Flathead County Treasurer Adele Krantz had two words to describe the latest quarterly report on the county’s investments: “Not great.”

The interest rate on the short-term investment pool run by the state has continued to erode and stands now at just .29 percent. The county pulled its money from that investment pool in early 2010 when the interest rate than had dropped to an unprecedented .31 percent, and hasn’t tapped into it since. The pool’s interest rate has gone as low as .25 percent, Krantz said.

By comparison, the county was making 5.5 percent five years ago — pre-recession — on its pooled short-term investments.

Interest earned from the county’s sweep account was $71,573 for the first quarter of fiscal year 2013, which ended Sept. 30. That’s the account in which the county takes all the excess available money at the close of each business day and invests it in overnight interest-bearing instruments such as money-market mutual funds or repurchase agreements.

The sweep interest rates have slipped, too, from 5.57 percent in late 2007 to 1.25 percent in the first fiscal quarter of 2010 to .35 percent for the first quarter of fiscal 2013.

The top investment for the latest quarter was a 1.4 percent interest certificate of deposit provided by Goldman Sachs through LPL Financial. 

The county began purchasing certificates of deposit through brokers in July, Krantz told the county commissioners on Monday.

“We’ve been actively seeking these,” she said. “A bright spot was our ability to do that.”

From July through September the county purchased 13 CDs, each for the maximum $250,000, for a total of $3.25 million.

The county currently has just over $120 million in investments and distributed $58,261 in interest for the quarter ending Sept. 30.

During fiscal 2012 the county’s investments averaged just over $127 million, with average monthly interest distributions of $91,379. By comparison, during fiscal year 2009, investments averaged $102 million, with average monthly interest distributions of about $228,600.

Krantz invests money from the county, local school districts and other districts, such as fire and rural special-improvement districts, in a variety of short- and long-term funds, then distributes the interest back to those entities.

A local governing body may invest public money not necessary for immediate use in a limited number of eligible securities, including U.S. Treasury bills and agencies such as the Federal Home Loan Bank, Federal National Mortgage Association (Fannie Mae), the Federal Home Loan Mortgage Corporation (Freddie Mac) and Federal Farm Credit Bank.

County money also is deposited in local financial institutions, but the county requires those institutions to “pledge” or secure the investments. 

IN OTHER business, Krantz said the county sent out 57,842 tax notices last week for $142.7 million in property taxes due.

Flathead County currently had $2.8 million in protested taxes as of Sept. 30, but delinquent taxes are at $1.4 million, a 1 percent rate, Krantz said.

“I don’t think I have seen it that low,” she said.

The low delinquent tax rate likely is connected with a recent mass mailing sent to delinquent Flathead County property taxpayers by several private entities such as the Montana Land Project. Those letters explained the recipient had two weeks to pay their back taxes or the company would pay them instead, which, the letter stipulated, “COULD RESULT IN THE LOSS OF YOUR PROPERTY.”

Many companies purchase liens mainly for the interest, Krantz said. Of the 2,300 notices sent to property owners by two companies in July, the companies ended up purchasing only 377 of those liens.

The total delinquency for property taxes at this time last year was $5.8 million.

Features editor Lynnette Hintze may be reached at 758-4421 or by email at lhintze@dailyinterlake.com.