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La Salle City Council approves Studio Investments to manage city reserves · Illinois Valley - Shaw Local

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  La Salle’s City Council approves studio investments to manage city reserves. Written
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  by Emily Beebe. This article is being read by an automated voice,
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  brought to you by Everlet. Roughly eighteen million dollars of LaSalle's cash
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  reserves sits in accounts at LaSalle State Bank and Hometown Bank earning
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  interest. On Monday the LaSalle City Council voted to hand management of
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  that money to studio investments. The council, acting on the Finance Committee's
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  recommendation, approved a relationship with Studio Investments. The
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  firm was represented by Phil Slevin, who gave a presentation at the
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  meeting. I invest in four things CDs which you guys already have,
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  US Treasuries, Government Agencies, and Municipal Bonds, Slevin said. Slevin said that
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  the firm keeps maturities short. That protects you guys, or protects any
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  of the other bodies, for interest rates and capital risk, Slevin said.
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  The firm charges 20 basis points on assets under management, calculated monthly.
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  A basis point is one one hundredth of a percent. So if
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  you take a a percent and chop it up, when you find
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  pieces, one of those pieces is that.
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  We charge, Levin said. So it's one fifth of one percent. So
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  on ten million dollars, it would cost twenty thousand dollars a year.
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  Slevin presented a real example from a client to the Finance Committee.
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  The difference was twenty-four thousand dollars a year, Slevin
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  said. And I don’t know any organization that can't use that. First
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  Ward Alderman Bob Thompson asked Slevin whether the fee was based on
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  performance or a set fee. Slevin said it is based on assets
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  under management, so 20 basis points on whatever the account holds. Alderman
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  Thompson also asked why every school in every city isn't doing this.
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  A lot of then are, Slevin said, and secondly, most people just
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  don't know that this is available. City of LaSalle Finance Director John
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  Duncan currently manages a pool of CDs. Second Ward Alderman Tom Ptack
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  said the city made 456,000 in interest from the CDs last year,
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  which was laddered for liquidity. Patak called it the council's fiduciary responsibility
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  to pinch every penny for taxpayers, and said everything would follow state
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  law. The finance committee voted to recommend acceptance, which the city council
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  then voted in a vote of 7-1 to approve it. Alderman Thomson
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  was the sole dissenting vote.