Fixed Term Automated
How to invest school funds in longer-term fixed income securities
-- safely and conveniently
The Fixed Term Automated (FTA) Investment Program from The Education Liquidity Fund (“TELF”) is designed to help Iowa schools invest public funds in longer-term fixed income securities which comply with Iowa State Code Section 12B.10. These securities include obligations issued or guaranteed by the U. S. Government, or agencies thereof, and Certificates of Deposit (CDs) issued by Iowa financial institutions. Securities purchased through the FTA Program bear fixed rates of interest and have fixed maturity dates.
The program, which is administered and advised by Miles Capital, enables participants to place funds in preauthorized Iowa financial institutions, while soliciting the most competitive rates within the state. In so doing, the program insures public fund reinvestment and aids in community growth.
Safety of principal
The maximum maturity of securities purchased through the program will not exceed 60 months. It is anticipated that most participants will hold FTA Program investments until maturity, thus reducing risks associated with market fluctuations and interest rate changes.
If a participant liquidates an FTA Program investment prior to maturity, loss of principal and, in the case of CDs, early redemption penalties, may be incurred. Such losses should be minimal due to the relative short maturity and high quality of the securities.
With a phone call, e-mail, or fax, participants can obtain a competitive rate with maturities of up to 60 months. Rates quoted will be net of all FTA Program expenses. The participant's account will be charged for securities purchased and credited with the proceeds when securities mature or are sold. Interest on the investment is credited directly to the participant’s account. Some FTA placement yields are included below.
Maximum yields, maximum protection
Miles Capital will regularly contact and solicit bids on the participant’s behalf from approved Iowa financial institutions which satisfy the firm’s credit screening process. Miles Capital seeks to determine the highest rates currently being paid on CDs, based on the credit worthiness of the banks and their ability to properly collateralize.
Investing bond proceeds
When you provide a cash flow projection of anticipated expenditures for a construction project, Miles Capital can deliver a quote for a collateralized Flex-CD issued by an Iowa financial institution. A Flex-CD can provide several advantages, including:
- payment of a fixed rate of interest for the life of the instrument;
- a maturity date extending six months beyond the anticipated project completion date to allow for
unanticipated project delays; and
- the ability to withdraw funds once a month – without penalty – to pay project costs as they are incurred.
How to put the IPASeducation FTA Investment Program
to work for your school district
To purchase investments through the FTA Program, simply contact Miles Capital, toll free at (866) 720-2995. You’ll be advised of approved securities which provide competitive returns, as well as the current rate of your desired investment. Investments purchased under the FTA Program will be held by the program’s custodian for the benefit of the participant. Interest earned on investments held for participants, as well as proceeds upon maturity, will be automatically collected by the program’s custodian and credited to the participant.
Miles Capital collects a portion of the interest paid to operate the FTA program. All CD rates are quoted net of fees, and fees are paid at the time of interest receipt on all FTA program investments.
Historical Investment Information
Please Note: This history of investment information will allow you to compare investments that your public agency may have placed over the past three months to those rates that were available through the cash management program during that period. Rates of investment for actual public funds investments placed are illustrated below.
Each investment was for the type of security and amount shown on the respective investment date indicated. Rates represent actual investments placed and are provided for comparative purposes only.
When comparing rates, always try to select an investment for comparison that was placed as close in time as possible to the investment you wish to compare and whose period to maturity (Average Life) is comparable.
Since available market rates change over time, to determine rates for any funds currently available for investment, please contact your TELF representative.
Toll free at 1-866-720-2995
Toll free fax at 1-866-260-0246
Thank you for your interest.