Council debates moving $600,000 from water funds into CDs to raise yield; liquidity concerns raised

Council members discussed moving a portion of the water enterprise fund into certificate‑of‑deposit accounts to increase yield while preserving contingency funds for planned water projects.

Finance Officer Kimberly Becker said the Water Enterprise Fidelity account is "cash heavy" (roughly $1.3 million reported) and recommended moving about $600,000 into CDs (Bank of Oak Ridge rates discussed: 12‑month at ~3.75%, 24‑month at ~3.5%). "I would suggest stair‑stepping them," Becker said, to keep some funds liquid when CDs mature.

Council discussion focused on ensuring enough liquidity for ongoing projects (engineering and anticipated invoices for the 65/Coldwater extension), the town’s ability to withdraw CD principal if needed (town staff said principal would be available though interest would be forfeited on early termination), and denomination strategy (split into smaller CD lots so partial needs do not force total cashing).

Procedural outcome: A motion to move $600,000 to CDs (24‑month term discussed) was made and seconded; council also discussed an amendment to place an additional $200,000 into a 12‑month CD to leave more operating cash. The motion and subsequent amendments were discussed but the transcript does not record a final roll‑call tally on all proposed denominations during the meeting record provided.

Next steps: Finance staff will structure the CDs in consultation with the bank to allow laddering and minimize total forfeited interest if early withdrawals are required; staff will ensure adequate contingency remains available for imminent water projects.