At the Oct. 20 West Jefferson Council meeting, Finance Director Jack Herrel proposed an ordinance to allow the village to buy certificates of deposit (CDs) with encumbered money in the village’s bank account.
The village has around $1.5 million of encumbered money, meaning money that is already spoken for and will be spent, but can earn interest while it is sitting in a bank account. According to Herrel, the village makes about 1.3 percent interest on its account at Huntington Bank, but could get around 3 percent by buying CDs.
Herrel said the village would have three main goals in buying CDs. First and foremost, the village wants to keep the money safe, he said. Secondly, it wants to maintain liquidity, so that the money is available when it is needed, and thirdly, it wants to earn higher interest.
The CDs would be safe, Herrel said, because they are federally insured. Though CDs aren’t usually liquid, the village would make sure they always had access to the money by "laddering" the CDs, or setting them up so that different CDs would mature at different times of the year. The village could even set it up so that more CDs would mature at times of the year where more money is typically needed, Herrel said.
"We want to be prudent and make as much money as we can off of [our encumbered money]," he added.
In other financial matters, council voted unanimously to create a fund to manage payments to MTB Corp.
The fund will be used to reimburse MTB for the cost of the sewer system the developer paid to have installed on their property near the Target distribution center, west of West Jefferson, as per their agreement with the village. The main function of the fund, Herrel explained, is to keep the money intended for MTB set aside and out of the general fund.
Without the fund, said Herrel, the village would "overstate revenues and overstate expenses."
Unnecessary Traffic Light?
Mike Corning, a resident of West Jeffer-son, asked council to consider either modi-fying or removing the traffic light near the site of the former middle/elementary school, saying there is less traffic since the building was torn down, and the light is a waste of gas.
"Often, you’ll sit at the light, and nobody’s around," Corning said. "It’s time for that thing to disappear."
Council members Sheila Nelson and Gene Sidner disagreed.
"Mike, I live there, and the light doesn’t bother me," Nelson said. "I see more people trying to run stop signs coming from the middle school."
Sidner said that removing the light and putting in a four-way stop would create problems. "I think the light should stay," he said.
Mayor Scott Hockenbery said the village would look into it and has already made modifications to the light so that it can flash red or yellow, as necessary.