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County staff warn House Bill 2152 could cut Sedgwick County investment income
Summary
Sedgwick County staff told commissioners House Bill 2152 would require the county to accept lower bank investment rates, potentially costing about $81,000 in one month on $81 million of idle cash and putting up to $353 million in planned investments at lower yields.
Sedgwick County finance staff warned the commission that House Bill 2152 — described in the meeting as the "bankers' bill" — would force local governments to accept lower bank-offered rates for short-term deposits, reducing county investment income.
"This bill would require us to accept the rate of 3.02%, which would be a loss of $81,000 just in the next month alone," said Brent (finance staff), explaining the difference between a local-bank offer of 4.28% and the lower mandated rate. Brent added the county plans to invest roughly $353,000,000 of idle cash over the next two years and said that money would be subject to the lower rate if the bill passes.
Tonya (staff) said the county should consider opposing the bill and coordinating with other large counties; she noted Johnson County had already provided written testimony and intended to testify orally. Tonya said staff would prepare a written statement that could be routed to committee members even if the hearing window was short.
Commissioners asked for the full quarterly investment report, which Brent said he would circulate. The briefing included a discussion of collateralization practices and how the bill might centralize collateral monitoring at the state level, a shift staff flagged as a concern for local banks' ability to compete for public deposits.
Next steps: staff indicated they would prepare summary and detailed materials for commissioners and pursue coordinated opposition or written testimony to the House committee if directed.
