Council reviews investment options; advisor recommends laddered brokerage CDs for ~ $200,000

A municipal financial advisor presented options for investing roughly $200,000 of city funds and said a laddered strategy of brokerage certificates of deposit (CDs) would be simple to explain to residents and preserve principal if instruments are held to maturity. "If you put in 200,000, you don't wanna see it turn into 180,000," the advisor said, arguing CDs limit downside risk while providing steady returns.

The advisor outlined typical yields at the time of the presentation: a six-month brokerage CD around 3.08 percent, a one-year at about 3.75 percent and a two-year near 3.85 percent. He explained these are "moving rates" — availability can change as large issues are purchased — but said "if you hold that CD for its maturity, you're 100% guaranteed your principal plus interest as it was stated originally." He also noted FDIC insurance limits and described a practice of spreading deposits across banks to remain within coverage.

Council members asked about liquidity and laddering choices. The advisor described laddering as staggering maturities (for example, 6, 12 and 24 months) so some funds become available periodically if the city needs cash. He said he could work with the council, Cheryl and Edith to develop a plan if the city decides to proceed, but he was not seeking a decision that night.

Next steps: council members agreed to discuss the proposal among themselves, involve Cheryl and Edith and return with a recommendation or more detailed options at a subsequent meeting.