In recent weeks, the City of Guthrie has received a portion of the $28 million from the Commonwealth of Kentucky for a much-needed wastewater treatment facility.
The initial allocation of funding is approximately ten percent of the previously estimated construction cost, which amounts to $2.8 million. During their meeting on Tuesday, October 8th, the council approved using $55,000 of that funding to pay City Engineer Mike McGhee and his company, McGhee Engineering, for their work on the project.
During that meeting, the city informed council members that the remaining funds could be invested until further project expenses arose. The interest earned from the funding can be used at the city’s discretion.
During a special meeting on Wednesday, October 16th, council members unanimously voted to use Elkton Bank and Trust to earn interest on the funds. They were informed that a six-month CD of $1 million would yield a 5% interest rate, while a 12-month CD of $800,000 would offer a 4.5% rate – while the remaining $1 million would remain in a liquid account with a variable rate.
The council was also presented with the option of using Raymond James, a company headquartered in St. Petersburg, Florida, with a presence in Kentucky. Raymond James offered a 4.5% interest rate on the total funding amount, with the added benefit of keeping the funds liquid, enabling the city to access them whenever necessary.
Before voting in favor of Elkton Bank and Trust, the council voted unanimously to allow Mayor Jimmy Covington and City Clerk Alison Blummel to have authority over the city’s investments, by approving the city’s investment policy. The policy aims to maximize safety and returns while meeting cash flow needs and complying with Kentucky law. It also outlines investment objectives, authorized investments, risk management strategies, and reporting requirements.
On Thursday, October 17th, Mayor Covington decided to invest the funding with Raymond James, overriding the council’s decision.
The state funding came from House Bill 1 passed by the Kentucky legislature earlier this year. The recent expansion of Guthrie has pushed the current wastewater treatment facility to near capacity. A temporary facility will be constructed before the permanent facility is completed.
Guthrie City Council will meet again on Tuesday evening, November 12th, at 7:00 inside City Hall.
