You Are Going to Need a Better Crystal Ball

You Are Going to Need a Better Crystal Ball

Pathway to Recovery® Series
A Better Crystal Ball

If you are a public sector budget officer, then this year you are going to need a better crystal ball. We can help with that.

I can appreciate the anxiety that municipal budget officers are feeling right now. Even in the best of times, putting together a spending plan for your organization that incorporates and addresses all of the “what ifs” that can happen between now and December 31st of the following year can be a daunting task. And the autumn of 2020 is definitely NOT the best of times.

I served as a budget officer for a small-to-medium size county in upstate New York for 18 years, and I had to deal with my share of challenges. In addition to the standard annual struggle to hold the line on property taxes while still providing much-needed services to the public, my rural community was still coming back from the economic impacts of the Great Recession when we were hit with historic flooding that swept through our scenic valley in 2011. Businesses closed, sales tax revenues fell, and some houses remained vacant and abandoned.

cashvest® by three+one® is like using a crystal ball for your entity’s finances

Covid-19 has presented us with challenges that none of us have ever seen before. There are many unanswered questions swirling about which compound the difficulty of making revenue projections for the coming year. Will Congress approve more federal aid to states and local governments? Will every municipality receive a fair and direct share of that desperately needed aid, regardless of the size of their population? Will the coronavirus be contained over the next two or three quarters, or will there be a second wave that could result in yet another blow to businesses struggling to survive?

Here at three+one®, we provide our clients with liquidity data and cash-flow projections that can help bring the financial picture into a sharper focus. We do this by equipping our clients with a broad range of financial technology tools. These can include our patented cashvest® liquidity monitoring and cash management system; access to our MC Forecast® cash-flow modeling tool which provides accurate, reliable data about what your municipality’s or higher-Ed institution’s cash position will be 6, 12, and even 18 months from now; and the option of utilizing our innovative rfpPrep® software that makes it easier than ever before to compare banking services and procure the best-performing and lowest-cost options that fit your particular needs.

The timing is perfect right now because besides providing you with a much clearer view of what your financial picture will look like over the next several quarters, three+one will also help you to immediately begin achieving real, significant financial benefits that can be incorporated into your 2021 budget. These include:

  • Increased interest earnings by helping you put every available dollar to work—and extending the timeline that you can lock in the interest.
  • Savings on bank fees by helping you to consolidate under-utilized accounts and embrace new banking technology measures that can help combat fraud.
  • Our liquidity data can help reduce the number of times you have to borrow for short-term cash-flow needs; that means lower debt service.
  • Higher credit ratings based upon the extensive liquidity data we provide can result in lower interest rates when you do have to borrow money.

Why not give three+one® a call? Our team of experienced financial professionals will be happy to help you polish up that crystal ball of yours and assist you in getting a more accurate picture of what the future holds.

The author served for a total of 38 years in local government at the village, town, and county levels, including 18 years as a county Budget Officer and eight years as a Disaster Recovery Coordinator. As Director of Public Partnerships for three+one®, he can be reached at 585-484-0311 or by email at:


The 20% Rule

The 20% Rule

Pathway to Recovery® Series
The 20% Rule

“Even if only 20% of the bones in your body were broken, you would still feel 100% miserable.”

Sometimes, 20% is a lot. Like when you are in pain. It can be a significant number in other situations as well. Imagine if 20% of the fuel in your car’s gas tank was mostly water. Or how you would feel if 20% of the food you ate for dinner was tainted.

Likewise, our economy cannot fully recover from COVID-19 if a substantial 20% segment of our nation’s economic engines are stalled and sputtering. That’s the percentage of our nation’s overall economic activity that is generated by state and local governments. The federal government is responsible for another 20%, and the remaining 60% of GDP is created by the private sector.

three+one economic pathway to recovery The total annual Gross Domestic Product of the U.S. is about $20 trillion.  That figure includes every segment of the economy—private industry, manufacturing, energy, government—from the hot dog vendor on the curb, to the boardrooms of the biggest corporations, to your local library. To put things into perspective, the largest U.S. manufacturing business is the automobile industry. The total economic output of the entire American vehicle production industry—including every car and truck manufacturer, and every parts supplier—is less than $1 trillion. That’s about 3% of the total U.S. economy.

By contrast, spending by city and county governments on goods and services equals just over $2 trillion per year (about 10% of the nation’s total GDP). And state governments add another $2 trillion per year (an additional 10%). Which means that state and local governments are responsible for a remarkable 20% of our nation’s total economic activity! The federal government spends about the same amount as state and local governments do combined, so the total impact of public-sector spending on necessary goods and services equates to fully 40% of our country’s GDP.

This massive government spending isn’t wasteful—it is vital to our economy and to our quality of life. Some examples might include building and maintaining roads and bridges so that interstate commerce can take place; operating hospitals and public health services to keep our families healthy; providing police and law enforcement to keep our communities safe; creating school systems to educate our children; operating colleges and universities to prepare the leaders of the next generation.  The list could go on and on to include fire protection in our communities; clean drinking water; parks and recreation; courts and the legal system; and human-services programs. You get the idea.

Government services—and government spending—is the enormous mainsail that propels America’s “ship of state” forward. Its huge 40% share is by far the biggest and most influential and impactful segment of our national economy, accounting for more than $9 trillion of our $20 trillion GDP. State and local governments combined account for half of that 40% share, so they play a major role in determining whether the economy is healthy. Or sick.

Which brings us back to why the federal government will be shooting itself in the foot if Congress stands by and watches as state and local governments struggle to deal with the revenue shortfalls brought about by COVID-19. These temporary revenue shortfalls are not anyone’s fault. They are not based on political party affiliation.  The coronavirus did this to all of us! Counties and cities didn’t bring this crisis upon themselves through wasteful spending or careless fiduciary policies. Quite the opposite. Local governments are, by and large, cost efficient, frugal, and the most responsible providers of critically important public services. After all, the people serving in those municipalities pay taxes too!

We all want to see the federal government act responsibly with our tax dollars. But providing direct aid to state and local governments is not frivolous. On the contrary, it is far and away the best pathway forward for our nation to make it through this economic crisis relatively unscathed. As I noted above, state and local governments make up 20% of our GDP. If they become crippled by budget crises, then they will have no choice but to eliminate services and cut spending. That will lead to higher unemployment, even lower tax revenues, and a downward spiral that will impact every segment of the American economy. It could take years, and even decades, to pull out of that kind of a tailspin.

three+one liquidity managementThe issues may be complicated, but the solution is clear. The best way to keep COVID-19 from derailing the entire economy of the United States of America is for the federal government to use its massive financial might to keep state and local governments afloat.

After all, even if only 20% of your bones are broken, you still feel 100% miserable.

The author served for a total of 38 years in local government at the village, town, and county levels, including 24 years as a County Treasurer/CFO and 9 years as a Disaster Recovery Coordinator.  As Director of Public Partnerships for three+one, he can be reached at 585-484-0311 or by email at:

What Now?

What Now?

It’s confusing…will schools reopen for in-person learning, be online, or opt for a hybrid model?  No matter how much planning can or has been done over the summer, the outcome of “what’s around the corner?” has everyone wondering. This is when the patience of Job is going to really be tested. In addition, the impact of enrollment for higher Ed institutions is yet to be determined so late in the registration cycle. What all institutions are experiencing is unprecedented, and the impact will not only influence the 2020/2021 school year but many years in the future.

As students and parents determine the value of on-campus/in-person learning vs. online classes, the financial implications have rippling effects. While most think online learning provides institutions with a higher profit margin, the loss of room and board, facility rental, and bookstore revenue is significant, becoming major challenges now and in the future. This does not just apply to four-year institutions and graduate schools, but also to community colleges.

It’s interesting that the percentage of students that prefer in-person learning has not changed as a result of COVID-19; it remains steady at over 70%. While most students are open to some level of online learning, there is naturally a strong desire to socially interact with others. They see that as a key component of campus life. This is why most higher Ed institutions are pressing for a hybrid model, combining both in-person and online classes (if not prohibited by state guidelines). It should also be noted that once a decision is made, unsafe student behavior and other events may cause institutions to alter their plans. Over the past week alone, we’ve already seen a number of schools close their campuses due to a spike in positive coronavirus cases.

As higher Ed administrators look to understand all the implications, three+one®’s MC forecast model® is becoming a very valuable tool for them in determining short-term liquidity levels and needs. While historical data is used to determine future patterns, potential implications of the “unexpected or anomalies” can be incorporated to determine possible scenarios over the coming months. This information can be found to be extremely useful in evaluating the impact on cash reserve funds or the need to tap into lending facilities or potential emergency endowment funds.

COVID-19 poses challenges for every single public entity and higher Ed institution. Just know that three+one® is by your side to help you answer the question “What now?”

Grab an Oar and Pull

Grab an Oar and Pull

Pathway to Recovery® Series
Because we’re all in the same boat now.

Rowing a boat takes teamwork, especially during a storm. It requires people working together towards a common goal. If half of the rowers are determined to head north, while the other half are just as resolved to head south, nothing gets accomplished—no forward progress is made, and the boat will never reach the safe haven of land.  

COVID-19 is very likely to be the storm of our lifetime. It’s too early to say for sure, but there is some chance that history will describe it as our “Storm of the Century”.  Either way, it is a tempest that is rocking the very foundations of our economy and our society. We are all sitting together in a lifeboat now, heaving and swaying as the storm rages around us. And we all have a responsibility to grab an oar and do our part to help our neighbors and ourselves if we’re going to make it safely to shore. We have much to be thankful for—our “ship” is sound and our backs are strong—and we have a common goal.

We must recognize that there are a huge number of heroes who are already pulling with all their might on their oars, and trying their very best to keep us alive. They are our nation’s healthcare workers, medical professionals, public health officials, and emergency responders. They are straining and struggling, putting their very lives on the line for us and our families, day in and day out.  Their hands are blistered and their muscles are weary, and it is our duty and responsibility to man our own oars to try to take some of the burden off their shoulders.

three+one liquidity analysisSome oars are more powerful than others and the rowers who hold them can make enormous contributions to the success of our journey. Members of Congress must put aside their political differences and pull together as one to help us make it safely through this storm. We need them to recognize that when one side of the boat rows in one direction and the other side rows in the opposite direction, the ship is dead in the water.

One thing that everyone should be able to agree on is that local governments are going to need substantial financial assistance during this pandemic if we are to have any chance at all of a really full recovery within a reasonable time period.  

As a former disaster recovery coordinator for a county in upstate New York, I saw firsthand just how critical federal funding is to a community that is struggling to get back on its feet in the aftermath of a natural disaster. With significant federal help (in our case, almost $100 million), it still took my community almost 10 years to recover from a devastating flood. WITHOUT any federal assistance??  We would still be running county offices from rented garages and using second-hand folding tables as desks. We would also be driving our local government deeper and deeper into debt as we tried to deliver necessary services such as law enforcement, road and bridge repairs, and public health. And trying to do all that with a taxpayer base that was already tapped out. Our boat would be leaking, foundering, and in serious danger of actually sinking.

We at three+one® are also doing our part to pull on the oars.  We help local governments make the most of what they have, so they can collect that much less from the taxpayers. We provide data and financial forecasts on the funds that a county or municipality has on deposit. That information gives them the opportunity to maximize the value of that cash.  For example, New York’s Orange County has been using our liquidity analysis services since 2018. Last year they earned $2.0 million MORE than similar-sized counties! That represents $2.0 million of public services and infrastructure improvements that did not have to be paid for by their taxpayers.  Another great example is Lehigh County, Pennsylvania.  They earned about $489,000 annually in interest before partnering with three+one® in 2017.  Last year Lehigh County earned more than $2.0 million in interest on their available cash – despite the fact that interest rates have actually gone down!

Each and every one of us can make our own contributions to help our communities and our nation make their way through this disaster. Though we must certainly address the public health crisis of COVID-19, we must also address the financial aftermaths that this pandemic will surely have on our society over the next several years. It is critically important that local governments receive direct federal funding now—before it’s too late—if necessary public services are to be delivered without interruption.

After all, we are all in this same boat together. It will take the willingness of each and every one of us to grab ahold of an oar, plant our feet firmly on the deck, and then do our best to pull in the same direction as the person in front of us and the person behind us. Our journey will be challenging, full of surprises, and potentially dangerous. But in the end, if we can all just keep the distant shoreline in sight and pull together towards a common goal, we can and will make it through this storm.

The team at three+one® is proud to partner with NACo as we jointly assist the nation’s county governments during these challenging times. To learn more about NACo and how it works with three+one® to develop financially sound solutions, contact Kyle Cline at or by phone at (317) 502-7415).

Despite Job Title, You’re Already Acting Like a CFO

Despite Job Title, You’re Already Acting Like a CFO

If you are reading this, you are probably already an experienced professional who is respected in your field. Your expertise may be in business management, marketing and sales, law enforcement, health care, insurance, construction, public services, or any of a dozen other professions. But what you may not know is that in many ways, you are also an experienced “Chief Financial Officer” in your own right and you are likely employing many of the tools used by the best professional CFOs.

My personal field of expertise is in Public Administration, specializing in government finances. For 24 years, I served as the elected Treasurer of Schoharie County, a rural municipality in upstate New York with about 32,000 residents. As the county’s CFO, I oversaw an annual operating budget of about $80 million and my fiduciary responsibilities included cash management, budgeting, liquidity analysis, investing of funds, future financial projections, and fraud prevention.

You may not realize it, but you are probably performing every one of these functions on a daily basis as well. Do you log on to your bank account on a regular basis in order to check your balances and look at recent payments to protect yourself against fraud or identity theft? If so, you are using “liquidity analysis” as a tool in fraud prevention.

When you log on and check those bank balances as you are drinking your morning coffee, do you also calculate in your mind whether you have sufficient funds available for upcoming recurring expenses such as mortgage payments, car loans, or other regular disbursements? If so, you are doing “cash management” combined with “future financial projections.”

If you are considering refinancing your mortgage or consolidating other debt, then knowing your precise cash position and effectively managing that cash can be very beneficial in helping you earn the highest credit ratings and the lowest loan rates.

Having a clear picture of your cash position can also be an important tool in helping you (or your public entity or higher Ed institution) be prepared for an emergency or unexpected fiscal crunch.

And if your prudent fiscal management has resulted in a larger cash balance in your low-or-no interest checking account than you really need at the moment, you will probably consider shifting some portion of those funds into a money market account—or maybe a CD—in order to earn higher interest. You have now successfully combined “liquidity analysis” with “future financial projections” and “investing of funds.” Congratulations! You are using the data, information, and tools of a Chief Financial Officer.

At three+one®, we help county governments and other public entities use the best resources available to manage their cash effectively. Our patented cashvest® system accurately monitors a public entity’s liquidity and provides it with the tools and technology needed to most effectively manage the funds that flow both into and out of its numerous bank accounts on a day-to-day basis. We provide our clients with objective, analytical, and accurate financial data that helps them use their resources to the very best advantage, thus maximizing their returns.

In our daily lives, most of us already practice the key elements of being an effective chief financial officer, no matter what our actual job title is. As it turns out, you probably already employ tools like “liquidity analysis,” “cash management,” and “financial projections” with your family’s finances. And it all starts out with that quick, but very effective, glance at your personal bank balances.

Having access to key data about current liquidity is critical to every facet of financial management. It is the starting point for cash control, financial projections, fraud prevention, and effective investing of funds. When you do those things on a personal level, with only one or two bank accounts to deal with, the process is fairly straightforward. But when you are the CFO of a large public entity or higher Ed institution, it gets much more complicated.

That’s where three+one® comes in.

Dealing with dozens of bank accounts, separate highway and general funds, enterprise funds, reserve accounts, debt-service funds, and the millions (or even tens of millions) of dollars that flow through those accounts every day can be a real challenge. The first key component is knowing exactly how much cash you have on deposit, and where those funds are—that’s liquidity analysis—and here at three+one®, that is precisely what we do. We can help you get a clear, detailed picture of the public funds that you manage, just like the one you have for your personal finances. Regardless of whether interest rates are rising or falling, we can provide you with the tools and data you need to best manage those funds.

We serve large and medium-sized public entities throughout New York State as well as in many other states nationwide. If you are a manager of public funds, please give us a call. We are sure that you will be satisfied with the results.

The author served as a county legislator, a county treasurer, and as a disaster recovery coordinator in New York State and has always strived to maximize the impact of federal and state monies at the local level.

The New Normal

The New Normal

The marketplace is evolving beyond our imagination. At the same time, data are moving beyond the speed of light eight times over, and how we manage that data is up to us.

Today, there are over 4.5 billion Internet users. Just consider that every minute:

  • 300 hours of video are being created
  • 510,000 Facebook comments are made
  • 4.4 million Facebook “like” clicks occur
  • 3.5 billion Google searches are made
  • 100 million messages are sent
  • 1.2 million new data points are created
  • 21.9 billion text messages are sent

Mobile phone usage is exploding and it’s just beginning. Over 65% of all emails are read on mobile devices with usage up 83% over 2018.

The way we communicate is changing and COVID-19 is just the start. Now, what is considered personal interaction is an online Zoom session. Keep in mind that people trust technology over people—but people trust technology supported by people even more.

Human interaction is the critical key in providing confidence and comfort, despite the constant advances being made in technology. This has become even more apparent as we have all had to learn to work remotely over the last several months.

FinTech by cashvestThe way you and a finance office will deal with the public, your banks, and cash will continue to change. The power of technology feeds data; that will lead you to new efficiency, savings, doing more with less, and providing new sources of revenue.

As we talk about the evolution of technology and communication, let’s also talk about the evolution of interest rates. Who would have guessed rates would be as low as they are right now? Even so, that doesn’t mean you can’t make money on your cash in today’s marketplace.  

First, you have to use the data that are right at your fingertips. Solid, usable data will allow you to capture all the information you need to have a holistic picture of (1) what cash you have available; (2) what you need and when you need it; and (3) the time horizon on cash for investing and its actual value in the marketplace.

The power of data will lead you to develop a liquidity analysis. Keep in mind that cash flow is the flow of cash you see over the course of time: the ebbs and flows on a weekly, monthly, and annual basis.

Liquidity is composed of each cash transaction between you and your financial institutions. The actual flow of cash from the time you need it, when it actually goes out the door, and the time it takes for the transaction to be processed are critical data points.

The power of liquidity will allow the past to lead you to more accurately charting the future. Be mindful that liquidity data will highlight behaviors that will repeat patterns that determine the outcome.

The benefits of proper liquidity management will lead to the following:

  • Determining how much cash you have and the level of cash needed to borrow for immediate needs. You’ll be able to see the whole picture during certain periods of time.
  • The potential to enhance your credit rating
  • Determining all levels of cash and being assured that all cash is seen as an asset. You’ll have a full picture of all dollars and the level of stresses on your cash during certain time periods.
  • Monitoring all bank fees.
  • Greater peace of mind during times of local, state, and/or national emergencies

Even in today’s marketplace, there are options to put cash to work. From state pools to bank deposits, money market funds to municipal bonds, government securities to CD products—they’re all being offered by the big banks to local community banks.

It’s good to know that there is no one product that fits all cash. Please do not fall for that fallacy. Cash has behaviors that need to be identified and treated accordingly. It’s your fiduciary obligation to those your serve to actively manage all your cash. You should never consider cash to be a passive asset.

Banking TechnologyJust as the marketplace for cash is changing, so too is the marketplace for banking. As I wrote in several blogs over the last few years, the transition from a bank branch to mobile banking was going to evolve. New technologies have led us to be served predominately over a computer rather than at the counter of a bank branch. Little did we know that it would take a pandemic to have one realize just how much of a reality remote working and banking would become.

Clearly, the world is changing for all of us. It’s up to each of us to grab what is in front us and seize the opportunity. In doing so, your office will be better prepared for whatever challenge awaits.

Those we serve deserve our moving with them as the marketplace continues to evolve into “a new normal.”