North Penn talks, then tables, outside investment advisor

Could an outside firm help the North Penn School District find new revenue by better managing reserve funds?

That’s the idea behind talks taken up by the board’s finance committee this week, after hearing a proposal from an outside firm seeking to do so.

“Because of the way we earn our revenues, so much of it being up front with real estate taxes, we sit on a ton of cash for six months of the year as we use it,” said district CFO Tara Houser.

“At some points, we have over $200 million in cash, just sitting in the bank,” she said.

Each year the board, staff and department heads hold a series of budget meetings through the spring, then vote to advertise a roughly $300-plus-million preliminary budget and tax rate in May, adopt it in June, then tax bills are issued July 1 and board members hear monthly reports on tax receipts and outgoing expenses, a process Houser compared to a household being paid on a similar schedule.

“It’s kind of like you get paid once a year, and then you use it all year long, and then you get paid again in July and August,” she said.

Those funds currently are held in funds at local banks and transfers and investments are overseen by the business office, Houser told the board during the first finance committee meeting of the year on Jan. 6, but talks with counterparts in other nearby districts have centered on another option: Could an outside firm better manage those funds and find higher interest rates than those offered by local banks?

“There are very strict rules on how we can invest our funding. [Certificates of Deposit] are something that we’re allowed to use, but you can only go up to $249,000, which is a lot of CDs if you have $220 million sitting in the bank,” Houser said.

Enter the outside firm: Neighboring districts who are also part of the Montgomery County Intermediate Unit have recently shared how they work with Cornerstone Financial Management to oversee investments and cash management, streamline banking, and increase returns.

“My first two months here, I probably had nine banks approach me about holding our funds. I really wanted an unbiased, third party, to help me look at how we’re managing our cash,” Houser said. “They’re independent from any bank, and from any investment source. It’s not a bank, trying to sell me a bank product.”    

Senior consultant Amanda Kesler and investment manager Whitney Bates from Bethlehem-based Cornerstone then outlined for the committee how their employee-owned firm works with several other districts in Montgomery County, with a $100,000 first-year fee based on that firm analyzing all district investments and developing an investment strategy, then finding options the district staff would vet before proceeding.

“We will work with any money manager. We have no bias, no custodial products. We don’t offer you any sort of products that we get paid on. We are able to come to Tara and say ‘This is the best place to put your cash for the next six months, at this rate,’ without any bias on our part,” Kesler said.

In consultation with staff, the firm would develop an investment strategy based on a mixture of safety, liquidity, and yield, analyze the district’s current investments and any collateral behind them, and detail when the district would need cash for known expenses such as salaries or debt payments.

“Once we know you have the liquidity that you need, then it’s our job to optimize the yield that you’re getting on those investments,” Kesler said.

Cornerstone monitors market interest rates and developments daily, Bates added, and could help the district strategize on how to invest short-term against long-term, and schedule investments around the local calendar such as the district’s budget schedule, and any market events such as anticipated Federal Reserve interest rate cuts. As of September 30, 2025, the district currently holds roughly $279 million in various funds, of which roughly $258 million in day-to-day revenue is held in local banks, just shy of $18 million in money market accounts, and the remaining $3.2 million in individual securities seeking higher rates.

Board member Christine Coyne asked if such an outside firm could be “RFP-able” and staff could seek quotes from multiple such companies; Houser said they could, but most tend to be affiliated with financial institutions, and could come with conflicts; others may not be local.

Board President Juliane Ramic asked if tabling a recommendation from the finance committee now would impact the timeline of hiring such a firm, and Houser said doing so and proceeding with an RFP would likely mean they would not be in place for the start of the 2026-27 budget year in July.

The board voted six-to-three to table and develop an RFP instead, with Bell, Ramic and finance committee chair Kunbi Rudnick casting votes against tabling.

North Penn’s school board next meets at 7 p.m. on Jan. 22 and the finance committee next meets at 6 p.m. on Feb. 3; for more information visit www.NPenn.org.

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