Morrill Memorial and Harris Library Investment Committee

Minutes of January 15, 2019 Meeting

Present:  Cindy Stableford, Betsy Ruml, Gretchen Rittenhouse, John Hawkins, Rachel Kurland

Minutes of the 5/22/18 meeting were approved.

Rachel provided an update report for the Library Trustees:

1.    The Trustees do not need to take a distribution from the endowment this year.  Despite some unexpected building needs, they were able to cover all expenses and still come out ahead for the year.  They still expect about $4,000 in additional expenses but have enough cash to cover them.

2.    The Library has about $50K in the checking account.  While they have some upcoming expenses, they would like to earn some money on the unused portion.   They have investigated Mascoma Savings Bank CDs, which are currently offering a competitive rate.  The Committee agreed it would be a good idea to put $25K-$40K (depending on anticipated needs) in laddered CDs.

3.    The Trustees have not discussed whether or not they will contribute 1% of donations to the endowment this year.  Rachel will raise this at the next meeting of the Trustees.

Cindy reported for the Friends:

1.    The Friends contributed  $800 to the endowment in 2018.

2.    They ended the year with a $19,000 balance.  About $1,500 has been approved to use for library needs but has not yet been spent.

3.    Lots of new members of the Friends Board.

Report from the Chair (Cindy):

1.    Cindy presented the draft of the Annual Report, which the Committee reviewed and approved.

2.    Transfer of $85.76 from Swan/Downer/Ordway Funds to the Library was approved as per restricted funds.

3.    Annual distribution to Library:  Although there is $7,584 available to be transferred per our formula, the Trustees indicate that they do not need it in 2019, so it will be added to previously deferred funds.  The total of deferred funds now stands at $21,632.  Per earlier discussion, there is no need to keep the deferred funds separate from the other endowment investments.

4.    Does our distribution formula work over the long term?  Betsy suggested that we do a careful analysis in a year or so.  She also suggested that we add a comparison calculation to our analysis spreadsheet comparing the current Year End Portfolio Balance less deferred distributions with the actual 2016 Year End balance.  Cindy will take a stab at it for our next meeting.

Betsy reviewed the portfolio.

1)   Overall, the portfolio is down 5% for the year, all due to losses in the 4^thquarter.  Noted that the portfolio is up 2.8% since year end.

2)  Although the Total Bond Market investments (1/2 of our bond holdings) performed better during the rough 4^thquarter than the our Short-term Bond investments, we decided to keep the current split, since it may be less volatile over the long run.

3)  Currently 65% equity (stocks and REITS)/35% FI, matching our target allocation is 65/35. Our portfolio “styles” look balanced, so no need to move funds around.

4)  Cash balance is about $16,500; our target is $10,000.  The Committee approved moving the excess over $10,000 into the Total Bond market fund (VBTLX).  Cindy will make the transfer.

The meeting was adjourned. Next meeting is scheduled for Tuesday, May 14, 2019 at 9AM at the Library.

Respectfully Submitted,

Gretchen Rittenhouse

Secretary