Little Elm earned $6.68 million in interest on its cash and investments in the fiscal year that ended Sept. 30, about $1.68 million less than the year before, according to a quarterly investment report on the Town Council's consent agenda for Tuesday, Nov. 3.
The 20.1% drop is mainly the result of lower investment yields, the finance staff wrote. The portfolio's yield to maturity at cost was 3.91% at the end of September. For comparison, the report uses the latest figure it has from the previous year, 4.49% as of June 30, 2025, and explains why: no investment report was prepared for Sept. 30, 2025.
Where the money sits
The town held $177.2 million in cash and investments on Sept. 30. That was $13 million, or 6.84%, less than at the end of June. Staff attribute the decline mostly to large scheduled debt payments in August, along with normal operating and capital spending, and say it does not reflect investment losses.
About half the money, $89.3 million, was in pooled money market investments. The rest was split among U.S. Treasury notes ($34.9 million), negotiable certificates of deposit ($22 million), U.S. agency bonds ($17.4 million) and bank accounts ($13.5 million). Interest for the July-to-September quarter alone came to about $1.42 million.
The report compares the portfolio with the one-year Treasury yield, 4.54% on Sept. 30, because the town's average investment matures in 399 days. The town's yield ran 0.63 percentage points below that benchmark, which staff say reflects how much cash it keeps in highly liquid accounts to cover operating and construction bills.
The average maturity is within the two-year limit in the town's investment policy, and the report states that the portfolio complies with that policy and the state Public Funds Investment Act. It is signed by the assistant finance director, who is also serving as interim finance director, and the accounting manager.
