Copperas Cove council authorizes $67,936 payment to U.S. Treasury to comply with 2019 certificates arbitrage rule

The Copperas Cove City Council on Oct. 7 authorized the city manager to submit $67,936 to the U.S. Treasury to satisfy an arbitrage rebate calculation tied to the city—s combination tax and revenue certificates of obligation, series 2019. The payment, city staff said, must be submitted by Oct. 14 to remain in compliance with federal Treasury rules.

Veil Key, director of Financial Services, told the council the rebate calculation performed in August 2024 showed "the actual interest earned was a over a $142,000," while the allowable amount was "over $74,000," leaving "The difference is $67,936 with 66¢." Key said the city has controls and reviews investments quarterly but that projects take time to spend down bond proceeds.

Mayor Yancey asked whether the city could prevent such a payment in the future. Key replied, "The only way that we can stop it is if we do not invest." Key added the city would continue monitoring funds and controls but did not propose changing the city—s investment of bond proceeds at this meeting.

Councilmember Joanne Cortland moved that the council authorize the city manager to submit payment of $67,936 to the Treasury Department to comply with the 1993 Treasury Regulations related to arbitrage calculations for the combination tax and revenue certificate of obligations, series 2019. The motion was seconded by Dale Treadway and approved after members answered the roll-call-style prompt in the affirmative.

The special meeting convened at 5:16 p.m., heard the single action item, and adjourned at approximately 5:20 p.m. Staff said the payment must be submitted before Oct. 14; the council took no further action on investment policy during the meeting.