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Fayston Selectboard extends Bond Bank loan, moves CD funds into general fund
Summary
The Fayston Selectboard unanimously approved rolling its one-year Bond Bank loan into a five-year term to bridge FEMA reimbursement timing, and voted to liquidate a CD to increase operating cash. Staff also discussed seeking a second loan depending on FEMA payment timing.
The Fayston Selectboard voted unanimously on Feb. 10 to roll over its Bond Bank loan from a one-year term to a five-year term to manage cash flow while awaiting FEMA reimbursements. Guest Sarah Stavraky told the board that the town must repay the loan when it has received 50% of FEMA funds for all projects; the town is currently at about 28%.
"The bond bank loan can be extended for five years (currently one year term), and I recommend that we do this," Sarah Stavraky said, explaining the recommendation and the repayment trigger tied to FEMA reimbursements. Chair Chuck Martel moved to roll over the loan; Michael Jordan seconded and the motion carried with all in favor.
Board members also debated near-term liquidity and the prospect of a second loan. Sarah advised beginning talks with the Bond Bank about a second loan and said, "By mid-March, we can better project cash flow. Based on a preliminary estimate, June is when the cash flow becomes tight." She suggested $300,000 as a minimum starting point; Chair Martel suggested the board consider $600,000.
Separately, the board approved a motion to not renew a CD and to transfer those funds into the general fund to improve available cash. Chuck Martel said the board "might want to consider putting less in CDs so that we have more cash available," noting the CD rate (3.68%) compared with the money market account (just under 2%). The motion to move the CD funds into the general fund passed unanimously.
