PROVIDENCE, R.I. – General Treasurer Gina M. Raimondo today praised the General Assembly for passing legislation creating a local government investment pool (LGIP).
The LGIP, one of Raimondo’s top legislative priorities, will help the state and municipalities better manage and improve the investment performance of their short-term liquid assets.
Short-term liquid assets are used by the state, cities and towns for day-to-day operations, such as payroll, operating expenses and capital projects.
“I would like to thank the members of the House and Senate for passing legislation that will help government leaders across the state invest and grow their assets,” Raimondo said. “Treasury is always looking to improve investment performance for the cash assets managed by the state. The LGIP model will allow my office to extend this improved level of performance to cities and towns that may not have the staff or resources to dedicate to monitoring, managing and growing short-term investments.”
This voluntary initiative will be a safe, liquid, convenient and low-cost investment vehicle. Treasury estimates that across state and municipal governments, there is more than $500 million in funds that could be appropriately invested in this vehicle. If the fund is able to enhance returns by just two-tenths of one percent, that could mean $10 million to $15 million in new potential revenue to participants over a 10-year horizon. Approximately 44 out of 50 states operate some form of LGIP.
In the House, H.5585 was sponsored by Majority Leader Nicholas Mattiello (Cranston), Rep. Lisa Tomasso (Coventry and West Warwick), Rep. Jon Brien (Woonsocket), Rep. Michael Marcello (Scituate and Cranston) and Rep. Joy Hearn (Barrington and East Providence). In the Senate, Senator Walter Felag (Bristol, Tiverton, Warren) sponsored S.0858.