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Treasurer advises nine-month renewal for expiring certificate of deposit in general fund
Summary
City treasurer recommended renewing an expiring general-fund certificate of deposit for nine months at a 4.1% rate and placed the decision on the regular agenda for formal approval.
City Treasurer Conso briefed the committee on July 29 about an expiring certificate of deposit (CD) in the general fund and recommended renewing it for nine months at a 4.1% annual percentage rate. The committee placed the renewal on the regular agenda for the council to vote next week.
“Generally, what you're seeing is an inverse curve… the shorter-term CDs have a greater yield than the long term CDs,” Treasurer Conso told the council. He said the bank (United Community Bank) offered a special 4.1% rate for renewals of existing CDs and that a 12-month renewal would yield 3.95%. He recommended the nine-month renewal at 4.1% based on the bank’s expectation of lower rates later.
Conso asked whether the council would authorize staff to prepare paperwork so the bank could draw up the renewal documents before the formal Monday vote next week; the mayor asked to place the item on the regular agenda. The transcript records that there are also CDs in the sewer O&M fund but this discussion concerned the general-fund CD only.
Next steps: staff will prepare renewal paperwork and the council will consider the recommended nine-month renewal at the next regular meeting.
