Klamath County finance staff warn liquidity has dropped as LGIP rates fall

County finance staff told the Klamath County Board of Commissioners on Nov. 25 that the county’s liquidity has declined significantly over the last year and that investment earnings are likely to fall as LGIP yields drop.

“Anything that matures over the next few months, we’re going to liquefy and put it into the LGIP,” the finance presenter said, explaining the county moved money into the Local Government Investment Pool this year to cover obligations. The presenter added the county would not change its investment policy this year.

The presentation cited recent LGIP rate movements — down from about 4.5% earlier in the year to roughly 4.25% at the time of the meeting — and an allocation shift toward U.S. Treasury and agency securities with few municipal bonds in the portfolio. The presenter also pointed commissioners to the fiduciary net position of the county investment pool and reported a loss in the pool of $7,347,002.96 for the fiscal year.

Staff said they keep a target liquidity cushion of about $33,000,000 across bank accounts and that the investment core balance has fallen from prior levels (presenter cited roughly $163 million previously to about $155.8 million in the fiscal year). Commissioners and staff noted the drop is consistent with spending exceeding revenues in 2025.

The presenter invited commissioners to request further detail by email or follow-up meetings; no changes to policy or formal motions on investment strategy were adopted at the session.

The board approved prior meeting minutes earlier in the session and adjourned the finance meeting at 2:58 p.m.