Summary
- With the state of the economy, inflation, and the federal government shutdown, traditional methods of predicting the markets are not available, affecting long-term investment discussions.
- The committee is reviewing ways to gain insight into cigarette consumption in Cuyahoga County in an effort to project revenue streams.
- The group is committed to the mission of Cuyahoga Arts and Culture (CAC) and mindful of communication to grantees about long-term financial health.
Follow up questions
The trend for cigarette tax collection is going down over time. Has CAC discussed diversifying its revenue streams to make up for the loss?
Audit and Finance Advisory Committee meeting notes
The meeting started at 9:17 a.m. You can find the agenda for this meeting here (agenda items in bold below).
Committee members in attendance:
- Jill Paulsen, executive director, CAC
- Meg Harris, director of administration, CAC
- Gina Vernaci, board trustee
- Meghann Marnecheck
Committee Members Ken Surratt and Luis Cartagena did not attend.
Ryan Nelson, of RedTree Investment Group, also attended.
Investment update
RedTree Investment Group update, presentation and discussion [document]
Introductions were made by Vernaci, Marnecheck and Nelson.
Cuyahoga County Arts & Culture’s revenue source is a dedicated tax on cigarettes that was approved by Cuyahoga County voters in 2006, renewed in 2015, and expanded in 2024. The tax allows CAC to invest millions of dollars each year to support the work of hundreds of local arts nonprofits. The existing tax levy is set to expire in 2035. [source]
CAC has hired RedTree Investment Group to advise on investing. Nelson said the firm is dedicated to investing public funds across the state of Ohio, manages over $10 billion of investments in Ohio, and works with over 350 public entities, including many in Cuyahoga County. Once a year, Nelson gives an update to this committee on how CAC can invest funds.
RedTree assists on “reserve funds” (money CAC doesn’t need to make a payment in the immediate future). Nelson and Harris spoke frequently about how to respond to the market. RedTree purchases securities on behalf of CAC, and U.S. Bank holds them. There have been no changes to investment policy since December 2020, Nelson said.
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Impact of government shutdown on economic data
There was a long discussion of the current economy and how it affects financial markets and confidence in investing. The current government shutdown has resulted in limited economic data releases, Nelson said. Unemployment numbers have not been released since August.
“Historically, the job numbers came out the first business Friday of every month. That was the litmus for the markets,” Nelson said. “We don’t have that right now.”
Nelson said they’re “reading the true tea leaves in the news” about who’s hiring and firing, naming the latest round of Amazon layoffs as an example.
Beef, banana, and coffee prices are up. “While the headline inflation says we’re running at 3%, … it certainly doesn’t feel that way when you’re shopping,” Nelson said. “It’s all centered around the t-word — tariffs … that’s hard to ignore.”
There are differences of opinion between the Trump Administration and the Federal Reserve on where interest rates should be, Nelson said. We will likely have a new Fed chair in 2026. Signs point to people aligned with the Trump administration’s thinking on lowering interest rates.
“As we’re investing monies for public entities here in the state of Ohio, we understand there’s a lot of noise going on with property tax reforms … that we have to be mindful of,” Nelson said. “But we also have a job to do today; we have monies to invest, … but I don’t know what is going to happen over here.”
Suggested Reading
As of September 2025, the CAC investment portfolio is worth about $8.7 million.
A discussion continued about investment strategy over the next six months to five years. Nelson suggested taking advantage of government agencies, commercial paper and CDARs (as listed on page 3 of the presentation).
The presentation concluded and Nelson exited the meeting.
Budget preview coming up
At the Nov. 12 CAC board meeting, members will preview the budget, teeing up approval of the budget in December, an attendee said.
Vernaci asked about projections of the population of smokers in Cuyahoga County (related to the cigarette tax, which is the source of revenue for CAC). The group discussed engaging a lobbyist to monitor legislation and policy developments related to the cigarette tax levy.
Review investment policy and investment objectives
Harris: Policy and objectives come from the Ohio code; we don’t have the ability to change the scope of much of it. If this changes, RedTree lets us know and then we take it to the board for approval.
Review current investment of general funds with STAR Ohio and RedTree Investment Group
Harris said the group will discuss how much money to invest and put forward a projection within the next 12 months, then provide the numbers to Nelson about long-term projections. RedTree then will work in conjunction with CAC’s cash flow plans. Nothing done beyond five years, and the focus is on commercial paper and CDARs.
Communication to grantees
There was a discussion about what to communicate to grantees about the confidence in grant awards in the long-term future (two to four years). The group agreed that messaging needs to reflect funding availability to grantees in order for them to be able to plan but not overcommit.
Paulsen said, “There is always a bit of uncertainty built into the way we work.” Paulsen said CAC can help organizations “see where they fit in the ecosystem.”
Vernaci cautioned that CAC shouldn’t tout predictable funding if it cannot answer what funding looks like years down the road.
Wrap up
The CAC Audit and Finance Advisory Committee won’t meet again until the spring and will likely add new members after April. They will aim to recruit three to five members plus a board member. They are talking with the RTA and Metroparks finance departments about potential candidates.
Meeting adjourned at 10:44 a.m.
These notes are by Documenter Maria Shuckahosee.
If you believe anything in these notes is inaccurate, please email us at documenters@signalcleveland.org with “Correction Request” in the subject line.