Great visit to N Ridgeville schools who invested $9M in STAR Plus program. Andrea Vance is a hard-working principal! pic.twitter.com/7ZCvEkeDtl— Josh Mandel (@JoshMandelOhio) August 28, 2013
NORTH RIDGEVILLE – Earlier this month the city’s school district began to make use of a revised state program that enables schools, cities and other governmental subdivisions to invest tax money for higher rates of return.
The district began to make use of the revamped STAR Plus program Aug. 15 when Treasurer Biagio Sidoti made a $1 million deposit, which was followed Aug. 20 with a deposit of $8 million.
The $9 million total investment includes more than $4.3 million from revenue generated through local property tax collections from the passage of a 5.9-mill, 10-year operating levy last November, Sidoti said.
The school system collects just over $2 million in tax revenue from the levy each February and August.
School officials discussed merits of the program with State Treasurer John Mandel Wednesday during one of many stops Mandel is making across the state to tout the effort, which alters the 1985 STAR Ohio program by way of an Ohio House Bill passed by the state legislature in 2011.
Billed as the first of its kind in the nation, the Star Plus program has seen investment of just over $1 billion by 300-plus Ohio school districts, cities, park systems, libraries and other governmental subdivisions.
Of that number, the vast majority-- 125 -- are school districts, according to data provided by the state treasurer’s office.
Superintendent Jim Powell thanked Mandel for revising the STAR Plus program to allow for “alternative means to invest.”
“This is a great vehicle to park our money in to get a little better rate of return,” Sidoti said.
The revamped program is designed to help answer complaints by many in local government that local funds were being invested outside of the communities producing the tax revenue, Mandel said. The program sees community-based banks compete for investments.
“This is a means of helping keep local tax money local,” Mandel said.
Under terms of the program, North Ridgeville Schools have access to invested funds at any time to meet needs including bi-weekly payroll, Sidoti said.
One big advantage of the program is the safety of school funds, which are insured by the Federal Deposit Insurance Corp. up to the $250,000 limit placed on deposits for the STAR program to any financial institution, Sidoti said.
When the STAR program first began in 1985, it did not offer FDIC guarantees for invested money.
Another plus of the program, according to Sidoti, is the increased odds of getting a higher rate of return on deposited money, which is locked into weekly rather than daily rates, as was the case under the old STAR program, Sidoti said.
“Originally interest rates could have changed every day,” Sidoti said.
The revamped program is providing yields on investments that are four times greater than those offered under the program’s original version, according to Mandel.
In Lorain County, some $30.7 million has been invested with the STAR Plus program, with Lorain County Community College ($15 million), the city of Lorain ($8 million), Vermilion Schools ($7.5 million), and the city of Elyria ($2.7 million) being the biggest participants.
Mandel made no reference to recent news stories detailing two traffic accidents he was involved in but had not made public.
The most recent occurred in March in downtown Toledo in which Mandel was riding in a vehicle owned by his 2012 U.S. Senate campaign, which the Republican lost to Democratic incumbent Sherrod Brown.
An earlier accident in April 2011 occurred in downtown Columbus.
Because Mandel has chosen not to use state-provided transportation for official business, ostensibly to save taxpayer money, he is not required to make formal reports of such incidents.
Contact Steve Fogarty at 329-7146 or email@example.com.