Palm Beach County retains leading role with $1 billion in Israel bonds, faces legal challenges
By Wilkine Brutus
January 7, 2026 at 6:12 PM EST
Palm Beach County officials announced today that the county purchased an additional $350.5 million in Israel bonds, pushing its total investment to over $1 billion.
Palm Beach County is the world’s largest local government investor in Israel bonds. The second largest holder of Israel bonds is the state of Florida, at about $350 million.
"My job as CFO is not politics, but purely a function of safety, liquidity, and market rate of return," Clerk of the Circuit Court and Comptroller Mike Caruso said during a press conference Wednesday. "My responsibility is to balance these pecuniary measures to maximize the county's ROI or return on investment.”
He was joined by former clerk Joseph Abruzzo, now the Palm Beach County administrator overseeing the county’s day-to-day operations, along with Commissioners Maria Sachs and Greg Weiss, and Mayor Sara Baxter.
Abruzzo said the county had invested $5 million in Israel bonds in 2021.
Caruso said the current total $1 billion investment is expected to generate nearly $136 million in interest over two to three years, which is more than $23 million above what the same investment in the U.S. Treasuries or similar securities would earn.
“ That's over $23 million that our taxpayers do not have to pay in, or that we do not have to collect from taxpayers to fund the county's operations,” Caruso said.
He said the investments earn a higher return than short-term U.S. Treasury bonds, specifically, between 0.55% and 1.00% more.
READ MORE: Palm Beach County is once again expanding its financial ties with Israel
The move highlights Palm Beach County’s role as a leading institutional investor while prompting debate over how local governments balance fiscal responsibility with public interest in international investments.
Meanwhile, the state's Chief Financial Officer, Jimmy Patronis, says Palm Beach County spent about $344 million more than a state formula deems justified over five years, calling government expenditures “wasteful.”
The Palm Beach Post reports county officials may now keep more money in short‑term, liquid investments, a shift that could limit longer‑term moves like Israel bond purchases as they balance higher returns with having cash ready if property tax revenues fall.
But Palm Beach County officials deny the claims by the state that the county overspent.
As for the Israel bonds, the county expects to earn $47 million in interest income over the next three years from this latest purchase, which Caruso said was timed to maximize return for taxpayers.
Caruso addressed a new legal challenge against his office, a lawsuit originally brought by Palestinian-American residents, noting it mirrors a 2024 case that was voluntarily dropped in early 2025 due to procedural issues.
Plaintiffs argue the county’s heavy investment in Israel bonds is both financially risky and politically motivated, claiming officials prioritized pro-Israel politics over neutral fiduciary standards.
“We plan to get this one dismissed too,” Caruso said, emphasizing his confidence that the matter will be resolved in the Clerk’s Office’s favor.
How to spend potential returns
Florida law limits counties’ fixed-income investment options, allowing instruments such as certificates of deposit, or CDs, money market funds, and U.S. government securities. The county’s portfolio operates under strict risk management and reporting standards set by its investment policy.
The most recent $350 million purchase followed an Oct. 21, 2025, vote by the County Commission to temporarily raise the cap on Israel bond holdings from 15% to 18% of the county’s overall portfolio. The change gave Caruso and his team the flexibility to take advantage of higher bond yields amid shifting global market conditions.
Mayor Sara Baxter said “the residents need to know that the more money that we bring back from these investments, the less money we need to collect in taxes, which gives us the commission, the ability to lower your taxes,” she said.
The county has yet to decide what it would do with the investment returns, but Caruso suggested using any additional funds it to keep the property tax mileage down.
Palm Beach County is the world’s largest local government investor in Israel bonds. The second largest holder of Israel bonds is the state of Florida, at about $350 million.
"My job as CFO is not politics, but purely a function of safety, liquidity, and market rate of return," Clerk of the Circuit Court and Comptroller Mike Caruso said during a press conference Wednesday. "My responsibility is to balance these pecuniary measures to maximize the county's ROI or return on investment.”
He was joined by former clerk Joseph Abruzzo, now the Palm Beach County administrator overseeing the county’s day-to-day operations, along with Commissioners Maria Sachs and Greg Weiss, and Mayor Sara Baxter.
Abruzzo said the county had invested $5 million in Israel bonds in 2021.
Caruso said the current total $1 billion investment is expected to generate nearly $136 million in interest over two to three years, which is more than $23 million above what the same investment in the U.S. Treasuries or similar securities would earn.
“ That's over $23 million that our taxpayers do not have to pay in, or that we do not have to collect from taxpayers to fund the county's operations,” Caruso said.
He said the investments earn a higher return than short-term U.S. Treasury bonds, specifically, between 0.55% and 1.00% more.
READ MORE: Palm Beach County is once again expanding its financial ties with Israel
The move highlights Palm Beach County’s role as a leading institutional investor while prompting debate over how local governments balance fiscal responsibility with public interest in international investments.
Meanwhile, the state's Chief Financial Officer, Jimmy Patronis, says Palm Beach County spent about $344 million more than a state formula deems justified over five years, calling government expenditures “wasteful.”
The Palm Beach Post reports county officials may now keep more money in short‑term, liquid investments, a shift that could limit longer‑term moves like Israel bond purchases as they balance higher returns with having cash ready if property tax revenues fall.
But Palm Beach County officials deny the claims by the state that the county overspent.
As for the Israel bonds, the county expects to earn $47 million in interest income over the next three years from this latest purchase, which Caruso said was timed to maximize return for taxpayers.
Caruso addressed a new legal challenge against his office, a lawsuit originally brought by Palestinian-American residents, noting it mirrors a 2024 case that was voluntarily dropped in early 2025 due to procedural issues.
Plaintiffs argue the county’s heavy investment in Israel bonds is both financially risky and politically motivated, claiming officials prioritized pro-Israel politics over neutral fiduciary standards.
“We plan to get this one dismissed too,” Caruso said, emphasizing his confidence that the matter will be resolved in the Clerk’s Office’s favor.
How to spend potential returns
Florida law limits counties’ fixed-income investment options, allowing instruments such as certificates of deposit, or CDs, money market funds, and U.S. government securities. The county’s portfolio operates under strict risk management and reporting standards set by its investment policy.
The most recent $350 million purchase followed an Oct. 21, 2025, vote by the County Commission to temporarily raise the cap on Israel bond holdings from 15% to 18% of the county’s overall portfolio. The change gave Caruso and his team the flexibility to take advantage of higher bond yields amid shifting global market conditions.
Mayor Sara Baxter said “the residents need to know that the more money that we bring back from these investments, the less money we need to collect in taxes, which gives us the commission, the ability to lower your taxes,” she said.
The county has yet to decide what it would do with the investment returns, but Caruso suggested using any additional funds it to keep the property tax mileage down.