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Local Governments to Get More Access to Cash

January 4th, 2008 by flanews

State officials are about to loosen the spigot on a semi frozen state investment fund, but as Chris Casquejo tells us, it cant come soon enough for some local governments.

Hear it here: State Investment Fund Update

Local governments have about $12 billion in a semi-frozen state investment fund. Withdrawals in the troubled fund have been limited to $2 million per investor. By the end of January, investors will be able to take out 21 percent of their money. For some, that’s not soon enough.

Hillsborough County, for instance, has $500 million in that pool,” said Florida School Boards Association Executive Director Wayne Blanton. “Its obvious that theyre going to need a lot of that money before the end of their fiscal year on June 30th.

Right now, local governments and schools can take out only 15 percent of their money from the state investment fund. If they want to withdraw more, they have to pay a 2 percent penalty.

Leon County Schools had to borrow money to make payroll. The district still has $37 million in the fund. Projects are moving forward, but the districts chief financial officer still has big concerns.

The problem is, if we need to access it, having to have a 2 percent penalty is not what we want to do, said Merrill Wimberley, the chief finacial officer of Leon County Schools. “Besides that, were not sure were earning interest on it.

Fund managers met with concerned investors, telling them that they could expect to withdraw $2.7 billion by April. Governor Charlie Crist believes that the fund is sound, especially with new interim leader Bob Milligan in place. But local governments are still skittish. Hillsborough County is urging other investors in the fund to sue the state.

Posted in Charlie Crist, State News | 2 Comments »

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