On motion by Supervisor Schaefer, second by Supervisor Ingersoll, the agenda was approved by voice vote.

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1 DRAFT Walworth County Board of Supervisors October 22, 2015 Finance Committee Meeting Minutes Walworth County Government Center, County Board Room W. Walworth Street, Elkhorn, Wisconsin The meeting was called to order by Chair Nancy Russell at 9:33 a.m. Roll call was conducted. Members present included Chair Nancy Russell, Vice Chair Dan Kilkenny (excused at 10:34 a.m.), Supervisors Kathy Ingersoll, Joe Schaefer and Paul Yvarra. A quorum was declared. Others in Attendance County staff: County Administrator David Bretl; County Treasurer Valerie Etzel; Lisa Henke- Risk/Benefits Manager; Comptroller Jessica Conley; Sheriff s Office Business Manager Amanda Lagle; Deputy Director of Health and Human Services Robert Williams; Lakeland Health Care Center Administrator Bernadette Janiszewski; Assistant Jail Administrator Howard Sawyers; Clerk of Courts Sheila Reiff; Land Information Officer Dale Drayna; Director of Information Technology John Orr, UW- Extension Department Head Jenny Wehmeier and Central Services/Public Works Director Kevin Brunner On motion by Supervisor Schaefer, second by Supervisor Ingersoll, the agenda was approved by voice vote. On motion by Supervisor Ingersoll, second by Supervisor Schaefer, the October 13, 2015 special joint Finance/Public Works Committee meeting minutes were approved by voice vote. Public Comment There was none. Unfinished Business There was none. Consent items Chair Russell requested items 8B 1, 2 and 4, and item 8D 2 be considered separately. Vice Chair Kilkenny requested to consider item 8 D, 3b separately. Supervisor Ingersoll made a motion, seconded by Supervisor Schaefer, to approve the remainder of the consent items. The motion carried A, Budget Amendments 1) Health and Human Services HS013 Fund the Drug Court Housing pilot program for one year starting October 1, 2015 HS014 Offset residential treatment center care for a CBRF client 2) Lakeland Health Care Center LH003 Reflect increase in therapy service expense LH004 Transfer funds for Kronos Scheduler software enhancements and training 3) Lakeland School LS001 Increase budget for Transfer of Service account 4) Public Works PW008 Increase funds for state work under discretionary maintenance agreements PW009 Reallocate fringe benefits 5) Sheriff s Office SH005 Reflect anticipated insurance recovery for squad totaled on 09/01/ B, Bids/Contracts 1) Inmate commissary services for the Sheriff s Office jail division

2 Walworth County Board of Supervisors October 22, 2015 Finance Committee Meeting Minutes Page 2 of 5 Chair Russell asked for discussion on the commissary services because the recommended proposal was higher than two of the others submitted. Assistant Jail Administrator Howard Sawyers said the recommended company is the current vendor and due to the complexity of the services, it would take a significant amount of time to train all of the Jail staff on a new system. Trinity Services interfaces well with the Sheriff s Office record management system and offers a $15,000 signing bonus, which would be returned to the County general fund. Russell said she has received complaints that the prices are too high. Sawyers said the commissary service is not a big revenue generator for the Jail. He explained the pricing criteria in the proposals. Staff took the top 50 items in sales and requested individual pricing on those items from prospective vendors. Most of the items sold are hygiene items, snack foods, reading glasses, alternate footwear, word search books, greeting cards, etc. No soda or water is sold. Revenue generated was $19,000 last year. Supervisor Schaefer made a motion, seconded by Vice Chair Kilkenny, to approve the award for inmate commissary services to Trinity Services Group, Inc. for the proposed contract amount of $301, The motion carried ) Stop loss for 2016 health insurance Chair Russell said this was discussed at the Human Resources Committee meeting on October 21 and there were no objections to staff s recommendation. Risk/Benefits Manager Lisa Henke noted that the information concerning the proposed carrier was distributed at the meeting. The Request for Proposals (RFP) was sent to 12 vendors; of those, five responded. Auxiant and M3 assisted staff in evaluating the proposals and recommended staying with the current carrier, HM Insurance, who was the lowest overall bidder. HM Insurance is willing to guarantee pricing based on the current policy, contingent upon county acceptance by October 31. The County s maximum exposure per claim would be $125,000, without the ability to laser individuals, which means that if a participant had expenses above the risk amount, the county could potentially have additional liability before the stop loss insurance would take effect. Supervisor Schaefer made a motion, seconded by Supervisor Ingersoll, to approve the award to HM Insurance for the 2016 stop loss insurance, in the amount of $2,016,969 (approximate annual rate). The motion carried ) Award sale(s) of tax foreclosure properties 4) Discussion and possible action regarding establishment of minimum bids for unsold tax foreclosure properties Treasurer Val Etzel distributed an updated list of the foreclosure properties. One of the properties, #FRA in the Town of Delavan, was repurchased by the previous owner and removed from the list. One of the properties listed on the sheet in red was added to be sold because the bid received was rejected. The proposed minimum bids were calculated by taking the previous minimum bids and reducing the amount by 24%. Supervisor Ingersoll made a motion, seconded by Vice Chair Kilkenny, to reject the bid amount for parcel FRA received on October 12, The motion carried 5-0. Supervisor Schaefer made a motion, seconded by Supervisor Ingersoll, to approve the recommended minimum bids for unsold tax foreclosure properties as amended, per the Treasurer s recommendation. The motion carried C, Surplus 1) Recommendation to declare Sheriff s Office squad car as surplus in lieu of vehicle approved as surplus in May 2015, and to sell said vehicle at auction 8D, Reports 1) Quarterly delinquent tax report 3 rd quarter 2015

3 Walworth County Board of Supervisors October 22, 2015 Finance Committee Meeting Minutes Page 3 of 5 2) Quarterly property loss report 3 rd quarter 2015 Chair Russell commented that the County will recover money on some of the claims. She expressed concern over the employees and departments with multiple incidents. Vice Chair Kilkenny commented that it might be beneficial to do a per mile analysis of claims by department, as the Sheriff s Office and Public Works employees are on the road the majority of the time. County Administrator Bretl said that it is good practice to review the report. The County has a process in place whereby after an accident, a form is generated to departments to provide an explanation and review of the incident to determine if further action/discipline is warranted. Vice Chair Kilkenny made a motion, second by Supervisor Ingersoll, to place the report on file. The motion carried ) Update on tax incremental financing districts (TIDs) a) Summary of current TIDs b) Village of Darien TID #3 and TID #2 Vice Chair Kilkenny noted apparently the Village of Darien refinanced but was still charging the TID the higher interest rate. Comptroller Jessica Conley said the auditor has to recalculate several of the years based upon the new interest rate for those years, and the interest charged will be corrected. New Business Resolution **-11/15 Accepting the Donation of $525 from the Elkhorn Fund to UW-Extension to Support the Parenting 1 st, 2 nd and 3 rd Year Newsletter Project Supervisor Schaefer made a motion, seconded by Supervisor Ingersoll, to recommend approval of accepting the donation. Chair Russell asked why the donation only includes Elkhorn. UW-Extension Department Head Jenny Wehmeier said the donation has primarily been funded by Elkhorn and East Troy Kiwanis, but everyone applicable in the County receives the newsletter. The motion carried 5-0. Ordinance **-11/15 Amending Section of the Walworth County Code of Ordinances Relating to Acceptance of Donations to the UW-Extension Department The ordinance amendment changes/expands the list of programs for which UW-Extension is able to accept restricted donations under $5,000. Supervisor Ingersoll made a motion, seconded by Vice Chair Kilkenny, to recommend the ordinance amendment. The motion carried 5-0. Resolution **-11/15 Authorizing a Contract with the Wisconsin Department of Revenue for the Collection of Debt Clerk of Circuit Court Sheila Reiff said the Wisconsin Department of Revenue (DOR) has hired more agents to assist with debt collection. State statute allows the Clerk to contract with the DOR if approved by the County Board. Reiff said her office would still use tax intercepts and set up pay plans, but would call the DOR to collect when those efforts are unsuccessful. Supervisor Schaefer made a motion to recommend approval of the contract with the Wisconsin Department of Revenue for debt collection. The motion carried 5-0. Ordinance **-11/15 Amending Section of the Walworth County Code of Ordinances Relating to the Collection of Debt Bretl said this ordinance amendment codifies the resolution authorizing contracting with DOR for debt collection. Supervisor Schaefer made a motion, seconded by Supervisor Ingersoll, to recommend approval of the ordinance. The motion carried 5-0.

4 Walworth County Board of Supervisors October 22, 2015 Finance Committee Meeting Minutes Page 4 of 5 Discussion and possible action authorizing approval of the Strategic Initiative Grant application by the Information Technology/Land Information department Director of Information Technology John Orr said part of Act 20 adopted in the 2013 State budget requires the creation of a Statewide Parcel Layer in GIS format. This Layer will include county parcel and specific attribute information for the 72 counties, which will eventually be made available to the public. Because of the significant work involved in amassing the data for the Layer, a Strategic Initiative grant is available for each county to help accomplish its goals. The grant is renewable each year; once the requirements for the State are met, Orr said subsequent grant funds can be used for updates and modifications to other systems. Supervisor Schaefer made a motion, seconded by Vice Chair Kilkenny, to authorize approval of the Strategic Initiative Grant application. The motion carried 5-0. Resolution **-11/15 Authorizing Addition to Previously Established Pre-Approved Recurring Grants List Relative to the State of Wisconsin Strategic Initiative Grant Supervisor Schaefer made a motion, seconded by Supervisor Ingersoll, to approve the addition of the State of Wisconsin Strategic Initiative grant to the pre-approved recurring grants list. The motion carried 5-0. Ordinance **-11/15 Amending Section of the Walworth County Code of Ordinances Relative to Fees The ordinance amendment incorporates revisions to existing fees or implementation of new fees. In addition, where applicable, sales tax has been included in the established fees. Vice Chair Kilkenny made a motion, seconded by Supervisor Ingersoll, to recommend approval of the amended fee ordinance as corrected to the County Board. The motion carried 5-0. Resolution **-11/15 Adopting the 2016 Appropriation of the Walworth County Budget and CIP Plan Bretl reminded the Committee that the budget can still be amended up until adoption on November 10. Chair Russell expressed concern over the Health and Human Services renovation, scheduled for engineering in 2018 and construction in The construction is estimated to cost $8.5 million, and she feels the existing building, originally designed as a mental health facility, could never be made efficient for current operations. There are still issues with temperature controls in various areas of the facility. She suggested a study in 2016 to discuss options for new construction vs. renovation. Supervisor Schaefer noted that the years on the table in Exhibit B were incorrect. The first year should be 2016, ending with Vice Chair Kilkenny made a motion, seconded by Supervisor Yvarra, to recommend approval of adoption of the 2016 appropriation of the Walworth County budget and CIP plan, with the correction of the years on Exhibit B. The motion carried 5-0. Resolution **-11/15 Establishing the County Tax Levy to Support the 2016 Budget Appropriation The overall tax levy increase is 0.65%. Supervisor Schaefer made a motion, seconded by Vice Chair Kilkenny, to recommend County Board approval of the resolution establishing the county tax levy to support the 2016 budget appropriation. The motion carried 5-0. Discussion and possible action regarding property insurance coverage for policy year 2016 Bretl said the premium went up 39%. As MPIC, our new provider, gains experience, hopefully premiums will adjust. The County has modern infrastructure and good risk management practices. Bretl expressed concern over the municipalities ability to absorb the increases. Vice Chair Kilkenny made a motion, seconded by Supervisor Ingersoll, to accept the report. The motion carried 4-0.

5 Walworth County Board of Supervisors October 22, 2015 Finance Committee Meeting Minutes Page 5 of 5 Ordinance **-11/15 Amending Section (c)(2) of the Walworth County Code of Ordinances Related to Committed Fund Balance Severance Payout Conley said the ordinance amendment would allow Lakeland School and enterprise funds to use the general fund for severance payouts to make them whole. Supervisor Ingersoll made a motion, seconded by Chair Russell, to recommend approval of the ordinance amendment. The motion carried 4-0. Update regarding Lake Geneva Tax Incremental Financing District Conley said one of the biggest issues with the TIF financial report was debt service related for the reporting of revenue and expense. The other major issue was an interpretation of how the project plan total available budget was calculated. Bretl said he has met with City officials and reiterated that the County wants the District closed. Correspondence There was none. Confirmation of next meeting: The next meeting was confirmed for Thursday, November 19, 2015 at 9:30 a.m., Government Center County Board Room 114. Adjournment On motion by Supervisor Schaefer seconded by Supervisor Yvarra, Chair Russell adjourned the meeting at 10:47 a.m. Submitted by Becky Bechtel, Administrative Clerk. Meeting minutes are not considered final until approved by the Committee at the next regularly scheduled committee meeting.

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14 Memorandum Treasurer Valerie Etzel County Treasurer To: Finance Committee From: Valerie Etzel, County Treasurer Date: 11/10/2015 Re: Report to Committee County Owned Properties Bids Bids were solicited on Wisconsin Surplus for the remaining county owned parcels and they are due November 13, Treasurer staff will summarize the bids received and provide the profit/loss on parcels that were sold. The Report to Committee will be presented at the November 19, 2015 Finance Committee meeting. The Report to Committee is not available for inclusion in this packet due to the bid deadline of November 13, I will be in attendance at the November 19, 2015 Finance Committee meeting for further discussion. ve 100 W. Walworth P.O. Box 1001 Elkhorn, WI Tel Fax

15 Memorandum Treasurer Valerie Etzel County Treasurer To: Finance Committee From: Valerie Etzel, County Treasurer Date: 11/10/2015 Re: Establishment of Minimum Bid County Owned Properties At the Finance Committee meeting on November 19, 2015, a report detailing the remaining county owned properties with a recommended minimum bid amount will be presented. The report is not available for inclusion in this packet due to the bid deadline of November 13, I will be in attendance at the November 19, 2015 Finance Committee meeting for further discussion. ve 100 W. Walworth P.O. Box 1001 Elkhorn, WI Tel Fax

16 WALWORTH COUNTY, WISCONSIN QUARTERLY INVESTMENT REPORT September 30, 2015 WALWORTH COUNTY FINANCE OFFICE 100 W. WALWORTH STREET ELKHORN, WI

17 September 30, 2015 WALWORTH COUNTY, WISCONSIN Quarterly Investment Report TABLE OF CONTENTS EXECUTIVE SUMMARY...1 INVESTMENT OVERVIEW AND OBJECTIVES...2 REQUIREMENTS & COMPLIANCE...3 BUDGET PERFORMANCE...4 RESTRICTED ACCOUNT BUDGET PERFORMANCE SUMMARY...5 INVESTMENT BENCHMARKS...5 BMO INVESTMENT BENCHMARKS & RESPONSE...6 TOTAL PORTFOLIO OVERVIEW...7 LOCAL GOVERNMENT INVESTMENT POOL OVERVIEW...8 MONEY MARKET OVERVIEW...9 CERTIFICATES OF DEPOSIT OVERVIEW...10 SECURITIES/DEBT PORTFOLIO OVERVIEW...11 APPENDIX INVESTMENT PORTFOLIO VALUATION AT COST... A PERSHING HOLDINGS... B BMO PORTFOLIO HOLDINGS... C i

18 September 30, 2015 WALWORTH COUNTY, WISCONSIN Quarterly Investment Report EXECUTIVE SUMMARY The County s total investment portfolio shall be defined as all county cash and investments not reserved in a separately maintained account for a specific purpose. Funds are valued in this report at bank statement value as of the date specified. Accounts not included in the total investment portfolio are restricted by a third party. The key objectives in managing the County s total investment portfolio are to provide safety of principal, to ensure liquidity to meet operating requirements, to generate a market rate of return ( Yield ) on the investments, and to manage the portfolio within applicable laws. Cash flow projections match revenues with expenditures to ensure prudent investment principles to enable the County to soundly meet its financial obligations. The Investment Portfolio shall be structured in relation to prevailing budgetary and economic environments, taking into account the County s investment risk constraints and cash flow characteristics. Walworth County s investment portfolio is currently in compliance with Wisconsin statutes, the Walworth County Code of Ordinances and the County s Administrative Procedures Manual. Walworth County s investment portfolio has been maintained to provide safety of investments and cash flow needs. Investments are diversified into different investment vehicles to provide safety. In addition, all securities held are either backed by the U.S. Government or meet minimum ratings set by specified agencies. Our investment portfolio is entirely comprised of investments made during the low interest environment. The Finance department continues to follow economic news and seek input from brokers and advisors on near and long-term investment yield potential. The Local Government Investment Pool (LGIP) yields continue to remain low. Rates have been under 0.25% since November, The annualized LGIP rate has a current average of 0.11%. Current collateralized money market yields are as follows: Mid-America 0.63% and Associated 0.20%. The money markets provide the County with liquidity and offer a higher average yield than a six month treasury currently yielding 0.08%. We also maintain a collateralized money market with Chase, currently yielding 0.02% with a balance of $3.8 million, as it allows for immediate access to funds. The investment portfolio with BMO is at $5.3 million, yielding 0.88% annually, net of fees, not including market adjustments. Portfolio duration is currently 1.78 years to maturity, and contains $2.7 million in agency securities, $2.4 million in treasury notes, and $0.2 million in a money market. The brokered portfolio held at Pershing is at $47.3 million, yielding 0.95% (not including market adjustments) annually which includes $44.3 million in agency securities and $3.0 million in municipal debt. Portfolio duration is currently 1.70 years to maturity. The OPEB Trust will be reviewed separately from our operating investment portfolio, as this information is invested with a different investment philosophy due to its long term nature. 1

19 September 30, 2015 WALWORTH COUNTY, WISCONSIN Quarterly Investment Report INVESTMENT OVERVIEW AND OBJECTIVES As is mentioned above, the main objectives in managing the County s total investment portfolio are to provide safety of principal, to ensure liquidity to meet operating requirements, to generate a market rate of return ( Yield ) on the investments, and to manage the portfolio with applicable laws. The County s total investment portfolio is currently comprised of the following types of investments: LOCAL GOVERNMENT INVESTMENT POOL The primary objective of the LGIP is to provide for the prudent management of public funds on behalf of the local government investor. The investment strategy of this fund is prioritized as: safety of the principal, liquidity, and the rate of return. The funds in LGIP may invest in obligations of the U.S. Treasury and its agencies, Commercial Paper, Bank Time Deposits/Certificates of Deposit, Bankers Acceptances, Asset Backed Securities, and Repurchase Agreements (Repo) secured by the U.S. Government. LGIP does not insure its Commercial Paper. CERTIFICATES OF DEPOSIT Certificates of deposit and other evidences of deposits from county board approved financial institutions which are authorized to transact business in the state, which time deposits mature in not more than three years. THE CERTIFICATE OF DEPOSIT ACCOUNT REGISTRY SERVICES, (CDARS) Financial institutions can offer CDARS because they are members of a special network. When a large deposit is placed with a network member, that institution uses CDARS to place the funds into certificates of deposit issued by banks in the network. This occurs in increments of less than the standard FDIC insurance maximum to ensure that both principal and interest are eligible for full FDIC insurance. With the help of a sophisticated matching system, network members exchange funds. This exchange occurs on a dollar-for-dollar basis, so that the equivalent of the original deposit comes back to the respective institution and effectively stays local (meaning the full amount can support lending initiatives that build a stronger local community). The full amount of the original deposit becomes eligible for complete FDIC protection, and the institution receives just one regular statement detailing all your holdings. U.S. GOVERNMENT/TREASURY SECURITIES Obligations of the United States of America, its agencies and instrumentalities, provided payment of the principal and interest is fully guaranteed by the issuer. MUNICIPAL DEBT Instruments of any county, city, drainage district, vocational college, village, town or school district of the State of Wisconsin. PUBLIC FUNDS MONEY MARKET ACCOUNT The County has approved by resolution Public Funds money markets that are secured by collateral. These investments are used to provide short-term diversification and increase the current yields. 2

20 September 30, 2015 WALWORTH COUNTY, WISCONSIN Quarterly Investment Report REQUIREMENTS AND COMPLIANCE ITEM DESCRIPTION OF REQUIREMENT ACTUAL PORTFOLIO Credit Risk: Collateral Policy Security Diversification Financial Institutions Limits Debt Limits Liquidity Risk Reinvestment Risk Market Risk: Maturity Restrictions Investments other than U.S. Treasury backed securities or investments not under FDIC or WI guarantee shall be collateralized for a minimum of % of the deposits. No single agency shall hold more than 50% of the core portfolio, currently $28,460,500. Investments held at any one institution shall be limited to 50% of the core portfolio, currently $28,460,500. Government debt held with any one entity shall be limited to $3 million. Liquid cash shall be maintained at $10 million and available with 1 day notice. Callable securities shall not exceed 50% of securities held. Investments greater than 3 months and less than 1 year shall not exceed 95% of the total portfolio. Investments greater than 1 year and less than 5 years shall not exceed 100% of the core portfolio, currently $56,921,000. Current financial institutions comply Current investment holdings comply All institutions comply All institutions comply $ 66.7 million or 50% $ 16.0 million or 31% $ 16.7 million or 12% $ 35.3 million or 62% INVESTMENT CATEGORY MAXIMUM MATURITY AUTHORIZED LIMIT ACTUAL PORTFOLIO Certificates of Deposit 3 years 50% 5% Operating Cash N/A N/A 2% LGIP N/A 75% 27% Money Markets N/A 95% 27% U.S. Agency Securities 5 years 75% 35% U.S. Treasury Securities 5 years 75% 2% Municipal Debt 5 years 25% 2% INVESTMENT TYPE MARKET VALUE Certificates of Deposit $ 6,326,000 Cash - Depository Bank 2,953,000 LGIP 35,887,000 Money Markets 36,010,000 Portfolio Money Markets 182,000 U.S. Gov. Agency Securities 46,991,000 U.S. Treasury Securities 2,402,000 Municipal Debt 3,053,000 Total $ 133,804,000 US GOVT AGENCY 35% US TREAS 2% MUNI 2% CD 5% CASH 2% LGIP 27% MONEY MARKETS 27% 3

21 September 30, 2015 WALWORTH COUNTY, WISCONSIN Quarterly Investment Report BUDGET PERFORMANCE The first table below shows the actual and budgeted interest earned for the quarter ended September 30, 2015 by investment type. The second table below shows the actual and budgeted interest earned for the quarter ended September 30, 2015 by account. The interest shown is on the county s total cash and investment portfolio. All accounts receive interest income based on the LGIP interest rate or actual interest earned. *Per County ordinance, this market adjustment will add/subtract from the County s committed fund balance amount available for these temporary gains/losses and will not directly offset the investment income budget. Current available funds in the committed fund balance account are $1,007, year to date returns have exceeded budget by $115,255. By diversifying into other investment vehicles, we have been able to increase the County s yields by more than three times the LGIP benchmark. If the entire portfolio was invested at the benchmark rate, the forecasted interest earned year to date would have approximated $134,056. Certificates of deposit currently held on September 30, 2015 have an average return of 0.49%. INVESTMENT TYPE INTEREST 3rd QUARTER EARNED 2015 BUDGET Certificate of Deposit $ 22,898 $ 19,395 U.S. Treasury/Govt. Agency 318, ,607 Local Gov Inv Pool (LGIP) 43,359 15,000 Depository Bank (Sweep) Money Markets 74,857 58,500 Other Accounts Allocated Interest (39,714) (60,945) TOTAL NON-DEPT $ 420,292 $ 318,751 YTD Unrealized Gain/(Loss)* 191,894 N/A ACCOUNT NAME INTEREST 3rd QUARTER EARNED 2015 BUDGET Non-Department $ 420,292 $ 318,751 Children with Disabilities Ed Bd 13,239 9,375 DPW Buildings Reserve DPW Equipment Reserve 1, LHCC Building Reserve 1, LHCC Equipment Reserve Health Insurance 16,402 11,250 Dental Insurance Workers Compensation 2,302 1,875 Risk Management 3,671 1,451 TOTAL PORTFOLIO $ 460,006 $ 344,751 Budget to Actual Variance 115,255 Securities held on September 30, 2015 have a yield to maturity at cost of 0.95% for our brokered securities and 0.88% at the BMO managed portfolio, net of investment fees. 4

22 September 30, 2015 WALWORTH COUNTY, WISCONSIN Quarterly Investment Report RESTRICTED ACCOUNT BUDGET PERFORMANCE SUMMARY Restricted cash and investments in funds/departments receive interest income based on the LGIP interest rate or actual interest earned based on investments held by fiscal agents. ACCOUNT NAME INTEREST EARNED 3rd QUARTER 2015 BUDGET Land Information Fees $ 394 $ 295 Risk Management 6,962 1,451 Clerk of Courts 479 1,875 Waddell Donations Harrison Trust 33 - Total $ 7,947 $ 3,696 INVESTMENT BENCHMARKS Overall Investment Portfolio Benchmark The County has selected the Local Government Investment Pool rate as the benchmark for achievement for the investment portfolio. The following yields are as of September 30, The interest income amount does not include unrealized gains or losses. Investment Portfolio Benchmark (LGIP) Actual Current Holdings Yield to Maturity at Cost 0.14% 0.51% Year to Date Interest Income Net of Fees $ 134,056 $ 452,294 3rd Quarter Average Return at Cost 0.03% 0.10% Rolling 1 Year Average Return at Cost 0.11% 0.43% The results show that the County is currently exceeding expectations in comparison to the benchmark. The County expects interest rates to continue to remain low during The change in strategy to include more diversity of investment types and maturity lengths has proven an increased yield compared to the benchmark. 5

23 September 30, 2015 WALWORTH COUNTY, WISCONSIN Quarterly Investment Report BMO INVESTMENT BENCHMARKS & RESPONSE BMO Benchmark To review the performance of the BMO Short-term Portfolio, the Barclay Government 1-3 year index has been chosen. The investments within the index included US Treasury and Agency securities, which the BMO Shortterm Portfolio holdings allow by the County s investment policy. The following shows the comparison of the BMO Short-term Portfolio to the benchmark selected, net of investment fees. Time Period Benchmark* Actual* 2014, 4th Quarter 0.19% 0.27% 2015, 1st Quarter 0.59% 0.54% 2015, 2nd Quarter 0.15% 0.08% 2015, 3rd Quarter 0.32% 0.30% *Note: Yields shown include unrealized gains or losses on securities which are usually not sold prior to maturity or estimated life of the security. See the BMO Portfolio column in Appendix A for actual return on investment. Portfolio Advisor Response: During the quarter, the total portfolio returned +0.30% net of fees compared to a +0.32% return for the Barclay's 1-3 Year US Government Index. On a one year basis, the portfolio has gained +1.19% net of fees versus +1.20% for the benchmark. It continues to be challenging to generate return with a high-quality, short-duration portfolio given near-zero short-term interest rates. On the whole, central bank policy has aimed to be accommodative, both in the U.S. and abroad. The Fed s decision at its September policy meeting to not raise interest rates fell in line with the declining forecasts for inflation and economic growth the Fed has given over the past year. But in a climate where many expected a rate hike, the Fed staying put sends a strong accommodative message. That said, most Federal Open Market Committee (FOMC) participants still anticipate that rates will increase before the end of this year, including Fed Chairwoman Janet L. Yellen, who used a recent speech to make this point clear. Market expectations for the first Fed hike have been consistently pushed back this year. Market expectations of Fed Moves (% indicates probability of move by this date) 3/31/2015 6/30/2015 9/16/2015 9/17/2015 9/17/ % 28.6% 32.0% N/A 12/16/ % 65.6% 64.3% 45.0% 3/16/ % 85.3% 80.2% 67.9% Source: Bloomberg L.P., BMO Global Asset Management How to read this table: Prior to the Fed meeting on 9/16/2015, the market was factoring in a 64.3% chance of a rate hike by the 12/16/2015 meeting. After the dovish meeting minutes were released on 9/17/2015, the market pushed down the expectation of a rate hike by the 12/16/2015 meeting to 45.0%. - Joseph A. Olson, BMO Wealth Management, October 15,

24 September 30, 2015 WALWORTH COUNTY, WISCONSIN Quarterly Investment Report TOTAL PORTFOLIO OVERVIEW Total Investments by Maturity Time to Maturity 4-5 yr 3-4 yr 3-6 mo 2-3 yr 1-2 yr 6-12 mo 0-3 mo $0 $20 $40 $60 $80 $100 Dollars Invested in Millions TOTAL PORTFOLIO OVERVIEW HISTORICAL BALANCES The following chart shows the historic cash balances of the County portfolio (excluding restricted accounts) with a one year average and 3 year average cumulative cash balance based on monthly balances. Average Balance Cash (1 year) $ 98,145,000 $ 111,598,000 $ 125,375,000 $137,649,000 Cumulative Cash (3 year) $ 89,660,000 $ 99,804,000 $ 111,706,000 $122,509,000 CASH FLOW HISTORY $200 Walworth County Cash and Investment Balance $180 Millions $160 $140 $120 $100 $80 Month

25 September 30, 2015 WALWORTH COUNTY, WISCONSIN Quarterly Investment Report Overview of Fund LOCAL GOVERNMENT INVESTMENT POOL (LGIP) OVERVIEW The Wisconsin Local Government Investment Pool (LGIP) was created in 1975 to give local governments the opportunity to combine their idle cash to make short-term investments equal to those afforded to state government or large local governments. The LGIP has been designed to consistently maintain the integrity of local funds within a diversified and safe portfolio, provide liquidity, and offer rates of return competitive with comparable investments. The funds from the LGIP are combined with the cash balances of the State of Wisconsin and its agencies, the excess cash of the retirement funds invested by the State of Wisconsin Investment Board (SWIB) and managed as one fund called the State Investment Fund (SIF). Investment Objectives The primary objective of the LGIP is to provide for the prudent management of public funds on behalf of the local government investor. The strategy for meeting this objective is to apply the prudent investor standard and insure that the investment of pool assets is prioritized as follows: safety of principal, liquidity, and rate of return. Liquidity Considerations The investment portfolio needs to remain liquid to meet the daily operating requirements that may be reasonably anticipated. This is accomplished by structuring the portfolio so that securities mature concurrent with cash needs to meet anticipated demands. Walworth County expends approximately $10 million per month. In order to keep cash in our checking account low and still pay bills on time, the County maintains a cash balance with the LGIP as it offers same day liquidity. Over the past twelve months, the LGIP balance has averaged $39.7 million. The County s cash flow spikes in February and July occur as a result of temporary investment of property tax receipts. These receipts may be reinvested into securities when interest rates allow for a better return than LGIP. 0.20% 0.18% 0.16% 0.14% 0.12% 0.10% 0.08% 0.06% 0.04% 0.02% 0.00% LGIP Monthly Interest Rates

26 September 30, 2015 WALWORTH COUNTY, WISCONSIN Quarterly Investment Report MONEY MARKET OVERVIEW Money markets allow for liquid investments similar to the local government investment pool that may be drawn upon with less than one week advance notice. Open money markets are restricted to investments within the Wisconsin Statutes Section (1m) and limited to an average maturity of one hundred twenty days or less. The County also allows for collateralized public investment money markets with allowable investment types. The following is a summary of the current investment portfolios and money market accounts. Financial Institution/Manager Type of Account Current Rate Amount Associated Bank Collateralized Money Market 0.20% $ 23,890,701 JPMorgan Chase Bank Collateralized Money Market 0.02% 3,750,212 Mid America Collateralized Money Market 0.63% 8,369,318 BMO Portfolio Money Market Government Money Market 0.01% 182,222 Pershing Money Market Portfolio Money Market 0.01% - Total Money Market 0.28% $ 36,192,453 Mid America Money Market Rates are established by Mid America Bank at the end of each month based on the LGIP rate. Mid America has guaranteed to be at least 0.50% higher than the prior month LGIP rate. These funds are collateralized and available with one week notice. We are currently investing the maximum balance that Mid America Bank will allow. JP Morgan Money Market Rates are established by JP Morgan Chase Bank and are reviewed and adjusted based on the market, with the intent to exceed the sweep rate. Investment is collateralized at a cost included in the earned interest rate. This account can be withdrawn same day, up to 6 times per month. Associated Bank Money Market Rates are established by Associated Bank and are reviewed and adjusted based on the market, with the intent to exceed the LGIP rate. Investment is collateralized at a cost included in the earned interest rate. This account can be withdrawn with one day s notice, up to 6 times per month. 9

27 September 30, 2015 WALWORTH COUNTY, WISCONSIN Quarterly Investment Report CERTIFICATES OF DEPOSIT OVERVIEW CERTIFICATES OF DEPOSIT are short or medium-term, interest-bearing, FDIC-insured debt instruments offered by banks and savings and loans. CDs offer higher rates of return than most comparable investments, in exchange for tying up invested money for the duration of the certificate s maturity. Money removed before maturity is subject to a penalty. CDs are low risk, low return investments, and are also known as time deposits, because the account holder has agreed to keep the money in the account for a specified amount of time, anywhere from three months to three years. Financial Institution Purchase Date Maturity Date Amount Rate % Associated Bank 10/9/ /9/2015 $ 500, Associated Bank 11/13/ /12/2015 1,000, Associated Bank 11/14/ /14/2015 1,000, FirstMerit Bank 12/13/ /18/ , Citizens Bank 1/8/2014 1/8/ , FirstMerit Bank 2/11/2014 2/11/ , Southern Lakes Credit Union 7/11/2015 7/15/ , Associated Bank 8/7/2013 8/3/2016 1,000, Associated Bank 8/14/2015 8/12/2016 1,000, First Citizens State Bank 8/16/2014 8/19/ , Citizens Bank 8/6/ /11/ , Commercial Bank 12/7/ /8/ , First Citizens State Bank 2/23/2015 2/17/ , Yield to Maturity at September 30, 2015 $ 6,326, % During the third quarter, $1,476,125 of certificates of deposit were purchased, and $475,000 of certificates of deposit matured. The average duration of the certificates of deposit at September 30, 2015 is 0.56 years. Although we continue to solicit CD bids, financial institutions have been unresponsive or offering lower than Agency Security interest rates. Financial institutions have shared that they do not need additional cash flow due to excess liquidity. 10

28 September 30, 2015 WALWORTH COUNTY, WISCONSIN Quarterly Investment Report SECURITIES/DEBT PORTFOLIO OVERVIEW U.S. Treasury Securities such as bills, notes and bonds are debt obligations of the U.S. government. When you buy a treasury security, you are lending money to the federal government for a specific period of time. Because these debt obligations are backed by the full faith and credit of the government, they are considered the safest of all investments. The primary advantage of the Treasury securities is safety. In addition, Treasuries generally do not have a call provision. U.S. Government Agency Securities are debt obligations issued by federal agencies or federally sponsored agencies. Federal agencies are direct arms of the U.S. government; federally sponsored agencies are privately owned and publicly chartered organizations which were created by acts of Congress to support a specific public purpose. Government Debt Instruments of any county, city, drainage district, technical college district, village, town or school district of the State of Wisconsin, if the bond or security is rated in one of the two highest rating categories assigned by Standard and Poor s Corporation, Moody s Investors Service, Inc., or other nationally recognized rating agency. Currently the County has agency securities and treasury notes with BMO and agency, treasury, and debt instruments with Pershing. Please see Appendix B and C for individual holding details. Original Cost Value PORTFOLIO SUMMARY Current Total Market Unrealized Value Gain/(Loss) YTD Unrealized Gain/(Loss) Yield to Maturity at Cost Average Duration Institution BMO Portfolio $ 5,286,363 $ 5,298,293 $ 11,930 $ 16, % 1.78 Pershing Portfolio 47,441,953 47,330,189 (111,764) 175, % 1.70 Total Securities $52,728,316 $52,628,482 $ (99,834) $ 191,894 General Investment Portfolio Information The yield to maturity at cost and average duration are per the calculations computed in Tracker, our investment software, for the investments currently held. BMO Short Term Investment Portfolio This portfolio was established on July 29, 2009, within the current ordinance guidelines for the purchase of agency and treasury securities at an average of 1 to 3 years maturity. BMO does not charge commission fees per trade transaction. The cost is 20 basis points annually for the first/minimum balance of $5 million, and 15 basis points for the next $10 million. Pershing Portfolio The County works with four brokers to obtain quotes and bids on investments. The securities are held at Pershing, a subsidiary of Bank of New York Mellon, for safekeeping. During the third quarter, $8,000,000 of agency securities were purchased, $6,000,000 were called, and $1,500,000 matured. 11

29 Definitions of each section below: Investment Yield is the investment revenue divided by the average daily balance to show the quarterly yield and a one year rolling yield. Investment Revenue shows the interest earned by each investment tool on a quarterly and one year rolling period. Average Daily Balance shows the average daily cash balance invested for each investment tool on a quarterly and one year rolling period. Local Gov Investment Pool Mid Amer Money Market WALWORTH COUNTY INVESTMENT REPORT VALUATION AT COST As of 09/30/2015 Investment Yield (Net of Management Fees) Associated CD Chase Money Market Bank Money Market Pershing Portfolio BMO Portfolio JP Morgan Chase Banking Total Investments Time Period th Quarter 0.02% 0.15% 0.13% 0.01% 0.05% 0.20% 0.20% 0.04% 0.12% st Quarter 0.03% 0.15% 0.11% 0.01% 0.05% 0.20% 0.19% 0.01% 0.11% 2nd Quarter 0.03% 0.16% 0.12% 0.00% 0.05% 0.20% 0.19% 0.00% 0.10% 3rd Quarter 0.03% 0.16% 0.12% 0.00% 0.05% 0.21% 0.20% 0.00% 0.10% One Year Ending th Quarter 0.08% 0.59% 0.61% 0.05% 0.20% 0.77% 0.80% 0.16% 0.43% st Quarter 0.09% 0.60% 0.57% 0.04% 0.20% 0.79% 0.79% 0.13% 0.43% 2nd Quarter 0.10% 0.61% 0.52% 0.03% 0.20% 0.80% 0.78% 0.09% 0.43% 3rd Quarter 0.11% 0.62% 0.48% 0.02% 0.20% 0.81% 0.78% 0.05% 0.43% Local Gov Investment Pool Investment Revenue (Net of Management Fees/Gross of Market Adjustments) Associated Mid Amer Money Market CD Chase Money Market Bank Money Market Pershing Portfolio BMO Portfolio JP Morgan Chase Banking Total Investments Time Period th Quarter 4,451 12,238 10, ,413 92,488 10, , st Quarter 9,671 12,331 8, ,472 92,121 10, ,369 2nd Quarter 15,503 12,972 7, ,928 88,805 10, ,116 3rd Quarter 18,186 13,347 7, ,280 99,078 10, ,808 One Year Ending th Quarter 28,288 48,532 48,233 1,862 43, ,537 41,833 3, , st Quarter 31,882 48,942 43,110 1,128 45, ,492 41,780 3, ,311 2nd Quarter 39,331 49,640 37, , ,839 41,454 2, ,447 3rd Quarter 47,809 50,887 33, , ,491 41,320 1, ,725 Local Gov Investment Pool Average Daily Balance Associated Bank Money Market JP Morgan Chase Banking Mid Amer Chase Pershing BMO Total Time Period Money Market CD Money Market Portfolio Portfolio Investments th Quarter 21,073,057 8,322,609 7,742,195 1,843,778 22,640,224 45,362,732 5,252,362 2,058, ,295, st Quarter 35,338,819 8,334,862 7,139,985 4,015,909 23,263,282 45,426,394 5,266,751 2,024, ,810,796 2nd Quarter 47,919,473 8,347,438 6,339,392 2,878,665 23,923,241 43,943,581 5,281,962 2,251, ,884,834 3rd Quarter 54,416,848 8,360,586 5,844,868 3,641,396 24,360,963 47,131,861 5,284,236 7,711, ,752,724 One Year Ending th Quarter 32,405,607 8,271,689 8,045,209 3,478,045 21,672,490 41,439,565 5,227,901 2,536, ,077, st Quarter 34,344,238 8,283,673 7,577,370 3,126,395 22,874,229 43,092,943 5,239,074 2,438, ,976,915 2nd Quarter 37,725,534 8,295,911 7,218,467 2,815,417 23,156,687 44,345,396 5,251,638 2,354, ,163,660 3rd Quarter 39,688,321 8,341,393 6,765,735 3,090,483 23,547,451 45,470,531 5,271,324 3,523, ,698,410 Comparison to Benchmark: Description LGIP Portfolio Rate of Return - Quarterly 0.03% 0.10% Rate of Return - Annualized 0.11% 0.43% Appendix A

30 Walworth County Investment Report Portfolio Holdings as of 09/30/2015 Pershing (Custodian for Broker/Dealer Transactions) Description Maturity Quantity Cost Market Total Unrealized Gain/(Loss) Pershings MM N/A - $ - $ - $ - Subtotal Cash & Cash Equivalent - $ - $ - $ - FAMC /24/2018 1/24/2018 1,000,000 $ 998,900 $ 1,000,200 $ 1,300 FAMC 1 9/26/2016 9/26/2016 2,000,000 2,015,140 2,012,080 (3,060) FAMC 2 7/27/2016 7/27/ , , ,430 (18,670) FAMC /29/2016 4/29/2016 1,000,000 1,046,104 1,012,170 (33,934) FAMC /29/2016 4/29/2016 1,000,000 1,045,293 1,012,170 (33,123) FFCB 0.4 1/14/2016 1/14/2016 1,000, ,374 1,000,650 1,276 FFCB 0.6 4/25/2017 4/25/2017 1,000, ,020 1,000, FFCB /9/2016 5/9/2016 1,000,000 1,000,760 1,002,330 1,570 FFCB /28/2016 3/28/2016 1,000, ,900 1,004,130 4,230 FFCB /12/2016 9/12/2016 1,000,000 1,000,000 1,006,790 6,790 FFCB /21/2018 5/21/2018 1,000,000 1,001,160 1,011,170 10,010 FHLB /9/2016 8/9/2016 1,000,000 1,000,000 1,000, FHLB /10/2017 3/10/2017 1,000,000 1,002,600 1,002, FHLB /27/ /27/2018 1,000, ,200 1,000,650 1,450 FHLB 1.1 4/20/ /20/2018 1,000,000 1,000,800 1,001,800 1,000 FHLB /10/ /10/2018 1,000,000 1,000,000 1,006,410 6,410 FHLB /29/ /29/2018 1,000,000 1,000,000 1,004,780 4,780 FHLB /11/ /11/ , , ,250 (12,945) FHLB /10/2016 6/10/2016 1,000,000 1,046,700 1,011,810 (34,890) FHLB /8/2018 6/8/2018 1,000,000 1,126,490 1,099,980 (26,510) FHLB Step 6/30/ /30/2017 1,000,000 1,000,000 1,001,440 1,440 FHLB Step 8/24/ /24/2018 1,000,000 1,000,000 1,000, FHLMC /24/ /24/2015 1,000,000 1,001,282 1,000,450 (832) FHLMC 0.7 5/8/2017 5/8/2017 1,000, ,250 1,000,930 22,680 FHLMC 0.7 5/8/2017 5/8/2017 1,500,000 1,501,125 1,501, FHLMC 1 11/27/ /27/2017 1,000,000 1,000,000 1,000, FHLMC 1 6/29/2017 6/29/ , , ,410 8,960 FHLMC 1 9/22/ /22/2017 1,000,000 1,000,000 1,001,450 1,450 FHLMC 1 9/27/2017 9/27/2017 1,000,000 1,002,500 1,005,450 2,950 FHLMC 1 9/29/2017 9/29/ , , ,025 12,795 FHLMC /22/ /22/2017 1,000,000 1,000,000 1,001,840 1,840 FHLMC /26/ /26/2017 1,000, ,100 1,007,520 8,420 FHLMC /28/ /28/2018 1,000,000 1,000,000 1,003,860 3,860 FHLMC /28/ /28/2018 1,000, ,650 1,003,660 4,010 FHLMC 1.3 8/24/ /24/2018 1,000,000 1,000,000 1,002,240 2,240 FHLMC 1.5 6/28/ /28/2019 1,000, ,500 1,006,680 11,180 FNMA /21/ /21/2015 1,000, ,250 1,000,540 1,290 FNMA /26/2016 8/26/2016 1,000,000 1,002,204 1,001,690 (514) FNMA 1 4/25/2017 4/25/2017 1,000,000 1,000,000 1,005,810 5,810 FNMA /27/2017 4/27/2017 1,000,000 1,013,950 1,008,310 (5,640) FNMA /30/2017 1/30/ , , ,775 (6,975) FNMA /26/ /26/2015 1,000,000 1,033,877 1,001,000 (32,877) FNMA /14/ /14/2018 1,000,000 1,011,100 1,011,060 (40) FNMA Step 5/15/ /15/2018 2,000,000 1,999,100 2,001,820 2,720 Subtotal Government Agency Coupon Securities 44,000,000 $ 44,354,054 $ 44,277,305 $ (76,749) City of Monona 2 10/1/ /1/ ,000 $ 312,927 $ 306,984 $ (5,943) Milwaukee Area Tech College 2 6/1/2016 6/1/ , , ,505 (8,330) Milwaukee Area Tech College 2 6/1/2016 6/1/ , , ,909 (10,749) Ozaukee County 2 3/1/2016 3/1/ , , ,384 (4,522) Verona Area Sch. Dist. 2 4/1/2017 4/1/ , , ,298 (7,196) Verona Area Sch. Dist. 2 4/1/2018 4/1/ ,000 1,002,079 1,003,804 1,725 Subtotal Municipal Debt 3,000,000 $ 3,087,899 $ 3,052,884 $ (35,015) TOTAL PERSHING PORTFOLIO 47,000,000 $ 47,441,953 $ 47,330,189 $ (111,764) Diversification: Cash & Cash Equivalents 0% - $ - $ - $ - Government Agency Securities 94% 44,000,000 44,354,054 44,277,305 (76,749) US Treasury Notes 0% Municipal Debt 6% 3,000,000 3,087,899 3,052,884 (35,015) Total PERSHING PORTFOLIO 100% 47,000,000 $ 47,441,953 $ 47,330,189 $ (111,764) Breakout by Security Type: Maturity Schedule (assumes no-call) FAMC $ 5,543, month $ 3,503,240 FFCB 6,025, month 2,206,164 FHLB 10,631, month 10,430,504 FHLMC 13,542, year 12,022,007 FNMA 8,535, year 17,157,934 Municipal Debt 3,052, year 2,010,340 $ 47,330, year - $ 47,330,189 Portion Callable or Mature within 2 years Callable $ 16,048,490 Maturity 28,161,915 $ 42,207,515 * * Grand total eliminates the duplication of bonds that are in both the callable and maturing within 2 years categories. Appendix B

31 Walworth County Investment Portfolio Portfolio Holdings as of 09/30/2015 BMO Portfolio Description Maturity Date Quantity Cost Market Total Unrealized Gain/(Loss) BMO Government MM N/A 182,222 $ 182,222 $ 182,222 - Subtotal Cash & Cash Equivalent 182,222 $ 182,222 $ 182,222 $ - FHLB /20/ /20/ ,000 $ 100,010 $ 100,047 $ 37 FHLB 1 6/21/2017 6/21/ , , ,223 (712) FHLB /11/ /11/ , , ,375 (3,399) FHLB /10/2016 6/10/ , , ,181 (3,082) FHLMC /7/2018 3/7/ , , ,109 (208) FHLMC 1 3/8/2017 3/8/ , , ,954 1,355 FHLMC 1 9/29/2017 9/29/ , , ,210 2,203 FHLMC 2 8/25/2016 8/25/ , , ,141 (3,141) FNMA 0.5 3/30/2016 3/30/ , , , FNMA /26/ /26/ , , , FNMA /20/ /20/ , , , FNMA /30/2017 1/30/ , , ,865 2,984 FNMA /28/2016 9/28/ , , , FNMA /28/2016 9/28/ , , ,224 (1,494) FNMA /15/ /15/ , , ,466 (888) FNMA /15/ /15/ , , ,466 (1,352) FNMA /28/ /28/ , , ,105 (2,028) FNMA /27/ /27/ ,000 75,170 76,364 1,194 FNMA /27/ /27/ ,000 74,975 76,365 1,390 Subtotal Government Agency Coupon Securities 2,695,000 $ 2,719,750 $ 2,714,084 $ (5,666) T-Note 0.5 8/31/2016 8/31/ ,000 $ 99,957 $ 100,121 $ 164 T-Note /15/2017 7/15/ , , ,847 1,421 T-Note /15/2017 8/15/ , , ,716 1,372 T-Note /15/2017 8/15/ , , ,954 1,493 T-Note 1 5/15/2018 5/15/ , , , T-Note 1 5/31/2018 5/31/ , , ,764 2,849 T-Note 1 9/15/2018 9/15/ , , , T-Note 1 9/30/2016 9/30/ , , ,919 (358) T-Note /31/ /31/ ,000 48,381 50,045 1,664 T-Note /31/ /31/ ,000 72,487 75,068 2,581 T-Note /31/ /31/ , , ,813 3,192 T-Note 1.5 6/30/2016 6/30/ , , ,918 (1,062) T-Note 1.5 6/30/2016 6/30/ , , ,377 3,064 T-Note /30/2020 6/30/ , , , T-Note /31/2020 7/31/ , , , T-Note /30/2018 4/30/ , , ,870 (1,673) Subtotal US Treasury Notes 2,380,000 $ 2,384,391 $ 2,401,987 $ 17,596 TOTAL BMO WEALTH MANAGEMENT PORTFOLIO 5,257,222 $ 5,286,363 $ 5,298,293 $ 11,930 Diversification: Cash & Cash Equivalents 3% 182,222 $ 182,222 $ 182,222 $ - Government Agency Securities 52% 2,695,000 2,719,750 2,714,084 (5,666) US Treasury Notes 45% 2,380,000 2,384,391 2,401,987 17,596 Municipal Debt 0% Total BMO PORTFOLIO 100% 5,257,222 $ 5,286,363 $ 5,298,293 $ 11,930 Breakout by Security Type: Maturity Schedule (assumes no-call) FHLB $ 527, month $ 657,862 FHLMC 604, month - FNMA 1,581, month 1,158,898 US Treasury Notes 2,401, year 1,661,700 $ 5,116, year 1,129, year 335,543 Portion Callable or Mature within 2 years 4-5 year 354,384 Callable $ - $ 5,298,293 Maturity $ 3,478,460 3,478,460 Appendix C

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36 Memorandum Administration David A. Bretl County Administrator Nicole Hill Administrative Assistant Vicki L. Price Administrative Clerk To: Cc: From: Walworth County Finance Committee Nicki Andersen, Deputy County Administrator Finance Valerie Etzel, Treasurer David A. Bretl, County Administrator Date: November 12, 2015 Re: PACE Financing You will recall several months ago Derek D Auria from the Walworth County Economic Development Alliance approached the Finance Committee with a request for the county to consider enactment of a PACE financing program. Subsequent to his request, I met with both Nicki and Val to discuss the merits of the program. I am no expert on the topic, but I will do my best to summarize how I believe the program works. Property Assessed Clean Energy (PACE) is a means of financing energy efficiency upgrades or renewable energy installations for buildings. Essentially PACE uses the property tax collection process as a means of securing and servicing private loans made for energy efficiency projects. Examples of upgrades range from adding more attic insulation to installing rooftop solar panels. PACE programs help home and business owners pay for the upfront costs of green initiatives, which the property owner then pays back through a special charge on their property tax bill. This allows property owners to begin saving on energy costs while they are paying for their solar panels, for example. One of the most notable characteristics of PACE programs is that the loan is attached to the property rather than an individual. It is permissible for any political subdivision to establish a PACE program. Section (8) of the Wisconsin Statutes (attached) authorizes these programs. Currently, the City of Milwaukee runs a PACE program. It is possible for a municipality or town within Walworth County to pass an ordinance of its own. 100 W. Walworth St. P.O. Box 1001 Elkhorn, WI Tel Fax One example of how the program might work is as follows: Business A borrows $50,000 from a participating bank to make energy upgrades that will result in an energy savings on its utility bill of $5,000 per year. The cost of the upgrade is $50,000. Under the PACE program, a special charge would be placed on the property tax bill every year, for, say 14 years in the amount of $4,000 per year.

37 Memo to Finance Committee PACE Financing November 12, 2015 Page 2 of 2 If everything goes according to plan, the business will have paid the county $54,000, which the county will have collected and paid to the bank. The business will have increased its cash flow by $1,000 per year and saved energy. Of course, things don t always go as planned. This is where staff has some concerns and is an area that I would like to discuss at our next finance committee meeting. If, for example, the business becomes delinquent on its taxes, $16,000 of the special charge will be due and owing at the time the county takes the property. As I understand it, the special charge will need to be settled first. If the proceeds of the tax sale are inadequate to cover the special charge and delinquent taxes, the county may recognize a loss on the sale. WCEDA has had at least one request to explore this type of financing. If this is something that the committee would like to explore, we would need to draft an ordinance and develop program guidelines. An example of such guidelines can be found at the following link: GPROGRAMMANUALv5.pdf DAB/nh Enclosure

38 Updated Wis. Stats. Published and certified under s November 6, Updated Wis. Stats. (2) In addition to the provisions of any other statutes specifically authorizing cooperation between political subdivisions or public transit bodies, unless those statutes specifically exclude action under this section, any political subdivision or public transit body may, for mass transit purposes, issue bonds or, with any other political subdivision or public transit body, jointly issue bonds. History: 1991 a. 282; 1999 a. 150 s. 604; Stats s Special charges for current services and energy and water efficiency improvement loans. (1) In this section: (a) Energy efficiency improvement means an improvement to a residential, commercial, or industrial premises that reduces the usage of energy, or increases the efficiency of energy usage, at the premises. (b) Political subdivision means a city, village, town, or county. (c) Service includes snow and ice removal, weed elimination, street sprinkling, oiling and tarring, repair of sidewalks or curb and gutter, garbage and refuse disposal, recycling, storm water management, including construction of storm water management facilities, tree care, removal and disposition of dead animals under s (20), loan repayment under s (4) (b), soil conservation work under s , and snow removal under s (d) Water efficiency improvement means an improvement to a residential, commercial, or industrial premises that reduces the usage of water, or increases the efficiency of water usage, at the premises. (2) Except as provided in sub. (5), the governing body of a city, village or town may impose a special charge against real property for current services rendered by allocating all or part of the cost of the service to the property served. The authority under this section is in addition to any other method provided by law. (3) (a) Except as provided in par. (b), the governing body of the city, village or town may determine the manner of providing notice of a special charge. (b) Before a special charge for street tarring or the repair of sidewalks, curbs or gutters may be imposed, a public hearing shall be held by the governing body on whether the service in question will be funded in whole or in part by a special charge. Any interested person may testify at the hearing. Notice of the hearing shall be by class 1 notice under ch. 985, published at least 20 days before the hearing. A copy of the notice shall be mailed at least 10 days before the hearing to each interested person whose address is known or can be ascertained with reasonable diligence. The notice under this paragraph shall state the date, time and location of the hearing, the subject matter of the hearing and that any interested person may testify. (4) A special charge is not payable in installments. If a special charge is not paid within the time determined by the governing body, the special charge is delinquent. A delinquent special charge becomes a lien on the property against which it is imposed as of the date of delinquency. The delinquent special charge shall be included in the current or next tax roll for collection and settlement under ch. 74. (5) Except with respect to storm water management, including construction of storm water management facilities, no special charge may be imposed under this section to collect arrearages owed a municipal public utility. (6) If a special charge imposed under this section is held invalid because this section is found unconstitutional, the governing body may reassess the special charge under any applicable law. (7) Notwithstanding sub. (2), no political subdivision may enact an ordinance, or enforce an existing ordinance, that imposes a fee on the owner or occupant of property for a call for assistance MUNICIPAL LAW that is made by the owner or occupant requesting law enforcement services that relate to any of the following: (a) Domestic abuse, as defined in s (1) (am). (b) Sexual assault, as described under ss , , and (c) Stalking, as described in s (8) (a) A political subdivision may make a loan, or enter into an agreement regarding loan repayments to a 3rd party for owner arranged or lessee arranged financing, to an owner or lessee of a premises located in the political subdivision for making or installing an energy efficiency improvement, a water efficiency improvement, or a renewable resource application to the premises. If a political subdivision makes a loan or enters into an agreement under this paragraph, the political subdivision may collect the loan repayment as a special charge under this section. Notwithstanding sub. (4), a special charge imposed under this paragraph may be collected in installments and may be included in the current or next tax roll for collection and settlement under ch. 74 even if the special charge is not delinquent. (b) A political subdivision that imposes a special charge under par. (a) may permit special charge installments to be collected by a 3rd party that has provided financing for the improvement or application and may require that the 3rd party inform the political subdivision if a special charge installment is delinquent. (c) An installment payment authorized under par. (a) that is delinquent becomes a lien on the property that benefits from the improvement or application as of the date of delinquency. A lien under this paragraph has the same priority as a special assessment lien. (d) A political subdivision that, under par. (a), makes a loan to, or enters an agreement with, an owner for making or installing an improvement or application that costs $250,000 or more shall require the owner to obtain a written guarantee from the contractor or project engineer that the improvement or application will achieve a savings to investment ratio of greater than 1.0 and that the contract or engineer will annually pay the owner any shortfall in savings below this level. The political subdivision may determine the method by which a guarantee under this paragraph is enforced. (e) If the making or installing of an improvement or application under par. (a) costs less than $250,000, the political subdivision may require a 3rd party technical review of the projected savings of the improvement or application as a condition of making a loan or entering into an agreement under par. (a). History: 1999 a. 150; 2007 a. 4, 184; 2009 a. 11, 272; 2011 a A special assessment against a church was not barred by s (4). Grace Episcopal v. Madison, 129 Wis. 2d 331, 385 N.W.2d 200 (Ct. App. 1986). A city may impose special charges for delinquent electric bills due a municipal utility. Laskaris v. City of Wisconsin Dells, 131 Wis. 2d 525, 389 N.W.2d 67 (Ct. App. 1986). The cost of service to a property under this section does not include the cost of legal services incurred by the municipality in defending against challenges to the removal of materials from a ditch under s Robinson v. Town of Bristol, 2003 WI App 97, 264 Wis. 2d 318, 667 N.W.2d 14, The examples given in sub. (1) are not meant to limit its application in any way, but merely to highlight possible uses. The special charge need only provide a service, not a benefit, to the property owner. Under s (4) a special charge is a charge against real property to compensate for all or part of the costs to a public body of providing services to the property. Rusk v. City of Milwaukee, 2007 WI App 7, 298 Wis. 2d 407, 727 N.W.2d 358, State property is not subject to assessment of special charges under former s (16) [now s ]. 69 Atty. Gen Fees imposed by a political subdivision. (1) In this section: (a) Political subdivision means a city, village, town, or county. (b) Reasonable relationship means that the cost charged by a political subdivision for a service provided to a person may not exceed the political subdivision s reasonable direct costs that are associated with any activity undertaken by the political subdivision that is related to the fee Wisconsin Statutes updated through 2015 Wis. Act 64 and all Supreme Court Orders entered before November 6, Published and certified under s Changes effective after November 6, 2015 are designated by NOTES. (Published )

39 DRAFT Resolution No. **-12/15 Authorizing the Closure of the Project Account for the CTH X-Bridge Over WSOR RR Bridgework Project and Transferring Remaining Funds to the Road and Bridge Construction Committed Fund Balance Account Moved/Sponsored by: Public Works and Finance Committees WHEREAS, the County Trunk Highway (CTH) X bridgework project was funded by unassigned funds, tax levy and state funds; and, WHEREAS, the total County original and revised budget for this project was $324,100; and, Revised Project Budget Actual Lapsing CTH X-Bridge over WSOR Walworth County Cost $324,100 $ 265,081 $59,019 State of Wisconsin Cost $1,025,467 Total Cost $1,290,548 WHEREAS, all final bills have already been authorized for payment; and, WHEREAS, the total actual County funded project costs are $265,081, resulting in $59,019 in net savings; and, WHEREAS, the Walworth County Finance Committee requests to transfer the remaining project funds of $59,019 to the Road and Bridge Construction Committed fund balance account in the Capital Projects fund; and, NOW, THEREFORE, BE IT RESOLVED that the Walworth County Board of Supervisors authorizes the closure of the CTH X-Bridge over WSOR RR project and approves the transfer of the remaining project funds to the Road and Bridge Construction Committed fund balance Account in the Capital Projects fund account. BE IT FURTHER RESOLVED that the Walworth County Board of Supervisors authorizes the Finance Department to adjust the amount transferred to the Road and Bridge Construction Committed fund balance account in the Capital Projects fund balance for residual project invoices. Nancy Russell Kimberly S. Bushey County Board Chair County Clerk

40 1 2 3 County Board Meeting Date: December 8, 2015 Action Required: Majority Vote X Two-thirds Vote Other Policy and Fiscal Note is attached. Reviewed and approved pursuant to Section 2-91 of the Walworth County Code of Ordinances: David A. Bretl Date Nicole Andersen Date County Administrator/Corporation Counsel Deputy County Administrator - Finance If unsigned, exceptions shall be so noted by the County Administrator.

41 Policy and Fiscal Note Resolution No. **-12/15 I. Title: Authorizing the Closure of the Project Account for the CTH X-Bridge Over WSOR RR Bridgework Project and Transferring Remaining Funds to the Road and Bridge Construction Committed Fund Balance Account II. Purpose and Policy Impact Statement: The purpose of this resolution is to authorize the closing of the CTH X-Bridge over WSOR RR project. III. Budget and Fiscal Impact: This resolution will return $59,019 to the Road and Bridge Construction Committed fund balance account. IV. Referred to the following standing committees for consideration and date of referral: Committee: Public Works Meeting Date: November 16, 2015 Vote: Committee: Finance Meeting Date: November 19, 2015 Vote: County Board Meeting Date: December 8, 2015 Policy and fiscal note has been reviewed and approved as an accurate statement of the probable policy and fiscal impacts associated with passage of the attached resolution. David A. Bretl Date Nicole Andersen Date County Administrator/Corporation Counsel Deputy County Administrator - Finance

42 ORDINANCE NO. ** 12/15 DRAFT AMENDING SECTION OF THE WALWORTH COUNTY CODE OF ORDINANCES RELATING TO ROAD AND BRIDGE CONSTRUCTION COMMITTED FUND BALANCE THE WALWORTH COUNTY BOARD OF SUPERVISORS DOES ORDAIN AS FOLLOWS: PART I: That Section of the Walworth County Code of Ordinances is hereby amended to read as follows: 4 Sec Capital projects fund (e) The county board may commit funds for authorized purposes within the Capital Projects Fund. Only funds in excess of the fund balance categories established in section may be considered for commitment. The following categories of committed funds are allowed: (1) Road and bridge construction. This committed account shall be funded by lapsing road and bridge construction projects, transfers from public works unrestricted net assetsposition, or general fund unassigned fund balance as authorized by the county board. In lieu of other funding sources, these funds may be utilized to fund road and bridge construction, unanticipated or emergency road or bridge projects, or contingencies of existing road or bridge projects. Road and bridge construction projects may utilize these funds via established budget amendment guidelines or specific county board action. BE IT ORDAINED by the Walworth County Board of Supervisors that all previous ordinances and resolutions pertaining to Section are hereby superseded. BE IT FURTHER ORDAINED by the Walworth County Board of Supervisors that this Ordinance shall become effective upon passage and publication. PASSED and ADOPTED by the Walworth County Board of Supervisors this 8 th day of December, Nancy Russell Kimberly S. Bushey County Board Chair Attest: County Clerk County Board Meeting Date: December 8, 2015

43 Action Required: Majority Vote X Two-thirds Vote Other Policy and Fiscal Note is attached. Reviewed and approved pursuant to Section 2-91 of the Walworth County Code of Ordinances: David A. Bretl Date Nicole Andersen Date County Administrator/Corporation Counsel Deputy County Administrator - Finance If unsigned, exceptions shall be so noted by the County Administrator.

44 Ordinance No. ** - 12/15 Fiscal Note and Policy Impact Statement I. Title: Amending Section of the Walworth County Code of Ordinances Relating to Road and Bridge Construction Committed Fund Balance II. Purpose and Policy Impact Statement: This ordinance adjusts the current road construction committed account in the Capital Projects fund to specifically allow bridge construction to be considered an allowable usage of this account. III. Is this a budgeted item and what is its fiscal impact: This ordinance does not change the budget. The five year capital plan includes the use of this committed account for bridge construction. IV. Referred to the following standing committee(s) for consideration and date of referral: Committee: Finance Date: November 19, 2015 Vote: County Board Meeting Date: December 8, 2015 Policy and fiscal note has been reviewed and approved as an accurate statement of the probable policy and fiscal impacts associated with passage of the attached ordinance. David A. Bretl Date Nicole Andersen Date County Administrator/Corporation Counsel Deputy County Administrator - Finance

45 ORDINANCE NO. ** 12/15 DRAFT AMENDING SECTION OF THE WALWORTH COUNTY CODE OF ORDINANCES RELATING TO RETENTION SCHEDULE OF BONDS THE WALWORTH COUNTY BOARD OF SUPERVISORS DOES ORDAIN AS FOLLOWS: 1 PART I: That Section of the Walworth County Code of Ordinances is hereby 2 amended to read as follows: 3 4 Sec Retention schedule. 5 6 The following records shall be retained, pursuant to the following schedule and may, in accord 7 with the provisions of this division, be destroyed at the end of the retention period. Before 8 destruction, the regulations of this division must be observed. Any record not listed shall be kept 9 for a minimum of seven years (19) (20) Type of record Cancelled bonds, coupons and promissory notes Bond and coupon record book, general obligation bonds Retention Time County Clerk: EVTEvent + 4 years 7 years after bond issue expires or until payment of all outstanding matured bonds, notes or coupons, whichever is later As long as the bonds are outstanding, plus 3 years after final redemption date of the bonds Authority Section (d)(6)(iii)(E) of the arbitrage regulations Wisconsin Historical Society Notification Waived Waived BE IT ORDAINED by the Walworth County Board of Supervisors that all previous ordinances and resolutions pertaining to Section are hereby superseded. BE IT FURTHER ORDAINED by the Walworth County Board of Supervisors that this Ordinance shall become effective upon passage and publication.

46 PASSED and ADOPTED by the Walworth County Board of Supervisors this 8th day of December, Nancy Russell Kimberly S. Bushey County Board Chair Attest: County Clerk County Board Meeting Date: December 8, 2015 Action Required: Majority Vote x Two-thirds Vote Other Policy and Fiscal Note is attached. Reviewed and approved pursuant to Section 2-91 of the Walworth County Code of Ordinances: David A. Bretl Date Nicole Andersen Date County Administrator/Corporation Counsel Deputy County Administrator - Finance If unsigned, exceptions shall be so noted by the County Administrator.

47 Ordinance No. ** - 12/15 Fiscal Note and Policy Impact Statement I. Title: Amending Section of the Walworth County Code of Ordinances Relating to Retention Schedule of Bonds II. Purpose and Policy Impact Statement: This ordinance identifies the records retention requirements for bonds pursuant to the Internal Revenue Service s arbitrage regulations in Section (d)(6)(iii)(E). III. Is this a budgeted item and what is its fiscal impact: There is no fiscal impact. IV. Referred to the following standing committee(s) for consideration and date of referral: Committee: Finance Date: November 19, 2015 Vote: County Board Meeting Date: December 8, 2015 Policy and fiscal note has been reviewed and approved as an accurate statement of the probable policy and fiscal impacts associated with passage of the attached ordinance. David A. Bretl Date Nicole Andersen Date County Administrator/Corporation Counsel Deputy County Administrator - Finance

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