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Board hears bond-proceeds investment strategy and adopts investment policy CDA resolution
Summary
The board received an economic and portfolio update from Hilltop Asset Management on investing bond proceeds and adopted investment policy CDA. Hilltop recommended a conservative laddered approach to lock in interest and preserve liquidity; the district reported it expects to earn roughly $18 million from bond proceeds under the current strategy.
The Mesquite ISD Board of Trustees on Sept. 16 received an update from Hilltop Asset Management on economic conditions, the Federal Reserve outlook and the district’s strategy for investing recent bond proceeds, and voted to adopt the district’s investment policy (CDA) resolution.
Scott McIntyre, Hilltop’s senior portfolio manager, briefed trustees on macroeconomic indicators, noting slowing job growth, inflation trends and market expectations for Federal Reserve rate cuts. He said the district’s approach for the $100 million in bond proceeds was to keep a portion highly liquid for near-term construction draws and to ladder larger blocks of U.S. Treasuries and short-duration investments aligned to the expected draw schedule through August 2028. The firm described the strategy as conservative and designed to lock in yield while preserving liquidity in an uncertain rate environment.
Hilltop estimated the district could earn roughly $18 million from invested bond proceeds under the current plan, while stressing that forecasts depend on Fed action and market changes. The presentation noted the majority of investments would be U.S. Treasury securities and that agency yields and other market segments were less attractive at the time of the briefing.
Following the presentation, trustees voted to adopt the investment policy CDA resolution as presented. The board’s business staff emphasized that no substantive changes to the district’s CDA language were proposed and that the resolution aligns policy language with current practice for posting and oversight of investment activity.
Why it matters: How bond proceeds are invested affects the interest income available for the district’s capital program and the timing of funds available for construction draws. A conservative laddering approach seeks to balance yield and liquidity given uncertain near-term interest-rate paths.
Discussion versus decision: The Hilltop presentation was informational; the formal board action adopted the district’s investment policy CDA resolution. The board received no new or changed authority other than adopting the policy resolution.
What’s next: The district will implement the investment allocations described; staff will bring routine updates on earnings and liquidity as construction draws are made.
