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NHCOG approves March financial statements amid discussion of moving funds into rate-locked sweep account
Summary
NHCOG accepted its March financial statements and discussed a proposal to move funds into a 3‑month, rate‑locked money-market/sweep yielding about 3.5%, noting a roughly $500 annual interest delta and a ~$918 penalty to break certain CDs.
The Northwest Hills Council of Governments approved its March financial statements at the May 14 meeting while discussing options to improve interest income on reserves.
Finance director Anne Marie told the board that the COG had received a proposal from Torrington Savings Bank to consolidate certain accounts into a money-market/sweep account rate-locked at 3.5% for three months, then subject to market adjustment. She said the move would provide liquidity similar to checking while improving short-term yield compared with existing CDs; staff estimated a roughly $500 difference in annual interest revenue under current balances.
Board members asked how much of the nearly $700,000 checking balance would be swept and whether FDIC coverage would be maintained. Anne Marie explained the bank’s sweep structure uses multiple institutions overnight and described an institutional limit she stated as $200,000,000 for the sweep arrangement; board members expressed surprise and appreciation for that structure. Anne Marie also warned that breaking three existing CDs would incur a combined penalty of about $918.
Several members urged staff to call local banks to negotiate better sweep rates and to request fee waivers given long-standing local relationships. One member moved to accept the March financial statements “as presented,” and the motion carried by voice vote. The board asked the treasurer and executive director to proceed with due diligence and to report back on final sweep arrangements before any funds are moved.
