Bristol Borough will be able to open up its investment portfolio due to the recent passage of Act 10 of 2016.
Act 10 of 2016, passed on March 25, opens the investing possibilities for municipalities in the Pennsylvania. The legislation makes certain investments, which have been common in other states, legal in Pennsylvania.
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John Molloy of Pfm Asset Management LLC was present at the council’s Monday work session to outline the new investment possibilities.
The number one point coming from the meeting is the idea that overall investment securities would not be wholly impacted, and the increase in revenue would be minimal.
Molloy described the change as a “small, incremental type change.”
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“It’s better than nothing, but it’s not going to be a dramatic change,” assured Council President Ralph DiGuiseppe.
The new investment types include commercial papers, bankers’ acceptances and negotiable CD for the Borough. These join treasury investments, other federal agency investments, bank deposits and bank CDs.
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The new investment possibilities are short term investments. Commercial papers have a maximum life of 270 days and bankers’ acceptances have a maximum life of 180 days.
The current portfolio maintained by Bristol is highly reliant on the federal government. The possibilities of the new portfolio should reduce this reliance and increase diversity, Molloy said.
