08/13/2019

Aquila Three Peaks Opportunity Growth Fund Recognized as a Category King

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Aquila Three Peaks Opportunity Growth Fund, was included in a Wall Street Journal Category Kings report for the year-to-date period ending July 31, 2019. The Category Kings report recognizes the top performing funds, based on total return, in 10 Lipper categories for the year-to-date period. Aquila Three Peaks Opportunity Growth Fund Class Y (ATGYX) was listed at #3 in the Lipper Mid Cap Core equity category, out of 381 funds. During this period, the Fund generated a return of 26.7% compared to the Lipper Mid Cap Core category average of 19.6% and the Russell 3000 Index return of 20.48%. The Fund was also listed as a Category King in May; falling in second place in the Mid Cap Core category based on the year-to-date return through May 31, 2019.
Read more “Aquila Three Peaks Opportunity Growth Fund Recognized as a Category King”

07/26/2019

Kentucky Legislature Ends Special Session with a Pension Bill

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The Kentucky Legislature ended their July special session Wednesday with a pension bill signed into law, effectively taking small steps toward solving the state’s hefty pension crisis. The bill narrowly passed in the house earlier in the week, but won by a wide margin in the senate on Wednesday. The bill’s objective is to relieve regional universities and quasi-governmental entities from large increases in pension costs that were handed down July 1, 2019.

As Governor Bevin stated in his press conference, the measure will not eliminate pension benefits for workers. It is designed to encourage agencies that exit the system to cap employees’ benefits and move them into 401k-type plans going forward. Although small, we see this as a positive step that will likely lead to more successful legislative solutions down the road.

With the Churchill Tax-Free Fund of Kentucky, we maintain our objective of managing interest rate risk and credit risk while keeping over 90% of the portfolio rated A or higher. We believe that one of the benefits of owning shares in the Fund is having the resources of local portfolio management and credit analysis. We will be monitoring the progress of pension reform in the state, along with the local economic and political environment.

Before investing in one of the Aquila Group of Funds, carefully read about and consider the investment objectives, risks, charges, expenses, and other information found in the Fund prospectus. The prospectus is available on this site, from your financial advisor, or by calling 800-437-1020.

06/19/2019

Sandy Rufenacht on Money Life with Chuck Jaffe

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On June 6, 2019, Sandy Rufenacht, co-portfolio manager of Aquila Three Peaks High Income Fund and Aquila Three Peaks Opportunity Growth Fund, was interviewed on Money Life by Chuck Jaffe.

Sandy Rufenacht
Co-Portfolio Manager

During their conversation, Sandy touched on the impact politics can have on bond markets particularly during an election cycle, changes in the rate environment, shifting valuations along the credit-quality curve, and much more.

We hope you enjoy the interview. 

Before investing in a Fund, carefully read about and consider the investment objectives, risks, charges, expenses, and other information found in the Fund prospectus.  The prospectus is available from your financial advisor, and when you call 800-437-1020 or visit www.aquilafunds.com.

05/30/2019

Oregon Scores Well in Volcker Budget Report

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Timothy Iltz is Co-Portfolio Manager of Aquila Tax-Free Trust of Oregon
Vice President and Municipal Bond Analyst, Kirkpatrick Pettis Capital Management

 

The Volcker Alliance, a think tank headed by former Federal Reserve Chairman Paul Volcker, recently released its report, Truth and Integrity in State Budgeting: Preventing the Next Fiscal Crisis. The report covers fiscal years 2016 through 2018 and measures all 50 states in five key budgeting areas: budget forecasting, budget maneuvers, legacy costs, reserve funds, and budget transparency. Each state was given a grade between A and D- for each category and the grades reflect each state’s three-year average for the critical budgeting areas. The report ranked Oregon as one of the top states for managing legacy costs, a measure that evaluates how well states are funding promises made to public employees, including pension funding and health care.

Over the past three years, Oregon has earned an A average for its ability to manage post-employment benefit (OPEB) funding and pension liabilities. The Volcker Alliance reports that Oregon has a public employee pension funded ratio of 83% for 2018, placing the state in the top 6 plans in the nation. Oregon also earned an A average for budget maneuvers, which evaluates whether the state used one-time revenues, borrowings, asset sales, and other measures to achieve short-term budgetary balance. Budget forecasting was the only area where Oregon fell short, with an overall grade of C, which was partially due to the fact that the state does not use consensus revenue forecasts. However, Oregon was noted for its use of multi-year revenue forecasts and revenue growth projections.

In managing the Aquila Tax-Free Trust of Oregon, we maintain a close watch on Oregon’s economy, budget and liabilities, and we are pleased with the results of the Volcker Alliance’s assessment of Oregon’s fiscal health.

04/10/2019

2019 Aquila Tax-Free Fund of Colorado Annual Shareholder Meeting in Denver

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Shareholders of Aquila Tax-Free Fund of Colorado are cordially invited to attend their 32nd annual shareholder meeting Thursday, May 16, 2019 at 2:00 p.m. at the Wellshire Event Center, Cambridge Room, 3333 S. Colorado Blvd., Denver, Colorado. Light refreshments will be served prior to the meeting.

Attendees will have the opportunity to visit with Fund Executives, Trustees, the Portfolio Manager and hear from our guest speaker, Dr. Angie Paccione, Executive Director of the Colorado Department of Higher Education. Dr. Paccione was appointed as Executive Director and unanimously confirmed by the Senate Education Committee in January, 2019. She has more than 20 years of experience in secondary and postsecondary education, has co-authored two books on leadership, and was elected to two terms in the Colorado House of Representatives, where she served as the house majority caucus chair. Dr. Paccione will speak about the Colorado Department of Higher Education’s goals and accomplishments.

We look forward to seeing you on May 16th.

03/07/2019

Aquila Tax-Free Trust of Oregon Annual Shareholder Meeting in Portland

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Shareholders of Aquila Tax-Free Trust of Oregon are cordially invited to attend their annual shareholder meeting Wednesday, April 24th, 2019 at 11:00 a.m. at the Oregon Convention Center, Meeting Rooms F150-151, 777 NE Martin Luther King Jr. Blvd., Portland, Oregon. Light refreshments will be served prior to the meeting and parking will be validated at the end of the meeting.

John Mitchell

John Mitchell

Attendees will have the opportunity to visit with Fund Executives, Trustees, the Portfolio Manager and hear renowned Oregon economist and Trustee, John Mitchell, speak about the Oregon and national economy. Mr. Mitchell is principal of M & H Economic Consultants of Portland. He is a past chairman of the Oregon Council of Economic Advisors, and former chief economist of U.S. Bancorp.

Please plan to attend. We look forward to seeing you on April 24th.

02/05/2019

Aquila Churchill Tax-Free Fund of Kentucky Annual Shareholder Meeting

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Shareholders of Aquila Churchill Tax-Free Fund of Kentucky are cordially invited to attend their annual shareholder meeting Wednesday, April 17, 2019 at 8:30 a.m. at The Olmsted, 3701 Frankfort Avenue, Louisville, Kentucky. A buffet breakfast will be served prior to the meeting. Ryan Barrow

Attendees will have the opportunity to visit with Fund Executives, Trustees, the Portfolio Manager, and hear Ryan Barrow, Executive Director of the Kentucky Finance and Administration Cabinet, which is part of the Office of Financial Management. The Office is responsible for the investment and debt management functions of the Commonwealth, including conducting the state’s bond sales, which provide financing for major projects such as those in which your fund invests. Mr. Barrow was named one of 40 rising stars by Bond Buyer in 2016.

Please plan to attend.  We look forward to seeing you on April 17.

06/14/2018

PERS Liabilities and Local Management of Aquila Tax-Free Trust of Oregon Highlighted by Oregon Business

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Tim Iltz

Tim Iltz

Aquila Tax-Free Trust of Oregon Co-Portfolio Manager and Credit Analyst, Tim Iltz, recently shared his insights on Oregon’s Public Employees Retirement System (PERS) in an article published by Oregon Business, How PERS Liabilities Vary Wildly Across State. Tim’s knowledge of how PERS funding liabilities affect Oregon’s state and local governments illustrates the value of a local management presence, and the ongoing credit analysis provided by Aquila Group of Funds.

Although the PERS system is underfunded, many Oregon local governments have managed to develop budgeting practices and financial management policies specifically addressing this concern. The local management team of Aquila Tax-Free Trust of Oregon consistently monitors all credits in the portfolio.

When researching municipal bond issuers and PERS employers with significant unfunded pension liabilities, credit analysis and due diligence can put pension liabilities into context to determine the potential extent to which PERS funding may be impaired; a situation which varies from employer to employer. Pension concerns and the complexities and nuances of PERS funding heighten the importance of local credit analysis and selective portfolio management.

05/23/2018

The Tax Cuts and Jobs Act has been Beneficial for Colorado

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The Tax Cuts and Jobs Act (TCJA) has been positive for the supply and demand dynamic in the Colorado municipal bond market. TCJA eliminated tax-exempt advanced refunding, which has resulted in lower municipal bond issuance this year. The new law also limits state and local tax deductions to $10,000, which we expect will increase municipal bond demand from investors. Advanced refunding issues accounted for 18% to 29% of municipal bond supply from 2012-2017. The TCJA was the largest overhaul of the US tax code since 1986, and reduces individual and corporate income tax rates, which will affect most states by eliminating or reducing exemptions and deductions that were available prior to its passage. Individual and corporate income tax revenues in Colorado will increase by an estimated $196 to $340 million a year as a result.

The passage of TCJA is also expected to increase Colorado’s general fund by an estimated $309.3 million in fiscal year 2017-18, $207.3 million in fiscal year 2018-19 and $326.3 million in fiscal year 2019-20, according to the Colorado Office of State Planning and Budgeting’s December 2017 forecast. The substantial growth in fiscal year 2017-18 is a one-time increase, as investors postponed capital gain sales and corporations deferred tax liabilities in anticipation of federal tax law changes.

Colorado TCJA

While TCJA is a positive for the state, Colorado’s Public Employees’ Retirement Association’s (PERA) unfunded liability is still a concern that we are monitoring. Senate Bill 18-200 was passed in the Colorado Legislature on May 9, 2018, to make modifications to PERA to reduce its unfunded liability. The TCJA is expected to provide consumers with more disposable income and will continue to expand Colorado’s economy at lower levels due to higher costs of living, tight labor markets and inflationary pressures as interest rates increase.

05/22/2018

Oregon Local Bond Measure Election Analysis

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Earlier this week, Oregon residents approved over $940 million of general obligation bonds across the State, which was historically strong. Although results have yet to be certified, and therefore still preliminary, bonds approved by this election far outweigh the $852 million approved at the previous Oregon November special election in 2017. There are four scheduled election dates in Oregon each year: the 2nd Tuesday in March; the 3rd Tuesday in May; the 3rd Tuesday in September; and the 1st Tuesday after the first Monday in November. In November 2008, Oregon voters approved Ballot Measure 56, which repealed a law requiring more than 50% of a county’s registered voters to vote in bond measure elections held in May and November. As a result, the May election has become an important election to follow for new bond measures.

By election measure, approximately 59% of the bond issues were approved; however, 80% of the total requested par amount was approved by voters. Oregon typically sees more ballot measures during general elections, which are held in November, of even-numbered years. Accordingly, the current election falls flat versus the 2016 November general election, which approved a staggering $1.76 billion of new supply.

Oregon Bond Post

Election results were dominated by Salem-Keizer School District’s $620 million issue, which is estimated to cost taxpayers $1.24/$1,000 of assessed value. Overall, 90% of the total par-amount approved at the election was for school districts making capital improvements to existing facilities and constructing new facilities to accommodate enrollment growth. Furthermore, a significant marketing point for several of the school bond issues was the Oregon School Capital Improvement Matching program, which is a grant program, offered by the Oregon Department of Education for the support of communities that pass general obligation bonds for school improvements.

Some elections were closer than others. Nestucca Valley School District’s general obligation bond was last reported as being favored by only 21 votes. If approved, the bond measure would fund the construction and renovation of school facilities. Also, tax-rate and the overall par amount requested did not seem to weigh into voter decisions as much as demographics and geography. For example, both measures in Douglas County failed. The election also approved a wide variety of projects ranging from park and recreation facilities and road improvements to addressing overcrowding and safety in schools.

Overall, this election will provide a significant source of additional supply to the Oregon bond market. The year has been off to a slow start, and while this election will help alleviate some of the supply concerns, we expect that issuance will be lower this year than last year.