confidence in him being the most knowledgeable person. Whitten, who works as
a bankruptcy attorney, had been president of the Foundation when it began.
‘One of the reasons
we drafted this is as a whole, and I don’t mean to speak for everyone else,
but for myself I would want our best foot forward. Aside from politics, the
people that have the best ability to serve in those positions should serve
in those positions,” Larson said.
Commissioner Jim Biggs, R-North, and Council member Karen Conover, R-3rd.
“I think it’s
healthy that both parties be chair and vice chair,” Biggs said.
Whitten thanked his
peers for their sentiments.
“I have certainly
taken on a mantle of this Foundation since its inception with you guys. It’s
been an interesting journey. We’ve come a long way and done some great
things together with bipartisanship and cooperation. I will continue do the
same,” he said.
The Foundation will
meet next on June 27 for a review of the investment’s complete first year
performance. It will also hire an independent firm to complete an audit as
required by statute.
A request for
proposals will go out a few weeks before the meeting and the Foundation will
conduct interviews before the meeting.
Vicki Urbanik said she and County Treasurer Michelle Clancy will have a
report that compiles information for the audit. Urbanik said it will be
“bare bones” since there has not been much movement of funds.