LOCAL GOVERNMENT INVESTMENT POOLS
The Arizona State Treasurer’s Office operates four Local Government Investment Pools, which are voluntary investment vehicles operated by the Investment Management Division. More than 150 local governments have participated since the first LGIP pool began in 1980 to provide safe, liquid, and competitive yields for local government entities.
LGIP Pool 5 is similar to a short term money market fund and invests in government securities, certificates of deposit, commercial paper of companies, and other highly liquid and low-risk securities.
The second pool, the LGIP-GOV Pool 7, began in 1995 is established under the same administrative rules as the LGIP except that pool investments are limited to those securities that carry the full faith and credit of the United States government.
The LGIP lets local governments use the State Treasurer’s resources to safely invest their funds while enjoying the economies of scale available from a $2.5 billion pooled fund investment portfolio.
The office also offers medium-term LGIP Pools with floating Net Asset Values for those clients with a longer term investment horizon than the money-market type Pools 5 and 7. These two medium-term funds, Pools 500 and 700 invested in similar securities as in Pools 5 and 7, but with longer maturities.
LGIP offers 100% liquidity to its participants
LGIP’s investment objectives are:
- Safety of principal
- Maintaining adequate liquidity to meet cash flows
- Providing a competitive interest rate relative to other comparable investment alternatives
Local governments that are eligible to join are: cities and towns, counties, special taxing districts, municipal corporations, community and technical colleges, and four-year universities. Today LGIP Participants include:
- 82 Cities & Towns
- 48 Special Taxing Districts
- 11 Counties
- 7 Community Colleges & Universities
- 5 State Agencies
- State Operating Fund