City investment funds performed well last year, yielding $606,000 in interest for the city’s general asset replacement reserve.
Three $2 million investments from the city’s legacy reserve fund matured in late 2024, generating 7 per cent interest, with the yielded funds set to help support the community’s infrastructure.
Totalling over $36 million, the legacy reserve fund was created following the sale of Orillia Power Distribution.
“The legacy reserve fund was created leveraging funds from the Orillia Power Distribution sale,” said the city’s CFO/treasurer, John Henry. “The principal balance is restricted to investments, with yields directed to the city’s general asset management reserve and supports critical community infrastructure renewal needs.”
The fund is currently divided into seven term investments totalling $16.2 million, ranging in term from 1 to 12 years, with the remaining $20 million invested in long-term principal protected notes.
Henry explained that yields from principal protected notes are linked to index performance, with a recent call on one of these investments yielding 9.25 per cent interest.
He said the city’s term investments are performing well, averaging around 4.5 per cent interest, and city staff anticipate the fund’s bond and GIC portfolio to earn 3.4 – 4.1 per cent – or $550,000 to $650,000 – in 2025.
The principal funds from the three $2 million investments that matured this year were reinvested into 12-year term investments and a 7-year principal protected note.
All funds generated through the legacy fund are directed to the city's general asset management reserve.
