Get Full Government Meeting Transcripts, Videos, & Alerts Forever!
Get email alerts on the Municipal Finance topic
No spam. Unsubscribe anytime.
Town hears LGIP briefing; staff say Kiawah holds about $53 million in state pool
Summary
Mike Addy, director of investments for the state LGIP, told the Kiawah Island Town Council that the pool is $15.6 billion in market value, produced a 2025 net return of 4.56% (about 19 basis points above its benchmark) and that Kiawah has roughly $53 million in the pool. Council asked about credit standards, guideline compliance and a possible longer-duration fund.
Mike Addy, director of investments, briefed the council on the state Local Government Investment Pool (LGIP) and the fund's structure, holdings and recent performance. The LGIP, created by the general assembly in 1983, allows local governments to pool cash to improve returns and preserve liquidity while keeping participant account operations on an iPass portal.
Addy said the pool's market value was about $15.6 billion as of the day before the meeting and that the March distribution to the entire pool was about $57.7 million. He told council staff told him Kiawah Island has approximately $53,000,000 invested in the LGIP. He described the pool's investment priorities as preservation of capital, liquidity and obtaining a reasonable return, in that order.
The LGIP uses a range of short-term instruments, Addy said, including U.S. Treasury bills, federal agency securities, municipal bonds, certificates of deposit, overnight repurchase agreements and commercial paper. He reported the pool's weighted-average maturity is shorter than policy limits (about 73'74 days versus a 90-day cap), and that through May the portfolio was approximately 45% commercial paper, 25% CDs, about 19% asset-backed commercial paper, roughly 5% short corporate bonds and about 4% overnight repos; government securities were about 1.8% of the portfolio.
On performance, Addy said the LGIP's 2025 net return was 4.56% compared with a 4.35% benchmark, roughly a 19-basis-point outperformance year-to-date. A council member noted that beating a money-market benchmark by that margin is unusually strong in the category.
Council members asked about credit quality and operational controls. Addy said the investment policy (IPS/CIP) requires top-tier credit (a weighted average at least A-1/P-1), limits corporate maturities to under 397 days and mandates at least 10% daily liquidity. He said LGIP managers implement maturity targets in consultation with state staff, and that LGIP had no guideline violations in the past year.
Addy said staff are researching a possible longer-duration product (roughly a two- to three-year vehicle) to accommodate participants with longer-term capital needs, but he warned about structural risks (for example, a small number of participants pulling large balances could affect yield for remaining participants) and said any new product would require careful structural rules such as minimum terms and possible penalties for early withdrawal.
The council thanked Addy for the briefing and did not take any formal action on the pool. Addy said he would share additional policy documents with the council upon request.
