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Milton staff await Truist reply as city seeks higher returns on reserves
Summary
Council received an update on a planned transfer of funds from a Truist money-market account to a Regions Treasury-bonds account; staff said Truist requested two weeks to consult corporate counsel and that the chief financial officer handles city investments under policy.
City staff told the Milton City Council they are waiting for Truist Bank to respond to a request to move city funds from a Truist money-market account into a Regions Bank Treasury-bonds account after the council previously authorized documentation to open the Regions accounts.
Curtis (staff) had presented transfer documents to Truist and, staff said, Truist asked for two weeks to consult its corporate attorney; the council was nearing the end of that allowance. “We went to Truist with our transfer documents, and, as we expected, they had a very quick change of heart, and they asked for 2 weeks to work with their corporate attorney to review the situation,” a staff presenter reported.
Councilmembers asked for periodic updates on the rate comparisons and service fees at other banks. Staff said Curtis will compile rates and fees for competing banks and present the information at the next council meeting. The agenda discussion noted the accounts and moves are managed by the chief financial officer under the city’s investment policy; the policy delegates investment authority to the chief financial officer with priority criteria of safety, liquidity, return and, last, social policy.
Several councilmembers and members of the public said they were concerned by the timeline and the potential lost yield while funds remained in place waiting for transfers. One councilmember estimated the city could be “losing a thousand dollars a day” of potential additional return compared with the proposed Regions investment, language staff corrected to say the city was not losing funds but forgoing additional potential return while funds remained parked in current investments. Staff reiterated that had Regions accepted the transfer immediately, the move would have proceeded as normal business rather than triggering the policy discussion.
Staff also reminded the council that investment decisions are performed by the chief financial officer and reported semiannually to the council; policy section 2-695 was cited in the discussion as the delegation-of-authority provision. Councilmember Cusack requested and staff agreed to provide comparative bank rate and service-fee information prior to the next council meeting.
