Commissioners find private‑placement purchases violated county investment policy; issue written findings

The Delaware County Board of Commissioners on March 6, 2025 confirmed a semiannual review of county investment procedures for the period July 1–Dec. 31, 2024 and issued written findings that at least three private‑placement bond purchases violated county policy requiring unanimous approval by the investment advisory committee.

Barb Lewis, president of the Delaware County Board of Commissioners, read the policy language adopted by the investment advisory committee in May 2023 including Section 5(b): “The treasurer shall not purchase directly by private placement any bonds or other obligations of political subdivisions or other public entities unless prior to the purchase the investment advisory committee approves and authorizes the purchase by a unanimous vote of the full membership of the investment advisory committee.” The board said a separate opinion from the county prosecutor supports the amendment and its enforceability.

Members reviewing the county portfolio said private‑placement bonds carry higher risks than securities traded in a public market because they are typically illiquid, often unrated and can carry longer maturities. Reviewers noted four principal risks to monitor: liquidity, credit risk, interest‑rate risk and concentration risk. The review cited examples in the portfolio including bonds purchased in earlier years at fixed low rates (one example cited at 1.75% for 10 years) and a private placement identified as “BSTNG” purchased in mid‑2024 that was not presented to or approved by the investment advisory committee.

The committee’s written findings say the purchases were “clearly in violation” of the amended policy and that remedial steps—such as reversal of the transactions, sale of the investment or committee review—had not been taken. Commissioners said the policy does not prohibit private placements but requires committee sign‑off to ensure risks are considered and priced.

The board approved Resolution 25‑175 to confirm the semiannual review and issue the written findings. The motion carried by unanimous recorded vote (Jeff Benton Aye; Gary Merrill Aye; Barb Lewis Aye). The board directed staff to publish the findings and indicated the matter will require ongoing oversight to ensure the committee’s approval process is followed.

No formal corrective action (sale or reversal) was recorded on the meeting minutes; the resolution documents the findings and requires follow up by county staff.