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Lennox council discusses $10.5M DOC proceeds, opts to renew short‑term CD while exploring banking options
Summary
Council discussed options for the city's $10.5 million in DOC proceeds currently at Security Bank, asked staff to seek updated rates and re‑evaluate an RFP; council approved renewal of a maturing 12‑month CD and directed staff to gather competitive offers for the larger deposit.
City staff informed the council that the city's $10.5 million in DOC proceeds remains at Security Bank in a money‑market placement that currently yielded 4.15% but will drop to about 3.15% in April. Staff recommended either issuing a new RFP for the larger DOC account or informally checking whether Security Bank can provide a more competitive offer; the council asked staff to gather updated rates before making substantial moves.
Council discussed the administrative burden of moving large accounts and the confidentiality approach used in prior RFPs. One member said an RFP had previously been issued confidentially to local banks to elicit best final offers. Another said rolling the existing 12‑month certificate of deposit was reasonable if the city will not need the funds in the next year.
Staff recommended rolling over the currently maturing CD and researching whether a formal or informal RFP would achieve a materially better rate for the DOC proceeds. Council moved and approved renewal of the city's CD at Security Bank and directed staff to return with updated competitive rate information and recommendations on whether to reissue an RFP for the DOC account.
